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. 2
Post-Effective Amendment No. ____
and
INVESTMENT COMPANY ACT OF 1940 [X]
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TriStar Investment Trust
(Exact Name of Registrant as Specified in Charter)
13605 Crestway Drive
Brook Park, Ohio 44142-2657
(Address of Principal Executive Offices)
(216) 362-0730
(Registrant's Telephone Number)
Russell P. Stockhaus
13605 Crestway Drive
Brook Park, Ohio 44142-2657
(Name and address of Agent for Service)
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Approximate Date of Proposed Public Offering:
As soon as practical after the Registration Statement becomes effective.
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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 pursuant to said section (8)a,
may determine.
[Outside front cover]
<PAGE>
P R O S P E C T U S
April 17, 2000
TRISTAR INVESTMENT TRUST
TRISTAR LARGE CAP STOCK FUND
For Investors Seeking Long-Term Capital Appreciation
The Securities and Exchange Commission has not approved or disapproved of these
securities or passed on the accuracy or adequacy of this Prospectus. Any
representation to the contrary is a criminal offense.
TriStar Investment Trust
TriStar Large Cap Stock Fund
13605 Crestway Drive
Brook Park, Ohio 44142
TABLE OF CONTENTS
The Fund 1
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The Fund's Goal............................................................. 1
The Principal Investment Strategies ........................................ 1
The Investment Selection Strategy Used by the Fund.......................... 2
The Principal Risks of Investing in the Fund................................ 2
Who Should Invest........................................................... 4
Performance Summary......................................................... 4
Costs of Investing in the Fund.............................................. 5
Expense Example............................................................. 6
Portfolio Turnover.......................................................... 6
Who Manages the Fund 7
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The Investment Adviser...................................................... 7
The Portfolio Manager....................................................... 7
How to Buy and Sell Shares 8
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Pricing of Fund Shares...................................................... 8
Investing in the Fund....................................................... 8
Minimum Investments......................................................... 9
Types of Account Ownership.................................................. 10
Instructions For Opening and Adding to an Account........................... 11
Tax-Deferred Plans.......................................................... 12
Types of Tax-Deferred Accounts.............................................. 12
Instructions For Selling Fund Shares........................................ 14
Telephone Redemptions....................................................... 14
Additional Redemption Information........................................... 15
Shareholder Communications.................................................. 16
Dividends and Distributions................................................. 17
Taxes....................................................................... 18
<PAGE>
THE FUND
THE FUND'S GOAL
* The Fund primarily aims for long-term capital appreciation. Any income
received such as dividends or interest is incidental to this goal.
The Fund's goal may be changed by the Board of Trustees without shareholder
approval. You will receive advance written notice if there are any material
changes to the Fund's goal. If there is a material change, you might want to
consider whether the Fund remains an appropriate investment for you.
PRINCIPAL INVESTMENT STRATEGIES
The Fund generally invests in selected companies that are included in the
Standard & Poor's 500 Composite Stock Price Index. In addition at least 65% of
the Fund's assets will be invested in common stocks of companies whose market
capitalization are greater than $10 billion dollars.
The Fund is a "non-diversified" portfolio, which means it can invest in fewer
securities than diversified portfolios.
THE INVESTMENT SELECTION STATEGY USED BY THE FUND - The investment adviser uses
a simple and decisive proprietary investment strategy using technical analysis.
Historical earnings and price performance information will be analyzed to try to
identify trends in securities. Securities are bought when these trends signal
that securities are undervalued and have greater opportunity to appreciate in
value more than their peers. Securities are sold when these conditions change or
the investment adviser believes other investments offer better opportunities.
[Side panel: A trend is any general direction or movement in the price or
earnings of a company. These trends can be either up or down. The adviser will
try to identify trends that he believes will repeat themselves and that can
therefore be used to forecast future price behavior.]
THE PRINCIPAL RISKS OF
INVESTING IN THE FUND
Risks in General
Domestic economic growth and market conditions, interest rate levels, and
political events are among the factors affecting the securities markets of the
Fund's investments. You could lose money investing in the Fund. You should
consider your own investment goals, time horizon, and risk tolerance before
investing in the Fund. An investment in the Fund may not be appropriate for all
investors and is not intended to be a complete investment program.
Risks of Investing in Common Stocks
The Fund and its shareholders are subject to the risks associated with common
stock investing. These risks include the financial risk of purchasing individual
companies that perform poorly, the risk that the stock markets in which the Fund
invests may experience periods of turbulence and instability, and the general
risk that domestic and global economies may go through periods of decline and
cyclical change.
<PAGE>
Since the Fund generally invests in common stocks of large companies its share
price may fluctuate more than the stock market as a whole. In addition there are
times when small and medium sized companies perform better than large companies.
During those periods your investment may under perform compared to those
segments of the market that include the small and medium sized companies.
Many factors affect an individual company's performance, such as the strength of
its management or the demand for its product or services. You should be aware
that the value of a company's share price may decline as a result of poor
decisions made by management or lower demand for the company's products or
services. In addition, a company's share price may also decline if its earnings
or revenues fall short of expectations.
Overall stock market risks may also affect the value of the Fund. Over time
stock markets fluctuate and go through periods when stock prices generally
decline. The value of the Fund's investments may decrease more than the stock
markets in general.
Risk of Non-Diversification
As previously mentioned, the Fund is a non-diversified portfolio, which means
that it has the ability to take larger positions in a smaller number of
securities than a diversified portfolio. Non-diversification increases the risk
that the value of the Fund could go down because of the poor performance of a
single investment.
Lack of Operating History and Experience
TriStar Investment Trust (and its first series, TriStar Large Cap Stock Fund) is
a newly organized investment company with no history of operations. None of the
principals, officers, or directors of the investment adviser, TriStar Capital
Management Corp., have ever registered, operated, or supervised the operations
of investment companies, and there is no assurance that their past business
experiences will enable them to successfully manage the assets of the Fund in
the future.
WHO SHOULD INVEST
The Fund may be suitable for you if:
* You wish to invest in large U.S. companies.
* You are seeking the possibility of growth of capital over the long-term - at
least five years. * You can tolerate greater risks associated with common stock
investments.
* You are not looking for current income.
* You are willing to accept fluctuations in share price.
PERFORMANCE SUMMARY
No performance information is presented since the Fund has no operating history
as of the date of this Prospectus.
<PAGE>
COSTS OF INVESTING IN THE FUND
The following table describes the fees and expenses that you may pay if you buy
and hold shares of the Fund.
Shareholder Fees
(fees paid directly from your investment)
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Sales Charge (Load) Imposed on Purchases....................................None
Deferred Sales Charge (Load)................................................None
Sales Charge (Load) Imposed on Reinvested Dividends.........................None
Redemption Fee..............................................................None
Exchange Fee................................................................None
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)
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Management Fees(a).........................................................0.50%
Distribution (12b-1) Fees...................................................None
Other Expenses(b)..........................................................0.70%
Total Annual Fund Operating Expenses.......................................1.20%
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(a) Fees payable under the Management Agreement between the Fund and the Adviser
are fixed at 0.50% of the Fund's average daily net assets up to $10 million,
0.30% of such assets from $10 million to $50 million, and 0.20% of such assets
in excess of $50 million.
(b) Fees payable under the Administration Agreement between the Fund and the
Adviser (the Adviser is also the Administrator) are fixed at 0.70% of the Fund's
average daily net assets up to $10 million, 0.50% of such assets from $10
million to $50 million, 0.45% of such assets from $50 million to $200 million,
0.40% of such assets from $200 million to $500 million, 0.35% of such assets
from 500 million to 1 billion, and 0.30% of such assets in excess of $1 billion.
EXPENSE EXAMPLE
The following example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds. The example assumes
that you invest $10,000 in the Fund for the time periods indicated and then
redeem all of your shares at the end of those periods. The example also assumes
that your investment has a 5% annual return each year and that the Fund's
operating expenses remain the same each year. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
Shareholder Transaction Expenses
================================================================================
One Year Three
Years
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Your costs: $123 $388
================================================================================
PORFOLIO TURNOVER
A mutual fund's turnover rate gives an indication of how transaction costs could
affect the fund's future returns. In general, the greater the volume of buying
and selling by the fund, the greater the impact that brokerage commissions and
other transaction costs will have on its return. Also, funds with high turnover
rates may be more likely to generate capital gains that must be distributed to
shareholders as income subject to taxes.
Changes are made in the Fund's portfolio whenever its portfolio manager believes
such changes are desirable. Selling may also result from liquidity needs.
Portfolio turnover rates are a secondary consideration in making buy and sell
decisions as they do affect costs and taxable distributions.
[Side panel: The average turnover rate for all domestic stock funds is
approximately 88%, according to Morningstar, Inc. The Fund's estimated turnover
rate will be between 80% to 120%.]
<PAGE>
WHO MANAGES THE FUND
THE INVESTMENT ADVISER
TriStar Capital Management Corp., located at 13605 Crestway Drive, Brook Park,
Ohio 44142, serves as the investment adviser to the Fund under an Investment
Advisory Agreement with TriStar Investment Trust (the "Trust"). The Agreement
provides that the Adviser will furnish continuous investment advisory and
management services to the Fund. TriStar Capital Management Corp. was organized
in February 1999 and began serving as investment adviser to the Fund in April
2000. Russell P. Stockhaus is a shareholder and Chief Executive Officer of the
Adviser.
The Adviser manages the investment portfolio of the Fund, subject to policies
adopted by the Trust's Board of Trustees. Under the Investment Advisory
Agreement, the Adviser, at its own expense and without reimbursement from the
Trust, furnishes office space and all necessary office facilities, equipment and
executive personnel necessary for managing the Fund. TriStar Capital Management
also pays the salaries and fees of all officers and trustees of the Trust as
well as officers, directors, or employees of TriStar Capital Management Corp.
For its services, the Adviser is paid a fee of 0.50% of the Fund's average daily
net assets up to $10 million, 0.30% of such assets from $10 million to $50
million, and 0.20% of such assets in excess of $50 million.
THE PORTFOLIO MANAGER
Mr. Stockhaus manages the investment program of the Fund and is primarily
responsible for the day-to-day management of the Fund's portfolio. He has been
the portfolio manager of the Fund since its inception in 2000. Mr. Stockhaus
founded TriStar Capital Management Corp. in 1999. Prior to forming TriStar
Capital Management Corp., Mr. Stockhaus was employed by Accounts Payable
Recovery as an auditor from February 1993 through May 1996. In June 1996 he
began employment with The Profit Recovery Group International, Inc. where he is
still working on a full-time basis as an Audit Manager. Mr. Stockhaus holds a
Bachelor of Science degree in Accounting from Bowling Green State University in
Ohio and became a Certified Public Accountant in 1980.
HOW TO BUY AND SELL SHARES
PRICING OF FUND SHARES
The price you pay for a share of the Fund, and the price you receive upon
selling or redeeming a share of the Fund, is called the Fund's net asset value
("NAV"). The NAV is calculated by taking the total value of the Fund's assets,
subtracting its liabilities, and then dividing by the total number of shares
outstanding, rounded to the nearest cent:
Total Net Assets - Liabilities
Net Asset Value = ---------------------------------------
Number of Shares Outstanding
The NAV is generally calculated as of the close of trading on the New York Stock
Exchange (normally 4:00 p.m. Eastern time) every day the Exchange is open. All
instructions for purchases, redemptions, or reinvestments of fund shares
received by 4:00 p.m. Eastern time will be priced at that day's calculated NAV.
For all purchases your check must also be received by 4:00 p.m. The Fund's
investments are valued at market value or, if a market quotation is not readily
available, at the fair value determined in good faith by the Adviser, subject to
the review and oversight of the Fund's Board of Trustees. The Fund may use
pricing services to determine market value.
<PAGE>
INVESTING IN THE FUND
You can only purchase shares by sending a check directly to the Fund's Transfer
Agent. The only exception would be IRA transfers, which would still have to be
purchased through the Transfer Agent although you would send no check. If you
are investing in the Fund for the first time, you will need to establish an
account by completing a Shareholder Account Application. (To establish an IRA,
complete an IRA Application.) To request an application, call 1-877-593-8637.
Your initial investment minimum can be found in the table below. The Fund
reserves the right to change the amount of these minimums from time to time or
to waive them in whole or in part for certain accounts.
MINIMUM INVESTMENTS
=======================================================
Initial Additional
=======================================================
Regular account $500 $100
IRA account $500 $100
Education IRA $500 $100
All purchases must be made in U.S. dollars and checks must be drawn on U.S.
banks. No cash, credit cards, wire transfers, or third party checks will be
accepted. A $20 fee will be charged against your account for any payment check
returned to the Transfer Agent for insufficient funds, stop payment, closed
account or other reasons. If a check does not clear your bank the Fund reserves
the right to cancel the purchase. If your purchase is canceled, you will be
responsible for any losses or fees imposed by your bank and losses that may be
incurred as a result of a decline in the value of the canceled purchase. The
Fund (or its Transfer Agent) has the authority to redeem shares in your
account(s) to cover any losses due to fluctuations in share price. Any profit on
such cancellation will accrue to the Fund.
Your investment in the Fund should be intended to serve as a long-term
investment vehicle. The Fund is not designed to provide you with a means of
speculating on short-term fluctuations in the stock market. The Fund reserves
the right to reject purchase requests to investors with a history of excessive
trading as it is detrimental to the efficient management of the Fund. The Fund
also reserves the right to stop offering shares at any time.
[Side panel: Costs and market timing: Some investors try to profit from
"market-timing" - switching money into investments when they expect the market
to rise, and taking money out when they expect the market to fall. As money is
shifted in and out by market timers, the Fund incurs expenses for buying and
selling securities. These costs are borne by all Fund shareholders, including
the long-term investors who do not generate the costs. Therefore, the Fund
discourages short-term trading by, among other things, closely monitoring
excessive transactions.]
