1933 Act File No. 2-65447
1940 Act File No. 811-2956
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No.
Post-Effective Amendment No. 32 X
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 25 X
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
(Exact Name of Registrant as Specified in Charter)
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire,
Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
immediately upon filing pursuant to paragraph (b)
on _________________ pursuant to paragraph (b)
X 60 days after filing pursuant to paragraph (a) (i)
on pursuant to paragraph (a) (i).
75 days after filing pursuant to paragraph (a)(ii)
on _________________ pursuant to paragraph (a)(ii) of Rule 485.
If appropriate, check the following box:
This post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
Registrant has filed with the Securities and Exchange Commission
a declaration pursuant to Rule 24f-2 under the Investment Company
Act of 1940, and:
X filed the Notice required by that Rule on MAY 16, 1994; or
intends to file the Notice required by that Rule on or about
____________; or
during the most recent fiscal year did not sell any
securities pursuant to Rule 24f-2 under the Investment Company
Act of 1940, and, pursuant to Rule 24f-2(b)(2), need not file
the Notice.
Copies to:
Thomas J. Donnelly, Esquire Charles H. Morin, Esquire
Houston, Houston & Donnelly Dickstein, Shapiro & Morin,
L.L.P.
2510 Centre City Tower 2101 L Street, N.W.
650 Smithfield Street Washington, D.C. 20037
Pittsburgh, Pennsylvania 15222
CROSS REFERENCE SHEET
This Amendment to the Registration Statement of LIBERTY U.S.
GOVERNMENT MONEY MARKET TRUST (the "Trust"), which consists of
one investment portfolio with two classes of shares: (a) Class A
Shares ; and (b) Class B Shares, relates only to the Class B
Shares of the Trust and is comprised of the following:
PART A. INFORMATION REQUIRED IN A PROSPECTUS.
Prospectus Heading
(Rule 404(c) Cross
Reference)
Item 1. Cover Page Cover Page.
Item 2. Synopsis Summary of Trust Expenses.
Item 3. Condensed Financial
Information Financial Highlights.
Item 4. General Description of
Registrant Performance Information;
General Information; Liberty
Family of Funds; Investment
Information; Investment
Objective; Investment
Policies; Investment
Limitations.
Item 5. Management of the Trust Trust Information; Management
of the Trust; (a) Distribution
of Trust Shares; (b)
Distribution of Class B
Shares; Administration of the
Trust.
Item 6. Capital Stock and Other
Securities Dividends; Capital Gains;
Shareholder Information;
Voting Rights; Massachusetts
Partnership Law; Tax
Information; Federal Income
Tax; Pennsylvania Corporate
and Personal Property Taxes.
Item 7. Purchase of Securities Being
Offered Net Asset Value; (a) Investing
in the Trust; (b) Investing in
Class B Shares; Share
Purchases; (a) Minimum
Investment Required; (a) What
Shares Cost; (a) Systematic
Investment Program;
Certificates and
Confirmations; (a) Conversion
to Federal Funds; Retirement
Plans; Exchange Privilege;
Requirements for Exchange; Tax
Consequences; Making an
Exchange.
Item 8. Redemption or Repurchase (a) Redeeming Shares; (b)
Redeeming Class B Shares;
Through a Financial
Institution; Directly From the
Trust; Contingent Deferred
Sales Charge; Systematic
Withdrawal Program; Accounts
with Low Balances.
Item 9. Pending Legal Proceedings None.
PART B. INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL
INFORMATION
Item 10. Cover Page.................. Cover Page.
Item 11. Table of Contents........... Table of Contents.
Item 12. General Information and
History General Information About the
Trust.
Item 13. Investment Objectives and
Policies Investment Objective and
Policies.
Item 14. Management of the Fund....... See Part A - Management
of the Trust; The Funds.
Item 15. Control Persons and Principal
Holders of Securities See Part A. Trust Ownership.
Item 16. Investment Advisory and Other
Services Investment Advisory Services;
Administrative Services;
Shareholder Services Plan.
Item 17. Brokerage Allocation Brokerage Transactions.
Item 18. Capital Stock and Other
Securities Not Applicable.
Item 19. Purchase, Redemption and Pricing
of Securities Being Offered Purchasing Shares;
Determining Net Asset Value;
Redeeming Shares.
