Registration No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
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Post-Effective Amendment No. [ ]
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REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. [ ]
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DAVIS PARK SERIES TRUST
(Exact name of registrant as specified in charter)
P.O. Box 6919, Moraga, California 94570
(Address of principal executive offices)
Registrant's Telephone Number: (800) 394-5064
Nicholas D. Gerber, P.O. Box 6919, Moraga, California 94570
(Name and address of agent for service)
Copy to:
Michael J. Meaney, Esq.
McDonald, Hopkins, Burke & Haber Co., L.P.A.
2100 Bank One Center, 600 Superior Avenue, East, Cleveland, Ohio 44114
Approximate date of proposed public offering: January 1, 2001
<PAGE>
Prospectus
Ameristock Large Company Growth Fund
Ameristock Focused Value Fund
P.O. Box 6919
Moraga, CA 94570
(800) 394-5064
www.ameristock.com
Minimum Investment: $1,000
Sales Charge: None, 100% No-Load
12(b)1 Fee: None
Redemption Fee:
Ameristock Large Company
Growth Fund: None
Ameristock Focused Value Fund 1.00% if shares redeemed
within 3 years of purchase
Ameristock Large Company Growth Fund is a mutual fund with an investment
objective of seeking capital appreciation. This Fund pursues its objective by
investing primarily in equity securities of large capitalization companies
headquartered in the United States.
Ameristock Focused Value Fund is a mutual fund with an investment objective of
seeking capital appreciation. This Fund pursues its objective by investing
primarily in equity securities of companies of all sizes headquartered in the
United States.
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
Prospectus. Any representation to the contrary is a criminal offense.
January 1, 2001
TABLE OF CONTENTS
Risk/Return Summary - Ameristock Large Company
Growth Fund
Risk/Return Summary - Ameristock Focused
Value Fund
Fees and Expenses
How to Buy Shares
How to Redeem Shares
Net Asset Value
Investment Management
Dividends and Taxes
Other Information
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<PAGE>
RISK/RETURN SUMMARY - AMERISTOCK LARGE COMPANY GROWTH FUND
Investment Objective
The investment objective of Ameristock Large Company Growth Fund is to seek
capital appreciation.
Principal Investment Strategies
Ameristock Large Company Growth Fund pursues its investment objective
principally by investing in equity securities of large capitalization companies
headquartered in the United States. Generally, a large capitalization company is
one with a market capitalization of at least $15 billion. Equity securities
consist of common stock, preferred stock and securities convertible into common
or preferred stock.
This Fund emphasizes a "growth" style of investing. In selecting equity
securities, the Fund will seek to invest in companies which have high earnings
growth rates and which currently demonstrate superior long term capital
appreciation relative to other equity securities and the S&P 500 Index. The Fund
will sell a stock when the Fund's investment adviser decides that it no longer
meets these investment criteria.
Under normal conditions, this Fund will invest at least 80% of the value of its
total assets in accordance with the investment strategies described above.
However, the Fund may temporarily invest a lower percentage of its assets in
accordance with such strategies in the event of a domestic or international
event which has significantly disrupted, or in the opinion of the Fund's
investment adviser will materially disrupt, the stock market. If the Fund does
so, the Fund may not achieve its investment objective.
Principal Risks
Investment in Ameristock Large Company Growth Fund is subject to the following
principal risks:
The value of securities in the Fund's portfolio will go up and
down. Consequently, the Fund's share price may decline and you
could lose money.
The stock market is subject to significant fluctuations in
value as a result of political, economic and market
developments. If the stock market declines in value, the Fund
is likely to decline in value.
Because of changes in the financial condition or prospects of
specific companies, the individual stocks selected by the Fund
may decline in value, thereby causing the Fund to decline in
value.
"Growth" stocks generally are more expensive relative to their
earnings or assets than other types of stocks. Consequently,
these stocks are more volatile than other types of stocks. In
particular, growth stocks are very sensitive to changes in
their earnings. Negative developments in this regard could
cause a stock to decline dramatically, resulting in a decrease
in the Fund's share price.
An investment in the Fund is not a deposit of any
bank and is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other
governmental agency.
<PAGE>
Bar Chart and Performance Table
A bar chart and performance table is not provided since this Fund has not had
annual returns for a full calendar year.
RISK/RETURN SUMMARY - AMERISTOCK FOCUSED VALUE FUND
Investment Objective
The investment objective of Ameristock Focused Value Fund is to seek capital
appreciation.
Principal Investment Strategies
Ameristock Focused Value Fund pursues its investment objective principally by
investing in equity securities of companies of all sizes headquartered in the
United States. Equity securities consist of common stock, preferred stock and
securities convertible into common or preferred stock.
This Fund emphasizes a "value" style of investing. For example, shares of
companies with lower ratios of share price to earnings, sales and book value and
higher dividend yields than those of other companies will be considered
attractive investments. This Fund may also invest in companies which the Fund's
investment adviser believes are being undervalued by the securities markets due
to operating losses, litigation or other circumstances which may have depressed
share prices. However, to a lesser extent the Fund will often also invest in
"growth" stocks in order to be represented in that portion of the stock market.
The Fund will sell a stock when the Fund's investment adviser decides that it no
longer meets these investment criteria.
This Fund also may invest in corporate debt securities of companies
headquartered in the United States. Such debt securities may include investment
grade securities (those rated within the top categories of safety according to
rating service companies) as well as lower rated securities, sometimes referred
to as "junk bonds," which have speculative characteristics.
Under normal conditions, this Fund will invest at least 65% of the value of its
total assets in accordance with the investment strategies described above.
However, the Fund may temporarily invest a lower percentage of its assets in
accordance with such strategies in the event of a domestic or international
event which has significantly disrupted, or in the opinion of the Fund's
investment adviser will materially disrupt, the stock market. If the Fund does
so, the Fund may not achieve its investment objective.
Principal Risks
Investment in Ameristock Focused Value Fund is subject to the following
principal risks:
The value of securities in the Fund's portfolio will go up and
down. Consequently, the Fund's share price may decline and you
could lose money.
<PAGE>
The stock market is subject to significant fluctuations in
value as a result of political, economic and market
developments. If the stock market declines in value, the Fund
is likely to decline in value.
Because of changes in the financial condition or prospects of
specific companies, the individual stocks selected by the Fund
may decline in value, thereby causing the Fund to decline in
value.
While this Fund invests in both smaller and larger companies,
the smaller companies in which this Fund invests are
especially sensitive to the factors described above and
therefore may be subject to greater share price fluctuations
than other companies. Also, securities of these smaller
companies are often less liquid, thus possibly limiting the
ability of this Fund to dispose of such securities when the
Adviser deems it desirable to do so. As a result of these
factors, securities of these smaller companies may expose
shareholders of this Fund to above average risk.
There is no assurance that the Fund's "value" style of
investing will achieve its desired result. In fact, the Fund
may decline in value as a result of emphasizing this style of
investing.
"Growth" stocks generally are more expensive relative to their
earnings or assets than other types of stocks. Consequently,
these stocks are more volatile than other types of stocks. In
particular, growth stocks are very sensitive to changes in
their earnings. Negative developments in this regard could
cause a stock to decline dramatically, resulting in a decrease
in the Fund's share price.
This Fund's portfolio will also be exposed to the following
additional risks in connection with its investments in
corporate debt securities:
- Prices of debt securities rise and fall in response
to interest rate changes for similar securities.
Generally, when interest rates rise, prices of debt
securities fall. The net asset value of this Fund may
decrease during periods of rising interest rates.
- An issuer of debt securities may default (fail to
repay interest and principal when due). If an issuer
defaults or the risk of such default is perceived to
have increased, this Fund will lose all or part of
its investment. The net asset value of the Fund may
fall during periods of economic downturn when such
defaults or risk of defaults increase.
- Securities rated below investment grade, also known
as junk bonds, generally entail greater risks than
investment grade securities. For example, their
prices are more volatile, their values are more
negatively impacted by economic downturns, and their
trading market may be more limited.
This Fund is a "non-diversified" fund. The Fund is considered
"non-diversified" because, compared to other funds, a higher
percentage of the Fund's assets may be invested in the shares
of a limited number of companies. The Fund's portfolio
securities, therefore, may be more susceptible to a decline in
value as a result of any single economic, political, or
regulatory occurrence than the portfolio securities of a
"diversified" fund.
An investment in the Fund is not a deposit of any bank and is
not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other governmental agency.
<PAGE>
Bar Chart and Performance Table
A bar chart and performance table is not provided since this Fund has not had
annual returns for a full fiscal year.
FEES AND EXPENSES
This table describes the fees and expenses that you may pay if you buy and hold
shares of either Fund.
Shareholder Fees (fees paid directly from your investment)
Large Company Focused Value
Growth Fund Fund
Maximum Sales Charge (Load) Imposed on Purchases None None
Maximum Deferred Sales Charge (Load) None None
Redemption Fee None 1.00%*
*Payable only if shares redeemed within
3 years of purchase.
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)
Large Company Focused Value
Growth Fund Fund
Management Fees 1.00% 1.35%
Distribution (12b-1) Fees 0.00% 0.00%
Other Expenses 0.00% 0.00%
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Total Annual Fund Operating Expenses 1.00% 1.35%
Example: This Example is intended to help you compare the cost of investing in
either Fund with the cost of investing in other mutual funds. The Example
assumes that you invest $10,000 in a 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% return each year, that all dividends and
distributions are reinvested and that the Fund's operating expenses remain the
same. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:
<PAGE>
1 year 3 years
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Large Company Growth Fund $102 $318
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Focused Value Fund $237 $428
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HOW TO BUY SHARES
Shares of each Fund are purchased at the net asset value per share (as described
in "Net Asset Value" below) next determined after receipt of your investment in
proper form as described below. There are no sales charges. The minimum initial
investment is $1,000 and minimum subsequent investments (excluding reinvestments
of dividends and capital gains) is $100.
To purchase shares, complete and sign the Application to Buy Shares (or
investment stub in the case of a subsequent purchase) and mail it, together with
your check payable to Ameristock Large Company Growth Fund or Ameristock Focused
Value Fund, to:
Mutual Shareholder Services
1301 East Ninth Street, Suite 1005
Cleveland, Ohio 44114
To purchase shares by wire, transmit funds to:
Firstar Bank, N.A.
Cinti/Trust
ABA#: 0420-0001-3
F/F/C Account No.
---------------
Ameristock Mutual Fund
DDA (Star Bank Trust)
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Your investment will be considered to be in "proper form" if it includes a check
or wire funds transmission together with a completed Application to Buy Shares
or (in the case of a subsequent purchase) a completed investment stub from a
previous purchase or sale confirmation.
Each investment in a Fund, including dividends and capital gains distributions
reinvested in the Fund, is acknowledged by a statement showing the number of
shares purchased, the net asset value at which the shares are purchased, and the
new balance of Fund shares owned. For reasons of economy and convenience, the
Fund will not issue certificates for shares purchased.
You may purchase or sell Fund shares through a broker-dealer, bank or other
financial institution, or an organization that provides recordkeeping and
consulting services to 401(k) plans or other employee benefit plans (a
"Processing Organization"). Processing Organizations may charge you a fee for
this service and may require different minimum initial and subsequent
investments than the Fund. Processing Organizations may also impose other
charges or restrictions different from those applicable to shareholders who
invest in the Fund directly. Therefore, it may cost more for you to purchase
shares through a Processing Organization than to purchase shares directly from
the Fund. A Processing Organization, rather than its customers, may be the
shareholder of record of your shares. Neither Fund is responsible for the
failure of any Processing Organization to carry out its obligations to its
customers. Certain Processing Organizations may receive compensation from
Ameristock Corporation.
<PAGE>
Each Fund reserves the right not to accept purchase orders under circumstances
or in amounts considered disadvantageous to existing shareholders.
HOW TO REDEEM SHARES
General
You may redeem (sell) your shares at any time. Each Fund makes payment by check
for the shares redeemed within seven days after it receives a properly completed
redemption request (in accordance with the procedures described in "Redemption
by Mail" or "Redemption by Telephone," below), except as described below. The
redemption price per share is the net asset value determined as described under
"Net Asset Value", less any applicable redemption fee as described below under
"Redemption Fee". Because net asset value fluctuates, the amount received upon
redemption may be more or less than the amount paid for the shares.
Where an investor requests wire payment, the Transfer Agent will normally wire
the redemption proceeds the next business day by federal funds only to the bank
and account designated on the Application to Buy Shares, or in written
instructions subsequently received by the Transfer Agent, and only if the bank
is a commercial bank that is a member of the Federal Reserve System. The
Transfer Agent currently charges a $20.00 fee for each payment made by wire of
redemption proceeds, which fee will be deducted from the investor's account.
Payment of redemption proceeds with respect to shares purchased by check will
not be made until the check or payment received for investment has cleared,
which may take up to 11 business days.
Each Fund reserves the right to suspend or postpone redemptions during any
period: (i) when trading on the New York Stock Exchange is restricted, (ii)
when, as a result of an emergency, it is not reasonably practicable for the Fund
to dispose of, or determine the fair market value of, its net assets or (iii) as
the Securities and Exchange Commission may by order permit for the protection of
shareholders of the Fund. If the net asset value of the shares in an account is
less than $1,000 as a result of previous redemptions and not market declines,
the Fund may notify the shareholder that unless the account value is increased
to at least the minimum within 60 days the Fund will redeem all shares in the
account and pay the redemption price to the shareholder.
Redemption Fee - Ameristock Focused Value Fund
A redemption fee of 1% payable to and retained by Ameristock Focused Value Fund
is imposed on any redemption of shares within three years of the date of
purchase. The 1% fee is imposed on the net asset value of the redeemed shares at
the time of purchase. No redemption fee will be imposed on shares acquired
through reinvestment of dividends or capital gain distributions or on increases
in the net asset value of an investor's shares above the net asset value at the
time of purchase.
In determining whether a redemption fee is applicable to a redemption, the
calculation will be made in a manner that results the lowest possible rate. It
will be assumed that the redemption is made first of amounts representing shares
acquired pursuant to the reinvestment of dividends and distributions; then of
amounts representing the increase in net asset value of shares above the total
amount of payments for the purchase of shares made during the preceding year;
then of amounts representing shares purchased more than three years prior to the
redemption; and finally, of amounts representing the cost of shares purchased
within three years prior to the redemption.
<PAGE>
No redemption fees are payable by shareholders of Ameristock Large Company
Growth Fund.
Redemption by Mail
Each Fund will redeem all or any part of shares owned upon written request
delivered to the Fund at:
Ameristock Mutual Funds
Mutual Shareholder Services
1301 East Ninth Street, Suite 1005
Cleveland, Ohio 44114
The redemption request must:
1. Include your name and account number.
2. Specify the name of the Fund from which shares are to be
redeemed.
3. Specify the number of shares or dollar amount to be redeemed,
if less than all shares are to be redeemed.
4. Be signed by all owners exactly as their names appear on the
account.
5. Include a signature guarantee from any "eligible guarantor
institution" as defined by the rules under the Securities
Exchange Act of 1934 if (i) you change ownership of the
account, (ii) you want the redemption proceeds sent to a
different address from that registered on the account, (iii)
the proceeds are to be made payable to someone other than the
account owner(s), or (iv) the redemption request is for
$25,000 or more. Eligible guarantor institutions include
banks, broker/dealers, credit unions, national securities
exchanges, registered securities associations clearing
agencies, and savings associations. A notary public is
not an eligible guarantor.
In the case of shares being redeemed from an IRA or other qualified retirement
account, a statement of whether or not federal income tax should be withheld is
needed; otherwise federal tax will automatically be withheld.
In the case of shares registered in the name of a corporation or other legal
entity, the redemption request should be signed in the name of the corporation
or entity by an officer whose title is stated, and a certified bylaw provision
or resolution of the board of directors authorizing the officer to so act must
be furnished.
Redemption by Telephone
You may redeem shares by telephone by calling either Fund at (800) 394-5064. In
order to use the telephone redemption procedure, a shareholder must have elected
this procedure in writing, and the redemption proceeds must be mailed directly
to the investor or transmitted to the investor's predesignated account at a
domestic bank. To change the designated account or address, a written request
with signature(s) guaranteed must be sent to the Transfer Agent at least 15 days
before the telephone redemption request. Neither Fund nor the Transfer Agent
will be responsible for the authenticity of telephone instructions and will not
be responsible for any loss, damage, cost or expense arising out of any
telephone instructions received for an account. Furthermore, you agree to hold
harmless and indemnify the Fund, the Transfer Agent, and any affiliated
officers, employees, directors, and agents from any losses, expenses, costs or
liabilities (including attorneys' fees) that may be incurred in connection with
either the written or telephone redemption procedures.
<PAGE>
By electing the telephone redemption option, you may be giving up a measure of
security that you might have if you were to redeem your shares in writing. For
reasons involving the security of your account, you will be required to provide
a password to verify authenticity before your instructions will be carried out,
and the telephone transaction may be tape recorded.
NET ASSET VALUE
Net asset value per share is determined as of the close of regular trading on
the floor of the New York Stock Exchange (currently 4:00 p.m., New York time) on
each business day. The net asset value per share of a Fund is computed by
dividing the value of such Fund's net assets by the total number of shares of
such Fund outstanding.
The Fund's investments are valued primarily on the basis of market quotations.
INVESTMENT MANAGEMENT
Each Fund has retained as its investment adviser Ameristock Corporation (the
"Adviser"), an investment management organization founded in 1995. The Adviser
manages the investments of each Fund and is responsible for the overall
management of the business affairs of the Fund. The Adviser's address is P.O.
Box 6919, Moraga, California 94570.
As compensation for its services the Adviser receives an annual fee of 1% of
Ameristock Large Company Growth Fund's average net assets and 1.35% of
Ameristock Focused Value Fund's average net assets. The Adviser pays all of the
operating expenses of each Fund except for brokerage, taxes, interest and
extraordinary expenses.
The portfolio managers of Ameristock Large Company Growth Fund are Andrew Ngim
and Robert Nguyen. Mr. Ngim has been a Managing Director of Ameristock
Corporation since 1999 and was a benefits consultant with PriceWaterhouseCoopers
from 1994 to 1999. Previously, he was employed as a stockbroker and stock
analyst with a regional investment banking firm and as an investment consultant
with a third party pension administrator. Mr. Nguyen has been a Managing
Principal of Ameristock Corporation since 2000 and from 1995 to 1999 was an
institutional specialist at Charles Schwab and Co., Inc. Previously, Mr. Nguyen
was an equity portfolio manager with Bank of America and a stockbroker and stock
analyst with Morgan Stanley Dean Witter.
The portfolio managers of Ameristock Focused Value Fund are Nicholas D. Gerber
and Howard Mah. Mr. Gerber has been the Chairman and portfolio manager of
Ameristock Mutual Fund, Inc. since its incorporation in 1995 and previously was
an equity portfolio manager with Bank of America. Mr. Mah has been a tax and
financial consultant in private practice since 1995.
<PAGE>
DIVIDENDS AND TAXES
Each Fund declares and pays any dividends annually to shareholders. Dividends
are paid to all shareholders invested in such Fund as of the record date. The
record date is the date on which a shareholder must officially own shares in
order to earn a dividend.
In addition, each Fund pays any capital gains at least annually. Your dividends
and capital gains distributions will be automatically reinvested in additional
shares without a sales charge, unless you elect cash payments on the Application
to Buy Shares.
If you purchase shares just before a Fund declares a dividend or capital gain
distribution, you will pay the full price for the shares and then receive a
portion of the price back in the form of a distribution, whether or not you
reinvest the distribution in shares. Therefore, you should consider the tax
implications of purchasing shares shortly before the Fund declares a dividend or
capital gain. Contact your investment professional or the Fund for information
concerning when dividends and capital gains will be paid.
Each Fund sends an annual statement of your account activity to assist you in
completing your federal, state and local tax returns. Fund distributions of
dividends and capital gains are taxable to you whether paid in cash or
reinvested in the Fund. Dividends are taxable as ordinary income; capital gains
are taxable at different rates depending upon the length of time the Fund holds
its assets.
Fund distributions may be both dividends and capital gains. Generally,
distributions from each Fund are expected to be primarily capital gains
distributions. Redemptions are taxable sales. Please consult your tax adviser
regarding your federal, state and local tax liability.
OTHER INFORMATION
Firstar Bank, N.A., 425 Walnut Street, Cincinnati, Ohio 45201 has been
retained to act as the custodian of each Fund's investments.
Maxus Information Systems (dba Mutual Shareholder Services) 1301 East Ninth
Street, Suite 1005, Cleveland, Ohio 44114, is the transfer agent of each Fund.
McCurdy & Associates CPA's, Inc., 27955 Clemens Road, Westlake, Ohio 44145, has
been selected to serve as independent certified public accountants of each Fund.
McDonald, Hopkins, Burke & Haber Co., L.P.A., 2100 Bank One Center, 600 Superior
Avenue, East, Cleveland, OH 44114-2653, is legal counsel to each Fund and the
Adviser.
<PAGE>
AMERISTOCK LARGE COMPANY FUND
AMERISTOCK FOCUSED VALUE FUND
A Statement of Additional Information ("SAI") dated January 1, 2001 is
incorporated by reference into this prospectus. Additional information about
each Fund's investments is available in the Fund's annual and semi-annual
reports to shareholders. The annual report discusses market conditions and
investment strategies that significantly affected each Fund's performance during
its last fiscal year. To obtain the SAI, the annual report, semi-annual report
and other information without charge and to make shareholder inquires, call
either Fund at (800) 394-5064 or visit the Fund's Internet site at
http://www.ameristock.com.
Information about each Fund (including the SAI) can be reviewed and copied at
the Public Reference Room of the Securities and Exchange Commission in
Washington, D.C. Reports and other information about the Fund are available on
the Commission's Internet site at http://www.sec.gov and copies of this
information may be obtained, upon payment of a duplicating fee, by writing the
Public Reference Section of the Commission, Washington, D.C. 20549-6009. You can
call 1-800-SEC-0330 for information on the Public Reference Room's operations
and copying charges.
Ameristock Mutual Funds
P.O. Box 6919
Moraga, California 94570
Investment Adviser
Ameristock Corporation
P.O. Box 6919
Moraga, California 94570
Custodian
Firstar Bank, N.A.
Cincinnati, OH
Transfer Agent
Mutual Shareholder Services
Cleveland, Ohio
Legal Counsel
McDonald, Hopkins, Burke & Haber Co., L.P.A.
Cleveland, Ohio
Independent Auditor
McCurdy & Associates CPAs, Inc.
Westlake, Ohio
Investment Company Act File No. 811-
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<PAGE>
APPLICATION TO BUY SHARES
Please check one of the following boxes:
Ameristock Large Company Growth Fund
Ameristock Focused Value Fund
Mail to: Minimum Investments:
Ameristock Mutual Funds Initial: $1,000
1301 East Ninth Street Subsequent: $ 100
Suite 1005
Cleveland, OH 44114
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Owner Joint Owner
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Address Social Security or Tax Id Number
--------------------------- -----------------------------------
City State Zip Daytime Phone Number
If more than one owner is listed above, then shares will be registered as joint
tenants with right of survivorship and not as tenants in common, unless
otherwise instructed.
This investment represents an:
Initial investment payable to: Ameristock Large Company Growth
----- Fund or Ameristock Focused Value Fund: Amount $
--------
Investment wired to account: Amount $
----- --------
All income dividends and capital gains distributions will be reinvested in
additional shares as stated in the Prospectus unless the box below is checked.
Please pay all income dividends and capital gains
----- distributions in cash.
I am a U.S. Citizen [Yes] [No] (circle one)
The Internal Revenue Service (IRS) requires each taxpayer to provide a Social
Security or Taxpayer Identification Number and to make the following
certifications. I certify under penalty of perjury that:
1. The Social Security or Tax ID number stated above is correct.
2. I am not subject to backup withholding because:*
a) The IRS has not informed me that I am subject to
backup withholding.
b) The IRS has notified me that I am no longer subject
to backup withholding.