TYPES OF ACCOUNT OWNERSHIP
You can establish the following types of accounts by completing a Shareholder
Account Application:
Individual or Joint Ownership - Individual accounts are owned by
one person. Joint accounts have two or more owners.
A Gift or Transfer to Minor (UGMA or UTMA) - An UGMA/UTMA account is a
custodial account managed for the benefit of a minor. To open an UGMA or UTMA
account, you must include the minor's social security number on the application.
Trust - An established trust can open an account. The names of each
trustee, the name of the trust and the date of the trust agreement must be
included on the application.
Business Accounts - Corporation and partnerships may also open an
account. The application must be signed by an authorized officer of the
corporation or a general partner of a partnership.
<PAGE>
INSTRUCTIONS FOR OPENING AND ADDING TO AN ACCOUNT
...............................................................................
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
- --------------------------------------------------------------------------------
Complete and sign the Shareholder Complete the investment slip
Application or an IRA Application. that is included with your account
statement, and write your account
Make your check payable to the number on your check. If you no
TriStar Large Cap Stock Fund longer have your investment slip,
* For IRA accounts, please please reference your name,
specify the year for which the account number, and address on
contribution is made. your check.
MAIL APPLICATION AND CHECK TO: MAIL THE SLIP AND CHECK TO:
................................................................................
TriStar Large Cap Stock Fund TriStar Large Cap Stock Fund
c/o Mutual Shareholder Services, LLC c/o Mutual Shareholder Services, LLC
1301 East Ninth Street, Suite 1005 1301 East Ninth Street, Suite 1005
Cleveland, Ohio 44114-1800 Cleveland, Ohio 44114-1800
TAX-DEFERRED PLANS
If you are eligible, you may set up one or more tax-deferred accounts. A
tax-deferred account allows you to shelter your investment income and capital
gains from current income taxes. A contribution to certain of these plans may
also be tax deductible. Tax-deferred accounts include retirement plans described
on the following page and the Education IRA. Distributions from these plans are
generally subject to an additional tax if withdrawn prior to age 59 1/2 or used
for a nonqualifying purpose. Investors should consult their tax adviser or legal
counsel before selecting a tax-deferred account. Complete instructions about how
to establish your tax-deferred retirement plan will be included in the
retirement plan kit you receive in the mail.
Firstar Bank, N.A., serves as the custodian for the tax-deferred accounts
offered by the Fund. You will be charged an annual account maintenance fee of $8
for each tax-deferred account you have with the Fund. You may pay the fee by
check or have it automatically deducted from your account (usually in December).
The custodian reserves the right to change the amount of the fee or to waive it
in whole or part for certain types of accounts.
TYPES OF TAX-DEFERRED ACCOUNTS
* Traditional IRA
An individual retirement account. Your contribution may or may not be deductible
depending on your circumstances. Assets can grow tax-free and distributions are
taxable as income.
* Roth IRA
An IRA with non-deductible contributions, tax-free growth of assets, and
tax-free distributions for qualified distributions.
* Spousal IRA
An IRA funded by a working spouse in the name of a non-earning spouse.
* Education IRA
This plan allows individuals, subject to certain income limitations, to
contribute up to $500 annually on behalf of any child under the age of eighteen.
<PAGE>
* SEP-IRA
An individual retirement account funded by employer contributions. Your assets
grow tax-free and distributions are taxable as income.
* Keogh or Profit Sharing Plans
These plans allow corporations, partnerships and individuals that are
self-employed to make tax-deductible contributions of up to $30,000 for each
person covered by the plans.
* 403(b) Plans
An arrangement that allows employers of charitable or educational organizations
to make voluntary salary reduction contributions to a tax-deferred account.
* 401(k) Plans
Allows employees of corporations of all sizes to contribute a percentage of
their wages on a tax-deferred basis. These accounts need to be established by
the trustee of the plan.
DIVIDEND REINVESTMENT:
................................................................................
All income dividends and capital gains distributions will be automatically
reinvested in shares of the Fund unless you indicate otherwise on the account
application or in writing.
INSTRUCTIONS FOR SELLING FUND SHARES
You may sell all or part of your shares on any day that the New York Stock
Exchange is open for trading. Your shares will be sold at the next NAV per share
calculated after the Transfer Agent receives your order in proper form. The
proceeds of your sale may be more or less than the purchase price of your
shares, depending on the market value of the Fund's securities at the time of
your sale. Your order will be processed promptly and you will generally receive
the proceeds within seven days after receiving your properly completed request.
The Fund will not mail any proceeds unless your investment check has cleared the
bank, which may take up to fifteen calendar days. This procedure is intended to
protect the Fund and its shareholders from loss. If the dollar or share amount
requested is greater than the current value of your account, your entire account
balance will be redeemed.
TELEPHONE REDEMPTIONS
The only transactions that will be executed per telephone instructions are
redemptions. For redemptions made by telephone, the Fund and its Transfer Agent
will employ reasonable procedures to confirm that instructions communicated by
telephone are genuine. Such procedures may include, among others, requiring some
form of personal identification prior to acting upon telephone instructions,
providing written confirmation of all such redemptions, and/or tape recording
all telephone instructions. If reasonable procedures are followed, then neither
the Fund nor the Transfer Agent will be liable for any loss, cost, or expense
for acting upon an investor's telephone instructions or for any unauthorized
telephone redemption. If the Fund's Transfer Agent is not reasonably satisfied
that telephone instructions are genuine, the redemption will not be made.
Neither the Fund nor the Transfer Agent shall be liable if the proceeds from the
redemption are lower than they would have been had the redemption not been
delayed..
TO SELL SHARES
- --------------------------------------------------------------------------------
By Mail
................................................................................
Write a letter of instruction that includes:
* The names(s) and signature(s) of all account owners.
* Your account number.
* The dollar or share amount you want to sell.
* Where to send the proceeds.
* If redeeming from your IRA, please note applicable withholding requirements.
* Obtain a signature guarantee or other documentation, if required.
<PAGE>
MAIL YOUR REQUEST TO:
...............................................................................
TriStar Large Cap Stock Fund
c/o Mutual Shareholder Services, LLC
1301 East Ninth Street, Suite 1005
Cleveland, Ohio 44114-1800
BY TELEPHONE
...............................................................................
* You will automatically be granted * You will not be able to redeem
telephone redemption privileges by telephone and have a check
unless you decline them in writing sent to your address of record
or indicate on the appropriate sec- for a period of 15 days following
tion of the account application that an address change.
you decline this option. Otherwise,
you may redeem Fund shares by * Unless you decline telephone
calling 1-877-593-8637. Redemption privileges in writing or on your
proceeds will only be mailed to your account application, as long as
address of record. the fund takes reasonable
measures to verify the order, you
* You may redeem a maximum of may be responsible for any
$50,000 per day by telephone. fraudulent telephone order.
For specific information on how to redeem your account, and to determine if a
signature guarantee or other documentation is required, please call toll-free in
the U.S. 1-877-593-8637.
ADDITIONAL REDEMPTION INFORMATION
SIGNATURE GUARANTEES
Signature guarantees are designed to protect both you and the Fund from fraud. A
signature guarantee of each owner is required to redeem shares in the following
situations:
* If you change ownership on your account.
* If you request the redemption proceeds to be sent to a different address than
that registered on the account.
* If the proceeds are to be made payable to someone other than the account's
owner(s).
* If a change of address request has been received by the Transfer Agent within
the last 15 days.
* If you wish to redeem $50,000 or more from any shareholder account.
Signature guarantees can be obtained from most banks, savings and loan
associations, trust companies, credit unions, broker/dealers, and member firms
of a national securities exchange. Call your financial institution to see if
they have the ability to guarantee a signature. A notary public cannot provide
signature guarantees.
The Fund reserves the right to delay a redemption when permitted by federal law.
For more information pertaining to signature guarantees, please call
1-877-593-8637.
<PAGE>
CORPORATE, TRUST AND OTHER ACCOUNTS
Redemption requests from corporate, trusts, and other accounts may require
documents in addition to those described above, evidencing the authority of the
officers, trustees or others. In order to avoid delays in processing redemption
requests for these accounts, you should call the Transfer Agent at
1-877-593-8637 to determine what additional documents are required.
ADDRESS CHANGES
To change the address on your account, call the Transfer Agent at 1-877-593-8637
or send a written request signed by all account owners. Include the account
number(s) and name(s) on the account and both the old and new addresses. Certain
options may be suspended for a period of 15 days following an address change.
TRANSFER OF OWNERSHIP
In order to change the account registration or transfer ownership of an account,
additional documents will be required. In order to avoid delays in processing
these requests, you should call the Transfer Agent at 1-877-593-8637 to
determine what additional documents are required.
REDEMPTION INITIATED BY THE FUND
Because there are certain fixed costs involved with maintaining your account,
the Fund may require you to redeem all of your shares if your account balance
falls below $500. After your account balance falls below the minimum balance,
you will receive a notification from the Fund indicating its intent to close
your account along with instructions on how to increase the value of your
account to the minimum amount within 60 days. If your account balance is still
below $500 after 60 days, the Fund may close your account and send you the
proceeds. The right of redemption by the Fund will not apply if the value of
your account balance falls below $500 because of market performance.
SHAREHOLDER COMMUNICATIONS
ACCOUNT STATEMENTS. Every quarter, shareholders of the Fund will automatically
receive regular account statements. You will also be sent a yearly statement
detailing the tax characteristics of any dividends and distributions you have
received.
CONFIRMATIONS. Confirmation statements will be sent after each transaction that
affects your account balance or account registration.
REGULATORY MAILINGS. Financial reports will be sent at least semiannually.
Annual reports will include audited financial statements. To reduce expenses,
one copy of each report will be mailed to each taxpayer identification number
even though the investor may have more than one account in the Fund.
<PAGE>
DIVIDENDS AND DISTRIBUTIONS
The Fund intends to pay distributions on an annual basis and expects that
distributions will consist primarily of capital gains. You may elect to reinvest
income dividends and capital gain distributions in the form of additional shares
of the Fund or receive these distributions in cash. Dividends and distributions
from the Fund are automatically reinvested in the Fund, unless you elect to have
dividends paid in cash. Reinvested dividends and distributions receive the same
tax treatment as those paid in cash. If you are interested in changing your
election, you may call the Transfer Agent at 1-877-593-8637 or send a written
notification to TriStar Large Cap Stock Fund, c/o Mutual Shareholder Services,
LLC 1301 East Ninth Street, Suite 1005 Cleveland, Ohio 44114-1800.
[Side panel: Distributions: As a shareholder, you are entitled to your share of
the Fund's income from dividends and gains from the sale of investments. You
receive such earnings as either an income dividend or a capital gains
distribution. Income dividends come from the dividends that the Fund earns from
its securities. Capital gains are realized when the Fund sells securities for
higher prices than it paid for them. The capital gains are either short-term or
long-term depending on whether the Fund held the securities for less than or
more than one year. When distributions are made the share price of the Fund
drops by the amount of the distribution, net of any market fluctuations.]
TAXES
Fund dividends and distributions are taxable to most investors (unless your
investment is in an IRA or other tax-advantaged account). Dividends paid by the
Fund out of net ordinary income and distributions of net short-term capital
gains are taxable to the shareholders as ordinary income.
Distributions by the Fund of net long-term capital gains to shareholders are
generally taxable to the shareholders at the applicable long-term capital gains
rate, regardless of how long the shareholder has held shares of the Fund.
Redemptions of shares of the Fund are taxable events which you may realize as a
gain or loss. The amount of the gain or loss and the rate of tax will depend
mainly upon the amount paid for the shares, the amount received from the sale,
and how long the shares were held.
The Fund's distributions may be subject to federal income tax whether received
in cash or reinvested in additional shares. In addition to federal taxes, you
may be subject to state and local taxes on distributions.
Because everyone's tax situation is unique, please consult your tax professional
about federal, state, and local tax consequences of an investment in the Fund.
TRISTAR INVESTMENT TRUST
TRISTAR LARGE CAP STOCK FUND
- ------------------------------------------------
BOARD OF TRUSTEES
Russell P. Stockhaus, Chairman
Thomas P. Ziegler
Christopher S. McCann
INVESTMENT ADVISER AND ADMINISTRATOR
TriStar Capital Management Corp.
INDEPENDENT AUDITOR
McCurdy & Associates CPA's Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT
Mutual Shareholder Services, LLC
CUSTODIAN
Firstar Bank, N.A.
[Back cover page]
<PAGE>
TRISTAR INVESTMENT TRUST
TRISTAR LARGE CAP STOCK FUND
- ------------------------------------------------
WHERE TO GO FOR INFORMATION
- -----------------------------------------------
For shareholder inquiries, please call toll-free in the U.S. at 1-877-593-8637.
You will find more information about TriStar Large Cap Stock Fund in the
Statement of Additional Information (SAI). This document contains additional and
more detailed information about the Fund, and is considered to be a part of this
Prospectus.
To obtain a copy of the SAI without charge you may contact the Fund directly
either by mail, phone, or email:
TriStar Large Cap Stock Fund
13605 Crestway Drive
Brook Park, OH 44142
1-216-362-0730 (collect)
[email protected]
You can also review and obtain copies of the fund's SAI and other information at
the SEC's Public Reference Room in Washington, DC; on the EDGAR database on the
SEC's internet website (http://www.sec.gov); or, after paying a publication fee,
by sending a letter to the SEC's Public Reference Section, Washington, DEC
20549-0102 or by sending an electronic mail request to [email protected].
Please call the SEC at 1-202-942-8090 for information about the Public Reference
Room.