Item 20. Tax Status Tax Status.
Item 21. Underwriters See Part A. Distribution of
Trust Shares.
Item 22. Calculation of Yield Quotations
of Money Market Funds Yield; Effective Yield;
Performance Comparisons.
Item 23. Financial Statements Financial Statements
(Financial Statements for
Class A Shares are
incorporated by reference to
Annual Report of Registrant
dated March 31, 1994) (File
Nos. 2-65447 and 811-2956).
Financial Statements for Class
B Shares are to be filed by
amendment.
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
CLASS B SHARES
PROSPECTUS
The Class B Shares of Liberty U.S. Government Money Market Trust (the "Trust")
represent interests in an open-end, diversified management investment company (a
mutual fund) investing in short-term U.S. government securities to achieve
stability of principal and current income consistent with stability of
principal.
AN INVESTMENT IN THE TRUST IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT. THE TRUST ATTEMPTS TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER
SHARE; THERE CAN BE NO ASSURANCE THAT THE TRUST WILL BE ABLE TO DO SO.
THE SHARES OFFERED BY THIS PROSPECTUS ARE NOT DEPOSITS OR OBLIGATIONS OF ANY
BANK, ARE NOT ENDORSED OR GUARANTEED BY ANY BANK, AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
GOVERNMENT AGENCY.
This prospectus contains the information you should read and know before you
invest in the Class B Shares of the Trust. Keep this prospectus for future
reference.
The Trust has also filed a Combined Statement of Additional Information for
Class A Shares and Class B Shares dated December , 1994, with the Securities
and Exchange Commission. The information contained in the Combined Statement of
Additional Information is incorporated by reference into this prospectus. You
may request a copy of the Combined Statement of Additional Information free of
charge by calling 1-800-235-4669. To obtain other information or to make
inquiries about the Trust, contact your financial institution.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Prospectus dated December , 1994
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
SUMMARY OF TRUST EXPENSES 1
- ------------------------------------------------------
GENERAL INFORMATION 2
- ------------------------------------------------------
LIBERTY FAMILY OF FUNDS 2
- ------------------------------------------------------
INVESTMENT INFORMATION 3
- ------------------------------------------------------
Investment Objective 3
Investment Policies 4
Acceptable Investments 4
Instruments of Banks and Savings
and Loan Associations 4
Repurchase Agreements 4
When-Issued and Delayed Delivery
Transactions 4
Investment Limitations 5
Regulatory Compliance 5
NET ASSET VALUE 5
- ------------------------------------------------------
Conversion of Class B Shares 5
INVESTING IN CLASS B SHARES 6
- ------------------------------------------------------
Share Purchases 6
Through a Financial Institution 6
Certificates and Confirmations 6
Dividends 6
Capital Gains 6
Retirement Plans 7
EXCHANGE PRIVILEGE 7
- ------------------------------------------------------
Requirements for Exchange 7
Tax Consequences 7
Making an Exchange 7
Telephone Instructions 8
REDEEMING CLASS B SHARES 8
- ------------------------------------------------------
Through a Financial Institution 8
Directly From the Trust 8
By Telephone 8
By Mail 9
Signatures 9
Contingent Deferred Sales Charge 9
Elimination of Contingent Deferred
Sales Charge 10
Systematic Withdrawal Program 11
Accounts with Low Balances 11
TRUST INFORMATION 11
- ------------------------------------------------------
Management of the Trust 11
Board of Trustees 11
Officers and Trustees 11
Trust Ownership 15
Trustee Liability 15
Investment Adviser 15
Advisory Fees 15
Adviser's Background 15
Distribution of Class B Shares 16
Distribution and Shareholder Services
Plans 16
Administration of the Trust 17
Administrative Services 17
Custodian 17
Transfer Agent and
Dividend Disbursing Agent 17
Legal Counsel 17
Independent Public Accountants 17
Expenses of the Trust and Class B
Shares 17
SHAREHOLDER INFORMATION 18
- ------------------------------------------------------
Voting Rights 18
Massachusetts Partnership Law 18
TAX INFORMATION 19
- ------------------------------------------------------
Federal Income Tax 19
Pennsylvania Corporate and Personal
Property Taxes 19
PERFORMANCE INFORMATION 19
- ------------------------------------------------------
OTHER CLASS OF SHARES 20
- ------------------------------------------------------
FINANCIAL HIGHLIGHTS--CLASS A SHARES 21
- ------------------------------------------------------
SUMMARY OF TRUST EXPENSES
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
CLASS B SHARES
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price)................................. None