<PAGE>
* If this statement is not true and you are subject to backup withholding, cross
out Section 2. I/We, the undersigned, have received a copy of the current
Prospectus of the Ameristock Large Company Growth Fund/Ameristock Focused Value
Fund and are purchasing Fund shares in accordance with its provisions. I/We
further certify that the undersigned is of legal age and has full legal capacity
to make this purchase. The purchase price shall be the net asset value next
determined following receipt of the application by the applicable Fund, if the
application is accepted. This application cannot be processed unless accompanied
by payment.
---------------------------
Signature of Owner /Date
<PAGE>
AMERISTOCK LARGE COMPANY GROWTH FUND
AMERISTOCK FOCUSED VALUE FUND
STATEMENT OF ADDITIONAL INFORMATION
January 1, 2001
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectus of the Ameristock Large Company Growth Fund
and Ameristock Focused Value Fund (each "Fund" and collectively, the "Funds")
dated January 1, 2001. To obtain a copy of the Prospectus, without charge,
please write to the Funds at P.O. Box 6919, Moraga, CA 94570 or call (800)
394-5064.
TABLE OF CONTENTS
Investments and Risks 1
Management Agreement 6
Management of the Fund 7
Ownership of Shares 8
Portfolio Turnover 8
Portfolio Transactions and Brokerage 8
Share Redemptions 8
Taxation of the Fund 9
Performance Information 9
Additional Information 11
INVESTMENTS AND RISKS
Classification
Ameristock Large Company Growth Fund is a diversified, open-end management
investment company. Ameristock Focused Value Fund is a non-diversified, open-end
management investment company.
Information on Each Fund's Investments
Each Fund has an investment objective of seeking capital appreciation. The
principal investment strategies used by each Fund to pursue this objective,
together with the principal risks of investing in each Fund, are described in
the Prospectus under the headings "Risk/Return Summary - Ameristock Large
Company Growth Fund" and "Risk/Return Summary - Ameristock Focused Value Fund".
Described below are (i) certain other investment strategies (including
strategies to invest in particular types of securities) which are not principal
strategies and (ii) the risks of those strategies:
<PAGE>
Securities Lending. Securities lending allows each Fund to retain ownership of
the securities loaned out and, at the same time, to earn additional income. Each
Fund may lend its portfolio securities constituting up to 30% of its net assets.
Since there may be delays in the recovery of loaned securities, or even a loss
of rights in collateral supplied should the borrower fail financially, loans
will only be made to U.S. or foreign banks or broker-dealers which have been
rated within the two highest grades assigned by Standard & Poor's or Moody's, or
which have been determined by the Investment Adviser to be of equivalent
quality. Furthermore, securities will only be lent if, in the judgement of the
Investment Adviser, the consideration to be earned from such loans justify the
risk.
Cash received through loan transactions may be invested in any security in which
the Fund is authorized to invest. Investing this cash subjects that investment,
as well as the security loaned, to market forces (i.e., capital appreciation or
depreciation).
Risks of securities lending are (i) loss of rights in the loaned securities
should the borrower fail financially and (ii) investment losses on the loaned
securities.
Illiquid Investments. Illiquid investments are investments that cannot be sold
or disposed of in the ordinary course of business at approximately the prices at
which they are valued. Under the supervision of the Board of Trustees, the
Investment Adviser determines the liquidity of each Fund's investments and,
through reports from the Investment Adviser, the Board of Trustees monitors
investments in illiquid instruments. In determining the liquidity of the Fund's
investments, the Investment Adviser may consider various factors, including (i)
the frequency of trades and quotations, (ii) the number of dealers and
prospective purchasers in the marketplace, (iii) dealer undertakings to make a
market, (iv) the nature of the security (including any demand or tender
features), and (v) the nature of the marketplace for trades (including the
ability to assign or offset the Fund's rights and obligations relating to the
investment). The Fund may not invest in securities or other assets that the
Board of Trustees determines to be illiquid if more than 15% of the Fund's net
assets would be invested in such securities.
Foreign Exposure. Each Fund may invest in (i) stocks of U.S. headquartered
companies having substantial foreign operations or (ii) foreign stocks. These
stocks involve certain inherent risks that are different from those of other
companies, including political or economic instability of the foreign country or
countries, diplomatic developments which could affect U.S. investments in those
countries, changes in foreign currency and exchange rates and the possibility of
adverse changes in investment or exchange control regulations. As a result of
these and other factors, these stocks may be subject to greater price
fluctuations than securities of other companies.
<PAGE>
Options. An option on a security is a contract that permits the purchaser of the
option, in return for the premium paid, the right to buy a specified security or
index (in the case of a call option) or to sell a specified security or index
(in the case of a put option) from or to the writer of the option at a
designated price during the term of the option. An option on a securities index
permits the purchaser of the option, in return for the premium paid, the right
to receive from the seller cash equal to the difference between the closing
price of the index and the exercise price of the option. The gain or loss on an
option on an index depends on price movements in the instruments making up the
market, market segment, industry or other composite on which the underlying
index is based, rather than price movements in individual securities, as is the
case with respect to options on securities. Each Fund may write a call or put
option only if the option is "covered". This means so long as the Fund is
obligated as the writer of a call option, it will hold the underlying security
subject to the call, or hold a call at the same or lower exercise price, for the
same exercise period, and on the same securities as on the written call. A put
is covered if the Fund maintains liquid assets with a value equal to the
exercise price in a segregated account, or holds a put on the same underlying
securities at an equal or greater exercise price. Put options and call options
typically have similar structural characteristics and operational mechanics
regardless of the underlying instruments on which they are purchased or sold.
A Fund's purchase of a put option on a security might be designated to protect
its holdings in the underlying instrument (or, in some cases a similar
instrument) against substantial declines in the market value by giving the Fund
the right to sell such instrument at the option exercise price. A Fund's
purchase of a call option on a security or index might be intended to protect
the Fund against an increase in the price of the underlying instrument that it
intends to purchase in the future by fixing the price at which it may purchase
such instrument. If a Fund sells a call option, the premium that it receives may
serve as a partial hedge, to the extent of the option premium, against a
decrease in the value of the underlying securities or instruments in its
portfolio or will increase the Fund's income. The sale of put options can also
provide income.
The value of the underlying securities on which the options may be written at
any one time will not exceed 15% of either Fund's total assets. A Fund will not
purchase put or call options if the aggregate premium paid for such options
would exceed 5% of the Fund's total assets at the time of purchase.
Even though a Fund will receive the option premium to help protect it against a
loss, a call sold by the Fund exposes the Fund during the term of the option to
possible loss of opportunity to realize appreciation in the market price of the
underlying security or instrument and may require the Fund to hold a security or
instrument which it might otherwise have sold.
A Fund's ability to close out its position as a purchaser or seller of a put or
call option is dependent, in part, upon the liquidity of the option market.
Among the possible reasons for the absence of a liquid option market on an
exchange are: (i) insufficient trading interest in certain options; (ii)
restrictions on transactions imposed by an exchange; (iii) trading halts,
suspensions or other restrictions imposed with respect to particular classes or
series of options or underlying securities including reaching daily price
limits; (iv) interruption of the normal operations of an exchange; (v)
inadequacy of the facilities of an exchange to handle current trading volume; or
(vi) a decision by one or more exchanges to discontinue the trading of options
(or a particular class or series of options), in which event the relevant market
for that option on that exchange would cease to exist, although outstanding
options on that exchange would generally continue to be exercisable in
accordance with their terms.
The hours of trading for listed options may not coincide with the hours during
which the underlying financial instruments are traded. To the extent that the
option markets close before the markets for the underlying instruments,
significant price and rate movements can take place in the underlying markets
that cannot be reflected in the options markets.
Futures. Each Fund's use of options and financial futures thereon will in all
cases be consistent with applicable regulatory requirements and in particular
the rules and regulations of the Commodity Futures Trading Commission and will
be entered into only for bona fide hedging, risk management, or other portfolio
management purposes. Typically, maintaining a futures contract requires the Fund
to deposit with a financial intermediary as security for its obligations an
amount of cash or other specified asset (initial margin) which is typically 1%
to 10% of the face amount of the contract (but may be higher in some
circumstances). Additional cash or assets (variation or maintenance margin) may
be required to be deposited thereafter on a daily basis as the mark to market
value of the contract fluctuates. The purchase of an option on a futures
involves payment of a premium for the option without any further obligation on
the part of the Fund. If the Fund exercises an option on a futures contract it
will be obligated to post initial margin (and potential variation or maintenance
margin) for the resulting futures position just as it would for any position.
Futures contracts and options thereon are generally settled by entering into
offsetting transactions but there can be no assurance that the position can be
offset prior to settlement at an advantageous price, not that delivery will
occur.
<PAGE>
A Fund will not enter into a futures contract or related option (except for
closing transactions) if, immediately thereafter, the value of the face amount
of the open futures contracts and options thereon would exceed 25% of the Fund's
total assets.
There can be no assurance that a liquid market will exist at a time when a Fund
seeks to close out a futures or futures option position. The Fund would be
exposed to possible loss on the position during the interval of inability to
close, and would continue to be required to meet margin requirements until the
position was closed, which could result in a decrease in the Fund's net asset
value. The liquidity of a secondary market in a futures contract may be
adversely affected by "daily price fluctuation limits" established by commodity
exchanges which limit the amount of fluctuation in a futures contract price
during a single trading day. Once the daily limit has been reached in the
contract, no trades may be entered into at a price beyond the limit, thus
preventing the liquidation of open futures positions. The trading of futures
contracts is also subject to the risk of trading halts, suspensions, exchange or
clearing house equipment failures, government intervention, insolvency of a
brokerage firm or clearing house or other disruption or normal trading activity,
which could at times make it difficult or impossible to liquidate existing
positions or to recover excess variation margin payments.
Segregated Accounts. Futures contracts, options, and options on futures
contracts require a Fund to segregate liquid high grade assets with its
custodian to the extent Fund obligations are not otherwise "covered" through
ownership of the underlying security, or financial instrument. In general,
either the full amount of any obligation by the Fund to pay or deliver
securities or assets must be covered at all times by the securities, or
instruments required to be delivered, or, subject to any regulatory
restrictions, an amount of cash or liquid high grade securities at least equal
to the current amount of the obligation must be segregated with the custodian.
The segregated assets cannot be sold or transferred unless equivalent assets are
substituted in their place or it is no longer necessary to segregate them.
Fixed Income Securities. Each Fund may invest in fixed income securities
(corporate debt securities, bank certificates of deposit, bank checking account,
and U.S. Government and Agency obligations). All of Ameristock Large Company
Growth Fund's fixed income securities must be rated within the top three
categories of safety according to rating service companies like Standard &
Poor's, Moody's, Fitch, or Duff & Phelps at the time of the investment or, if
not rated, must then be determined by the Investment Adviser to be of comparable
quality. Fixed income securities prices fluctuate inversely with interest rate
movements. Other fixed income risk factors include default risk.
High-Yield Securities - Ameristock Focused Value Fund. Ameristock Focused Value
Fund may, from time to time, invest in lower-rated securities (rated BBB or
lower by Standard & Poor's Corporation Rating Service) or in unrated securities,
when, in the view of the Adviser, such investments are consistent with the
Fund's investment objective. Certain risk factors that investors should
recognize as being associated with the Adviser's discretion to invest in such
securities are set forth below.
In general, when interest rates decline, the value of fixed income securities
can be expected to rise. Conversely, when interest rates rise, the value of
fixed income securities can be expected to decline. Prices of lower-rated
securities (also sometimes referred to as "high-yield" securities) have been
found to be less sensitive to interest rate changes than higher-rated
investments, but more sensitive to adverse economic changes or individual
corporate developments. In addition, periods of economic uncertainty and changes
can be expected to result in increased volatility of market prices of
lower-rated securities.
<PAGE>
The values of lower-rated securities tend to reflect individual corporate
developments to a greater extent than higher-rated securities, which react
primarily to fluctuations in the general level of interest rates. Further,
securities rated BB or lower by Standard & Poor's are below investment grade and
are considered, on balance, to be predominantly speculative with respect to
capacity to pay interest and repay principal in accordance with the terms of the
obligation and will generally involve more credit risk than securities in the
higher rating categories. In some cases, such securities are subordinated to the
prior payment of senior indebtedness, thus potentially limiting the Fund's
ability to receive payments when senior securities are in default or to recover
full principal. Many issuers of lower-rated corporate debt securities are
substantially leveraged, which may impair their ability to meet debt service
obligations. Also, during an economic downturn or substantial period of rising
interest rates, highly leveraged issuers may experience financial stress which
would adversely affect their ability to service their principal and interest
payment obligations, to meet projected business goals, and to obtain additional
financing. Upon any default, the Fund may incur additional expenses to the
extent it is required to seek recovery of the payment of principal or interest
on the relevant portfolio holding.
In addition, lower-rated securities may tend to trade in markets that are
relatively less liquid than the market for higher rated securities. It is thus
possible that the Fund's ability to dispose of such securities, when its
investment adviser deems it desirable to do so, may be limited. The lack of a
liquid secondary market may also have an adverse impact on market price and the
Fund's ability to dispose of particular issues when necessary to met the Fund's
liquidity needs or in response to a specific economic event, such as a
deterioration in the creditworthiness of the issuer. In addition, a less liquid
market may interfere with the ability of the Fund to accurately value
lower-rated securities and, consequently, value the Fund's assets. Furthermore,
adverse publicity and investor perceptions, whether or not based on fundamental
analysis, may decrease the values and liquidity of lower-rated securities,
especially in a thinly-traded market.
The market for "high-yield" fixed-income securities has not weathered a major
economic recession and it is unknown what effect a recession might have on such
securities. It is likely, however, that any such recession could severely
disrupt the market for such securities and may have an adverse impact on the
value of such securities. In addition, it is likely that any such economic
downturn would adversely affect the ability of the issuers of such securities to
repay principal and pay interest thereon.
Standard & Poor's Corporation ("S&P") is a private service that provides rates
of the credit quality of debt obligations. These ratings represents S&P's
opinion as to the quality of the securities that they undertake to rate. It
should be emphasized, however, that ratings are general and are not absolute
standards of quality. Consequently, securities with the same maturity, interest
rate and rating may have different market prices. Subsequent to its purchase by
the Fund, an issue of securities may cease to be rated or its ratings may be
reduced.
Other Investment Companies. Each Fund may invest in securities issued by other
investment companies within the limits prescribed by the Investment Company Act
of 1940. Each Fund intends to limit its investments so that, as determined
immediately after a securities purchase is made: (i) not more than 5% of the
value of the Fund's total assets will be invested in the securities of any one
investment company; (ii) not more than 10% of the value of the Fund's total
assets will be invested in the aggregate in securities of investment companies
as a group; and (iii) not more than 3% of the outstanding voting stock of any
one investment company will be owned by the Fund. To the extent that a Fund
invests in other investment companies, an investor in the Fund will bear not
only his proportionate share of the expenses of the Fund but also indirectly
similar expenses of the underlying investment companies in which the Fund
invests. These expenses consist of advisory fees, expenses related to the
distribution of shares, brokerage commissions, accounting, pricing and custody
expenses, printing, legal and audit expenses and other miscellaneous expenses.
<PAGE>
Policies
Unless otherwise noted, whenever an investment policy states a maximum
percentage of either Fund's assets that may be invested in any security or other
asset, or sets forth a policy regarding quality standards, such a standard or
percentage will be determined immediately after and as a result of such Fund's
acquisition of such security or other asset. Accordingly, any subsequent change
in values, net assets, or other circumstances will not be considered when
determining whether the investment complies with such Fund's investment
objectives and policies.
Each Fund's fundamental investment policies cannot be changed without approval
by a "majority of the outstanding voting securities" (as defined in the
Investment Company Act of 1940) of the Fund. The following are the fund's
fundamental investment policies set forth in their entirety. The Fund may not:
1. purchase the securities of any issuer (other than securities
issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 25%
of the Fund's total assets would be invested in the securities
of companies whose principal business activities are in the
same industry;
2. purchase the securities of any issuer if such purchase, at the
time thereof, would cause the Fund to fail to satisfy the
requirements of the Internal Revenue Code Section 851(b)(3)
(or any successor provision), as amended;
3. issue senior securities, except as permitted under the
Investment Company Act of 1940, the rules and regulations
promulgated thereunder or interpretations of the Securities
and Exchange Commission or its staff;
4. borrow money, except that the Fund may borrow money for
temporary or emergency purposes (not for leveraging or
investment) provided that immediately after such borrowing,
the Fund has asset coverage (as defined in the Investment
Company Act of 1940) of at least 300%;
5. act as an underwriter of securities issued by others, except
to the extent the Fund may be deemed to be an underwriter in
connection with the disposition of portfolio securities;
6. invest in securities or other assets that the Board of
Trustees determines to be illiquid if more than 15% of the
Fund's net assets would be invested in such securities;
7. (a) purchase or sell physical commodities unless acquired as a
result of ownership of securities or other instruments (but
this shall not prevent the Fund from purchasing or selling
options and futures contracts or from investing in securities
or other instruments backed by physical commodities), (b)
invest in oil, gas, or mineral exploration or development
programs or leases, or (c) purchase securities on margin.
8. purchase or sell real estate or make real estate mortgage
loans or invest in real estate limited partnerships, except
that the Fund may purchase and sell securities issued by
entities engaged in the real estate industry or instruments
backed by real estate.
9. make loans, except the Fund may (i) purchase and hold debt
securities in accordance with its investment objective and
policies, and (ii) engage in securities lending as described
in the Prospectus and in the Statement of Additional
Information.
<PAGE>
The foregoing restrictions are fundamental policies that may not be changed
without the approval of a majority of the applicable Fund's outstanding voting
securities. A majority of a Fund's outstanding voting securities means the
lesser of (a) more than 50% of the Fund's outstanding voting securities or (b)
67% or more of the voting securities present at a meeting at which more than 50%
of the outstanding voting securities are present or represented by proxy.
MANAGEMENT AGREEMENT
Each Fund employs the Investment Adviser to furnish advisory and other services.
Under the Investment Adviser's contract with each Fund, the Investment Adviser
acts as Investment Adviser and, subject to the supervision of the Board of
Trustees, directs the investments of the Fund in accordance with the Fund's
investment objective, policies, and limitations. The Investment Adviser also
provides the Fund with all necessary office facilities and personnel for
servicing the Fund's investments, and compensates all officers of the Fund, all
Trustees who are "interested persons" of the Fund or the Investment Adviser, and
all personnel of the Fund or of the Investment Adviser performing services
relating to research, statistical, and investment activities.
In addition, the Investment Adviser, subject to the supervision of the Board of
Trustees, provides the management and administration services necessary for the
operation of the Fund. These services include providing facilities for
maintaining the Fund's organization; supervising relations with custodians,
transfer and pricing agents, accountants, underwriters, and other persons
dealing with the Fund; preparing all general shareholder communications and
conducting shareholder relations; maintaining the Fund's records and the
registration of the Fund's shares under federal and state law; developing
management and shareholder services for the Fund; and furnishing reports,
evaluations, and analysis on a variety of subjects to the Board of Trustees.
The Adviser pays all operating expenses of each Fund except for brokerage,
taxes, interest, and extraordinary expenses (including, without limitation,
litigation and indemnification costs and expenses).
For the services of the Investment Adviser, each Fund pays as compensation a
fee, accrued daily and payable monthly, at an annual rate of 1.00% of Ameristock
Large Company Growth Fund's average net assets and 1.35% of Ameristock Focused
Value Fund's average net assets.
MANAGEMENT OF THE FUND
The Trustees and Officers of the Fund, their business addresses and their
principal occupations during the past five years are set forth below. Those
Trustees who are "interested persons" (as defined in the Investment Company Act
of 1940) by virtue of their affiliation with the Investment Adviser are
indicated by an asterisk (*).
<PAGE>
<TABLE>
<CAPTION>
====================================================================================================================
Name and Business Address Age Position Held with Fund Principal Occupation for Last Five
Years
====================================================================================================================
<S> <C> <C> <C>
Nicholas D. Gerber* (38) Chairman and Trustee President Ameristock Corporation,
P.O. Box 6919 Portfolio Manager of the Fund.
Moraga, CA 94570 Portfolio Manager with Bank of America
helping to manage over $250 million
in commingled and mutual fund accounts
(1993-1995).
Stephen J. Marsh (47) Trustee Vice-President with FMV Opinions, Inc.
P.O. Box 6919 (1998-Present). Managing Director,
Moraga, CA 94570 The Mentor Group (1991-1998).
Alev Efendioglu, PhD. (58) Trustee Professor of Management and Small
P.O. Box 6919 Business Institute Director, McLaren
Moraga, CA 94570 School of Business, University of San
Francisco (1977-Present).
</TABLE>
The Trustees of the Fund who are employees or Trustees of the Investment Adviser
receive no compensation from the Fund. Each of the other Trustees is paid an
annual retainer of $1.00 and is reimbursed for the expenses of attending
meetings.
OWNERSHIP OF SHARES
The only person known by the Funds to be holders of record or beneficially of 5%
or more of the shares of either Fund as of , 2000 was Ameristock
---------------
Corporation, which owned 100% of the shares of each Fund.
As of , 2000, all Officers and Trustees as a group beneficially
--------------
owned 100% of the outstanding shares of each Fund.
PORTFOLIO TURNOVER
While it is difficult to predict, the Investment Adviser expects that the annual
portfolio turnover rate will not exceed 100% for Ameristock Large Company Growth
Fund and 200% for Ameristock Focused Value Fund. A greater rate may be
experienced during periods of marketplace volatility which necessitates more
active trading. A higher portfolio turnover rate involves greater transaction
costs to the Fund and may result in the realization of net capital gains which
would be taxable to shareholders when distributed.
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to the supervision of the Board of Trustees, decisions to buy and sell
securities for each Fund and negotiation of its brokerage commission rate are
made by the Investment Adviser. Transactions on United States stock exchanges
involve the payment by the Fund of negotiated brokerage commissions. There is
generally no stated commission in the case of securities traded in the
over-the-counter market but the price paid by the Fund usually includes an
undisclosed dealer commission or mark-up. In certain instances, the Fund may
make purchases of underwritten issues at prices which include underwriting fees.
In selecting a broker to execute each transaction, the Investment Adviser will
take the following into consideration: the best net price available; the
reliability, integrity and financial condition of the broker; the size and
difficulty in executing the order; and the value of the expected contribution of
the broker to the investment performance of the Fund on a continuing basis.
Accordingly, the cost of the brokerage commissions to the Fund in any
transaction may be greater than that available from other brokers if the
difference is reasonably justified, determined in good faith by the Investment
Adviser, by other aspects of the portfolio execution services offered such as
research, economic data, and statistical information about companies and
industries, non-inclusive.
<PAGE>
SHARE REDEMPTIONS
The right of redemption may be suspended, or the date of payment postponed
beyond the normal seven-day period by each Fund, under the following conditions
authorized by the 1940 Act: (1) for any period (a) during which the New York
Stock Exchange is closed, other than customary weekend and holiday closing, or
(b) during which trading on the New York Stock Exchange is restricted; for any
period during which an emergency exists as a result of (a) disposal by the Fund
of securities owned by it is not reasonably practicable, or (b) it is not
reasonably practicable for the Fund to determine the fair value of its net
assets; and (3) for such other periods as the SEC may by order permit for the
protection of the Fund's shareholders.
The value of shares of each Fund on redemption may be more or less than the
shareholder's cost, depending upon market value of the Fund's assets at the
time. Shareholders should note that if a loss has been realized on the sale of
shares of the Fund, the loss may be disallowed for tax purposes if shares of the
same Fund are purchased within (before or after) 30 days of the sale.
It is possible that conditions may exist in the future which would, in the
opinion of the Board of Trustees, make it undesirable for the Fund to pay for
redemption's in cash. In such cases the Board may authorize payment to be made
in portfolio securities of the Fund. Securities delivered in payment of
redemptions are valued at the same value assigned to them in computing the net
asset value per share. Shareholders receiving such securities generally will
incur brokerage costs on their sales.