TriStar Investment Trust SEC file number 811-09723
<PAGE>
TRISTAR INVESTMENT TRUST
TRISTAR LARGE CAP STOCK FUND
13605 Crestway Drive
Brook Park, OH 44142
(216) 362-0730
TRISTAR LARGE CAP STOCK FUND
STATEMENT OF ADDITIONAL INFORMATION
APRIL 17, 2000
TRISTAR INVESTMENT TRUST
TRISTAR LARGE CAP STOCK FUND
13605 Crestway Drive
Brook Park, OH 44142
(216) 362-0730
This Statement of Additional Information ("SAI") is not a Prospectus, but is to
be read in conjunction with the Prospectus for the TriStar Large Cap Stock Fund
dated April 17th, 2000 ("Prospectus"). To obtain a free copy of the Prospectus
Report, please write or call the Fund at the address or phone number referenced
above.
TABLE OF CONTENTS
THE FUND..................................................................... 2
CAPITAL STRUCTURE............................................................ 3
CONCENTRATION AND NON-DIVERSIFICATION POLICY................................. 3
TAX STATUS................................................................... 3
INVESTMENT GOAL'S AND POLICIES............................................... 4
INVESTMENT RESTRICTIONS...................................................... 4
OTHER INVESTMENTS............................................................ 5
MANAGEMENT OF THE FUND....................................................... 6
REMUNERATION OF OFFICERS AND TRUSTEES........................................ 7
INVESTMENT ADVISER........................................................... 7
ADVISORY AND ADMINISTRATION AGREEMENTS....................................... 8
PRINCIPAL SECURITY HOLDERS................................................... 9
PERFORMANCE INFORMATION...................................................... 9
PORTFOLIO TRANSACTIONS AND BROKERAGE......................................... 11
CUSTODIAN.................................................................... 12
TRANSFER AGENT............................................................... 12
AUDITORS..................................................................... 12
FINANCIAL STATEMENTS......................................................... 13
- i -
<PAGE>
THE FUND
The TriStar Large Cap Stock Fund (the "Fund"), is an open-end, non-diversified
series of The TriStar Investment Trust (the "Trust"). The Trust was organized on
September 22, 1999 as an Ohio trust and is authorized to issue an indefinite
number of shares of beneficial interest. The Board of Trustees of the Trust is
responsible for managing the business affairs of the Fund.
CAPITAL STRUCTURE
At present the Fund is the only series authorized by the Trust. The Board of
Trustees may authorize the creation of 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.
CONCENTRATION AND NON-DIVERSIFICATION POLICY
Concentration: As an investment company, the Fund generally invests in selected
companies that are included in the S&P 500. In addition at least 65% of the
Fund's assets will be invested in common stocks of companies whose market
capitalizations are greater than $10 billion dollars. The fund will not
concentrate its portfolio in a particular industry. This policy of concentration
will not be changed without shareholder approval.
Non-Diversification: The Fund is classified as being non-diversified which means
that it has the ability to take larger positions in a smaller number of
securities than a diversified fund. The Fund, therefore, may be more susceptible
to risk of loss than a more widely diversified fund as a result of a single
economic, political, or regulatory occurrence. The policy of the Fund is one of
selective investments rather than broad diversification. The Fund seeks enough
diversification for adequate representation among what it considers to be the
best performing securities and to maintain its federal non-taxable status under
Subchapter M of the Internal Revenue Code.
TAX STATUS
Under the provisions of Subchapter 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. 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
the 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 GOAL'S AND POLICIES
THE FUND'S GOAL
* The Fund primarily aims for long-term capital appreciation. Any income
received such as dividends or interest, is incidental to this goal.
PRINCIPAL INVESTMENT STRATEGIES
The Fund generally invests in selected companies that are included in the S&P
500. In addition at least 65% of the Fund's assets will be invested in common
stocks of companies whose market capitalizations are greater than $10 billion
dollars.
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) Issue senior 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) Act as underwriter for securities of other issuers except insofar as the
Fund may be deemed an underwriter in selling its own portfolio securities
(d) 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.
(e) 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.
(f) 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.
(g) Invest in companies for the purpose of acquiring control.
(h) Pledge, mortgage or hypothecate any of its assets.
(i) Concentrate investments in a particular industry.
OTHER INVESTMENTS:
In connection with its investment objective and policies the Fund may invest in
the following types of securities which can involve certain risks:
INVESTMENT COMPANIES: The Fund may invest in securities issued by other
investment companies within the limits prescribed by the Investment Company Act
of 1940. The fund intends to limit its investments so that, as determined
immediately after a securities purchase is made: (a) not more than 5% of the
value of the Fund's total assets will be invested in the securities of any one
investment company; (b) not more than 10% of the value of the Fund's total
assets will be invested in securities of investment companies as a group; and
(c) not more than 3% of the outstanding voting stock of any one investment
company will be owned by the Fund.
<PAGE>
FUTURES CONTRACTS: A futures contract is an agreement to buy or sell a specified
amount of a particular commodity or financial instrument at a fixed price on a
future date. A futures contract is a form of a derivative as its value is based
on, or derived from, the value of its underlying security. Futures contracts
will only be purchased on broad based stock indexes such as the S&P 500. Futures
contracts will be used to basically to simulate full investment in the stock
market while keeping cash on hand to meet shareholder redemptions or other
needs. In general the Fund will not use futures contracts for hedging purposes
or as leveraged investments that magnify the gains or losses of an investment.
While the Fund invests mainly in common stocks, it may invest up to 10% of total
assets in cash, obligations of the U.S. Government, or repurchase agreements.
U.S. Government Obligations and repurchase agreements are described below:
U.S. GOVERNMENT OBLIGATIONS: The Fund may purchase obligations 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. U.S. government obligations
may be backed by the credit of the government as a whole or only by the issuing
agency. U.S. Treasury bonds, notes, and bills and some agency securities, such
as those issued by the Federal Housing Administration and the Government
National Mortgage Association (GNMA), are backed by the full faith and credit of
the U.S. government as to payment of principal and interest and are the highest
quality government securities. Other securities issued by U.S. government
agencies or instrumentalities, such as securities issued by the Federal Home
Loan Banks and the Federal Home Loan Mortgage Corporation, are supported only by
the credit of the agency that issued them, and not by the U.S. government.
Securities issued by the Federal Farm Credit System, the Federal Land Banks, and
the Federal National Mortgage Association (FNMA) are supported by the agency's
right to borrow money from the U.S. Treasury under certain circumstances, but
are not backed by the full faith and credit of the U.S. government.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement between a buyer
and a seller, in which the purchaser acquires ownership of a U.S. Government
security (which may be of any maturity) and the seller agrees to repurchase the
obligation at a future time and at a set price, thereby determining the yield
during the purchaser's holding period (usually not more than seven days from the
date of purchase). Generally the Fund will enter into repurchase agreements with
the Trust's custodian or other banks with assets of $1 billion or more. The fund
will not invest more than 10% of its net assets in repurchase agreements
maturing in more than seven days.
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 TriStar Investment
Trust, 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 addresses, age, principal
occupations during the past five years are as follows:
<PAGE>
Principal Occupation Dates of
Name and Address Position Past 5 Years Employment
================== ========= ================== =========
*Russell P. Stockhaus Trustee, The Profit Recovery Group June 1996-
13605 Crestway Drive President, International, Inc., Present
Brook Park, Ohio 44142 Treasurer, and Audit Manager
Date of Birth: 1956 Secretary Accounts Payable February
Recovery, Auditor 1993 -
May 1996
Thomas P. Ziegler Trustee and Dorn Color, Inc. September
16512 Laverne Avenue Vice-Pres. Human Resources Mgr. 1983 -
Cleveland, Ohio 44135 Present
Date of Birth: 1961
Christopher S. McCann Trustee The Profit Recovery Group December
614 North Oakhurst CT. International, Inc. 1996 -
Huron, OH 44839 Audit Manager Present
Date of Birth: 1967 Ames Department Stores September
Inc. 1990 -
Accounts Payable
Supervisor November
1996
*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
Trustee fees are Trust expenses. The Trust intends to pay fees to all Trustees
who are not "interested persons" of not more than $250 for the year ending
December 31, 2000. Compensation paid to the Trustees inception through December
31, 1999 is set forth in the following table:
================================================================================
Pension or Total
Aggregate Retirement Estimated Compensation
Name/Position Compensation Benefits Accrued Annual Benefits From Fund and
From Fund As Part of Upon Fund Complex
Fund Expenses Retirement Paid to
Directors
================================================================================
Russell P. Stockhaus, 0 0 0 0
President
Thomas P. Ziegler, $50 0 0 $50
Vice Pres.
Christopher S. McCann, $50 0 0 $50
Trustee
-------- -------- ------- ---------
TOTAL $100 0 0 $100
INVESTMENT ADVISER
The Fund retains TriStar Capital Management Corp., 13605 Crestway Drive, Brook
Park, OH 44142, as its investment adviser (the "Adviser"). The Adviser is an
Ohio corporation founded in February 1999. 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 Russell P. Stockhaus and Diane L. Stockhaus.
Russell P. Stockhaus has had the direct responsibility for the overall strategic
management of the Fund's portfolio and its administration since the Fund's
inception. Mr. Stockhaus founded TriStar Capital Management Corp. in 1999, and
has served as Chairman of the Board and Chief Executive Officer since the
company's inception. Mr. Stockhaus has a BS degree in Accounting from Bowling
Green State University in Ohio and became a Certified Public Accountant in 1980.
In addition to founding the company in 1999, Mr. Stockhaus was also
simultaneously employed by The Profit Recovery Group, International, Inc., as an
Audit Manager and is currently serving in that capacity on a full time basis.
<PAGE>
ADVISORY AND ADMINISTRATION AGREEMENTS
On December 3rd, 1999 the Board of Trustees unanimously approved an investment
advisory contract (the "Advisory Agreement") and a separate administration
contract (the "Administration Agreement") with TriStar Capital Management Corp.
Under the Advisory Agreement, TriStar Capital Management Corp. will determine
what securities will be purchased, retained or sold by the Fund. Mr. Stockhaus,
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 Adviser must, among other requirements, (i) 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 Adviser. The 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.
The Adviser is paid a fee of 0.50% of the Fund's average daily net assets up to
$10 million, 0.30% of such assets from $10 million to $50 million, and 0.20% of
such assets in excess on $50 million. All fees are computed on the average daily
closing net asset value of the Fund and are payable monthly. The Adviser may at
its discretion, forego sufficient fees which would have the effect of lowering
the Fund's expense ratio and increasing the yield to shareholders.
Under the Administration Agreement, TriStar Capital Management Corp. renders all
administrative and supervisory services to the Fund. TriStar Capital oversees
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. TriStar Capital also arranges 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. TriStar Capital is also responsible for the equipment,
staff, office space and facilities necessary to perform its obligations. The
Fund assumes all other expenses except to the extent of those paid by the
Investment Adviser.
Under the Administration Agreement, TriStar Capital assumes and pays all
ordinary expenses of the Fund. Examples of such expenses include: (a)
organizational costs, (b) compensation of the 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 Investment 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.
Pursuant to the Administration Agreement, TriStar Capital receives a fee which
is paid monthly at an annual rate of 0.70% of the Fund's average daily net
assets up to $10 million, 0.50% of such assets from $10 million to $50 million,
0.45% of such assets from $50 million to $200 million, 0.40% of such assets from
$200 million to $500 million, 0.35% of such assets from $500 million to $1
billion, and 0.30% of such assets in excess of $1 billion. The Administrator may
at its discretion, forego sufficient fees which would have the effect of
lowering the Fund's expense ratio and increasing the yield to shareholders.
The 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 Contract 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.
<PAGE>
PRINCIPAL SECURITY HOLDERS
As of February 1, 2000, Russell P. Stockhaus owned 100% of the shares of the
fund. As such 100% of the shares were owned by the Trustees and Officers of the
Trust.
PERFORMANCE INFORMATION
The Fund's total returns will be 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 returns will reflect 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. Average annual return is based on
historical earnings and is not intended to indicate future performance.
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:
n
P(1+T) = 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.
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. The Fund's investment performance will vary depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. These factors and possible differences in the methods and time periods
used in calculating non-standardized investment performance should be considered
when comparing the Fund's performance to those of other investment companies or
investment vehicles. 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 which is calculated differently from
average annual total return. Total return performance for a specific period
(year to date, calendar quarter, fiscal year or portion thereof) is calculated
by taking the initial investment in the Fund's shares on the first day of the
period and the redeemable value of that investment at the end of the period. The
total return percentage is then determined by subtracting the initial investment
from the redeemable value and dividing the remainder by the initial investment
and expressing the result as a percentage. The calculation assumes that all
income and capital gains dividends by the Fund have been reinvested at net asset
value on the reinvestment dates during the period. Total return may also be
shown as the increased dollar value of the hypothetical investment over the
period. A quotation of the Fund's total return will always be accompanied by the
Fund's average annual total return.
<PAGE>
The Fund may also advertise performance information (a "non-standardized
quotation") which is calculated differently from "average annual total return."
A non-standardized 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 non-standardized quotation may
also be an average annual compounded rate of return over a specified period,
which may be a period different from those specified for "average annual total
return." In addition, a non-standardized quotation may be an indication of the
value of a $10,000 investment (made on the date of the initial public offering
of the Fund's shares) as of the end of a specified period. A non-standardized
quotation will always be accompanied by the Fund's "average annual total return"
as described above.
Performance information for the Fund may be compared, in reports and promotional
literature, to the performance of unmanaged indices which may assume
reinvestment of dividends or interest but generally do not reflect deductions
for administrative and management costs. Examples include, but are not limited
to the Dow Jones Industrial Average (DJIA) and the Standard & Poor's 500
Composite Stock Price Index (S&P 500). 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 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.
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.
From time to time, in marketing and other fund literature, the Fund's
performance may be compared to the performance of other mutual funds in general
or to the performance of particular types of mutual funds with similar
investment goals, as tracked by independent organizations. Among these
organizations, Lipper Analytical Services, Inc. ("Lipper"), a widely used
independent research firm which ranks mutual funds by overall performance,
investment objectives, and assets, may be cited. Lipper performance figures are
based on changes in net asset value, with all income and capital gain dividends
reinvested. Such calculations do not include the effect of any sales charges
imposed by other funds. The Fund will be compared to Lipper's appropriate fund
category, that is, by fund objective and portfolio holdings. The Fund's
performance may also be compared to the average performance of its Lipper
category.