Maximum Sales Load Imposed on Reinvested Dividends (as a percentage of offering price)...................... None
Contingent Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds as applicable) (1).................................................. 5.50%
Redemption Fee (as a percentage of amount
redeemed, if applicable).................................................................................. None
Exchange Fee................................................................................................ None
ANNUAL CLASS B SHARES OPERATING EXPENSES*
(As a percentage of projected average net assets)
Management Fee.............................................................................................. 0.49%
12b-1 Fee................................................................................................... 0.75%
Total Other Expenses........................................................................................ 0.65%
Shareholder Services Fee (after waiver) (2).................................................. 0.11%
Total Class B Shares Operating Expenses (3)(4)...................................................... 1.89%
</TABLE>
- ---------
(1) The contingent deferred sales charge schedule applicable to a shareholder's
redemption of Class B Shares of the Trust is the schedule applicable to
redemption of Class B Shares of the Liberty Family fund originally purchased
by the shareholder. The contingent deferred sales charge reflected in this
table is 5.50% in the first year, declining to 1.00% in the sixth year and
0.00% thereafter. This is the highest such schedule applicable to Shares of
the Trust. (See "Contingent Deferred Sales Charge.").
(2) The maximum shareholder services fee is 0.25%.
(3) Class B Shares convert to Class A Shares (which pay lower ongoing expenses)
approximately eight years after purchase.
(4) The total Class B Shares Operating Expenses are estimated to be 2.03% absent
the anticipated voluntary waiver of a portion of the shareholer services
fee.
* Total Class B Shares Operating Expenses are estimated based on average
expenses expected to be incurred during the period ending March 31, 1995.
During the course of this period, expenses may be more or less than the
average amount shown.
THE PURPOSE OF THIS TABLE IS TO ASSIST AN INVESTOR IN UNDERSTANDING THE
VARIOUS COSTS AND EXPENSES THAT A SHAREHOLDER OF CLASS B SHARES OF THE TRUST
WILL BEAR, EITHER DIRECTLY OR INDIRECTLY. FOR MORE COMPLETE DESCRIPTIONS OF THE
VARIOUS COSTS AND EXPENSES, SEE "TRUST INFORMATION" AND "INVESTING IN CLASS B
SHARES." Wire-transferred redemptions of less than $5,000 may be subject to
additional fees.
LONG-TERM SHAREHOLDERS MAY PAY MORE THAN THE ECONOMIC EQUIVALENT OF THE
MAXIMUM FRONT-END SALES LOAD PERMITTED UNDER THE RULES OF THE NATIONAL
ASSOCIATION OF SECURITIES DEALERS, INC.
<TABLE>
<CAPTION>
EXAMPLE 1 year 3 years
<S> <C> <C>
You would pay the following expenses on a $1,000 investment assuming
(1) 5% annual return and (2) redemption at the end of each period..........................(a) $76 $103
You would pay the following expenses on the same investment,
assuming no redemption........................................................................ $19 $59
</TABLE>
(a) Assumes the highest applicable contingent deferred sales charge schedule.
See note (1) above.
THE ABOVE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. THIS
EXAMPLE IS BASED ON ESTIMATED DATA FOR THE TRUST'S FISCAL YEAR ENDING MARCH 31,
1995.
The information set forth in the foregoing table and example relates only to
Class B Shares of the Trust. The Trust also offers an additional class of shares
called Class A Shares. Class A Shares and Class B Shares are subject to certain
of the same expenses; however, Class A Shares are not subject to a contingent
deferred sales charge or a 12b-1 fee. See "Other Classes of Shares."
GENERAL INFORMATION
- --------------------------------------------------------------------------------
The Trust, formerly AARP U.S. Government Money Market Trust, was established as
a Massachusetts business trust under a Declaration of Trust dated August 30,
1979. The Trust's address is Liberty Center, Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779. The Trust invests in U.S. government
obligations maturing in one year or less. The Trust is permitted, under its
Declaration of Trust, to offer separate series of shares representing interests
in separate portfolios of securities. The shares in any one portfolio may be
offered in separate classes. As of the date of this prospectus, the Board of
Trustees ("Trustees") has established two classes of shares, known as Class A
Shares and Class B Shares. This prospectus relates only to Class B Shares
("Shares") of the Trust.