TAXATION OF THE FUNDS
Each Fund intends to qualify each year as a "regulated investment company" under
the requirements of Subchapter M of the Internal Revenue Code of 1986, as
amended. Qualification as a regulated investment company will result in each
Fund's paying no taxes on net income and net realized capital gains distributed
to shareholders. If these requirements are not met, a Fund will not receive
special tax treatment and will pay federal income tax, thus reducing the total
return of the Fund.
Statements as to the tax status of each shareholder's dividends and
distributions will be mailed annually by the Fund's transfer agent. Shareholders
are urged to consult their own tax advisors regarding specific questions as to
Federal, state or local taxes.
PERFORMANCE INFORMATION
From time to time, quotations of each Fund's performance may be included in
advertisements, sales literature or reports to shareholders or prospective
investors. Each Fund may also compare its performance figures 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, the
Consumer Price Index, Standard & Poor's 500 Composite Price Index (the "S&P
500"), the various NASDAQ indices, and the Wilshire 5000. In addition, the Fund
may compare its performance to the performance of broad groups of mutual funds
with similar investment goals, as tracked by independent organizations such as
Investment Company Data, Inc., Lipper Analytical Services, Inc., CDA Investment
Technologies, Inc., Morningstar, Inc., Ibbotsen Associates, Value Line Mutual
Fund Survey, and other independent organizations. Also, each Fund may refer to
its ratings and related analysis supporting the ratings from these or other
independent organizations.
<PAGE>
From time to time, each Fund may compare its performance against inflation with
the performance of other instruments against inflation, such as short-term
Treasury Bills (which are direct obligations of the U.S. Government) and FDIC-
insured bank money market or certificate of deposit accounts. In addition,
advertising for the Fund may indicate that investors may consider diversifying
their investment portfolios in order to seek protection of the value of their
assets against inflation. From time to time advertising materials for the Fund
may refer to, or include commentary by the Fund's portfolio managers relating to
their respective investment strategies, asset growth, current or past business,
political, economic or financial conditions and other matters of general
interest to investors. In addition, from time to time, advertising materials for
the Funds may include information concerning retirement and investing for
retirement, including information provided by the Social Security
Administration, and may refer to the approximate number of then current Fund
shareholders.
Each Fund may compare its performance to various capital markets such as common
stocks, long-term government bonds, Treasury bills, and the U.S. rate of
inflation as these figures are provided by Ibbotsen Associates and other
independent organizations. Each Fund may also use the performance of these
capital markets in order to demonstrate general risk versus reward investment
scenarios. In addition, each Fund may quote financial or business publications
and periodicals, including model portfolios or allocations, as they relate to
fund management, investment philosophy, and investment techniques.
Each Fund may quote its performance in various ways. All performance information
supplied by the Fund in advertising is historical and is not intended to
indicate future returns. A Fund's share price and total returns fluctuate in
response to market conditions and other factors, and the value of Fund shares
may be more or less than their original cost.
Total returns quoted in advertising reflect all aspects of a Fund's return
including the effect of reinvesting dividends and capital gain distributions,
and any change in the Fund's net asset value per share (NAV) over the period.
Average annual returns are calculated by determining the growth or decline in
value of a hypothetical historical investment in the Fund over a stated period,
and then calculating the annually compounded percentage rate that would have
produced the same result if the rate of growth or decline in value had been
constant over the period. For example, a cumulative return of 100% over ten
years would produce an average annual total return of 7.18%, which is the steady
annual rate of return that would equal 100% growth on a compounded basis in ten
years. While average annual returns are a convenient means of comparing
investment alternatives, the Fund's performance is not consistent over time, but
changes from year to year, and that average annual returns represent figures as
opposed to the actual year-to-year performance of the Fund. The formula for
determining annual average total return expressed as a percentage is:
T = (ERV/P) 1/n - 1
Where:
T = average annual total return
P = a hypothetical initial investment of $1,000
n = number of years.
EVR = ending redeemable value: ERV is the value, at the
end of the applicable period, of a hypothetical $1,000
investment made at the beginning of the applicable period.
<PAGE>
In addition to average annual total returns, the Fund may quote unaveraged or
cumulative total returns reflecting the simple change in value of an investment
over a stated period. Average annual and cumulative returns may be quoted as a
percentage change or as a dollar amount, and may be calculated for a single
investment, a series of investments, or a series of redemptions, over any time
period. Total returns may be broken down into their component parts of income
and capital (including capital gains and changes in share price) in order to
illustrate the relationship of these factors and their contribution to total
return.
ADDITIONAL INFORMATION
Each Fund is an open-end management investment company and is a portfolio of
Davis Park Series Trust, a Delaware business trust organized on August 17, 2000
(the "Trust"). The Trust's Declaration of Trust authorizes the Board of Trustees
to issue an unlimited number of shares of each Fund. Each share of each Fund has
equal voting, dividend, distribution and liquidation rights. In the event that
Ameristock Corporation ceases to be the investment advisor, the right of each
Fund to use the identifying name "Ameristock" may be withdrawn.
Firstar Bank, N.A., Cincinnati, Ohio, is the custodian of the assets of each
Fund. The custodian is responsible for the safekeeping of each Fund's assets and
the appointment of sub-custodians and clearing agencies. The custodian takes no
part in determining the investment policies of either Fund or in deciding which
securities are purchased or sold by each Fund. Each Fund may, however, invest in
obligations of the custodian and may purchase securities from or sell securities
to the custodian. The Investment Adviser, its Officers and Directors, and the
Fund's Trustees may from time to time have transactions with various banks,
including banks servings as custodians for assets advised by the Investment
Adviser. There have been no transactions of this sort to date with the
Custodian.
The Financial Statements of the Fund included in this Statement of Additional
Information have been so included in reliance on the report of McCurdy &
Associates, Inc., independent certified public accountant, given on the
authority of that firm as experts in accounting and auditing.
[Financial Statements to come]
<PAGE>
PART C
OTHER INFORMATION
Item 23. Exhibits.
Exhibit Description
a Declaration of Trust.
b By-Laws.
c None.
d Management Agreement.
e None.
f None.
g Custody Agreement.
h(1) Transfer Agent Agreement.
h(2) Accounting Services Agreement.
i Opinion and consent.*
j Consent of Independent Auditors.*
k None.
l Subscription Agreement.*
m None.
n Financial Data Schedule.*
*To be filed by Amendment.
Item 24. Persons Controlled by or Under Common Control with Registrant.
The Fund and the Adviser may be deemed to be under common
control of Nicholas D. Gerber, the Chairman of the Fund and
President of the Adviser.
Item 25. Indemnification.
Reference is made to Article IV of the Registrant's Agreement
and Declaration of Trust filed as Exhibit a. The application
of these provisions is limited by the following undertaking
set forth in the rules promulgated by the Securities and
Exchange Commission:
<PAGE>
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in such Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the registrant of
expenses incurred or paid by a trustee, officer or controlling
person of the registrant in the successful defense of any
action, suite or proceeding) is asserted by such trustee,
officer or controlling person in connection with the
securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it
is against public policy as expressed in such Act and will be
governed by the final adjudication of such issue.
Item 26. Business and Other Connections of the Investment Adviser.
None.
Item 27. Principal Underwriters.
Not applicable.
Item 28. Location of Accounts and Records.
All accounts, books and documents required to be maintained by
the Registrant pursuant to Section 31(a) of the Investment
Company Act of 1940 and Rules 31a-1 through 31a-3 thereunder
are maintained at the office of the Registrant at 127 Devin
Road, Moraga, California 94556 and the Transfer Agent at The
Tower at Erieview, Suite 1005, 1301 East Ninth Street,
Cleveland, Ohio 44114, except that all records relating to the
activities of the Fund's Custodian are maintained at the
office of the Custodian, Firstar Bank N.A., 425 Walnut Street,
Cincinnati, Ohio 45201.
Item 29. Management Services.
Not applicable.
Item 30. Undertakings.
Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Moraga, State of California, on the 15th day of
September, 2000.
DAVIS PARK SERIES TRUST
By: Nicholas D. Gerber, Chairman
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 indicated.
Signature Title Date
Nicholas D. Gerber Chairman, President, September 15, 2000
Treasurer and Trustee
(Principal Executive Officer)
Alev Efendioglu, PhD Trustee September 15, 2000
Stephen J. Marsh Trustee September 15, 2000
<PAGE>
EXHIBIT A
DAVIS PARK SERIES TRUST
AGREEMENT AND DECLARATION OF TRUST
THIS AGREEMENT AND DECLARATION OF TRUST is made on August 17, 2000 by
Nicholas D. Gerber (together with all other persons from time to time duly
elected, qualified and serving as Trustees in accordance with the provisions of
Article II hereof, the "Trustees");
NOW, THEREFORE, the Trustees declare that all money and property
contributed to the Trust shall be held and managed in trust pursuant to this
Agreement and Declaration of Trust.
ARTICLE I
NAME AND DEFINITIONS
Section 1. Name. The name of the Trust created by this
Agreement and Declaration of Trust is "Davis Park Series Trust."
Section 2. Definitions. Unless otherwise provided or required
by the context:
(a) "Administrator" means the party, other than the Trust, to
the contract described in Article III, Section 3 hereof.
(b) "By-laws" means the By-laws of the Trust adopted by the
Trustees, as amended from time to time, which By-laws are expressly
herein incorporated by reference as part of the "governing instrument"
within the meaning of the Delaware Act.
(c) "Class" means the class of Shares of a Series
established pursuant to Article V.
(d) "Commission," "Interested Person" and "Principal
Underwriter" have the meanings provided in the 1940 Act. Except as such
term may be otherwise defined by the Trustees in conjunction with the
establishment of any Series of Shares, the term "vote of a majority of
the Shares outstanding and entitled to vote" shall have the same
meaning as is assigned to the term "vote of a majority of the
outstanding voting securities" in the 1940 Act.
(e) "Covered Person" means a person so defined in
Article IV, Section 2.
(f) "Custodian" means any Person other than the Trust who has
custody of any Trust Property as required by Section 17(f) of the 1940
Act, but does not include a system for the central handling of
securities described in said Section 17(f).
(g) "Declaration" shall mean this Agreement and Declaration of
Trust, as amended or restated from time to time. Reference in this
Declaration of Trust to "Declaration," "hereof," "herein," and
"hereunder" shall be deemed to refer to this Declaration rather than
exclusively to the article or section in which such words appear.
(h) "Delaware Act" means Chapter 38 of Title 12 of the
Delaware Code entitled "Treatment of Delaware Business Trusts," as
amended from time to time.
<PAGE>
(i) "Distributor" means the party, other than the Trust, to
the contract described in Article III, Section 1 hereof.
(j) "His" shall include the feminine and neuter, as well
as the masculine, genders.
(k) "Investment Adviser" means the party, other than the
Trust, to the contract described in Article III, Section 2 hereof.
(l) "Net Asset Value" means the net asset value of each Series
of the Trust, determined as provided in Article VI, Section 3.
(m) "Person" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures, estates and other
entities, and governments and agencies and political subdivisions,
thereof, whether domestic or foreign.
(n) "Series" means a series of Shares established pursuant to
Article V.
(o) "Shareholder" means a record owner of Outstanding Shares;
(p) "Shares" means the equal proportionate transferable units
of interest into which the beneficial interest of each Series or Class
is divided from time to time (including whole Shares and fractions of
Shares). "Outstanding Shares" means Shares shown in the books of the
Trust or its transfer agent as then issued and outstanding, but does
not include Shares which have been repurchased or redeemed by the Trust
and which are held in the treasury of the Trust.
(q) "Transfer Agent" means any Person other than the Trust who
maintains the Shareholder records of the Trust, such as the list of
Shareholders, the number of Shares credited to each account, and the
like.
(r) "Trust" means Davis Park Series Trust established hereby,
and reference to the Trust, when applicable to one or more Series,
refers to that Series.
(s) "Trustees" means the person who has signed this
Declaration of Trust, so long as he shall continue in office in
accordance with the terms hereof, and all other persons who may from
time to time be duly qualified and serving as Trustees in accordance
with Article II, in all cases in their capacities as Trustees
hereunder.
(t) "Trust Property" means any and all property, real or
personal, tangible or intangible, which is owned or held by or for the
Trust or any Series or the Trustees on behalf of the Trust or any
Series.
(u) The "1940 Act" means the Investment Company Act of 1940,
as amended from time to time.
<PAGE>
ARTICLE II
THE TRUSTEES
Section 1. Management of the Trust. The business and affairs of the
Trust shall be managed by or under the direction of the Trustees, and they shall
have all powers necessary or desirable to carry out that responsibility. The
Trustees may execute all instruments and take all action they deem necessary or
desirable to promote the interests of the Trust. Any determination made by the
Trustees in good faith as to what is in the interests of the Trust shall be
conclusive. In construing the provisions of this Declaration, the presumption
shall be in favor of a grant of power to the Trustees.
Section 2. Powers. The Trustees in all instances shall act as
principals, free of the control of the Shareholders. The Trustees shall have
full power and authority to take or refrain from taking any action and to
execute any contracts and instruments that they may consider necessary or
desirable in the management of the Trust. The Trustees shall not in any way be
bound or limited by current or future laws or customs applicable to trust
investments, but shall have full power and authority to make any investments
which they, in their sole discretion, deem proper to accomplish the purposes of
the Trust. The Trustees may exercise all of their powers without recourse to any
court or other authority. Subject to any applicable limitation herein or in the
By-laws or resolutions of the Trust, the Trustees shall have power and
authority, without limitation:
(a) To operate as and carry on the business of an investment
company, and exercise all the powers necessary and appropriate to the
conduct of such operations.
(b) To invest in, hold for investment, or reinvest in, cash;
securities, including common, preferred and preference stocks;
warrants; subscription rights; profit-sharing interests or
participations and all other contracts for or evidence of equity
interests; bonds, debentures, bills, time notes and all other evidences
of indebtedness; negotiable or non-negotiable instruments; government
securities, including securities of any state, municipality or other
political subdivision thereof, or any governmental or
quasi-governmental agency or instrumentality; and money market
instruments including bank certificates of deposit, finance paper,
commercial paper, bankers' acceptances and all kinds of repurchase
agreements, of any corporation, company, trust, association, firm or
other business organization however established, and of any country,
state, municipality or other political subdivision, or any governmental
or quasi-governmental agency or instrumentality; or any other security,
property or instrument in which the Trust or any of its Series shall be
authorized to invest.
(c) To acquire (by purchase, subscription or otherwise), to
hold, to trade in and deal in, to acquire any rights or options to
purchase or sell, to sell or otherwise dispose of, to lend and to
pledge any such securities, to enter into repurchase agreements,
reverse repurchase agreements, firm commitment agreements and forward
foreign currency exchange contracts, to purchase and sell options on
securities, securities indices, currency and other financial assets,
futures contracts and options on futures contracts of all descriptions
and to engage in all types of hedging and risk-management transactions.
(d) To exercise all rights, powers and privileges of ownership
or interest in all securities and repurchase agreements included in the
Trust Property, including the right to vote thereon and otherwise act
with respect thereto and to do all acts for the preservation,
protection, improvement and enhancement in value of all such securities
and repurchase agreements.
<PAGE>
(e) To acquire (by purchase, lease or otherwise) and to hold,
use, maintain, develop and dispose of (by sale or otherwise) any
property, real or personal, including cash or foreign currency, and any
interest therein.
(f) To borrow money or other property in the name of the Trust
exclusively for Trust purposes and in this connection issue notes or
other evidence of indebtedness; to secure borrowings by mortgaging,
pledging or otherwise subjecting as security the Trust Property; and to
endorse, guarantee, or undertake the performance of any obligation or
engagement of any other Person and to lend Trust Property.
(g) To aid by further investment any corporation, company,
trust, association or firm, any obligation of or interest in which is
included in the Trust Property or in the affairs of which the Trustees
have any direct or indirect interest; to do all acts and things
designed to protect, preserve, improve or enhance the value of such
obligation or interest; and to guarantee or become surety on any or all
of the contracts, stocks, bonds, notes, debentures and other
obligations of any such corporation, company, trust, association or
firm.
(h) To adopt By-laws not inconsistent with this Declaration
providing for the conduct of the business of the Trust and to amend and
repeal them to the extent such right is not reserved to the
Shareholders.
(i) To elect and remove such officers and appoint and
terminate such agents as they deem appropriate.
(j) To employ as custodian of any assets of the Trust, subject
to any provisions herein or in the By-laws, one or more banks, trust
companies or companies that are members of a national securities
exchange, or other entities permitted by the Commission to serve as
such.
(k) To retain one or more transfer agents and shareholder
servicing agents, or both.
(l) To provide for the distribution of Shares either through a
Principal Underwriter as provided herein or by the Trust itself, or
both, or pursuant to a distribution plan of any kind.
(m) To set record dates in the manner provided for herein
or in the By-laws.
(n) To delegate such authority as they consider desirable to
any officers of the Trust and to any agent, independent contractor,
manager, investment adviser, custodian or underwriter.
(o) To hold any security or other property (i) in a form not
indicating any trust, whether in bearer, book entry, unregistered or
other negotiable form, or (ii) either in the Trust's or Trustees' own
name or in the name of a custodian or a nominee or nominees, subject to
safeguards according to the usual practice of business trusts or
investment companies.
(p) To establish separate and distinct Series with separately
defined investment objectives and policies and distinct investment
purposes, and with separate Shares representing beneficial interests in
such Series, and to establish separate Classes, all in accordance with
the provisions of Article V.
<PAGE>
(q) To the full extent permitted by Section 3804 of the
Delaware Act, to allocate assets, liabilities and expenses of the Trust
to a particular Series and assets, liabilities and expenses to a
particular Class or to apportion the same between or among two or more
Series or Classes, provided that any liabilities or expenses incurred
by a particular Series or Class shall be payable solely out of the
assets belonging to that Series or Class as provided for in Article V,
Section 4.
(r) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or concern
whose securities are held by the Trust; to consent to any contract,
lease, mortgage, purchase, or sale of property by such corporation or
concern; and to pay calls or subscriptions with respect to any security
held in the Trust.
(s) To compromise, arbitrate, or otherwise adjust claims in
favor of or against the Trust or any matter in controversy including,
but not limited to, claims for taxes.
(t) To make distributions of income, capital gains, returns of
capital (if any) and redemption proceeds to Shareholders in the manner
hereinafter provided for.
(u) To establish committees for such purposes, with such
membership, and with such responsibilities as the Trustees may consider
proper, including a committee consisting of fewer than all of the
Trustees then in office, which may act for and bind the Trustees and
the Trust with respect to the institution, prosecution, dismissal,
settlement, review or investigation of any legal action, suit or
proceeding, pending or threatened.
(v) To issue, sell, repurchase, redeem, cancel, retire,
acquire, hold, resell, reissue, dispose of and otherwise deal in
Shares; to establish terms and conditions regarding the issuance, sale,
repurchase, redemption, cancellation, retirement, acquisition, holding,
resale, reissuance, disposition of or dealing in Shares; and, subject
to Articles V and VI, to apply to any such repurchase, redemption,
retirement, cancellation or acquisition of Shares any funds or property
of the Trust or of the particular Series with respect to which such
Shares are issued.
(w) To invest part or all of the Trust Property (or part or
all of the assets of any Series), or to dispose of part or all of the
Trust Property (or part or all of the assets of any Series) and invest
the proceeds of such disposition, in securities issued by one or more
other investment companies registered under the 1940 Act all without
any requirement of approval by Shareholders. Any such other investment
company may (but need not) be a trust (formed under the laws of the
State of Delaware or of any other state) which is classified as a
partnership for federal income tax purposes.
(x) To carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary
or desirable to accomplish any purpose or to further any of the
foregoing powers, and to take every other action incidental to the
foregoing business or purposes, objects or powers.
(y) To sell or exchange any or all of the assets of the Trust,
subject to Article IX, Section 4.
(z) To enter into joint ventures, partnerships and other
combinations and associations.
<PAGE>
(aa) To join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that
connection to deposit any security with, or transfer any security to,
any such committee, depositary or trustee, and to delegate to them such
power and authority with relation to any security (whether or not so
deposited or transferred) as the Trustees shall deem proper, and to
agree to pay, and to pay, such portion of the expenses and compensation
of such Committee, depositary or trustee as the Trustees shall deem
proper;
(bb) To purchase and pay for entirely out of Trust Property
such insurance as the Trustees may deem necessary or appropriate for
the conduct of the business, including, without limitation, insurance
policies insuring the assets of the Trust or payment of distributions
and principal on its portfolio investments, and, subject to applicable
law and any restrictions set forth in the By-laws, insurance policies
insuring the Shareholders, Trustees, officers, employees, agents,
investment advisers, Principal Underwriters, or independent contractors
of the Trust, individually, against all claims and liabilities of every
nature arising by reason of holding Shares, holding, being or having
held any such office or position, or by reason of any action alleged to
have been taken or omitted by any such Person as Trustee, officer,
employee, agent, investment adviser, Principal underwriter, or
independent contractor, including any action taken or omitted that may
be determined to constitute negligence, whether or not the Trust would
have the power to indemnify such Person against liability;
(cc) To adopt, establish and carry out pension,
profit-sharing, share bonus, share purchase, savings, thrift and other
retirement, incentive and benefit plans and trusts, including the
purchasing of life insurance and annuity contracts as a means of
providing such retirement and other benefits, for any or all of the
Trustees, officers, employees and agents of the Trust;
(dd) To enter into contracts of any kind and description;
(ee) To interpret the investment policies, practices or
limitations of any Series or Class; and
(ff) To guarantee indebtedness and contractual obligations
of others.
The clauses above shall be construed as objects and powers, and the
enumeration of specific powers shall not limit in any way the general powers of
the Trustees. Any action by one or more of the Trustees in their capacity as
such hereunder shall be deemed an action on behalf of the Trust or the
applicable Series, and not an action in an individual capacity. No one dealing
with the Trustees shall be under any obligation to make any inquiry concerning
the authority of the Trustees, or to see to the application of any payments made
or property transferred to the Trustees or upon their order. In construing this
Declaration, the presumption shall be in favor of a grant of power to the
Trustees.
Section 3. Certain Transactions. Except as prohibited by applicable
law, the Trustees may, on behalf of the Trust, buy any securities from or sell
any securities to, or lend any assets of the Trust to, any Trustee or officer of
the Trust or any firm of which any such Trustee or officer is a member acting as
principal, or have any such dealings with any investment adviser, administrator,
distributor or transfer agent for the Trust or with any Interested Person of
such person. The Trust may employ any such person or entity in which such person
is an Interested Person, as broker, legal counsel, registrar, investment
adviser, administrator, distributor, transfer agent, dividend disbursing agent,
custodian or in any other capacity upon customary terms.
<PAGE>
Section 4. Initial Trustees; Election and Number of Trustees. The
initial Trustee shall be the person initially signing this Declaration. The
number of Trustees (other than the initial Trustee) shall be fixed from time to
time by a majority of the Trustees; provided, that there shall be at least one
(1) Trustee and no more than fifteen (15). The Shareholders shall elect the
Trustees (other than the initial Trustee) on such dates as the Trustees may fix
from time to time.
Section 5. Term of Office of Trustees. Each Trustee shall hold office
for life or until his successor is elected or the Trust terminates; except that
(a) any Trustee may resign by delivering to the other Trustees or to any Trust
officer a written resignation effective upon such delivery or a later date
specified therein; (b) any Trustee may be removed with or without cause at any
time by a written instrument signed by at least a majority of the then Trustees,
specifying the effective date of removal; (c) any Trustee who requests to be
retired, or who is declared bankrupt or has become physically or mentally
incapacitated or is otherwise unable to serve, may be retired by a written
instrument signed by a majority of the other Trustees, specifying the effective
date of retirement; and (d) any Trustee may be removed at any meeting of the
Shareholders by a vote of at least two-thirds of the Outstanding Shares.