The Fund's performance may also be compared to the performance of other mutual
funds by Morningstar, Inc. which ranks funds on the basis of historical risk and
total return. Morningstar's rankings range from five stars (highest) to one star
(lowest) and represent Morningstar's assessment of the historical risk level and
total return of a fund as a weighted average for three, five and ten year
periods. Ranks are not absolute or necessarily predictive of future performance.
Performance rankings and ratings reported periodically in national financial
publications such as Barron's and Fortune also may be used.
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to policies established by the Board of Trustees of the Trust, the
Investment Adviser is responsible for the Fund's portfolio decisions and the
placing of the Fund's portfolio transactions. In placing portfolio transactions,
the Investment Adviser seeks the best qualitative execution for the Fund, taking
into account such factors as price (including the applicable brokerage
commission or dealer spread), the execution capability, financial responsibility
and responsiveness of the broker or dealer. The Investment Adviser generally
seeks favorable prices and commission rates that are reasonable in relation to
the benefits received.
CUSTODIAN
Firstar Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45202 has been retained
to act as Custodian of the Trust's investments. The Custodian Acts as the
Trust's depository, safekeeps its portfolio securities and investments, collects
all income and other payments with respect thereto, disburses funds at the
Fund's request and maintains records in connection with its duties.
<PAGE>
TRANSFER AGENT
The Trust has entered into an agreement with Maxus Information Systems, Inc.
(d/b/a Mutual Shareholder Services), 1301 East Ninth Street, Suite 1005,
Cleveland, Ohio, 44114 ("Maxus"), for Maxus to act as The Fund's transfer agent,
and to provide The Trust with accounting services, record-keeping and
shareholder service functions. For its services as fund accountant, Maxus
receives a fee from TriStar Capital Management based upon the average value of
the Fund, with a maximum annual fee of $59,250. At Fund net asset values
averaging less than $25 million, the annual fee would be $21,000. For all other
services provided, Maxus receives from TriStar Capital an annual fee of $9.25
per shareholder (with a minimum charge of $775 per month) for shareholders
services provided and an annual fee of $100 per state for state registration and
qualification of Fund shares provided.
AUDITORS
The firm of McCurdy & Associates CPA's, Inc., 27955 Clemens Road, Westlake, Ohio
44145 has been selected as independent auditors for the Trust for the year
ending September 30, 2000. McCurdy & Associates CPA's, Inc. performs an annual
audit of the Trust's financial statements and provides financial, tax and
accounting consulting services as requested.
FINANCIAL STATEMENTS
To The Shareholders and Board of Trustees
TriStar Investment Trust:
We have audited the accompanying statement of assets and liabilities of The
TriStar Investment Trust (comprising, respectively, the TriStar Large Cap Stock
Fund) as of April 10, 2000. 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 April 10, 2000, 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 TriStar
Investment Trust constituting TriStar Large Cap Stock Fund as of April 10, 2000,
in conformity with generally accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
April 10, 2000
<PAGE>
TRISTAR INVESTMENT TRUST
STATEMENT OF ASSETS AND LIABILITIES
APRIL 10, 2000
TriStar Large
Cap Stock 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 accompanying notes and accountant's audit report
<PAGE>
TRISTAR INVESTMENT TRUST
NOTES TO FINANCIAL STATEMENTS
April 10, 2000
1. ORGANIZATION
TriStar Investment Trust (the "Trust") is an open-end management
investment company organized as a business trust under the laws of the
State of Ohio by a declaration of trust dated September 22, 1999 and is
authorized to issue an indefinite number of shares of beneficial
interest. There is currently only one series within the Trust, the
TriStar Large Cap Stock Fund (the AFund@). It represents a separate
non-diversified portfolio of securities.
The Fund uses an independent custodian. No transactions other than those
relating to organizational matters and the sale of 10,000 shares of the
TriStar Large Cap Stock Fund have taken place to date.
The Fund's primary investment objective is long-term capital
appreciation.
2. CONTROL PERSONS
As of April 10, 2000, all of the outstanding shares of the Fund were
owned by Russell P. Stockhaus. 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.
3. RELATED PARTY TRANSACTIONS
TriStar Capital Management Corp. is the investment adviser for the Fund.
It manages the Fund=s portfolio and provides administrative services to
the extent not supplied by other service providers. Fees payable under
the Management Agreement between the Fund and the Adviser are fixed at
0.50% of the Fund's average daily net assets up to $10 million, 0.30% of
such assets from $10 million to $50 million, and 0.20% of such assets in
excess of $50 million. Fees payable under the Administration Agreement
between the Fund and the Adviser are fixed at 0.70% of the Fund's average
daily net assets up to $10 million, 0.50% of such assets from $10 million
to $50 million, 0.45% of such assets from $50 million to $200 million,
0.40% of such assets from $200 million to $500 million, 0.35% of such
assets from 500 million to 1 billion, and 0.30% of such assets in excess
of $1 billion. TriStar Capital Management assumes and pays all ordinary
expenses of the Fund except independent trustee fees and extraordinary
and non-recurring expenses.
Certain officers and/or directors of TriStar Capital Management Corp.
are also officers and/or trustees of the Fund.
Mutual Shareholder Services, Inc. acts as the Fund's transfer agent and,
in that capacity, maintains the records of each shareholder's account,
answers shareholders' inquiries concerning their accounts, processes
purchases and redemptions of the Fund' shares, acts as dividend and
distribution disbursing agent and performs other shareholder service
functions.
<PAGE>
TRISTAR INVESTMENT TRUST
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 10, 2000
Mutual Shareholder Services, Inc. also provides fund accounting services
to the Fund including maintaining the Fund's accounts, books and
records and calculating the daily net asset value.
Certain officers and /or owners of TriStar Capital Management Corp. are
also officers of the Fund.
4. CAPITAL STOCK AND DISTRIBUTION
At April 10, 2000, the authorized capitalization of the Fund consists of
unlimited shares without par value per share. Each share has equal
dividend, distribution and liquidation rights. There are no conversion,
subscription or preemptive rights applicable to any shares of the Fund.
All shares issued are fully paid and non-assessable. Each holder of
common stock has one vote for each share held. There are no restrictions
on the right of shareholders to retain or dispose of their shares.
Voting rights are non-cumulative. Transactions in capital stock were as
follows:
Shares Sold:
TriStar Large Cap Stock Fund 10,000
Shares Redeemed:
TriStar Large Cap Stock Fund 0
Net Increase:
TriStar Large Cap Stock Fund 10,000
Shares Outstanding:
TriStar Large Cap Stock Fund 10,000
FORM N-1A
PART C - OTHER INFORMATION
Item 23. Exhibits
Exhibits - All exhibits believed to be applicable to this filing include:
Exhibit No. Description
10.10 Certificate of Trust of TriStar Investment Trust
10.20 Declaration of Trust of TriStar Investment Trust, Table of Contents
10.21 Declaration of Trust of TriStar Investment Trust
20.10 Certificate of Consent of the Trustees of TriStar Investment Trust
30.10 Investment Advisory Agreement
30.20 Administration Agreement
40.10 Subscription Agreement
50.10 Reimbursement Agreement
60.10 Transfer Agent Agreement
60.20 Accounting Services Agreement
70.10 Custody Agreement
80.10 Legal Opinion and Consent of Counsel
90.10 Consent of Independent Auditors
<PAGE>
Item 24 Control Persons
Not Applicable.
Item 25. Indemnification
Reference is made to sections 5.1 and 5.2 of the Declaration of Trust of TriStar
Investment Trust (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).
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 26. Business and Other Connections of the Investment Adviser
TriStar Capital Management Corp.'s exclusive activity at the present time is
performance on its Investment Advisory Contract and Administration Agreement
currently effective with TriStar Investment Trust. Russell P Stockhaus is a 45%
owner, officer and director of TriStar Investment Corp. Mr. Stockhaus is solely
responsible for carrying on the duties described in the Investment Advisory
Contract and Administration Agreement. TriStar Capital Management Corp.'s
address is: 13605 Crestway Drive, Brook Park, OH 44142.
Mr. Stockhaus is also employed by The Profit Recovery Group International, Inc.
on a full-time basis as an Audit Manager. Their address is: 2300 Windy Ridge
Parkway, Suite 300 North, Atlanta, GA 30339-8426.
Item 27. Principal Underwriter The Fund acts as its own underwriter.
Item 28. Location of Accounts and Records
All fund records are held at the Trust's principal executive offices at 13605
Crestway Drive, Brook Park, OH 44142 except (1) records held and maintained by
Firststar Bank relating to its function as custodian; and (2) records held and
maintained by Mutual Shareholder Service, relating to its function as fund
accountant, administrator and transfer agent.
Item 29. Management Services
Not Applicable
Item 30. Undertakings
None.
<PAGE>
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 Butler, State of
Pennsylvania, on the 12th day of April, 2000.
TriStar Investment Trust
By: /s/ Russell P. Stockhaus
Russell P. Stockhaus, 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/ Russell P. Stockhaus 4/12/2000
Russell P. Stockhaus Trustee; President, Secretary, Treasurer,
and Chairman of the Board Date
/s/ Thomas P. Ziegler 4/12/2000
Thomas S. Ziegler Trustee, Vice President Date
/s/ Christopher S. McCann 4/12/2000
Christopher S. McCann Trustee Date
Exhibit 10.10
<PAGE>
CERTIFICATE OF TRUST/
REPORT OF OPERATION OF BUSINESS TRUST
This Certificate of Trust is filed in accordance with the provisions of
the Ohio Business Trust Act (Chapter 1746.04 Ohio Revised Code) and sets forth
the following:
1. The name of the business trust is TriStar Investment Trust.
2. The following persons shall serve as all the Trustees of
TriStar Investment
Trust:
Russell P. Stockhaus 13605 Crestway Drive
Brook Park, Ohio 44142-2657
Thomas P. Ziegler 16512 Laverne Avenue
Cleveland, Ohio 44135
Christopher S. McCann 614 North Oakhurst Court
Huron, Ohio 44839
3. TriStar Investment Trust began engaging in business in Ohio on July
8, 1999. Further, TriStar Investment Trust 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.)
4. This report is not being made to enable the business trust to
maintain an action in a court of this state.
5. The business trust will maintain a place of business in Ohio from
which business will be engaged on its own behalf in activities permitted by its
trust instrument and permitted under Chapter 1746, Ohio Revised Code.
6. The address of the principal office of the business trust is 13605
Crestway Drive, Brook Park, Cleveland County, Ohio 44142-2675.
7. The name and address within Ohio of a designated agent upon whom
process against the business trust may be served is Russell P. Stockhaus, 13605
Crestway Drive, Brook Park, Cleveland County, Ohio 44142-2657.
8. The above-named business trust irrevocably consents to service of
process upon its designated agent and to service of process upon the Secretary
of State if, without the registration of another agent with the Secretary of
State, its designated agent has died, resigned, lost authority, dissolved,
become disqualified, or has removed from this state, or its designated agent
cannot, with due diligence, be found.
9. Not more than ninety (90) days after the occurrence of any event
causing any filing
<PAGE>
of the above information or any previous filing with respect thereto to be
inaccurate or incomplete, the above-named business trust agrees to furnish all
information necessary to maintain the accuracy and completeness of such filing.
AN EXECUTED COPY OF THE TRUST INSTRUMENT OR A TRUE AND CORRECT COPY OF IT,
CERTIFIED TO BE SUCH BY A TRUSTEE BEFORE AN OFFICIAL AUTHORIZED TO ADMINISTER
OATHS OR BY A PUBLIC OFFICIAL IN ANOTHER STATE IN WHOSE OFFICE AN EXECUTED COPY
IS ON FILE, MUST BE ATTACHED AS AN EXHIBIT TO THIS REPORT.
Date:July 31,________________________ 1999
TRISTAR INVESTMENT TRUST
BY: /s/Russell P. Stockhaus
RUSSELL P. STOCKHAUS, Trustee
10. Certification of copy of business trust instrument by a Trustee:
STATE OF Ohio )
) ss.
COUNTY OF Cuyahoga )
I, RUSSELL P. STOCKHAUS, being duly sworn, declare under oath that I am
Trustee of a business trust. I certify that attached hereto as an exhibit to
this report is an executed copy of the trust instrument or a true and correct
copy of it.
/s/ Russell P. Stockhaus
RUSSELL P. STOCKHAUS
Sworn to before me and subscribed in my presence this _31st_ day of
July, 1999.
/s/ Christina M. Dennis
Christina M. Dennis
NOTARY PUBLIC
<PAGE>
46
J. Kenneth Blackwell
Secretary of State
EXHIBIT TO REPORT OF OPERATION OF BUSINESS TRUST
BUSINESS TRUST AGREEMENT
OF
TRISTAR INVESTMENT TRUST
a Business Trust to be operated pursuant to Chapter 1746, Ohio Revised Code
The undersigned person, desiring to form a business trust, does hereby certify:
FIRST: The name of said business trust shall be TriStar Investment Trust.
SECOND: The place where the principal office of the business trust is 13605
Crestway Drive, Brook Park, Cuyahoga County, Ohio 44142-2657.
FOURTH: The number and classes, if any, of shares of beneficial
interest and the par value per share, if any, which the
business trust is authorized to have outstanding, the
assessability or nonassesability of such shares, the terms of
the shares of each class or series thereof, and any
restrictions or authorizations upon the Trustees or holders of
shares of beneficial interest to restrict the transferability
of the share are:
The beneficial interests in the trust shall consist
of an unlimited number of nonassessable interests. No classes
or series have been issued, however there are no restrictions
or authorizations upon the Trustees or holders of beneficial
interests to restrict the transferability of the shares other
than to comply with the Investment Company Act of 1940.