Class B Shares of the Trust are designed primarily for individuals and
institutions as a convenient means of accumulating an interest in a
professionally managed, diversified portfolio primarily limited to U.S.
government obligations. Class B Shares are available only by exchange from Class
B Shares of other Liberty Family funds.
The Trust attempts to stabilize the value of a Share at $1.00. Except as
otherwise noted in this prospectus, Class B Shares are sold at net asset value
and are redeemed at net asset value. However, a contingent deferred sales charge
is imposed on certain shares which are redeemed within six full years of
original purchase of Liberty Family Class B Shares. For a more complete
description, see "Redeeming Class B Shares."
In addition, the Trust pays a distribution fee to the distributor at an annual
rate not to exceed 0.75% of the Shares' average daily net assets. These
distribution fees, while exceeding those paid by certain other money market
funds, are comparable to fees paid by money market funds issuing comparable
shares. For a more complete description, see "Distribution and Shareholder
Services Plans."
LIBERTY FAMILY OF FUNDS
- --------------------------------------------------------------------------------
This Trust is a member of a family of mutual funds, collectively known as the
Liberty Family of Funds. The other funds in the Family are:
. American Leaders Fund, Inc., providing growth of capital and income
through high-quality stocks;
. Capital Growth Fund, providing appreciation of capital primarily through
equity securities;
. Fund for U.S. Government Securities, Inc., providing current income
through long-term U.S. government securities;
. International Equity Fund, providing long-term capital growth and income
through international securities;
. International Income Fund, providing a high level of current income
consistent with prudent investment risk through high-quality debt
securities denominated primarily in foreign currencies;
. Liberty Equity Income Fund, Inc., providing above-average income and
capital appreciation through income-producing equity securities;
. Liberty High Income Bond Fund, Inc., providing high current income
through high-yielding, lower-rated corporate bonds;
. Liberty Municipal Securities Fund, Inc., providing a high level of
current income exempt from federal regular income tax through municipal
bonds;
. Liberty Utility Fund, Inc., providing current income and long-term growth
of income, primarily through electric, gas and communication utilities;
. Limited Term Fund, providing a high level of current income consistent
with minimum fluctuation in principal value through investment grade
securities;
. Limited Term Municipal Fund, providing a high level of current income
exempt from federal regular income tax consistent with the preservation
of principal, primarily limited to municipal securities;
. Michigan Intermediate Municipal Trust, providing current income exempt
from federal regular income tax and the personal income taxes imposed by
the state of Michigan and Michigan municipalities, primarily through
Michigan municipal securities;
. Pennsylvania Municipal Income Fund, providing current income exempt from
federal regular income tax and the personal income taxes imposed by the
Commonwealth of Pennsylvania, primarily through Pennsylvania municipal
securities;
. Strategic Income Fund, providing a high level of current income,
primarily through domestic and foreign corporate debt obligations;
. Tax-Free Instruments Trust, providing current income consistent with
stability of principal and exempt from federal income tax, through
high-quality, short-term municipal securities; and
. World Utility Fund, providing total return through securities issued by
domestic and foreign companies in the utilities industries.
Prospectuses for these funds are available by writing to Federated Securities
Corp.
Each of the funds may also invest in certain other types of securities as
described in each fund's prospectus.
The Liberty Family of Funds provides flexibility and diversification for an
investor's long-term investment planning. It enables an investor to meet the
challenges of changing market conditions by offering convenient exchange
privileges which give access to various investment vehicles and by providing the
investment services of a proven, professional investment adviser.
INVESTMENT INFORMATION
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The investment objective of the Trust is stability of principal and current
income consistent with stability of principal. The Trust pursues this investment
objective by investing in a portfolio of U.S. government obligations maturing in
thirteen months (397 days) or less. The average maturity of U.S. government
securities in the Trust's portfolio, computed on a dollar-weighted basis, will
be 90 days or less. While there is no assurance that the Trust will achieve its
investment objective, it endeavors to do so by following the investment policies
described in this prospectus. The investment objective and the policies and
limitations described below cannot be changed without approval of shareholders.