Section 6. Vacancies; Appointment of Trustees. Whenever a vacancy shall
exist in the Board of Trustees, regardless of the reason for such vacancy, the
remaining Trustees shall appoint any person as they determine in their sole
discretion to fill that vacancy, consistent with the limitations under the 1940
Act. Such appointment shall be made by a written instrument signed by a majority
of the Trustees or by a resolution of the Trustees, duly adopted and recorded in
the records of the Trust, specifying the effective date of the appointment. The
Trustees may appoint a new Trustee as provided above in anticipation of a
vacancy expected to occur because of the retirement, resignation or removal of a
Trustee, or an increase in number of Trustees, provided that such appointment
shall become effective only at or after the expected vacancy occurs. As soon as
any such Trustee has accepted his appointment in writing, the trust estate shall
vest in the new Trustee, together with the continuing Trustees, without any
further act or conveyance, and he shall be deemed a Trustee hereunder. The
Trustees' power of appointment is subject to Section 16(a) of the 1940 Act.
Whenever a vacancy in the number of Trustees shall occur, until such vacancy is
filled as provided in this Article II, 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 the Declaration. The
death, declination to serve, resignation, retirement, removal or incapacity of
one or more Trustees, or all of them, shall not operate to annul the Trust or to
revoke any existing agency created pursuant to the terms of this Declaration of
Trust.
Section 7. Temporary Vacancy or Absence. Whenever a vacancy in the
Board of Trustees shall occur, until such vacancy is filled, or while any
Trustee is absent from his domicile (unless that Trustee has made arrangements
to be informed about, and to participate in, the affairs of the Trust during
such absence), or is physically or mentally incapacitated, the remaining
Trustees shall have all the powers hereunder and their certificate as to such
vacancy, absence, or incapacity shall be conclusive. Any Trustee may, by power
of attorney, delegate his powers as Trustee for a period not exceeding six (6)
months at any one time to any other Trustee or Trustees.
Section 8. Chairman. The Trustees shall appoint one of their number to
be Chairman of the Board of Trustees. The Chairman shall preside at all meetings
of the Trustees, shall be responsible for the execution of policies established
by the Trustees and the administration of the Trust, and may be the chief
executive, financial and/or accounting officer of the Trust.
<PAGE>
Section 9. Action by the Trustees. The Trustees shall act by majority
vote at a meeting duly called at which a quorum is present, including a meeting
held by conference telephone, teleconference or other electronic media or
communication equipment by means of which all persons participating in the
meeting can communicate with each other; or by written consent of a majority of
Trustees (or such greater number as may be required by applicable law) without a
meeting. A majority of the Trustees shall constitute a quorum at any meeting.
Meetings of the Trustees may be called orally or in writing by the President or
by any one of the Trustees. Notice of the time, date and place of all Trustees'
meetings shall be given to each Trustee as set forth in the By-laws; provided,
however, that no notice is required if the Trustees provide for regular or
stated meetings. Notice need not be given to any Trustee who attends the meeting
without objecting to the lack of notice or who signs a waiver of notice either
before or after the meeting. The Trustees by majority vote may delegate to any
Trustee or Trustees or committee authority to approve particular matters or take
particular actions on behalf of the Trust. Any written consent or waiver may be
provided and delivered to the Trust by facsimile or other similar electronic
mechanism.
Section 10. Ownership of Trust Property. The Trust Property of the
Trust and of each Series shall be held separate and apart from any assets now or
hereafter held in any capacity other than as Trustee hereunder by the Trustees
or any successor Trustees. Legal title in and beneficial ownership of all of the
assets of the Trust shall at all times be considered as vested in the Trust,
except that the Trustees may cause legal title in and beneficial ownership of
any Trust Property to be held by, or in the name of one or more of the Trustees
acting for and on behalf of the Trust, or in the name of any person as nominee
acting for and on behalf of the Trust. No Shareholder shall be deemed to have a
severable ownership in any individual asset of the Trust or of any Series or any
right of partition or possession thereof, but each Shareholder shall have, as
provided in Article V, a proportionate undivided beneficial interest in the
Trust or Series or Class thereof represented by Shares. The Shares shall be
personal property giving only the rights specifically set forth in this Trust
Instrument. The Trust, or at the determination of the Trustees one or more of
the Trustees or a nominee acting for and on behalf of the Trust, shall be deemed
to hold legal title and beneficial ownership of any income earned on securities
of the Trust issued by any business entities formed, organized, or existing
under the laws of any jurisdiction, including the laws of any foreign country.
Upon the resignation or removal of a Trustee, or his otherwise ceasing to be a
Trustee, he 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 in the name of the resigning or removed
Trustee. Upon the incapacity or death of any Trustee, his legal representative
shall execute and deliver on his behalf such documents as the remaining Trustees
shall require as provided in the preceding sentence.
Section 11. Effect of Trustees Not Serving. The death, resignation,
retirement, removal, incapacity or inability or refusal to serve of the
Trustees, or any one of them, shall not operate to annul the Trust or to revoke
any existing agency created pursuant to the terms of this Declaration.
Section 12. Trustees, etc. as Shareholders. Subject to any restrictions
in the By-laws, any Trustee, officer, agent or independent contractor of the
Trust may acquire, own and dispose of Shares to the same extent as any other
Shareholder; the Trustees may issue and sell Shares to and buy Shares from any
such person or any firm or company in which such person is interested, subject
only to any general limitations herein.
Section 13. Series Trustees. In connection with the establishment of
one or more Series or Classes, the Trustees establishing such Series or Class
may appoint, to the extent permitted by the Delaware Act, separate Trustees with
respect to such Series or Classes (the "Series Trustees"). Series Trustees may,
but are not required to, serve as Trustees of the Trust or any other Series or
Class of the Trust. The Series Trustees shall have, to the exclusion of any
other Trustee of the Trust, all the powers and authorities of Trustees hereunder
with respect to such Series or Class, but shall have no power or authority with
respect to any other Series or Class. Any provision of this Declaration relating
to election of Trustees by Shareholders only shall entitle the Shareholders of a
Series or Class for which Series Trustees have been appointed to vote with
respect to the election of such Series Trustees and the Shareholders of any
other Series or Class shall not be entitled to participate in such vote. In the
event that Series Trustees are appointed, the Trustees initially appointing such
Series Trustees shall, without the approval of any Outstanding Shares, amend
either the Declaration or the By-laws to provide for the respective
responsibilities of the Trustees and the Series Trustees in circumstances where
an action of the Trustees or Series Trustees affects all Series of the Trust or
two or more Series represented by different Trustees.
<PAGE>
ARTICLE III
CONTRACTS WITH SERVICE PROVIDERS
Section 1. Underwriting Contract. The Trustees may in their discretion
from time to time enter into an exclusive or non-exclusive distribution contract
or contracts providing for the sale of the Shares whereby the Trustees may
either agree to sell the Shares to the other party to the contract or appoint
such other party as their sales agent for the Shares, and in either case on such
terms and conditions, if any, as may be prescribed in the By-laws, and such
further terms and conditions as the Trustees may in their discretion determine
not inconsistent with the provisions of this Article III or of the By-laws; and
such contract may also provide for the repurchase of the Shares by such other
party as agent of the Trustees.
Section 2. Advisory or Management Contract. The Trustees may in their
discretion from time to time enter into one or more investment advisory or
management contracts or, if the Trustees establish multiple Series, separate
investment advisory or management contracts with respect to one or more Series
whereby the other party or parties to any such contracts shall undertake to
furnish the Trust or such Series management, investment advisory,
administration, accounting, legal, statistical and research facilities and
services, promotional or marketing activities, and such other facilities and
services, if any, as the Trustees shall from time to time consider desirable and
all upon such terms and conditions as the Trustees may in their discretion
determine. Notwithstanding any provisions of the Declaration, the Trustees may
authorize the Investment Advisers or persons to whom the Investment Adviser
delegates certain or all of their duties, or any of them, under any such
contracts (subject to such general or specific instructions as the Trustees may
from time to time adopt) to effect purchases, sales, loans or exchanges of
portfolio securities and other investments of the Trust on behalf of the
Trustees or may authorize any officer, employee or Trustee to effect such
purchases, sales, loans or exchanges pursuant to recommendations of such
Investment Advisers, or any of them (and all without further action by the
Trustees). Any such purchases, sales, loans and exchanges shall be deemed to
have been authorized by all of the Trustees.
Section 3. Administration Agreement. The Trustees may in their
discretion from time to time enter into an administration agreement or, if the
Trustees establish multiple Series or Classes, separate administration
agreements with respect to each Series or Class, whereby the other party to such
agreement shall undertake to manage the business affairs of the Trust or of a
Series or Class thereof of the Trust and furnish the Trust or a Series or a
Class thereof with office facilities, and shall be responsible for the ordinary
clerical, bookkeeping and recordkeeping services at such office facilities, and
other facilities and services, if any, and all upon such terms and conditions as
the Trustees may in their discretion determine.
Section 4. Service Agreement. The Trustees may in their discretion from
time to time enter into service agreements with respect to one or more Series or
Classes of Shares whereby the other parties to such Service Agreements will
provide administration and/or support services pursuant to administration plans
and service plans, and all upon such terms and conditions as the Trustees in
their discretion may determine.
<PAGE>
Section 5. Transfer Agent. The Trustees may in their discretion from
time to time enter into a transfer agency and shareholder service contract
whereby the other party to such contract shall undertake to furnish transfer
agency and shareholder services to the Trust. The contract shall have such terms
and conditions as the Trustees may in their discretion determine not
inconsistent with the Declaration. Such services may be provided by one or more
Persons.
Section 6. Custodian. The Trustees may appoint or otherwise engage one
or more banks or trust companies, each having aggregate capital, surplus and
undivided profits (as shown in its last published report) of at least two
million dollars ($2,000,000), or any other entity satisfying the requirements of
the 1940 Act, to serve as Custodian with authority as its agent, but subject to
such restrictions, limitations and other requirements, if any, as may be
contained in the By-laws of the Trust. The Trustees may also authorize the
Custodian to employ one or more sub-custodians, including such foreign banks and
securities depositories as meet the requirements of applicable provisions of the
1940 Act, and upon such terms and conditions as may be agreed upon between the
Custodian and such sub-custodian, to hold securities and other assets of the
Trust and to perform the acts and services of the Custodian, subject to
applicable provisions of law and resolutions adopted by the Trustees.
Section 7. Affiliations of Trustees or Officers, Etc. The fact that:
(i)any of the Shareholders, Trustees or officers of
the Trust or any Series thereof is a shareholder, director,
officer, partner, trustee, employee, manager, adviser or
distributor of or for any partnership, corporation, trust,
association or other organization or of or for any parent or
affiliate of any organization, with which a contract of the
character described in this Article III or for services as
Custodian, Transfer Agent or disbursing agent or for related
services may have been or may hereafter be made, or that any
such organization, or any parent or affiliate thereof, is a
Shareholder of or has an interest in the Trust, or that
(ii) any partnership, corporation, trust, association
or other organization with which a contract of the character
described in Sections 1, 2, 3 or 4 of this Article III or for
services as Custodian, Transfer Agent or disbursing agent or
for related services may have been or may hereafter be made
also has any one or more of such contracts with one or more
other partnerships, corporations, trusts, associations or
other organizations, or has other business or interests, shall
not affect the validity of any such contract or disqualify any
Shareholder, Trustee or officer of the Trust from voting upon
or executing the same or create any liability or
accountability to the Trust or its Shareholders.
ARTICLE IV
COMPENSATION, LIMITATION OF
LIABILITY AND INDEMNIFICATION
Section 1. Compensation. The Trustees as such shall be entitled to
reasonable compensation from the Trust, and they may fix the amount of such
compensation. Nothing herein shall in any way prevent the employment of any
Trustee for advisory, management, legal, accounting, investment banking or other
services and payment for the same by the Trust.
<PAGE>
Section 2. Limitation of Liability. All persons contracting with or
having any claim against the Trust or a particular Series shall look only to the
assets of all Series or such particular Series for payment under such contract
or claim; and neither the Trustees nor, when acting in such capacity, any of the
Trust's officers, employees or agents, whether past, present or future, shall be
personally liable therefor. Every written instrument or obligation on behalf of
the Trust or any Series shall contain a statement to the foregoing effect, but
the absence of such statement shall not operate to make any Trustee or officer
of the Trust liable thereunder. Provided they have exercised reasonable care and
have acted under the reasonable belief that their actions are in the best
interest of the Trust, the Trustees and officers of the Trust shall not be
responsible or liable for any act or omission or for neglect or wrongdoing of
them or any officer, agent, employee, investment adviser or independent
contractor of the Trust, but nothing contained in this Declaration or in the
Delaware Act shall protect any Trustee or officer of the Trust against liability
to the Trust or to Shareholders to which he would otherwise be subject by reason
of willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office.
Section 3. Indemnification. (a) Subject to the exceptions and
limitations contained in subsection (b) below:
(i)every person who is, or has been, a Trustee or an
officer, employee or agent of the Trust (including any
individual who serves at its request as director, officer,
partner, trustee or the like of another organization in which
it has any interest as a shareholder, creditor or otherwise)
("Covered Person") shall be indemnified by the Trust or the
appropriate Series to the fullest extent permitted by law
against liability and against all expenses reasonably incurred
or paid by him in connection with any claim, action, suit or
proceeding in which he becomes involved as a party or
otherwise by virtue of his being or having been a Covered
Person and against amounts paid or incurred by him in the
settlement thereof; and
(ii) as used herein, the words "claim," "action,"
"suit," or "proceeding" shall apply to all claims, actions,
suits or proceedings (civil, criminal or other, including
appeals), actual or threatened, and the words "liability" and
"expenses" shall include, without limitation, attorneys' fees,
costs, judgments, amounts paid in settlement, fines, penalties
and other liabilities.
(b) No indemnification shall be provided hereunder to a
Covered Person:
(i)who shall have been adjudicated by a court or body
before which the proceeding was brought (A) to be liable to
the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of his office, or (B)
not to have acted in good faith in the reasonable belief that
his action was in the best interest of the Trust; or
(ii) in the event of a settlement, unless there has
been a determination that such Covered Person did not engage
in willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of
his office: (A) by the court or other body approving the
settlement; (B) by at least a majority of those Trustees who
are neither Interested Persons of the Trust nor are parties to
the matter based upon a review of readily available facts (as
opposed to a full trial-type inquiry); (C) by written opinion
of independent legal counsel based upon a review of readily
available facts (as opposed to a full trial-type inquiry) or
(D) by a vote of a majority of the Outstanding Shares entitled
to vote (excluding any Outstanding Shares owned of record or
beneficially by such individual).
<PAGE>
(c) The rights of indemnification herein provided may be
insured against by policies maintained by the Trust, shall be
severable, shall not be exclusive of or affect any other rights to
which any Covered Person may now or hereafter be entitled, and shall
inure to the benefit of the heirs, executors and administrators of a
Covered Person.
(d) To the maximum extent permitted by applicable law,
expenses in connection with the preparation and presentation of a
defense to any claim, action, suit or proceeding of the character
described in subsection (a) of this Section may be paid by the Trust or
applicable Series from time to time prior to final disposition thereof
upon receipt of an undertaking by or on behalf of such Covered Person
that such amount will be paid over by him to the Trust or applicable
Series if it is ultimately determined that he is not entitled to
indemnification under this Section; provided, however, that either (i)
such Covered Person shall have provided appropriate security for such
undertaking, (ii) the Trust is insured against losses arising out of
any such advance payments or (iii) either a majority of the Trustees
who are neither Interested Persons of the Trust nor parties to the
matter, or independent legal counsel in a written opinion, shall have
determined, based upon a review of readily available facts (as opposed
to a full trial-type inquiry) that there is reason to believe that such
Covered Person will not be disqualified from indemnification under this
Section.
(e) Any repeal or modification of this Article IV by the
Shareholders, or adoption or modification of any other provision of the
Declaration or By-laws inconsistent with this Article, shall be
prospective only, to the extent that such repeal, or modification
would, if applied retrospectively, adversely affect any limitation on
the liability of any Covered Person or indemnification available to any
Covered Person with respect to any act or omission which occurred prior
to such repeal, modification or adoption.
Section 3. Indemnification of Shareholders. If any Shareholder or
former Shareholder of any Series shall be held personally liable solely by
reason of his being or having been a Shareholder and not because of his acts or
omissions or for some other reason, the Shareholder or former Shareholder (or
his heirs, executors, administrators or other legal representatives or in the
case of any entity, its general successor) shall be entitled out of the assets
belonging to the applicable Series to be held harmless from and indemnified
against all loss and expense arising from such liability. The Trust, on behalf
of the affected Series, shall, upon request by such Shareholder, assume the
defense of any claim made against such Shareholder for any act or obligation of
the Series and satisfy any judgment thereon from the assets of the Series.
Section 4. No Bond Required of Trustees. No Trustee shall be
obligated to give any bond or other security for the performance of any of his
duties hereunder.
Section 5. No Duty of Investigation; Notice in Trust Instruments, Etc.
No purchaser, lender, transfer agent or other Person dealing with the Trustees
or any officer, employee or agent of the Trust or a Series thereof 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, Share, other security of the Trust or a
Series thereof or undertaking, and every other act or thing whatsoever executed
in connection with the Trust shall be conclusively presumed to have been
executed or done by the executors thereof only in their capacity as Trustees
under this Declaration or in their capacity as officers, employees or agents of
the Trust or a Series thereof. Every written obligation, contract, instrument,
certificate, Share, other security of the Trust or a Series thereof or
undertaking made or issued by the Trustees may recite that the same is executed
or made by them not individually, but as Trustees under the Declaration, and
that the obligations of the Trust or a Series thereof under any such instrument
are not binding upon any of the Trustees or Shareholders individually, but bind
only the Trust Property or the Trust Property of the applicable Series, and may
contain any further recital which they may deem appropriate, but the omission of
such recital shall not operate to bind the Trustees individually. The Trustees
shall at all times maintain insurance for the protection of the Trust Property
or the Trust Property of the applicable Series, its Shareholders, Trustees,
officers, employees and agents in such amount as the Trustees shall deem
adequate to cover possible tort liability, and such other insurance as the
Trustees in their sole judgment shall deem advisable.
<PAGE>
Section 6. Reliance on Experts, Etc. Each Trustee, officer or employee
of the Trust or a Series thereof shall, in the performance of his duties, powers
and discretions hereunder be fully and completely justified and protected with
regard to any act or any failure to act resulting from reliance in good faith
upon the books of account or other records of the Trust or a Series thereof,
upon an opinion of counsel, or upon reports made to the Trust or a Series
thereof by any of its officers or employees or by the Investment Adviser, the
Administrator, the Distributor, Transfer Agent, selected dealers, accountants,
appraisers 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.
ARTICLE V
SERIES; CLASSES; SHARES
Section 1. Establishment of Series or Class. The Trust shall consist of
one or more Series. Each Series shall be established and is effective upon the
adoption of a resolution of a majority of the Trustees or any alternative date
specified in such resolution. The Trustees may designate the relative rights and
preferences of the Shares of each Series. The Trustees may divide the Shares of
any Series into Classes. Without limiting the authority of the Trustees to
establish and designate any further Classes, the Trustees hereby establish a
single Class of Shares. Any Series and Classes that may from time to time be
established and designated by the Trustees 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; provided, that
all Shares shall be identical except for such variations as shall be fixed and
determined between different Series or Classes by the Trustees in establishing
and designating such Class or Series. The purchase price, the method of
determining the net asset value, and the relative dividend rights of holders
shall be as set forth in the Trust's Registration Statement on Form N-1A under
the Securities Act of 1933 and/or the 1940 Act and as in effect at the time of
issuing Shares.
All references to Shares in this Declaration shall be deemed to be
Shares of any or all Series or Classes as the context may require. The Trust
shall maintain separate and distinct records for each Series and hold and
account for the assets thereof separately from the other assets of the Trust or
of any other Series. A Series may issue any number of Shares or any Class
thereof and need not issue Shares. Each Share of a Series shall represent an
equal beneficial interest in the net assets of such Series. Each holder of
Shares of a Series or a Class thereof shall be entitled to receive his pro rata
share of all distributions made with respect to such Series or Class. Upon
redemption of his Shares, such Shareholder shall be paid solely out of the funds
and property of such Series. The Trustees may adopt and change the name of any
Series or Class.
<PAGE>
Section 2. Shares. The beneficial interest in the Trust shall be
divided into transferable Shares of one or more separate and distinct Series or
Classes established by the Trustees. The number of Shares of each Series and
Class is unlimited and each Share shall have no par value per Share or such
other amount as the Trustees may establish. All Shares issued hereunder shall be
fully paid and nonassessable. Shareholders shall have no preemptive or other
right to subscribe to any additional Shares or other securities issued by the
Trust. The Trustees shall have full power and authority, in their sole
discretion and without obtaining Shareholder approval, to issue original or
additional Shares at such times and on such terms and conditions as they deem
appropriate; to issue fractional Shares and Shares held in the treasury; to
establish and to change in any manner Shares of any Series or Classes with such
preferences, terms of conversion, voting powers, rights and privileges as the
Trustees may determine (but the Trustees may not change Outstanding Shares in a
manner materially adverse to the Shareholders of such Shares); to divide or
combine the Shares of any Series or Classes into a greater or lesser number; to
classify or reclassify any unissued Shares of any Series or Classes into one or
more Series or Classes of Shares; to abolish any one or more Series or Classes
of Shares; to issue Shares to acquire other assets (including assets subject to,
and in connection with, the assumption of liabilities) and businesses; and to
take such other action with respect to the Shares as the Trustees may deem
desirable. Shares held in the treasury shall not confer any voting rights on the
Trustees and shall not be entitled to any dividends or other distributions
declared with respect to the Shares.
Section 3. Investment in the Trust. The Trustees shall accept
investments in any Series or Class from such persons and on such terms as they
may from time to time authorize. At the Trustees' discretion, such investments,
subject to applicable law, may be in the form of cash or securities in which
that Series is authorized to invest, valued as provided in Article VI, Section
3. Investments in a Series shall be credited to each Shareholder's account in
the form of full Shares at the Net Asset Value per Share next determined after
the investment is received or accepted as may be determined by the Trustees;
provided, however, that the Trustees may, in their sole discretion, (a) impose a
sales charge upon investments in any Series or Class, (b) issue fractional
Shares, (c) determine the Net Asset Value per Share of the initial capital
contribution or (d) authorize the issuance of Shares at a price other than Net
Asset Value to the extent permitted by the 1940 Act or any rule, order or
interpretation of the Commission thereunder. The Trustees shall have the right
to refuse to accept investments in any Series at any time without any cause or
reason therefor whatsoever.
Section 4. Assets and Liabilities of Series. All consideration received
by the Trust for the issue or sale of Shares of a particular Series, together
with all assets 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 be held and accounted for separately from the assets of every other
Series and are referred to as "assets belonging to" that Series. The assets
belonging to a Series shall belong only to that Series for all purposes, and to
no other Series, subject only to the rights of creditors of that Series. Any
assets, income, earnings, profits, and proceeds thereof, funds, or payments
which are not readily identifiable as belonging to any particular Series shall
be allocated by the Trustees between and among one or more Series as the
Trustees deem fair and equitable. Each such allocation shall be conclusive and
binding upon the Shareholders of all Series for all purposes, and such assets,
earnings, income, profits or funds, or payments and proceeds thereof shall be
referred to as assets belonging to that Series. The assets belonging to a Series
shall be so recorded upon the books of the Trust, and shall be held by the
Trustees in trust for the benefit of the Shareholders of that Series. The assets
belonging to a Series shall be charged with the liabilities of that Series and
all expenses, costs, charges and reserves attributable to that Series, except
that liabilities and expenses allocated solely to a particular Class shall be
borne by that Class. Any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as belonging to any
particular Series or Class shall be allocated and charged by the Trustees
between or among any one or more of the Series or Classes in such manner as the
Trustees deem fair and equitable. Each such allocation shall be conclusive and
binding upon the Shareholders of all Series or Classes for all purposes.