IN WITNESS WHEREOF, we have hereunto subscribed our names on the
_24th___ day of July, 1999.
/s/ Russell P. Stockhaus
RUSSELL P. STOCKHAUS
/s/ Thomas P. Ziegler
THOMAS P. ZIEGLER
/s/ Christopher S. McCann
CHRISTOPHER S. McCANN
AN EXECUTED COPY OR A TRUE AND CORRECT COPY OF THIS INSTRUMENT MUST BE ATTACHED
AS AN EXHIBIT TO A REPORT OF OPERATION OF A BUSINESS TRUST AND CERTIFIED TO BE
SUCH BY A TRUSTEE BEFORE AN OFFICIAL AUTHORIZED TO ADMINISTER OATHS, BEFORE IT
CAN BE FILED IN THE OFFICE OF THE SECRETARY OF STATE. (Ohio Revised Code Ann.
Section 1746.04)
<PAGE>
EXHIBIT 10.20
DECLARATION OF TRUST OF TRISTAR INVESTMENT TRUST
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 12
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
Exhibit 10.21
<PAGE>
DECLARATION OF Trust
OF
TRISTAR INVESTMENT TRUST
This DECLARATION OF TRUST of TriStar Investment Trust is made on the
24th day of July, 1999, by the parties signatory hereto, as Trustees.
WHEREAS, the Trustees desire to form a business Trust under the laws of
Ohio 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 "TriStar Investment Trust", 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 Title VXII Chapter 1746 (et seq.) of the
BOBTA. 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 BOBTA, and in connection therewith, the Trust shall
have and may exercise all of the powers conferred by the laws of the State of
Ohio upon a Ohio 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 BOBTA.
(g) "BOBTA" shall mean the Baldwin's Ohio Revised Code Annotated Title
XVII, Chapter1746 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 Adviser" 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.
<PAGE>
(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.
(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 three (3) 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.
<PAGE>
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.
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 Ohio 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
<PAGE>
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.
(b) A quorum for all meetings of the Trustees shall be two-thirds
(2/3rds) of the total number of Trustees, 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.
<PAGE>
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.
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 BOBTA. 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.
<PAGE>
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 BOBTA, 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.
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 Ohio, 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 Adviser (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. 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.
<PAGE>
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 Ohio, or otherwise.
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.
<PAGE>
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.
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.
<PAGE>
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 Ohio 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.
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.
<PAGE>
(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,
BOBTA, 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.
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:
<PAGE>
(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 Ohio pursuant to the BOBTA, and
upon the giving of such notice in the Certificate of Trust, the statutory
provisions of Chapter 1746 of the BOBTA relating to limitations on inter-series
liabilities (and the statutory effect under Chapter 1746 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.
(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.
<PAGE>
(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 Chapter 1746 of BOBTA.
<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 the BOBTA.
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.
<PAGE>
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.
(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 Ohio. In accordance with Chapter 1746 (et seq.) of BOBTA, 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.
ARTICLE X: MISCELLANEOUS
Section 10.1 Certificate of Designation; Agent for Service of Process.
The Trust shall file, in accordance with Title XVII of BOBTA, in the office of
the Secretary of State of Ohio, a Certificate of Trust, in the form and with
such information required by Chapter 1746.04 by BOBTA and executed in the manner
specified. In the event the Trust does not have at least one (1) Trustee
qualified under Chapter 1746.04 of BOBTA, then the Trust shall comply with
Chapter 1746.04 of BOBTA by having and maintaining a registered office in Ohio
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 BOBTA
would have governed, in which case the Ohio common law governs.
<PAGE>
Section 10.2 Governing Law. This Declaration is executed by all of the
Trustees and delivered with reference to BOBTA and the laws of the State of
Ohio, and the rights of all parties and the validity and construction of every
provision hereof shall be subject to and construed according to BOBTA and the
laws of the State of Ohio (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 Chapter 1746 of Title XVII of the
Baldwin's Ohio Revised Code or (b) any provisions of the laws (statutory or
common) of the State of Ohio (other than the BOBTA) 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 BOBTA, 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 BOBTA 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 an Ohio 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.
<PAGE>
IN WITNESS WHEREOF the undersigned has caused this Declaration of Trust
to be executed as of the day and year first above written.
/s/ Russell P. Stockhaus July 24, 1999
RUSSELL P. STOCKHAUS, Trustee Date
/s/ Thomas P. Ziegler July 24, 1999
THOMAS P. ZIEGLER, Trustee Date
/s/ Christopher S. McCann July 24, 1999
CHRISTOPHER S. McCANN, Trustee Date
EXHIBIT 20.10
CERTIFICATE OF CONSENT OF THE TRUSTEES OF
TRISTAR INVESTMENT TRUST
The undersigned, being Trustees of TriStar Investment Trust (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 TriStar Large Cap Stock 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.
<PAGE>
(c) 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.
(d) 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.
(e) 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.
(f) Invest in companies for the purpose of acquiring control.
(g) 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.
(h) Pledge, mortgage or hypothecate any of its assets.
(i) 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.
(j) 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.
(k) Issue senior securities.
In connection with its investment objective and policies the Fund may invest in
the following types of securities which can involve certain risks:
INVESTMENT COMPANIES: The Fund may invest in securities issued by other
investment companies within the limits prescribed by the Investment Company Act
of 1940. The fund intends to limit its investments so that, as determined
immediately after a securities purchase is made: (a) not more than 5% of the
value of the Fund's total assets will be invested in the securities of any one
investment company; (b) not more than 10% of the value of the Fund's total
assets will be invested in securities of investment companies as a group; and
(c) not more than 3% of the outstanding voting stock of any one investment
company will be owned by the Fund.
U.S. GOVERNMENT OBLIGATIONS: The Fund may purchase obligations 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. U.S. government obligations
may be backed by the credit of the government as a whole or only by the issuing
agency. U.S. Treasury bonds, notes, and bills and some agency securities, such
as those issued by the Federal Housing Administration and the Government
National Mortgage Association (GNMA), are backed by the full faith and credit of
the U.S. government as to payment of principal and interest and are the highest
quality government securities. Other securities issued by U.S. government
agencies or instrumentalities, such as securities issued by the Federal Home
Loan Banks and the Federal Home Loan Mortgage Corporation, are supported only by
the credit of the agency that issued them, and not by the U.S. government.
Securities issued by the Federal Farm Credit System, the Federal Land Banks, and
the Federal National Mortgage Association (FNMA) are supported by the agency's
right to borrow money from the U.S. Treasury under certain circumstances, but
are not backed by the full faith and credit of the U.S. government.
<PAGE>
FUTURES CONTRACTS: A futures contract is an agreement to buy or sell a specified
amount of a particular commodity or financial instrument at a fixed price on a
future date. A futures contract is a form of a derivative as its value is based
on, or derived from, the value of its underlying security. Futures contracts
will only be purchased on broad based stock indexes such as the S&P 500. Futures
contracts will be used to basically to simulate full investment in the stock
market while keeping cash on hand to meet shareholder redemptions or other
needs. In general the Fund will not use futures contracts for hedging purposes
or as leveraged investments that magnify the gains or losses of an investment.
REPURCHASE AGREEMENTS: A repurchase agreement is an agreement between a buyer
and a seller, in which the purchaser acquires ownership of a U.S. Government
security (which may be of any maturity) and the seller agrees to repurchase the
obligation at a future time and at a set price, thereby determining the yield
during the purchaser's holding period (usually not more than seven days from the
date of purchase). Generally the Fund will enter into repurchase agreements with
the Trust's custodian or other banks with assets of $1 billion or more. The fund
will not invest more than 10% of its net assets in repurchase agreements
maturing in more than seven days.
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/ Russell P. Stockhaus 12/03/99
Russell P. Stockhaus, Trustee Date
/s/ Thomas P. Ziegler 12/03/99
Thomas P. Ziegler, Trustee Date
/s/ Christopher S. McCann 12/03/99
Christopher S. McCann, Trustee Date
EXHIBIT 30.10
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT ("Agreement"), is made and entered into by
and between TriStar Investment Trust, an Ohio business trust (the "Fund"), and
TriStar Capital Management Corp., an Ohio 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 TriStar Large
Cap Stock 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.
<PAGE>
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 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 other transactions. 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.
<PAGE>
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.
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 0.50% per annum of the daily net assets of
the fund up to $10 million, 0.30% of such assets from $10 million to $50
million, and 0.20% of such assets in excess of $50 million. The first payment of
fee hereunder shall be prorated on a daily basis from the date this Agreement
takes effect. The Adviser may at its discretion, forego sufficient fees which
would have the effect of lowering the Fund's expense ratio and increasing the
yield to shareholders. 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.
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 or 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.
<PAGE>
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 agreement shall be construed in accordance with and
governed by the Laws of the State of Ohio.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and sealed by their duly authorized officers this 3rd day of December 1999.
TriStar Investment Trust TriStar Capital Management Corp.
By: /s/ Russell P. Stockhaus By: /s/ Russell P. Stockhaus
Russell P. Stockhaus, President Russell P. Stockhaus, President
ATTEST
By: /s/ Thomas P. Ziegler By: /s/ Diane L. Stockhaus
Thomas P. Ziegler, Vice Pres. Diane L. Stockhaus, Secy.
EXHIBIT 30.20
ADMINISTRATION AGREEMENT
THIS ADMINISTRATION AGREEMENT ("Agreement"), is made by and between TriStar
Investment Trust, an Ohio business trust (the "Fund"), and TriStar Capital
Management Corp., an Ohio 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:
<PAGE>
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. 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 thirty days after the end of each calendar
month, a fee, accrued each calendar day (including weekends and holidays) at a
rate of 0.70% per annum of the Fund's average daily net assets up to $10
million, 0.50% of such assets from $10 million to $50 million, 0.45% of such
assets from $50 million to $200 million, 0.40% of such assets from $200 million
to $500 million, 0.35% of such assets from 500 million to 1 billion, and 0.30%
of such assets in excess of $1 billion 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. The administrator may at its discretion, forego sufficient fees
which would have the effect of lowering the Fund's expense ratio and increasing
the yield to shareholders.
<PAGE>
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.
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 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 the earlier of actual or first attempted
delivery, if mailed, postage prepaid, addressed as follows:
If to the Administrator: If to the Fund:
TriStar Capital Management Corp. TriStar Investment Trust
13605 Crestway Drive 13605 Crestway Drive
Brook Park, OH 44142 Brook Park, OH 44142
Telephone No.: (216) 362-0730 Telephone No.: (216) 362-0730
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 Ohio.
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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and sealed by their duly authorized officers this of 3rd day of December, 1999.
TriStar Investment Trust TriStar Capital Management Corp.
By: /s/ Russell P. Stockhaus By: /s/ Russell P. Stockhaus
Russell P. Stockhaus, President Russell P. Stockhaus, President
ATTEST ATTEST
By: /s/ Thomas P. Ziegler By: /s/ Diane L. Stockhaus
Thomas P. Ziegler, Vice-Pres. Diane L. Stockhaus, Secretary
EXHIBIT 40.10
<PAGE>
SUBSCRIPTION AGREEMENT
For and in consideration of the mutual agreements herein contained, Russell P.
Stockhaus, hereinafter referred to as "Subscriber" hereby agrees to purchase
from the TriStar Large Cap Stock Fund (the "Fund"), a mutual fund series of
TriStar Investment Trust and Fund agrees to sell to Subscriber 10,000 shares of
capital stock of Fund, par value $1.00 per share, at the price of $10.00 per
share, upon the following terms and conditions:
Subscriber agrees to pay $100,000 to Fund upon demand.
Fund will not issue any securities or receive any of the proceeds of this
subscription until subscriptions identical in form to this one have been made by
not more than 25 persons (which shall include Subscriber) to purchase from Fund
securities for an aggregate net amount, which plus Fund's then net worth will
equal at least $100,000.
Unless such aggregate net amount is paid to Fund and Fund then has $100,000 of
net worth within 90 days after December 3rd, 1999, the date on which the
registration statement filed under the Securities Act of 1933 with respect to
the Fund's capital stock became effective, then this subscription shall become
null and void and the full amount paid in by the Subscriber will be refunded to
Subscriber on demand without any deduction.
In the event that such aggregate net amount of cash has been paid in and Fund
has a net worth of at least $100,000 within 90 days after such registration
statement has become effective, then this subscription shall be in full force
and effect; and Fund may retain all funds tendered to it.
Subscriber agrees that the shares are being purchased for investment with no
present intention of reselling or redeeming said shares.
It is understood that said aggregate net amount will be paid in to Fund before
any subscriptions for Fund capital stock will be accepted from any persons in
excess of twenty-five.
Subscriber of shares of the TriStar Large Cap Stock Fund
By:/s/ Russell P. Stockhaus 12/03/99
Russell P. Stockhaus Date
Subscription agreed to TriStar Large Cap Stock Fund
By:/s/ Russell P. Stockhaus 12/03/99
Russell P. Stockhaus Date
Chairman, Board of Trustees
TriStar Investment Trust
EXHIBIT 50.10
<PAGE>
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 60.10
TRANSFER AGENT AGREEMENT
THIS AGREEMENT is made and entered into this 3rd day of December, 1999,
by and between TriStar Investment Trust, a registered management investment
company (the "Fund"), and Mutual Shareholder Services, an Ohio corporation
("MSS").
RECITALS:
A. The Fund 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 Fund 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 Fund hereby employs and appoints MSS to act, and MSS agrees to act, as
transfer agent for the Fund's authorized and issued shares of beneficial
interest of each class of each portfolio of the Fund (the "Shares"), and as
dividend disbursing and redemption agent for the Fund.
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 Fund 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 Fund
authorized by the Board of Directors of the Fund (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 Fund;
(vii) Maintain records of account for and advise the Fund
and its Shareholders as to the foregoing; and
(viii) Record the issuance of shares of the Fund and
maintain pursuant to SEC Rule 17Ad-10(e) a record of the total
number of shares of the Fund which are authorized, based upon
data provided to it by the Fund, and issued and outstanding.