INVESTMENT POLICIES
ACCEPTABLE INVESTMENTS. The U.S. government securities in which the Trust
invests are either issued or guaranteed by the U.S. government, its agencies, or
instrumentalities. These securities include, but are not limited to:
. direct obligations of the U.S. Treasury such as U.S. Treasury bills,
notes, and bonds;
. notes, bonds, and discount notes of U.S. government agencies or
instrumentalities such as Farm Credit System, Federal Home Loan Banks,
Federal National Mortgage Association, and Government National Mortgage
Association; and
. short-term instruments of banks and savings and loan associations in
which the principal is fully insured by the Bank Insurance Fund or the
Savings Association Insurance Fund, both of which are administered by the
Federal Deposit Insurance Corporation.
Some obligations issued or guaranteed by agencies or instrumentalities of the
U.S. government, such as Government National Mortgage Association participation
certificates, are backed by the full faith and credit of the U.S. Treasury. No
assurances can be given that the U.S. government will provide financial support
to other agencies or instrumentalities, since it is not obligated to do so.
These instrumentalities are supported by:
. the issuer's right to borrow an amount limited to a specific line of
credit from the U.S. Treasury;
. discretionary authority of the U.S. government to purchase certain
obligations of an agency or instrumentality; or
. the credit of the agency or instrumentality.
INSTRUMENTS OF BANKS AND SAVINGS AND LOAN ASSOCIATIONS. The short-term
instruments of banks and savings and loan associations which the Trust can
purchase will comprise no more than 20% of the Trust's total assets. These
instruments may be less marketable than other instruments purchased by the
Trust.
REPURCHASE AGREEMENTS. The U.S. government securities in which the Trust
invests may be purchased pursuant to repurchase agreements. Repurchase
agreements are arrangements in which banks, broker/dealers, and other
recognized financial institutions sell U.S. government or other securities
to the Trust and agree at the time of sale to repurchase them at a mutually
agreed upon time and price.
As a matter of investment practice which can be changed without shareholder
approval, the Trust will not invest more than 10% of its net assets in
securities which are illiquid, including repurchase agreements providing
for settlement in more than seven days after notice.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS. The Trust may purchase
short-term U.S. government obligations on a when-issued or delayed delivery
basis. In when-issued and delayed delivery transactions, the Trust relies on the
seller to complete the transaction. The seller's failure to complete the
transaction may cause the Trust to miss a price or yield considered to be
advantageous.
INVESTMENT LIMITATIONS
The Trust will not borrow money or pledge securities except, under certain
circumstances, the Trust may borrow up to one-third of the value of its total
assets and pledge up to 10% of the value of those assets to secure such
borrowings.
REGULATORY COMPLIANCE
The Trust may follow non-fundamental operational policies that are more
restrictive than its fundamental investment limitations, as set forth in this
prospectus and its Statement of Additional Information, in order to comply with
applicable laws and regulations, including the provisions of and regulations
under the Investment Company Act of 1940, as amended. In particular, the Trust
will comply with the various requirements of Rule 2a-7, which regulates money
market mutual funds. The Trust will determine the effective maturity of its
investments, according to Rule 2a-7. The Trust may change these operational
policies to reflect changes in the laws and regulations without the approval of
its shareholders.
NET ASSET VALUE
- --------------------------------------------------------------------------------
The Trust attempts to stabilize the net asset value of Shares at $1.00 by
valuing the portfolio securities using the amortized cost method. The net asset
value per Share is determined by subtracting total liabilities from total assets
and dividing the remainder by the number of Shares outstanding. The Trust, of
course, cannot guarantee that its net asset value will always remain at $1.00
per Share.
The net asset value is determined at 12:00 noon (Eastern time) and 4:00 p.m.