<PAGE>
Without limiting the foregoing, but subject to the right of the
Trustees 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 contractual limitation on liabilities
among Series may, in the Trustees' 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 State of Delaware pursuant
to the Delaware Act, and upon the giving of such notice in the certificate of
trust, the statutory provisions of Section 3804 of the Delaware Act relating to
limitations on liabilities among Series (and the statutory effect under Section
3804 of setting forth such notice in the certificate of trust) shall become
applicable to the Trust and each Series. Any person extending credit to,
contracting with or having any claim against any Series may look only to the
assets of that Series to satisfy or enforce any debt, with respect to that
Series. No Shareholder or former Shareholder of any Series shall have a claim on
or any right to any assets allocated or belonging to any other Series.
Section 5. Ownership and Transfer of Shares. The Trust or a transfer or
similar agent for the Trust shall maintain a register containing the names and
addresses of the Shareholders of each Series and Class thereof, the number of
Shares of each Series and Class held by such Shareholders, and a record of all
Share transfers. The register shall be conclusive as to the identity of
Shareholders of record and the number of Shares held by them from time to time.
The Trustees may authorize the issuance of certificates representing Shares and
adopt rules governing their use. The Trustees may make rules governing the
transfer of Shares, whether or not represented by certificates. Except as
otherwise provided by the Trustees, Shares shall be transferable on the books of
the Trust only by the record holder thereof or by his duly authorized agent upon
delivery to the Trustees or the Trust's transfer agent of a duly executed
instrument of transfer, together with a Share certificate if one is outstanding,
and such evidence or the genuineness of each such execution and authorization
and of such other matters as may be required by the Trustees. Upon such
delivery, and subject to any further requirements specified by the Trustees or
contained in the By-laws, the transfer shall be recorded on the books of the
Trust. Until a transfer is so recorded, the Shareholder of record of Shares
shall be deemed to be the holder of such Shares for all purposes hereunder and
neither the Trustees nor the Trust, nor any transfer agent or registrar or any
officer, employee or agent of the Trust, shall be affected by any notice of a
proposed transfer.
Section 6. Status of Shares; Limitation of Shareholder Liability.
Shares shall be deemed to be personal property giving Shareholders only the
rights provided in this Declaration. Every Shareholder, by virtue of having
acquired a Share, shall be held expressly to have assented to and agreed to be
bound by the terms of this Declaration and to have become a party hereto. No
Shareholder shall be personally liable for the debts, liabilities, obligations
and expenses incurred by, contracted for, or otherwise existing with respect to,
the Trust or any Series. The death, incapacity, dissolution, termination or
bankruptcy of a Shareholder during the existence of the Trust shall not operate
to terminate the Trust, nor entitle the representative of any such Shareholder
to an accounting or to take any action in court or elsewhere against the Trust
or the Trustees, but entitles such representative only to the rights of such
Shareholder under this Trust. Ownership of Shares shall not entitle the
Shareholder to any title in or to the whole or any part of the Trust Property or
right to call for a partition or division of the same or for an accounting, nor
shall the ownership of Shares constitute the Shareholders as partners. Neither
the Trust nor the Trustees shall have any power to bind any Shareholder
personally or to demand payment from any Shareholder for anything, other than as
agreed by the Shareholder. Shareholders shall have the same limitation of
personal liability as is extended to shareholders of a private corporation for
profit incorporated in the State of Delaware. Every written obligation of the
Trust or any Series shall contain a statement to the effect that such obligation
may only be enforced against the assets of the appropriate Series or all Series;
however, the omission of such statement shall not operate to bind or create
personal liability for any Shareholder or Trustee.
<PAGE>
ARTICLE VI
DISTRIBUTIONS AND REDEMPTIONS
Section 1. Distributions. The Trustees or a committee of one or more
Trustees and one or more officers may declare and pay dividends and other
distributions, including dividends on Shares of a particular Series and other
distributions from the assets belonging to that Series. No dividend or
distribution, including, without limitation, any distribution paid upon
termination of the Trust or of any Series (or Class) with respect to, nor any
redemption or repurchase of, the Shares of any Series (or Class) shall be
effected by the Trust other than from the assets held with respect to such
Series, nor shall any Shareholder of any particular Series otherwise have any
right or claim against the assets held with respect to any other Series except
to the extent that such Shareholder has such a right or claim hereunder as a
Shareholder of such other Series. The Trustees shall have full discretion 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
Shareholders. The amount and payment of dividends or distributions and their
form, whether they are in cash, Shares or other Trust Property, shall be
determined by the Trustees. Dividends and other distributions may be paid
pursuant to a standing resolution adopted once or more often as the Trustees
determine. All dividends and other distributions on Shares of a particular
Series shall be distributed pro rata to the Shareholders of that Series in
proportion to the number of Shares of that Series they held on the record date
established for such payment, except that such dividends and distributions shall
appropriately reflect expenses allocated to a particular Class of such Series.
The Trustees may adopt and offer to Shareholders such dividend reinvestment
plans, cash dividend payout plans or similar plans as the Trustees deem
appropriate.
Section 2. Redemptions. Each Shareholder of a Series shall have the
right at such times as may be permitted by the Trustees to require the Series to
redeem all or any part of his Shares at a redemption price per Share equal to
the Net Asset Value per Share at such time as the Trustees shall have prescribed
by resolution, or, to the extent permitted by the 1940 Act, at such other
redemption price and at such times as the Trustees shall prescribe by
resolution. In the absence of such resolution, the redemption price per Share
shall be the Net Asset Value next determined after receipt by the Series of a
request for redemption in proper form less such charges as are determined by the
Trustees and described in the Trust's Registration Statement for that Series
under the Securities Act of 1933. The Trustees may specify conditions, prices,
and places of redemption, may specify binding requirements for the proper form
or forms of requests for redemption and may specify the amount of any deferred
sales charge to be withheld from redemption proceeds. Payment of the redemption
price may be wholly or partly in securities or other assets at the value of such
securities or assets used in such determination of Net Asset Value, or may be in
cash. Upon redemption, Shares may be reissued from time to time. The Trustees
may require Shareholders to redeem Shares for any reason under terms set by the
Trustees, including, but not limited to, the failure of a Shareholder to supply
a taxpayer identification number if required to do so, or to have the minimum
investment required, or to pay when due for the purchase of Shares issued to
him. To the extent permitted by law, the Trustees may retain the proceeds of any
redemption of Shares required by them for payment of amounts due and owing by a
Shareholder to the Trust or any Series or Class or any governmental authority.
Notwithstanding the foregoing, the Trustees may postpone payment of the
redemption price and may suspend the right of the Shareholders to require any
Series or Class to redeem Shares during any period of time when and to the
extent permissible under the 1940 Act.
<PAGE>
Section 3. Determination of Net Asset Value. The Trustees shall cause
the Net Asset Value of Shares of each Series or Class to be determined from time
to time in a manner consistent with applicable laws and regulations. The
Trustees may delegate the power and duty to determine Net Asset Value per Share
to one or more Trustees or officers of the Trust or to a custodian, depository
or other agent appointed for such purpose. The Net Asset Value of Shares shall
be determined separately for each Series or Class at such times as may be
prescribed by the Trustees or, in the absence of action by the Trustees, as of
the close of regular trading on the New York Stock Exchange on each day for all
or part of which such Exchange is open for unrestricted trading.
Section 4. Suspension of Right of Redemption. If, as referred to in
Section 2 of this Article, the Trustees postpone payment of the redemption price
and suspend the right of Shareholders to redeem their Shares, such suspension
shall take effect at the time the Trustees shall specify, but not later than the
close of business on the business day next following the declaration of
suspension. Thereafter Shareholders shall have no right of redemption or payment
until the Trustees declare the end of the suspension. If the right of redemption
is suspended, a Shareholder may either withdraw his request for redemption or
receive payment based on the Net Asset Value per Share next determined after the
suspension terminates.
Section 5. Repurchase by Agreement. The Trust may repurchase Shares
directly, or through the Distributor or another agent designated for the
purpose, by agreement with the owner thereof at a price not exceeding the Net
Asset Value per Share determined as of the time when the purchase or contract of
purchase is made or the Net Asset Value as of any time which may be later
determined, provided payment is not made for the Shares prior to the time as of
which such Net Asset Value is determined.
ARTICLE VII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 1. Voting Powers. The Shareholders shall have power to vote
only with respect to (a) the election of Trustees as provided in Section 2 of
this Article; (b) the removal of Trustees as provided in Article II, Section
3(d); (c) any investment advisory or management contract as provided in Article
VIII, Section 1; (d) any termination of the Trust as provided in Article IX,
Section 4; (e) the amendment of this Declaration to the extent and as provided
in Article X, Section 8; and (f) such additional matters relating to the Trust
as may be required or authorized by law, this Declaration, or the By-laws or any
registration of the Trust with the Commission or any State, or as the Trustees
may consider desirable.
On any matter submitted to a vote of the Shareholders, all Shares shall
be voted by individual Series or Class, except (a) when required by the 1940
Act, Shares shall be voted in the aggregate and not by individual Series or
Class, and (b) when the Trustees have determined that the matter affects the
interests of more than one Series or Class, then the Shareholders of all such
Series or Classes shall be entitled to vote thereon. As determined by the
Trustees without the vote or consent of shareholders, on any matter submitted to
a vote of Shareholders either (i) each whole Share shall be entitled to one vote
as to any matter on which it is entitled to vote and each fractional Share shall
be entitled to a proportionate fractional vote or (ii) each dollar of net asset
value (number of Shares owned times net asset value per share of such Series or
Class, as applicable) shall be entitled to one vote on any matter on which such
Shares are entitled to vote and each fractional dollar amount shall be entitled
to a proportionate fractional vote. Without limiting the power of the Trustees
in any way to designate otherwise in accordance with the preceding sentence, the
Trustees hereby establish that each whole Share shall be entitled to one vote as
to any matter on which it is entitled to vote and each fractional Share shall be
entitled to a proportionate fractional vote. There shall be no cumulative voting
in the election of Trustees. Shares may be voted in person or by proxy or in any
manner provided for in the By-laws. The By-laws may provide that proxies may be
given by any electronic or telecommunications device or in any other manner, but
if a proposal by anyone other than the officers or Trustees is submitted to a
vote of the Shareholders of any Series or Class, or if there is a proxy contest
or proxy solicitation or proposal in opposition to any proposal by the officers
or Trustees, Shares may be voted only in person or by written proxy. Until
Shares of a Series are issued, as to that Series the Trustees may exercise all
rights of Shareholders and may take any action required or permitted to be taken
by Shareholders by law, this Declaration or the By-laws. Meetings of
Shareholders shall be called and notice thereof and record dates therefor shall
be given and set as provided in the By-laws.
<PAGE>
Section 2. Quorum; Required Vote. One-third of the Outstanding Shares
of each Series or Class, or one-third of the Outstanding Shares of the Trust,
entitled to vote in person or by proxy shall be a quorum for the transaction of
business at a Shareholders' meeting with respect to such Series or Class, or
with respect to the entire Trust, respectively. Any lesser number shall be
sufficient for adjournments. Any adjourned session of a Shareholders' meeting
may be held within a reasonable time without further notice. Except when a
larger vote is required by law, this Declaration or the By-laws, a majority of
the Shares voting at a Shareholders' meeting in person or by proxy shall decide
any matters to be voted upon with respect to the entire Trust and a plurality of
such Shares shall elect a Trustee; provided, that if this Declaration or
applicable law permits or requires that Shares be voted on any matter by
individual Series or Classes, then a majority of the Shares of that Series or
Class (or, if required by law, a majority of the Shares outstanding and entitled
to vote of that Series or Class) voting at a Shareholders' meeting in person or
by proxy on the matter shall decide that matter insofar as that Series or Class
is concerned. Shareholders may act as to the Trust or any Series or Class by the
written consent of a majority (or such other amount as may be required by
applicable law) of the Outstanding Shares of the Trust or of such Series or
Class, as the case may be.
Section 3. Record Dates. For the purpose of determining the
Shareholders of any Series (or Class) who are entitled to receive payment of any
dividend or of any other distribution, the Trustees may from time to time fix a
date, which shall be before the date for the payment of such dividend or such
other payment, as the record date for determining the Shareholders of such
Series (or Class) having the right to receive such dividend or distribution.
Without fixing a record date, the Trustees may for distribution purposes close
the register or transfer books for one or more Series (or Classes) any time
prior to the payment of a distribution. Nothing in this Section shall be
construed as precluding the Trustees from setting different record dates for
different Series (or Classes).
Section 4. Additional Provisions. The By-laws may include further
provisions for Shareholders' votes and meetings and related matters.
<PAGE>
ARTICLE VIII
EXPENSES OF THE TRUST AND SERIES
Section 1. Payment of Expenses by the Trust. Subject to Article V,
Section 4, the Trust or a particular Series shall pay, or shall reimburse the
Trustees from the assets belonging to all Series or the particular Series, for
their expenses (or the expenses of a Class of such Series) and disbursements,
including, but not limited to, interest charges, taxes, brokerage fees and
commissions; expenses of issue, repurchase and redemption of Shares; certain
insurance premiums; applicable fees, interest charges and expenses of third
parties, including the Trust's investment advisers, managers, administrators,
distributors, custodians, transfer agents and fund accountants; fees of pricing,
interest, dividend, credit and other reporting services; costs of membership in
trade associations; telecommunications expenses; funds transmission expenses;
auditing, legal and compliance expenses; costs of forming the Trust and its
Series and maintaining its existence; costs of preparing and printing the
prospectuses of the Trust and each Series, statements of additional information
and Shareholder reports and delivering them to Shareholders; expenses of
meetings of Shareholders and proxy solicitations therefor; costs of maintaining
books and accounts; costs of reproduction, stationery and supplies; fees and
expenses of the Trustees; compensation of the Trust's officers and employees and
costs of other personnel performing services for the Trust or any Series; costs
of Trustee meetings; Commission registration fees and related expenses; state or
foreign securities laws registration fees and related expenses; and for such
non-recurring items as may arise, including litigation to which the Trust or a
Series (or a Trustee or officer of the Trust acting as such) is a party, and for
all losses and liabilities by them incurred in administering the Trust. The
Trustees shall have a lien on the assets belonging to the appropriate Series, or
in the case of an expense allocable to more than one Series, on the assets of
each such Series, prior to any rights or interests of the Shareholders thereto,
for the reimbursement to them of such expenses, disbursements, losses and
liabilities.
Section 2. Payment of Expenses by Shareholders. The Trustees shall have
the power, as frequently as they may determine, to cause each Shareholder, or
each Shareholder of any particular Series, to pay directly, in advance or
arrears, for charges of the Trust's custodian or transfer, shareholder servicing
or similar agent, an amount fixed from time to time by the Trustees, by setting
off such charges due from such Shareholder from declared but unpaid dividends
owed such Shareholder and/or by reducing the number of Shares in the account of
such Shareholder by that number of full and/or fractional Shares which
represents the outstanding amount of such charges due from such Shareholder.
ARTICLE IX
MISCELLANEOUS
Section 1. Trust Not a Partnership. This Declaration creates a trust
and not a partnership. No Trustee shall have any power to bind personally
either the Trust's officers or any Shareholder.
Section 2. Trustee Action. The exercise by the Trustees of their powers
and discretion hereunder in good faith and with reasonable care under the
circumstances then prevailing shall be binding upon everyone interested. Subject
to the provisions of Article IV, the Trustees shall not be liable for errors of
judgment or mistakes of fact or law.
Section 3. Record Dates. The Trustees may fix in advance a date up to
ninety (90) days before the date of any Shareholders' meeting, or the date for
the payment of any dividends or other distributions, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
Shares shall go into effect as a record date for the determination of the
Shareholders entitled to notice of, and to vote at, any such meeting, or
entitled to receive payment of such dividend or other distribution, or to
receive any such allotment of rights, or to exercise such rights in respect of
any such change, conversion or exchange of Shares.
<page
Section 4. Termination of the Trust.
(a) This Trust shall have perpetual existence. Subject to the
vote of a majority of the Shares outstanding and entitled to vote of
the Trust or of each Series to be affected, the Trustees may
(i)sell and convey all or substantially all of the
assets of all Series or any affected Series to another Series
or to another entity which is an open-end investment company
as defined in the 1940 Act, or is a series thereof, for
adequate consideration, which may include the assumption of
all outstanding obligations, taxes and other liabilities,
accrued or contingent, of the Trust or any affected Series,
and which may include shares of or interests in such Series,
entity, or series thereof; or
(ii) at any time sell and convert into money all or
substantially all of the assets of all Series or any affected
Series.
Upon making reasonable provision for the payment of all known
liabilities of all Series or any affected Series in either (i) or (ii),
by such assumption or otherwise, the Trustees shall distribute the
remaining proceeds or assets (as the case may be) ratably among the
Shareholders of all Series or any affected Series; however, the payment
to any particular Class of such Series may be reduced by any fees,
expenses or charges allocated to that Class.
(b) The Trustees may take any of the actions specified in
subsection (a)(i) and (ii) above without obtaining the vote of a
majority of the Shares Outstanding and entitled to vote of the Trust or
any Series if a majority of the Trustees determines that the
continuation of the Trust or Series is not in the best interests of the
Trust, such Series, or their respective Shareholders as a result of
factors or events adversely affecting the ability of the Trust or such
Series to conduct its business and operations in an economically viable
manner. Such factors and events may include the inability of the Trust
or a Series to maintain its assets at an appropriate size, changes in
laws or regulations governing the Trust or the Series or affecting
assets of the type in which the Trust or Series invests, or economic
developments or trends having a significant adverse impact on the
business or operations of the Trust or such Series.
(c) Upon completion of the distribution of the remaining
proceeds or assets pursuant to subsection (a), the Trust or affected
Series shall terminate and the Trustees and the Trust shall be
discharged of any and all further liabilities and duties hereunder with
respect thereto and the right, title and interest of all parties
therein shall be canceled and discharged. Upon termination of the
Trust, following completion of winding up of its business, the Trustees
shall cause a certificate of cancellation of the Trust's certificate of
trust to be filed in accordance with the Delaware Act, which
certificate of cancellation may be signed by any one Trustee.
<PAGE>
Section 5. Reorganization.
(a) Notwithstanding anything else herein, to change the
Trust's form or place of organization the Trustees may, without
Shareholder approval unless such approval is required by applicable
law, (i) cause the Trust to merge or consolidate with or into one or
more entities, if the surviving or resulting entity is the Trust or
another open-end management investment company under the 1940 Act, or a
series thereof, that will succeed to or assume the Trust's registration
under the 1940 Act, (ii) cause the Shares to be exchanged under or
pursuant to any state or federal statute to the extent permitted by
law, or (iii) cause the Trust to incorporate under the laws of Delaware
or any other U.S. jurisdiction. Any agreement of merger or
consolidation or certificate of merger may be signed by a majority of
Trustees and facsimile signatures conveyed by electronic or
telecommunication means shall be valid.
(b) Pursuant to and in accordance with the provisions of
Section 3815(f) of the Delaware Act, an agreement of merger or
consolidation approved by the Trustees in accordance with this Section
5 may effect any amendment to the Declaration or effect the adoption of
a new trust instrument of the Trust if it is the surviving or resulting
trust in the merger or consolidation.
(c) The Trustees may create one or more business trusts to
which all or any part of the assets, liabilities, profits or losses of
the Trust or any Series or Class thereof may be transferred and may
provide for the conversion of Shares in the Trust or any Series or
Class thereof into beneficial interests in any such newly created trust
or trusts or any series or classes thereof.
Section 6. Declaration of Trust. The original or a copy of this
Declaration of Trust and of each amendment hereto or Declaration of Trust
supplemental shall be kept at the office of the Trust where it may be inspected
by any Shareholder. Anyone dealing with the Trust may rely on a certificate by a
Trustee or an officer of the Trust as to the authenticity of the Declaration of
Trust or any such amendments or supplements and as to any matters in connection
with the Trust. The masculine gender herein shall include the feminine and
neuter genders. Headings herein are for convenience only and shall not affect
the construction of this Declaration of Trust. This Declaration of Trust may be
executed in any number of counterparts, each of which shall be deemed an
original.
Section 7. Applicable Law. This Declaration and the Trust created
hereunder are governed by and construed and administered according to the
Delaware Act and the applicable laws of the State of Delaware; provided,
however, that there shall not be applicable to the Trust, the Trustees or this
Declaration of Trust (a) the provisions of Section 3540 of Title 12 of the
Delaware Code, or (b) any provisions of the laws (statutory or common) of the
State of Delaware (other than the Delaware Act) pertaining to trusts which
relate to or regulate (i) the filing with any court or governmental body or
agency of trustee accounts or schedules of trustee fees and charges, (ii)
affirmative requirements to post bonds for trustees, officers, agents or
employees of a trust, (iii) the necessity for obtaining court or other
governmental approval concerning the acquisition, holding or disposition of real
or personal property, (iv) fees or other sums payable to trustees, officers,
agents or employees of a trust, (v) the allocation of receipts and expenditures
to income or principal, (vi) restrictions or limitations on the permissible
nature, amount or concentration of trust investments or requirements relating to
the titling, storage or other manner of holding of trust assets, or (vii) the
establishment of fiduciary or other standards of responsibilities or limitations
on the acts or powers of trustees, which are inconsistent with the limitations
or liabilities or authorities and powers of the Trustees set forth or referenced
in this Declaration. The Trust shall be of the type commonly called a Delaware
business trust, and, without limiting the provisions hereof, the Trust may
exercise all powers which are ordinarily exercised by such a trust under
Delaware law. The Trust specifically reserves the right to exercise any of the
powers or privileges afforded to trusts or actions that may be engaged in by
trusts under the Delaware Act, and the absence of a specific reference herein to
any such power, privilege or action shall not imply that the Trust may not
exercise such power or privilege or take such actions.
<PAGE>
Section 8. Amendments. The Trustees may, without any Shareholder vote,
amend or otherwise supplement this Declaration by making an amendment, a
Declaration of Trust supplemental hereto or an amended and restated trust
instrument; provided, that Shareholders shall have the right to vote on any
amendment (a) which would affect the voting rights of Shareholders granted in
Article VII, Section l, (b) to this Section 8, (c) required to be approved by
Shareholders by law or by the Trust's registration statement(s) filed with the
Commission, and (d) submitted to them by the Trustees in their discretion. Any
amendment submitted to Shareholders which the Trustees determine would affect
the Shareholders of any Series shall be authorized by vote of the Shareholders
of such Series and no vote shall be required of Shareholders of a Series not
affected. Notwithstanding anything else herein, any amendment to Article IV
which would have the effect of reducing the indemnification and other rights
provided thereby to Trustees, officers, employees, and agents of the Trust or to
Shareholders or former Shareholders, and any repeal or amendment of this
sentence shall each require the affirmative vote of the holders of two-thirds of
the Outstanding Shares of the Trust entitled to vote thereon.
Section 9. Derivative Actions. In addition to the requirements set
forth in Section 3816 of the Delaware Act, a Shareholder may bring a derivative
action on behalf of the Trust only if the following conditions are met:
(a) Shareholders eligible to bring such derivative action
under the Delaware Act who hold at least 10% of the Outstanding Shares
of the Trust, or 10% of the Outstanding Shares of the Series or Class
to which such action relates, shall join in the request for the
Trustees to commence such action; and
(b) the Trustees must be afforded a reasonable amount of time
to consider such shareholder request and to investigate the basis of
such claim. The Trustees shall be entitled to retain counsel or other
advisers in considering the merits of the request and shall require an
undertaking by the Shareholders making such request to reimburse the
Trust for the expense of any such advisers in the event that the
Trustees determine not to bring such action.
Section 10. Fiscal Year. The fiscal year of the Trust shall end on
a specified date as set forth in or pursuant to the By-laws. The Trustees may
change the fiscal year of the Trust without Shareholder approval.