MSS shall also provide the Fund 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 Fund.
(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 Fund 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 Fund and MSS.
2. FEES AND EXPENSES
2.01 In consideration of the services to be performed by MSS pursuant
to this Agreement, the Fund 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 Fund
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 Fund will be reimbursed by the Fund.
2.03 The Fund 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, Fund reports and other mailings to all
shareholder accounts shall be advanced to MSS by the Fund at least seven days
prior to the mailing date of such materials.
<PAGE>
3. REPRESENTATIONS AND WARRANTIES OF MSS
MSS represents and warrants to the Fund 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 FUND
The Fund 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 Ohio.
4.02 It is empowered under applicable laws and by its charter and
By-Laws to enter into and perform this Agreement.
4.03 All corporate proceedings required by said charter and By-Laws
have been taken to authorize it to enter into and perform this Agreement.
4.04 It is an open-end and non-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 Fund being offered for
sale.
5. INDEMNIFICATION
5.01 MSS shall not be responsible for, and the Fund 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 Fund's refusal or failure to comply with the terms of
this Agreement, or which arise out of the Fund's lack of good faith,
gross negligence or willful misconduct or which arise out of the breach
of any representation or warranty of the Fund hereunder.
<PAGE>
(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 Fund, and (ii) have been prepared and/or maintained
by the Fund or any other person or firm on behalf of the Fund.
(d) The reliance on, or the carrying out by MSS or its agents
or subcontractors of, any instructions or requests of the Fund.
(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 Fund 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 Fund 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 Fund 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 Fund, 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 Fund, and shall not be held to have notice of
any change of authority of any person, until receipt of written notice thereof
from the Fund. 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 Fund, and
the proper countersignature of any former transfer agent or registrar, or of a
co-transfer agent or co-registrar.
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 FUND AND MSS
6.01 The Fund shall promptly furnish to MSS a certified copy of the
resolution of the Board of Directors of the Fund 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 Fund 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.
<PAGE>
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 Fund and will
be preserved, maintained and made available in accordance with such Section and
Rules, and will be surrendered promptly to the Fund on and in accordance with
its request.
6.04 MSS and the Fund 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 Fund, MSS will endeavor to notify the Fund and to
secure instructions from an authorized officer of the Fund 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 Fund of any unusual request to inspect or copy the
shareholder records of the Fund or the receipt of any other unusual request to
inspect, copy or produce the records of the Fund.
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 Fund exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Fund. 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 Directors of the Fund.
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 Fund: To MSS:
TriStar Investment Trust Mutual Shareholder Services
13605 Crestway Drive 1301 East Ninth Street, Suite 1005
Brook Park, Ohio 44142 Cleveland, OH 44114
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Fund: Mutual Shareholder Services, LLC
TriStar Investment Trust
By: /s/ Russell P. Stockhaus By:
Its: President Its: ___________________________
EXHIBIT 60.20
ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this 3rd day of December,
1999,by and between TriStar Investment Trust, a registered management investment
company (the "Fund"), and Mutual Shareholder Services LLC ("MSS").an Ohio
corporation.
RECITALS:
A. The Fund 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 Fund desires to avail itself of the experience, assistance
and facilities of MSS and to have MSS perform the Fund certain services
appropriate to the operations of the Fund, 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 Fund with the necessary office space,
communication facilities and personnel to perform the following services for the
Fund:
(a) Timely calculate and transmit to NASDAQ the daily net asset value of each
class of shares of each portfolio of the Fund, and communicate such value to the
Fund and its transfer agent;
(b) Maintain and keep current all books and records of the Fund 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 Fund 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 Fund or its authorized agents:
<PAGE>
o Cash receipts journal
o Cash disbursements journal
o Dividend record
o Purchase and sales - portfolio securities journals
o Subscription and redemption journals
o Security ledgers
o Broker ledger
o General ledger
o Daily expense accruals
o Daily income accruals
o Securities and monies borrowed or loaned and
collateral therefore
o Foreign currency journals
o Trial balances
(c) Provide the Fund 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 Fund or its investment Adviser 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 Fund in any way or otherwise be deemed an agent of the
Fund.
2. FEES AND EXPENSES.
(a) In consideration of the services to be performed by MSS
pursuant to this Agreement, the Fund 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 Fund 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 Fund will be reimbursed by the Fund.
(c) The Fund 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 Fund 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 Fund, advice
of the Fund, or of counsel for the Fund and upon statements of the
Fund'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 Fund to which MSS shall otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence in the performance of its
duties to the Fund, 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, directors, employees or
agents shall be subject to, and the Fund 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 Fund or its authorized agents.
4. REPORTS.
(a) The Fund shall provide to MSS on a quarterly basis a
report of a duly authorized officer of the Fund 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
Fund or its authorized agents, and the Fund 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 Fund 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 Fund 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
Fund, and shall be surrendered to the Fund promptly upon request by the Fund 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 Fund (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 Fund's independent auditors, or, upon approval of the Fund, any regulatory
body, in any requested review of the Fund'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 Fund.
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 Fund exercise its right to terminate, all out-of-pocket
expenses associated with the movements of records and material will be borne by
the Fund. 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.
(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.
<PAGE>
(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 Fund: To MSS:
TriStar Investment Trust Mutual Shareholder Services
13605 Crestway Drive 1301 East Ninth Street, Suite 1005
Brook Park, Ohio 44142 Cleveland, OH 44114
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
TriStar Investment Trust Mutual Shareholder Services, LLC.
By: Russell P. Stockhaus By: _____________________________
Its: President Its: ____________________________
EXHIBIT 70.10
CUSTODY AGREEMENT
This agreement (the "Agreement") is entered into as of the 3rd day of
December, 1999, by and between TriStar Capital Management Corp., (the
"Corporation"), a corporation organized under the laws of the State of Ohio and
having its office at 13605 Crestway Drive, Brook Park, Ohio 44142 acting for and
on behalf of TriStar Investment Trust (the "Fund"), which is operated and
maintained by the Corporation for the benefit of the holders of shares of each
Fund, and Firstar Bank, N.A. (the "Custodian"), a national banking association
having its principal office and place of business at Firstar Center, 425 Walnut
Street, Cincinnati, Ohio 45202.
WHEREAS, the Fund and the Custodian desire to enter into this Agreement
to provide for the custody and safekeeping of the assets of the Fund as required
by the Investment Company Act of 1940, as amended (the "Act").
WHEREAS, the Fund hereby appoints the Custodian as custodian of all the
Fund's Securities and moneys at any time owned by the Fund during the term of
this Agreement (the "Fund Assets").
WHEREAS, the Custodian hereby accepts such appointment as Custodian and
agrees to perform the duties thereof as hereinafter set forth.
THEREFORE, in consideration of the mutual promises hereinafter set
forth, the Fund and the Custodian agree as follows:
<PAGE>
ARTICLE I
Definitions
The following words and phrases, when used in this Agreement, unless
the context otherwise requires, shall have the following meanings:
Authorized Person - the Chairman, President, Secretary, Treasurer,
Controller, or Senior Vice President of the Fund, or any other person, whether
or not any such person is an officer or employee of the Fund, duly authorized by
the Board Of Directors of the Fund to give Oral Instructions and Written
Instructions on behalf of the Fund, and listed in the Certificate annexed hereto
as Appendix A, or such other Certificate as may be received by the Custodian
from time to time.
Book-Entry System - the Federal Reserve Bank book-entry system for
United States Treasury securities and federal agency securities.
Certificate- A written certificate signed by the Secretary of the Fund
certifying the actions taken by the Board of Directors.
Depository - The Depository Trust Company ("DTC"), a limited purpose
trust company its successor(s) and its nominee(s) or any other person or
clearing agent
Dividend and Transfer Agent - the dividend and transfer agent
appointed, from time to time, pursuant to a written agreement between the
dividend and transfer agent and the Fund
Foreign Securities - a) securities issued and sold primarily outside of
the United States by a foreign government, a national of any foreign country, or
a trust or other organization incorporated or organized under the laws of any
foreign country or; b) securities issued or guaranteed by the government of the
United States, by any state, by any political subdivision or agency thereof, or
by any entity organized under the laws of the United States or of any state
thereof, which have been issued and sold primarily outside of the United States.
Money Market Security - debt obligations issued or guaranteed as to
principal and/or interest by the government of the United States or agencies or
instrumentalities thereof, commercial paper, obligations (including certificates
of deposit, bankers' acceptances, repurchase agreements and reverse repurchase
agreements with respect to the same), and time deposits of domestic banks and
thrift institutions whose deposits are insured by the Federal Deposit Insurance
Corporation, and short-term corporate obligations where the purchase and sale of
such securities normally require settlement in federal funds or their equivalent
on the same day as such purchase and sale, all of which mature in not more than
thirteen (13) months.
Officers - the Chairman, President, Secretary, Treasurer, Controller,
and Senior Vice President of the Fund listed in the Certificate annexed hereto
as Appendix A, or such other Certificate as may be received by the Custodian
from time to time.
Oral Instructions - verbal instructions received by the Custodian from
an Authorized Person (or from a person that the Custodian reasonably believes in
good faith to be an Authorized Person) and confirmed by Written Instructions in
such a manner that such Written Instructions are received by the Custodian on
the business day immediately following receipt of such Oral Instructions.
Prospectus - the Fund's then currently effective prospectus and
Statement of Additional Information, as filed with and declared effective from
time to time by the Securities and Exchange Commission.
Security or Securities - Money Market Securities, common stock,
preferred stock, options, financial futures, bonds, notes, debentures, corporate
debt securities, mortgages, and any certificates, receipts, warrants, or other
instruments representing rights to receive, purchase, or subscribe for the same
or evidencing or representing any other rights or interest therein, or any
property or assets.
Written Instructions - communication received in writing by the
Custodian from an Authorized Person.
ARTICLE II
Documents and Notices to be Furnished by the Fund
A The following documents, including any amendments thereto, will be
provided contemporaneously with the execution of the Agreement, to the Custodian
by the Fund:
1. A copy of the Articles of Incorporation of the Fund certified
by the Secretary.
2. A copy of the By-Laws of the Fund certified by the Secretary.
3. A copy of the resolution of the Board Of Directors of the Fund
appointing the Custodian, certified by the Secretary.
4. A copy of the then current Prospectus.
5. A Certificate of the President and Secretary of the Fund
setting forth the names and signatures of the Officers of the Fund.
<PAGE>
B. The Fund agrees to notify the Custodian in writing of the
appointment of any Dividend and Transfer Agent.
ARTICLE III
Receipt of Fund Assets
A. During the term of this Agreement, the Fund will deliver or cause to
be delivered to the Custodian all moneys constituting Fund Assets. The Custodian
shall be entitled to reverse any deposits made on the Fund's behalf where such
deposits have been entered and moneys are not finally collected within 30 days
of the making of such entry.
B. During the term of this Agreement, the Fund will deliver or cause to
be delivered to the Custodian all Securities constituting Fund Assets. The
Custodian will not have any duties or responsibilities with respect to such
Securities until actually received by the Custodian.
C. As and when received, the Custodian shall deposit to the account(s)
of the Fund any and all payments for shares of the Fund issued or sold from time
to time as they are received from the Fund's distributor or Dividend and
Transfer Agent or from the Fund itself.
ARTICLE IV
Disbursement of Fund Assets
A. The Fund shall furnish to the Custodian a copy of the resolution of
the Board Of Directors of the Fund, certified by the Fund's Secretary, either
(i) setting forth the date of the declaration of any dividend or distribution in
respect of shares of the Fund, the date of payment thereof, the record date as
of which Fund shareholders entitled to payment shall be determined, the amount
payable per share to Fund shareholders of record as of that date, and the total
amount to be paid by the Dividend and Transfer Agent on the payment date, or
(ii) authorizing the declaration of dividends and distributions in respect of
shares of the Fund on a daily basis and authorizing the Custodian to rely on a
Certificate setting forth the date of the declaration of any such dividend or
distribution, the date of payment thereof, the record date as of which Fund
shareholders entitled to payment shall be determined, the amount payable per
share to Fund shareholders of record as of that date, and the total amount to be
paid by the Dividend and Transfer Agent on the payment date.
On the payment date specified in such resolution or
Certificate described above, the Custodian shall segregate such amounts from
moneys held for the account of the Fund so that they are available for such
payment.
<PAGE>
B. Upon receipt of Written Instructions so directing it, the Custodian
shall segregate amounts necessary for the payment of redemption proceeds to be
made by the Dividend and Transfer Agent from moneys held for the account of the
Fund so that they are available for such payment.
C. Upon receipt of a Certificate directing payment and setting forth
the name and address of the person to whom such payment is to be made, the
amount of such payment, and the purpose for which payment is to be made, the
Custodian shall disburse amounts as and when directed from the Fund Assets. The
Custodian is authorized to rely on such directions and shall be under no
obligation to inquire as to the propriety of such directions.
D. Upon receipt of a Certificate directing payment, the Custodian shall
disburse moneys from the Fund Assets in payment of the Custodian's fees and
expenses as provided in Article VIII hereof.
ARTICLE V
Custody of Fund Assets
A. The Custodian shall open and maintain a separate bank account or
accounts in the United States in the name of the Fund, subject only to draft or
order by the Custodian acting pursuant to the terms of this Agreement, and shall
hold all cash received by it from or for the account of the Fund, other than
cash maintained by the Fund in a bank account established and used by the Fund
in accordance with Rule 17f-3 under the Act. Moneys held by the Custodian on
behalf of the Fund may be deposited by the Custodian to its credit as Custodian
in the banking department of the Custodian. Such moneys shall be deposited by
the Custodian in its capacity as such, and shall be withdrawable by the
Custodian only in such capacity.