(Eastern time), Monday through Friday, except on: (i) days on which there are
not sufficient changes in the value of the Trust's portfolio securities that its
net asset value might be materially affected; (ii) days during which no Shares
are tendered for redemption and no orders to purchase Shares are received; and
(iii) the following holidays: New Year's Day, President's Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
CONVERSION OF CLASS B SHARES. Class B Shares will automatically convert into
Class A Shares on the fifteenth day of the month, eight years after the purchase
date, except as noted below, and will no longer be subject to a distribution
services fee (See "Other Classes of Shares"). Such conversion will be on the
basis of the relative net asset values per share, without the imposition of any
sales load, fee, or other charge. Class B Shares acquired by exchange from Class
B Shares of another fund in the Liberty Family of Funds will convert into Class
A Shares based on the time of the initial purchase. For purposes of conversion
to Class A Shares, Shares purchased through the reinvestment of dividends and
distributions paid on Class B Shares will be considered to be held in a separate
sub-account. Each time any Class B Shares in the shareholder's account (other
than those in the sub-account) convert to Class A Shares, an equal pro rata
portion of the Class B Shares in the sub-account will also convert to Class A
Shares. The availability of the conversion feature is subject to the granting of
an exemptive order by the Securities and Exchange Commission or the adoption of
a rule permitting such conversion. In the event that the exemptive order or rule
ultimately issued by the Securities and Exchange Commission requires any
conditions additional to those described in this prospectus, shareholders will
be notified. The conversion of Class B Shares to Class A Shares is subject to
the continuing availability of a ruling from the Internal Revenue Service or an
opinion of counsel that such conversions will not constitute taxable events for
Federal tax purposes. There can be no assurance that such ruling or opinion will
be available, and the conversion of Class B Shares to Class A Shares will not
occur if such ruling or opinion is not available. In such event, Class B Shares
would continue to be subject to higher expenses than Class A Shares for an
indefinite period.
INVESTING IN CLASS B SHARES
- --------------------------------------------------------------------------------
SHARE PURCHASES
Shares are sold on days on which the New York Stock Exchange is open. Class B
Shares may only be purchased by exchange of Class B Shares of another Liberty
Family fund. Class B Shares are exchanged at net asset value. The Trust reserves
the right to reject any exchange request.
THROUGH A FINANCIAL INSTITUTION. An investor may call his financial institution
(such as a bank or an investment dealer) to request an exchange. Reguests for
exchange through a financial institution are considered received when the Trust
is notified of the request, It is the financial institution's responsibility to
promptly submit exchange requests.
Requests for exchange made through a registered broker/dealer must be received
by the broker by 4:00 p.m. (Eastern time) and must be transmitted by the broker
to the Trust before 5:00 p.m. (Eastern time in order for Shares to be acquired
by exchange at that day's price. See "Exchange Privilege."
CERTIFICATES AND CONFIRMATIONS
As transfer agent for the Trust, Federated Services Company maintains a Share
account for each shareholder. Share certificates are not issued unless requested
in writing to Federated Services Company.
Monthly confirmations are sent to report transactions such as purchases and
redemptions as well as dividends paid during the month.
DIVIDENDS
Dividends are declared daily and paid monthly. Dividends are automatically
reinvested on payment dates in additional shares of the Trust unless cash
payments are requested by contacting Federated Services Company. Shares
purchased through an exchange will begin to earn dividends on the next business
day.
CAPITAL GAINS
Since the Trust's policy is, under normal circumstances, to hold portfolio
securities to maturity and to value portfolio securities at amortized cost, it
does not expect any capital gains or losses. If the Trust does experience gains,
however, it could result in an increase in dividends. Capital losses could
result in a decrease in dividends. If for some extraordinary reason the Trust
realizes net long-term capital gains, it will distribute them at least once
every 12 months.
RETIREMENT PLANS
Shares of the Trust can be purchased through an exchange as an investment for
retirement plans or for IRA accounts. For further details, contact the Trust and
consult a tax adviser.
EXCHANGE PRIVILEGE
- --------------------------------------------------------------------------------
In order to provide greater flexibility to Trust shareholders whose investment
objectives have changed, Class B shareholders may exchange all or some of their
Shares for Class B Shares of other funds in the Liberty Family of Funds. (Not
all funds in the Liberty Family of Funds currently offer Class B Shares. Contact
your financial institution regarding the availability of other Class B Shares in
the Liberty Family of Funds.) Exchanges are made at net asset value without
being assessed a contingent deferred sales charge on the exchanged Shares. To
the extent that a shareholder exchanges for Class B Shares in other funds in the
Liberty Family of Funds, the time for which the exchanged-for shares were held
will be added, or tacked, to the time for which the exchanged-from Shares were
held for purposes of satisfying the applicable holding period.