Section 11. Severability. The provisions of this Declaration are
severable. If the Trustees determine, with the advice of counsel, that any
provision hereof conflicts with the 1940 Act, the regulated investment company
provisions of the Internal Revenue Code or with other applicable laws and
regulations, the conflicting provision 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. If any
provision hereof shall be held invalid or unenforceable in any jurisdiction,
such invalidity or unenforceability shall attach only to such provision only in
such jurisdiction and shall not affect any other provision of this Declaration.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of
the date first written above.
-----------------------------------
Nicholas D. Gerber, Trustee,
as Trustee and not individually
<PAGE>
EXHIBIT B
BY-LAWS
OF
DAVIS PARK SERIES TRUST
Dated August 17, 2000
ARTICLE I
DEFINITIONS
All capitalized terms have the respective meanings given them in the
Agreement and Declaration of Trust of Davis Park Series Trust, as amended or
restated from time to time.
ARTICLE II
OFFICES
Section 1. Principal Office. Until changed by the Trustees, the
principal office of the Trust shall be in Moraga, California.
Section 2. Other Offices. The Trust may have offices in such other
places without as well as within the State of Delaware as the Trustees may from
time to time determine.
Section 3. Registered Office and Registered Agent. The Board of
Trustees shall establish a registered office in the State of Delaware and shall
appoint as the Trust's registered agent for service of process in the State of
Delaware an individual resident of the State of Delaware or a Delaware
corporation or a corporation authorized to transact business in the State of
Delaware; in each case the business office of such registered agent for service
of process shall be identical with the registered Delaware office of the Trust.
ARTICLE III
SHAREHOLDERS
Section 1. Meetings. Meetings of the Shareholders of the Trust or a
Series or Class thereof shall be held as provided in the Declaration of Trust at
such place within or without the State of Delaware as the Trustees shall
designate. The holders of one-third of the Outstanding Shares of the Trust or a
Series or Class thereof present in person or by proxy and entitled to vote shall
constitute a quorum at any meeting of the Shareholders of the Trust or a Series
or Class thereof.
Section 2. Notice of Meetings. Notice of all meetings of the
Shareholders, stating the time, place and purposes of the meeting, shall be
given by the Trustees by mail or telegraphic or electronic means to each
Shareholder at his address as recorded on the register of the Trust mailed at
least ten (10) days and not more than ninety (90) days before the meeting,
provided, however, that notice of a meeting need not be given to a Shareholder
to whom such notice need not be given under the proxy rules of the Commission
under the 1940 Act and the Securities Exchange Act of 1934, as amended. Only the
business stated in the notice of the meeting shall be considered at such
meeting. Any adjourned meeting may be held as adjourned without further notice.
No notice need be given to any Shareholder who shall have failed to inform the
Trust of his current address or if a written waiver of notice, executed before
or after the meeting by the Shareholder or his attorney thereunto authorized, is
filed with the records of the meeting.
<PAGE>
Section 3. Record Date for Meetings and Other Purposes. For the purpose
of determining the Shareholders who are entitled to notice of and to vote at any
meeting, or to participate in any distribution, or for the purpose of any other
action, the Trustees may from time to time close the transfer books for such
period, not exceeding thirty (30) days, as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date not more than
ninety (90) days prior to the date of any meeting of Shareholders or
distribution or other action as a record date for the determination of the
persons to be treated as Shareholders of record for such purposes, except for
dividend payments which shall be governed by the Declaration of Trust.
Section 4. Proxies. At any meeting of Shareholders, any holder of
Shares entitled to vote thereat may vote by proxy, provided that no proxy shall
be voted at any meeting unless it shall have been placed on file with the
Secretary, or with such other officer or agent of the Trust as the Secretary may
direct, for verification prior to the time at which such vote shall be taken. A
proxy shall be deemed signed if the shareholder's name is placed on the proxy
(whether by manual signature, typewriting, telegraphic transmission, facsimile,
other electronic means or otherwise) by the Shareholder or the Shareholder's
attorney-in-fact. Proxies may be given by any electronic or telecommunication
device except as otherwise provided in the Declaration of Trust. Proxies may be
solicited in the name of one or more Trustees or one or more of the officers of
the Trust. Only Shareholders of record shall be entitled to vote. As determined
by the Trustees without the vote or consent of Shareholders, on any matter
submitted to a vote of Shareholders, either (i) each whole Share shall be
entitled to one vote as to any matter on which it is entitled to vote and each
fractional Share shall be entitled to a proportionate fractional vote or (ii)
each dollar of net asset value (number of Shares owned times net asset value per
Share of such Series or Class, as applicable) shall be entitled to one vote on
any matter on which such Shares are entitled to vote and each fractional dollar
amount shall be entitled to a proportionate fractional vote. Without limiting
their power to designate otherwise in accordance with the preceding sentence,
the Trustees have established in the Declaration of Trust that each whole share
shall be entitled to one vote as to any matter on which it is entitled by the
Declaration of Trust to vote and fractional shares shall be entitled to a
proportionate fractional vote. When any Share is held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Share, 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 Share. A proxy purporting to be executed by or on behalf of a
Shareholder shall be deemed valid unless challenged at or prior to its exercise,
and the burden of proving invalidity shall rest on the challenger. If the holder
of any such Share is a minor or a person of unsound mind, and subject to
guardianship or the legal control of any other person as regards the charge or
management of such Share, he may vote by his guardian or such other person
appointed or having such control, and such vote may be given in person or by
proxy.
Section 5. Abstentions and Broker Non-Votes. Outstanding Shares
represented in person or by proxy (including Shares which abstain or do not vote
with respect to one or more of any proposals presented for Shareholder approval)
will be counted for purposes of determining whether a quorum is present at a
meeting. Abstentions will be treated as Shares that are present and entitled to
vote for purposes of determining the number of Shares that are present and
entitled to vote with respect to any particular proposal, but will not be
counted as a vote in favor of such proposal. If a broker or nominee holding
Shares in "street name" indicates on the proxy that it does not have
discretionary authority to vote as to a particular proposal, those Shares will
not be considered as present and entitled to vote with respect to such proposal.
<PAGE>
Section 6. Inspection of Records. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
shareholders of a Delaware business corporation.
Section 7. Action without Meeting. Any action which may be taken by
Shareholders may be taken without a meeting if a majority of Outstanding Shares
entitled to vote on the matter (or such larger proportion thereof as shall be
required by law) consent to the action in writing and the written consents are
filed with the records of the meetings of Shareholders. Such consents shall be
treated for all purposes as a vote taken at a meeting of Shareholders.
ARTICLE IV
TRUSTEES
Section 1. Meetings of the Trustees. The Trustees may in their
discretion provide for regular or stated meetings of the Trustees. Notice of
regular or stated meetings need not be given. Meetings of the Trustees other
than regular or stated meetings shall be held whenever called by the President,
the Chairman or by any one of the Trustees, at the time being in office. Notice
of the time and place of each meeting other than regular or stated meetings
shall be given by the Secretary or an Assistant Secretary or by the officer or
Trustee calling the meeting and shall be mailed to each Trustee at least two
days before the meeting, or shall be given by telephone, cable, wireless,
facsimile or other electronic mechanism to each Trustee at his business address,
or personally delivered to him at least one day before the meeting. Such notice
may, however, be waived by any Trustee. Notice of a meeting need not be given to
any Trustee if a written waiver of notice, executed by him before or after the
meeting, is filed with the records of the meeting, or to any Trustee who attends
the meeting without protesting prior thereto or at its commencement the lack of
notice to him. A notice or waiver of notice need not specify the purpose of any
meeting. The Trustees may meet by means of a telephone conference circuit or
similar communications equipment by means of which all persons participating in
the meeting can hear each other at the same time and participation by such means
shall be deemed to have been held at a place designated by the Trustees at the
meeting. Participation in a telephone conference meeting shall constitute
presence in person at such meeting. Any action required or permitted to be taken
at any meeting of the Trustees may be taken by the Trustees without a meeting if
a majority of the Trustees consent to the action in writing and the written
consents are filed with the records of the Trustees' meetings. Such consents
shall be treated as a vote for all purposes.
Section 2. Quorum and Manner of Acting. A majority of the Trustees
shall be present in person at any regular or special meeting of the Trustees in
order to constitute a quorum for the transaction of business at such meeting and
(except as otherwise required by law, the Declaration of Trust or these By-laws)
the act of a majority of the Trustees present at any such meeting, at which a
quorum is present, shall be the act of the Trustees. In the absence of a quorum,
a majority of the Trustees present may adjourn the meeting from time to time
until a quorum shall be present. Notice of an adjourned meeting need not be
given.
<PAGE>
ARTICLE V
COMMITTEES
Section 1. Executive and Other Committees. The Trustees by vote of a
majority of all the Trustees may elect from their own number an Executive
Committee to consist of not less than three (3) members to hold office at the
pleasure of the Trustees, which shall have the power to conduct the current and
ordinary business of the Trust while the Trustees are not in session, including
the purchase and sale of securities and the designation of securities to be
delivered upon redemption of Shares of the Trust or a Series thereof, and such
other powers of the Trustees as the Trustees may delegate to them, from time to
time, except those powers which by law, the Declaration of Trust or these
By-laws they are prohibited from delegating. The Trustees may also elect from
their own number other Committees from time to time; the number composing such
Committees, the powers conferred upon the same (subject to the same limitations
as with respect to the Executive Committee) and the term of membership on such
Committees to be determined by the Trustees. The Trustees may designate a
chairman of any such Committee. In the absence of such designation the Committee
may elect its own Chairman.
Section 2. Meetings, Quorum and Manner of Acting. The Trustees may (1)
provide for stated meetings of any Committee, (2) specify the manner of calling
and notice required for special meetings of any Committee, (3) specify the
number of members of a Committee required to constitute a quorum and the number
of members of a Committee required to exercise specified powers delegated to
such Committee, (4) authorize the making of decisions to exercise specified
powers by written assent of the requisite number of members of a Committee
without a meeting, and (5) authorize the members of a Committee to meet by means
of a telephone conference circuit.
The Executive Committee shall keep regular minutes of its meetings and
records of decisions taken without a meeting and cause them to be recorded in a
book designated for that purpose and kept in the office of the Trust.
ARTICLE VI
OFFICERS
Section 1. General Provisions. The officers of the Trust shall be a
President, a Treasurer and a Secretary, who shall be elected by the Trustees.
The Trustees may elect or appoint such other officers or agents as the business
of the Trust may require, including one or more Vice Presidents, one or more
Assistant Secretaries, and one or more Assistant Treasurers. The Trustees may
delegate to any officer or committee the power to appoint any subordinate
officers or agents.
Section 2. Term of Office and Qualifications. Except as otherwise
provided by law, the Declaration of Trust or these By-laws, the President, the
Treasurer, the Secretary and any other officer shall each hold office at the
pleasure of the Board of Trustees or until his successor shall have been duly
elected and qualified. Any two or more offices may be held by the same person.
Any officer may be but none need be a Trustee or Shareholder.
Section 3. Removal. The Trustees, at any regular or special meeting of
the Trustees, may remove any officer with or without cause, by a vote of a
majority of the Trustees then in office. Any officer or agent appointed by an
officer or committee may be removed with or without cause by such appointing
officer or committee.
<PAGE>
Section 4. Powers and Duties of the Chairman. The Trustees may, but
need not, appoint from among their number a Chairman. When present he shall
preside at the meetings of the Shareholders and of the Trustees. He may call
meetings of the Trustees and of any committee thereof whenever he deems it
necessary. He shall be an executive officer of the Trust and shall have, with
the President, general supervision over the business and policies of the Trust,
subject to the limitations imposed upon the President, as provided in Section 5
of this Article VI.
Section 5. Powers and Duties of the President. The President may call
meetings of the Trustees and of any Committee thereof when he deems it necessary
and shall preside at all meetings of the Shareholders. Subject to the control of
the Trustees and to the control of any Committees of the Trustees, within their
respective spheres, as provided by the Trustees, he shall at all times exercise
a general supervision and direction over the affairs of the Trust. He shall have
the power to employ attorneys and counsel for the Trust or any Series or Class
thereof and to employ such subordinate officers, agents, clerks and employees as
he may find necessary to transact the business of the Trust or any Series or
Class thereof. He shall also have the power to grant, issue, execute or sign
such powers of attorney, proxies or other documents as may be deemed advisable
or necessary in furtherance of the interests of the Trust or any Series thereof.
The President shall have such other powers and duties, as from time to time may
be conferred upon or assigned to him by the Trustees.
Section 6. Powers and Duties of Vice Presidents. In the absence or
disability of the President, the Vice President or, if there be more than one
Vice President, any Vice President designated by the Trustees, shall perform all
the duties and may exercise any of the powers of the President, subject to the
control of the Trustees. Each Vice President shall perform such other duties as
may be assigned to him from time to time by the Trustees and the President.
Section 7. Powers and Duties of the Treasurer. The Treasurer shall be
the principal financial and accounting officer of the Trust. He shall deliver
all funds of the Trust or any Series or Class thereof which may come into his
hands to such Custodian as the Trustees may employ. He shall render a statement
of condition of the finances of the Trust or any Series or Class thereof to the
Trustees as often as they shall require the same and he shall in general perform
all the duties incident to the office of a Treasurer and such other duties as
from time to time may be assigned to him by the Trustees. The Treasurer shall
give a bond for the faithful discharge of his duties, if required so to do by
the Trustees, in such sum and with such surety or sureties as the Trustees shall
require.
Section 8. Powers and Duties of the Secretary. The Secretary shall keep
the minutes of all meetings of the Trustees and of the Shareholders in proper
books provided for that purpose; he shall have custody of the seal of the Trust;
he shall have charge of the Share transfer books, lists and records unless the
same are in the charge of a transfer agent. He shall attend to the giving and
serving of all notices by the Trust in accordance with the provisions of these
By-laws and as required by law; and subject to these By-laws, he shall in
general perform all duties incident to the office of Secretary and such other
duties as from time to time may be assigned to him by the Trustees.
Section 9. Powers and Duties of Assistant Officers. In the absence or
disability of the Treasurer, any officer designated by the Trustees shall
perform all the duties, and may exercise any of the powers, of the Treasurer.
Each officer shall perform such other duties as from time to time may be
assigned to him by the Trustees. Each officer performing the duties and
exercising the powers of the Treasurer, if any, and any Assistant Treasurer,
shall give a bond for the faithful discharge of his duties, if required so to do
by the Trustees, in such sum and with such surety or sureties as the Trustees
shall require.
<PAGE>
Section 10. Powers and Duties of Assistant Secretaries. In the absence
or disability of the Secretary, any Assistant Secretary designated by the
Trustees shall perform all the duties, and may exercise any of the powers, of
the Secretary. Each Assistant Secretary shall perform such other duties as from
time to time may be assigned to him by the Trustees.
Section 11. Compensation of Officers and Trustees and Members of the
Advisory Board. Subject to any applicable provisions of the Declaration of
Trust, the compensation of the officers and Trustees and members of an advisory
board shall be fixed from time to time by the Trustees or, in the case of
officers, by any Committee or officer upon whom such power may be conferred by
the Trustees. No officer shall be prevented from receiving such compensation as
such officer by reason of the fact that he is also a Trustee.
ARTICLE VII
FISCAL YEAR
The fiscal year of the Trust shall end on such day of each year as the
Trustees may from time to time determine. The taxable year of each Series of the
Trust shall be as determined by the Trustees from time to time.
ARTICLE VIII
SEAL
The Trustees may adopt a seal which shall be in such form and shall
have such inscription thereon as the Trustees may from time to time prescribe.
ARTICLE IX
SUFFICIENCY AND WAIVERS OF NOTICE
Whenever any notice whatever is required to be given by law, the
Declaration of Trust or these By-laws, a waiver thereof in writing, signed by
the person or persons entitled to said notice, whether before or after the time
stated therein, shall be deemed equivalent thereto. A notice shall be deemed to
have been sent by mail, telegraph, cable, wireless, facsimile or other
electronic means for the purposes of these By-laws when it has been delivered to
a representative of any company holding itself out as capable of sending notice
by such means with instructions that it be so sent.
ARTICLE X
AMENDMENTS
These By-laws, or any of them, may be altered, amended or repealed, or
new By-laws may be adopted by (a) vote of a majority of the Outstanding Shares
voting in person or by proxy at a meeting of Shareholders and entitled to vote
or (b) by the Trustees, provided, however, that no By-law may be amended,
adopted or repealed by the Trustees if such amendment, adoption or repeal
requires, pursuant to law, the Declaration of Trust or these By-laws, a vote of
the Shareholders.
<PAGE>
EXHIBIT C
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (the "Management Agreement") is made and
entered into this day of , 2000, by and between Davis Park
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Series Trust (the "Trust") and Ameristock Corporation (the "Investment
Advisor").
RECITALS:
The Trust and the Investment Advisor desire to enter into a Management
Agreement between them to read as set forth below.
NOW, THEREFORE, the Trust and the Investment Advisor agree as follows:
1. The Trust hereby employs the Investment Advisor to act as investment
adviser for its investment portfolios Ameristock Large Company Growth Fund,
Ameristock Focused Value Fund and such other investment portfolios as the Trust
may from time to time create (individually, a "Fund" or collectively, the
"Funds"). The Investment Advisor shall regularly provide each Fund with
continuing investment advice and management for such Fund's portfolio consistent
with the Fund's investment objective, policies and restrictions as provided for
in the Fund's Prospectus and Statement of Additional Information, determine what
securities shall be purchased, held and sold for the portfolio of the Fund, and
what portion of the Fund's assets shall be held uninvested, subject always to
the provisions of the Declaration of Trust of the Trust, the Investment Company
Act of 1940 (the "1940 Act"), the Internal Revenue Code of 1986 and to the
Fund's investment objective, policies and restrictions, and subject, further, to
such policies and instructions as the Board of Trustees of the Trust from time
to time may establish.
2. The Investment Advisor shall render administrative services (not
otherwise provided by third parties) necessary for each Fund's operations as an
open-end investment company ncluding, but not limited to, preparing reports and
notices to the Board of Trustees and shareholders; supervising, negotiating
contractual arrangements with, and monitoring various third-party service
providers to each Fund (such as the Fund's transfer agent, pricing agents,
custodian, accountants, and others); preparing and making filings with the SEC
and other regulatory agencies; assisting in the preparation and filing of the
Fund's federal, state and local tax returns; preparing and filing each Fund's
federal excise tax returns; assisting with investors and public relations
matters; monitoring the valuation of securities and the calculation of net asset
value, monitoring the registration of shares of each Fund under applicable
federal and state securities laws; maintaining each Fund's books and records to
the extent not otherwise maintained by a third party; assisting in establishing
accounting policies of each Fund; assisting in resolution of accounting and
legal issues; establishing and monitoring each Fund's operating budget;
processing the payment of each Fund's bills; assisting each Fund in, and
otherwise arranging for, the payment of distributions and dividends and
otherwise assisting each Fund in the conduct of its business, subject to the
direction and control of the Board of Trustees.
The Investment Advisor shall furnish at its own expense office space to
each Fund and all necessary office facilities, equipment and personnel for
managing the assets of the Fund. The Investment Advisor also shall pay for
expenses of marketing shares of each Fund, all expenses in determination of
daily price computations, placement of securities orders (excluding brokerage
commissions) and related bookkeeping.
<PAGE>
The Investment Advisor shall pay all other operating expenses of each
Fund with the exception of brokerage, taxes, interest and extraordinary expenses
(including, without limitation, litigation and indemnification costs and
expenses), which shall be paid by each Fund.
3. The Investment Advisor shall receive, as compensation for its
services, a fee, accrued daily and payable monthly, at an annual rate of 1.00%
of Ameristock Large Company Growth Fund's net assets and 1.35% of Ameristock
Focused Value Fund's net assets. On days for which the values of a Fund's net
assets are not determined, the fee shall be accrued on the most recently
determined net assets adjusted for subsequent daily income and expense accruals.
4. The Management Agreement shall continue for a period of two years
from the date of the agreement and the Board of Trustees shall approve at least
annually or the shareholders shall vote a majority of the outstanding voting
securities of the Fund annually to continue this Management Agreement, provided
that in either event the continuance is also approved by a majority of the Board
of Trustees who are not "interested persons" (as defined in the 1940 Act) of the
Trust or the Investment Advisor by vote cast in person at a meeting called for
the purpose of voting such approval.
5. The Management Agreement is terminable without penalty, on 60 days'
notice, by the Fund's Board of Trustees or by vote of a majority of the holders
of the Fund's shares, or, on not less than 90 days' notice, by the Investment
Advisor. This Management Agreement will terminate automatically in the event of
its assignment (as defined in the 1940 Act).
6. A Fund may use the name Ameristock only so long as this Management
Agreement or any extension, renewal or amendment thereof remains in effect as to
such Fund and with the permission of the Investment Advisor.
7. The Investment Advisor shall not be liable for any errors of
judgment or mistakes of law or for any loss suffered by the Fund in connection
with matters to which this Management Agreement relates, except for a loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
the Investment Advisor in the performance of its obligations and duties under
this Management Agreement.
DAVIS PARK SERIES TRUST
By:
Nicholas D. Gerber, Chairman
AMERISTOCK CORPORATION
By:
Nicholas D. Gerber, President
<PAGE>
EXHIBIT G
CUSTODY AGREEMENT
This AGREEMENT, dated as of , 2000, by and between
--------------------
Davis Park Series Trust (the "Trust"), a business trust organized under the laws
of the State of Delaware, acting with respect to each series or portfolio of the
Trust as listed on Exhibit D hereto (as such Exhibit may be amended from time to
time) (collectively the "Funds" and individually a "Fund"), and Firstar Bank
N.A., a national banking association (the "Custodian").
WITNESSETH:
WHEREAS, the Trust desires that each Fund's Securities and cash be held
and administered by the Custodian pursuant to this Agreement; and
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Custodian represents that it is a bank having the
qualifications prescribed in Section 26(a)(1) of the 1940 Act;
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Trust and the Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
1.1 "Authorized Person" means any Officer or other person duly
authorized by resolution of the Board of Trustees to give Oral Instructions and
Written Instructions on behalf of the Funds and named in Exhibit A hereto or in
such resolutions of the Board of Trustees, certified by an Officer, as may be
received by the Custodian from time to time.
<PAGE>
1.2 "Board of Trustees" shall mean the Trustees from time to time
serving under the Trust's Declaration of Trust, as from time to time amended.
1.3 "Book-Entry System" shall mean a federal book-entry system as
provided in Subpart O of Treasury Circular No. 300, 31 CFR 306, in Subpart B of
31 CFR Part 350, or in such book-entry regulations of federal agencies as are
substantially in the form of Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day by
The New York Stock Exchange, Inc. and any other day for which the Trust computes
the net asset value of Shares of one or more of the Funds.
1.5 "Foreign Depository" shall mean and include any "Eligible
Securities Depository", as that term is defined in Rule 17f-7 under the 1940
Act.
1.6 "Fund Custody Account" shall mean any of the accounts in the name
of the Trust, which is provided for in Section 3.2 below.
1.7 "NASD" shall mean The National Association of Securities Dealers,
Inc.
1.8 "Officer" shall mean the Chairman, President, any Vice President,
any Assistant Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer of the Trust.
1.9 "Oral Instructions" shall mean instruction orally transmitted to
and accepted by the Custodian because such instructions are (i) reasonably
believed by the Custodian to have been given by an Authorized Person and (ii)
orally confirmed by the Custodian. The Trust shall cause all Oral Instructions
to be confirmed by Written Instructions prior to the end of the next Business
Day. If such Written Instructions confirming Oral Instructions are not received
by the Custodian prior to a transaction, it shall in no way affect the validity
of the transaction or the authorization thereof by the Trust. If Oral
Instructions vary from the Written Instructions which purport to confirm them,
the Custodian shall notify the Trust of such variance but such Oral Instructions
will govern unless the Custodian has not yet acted.
<PAGE>
1.10 "Proper Instructions" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written Instructions when
deemed appropriate by both parties.