B. The Custodian shall hold all Securities delivered to it in
safekeeping in a separate account or accounts maintained at Firstar Bank, N.A.
for the benefit of the Fund.
C. All Securities held which are issued or issuable only in bearer
form, shall be held by the Custodian in that form; all other Securities held for
the Fund shall be registered in the name of the Custodian or its nominee. The
Fund agrees to furnish to the Custodian appropriate instruments to enable the
Custodian to hold, or deliver in proper form for transfer, any Securities that
it may hold for the account of the Fund and which may, from time to time, be
registered in the name of the Fund.
<PAGE>
D. With respect to all Securities held for the Fund , the Custodian
shall on a timely basis (concerning items 1 and 2 below, as defined in the
Custodian's Standards of Service Guide, as amended from time to time, annexed
hereto as Appendix C):
1.) Collect all income due and payable with respect to such
Securities; 2.) Present for payment and collect amounts payable
upon all Securities which may mature or be called, redeemed, or
retired, or otherwise become payable; 3.) Surrender Securities in
temporary form for definitive Securities; and 4.) Execute, as
agent, any necessary declarations or certificates of
ownership under the Federal income tax laws or the laws or regulations of any
other taxing authority, including any foreign taxing authority, now or hereafter
in effect.
E. Upon receipt of a Certificate and not otherwise, the Custodian
shall:
1.) Execute and deliver to such persons as may be designated in
such Certificate proxies, consents, authorizations, and any other instruments
whereby the authority of the Fund as beneficial owner of any Securities may be
exercised;
2.) Deliver any Securities in exchange for other Securities or
cash issued or paid in connection with the liquidation, reorganization,
refinancing, merger, consolidation, or recapitalization of any trust, or the
exercise of any conversion privilege;
3.) Deliver any Securities to any protective committee,
reorganization committee, or other person in connection with the reorganization
refinancing, merger, consolidation, recapitalization, or sale of assets of
any trust, and receive and hold under the terms of this Agreement such
certificates of deposit, interim receipts or other instruments or
documents as may be issued to it to evidence such delivery;
4.) Make such transfers or exchanges of the assets of the Fund and
take such other steps as shall be stated in said Certificate to be for the
purpose of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the Fund; and
5.) Deliver any Securities held for the Fund to the depository agent
for tender or other similar offers.
F. The Custodian shall promptly deliver to the Fund all notices, proxy
material and executed but unvoted proxies pertaining to shareholder meetings of
Securities held by the Fund. The Custodian shall not vote or authorize the
voting of any Securities or give any consent, waiver or approval with respect
thereto unless so directed by a Certificate or Written Instruction.
G. The Custodian shall promptly deliver to the Fund all information
received by the Custodian and pertaining to Securities held by the Fund with
respect to tender or exchange offers, calls for redemption or purchase, or
expiration of rights.
<PAGE>
ARTICLE VI
Purchase and Sale of Securities
A. Promptly after each purchase of Securities by the Fund, the Fund
shall deliver to the Custodian (i) with respect to each purchase of Securities
which are not Money Market Securities, Written Instructions, and (ii) with
respect to each purchase of Money Market Securities, Written Instructions or
Oral Instructions, specifying with respect to each such purchase the;
1.) name of the issuer and the title of the Securities,
2.) principal amount purchased and accrued interest, if
any,
3.) date of purchase and settlement,
4.) purchase price per unit,
5.) total amount payable, and
6.) name of the person from whom, or the broker through
which, the purchase was made.
The Custodian shall, against receipt of Securities purchased by or for the Fund,
pay out of the Fund Assets, the total amount payable to the person from whom or
the broker through which the purchase was made, provided that the same conforms
to the total amount payable as set forth in such Written Instructions or Oral
Instructions, as the case may be.
B. Promptly after each sale of Securities by the Fund, the Fund shall
deliver to the Custodian (i) with respect to each sale of Securities which are
not Money Market Securities, Written Instructions, and (ii) with respect to each
sale of Money Market Securities, Written Instructions or Oral Instructions,
specifying with respect to each such sale the;
1.) name of the issuer and the title of the Securities,
2.) principal amount sold and accrued interest, if any,
3.) date of sale and settlement,
4.) sale price per unit,
5.) total amount receivable, and
6.) name of the person to whom, or the broker through
which, the sale was made.
The Custodian shall deliver the Securities against receipt of the total amount
receivable, provided that the same conforms to the total amount receivable as
set forth in such Written Instructions or Oral Instructions, as the case may be.
<PAGE>
C. On contractual settlement date, the account of the Fund will be
charged for all purchased Securities settling on that day, regardless of whether
or not delivery is made. Likewise, on contractual settlement date, proceeds from
the sale of Securities settling that day will be credited to the account of the
Fund, irrespective of delivery.
D. Purchases and sales of Securities effected by the Custodian will be
made on a delivery versus payment basis. The Custodian may, in its sole
discretion, upon receipt of a Certificate, elect to settle a purchase or sale
transaction in some other manner, but only upon receipt of acceptable
indemnification from the Fund.
E. The Custodian shall, upon receipt of a Written Instructions so
directing it, establish and maintain a segregated account or accounts for and on
behalf of the Fund. Cash and/or Securities may be transferred into such account
or accounts for specific purposes, to-wit:
1.) in accordance with the provision of any agreement among
the Fund, the Custodian, and a broker-dealer registered under the Securities and
Exchange Act of 1934, as amended, and also a member of the National Association
of Securities Dealers (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,
the Commodity Futures Trading Commission, any registered contract market, or any
similar organization or organizations requiring escrow or other similar
arrangements in connection with transactions by the Fund;
2.) for purposes of segregating cash or government
securities in connection with options purchased, sold, or written by the Fund
or commodity futures contracts oroptions thereon purchased or sold by the Fund;
3.) for the purpose of compliance by the fund with the
procedures required for reverse repurchase agreements, firm commitment
agreements, standby commitment agreements, and short sales by Act Release
No. 10666, or any subsequent release or releases or rule of the Securities
and Exchange Commission relating to the maintenance of segregated accounts by
registered investment companies;and
4.) for other corporate purposes, only in the case of this
clause 4 upon receipt of a copy of a resolution of the Board Of Directors of the
Fund, certified by the Secretary of the Fund, setting forth the purposes of such
segregated account.
<PAGE>
F. Except as otherwise may be agreed upon by the parties hereto, the
Custodian shall not be required to comply with any Written Instructions to
settle the purchase of any Securities on behalf of the Fund unless there is
sufficient cash in the account(s) at the time or to settle the sale of any
Securities from an account(s) unless such Securities are in deliverable form.
Notwithstanding the foregoing, if the purchase price of such Securities exceeds
the amount of cash in the account(s) at the time of such purchase, the Custodian
may, in its sole discretion, advance the amount of the difference in order to
settle the purchase of such Securities. The amount of any such advance shall be
deemed a loan from the Custodian to the Fund payable on demand and bearing
interest accruing from the date such loan is made up to but not including the
date such loan is repaid at a rate per annum customarily charged by the
Custodian on similar loans.
ARTICLE VII
Fund Indebtedness
In connection with any borrowings by the Fund, the Fund will cause to
be delivered to the Custodian by a bank or broker requiring Securities as
collateral for such borrowings (including the Custodian if the borrowing is from
the Custodian), a notice or undertaking in the form currently employed by such
bank or broker setting forth the amount of collateral. The Fund shall promptly
deliver to the Custodian a Certificate specifying with respect to each such
borrowing: (a) the name of the bank or broker, (b) the amount and terms of the
borrowing, which may be set forth by incorporating by reference an attached
promissory note duly endorsed by the Fund, or a loan agreement, (c) the date,
and time if known, on which the loan is to be entered into, (d) the date on
which the loan becomes due and payable, (e) the total amount payable to the Fund
on the borrowing date, and (f) the description of the Securities securing the
loan, including the name of the issuer, the title and the number of shares or
the principal amount. The Custodian shall deliver on the borrowing date
specified in the Certificate the required collateral against the lender's
delivery of the total loan amount then payable, provided that the same conforms
to that which is described in the Certificate. The Custodian shall deliver, in
the manner directed by the Fund, such Securities as additional collateral, as
may be specified in a Certificate, to secure further any transaction described
in this Article VII. The Fund shall cause all Securities released from
collateral status to be returned directly to the Custodian and the Custodian
shall receive from time to time such return of collateral as may be tendered to
it.
The Custodian may, at the option of the lender, keep such collateral in
its possession, subject to all rights therein given to the lender because of the
loan. The Custodian may require such reasonable conditions regarding such
collateral and its dealings with third-party lenders as it may deem appropriate.
<PAGE>
ARTICLE VIII
Concerning the Custodian
A. Except as otherwise provided herein, the Custodian shall not be
liable for any loss or damage resulting from its action or omission to act or
otherwise, except for any such loss or damage arising out of its own gross
negligence or willful misconduct. The Fund shall defend, indemnify and hold
harmless the Custodian and its directors, officers, employees and agents with
respect to any loss, claim, liability or cost (including reasonable attorneys'
fees) arising or alleged to arise from or relating to the Fund's duties
hereunder or any other action or inaction of the Fund or its Directors,
officers, employees or agents, except such as may arise from the negligent
action, omission, willful misconduct or breach of this Agreement by the
Custodian. The Custodian may, with respect to questions of law, apply for and
obtain the advice and opinion of counsel, at the expense of the Fund, and shall
be fully protected with respect to anything done or omitted by it in good faith
in conformity with the advice or opinion of counsel. The provisions under this
paragraph shall survive the termination of this Agreement.
B. Without limiting the generality of the foregoing, the Custodian,
acting in the capacity of Custodian hereunder, shall be under no obligation to
inquire into, and shall not be liable for:
1.) The validity of the issue of any Securities
purchased by or for the account of the Fund, the legality of the purchase
thereof, or the propriety of the amount paid therefor;
2.) The legality of the sale of any Securities by or for
the account of the Fund, or the propriety of the amount for which the same are
sold;
3.) The legality of the issue or sale of any shares of
the Fund, or the sufficiency of the amount to be received therefor;
4.) The legality of the redemption of any shares of the
Fund, or the propriety of the amount to be paid therefor;
5.) The legality of the declaration or payment of any
dividend by the Fund in respect of shares of the Fund;
6.) The legality of any borrowing by the Fund on behalf
of the Fund, using Securities as collateral;
<PAGE>
C. The Custodian shall not be under any duty or obligation to take
action to effect collection of any amount due to the Fund from any Dividend and
Transfer Agent of the Fund nor to take any action to effect payment or
distribution by any Dividend and Transfer Agent of the Fund of any amount paid
by the Custodian to any Dividend and Transfer Agent of the Fund in accordance
with this Agreement.
D. Notwithstanding Section D of Article V, the Custodian shall not be
under any duty or obligation to take action to effect collection of any amount,
if the Securities upon which such amount is payable are in default, or if
payment is refused after due demand or presentation, unless and until (i) it
shall be directed to take such action by a Certificate and (ii) it shall be
assured to its satisfaction (including prepayment thereof) of reimbursement of
its costs and expenses in connection with any such action.
E. The Fund acknowledges and hereby authorizes the Custodian to hold
Securities through its various agents described in Appendix B annexed hereto.
The Fund hereby represents that such authorization has been duly approved by the
Board Of Directors of the Fund as required by the Act. The Custodian
acknowledges that although certain Fund Assets are held by its agents, the
Custodian remains primarily liable for the safekeeping of the Fund Assets.
In addition, the Fund acknowledges that the Custodian may appoint one
or more financial institutions, as agent or agents or as sub-custodian or
sub-custodians, including, but not limited to, banking institutions located in
foreign countries, for the purpose of holding Securities and moneys at any time
owned by the Fund. The Custodian shall not be relieved of any obligation or
liability under this Agreement in connection with the appointment or activities
of such agents or sub-custodians. Any such agent or sub-custodian shall be
qualified to serve as such for assets of investment companies registered under
the Act. Upon request, the Custodian shall promptly forward to the Fund any
documents it receives from any agent or sub-custodian appointed hereunder which
may assist trustees of registered investment companies fulfill their
responsibilities under Rule 17f-5 of the Act.
<PAGE>
F. The Custodian shall not be under any duty or obligation to ascertain
whether any Securities at any time delivered to or held by it for the account of
the Fund are such as properly may be held by the Fund under the provisions of
the Articles of Incorporation and the Fund's By-Laws.
G. The Custodian shall treat all records and other information relating
to the Fund and the Fund Assets as confidential and shall not disclose any such
records or information to any other person unless (i) the Fund shall have
consented thereto in writing or (ii) such disclosure is required by law.
H. The Custodian shall be entitled to receive and the Fund agrees to
pay to the Custodian such compensation as shall be determined pursuant to
Appendix D attached hereto, or as shall be determined pursuant to amendments to
such Appendix D. The Custodian shall be entitled to charge against any money
held by it for the account of the Fund, the amount of any of its fees, any loss,
damage, liability or expense, including counsel fees. The expenses which the
Custodian may charge against the account of the Fund include, but are not
limited to, the expenses of agents or sub-custodians incurred in settling
transactions involving the purchase and sale of Securities of the Fund.
I. The Custodian shall be entitled to rely upon any Oral Instructions
and any Written Instructions. The Fund agrees to forward to the Custodian
Written Instructions confirming Oral Instructions in such a manner so that such
Written Instructions are received by the Custodian, whether by hand delivery,
facsimile or otherwise, on the same business day on which such Oral Instructions
were given. The Fund agrees that the failure of the Custodian to receive such
confirming instructions shall in no way affect the validity of the transactions
or enforceability of the transactions hereby authorized by the Fund. The Fund
agrees that the Custodian shall incur no liability to the Fund for acting upon
Oral Instructions given to the Custodian hereunder concerning such transactions.