1.11 "Securities Depository" shall mean The Depository Trust Company
and (provided that Custodian shall have received a copy of a resolution of the
Board of Trustees, certified by an Officer, specifically approving the use of
such clearing agency as a depository for the Fund) any other clearing agency
registered with the Securities and Exchange Commission under Section 17A of the
Securities and Exchange Act of 1934, as amended (the "1934 Act"), which acts as
a system for the central handling of Securities where all Securities of any
particular class or series of an issuer deposited within the system are treated
as fungible and may be transferred or pledged by bookkeeping entry without
physical delivery of the Securities.
1.12 "Securities" shall include, without limitation, common and
preferred stocks, bonds, call options, put options, debentures, notes, bank
certificates of deposit, bankers' acceptances, mortgage-backed securities or
other obligations or securities, and any certificates, receipts, warrants or
other instruments or documents representing rights to receive, purchase or
subscribe for the same, or evidencing or representing any other rights or
interests therein, or any similar property or assets that the Custodian has the
facilities to clear and to service.
<PAGE>
1.13 "Shares" shall mean, with respect to a Fund, the units of
beneficial interest issued by the Trust on account of the Fund.
1.14 "Sub-Custodian" shall mean and include (i) any branch of a "U.S.
Bank," as that term is defined in Rule 17f-5 under the 1940 Act, (ii) any
"Eligible Foreign Custodian," as that term is defined in Rule 17f-5 under the
1940 Act, having a contract with the Custodian which the Custodian has
determined will provide reasonable care of assets of the Funds based on the
standards specified in Section 3.3 below. Such contract shall include provisions
that provide: (I) for indemnification or insurance arrangements (or any
combination of the foregoing) such that the Funds will be adequately protected
against the risk of loss of assets held in accordance with such contract; (ii)
that the Funds' assets will not be subject to any right, charge, security
interest, lien or claim of any kind in favor of the Sub-Custodian or its
creditors except a claim of payment for their safe custody or administration, in
the case of cash deposits, liens or rights in favor of creditors of the
Sub-Custodian arising under bankruptcy, insolvency, or similar laws: (iii) that
beneficial ownership for the Funds' assets will be freely transferable without
the payment of money or value other than for safe custody or administration;
(iv) that adequate records will be maintained identifying the assets as
belonging to the Funds or as being held by a third party for the benefit of the
Funds; (v) that the Funds' independent public accountants will be given access
to those records or confirmation of the contents of those records; and (vi) that
the Funds will receive periodic reports with respect to the safekeeping of the
Funds' assets, including, but not limited to, notification of any transfer to or
from a Fund's account or a third party account containing assets held for the
benefit of the Fund. Such contract my contain, in lieu of any or all of the
provisions specified above, such other provisions that the Custodian determines
will provide, in their entirety, the same or a greater level of care and
protection for Fund assets as the specified provisions, in their entirety.
<PAGE>
1.15 "Written Instructions" shall mean (i) written communications
actually received by the Custodian and signed by an Authorized Person, (ii)
communications by telex or any other such system from one or more persons
reasonably believed by the Custodian to be Authorized Persons, or (iii)
communications between electro-mechanical or electronic devices provided that
the use of such devices and the procedures for the use thereof shall have been
approved by resolutions of the Board of Trustees, a copy of which, certified by
and Officer, shall have been delivered to the Custodian.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Trust hereby constitutes and appoints the
Custodian as custodian of all Securities and cash owned by or in the possession
of the Funds at any time during the period of this Agreement.
2.2 Acceptance. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as hereinafter set forth.
2.3 Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the execution of
this Agreement to the Custodian by the Trust:
<PAGE>
A copy of the Declaration of Trust of the Trust certified by
the Trust's Secretary;
A copy of the Bylaws of the Trust certified by the Trust's Secretary;
A copy of the resolution of the Board of Trustees of the Trust
appointing the Custodian,certified by the Trust's Secretary;
A copy of the then current Prospectus of the Funds; and
A certification of the Chairman and Secretary of the Trust setting
forth the names and signatures of the current Officers of the Trust and other
Authorized Persons.
<PAGE>
2.4 Notice of Appointment of Dividend and Transfer Agent. The Trust
agrees to notify the Custodian in writing of the appointment, termination or
change in appointment of any Dividend and Transfer Agent for the Fund.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the
Custodian for the account of a Fund (other than Securities maintained in a
Securities Depository or Book-Entry System) shall be physically segregated from
other Securities and non-cash property in the possession of the Custodian
(including the Securities and non-cash property of the other Funds) and shall be
identified as subject to this Agreement.
3.2 Fund Custody Accounts. As to each Fund, the Custodian shall open
and maintain in its trust department a custody account in the name of the Trust
coupled with the name of the Fund, subject only to draft or order of the
Custodian in which the Custodian shall enter and carry all Securities, cash and
other assets of such Fund which are delivered to it.
3.3 Appointment of Agents. (a) In its discretion and subject to
subsection (b) below, the Custodian may appoint one or more Sub-Custodians to
hold Securities and cash of the Funds and to carry out such other provisions of
this Agreement as it may determine, provided, however, that the appointment of
any such agents and maintenance of any Securities and cash of the Fund shall be
at the Custodian's expense and shall not relieve the Custodian of any of its
obligations or liabilities under this Agreement.
(b) If, after the initial appointment of Sub-Custodians by the
Custodian in connection with this Agreement, the Custodian wishes to appoint
other Sub-Custodians to hold property of the Funds, it will promptly notify the
Trust and provide it with information it considered in connection with its
determination of any such new Sub-Custodian's eligibility under Rule 17f-5 under
the 1940 Act.
<PAGE>
(c) Each agreement between the Custodian and each Sub-Custodian acting
hereunder shall contain the required provisions set forth in Rule 17f-5(c)(2)
(d) Upon request the Custodian shall provide written reports notifying
the Board of Trustees of the placement of the Securities and cash of the Funds
with a particular Sub-Custodian and of any material changes in the Funds'
arrangements. The Custodian shall promptly take such steps as may be required to
withdraw assets, as soon as reasonably practicable, of the Funds from any
Sub-Custodian that has ceased to meet the requirements of Rule 17f-5 under the
1940 Act.
(e) Prior to appointing a Sub-Custodian with respect to a Fund, the
Custodian shall have established a system to monitor the appropriateness of
maintaining the Fund's assets with a particular Sub-Custodian and the contract
governing the Fund's arrangements with such Sub-Custodian.
(f) Prior to maintaining assets of a Fund with a Foreign Depository,
the Custodian shall provide the Trust with an analysis of the custodial risks of
using such Foreign Depository, which analysis shall include, at a minimum, the
following: (i) the Foreign Depository's expertise and market reputation; (ii)
the quality of its services, (iii) its financial strength; (iv) any insurance or
indemnification arrangements; (v) the extent and quality of regulation and
independent examination of the Foreign Depository; (vi) its standing in
published ratings; (vii) its internal controls and other procedures for
safeguarding investments; and (viii) any related legal proceedings. The
Custodian will monitor each Foreign Depository on a continuing basis and shall
notify the Trust of any material changes in risks associated with using the
Foreign Depository.
<PAGE>
(g) With respect to its responsibilities under this Section 3.3, the
Custodian hereby warrants to the Trust that it agrees to exercise reasonable
care, prudence and diligence such as a person having responsibility for the
safekeeping of property of the Funds would exercise. The Custodian further
warrants that a Fund's assets will be subject to reasonable care, based on the
standards applicable to custodians in the relevant market, if maintained with
each Sub-Custodian, after considering all factors relevant to the safekeeping of
such assets, including, without limitation: (i) the Sub-Custodian's practices,
procedures, and internal controls, including but not limited to the physical
protection available for certificated securities (if applicable), the method of
keeping custodial records, and the security and data protection practices; (ii)
whether the Sub-Custodian has the requisite financial strength to provide
reasonable care for Fund assets; (iii) the Sub-Custodian's general reputation
and standing and, in the case of a Securities Depository, the Securities
Depository's operating history and number of participants; and (iv) whether the
Fund will have jurisdiction over and be able to enforce judgments against the
Sub-Custodian, such as by virtue of the existence of any offices of the
Sub-Custodian in the United States or the Sub-Custodian's consent to service of
process in the United States.
3.4 Delivery of Assets to Custodian. The Trust shall deliver, or cause
to be delivered, to the Custodian all of the Funds' Securities, cash and other
assets, including (a) all payments of income, payments of principal and capital
distributions received by the Funds with respect to such Securities, cash or
other assets owned by the Funds at any time during the period of this Agreement,
and (b) all cash received by the Funds for the issuance, at any time during such
period, of Shares. The Custodian shall not be responsible for such Securities,
cash or other assets until actually received by it.
<PAGE>
3.5 Securities Depositories and Book-Entry Systems. The Custodian may
deposit and/or maintain Securities of the Funds in a Securities Depository or in
a Book-Entry System, subject to the following provisions:
(a) Prior to a deposit of Securities of the Funds in any Securities
Depository or Book-Entry System, the Trust shall deliver to the Custodian a
resolution of the Board of Trustees, certified by an Officer, authorizing and
instructing the Custodian on an on-going basis to deposit in such Securities
Depository or Book-Entry System all Securities eligible for deposit therein and
to make use of such Securities Depository or Book-Entry System to the extent
possible and practical in connection with its performance hereunder, including,
without limitation, in connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of collateral
consisting of Securities.
<PAGE>
(b) Securities of the Funds kept in a Book-Entry System or Securities
Depository shall be kept in an account ("Depository Account") of the Custodian
in such Book-Entry System or Securities Depository which includes only assets
held by the Custodian as a fiduciary, custodian or otherwise for customers.
(c) The records of the Custodian with respect to Securities of a Fund
maintained in a Book-Entry System or Securities Depository shall, by book-entry,
identify such Securities as belonging to such Fund.
(d) If Securities purchased by a Fund are to be held in a Book-Entry
System or Securities Depository, the Custodian shall pay for such Securities
upon (i) receipt of advice from the Book-Entry System or Securities Depository
that such Securities have been transferred to the Depository Account, and (ii)
the making of an entry on the records of the Custodian to reflect such payment
and transfer for the account of such Fund. If Securities sold by a Fund are held
in a Book-Entry System or Securities Depository, the Custodian shall transfer
such Securities upon (i) receipt of advice from the Book-Entry System or
Securities Depository that payment for such Securities has been transferred to
the Depository Account, and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account of such Fund
(e) The Custodian shall provide the Trust with copies of any report
(obtained by the Custodian from a Book-Entry System or Securities Depository in
which Securities of the Fund are kept) on the internal accounting controls and
procedures for safeguarding Securities deposited in such Book-Entry System or
Securities Depository.
(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Trust for any loss or damage to the Fund
resulting (i) from the use of a Book-Entry System or Securities Depository by
reason of any negligence or willful misconduct on the part of Custodian or any
Sub-Custodian appointed pursuant to Section 3.3 above or any of its or their
employees, or (ii) from failure of Custodian or any such Sub-Custodian to
enforce effectively such rights as it may have against a Book-Entry System or
Securities Depository. At its election, the Trust shall be subrogated to the
rights of the Custodian with respect to any claim against a Book-Entry System or
Securities Depository or any other person from any loss or damage to the Fund
arising from the use of such Book-Entry System or Securities Depository, if and
to the extent that the Funds has not been made whole for any such loss or
damage.
<PAGE>
3.6 Disbursement of Moneys from Fund Custody Account. Upon receipt of
Proper Instructions, the Custodian shall disburse moneys from the Fund Custody
Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only in accordance
with Section 4.1 of this Agreement and only (i) in the case of Securities (other
than options on Securities, futures contracts and options on futures contracts),
against the delivery to the Custodian (or any Sub-Custodian appointed pursuant
to Section 3.3 above) of such Securities registered as provided in Section 3.9
below or in proper form for transfer, or if the purchase of such Securities is
effected through a Book-Entry System or Securities Depository, in accordance
with the conditions set forth in Section 3.5 above; (ii) in the case of options
on Securities, against delivery to the Custodian (or such Sub-Custodian) of such
receipts as are required by the customs prevailing among dealers in such
options; (iii) in the case of futures contracts and options on futures
contracts, against delivery to the Custodian (or such Sub-Custodian) of evidence
of title thereto in favor of the Fund or any nominee referred to in Section 3.9
below; and (iv) in the case of repurchase or reverse repurchase agreements
entered into between the Trust and a bank which is a member of the Federal
Reserve System or between the Trust and a primary dealer in U.S. Government
securities, against delivery of the purchased Securities either in certificate
form or through an entry crediting the Custodian's account at a Book-Entry
System or Securities Depository with such Securiies;
(b) In connection with the conversion, exchange or surrender, as set
forth in Section 3.7(f) below, of Securities owned by the Fund;
<PAGE>
For the payment of any dividends or capital gain distributions declared
by a Fund; In payment of the redemption price of Shares as provided in
Section 5.1 below;
<PAGE>
(e) For the payment of any expense or liability incurred by the Fund,
including but not limited to the following payments for the account of the Fund:
interest; taxes; administration, investment advisory, accounting, auditing,
transfer agent, custodian, trustee and legal fees; and other operating expenses
of the Fund; in all cases, whether or not such expenses are to be in whole or in
part capitalized or treated as deferred expenses; For transfer in accordance
with the provisions of any agreement among the Trust, the Custodian and a
broker-dealer registered under the 1934 Act and a member of the NASD, relating
to compliance with rules of The Options Clearing Corporation and of any
registered national securities exchange (or of any similar organization or
organizations) regarding escrow or other arrangements in connection with
transactions by the Fund;
(f) For transfer in accordance with the provision of any agreement
among the Trust, the Custodian, and a futures commission merchant registered
under the Commodity Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any contract market (or any similar
organization or organizations) regarding account deposits in connection with
transactions by the Fund;
(g) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including the Custodian),
which deposit or account has a term of one year or less; and
(i) For any other proper purpose, but only upon receipt, in addition to
Proper Instructions, of a copy of a resolution of the Board of Trustees,
certified by an Officer, specifying the amount and purpose of such payment,
declaring such purpose to be a proper corporate purpose, and naming the person
or persons to whom such payment is to be made.
<PAGE>
3.7 Delivery of Securities from Fund Custody Account. Upon receipt of
Proper Instructions, the Custodian shall release and deliver Securities from a
Fund Custody Account but only in the following cases:
(a) Upon the sale of Securities for the account of the Fund but only
against receipt of payment therefor in cash, by certified or cashiers check or
bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of Section 3.5 above;
(c) To an offeror's depository agent in connection with tender or other
similar offers for Securities of the Fund; provided that, in any such case, the
cash or other consideration is to be delivered to the Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the name
of the Fund, the Custodian or any Sub-Custodian appointed pursuant to Section
3.3 above, or of any nominee or nominees of any of the foregoing, or (ii) for
exchange for a different number of certificates or other evidence representing
the same aggregate face amount or number of units; provided that, in any such
case, the new Securities are to be delivered to the Custodian;
(e) To the broker selling Securities, for examination in accordance
with the "street delivery" custom;
(f) For exchange or conversion pursuant to any plan or merger,
consolidation, recapitalization, reorganization or readjustment of the issuer of
such Securities, or pursuant to provisions for conversion contained in such
Securities, or pursuant to any deposit agreement, including surrender or receipt
of underlying Securities in connection with the issuance or cancellation of
depository receipts; provided that, in any such case, the new Securities and
cash, if any, are to be delivered to the Custodian;
<PAGE>
(g) Upon receipt of payment therefor pursuant to any repurchase or
reverse repurchase agreement entered into by the Fund;
(h) In the case of warrants, rights or similar Securities, upon the
exercise thereof, provided that, in any such case, the new Securities and cash,
if any, are to be delivered to the Custodian;
(i) For delivery in connection with any loans of Securities of the
Fund, but only against receipt of such collateral as the Trust shall have
specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by the
Fund requiring a pledge of assets by the Trust, but only against receipt by the
Custodian of the amounts borrowed;
(k) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Trust;
(l) For delivery in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered under the 1934 Act
and a member of the NASD, relating to compliance with the rules of The Options
Clearing Corporation and of any registered national securities exchange (or of
any similar organization or organizations) regarding escrow or other
arrangements in connection with transactions by the Fund;
(m) For delivery in accordance with the provisions of any agreement
among the Trust, the Custodian, and a futures commission merchant registered
under the Commodity Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any contract market (or any similar
organization or organizations) regarding account deposits in connection with
transactions by the Fund; or
<PAGE>
(n) For any other proper corporate purpose, but only upon receipt, in
addition to Proper Instructions, of a copy of a resolution of the Board Of
Trustees, certified by an Officer, specifying the Securities to be delivered,
setting forth the purpose for which such delivery is to be made, declaring such
purpose to be a proper corporate purpose, and naming the person or persons to
whom delivery of such Securities shall be made.
3.8 Actions Not Requiring Proper Instructions. Unless otherwise
instructed by the Trust, the Custodian shall with respect to all Securities held
for the Fund:
(a) Subject to Section 7.4 below, collect on a prompt and timely basis
all income and other payments to which the Fund is entitled either by law or
pursuant to custom in the securities business;
(b) Present for payment and, subject to Section 7.4 below, collect on a
timely basis the amount payable upon all Securities which may mature or be
called, redeemed, or retired, or otherwise become payable;
(c) Endorse for collection, in the name of the Fund, checks, drafts and
other negotiable instruments;
(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or certificates
of ownership under the federal income tax laws or the laws or regulations of any
other taxing authority now or hereafter in effect, and prepare and submit
reports to the Internal Revenue Service ("IRS") and to the Trust at such time,
in such manner and containing such information as is prescribed by the IRS;
<PAGE>
(f) Hold for a Fund, either directly or, with respect to Securities
held therein, through a Book-Entry System or Securities Depository, all rights
and similar securities issued with respect to Securities of the Fund; and
(g) In general, and except as otherwise directed in Proper
Instructions, attend to all non-discretionary details in connection with the
sale, exchange, substitution, purchase, transfer and other dealings with
Securities and assets of each Fund.
3.9 Registration and Transfer of Securities. All Securities held for a
Fund that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in a
Book-Entry System if eligible therefor. All other Securities held for a Fund may
be registered in the name of such Fund, the Custodian, or any Sub-Custodian
appointed pursuant to Section 3.3 above, or in the name of any nominee of any of
them, or in the name of a Book-Entry System, Securities Depository or any
nominee of either thereof. The Trust shall furnish to the Custodian appropriate
instruments to enable the Custodian to hold or deliver in proper form for
transfer, or to register in the name of any of the nominees hereinabove referred
to or in the name of a Book-Entry System or Securities Depository, any
Securities registered in the name of a Fund.
3.10 Records. (a) The Custodian shall maintain, by Fund, complete and
accurate records with respect to Securities, cash or other property held for the
Fund, including (i) journals or other records of original entry containing an
itemized daily record in detail of all receipts and deliveries of Securities and
all receipts and disbursements of cash; (ii) ledgers (or other records)
reflecting (A) Securities in transfer, (B) Securities in physical possession,
(C) monies and Securities borrowed and monies and Securities loaned (together
with a record of the collateral therefor and substitutions of such collateral),
(D) dividends and interest received, and (E) dividends receivable and interest
receivable; and (iii) canceled checks and bank records related thereto. The
Custodian shall keep such other books and records of the Funds as the Trust
shall reasonably request, or as may be required by the 1940 Act, including, but
not limited to, Section 31 of the 1940 Act and Rules 31a-1 and 31a-2 promulgated
thereunder.
<PAGE>
(b) All such books and records maintained by the Custodian shall (i) be
maintained in a form acceptable to the Trust and in compliance with rules and
regulations of the Securities and Exchange Commission, (ii) be the property of
the Trust and at all times during the regular business hours of the Custodian be
made available upon request for inspection by duly authorized officers,
employees or agents of the Trust and employees or agents of the Securities and
Exchange Commission, and (iii) if required to be maintained by Rule 31a-1 under
the 1940 Act, be preserved for the periods prescribed in Rule 31a-2 under the
1940 Act.
3.11 Fund Reports by Custodian. The Custodian shall furnish the Trust
with a daily activity statement and a summary of all transfers to or from each
Fund Custody Account on the day following such transfers. At least monthly and
from time to time, the Custodian shall furnish the Trust with a detailed
statement of the Securities and moneys held by the Custodian and the
Sub-Custodians for the Funds under this Agreement.
3.12 Other Reports by Custodian. The Custodian shall provide the Trust
with such reports, as the Trust may reasonably request from time to time, on the
internal accounting controls and procedures for safeguarding Securities, which
are employed by the Custodian or any Sub-Custodian appointed pursuant to Section
3.3 above.
3.13 Proxies and Other Materials. The Custodian shall cause all proxies
relating to Securities which are not registered in the name of a Fund, to be
promptly executed by the registered holder of such Securities, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Trust such proxies, all proxy soliciting materials and
all notices relating to such Securities.
<PAGE>
3.14 Information on Corporate Actions. The Custodian shall promptly
deliver to the Trust all information received by the Custodian and pertaining to
Securities being held by a Fund with respect to optional tender or exchange
offers, calls for redemption or purchase, or expiration of rights as described
in the Standards of Service Guide attached as Exhibit B. If the Trust desires to
take action with respect to any tender offer, exchange offer or other similar
transaction, the Trust shall notify the Custodian at least five Business Days
prior to the date on which the Custodian is to take such action. The Trust will
provide or cause to be provided to the Custodian all relevant information for
any Security which has unique put/option provisions at least five Business Days
prior to the beginning date of the tender period.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of Securities
for a Fund, Written Instructions shall be delivered to the Custodian, specifying
(a) the name of the issuer or writer of such Securities, and the title or other
description thereof, (b) the number of shares, principal amount (and accrued
interest, if any) or other units purchased, (c) the date of purchase and
settlement, (d) the purchase price per unit, (e) the total amount payable upon
such purchase, and (f) the name of the person to whom such amount is payable.
The Custodian shall upon receipt of such Securities purchased by such Fund pay
out of the moneys held for the account of that Fund the total amount specified
in such Written Instructions to the person named therein. The Custodian shall
not be under any obligation to pay out moneys to cover the cost of a purchase of
Securities for a Fund, if in the Fund Custody Account there is insufficient cash
available to the Fund for which such purchase was made.
<PAGE>
4.2 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for the purchase of Securities
for a Fund is made by the Custodian in advance of receipt of the Securities
purchased but in the absence of specified Written Instructions to so pay in
advance, the Custodian shall be liable to the Fund for such Securities to the
same extent as if the Securities had been received by the Custodian.
4.3 Sale of Securities. Promptly upon each sale of Securities by a
Fund, Written Instructions shall be delivered to the Custodian, specifying (a)
the name of the issuer or writer of such Securities, and the title or other
description thereof, (b) the number of shares, principal amount (and accrued
interest, if any), or other units sold, (c) the date of sale and settlement, (d)
the sale price per unit, (e) the total amount payable upon such sale, and (f)
the person to whom such Securities are to be delivered. Upon receipt of the
total amount payable to the Fund as specified in such Written Instructions, the
Custodian shall deliver such Securities to the person specified in such Written
Instructions. Subject to the foregoing, the Custodian may accept payment in such
form as shall be satisfactory to it, and may deliver Securities and arrange for
payment in accordance with the customs prevailing among dealers in Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above or
any other provision of this Agreement, the Custodian, when instructed to deliver
Securities against payment, shall be entitled, if in accordance with generally
accepted market practice, to deliver such Securities prior to actual receipt of
final payment therefor. In any such case, the Fund shall bear the risk that
final payment for such Securities may not be made or that such Securities may be
returned or otherwise held or disposed of by or through the person to whom they
were delivered, and the Custodian shall have no liability for any for the
foregoing.
<PAGE>
4.5 Payment for Securities Sold, etc. In its sole discretion and from
time to time, the Custodian may credit a Fund Custody Account, prior to actual
receipt of final payment thereof, with (i) proceeds from the sale of Securities
which it has been instructed to deliver against payment, (ii) proceeds from the
redemption of Securities or other assets of the Fund, and (iii) income from
cash, Securities or other assets of the Fund. Any such credit shall be
conditioned upon actual receipt by Custodian of final payment and may be
reversed if final payment is not actually received in full. The Custodian may,
in its sole discretion and from time to time, permit a Fund to use funds so
credited to the Fund Custody Account in anticipation of actual receipt of final
payment. Any such funds shall be repayable immediately upon demand made by the
Custodian at any time prior to the actual receipt of all final payments in
anticipation of which funds were credited to the applicable Fund Custody
Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its
sole discretion and from time to time, advance funds to the Trust to facilitate
the settlement of a Fund's transactions in the Fund Custody Account. Any such
advance shall be repayable immediately upon demand made by Custodian.
ARTICLE V
REDEMPTION OF FUND SHARES
5.1 Transfer of Funds. From such funds as may be available for the
purpose in the relevant Fund Custody Account, and upon receipt of Proper
Instructions specifying that the funds are required to redeem Shares of the
Fund, the Custodian shall wire each amount specified in such Proper Instructions
to or through such bank as the Trust may designate with respect to such amount
in such Proper Instructions.
<PAGE>
5.2 No Duty Regarding Paying Banks. The Custodian shall not be under
any obligation to effect payment or distribution by any bank designated in
Proper Instructions given pursuant to Section 5.1 above of any amount paid by
the Custodian to such bank in accordance with such Proper Instructions.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of a Fund, into
which account or accounts may be transferred cash and/or Securities, including
Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered under the 1934 Act
and a member of the NASD (or any futures commission merchant registered under
the Commodity Exchange Act), relating to compliance with the rules of The
Options Clearing Trust and of any registered national securities exchange (or
the Commodity Futures Trading Commission or any registered contract market), or
of any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund,
(b) for purposes of segregating cash or Securities in
connection with securities options purchased or written by the Fund or in
connection with financial futures contracts (or options thereon) purchased or
sold by the Fund,
(c) which constitute collateral for loans of Securities made by the
Fund,
<PAGE>
(d) for purposes of compliance by the Fund with requirements under the
1940 Act for the maintenance of segregated accounts by registered investment
companies in connection with reverse repurchase agreements and when-issued,
delayed delivery and firm commitment transactions, and
(e) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of the Board
Of Trustees, certified by an Officer, setting forth the purpose or purposes of
such segregated account and declaring such purposes to be proper corporate
purposes. Each segregated account established under this Article VI shall be
established and maintained for a single Fund only. All Proper Instructions
relating to a segregated account shall specify the Fund involved.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to the exercise of
reasonable care in carrying out its obligations under this Agreement, and shall
be without liability to the Trust or any Fund for any loss, damage, cost,
expense (including attorneys' fees and disbursements), liability or claim unless
such loss, damage, cost, expense, liability or claim arises from negligence, bad
faith or willful misconduct on its part or on the part of any Sub-Custodian
appointed pursuant to Section 3.3 above. The Custodian shall be entitled to rely
on and may act upon advice of counsel on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to such advice.
The Custodian shall promptly notify the Trust of any action taken or omitted by
the Custodian pursuant to advice of counsel. The Custodian shall not be under
any obligation at any time to ascertain whether the Trust or the Funds are in
compliance with the 1940 Act, the regulations thereunder, the provisions of the
Trust's charter documents or by-laws, or the Funds' investment objectives and
policies as then in effect.
<PAGE>
7.2 Actual Collection Required. The Custodian shall not be liable for,
or considered to be the custodian of, any cash belonging to a Fund or any money
represented by a check, draft or other instrument for the payment of money,
until the Custodian or its agents actually receive such cash or collect on such
instrument.
7.3 No Responsibility for Title, etc. So long as and to the extent that
it is exercising of reasonable care, the Custodian shall not be responsible for
the title, validity or genuineness of any property or evidence of title thereto
received or delivered by it pursuant to this Agreement.
7.4 Limitation on Duty to Collect. Custodian shall not be required to
enforce collection, by legal means or otherwise, of any money or property due
and payable with respect to Securities held for the Fund if such Securities are
in default or payment is not made after due demand or presentation. Custodian
shall promptly notify an Officer of the Trust in writing of any amounts of money
or property due and payable with respect to Securities held for a Fund which the
Custodian has not received after due demand or presentation.
7.5 Reliance Upon Documents and Instructions. The Custodian shall be
entitled to rely upon any certificate, notice or other instrument in writing
received by it and reasonably believed by it to be genuine. The Custodian shall
be entitled to rely upon any Oral Instructions and any Written Instructions
actually received by it pursuant to this Agreement.
<PAGE>
7.6 Express Duties Only. The Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are specifically
set forth in this Agreement, and no covenant or obligation shall be implied in
this Agreement against the Custodian.
7.7 Co-operation. The Custodian shall cooperate with and supply
necessary information to the entity or entities appointed by the Trust to keep
the books of account of the Funds and/or compute the value of the assets of the
Funds. The Custodian shall take all such reasonable actions as the Trust may
from time to time request to enable the Trust to obtain, from year to year,
favorable opinions from the Trust's independent accountants with respect to the
Custodian's activities hereunder in connection with (a) the preparation of the
Trust's reports on Form N-1A and Form N-SAR and any other reports required by
the Securities and Exchange Commission, and (b) the fulfillment by the Trust of
any other requirements of the Securities and Exchange Commission.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification by Trust. The Trust shall indemnify and hold
harmless the Custodian and any Sub-Custodian appointed pursuant to Section 3.3
above, and any nominee of the Custodian or of such Sub-Custodian, from and
against any loss, damage, cost, expense (including attorneys' fees and
disbursements), liability (including, without limitation, liability arising
under the Securities Act of 1933, the 1934 Act, the 1940 Act, and any state or
foreign securities and/or banking laws to the extent permitted by law or public
policy) or claim arising directly or indirectly (a) from the fact that
Securities are registered in the name of any such nominee, or (b) from any
action or inaction by the Custodian or such Sub-Custodian (i) at the request or
direction of or in reliance on the advice of the Trust, or (ii) upon Proper
Instructions, or (c) generally, from the performance of its obligations under
this Agreement, provided that neither the Custodian nor any such Sub-Custodian
shall be indemnified or held harmless from and against any such loss, damage,
cost, expense, liability or claim arising from the Custodian's or such
Sub-Custodian's negligence, bad faith or willful misconduct.
<PAGE>
8.2 Indemnification by Custodian. The Custodian shall indemnify and
hold harmless the Trust from and against any loss, damage, cost, expense
(including attorneys' fees and disbursements), liability (including without
limitation, liability arising under the Securities Act of 1933, the 1934 Act,
the 1940 Act, and any state or foreign securities and/or banking laws to the
extent permitted by law or public policy) or claim arising from the negligence,
bad faith or willful misconduct of the Custodian or any Sub-Custodian appointed
pursuant to Section 3.3 above, or any nominee of the Custodian or of such
Sub-Custodian.
8.3 Indemnity to be Provided. If the Trust requests the Custodian to
take any action with respect to Securities, which may, in the opinion of the
Custodian, result in the Custodian or its nominee becoming liable for the
payment of money or incurring liability of some other form, the Custodian shall
not be required to take such action until the Trust shall have provided
indemnity therefor to the Custodian in an amount and form satisfactory to the
Custodian.
8.4 Security. If the Custodian advances cash or Securities to the Fund
for any purpose, either at the Trust's request or as otherwise contemplated in
this Agreement then, in any such event, property at that time held for the
account of such Fund in an amount equal to no more than the current value of
such advance shall be security therefor, and should the Fund fail promptly to
repay the Custodian, the Custodian shall be entitled to utilize available cash
of such Fund and to dispose of other assets of such Fund to the extent necessary
to obtain reimbursement.
<PAGE>
ARTICLE IX
FORCE MAJEURE
Neither the Custodian nor the Trust shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian in the event of a failure
or delay (i) shall not discriminate against the Funds in favor of any other
customer of the Custodian in making computer time and personnel available to
input or process the transactions contemplated by this Agreement and (ii) shall
use its best efforts to ameliorate the effects of any such failure or delay.
ARTICLE X
EFFECTIVE PERIOD; TERMINATION
10.1 Effective Period. This Agreement shall become effective as of its
execution and shall continue in full force and effect until terminated as
hereinafter provided.
<PAGE>
10.2 Termination. Either party hereto may terminate this Agreement by
giving to the other party a notice in writing specifying the date of such
termination, which shall be not less than sixty (60) days after the date of the
giving of such notice. If a successor custodian shall have been appointed by the
Board Of Trustees, the Custodian shall, upon receipt of a notice of acceptance
by the successor custodian, on such specified date of termination (a) deliver
directly to the successor custodian all Securities (other than Securities held
in a Book-Entry System or Securities Depository) and cash then owned by the Fund
and held by the Custodian as custodian, and (b) transfer any Securities held in
a Book-Entry System or Securities Depository to an account of or for the benefit
of the Funds at the successor custodian, provided that the Trust shall have paid
to the Custodian all fees, expenses and other amounts to the payment or
reimbursement of which it shall then be entitled. Upon such delivery and
transfer, the Custodian shall be relieved of all obligations under this
Agreement. The Trust may at any time immediately terminate this Agreement in the
event of the appointment of a conservator or receiver for the Custodian by
regulatory authorities or upon the happening of a like event at the direction of
an appropriate regulatory agency or court of competent jurisdiction.
10.3 Failure to Appoint Successor Custodian. If a successor custodian
is not designated by the Trust on or before the date of termination specified
pursuant to Section 10.2 above, then the Custodian shall have the right to
deliver to a bank or corporation company of its own selection, which (a) is a
"bank" as defined in the 1940 Act and (b) has aggregate capital, surplus and
undivided profits as shown on its then most recent published report of not less
than $25 million, all Securities, cash and other property held by Custodian
under this Agreement and to transfer to an account of or for the Funds at such
bank or trust company all Securities of the Funds held in a Book-Entry System
or Securities Depository. Upon such delivery and transfer, such bank or trust
company shall be the successor custodian under this Agreement and the
Custodian shall be relieved of all obligations under this Agreement.
<PAGE>
ARTICLE XI
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from
time to time by the Trust and the Custodian. The fees and other charges in
effect on the date hereof and applicable to the Fund are set forth in Exhibit C
attached hereto.
ARTICLE XII
LIMITATION OF LIABILITY
Davis Park Series Trust is a business trust organized under Chapter
1746, Ohio Revised Code, and under a Declaration of Trust to which reference is
hereby made and a copy of which is on file at the office of the Secretary of the
State of Ohio as required by law, and to any and all amendments thereto so filed
or hereafter filed. The obligations of "Davis Park Series Trust" entered into in
the name or on behalf thereof by any of the Trustees, officers, employees or
agents are made not individually, but in such capacities, and are not binding
upon any of the Trustees, shareholders, officers, employees or agents of the
Trust personally, but bind only the assets of the Trust, as set forth in Section
1746.13(A), Ohio Revised Code, and all persons dealing with any of the Funds of
the Trust must look solely to the assets of the Trust belonging to such Fund for
the enforcement of any claims against the Trust.
<PAGE>
ARTICLE XIII
NOTICES
Unless otherwise specified herein, all demands, notices, instructions,
and other communications to be given hereunder shall be in writing and shall be
sent or delivered to the recipient at the address set forth after its name
hereinbelow:
To the Trust:
Ameristock Corporation
Attn: Nicholas D. Gerber
Po Box 6919
Moraga, CA 94510
To Custodian:
Firstar Bank, N.A.
425 Walnut Street, M.L. CN-WN-06TC
Cincinnati, Ohio 45202
Attention: Mutual Fund Custody Services
Telephone: (513) 632-3905
Facsimile: (513) 632-
or at such other address as either party shall have provided to the other by
notice given in accordance with this Article XIII. Writing shall include
transmissions by or through teletype, facsimile, central processing unit
connection, on-line terminal and magnetic tape.
ARTICLE XIV
MISCELLANEOUS
14.1 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Ohio.
14.2 References to Custodian. The Trust shall not circulate any printed
matter which contains any reference to Custodian without the prior written
approval of Custodian, excepting printed matter contained in the prospectus or
statement of additional information for the Funds and such other printed matter
as merely identifies Custodian as custodian for a Fund. The Trust shall submit
printed matter requiring approval to Custodian in draft form, allowing
sufficient time for review by Custodian and its counsel prior to any deadline
for printing.
<PAGE>
14.3 No Waiver. No failure by either party hereto to exercise, and no
delay by such party in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by either party hereto of any right hereunder shall not
preclude the exercise of any other right, and the remedies provided herein are
cumulative and not exclusive of any remedies provided at law or in equity.
14.4 Amendments. This Agreement cannot be changed orally and no
amendment to this Agreement shall be effective unless evidenced by an instrument
in writing executed by the parties hereto.
14.5 Counterparts. This Agreement may be executed in one or more
counterparts, and by the parties hereto on separate counterparts, each of which
shall be deemed an original but all of which together shall constitute but one
and the same instrument.
14.6 Severability. If any provision of this Agreement shall be invalid,
illegal or unenforceable in any respect under any applicable law, the validity,
legality and enforceability of the remaining provisions shall not be affected or
impaired thereby.
14.7 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns; provided, however, that this Agreement shall not be assignable by
either party hereto without the written consent of the other party hereto.
14.8 Headings. The headings of sections in this Agreement are for
convenience of reference only and shall not affect the meaning or construction
of any provision of this Agreement.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered in its name and on its behalf by its
representatives thereunto duly authorized, all as of the day and year first
above written.
ATTEST:
Davis Park Series Trust
By:
----------------------------- ------------------------------
ATTEST: FIRSTAR BANK, N.A.
By:
----------------------------- ------------------------------
<PAGE>
EXHIBIT A
AUTHORIZED PERSONS
Set forth below are the names and specimen signatures of the persons
authorized by the Trust to administer the Fund Custody Accounts.
Authorized Persons Specimen Signatures
President:
-------------------
Secretary:
-------------------
Treasurer:
-------------------
Vice President:
-------------------
Adviser Employees:
-------------------
Transfer Agent/Fund Accountant
Employees:
-------------------
-------------------
-------------------
-------------------
<PAGE>
EXHIBIT B
Firstar Institutional Custody Services
Standards of Service Guide
July, 1999
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
<TABLE>
<S> <C> <C>
Transaction Type Instructions Deadlines* Delivery Instructions
DTC 1:30 P.M. on Settlement Date DTC Participant #2803
Agent Bank ID 27895
Institutional #
------------
For Account #
------------
Federal Reserve Book Entry 12:30 P.M. on Settlement Date Federal Reserve Bank of Cinti/Trust
for Firstar Bank, N.A. ABA# 042000013
For Account #
------------
Fed Wireable FNMA & FHLMC 12:30 P.M. on Settlement Date Bk of NYC/Cust
ABA 021000018
A/C Firstar Bank # 117612
For Account #
------------
Federal Reserve Book Entry (Repurchase 1:00 P.M. on Settlement Date Federal Reserve Bank of Cinti/Spec
Agreement Collateral Only) for Firstar Bank, N.A. ABA# 042000013
For Account #
------------
PTC Securities 12:00 P.M. on Settlement Date PTC For Account BYORK
(GNMA Book Entry) Firstar Bank / 117612
Physical Securities 9:30 A.M. EST on Settlement Date Bank of New York
(for Deliveries, by 4:00 P.M. on One Wall Street- 3rd Floor - Window A
Settlement Date minus 1) New York, NY 10286
For account of Firstar Bank / Cust #117612
Attn: Donald Hoover
CEDEL/EURO-CLEAR 11:00 A..M. on Cedel a/c 55021
Settlement Date minus 2 FFC: a/c 387000
Firstar Bank / Global Omnibus
Cash Wire Transfer 3:00 P.M. Firstar Bank,N.A. Cinti/Trust
ABA#
Credit Account #
Further Credit to
-------------
Account #
--------------
</TABLE>
* 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>
Firstar Bank Corporate Reorganization Standards
<TABLE>
<S> <C> <C> <C>
Type of Action Notification to Client Deadline for Client Instructions Transaction
to Firstar Bank Posting
Rights, Warrants, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
and Optional Mergers expiration or receipt of notice
Mandatory Puts with Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Option to Retain expiration or receipt of notice
Class Actions 10 business days prior to expiration 5 business days prior to expiration Upon receipt
date
Voluntary Tenders, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Exchanges, expiration or receipt of notice
and Conversions
Mandatory Puts, Defaults, At posting of funds or securities None Upon receipt
Liquidations, Bankruptcies, received
Stock Splits, Mandatory
Exchanges
Full and Partial Calls Later of 10 business days prior to None Upon receipt
expiration or receipt of notice
</TABLE>
NOTE: Fractional shares/par amounts resulting from
any of the above will be sold.
<PAGE>
EXHIBIT C
Firstar Institutional Custody Services
Proposed Domestic Custody Fee Schedule for
Ameristock Fund
Firstar Institutional Custody Services, as Custodian, will receive monthly
compensation for services according to the terms of the following Schedule:
I. Portfolio Transaction Fees:
(a) For each repurchase agreement transaction $7.00
(b) For each portfolio transaction processed through
DTC or Federal Reserve $9.00
(c) For each portfolio transaction processed through
our New York custodian $25.00
(d) Mutual Fund Trades $15.00
(e) For each GNMA/Amortized Security Purchase $25.00
(f) For each GNMA Prin/Int Paydown, GNMA Sales $8.00
(g) For each covered call option/future contract written,
exercised or expired $10.00
(h) For each Cedel/Euro clear transaction $80.00
(i) For each Disbursement (Fund expenses only) $5.00
A transaction is a purchase/sale of a security, free receipt/free delivery
(excludes initial conversion), maturity, tender or exchange:
II. Market Value Fee
Based upon an annual rate of: Million
.0003 (3 Basis Points) on First $20
.0002 (2 Basis Points) on Next $30
.00015 (1.5 Basis Points) on Balance
III. Monthly Minimum Fee-Per Fund $300.00
IV. Out-of-Pocket Expenses
The only out-of-pocket expenses charged to your account will be
shipping fees or transfer fees.
V. IRA Documents
Per Shareholder/year to hold each IRA Document $5.00
VI. Earnings Credits
On a monthly basis any earnings credits generated from uninvested
custody balances will be applied against any cash management service
fees generated.
7/14/2000 Firstar has agreed to reduce the IRA Custody fee Section V from $8.00
to $5.00 per a conference call on this date between Alps and Firstar.
<PAGE>
Revised: August 11, 2000
EXHIBIT D
Ameristock Large Company Growth Fund
Ameristock Focused Value Fund
<PAGE>
EXHIBIT h(1)
TRANSFER AGENT AGREEMENT
THIS AGREEMENT is made and entered into this day of ,
------ ------------
2000, by and between Davis Park Series Trust, a Delaware business trust (the
"Fund"), and Mutual Shareholder Services LLC ("MSS").
RECITALS:
A. The Fund is a 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;
(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
<PAGE>
(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.
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.
<PAGE>
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 Delaware.
4.02 It is empowered under applicable laws and by its Declaration of
Trust and By-Laws to enter into and perform this Agreement.
4.03 All corporate proceedings required by said Declaration of Trust
and By-Laws have been taken to authorize it to enter into and perform this
Agreement.
4.04 It is an open-end and diversified management investment company
registered under the 1940 Act.
4.05 A registration statement under the Securities Act of 1933 is
currently or will become effective and will remain effective, and appropriate
state securities law filings as required, have been or will be made and will
continue to be made, with respect to all Shares of the 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 good faith, gross
negligence or willful misconduct or which arise out of the breach of
any representation or warranty of the Fund hereunder.
(c)The reliance on or use by MSS or its agents or subcontractors
of information, records and documents which (i) are received by MSS or
its agents or subcontractors and furnished to it by or on behalf of the
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 negligence
or willful misconduct.
<PAGE>
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.
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.
<PAGE>
7. TERM OF AGREEMENT
7.01 This Agreement shall become effective as of the date hereof and
shall remain in force for a period of three years; provided, however, that each
party to this Agreement have the option to terminate the Agreement without
penalty, upon 90 days prior written notice.
7.02 Should the 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 Trustees 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:
Davis Park Series Trust Mutual Shareholder Services LLC
P.O. Box 6919 The Tower at Erieview, Suite 1005
Moraga, CA 94570 1301 East Ninth Street
Cleveland, OH 44114
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
DAVIS PARK SERIES TRUST MUTUAL SHAREHOLDER SERVICES LLC
By: By:
---------------------------------- ----------------------------------
Nicholas D. Gerber, Chairman
Its:
----------------------------------
<PAGE>
EXHIBIT "A"
FEE SCHEDULE
The following fees will be paid in respect of each portfolio of the Fund:
Shareholder Servicing Fees all funds together
11.50 annual fee per shareholder / Non-FundServ accounts
6.00 annual fee per shareholder / FundServ accounts
min of $775.00 charge per month
Blue Sky Servicing Fees discounts do not apply
100.00 per state per filing
* All fees discounted as follows:
Discount Net assets of Fund
60% - 500,000
50% 500,000 1,000,000
45% 1,000,000 2,000,000
40% 2,000,000 3,000,000
35% 3,000,000 4,000,000
30% 4,000,000 5,000,000
25% 5,000,000 6,000,000
20% 6,000,000 7,000,000
15% 7,000,000 8,000,000
10% 8,000,000 9,000,000
5% 9,000,000 10,000,000
0% 10,000,000 -
<PAGE>
EXHIBIT h(2)
ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made and entered into this day of ,
------ ------------
2000, by and between Davis Park Series Trust, a Delaware business trust (the
"Fund"), and Mutual Shareholder Services LLC ("MSS").
RECITALS:
A. The Fund is a 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:
Cash receipts journal
Cash disbursements journal
Dividend record
Purchase and sales - portfolio securities journals
Subscription and redemption journals
Security ledgers
` Broker ledger
General ledger
Daily expense accruals
Daily income accruals
Securities and monies borrowed or loaned and collateral
therefore
Foreign currency journals
Trial balances
<PAGE>
(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 advisor of the
following:
1. Semi-annual financial statements;
2. Semi-annual form N-SAR;
3. Annual tax returns;
4. Financial data necessary to update form N-1A;
5. Annual proxy statement.
(e)Provide facilities to accommodate annual audit and any audits
or examinations conducted by the Securities and Exchange Commission or
any other governmental or quasi-governmental entities with
jurisdiction.
MSS shall for all purposes herein be deemed to be an independent contractor and
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the 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 reimburseable expenses
within five days following the receipt of the respective billing
notice.
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.
<PAGE>
(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.
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.
<PAGE>
(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.
(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:
Davis Park Series Trust Mutual Shareholder Services LLC
P.O. Box 6919 The Tower at Erieview, Suite 1005
Moraga, CA 94570 1301 East Ninth Street
Cleveland, OH 44114
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
DAVIS PARK SERIES TRUST MUTUAL SHAREHOLDER SERVICES LLC
By: By:
------------------------------------- -------------------------------
Nicholas D. Gerber, Chairman
Its:
------------------------------
<PAGE>
EXHIBIT A
FEE SCHEDULE
The following fees will be paid in respect of each portfolio of the Fund:
Accounting Fees per fund
If average value of fund is
between the following
Yearly Fee Monthly Fee
- 25,000,000 21,000 1,750
25,000,000 50,000,000 30,500 2,542
50,000,000 75,000,000 36,250 3,021
75,000,000 100,000,000 42,000 3,500
100,000,000 125,000,000 47,750 3,979
125,000,000 150,000,000 53,500 4,458
150,000,000 - 59,250 4,938
* All fees discounted as follows:
Discount Net assets of Fund
60% - 500,000
50% 500,000 1,000,000
45% 1,000,000 2,000,000
40% 2,000,000 3,000,000
35% 3,000,000 4,000,000
30% 4,000,000 5,000,000
25% 5,000,000 6,000,000
20% 6,000,000 7,000,000
15% 7,000,000 8,000,000
10% 8,000,000 9,000,000
5% 9,000,000 10,000,000
0% 10,000,000 11,000,000
11,000,000 -
<PAGE>