J. The Custodian will (i) set up and maintain proper books of account
and complete records of all transactions in the accounts maintained by the
Custodian hereunder in such manner as will meet the obligations of the Fund
under the Act, with particular attention to Section 31 thereof and Rules 31a-1
and 31a-2 thereunder and those records are the property of the Fund, and (ii)
preserve for the periods prescribed by applicable Federal statute or regulation
all records required to be so preserved. All such books and records shall be the
property of the Fund, and shall be open to inspection and audit at reasonable
times and with prior notice by Officers and auditors employed by the Fund.
<PAGE>
K. The Custodian shall send to the Fund any report received on the
systems of internal accounting control of the Custodian, or its agents or
sub-custodians, as the Fund may reasonably request from time to time.
L. The Custodian performs only the services of a custodian and shall
have no responsibility for the management, investment or reinvestment of the
Securities from time to time owned by the Fund. The Custodian is not a selling
agent for shares of the Fund and performance of its duties as custodian shall
not be deemed to be a recommendation to the Fund's depositors or others of
shares of the Fund as an investment.
M. The Custodian shall take all reasonable action, that the Fund may
from time to time request, to assist the Fund in obtaining favorable opinions
from the Fund's independent accountants, with respect to the Custodian's
activities hereunder, in connection with the preparation of the Fund's Form
N-1A, Form N-SAR, or other annual reports to the Securities and Exchange
Commission.
N. The Fund hereby pledges to and grants the Custodian a security
interest in any Fund Assets to secure the payment of any liabilities of the Fund
to the Custodian, whether acting in its capacity as Custodian or otherwise, or
on account of money borrowed from the Custodian. This pledge is in addition to
any other pledge of collateral by the Fund to the Custodian.
<PAGE>
ARTICLE IX
Force Majeure
Neither the Custodian nor the Corporation 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; 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 such failure or delay.
ARTICLE X
Termination
A. Either of the parties hereto may terminate this Agreement for any
reason 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 giving of such notice. If such notice is given by the Fund, it shall be
accompanied by a copy of a resolution of the Board Of Directors of the Fund,
certified by the Secretary of the Fund, electing to terminate this Agreement and
designating a successor custodian or custodians. In the event such notice is
given by the Custodian, the Fund shall, on or before the termination date,
deliver to the Custodian a copy of a resolution of the Board Of Directors of the
Fund, certified by the Secretary, designating a successor custodian or
custodians to act on behalf of the Fund. In the absence of such designation by
the Fund, the Custodian may designate a successor custodian which shall be a
bank or trust company having not less than $100,000,000 aggregate capital,
surplus, and undivided profits. Upon the date set forth in such notice this
Agreement shall terminate, and the Custodian, provided that it has received a
notice of acceptance by the successor custodian, shall deliver, on that date,
directly to the successor custodian all Securities and moneys then owned by the
Fund and held by it as Custodian. Upon termination of this Agreement, the Fund
shall pay to the Custodian on behalf of the Fund such compensation as may be due
as of the date of such termination. The Fund agrees on behalf of the Fund that
the Custodian shall be reimbursed for its reasonable costs in connection with
the termination of this Agreement.
<PAGE>
B. If a successor custodian is not designated by the Fund, or by the
Custodian in accordance with the preceding paragraph, or the designated
successor cannot or will not serve, the Fund shall, upon the delivery by the
Custodian to the Fund of all Securities (other than Securities held in the
Book-Entry System which cannot be delivered to the Fund) and moneys then owned
by the Fund, be deemed to be the custodian for the Fund, and the Custodian shall
thereby be relieved of all duties and responsibilities pursuant to this
Agreement, other than the duty with respect to Securities held in the Book-Entry
System, which cannot be delivered to the Fund, which shall be held by the
Custodian in accordance with this Agreement.
ARTICLE XI
MISCELLANEOUS
A. Appendix A sets forth the names and the signatures of all Authorized
Persons, as certified by the Secretary of the Fund. The Fund agrees to furnish
to the Custodian a new Appendix A in form similar to the attached Appendix A, if
any present Authorized Person ceases to be an Authorized Person or if any other
or additional Authorized Persons are elected or appointed. Until such new
Appendix A shall be received, the Custodian shall be fully protected in acting
under the provisions of this Agreement upon Oral Instructions or signatures of
the then current Authorized Persons as set forth in the last delivered Appendix
A.
B. No recourse under any obligation of this Agreement or for any claim
based thereon shall be had against any organizer, shareholder, Officer,
Director, past, present or future as such, of the Fund or of any predecessor or
successor, either directly or through the Fund or any such predecessor or
successor, whether by virtue of any constitution, statute or rule of law or
equity, or be the enforcement of any assessment or penalty or otherwise; it
being expressly agreed and understood that this Agreement and the obligations
thereunder are enforceable solely against the Fund, and that no such personal
liability whatever shall attach to, or is or shall be incurred by, the
organizers, shareholders, Officers, Directors of the Fund or of any predecessor
or successor, or any of them as such. To the extent that any such liability
exists, it is hereby expressly waived and released by the Custodian as a
condition of, and as a consideration for, the execution of this Agreement.
<PAGE>
C. The obligations set forth in this Agreement as having been made by
the Fund have been made by the Board Of Directors, acting as such Directors for
and on behalf of the Fund, pursuant to the authority vested in them under the
laws of the State of Ohio, the Articles of Incorporation and the By-Laws of the
Fund. This Agreement has been executed by Officers of the Fund as officers, and
not individually, and the obligations contained herein are not binding upon any
of the Directors, Officers, agents or holders of shares, personally, but bind
only the Fund.
D. Provisions of the Prospectus and any other documents (including
advertising material) specifically mentioning the Custodian (other than merely
by name and address) shall be reviewed with the Custodian by the Fund prior to
publication and/or dissemination or distribution, and shall be subject to the
consent of the Custodian.
E. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Custodian, shall be sufficiently given if
addressed to the Custodian and mailed or delivered to it at its offices at
Firstar Center, 425 Walnut Street, M. L. 6118, Cincinnati, Ohio 45202, attention
Mutual Fund Custody Department, or at such other place as the Custodian may from
time to time designate in writing.
F. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund shall be sufficiently given when
delivered to the Fund or on the second business day following the time such
notice is deposited in the U.S. mail postage prepaid and addressed to the Fund
at its office at 13605 Crestway Drive, Brook Park, Ohio 44142 or at such other
place as the Fund may from time to time designate in writing.
G. This Agreement, with the exception of the Appendices, may not be
amended or modified in any manner except by a written agreement executed by both
parties with the same formality as this Agreement, and authorized and approved
by a resolution of the Board Of Directors of the Fund.
<PAGE>
H. This Agreement shall extend to and shall be binding upon the parties
hereto, and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Fund or by the Custodian, and no
attempted assignment by the Fund or the Custodian shall be effective without the
written consent of the other party hereto.
I. This Agreement shall be construed in accordance with the laws
of the State of Ohio.
J. This Agreement may be executed in any number of counterparts,
each of which shall be deemed tobe an original, but such counterparts shall,
together, constitute only one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective Officers, thereunto duly authorized as of the day
and year first above written.
ATTEST: _
By:
Title:
ATTEST: Firstar Bank, N.A.
By:
Marsha A. Croxton
Senior Vice President
<PAGE>
APPENDIX A
Authorized Persons Specimen Signatures
Chairman:
------------ --------------
President: ------------ --------------
Secretary: ------------ --------------
Treasurer: ------------ --------------
Controller: ------------ --------------
Adviser Employees: ------------ --------------
Transfer Agent/Fund Accountant
Employees: ------------ --------------
------------ --------------
------------ --------------
<PAGE>
APPENDIX B
The following agents are employed currently by Firstar Bank, N.A. for securities
processing and control . . .
The Depository Trust Company (New York)
7 Hanover Square
New York, NY 10004
The Federal Reserve Bank
Cincinnati and Cleveland Branches
Bank of New York
1 Wall St
New York, NY 10286
(For Foreign Securities and certain non-DTC eligible Securities)
<PAGE>
APPENDIX C
Standards of Service Guide
Standard of Services Guide
Firstar Institutional Custody Services
425 Walnut Street, 6th Floor
M.L. 6118
Cincinnati, OH 45202
July, 1999
<PAGE>
Firstar Institutional Custody Services
Standards of Service Guide
Firstar Bank, N.A. is committed to providing superior quality service
to all customers and their agents at all times. We have compiled this guide as a
tool for our clients to determine our standards for the processing of security
settlements, payment collection, and capital change transactions. Deadlines
recited in this guide represent the times required for Firstar Bank to guarantee
processing. Failure to meet these deadlines will result in settlement at our
client's risk. In all cases, Firstar Bank will make every effort to complete all
processing on a timely basis.
Firstar Bank is a direct participant of the Depository Trust Company, a
direct member of the Federal Reserve Bank of Cleveland, and utilizes the Bankers
Trust Company as its agent for ineligible and foreign securities.
For corporate reorganizations, Firstar Bank utilizes SEI's Reorg
Source, Financial Information, Inc., XCITEK, DTC Important Notices, and the Wall
Street Journal.
For bond calls and mandatory puts, Firstar Bank utilizes SEI's Bond
Source, Kenny Information Systems, Standard & Poor's Corporation, and DTC
Important Notices. Firstar Bank will not notify clients of optional put
opportunities.
Any securities delivered free to Firstar Bank or its agents must be
received three (3) business days prior to any payment or settlement in order for
the Firstar Bank standards of service to apply.
Should you have any questions regarding the information contained in
this guide, please feel free to contact your account representative.
The information contained in this Standards of Service Guide
is subject to change. Should any changes be made Firstar Bank
will provide you with an updated copy of its Standards of
Service Guide.
<PAGE>
Firstar Bank Security Settlement Standards
Transaction Type Instructions Deadlines* Delivery Instructions
DTC 1:30 P.M. on DTC Participant# 2803
Settlement Date Agent Bank ID 27895
Institutional#
For Account#
Federal Reserve Book Entry 12:30 P.M. on Federal Reserve Bank
Settlement Date of Cinti/Trust for
Firstar Bank, N.A.
ABA# 042000013
For Account#
Fed Wireable FNMA & FHLMC 12:30 P.M. on Bk of NYC/Cust
Settlement Date ABA 021000018
A/C Firstar Bank #117612
Account#
Federal Reserve Book 1:00 P.M. on Federal Reserve Bank of
Entry (Repurchase Agreement Settlement Date Cinti/Spec for Firstar
Colateral Only) Bank, N.A. ABA# 042000013
For Account#
PTC Securities (GNMA Book 12:00 P.M. on PTC For Account BYORK
Entry) Settlement Date Firstar Bank / 117612
Physical Securities 9:30 A.M. EST on Bank of New York
Settlement Date One Wall Street-#3rd
(For Deliveries, by Floor-Window A
4:00 PM on Settlement New York, NY 10286
Date minus 1) For account of Firstar
Bank/Cust# 117612
Attn: Donald Hoover
CEDEL/EURO-CLEAR 11:00 A..M. on Cedel a/c 55021
Settlement Date FFC: a/c 387000
minus 2 Firstar Bank / Global
Omnibus
Cash Wire Transfer 3:00 P.M. Firstar Bank,N.A. Cinti/
Trust ABA# 042000013
Credit Account# 9901877
Further Credit to_______
Account# _______________
* All times listed are Eastern Standard Time.
<PAGE>
Firstar Bank Payment Standards
Security Type Income Principal
Equities Payable Date
Municipal Bonds* Payable Date Payable Date
Corporate Bonds* Payable Date Payable Date
Federal Reserve Bank Book Entry* Payable Date Payable Date
PTC GNMA's (P&I) Payable Date + 1 Payable Date + 1
CMOs *
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
SBA Loan Certificates When Received When Received
Unit Investment Trust Certificates* Payable Date Payable Date
Certificates of Deposit* Payable Date + 1 Payable Date + 1
Limited Partnerships When Received When Received
Foreign Securities When Received When Received
*Variable Rate Securities
Federal Reserve Bank Book Entry Payable Date Payable Date
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
NOTE: If a payable date falls on a weekend or bank holiday, payment will be
made on the immediately following business day.
<PAGE>
<TABLE>
<CAPTION>
Firstar Bank Corporate Reorganization Standards
Type of Action Notification to Client Deadline for Client Transaction
Instructions
<S> <C> <C> <C>
Rights, Warrants, Later of 10 business 5 business days prior Upon receipt
And Optional Mergers days prior to expiration to expiration
or receipt of notice
Mandatory Puts with Later of 10 business 5 business days prior Upon receipt
Option to Retain days prior to expiration to expiration
or receipt of notice
Class Actions 10 business days prior 5 business days prior Upon receipt
to expiration date to expiration
Voluntary Tenders, Later of 10 business 5 business days prior Upon receipt
Exchanges and days prior to expiration to expiration
Conversions or receipt of notice
Mandatory Puts, Defaults, At posting of funds or None Upon receipt
Liquidation, Bankruptcies, securities received
Stock Splits, Mandatory
Exchanges
Full and Partial Calls Later of 10 business None Upon receipt
days prior to expiration
or receipt of notice
<FN>
NOTE: Fractional shares/par amounts resulting from any of the above will be sold.
</FN>
</TABLE>
<PAGE>
APPENDIX D
Schedule of Compensation
Exhibit 80.10
Legal Opinion and Letter of Counsel
November 30, 1999
Board of Trustee
TriStar Investment Trust
13605 Crestway Drive
Brook Park, Ohio 44142-2675
Re: Registration Statement on Form N-1A Covering Offering of
Beneficial Interests of TriStar Investment Trust
Gentlemen:
We have acted as counsel to Tri-Star Investment Trust, an Ohio 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 Ohio, 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/pak
Exhibit 90.10
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to all references to our
firm included in or made a part of this Pre-Effective Amendment No. 2 to the
TriStar Investment Trust's Registration Statement on Form N-1A (File No.
333-92421), including the reference to our firm under the heading "ACCOUNTANTS"
in the Statement of Additional Information.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
April 10, 2000
<PAGE>