REQUIREMENTS FOR EXCHANGE
Shareholders using this privilege must exchange Shares having a net asset value
equal to the minimum investment requirements of the fund into which the exchange
is being made. Before the exchange, the shareholder must receive a prospectus of
the fund for which the exchange is being made.
This privilege is available to shareholders resident in any state in which the
Shares being acquired may be sold. Upon receipt of proper instructions and
required supporting documents, Shares submitted for exchange are redeemed and
the proceeds invested in Class B Shares of the other fund. The exchange
privilege may be modified or terminated at any time. Shareholders will be
notified of the modification or termination of the exchange privilege.
Further information on the exchange privilege and prospectuses for the Liberty
Family of Funds are available by contacting the Trust.
TAX CONSEQUENCES
An exercise of the exchange privilege is treated as a sale for federal income
tax purposes. Depending on the circumstances, a capital gain or loss may be
realized.
MAKING AN EXCHANGE
Instructions for exchanges for the Liberty Family of Funds may be given in
writing or by telephone. Written instructions may require a signature guarantee.
Shareholders of the Trust may have difficulty in making exchanges by telephone
through brokers and other financial institutions during times of drastic
economic or market changes. If a shareholder cannot contact his broker or
financial institution by telephone, it is recommended that an exchange request
be made in writing and sent by overnight mail to Federated Services Company, c/o
State Street Bank and Trust Company, Two Heritage Drive, North Quincy,
Massachusetts 02171.
TELEPHONE INSTRUCTIONS. Telephone instructions made by the investor may be
carried out only if a telephone authorization form completed by the investor is
on file with the Trust. Telephone exchange instructions may be recorded. If the
instructions are given by a broker, a telephone authorization form completed by
the broker must be on file with the Trust. Shares may be exchanged between two
funds by telephone only if the two funds have identical shareholder
registrations. If reasonable procedures are not followed by the Trust, it may be
liable for losses due to unauthorized or fraudulent telephone instructions.
Any shares held in certificate form cannot be exchanged by telephone but must be
forwarded to Federated Services Company--P.O. Box 8604, Boston, Massachusetts
02266-8604, and deposited to the shareholder's account before being exchanged.
Telephone instructions will be processed as of 4:00 p.m. (Eastern time) and must
be received by the Trust before that time for shares to be exchanged the same
day. Shareholders exchanging into a fund will not receive any dividend that is
payable to shareholders of record on that date. This privilege may be modified
or terminated at any time.
REDEEMING CLASS B SHARES
- --------------------------------------------------------------------------------
The Trust redeems Shares at their net asset value next determined after the
Trust receives the redemption request. Redemptions will be made on days on which
the Trust computes its net asset value. Redemptions can be made through a
financial institution or directly from the Trust. Redemption requests must be
received in proper form.
THROUGH A FINANCIAL INSTITUTION
A shareholder may redeem Shares of the Trust by calling his financial
institution (such as a bank or an investment dealer) to request the redemption.
Shares will be redeemed at the net asset value, less any applicable contingent
deferred sales charge, next determined after the Trust receives the redemption
request from the financial institution. The financial institution is responsible
for promptly submitting redemption requests and providing proper written
redemption instructions to the Trust. The financial institution may charge
customary fees and commissions for this service.
In the event of drastic economic or market changes, a shareholder may experience
difficulty in redeeming by telephone. If such a case should occur, another
method of redemption should be considered.
The financial institution which maintains investor accounts with the Trust must
do so on a fully disclosed basis unless it accounts for share ownership periods
used in calculating the contingent deferred sales charge (see "Contingent
Deferred Sales Charge"). In addition, advance payments made to financial
institutions may be subject to reclaim by the distributor for accounts
transferred to financial institutions which do not maintain investor accounts on
a fully disclosed basis and do not account for share ownership periods (see
"Other Payments to Financial Institutions").
DIRECTLY FROM THE TRUST
BY TELEPHONE. Shareholders who have not purchased through a financial
institution may redeem their Shares by telephoning the Trust. Telephone
redemption instructions may be recorded. The proceeds will be mailed to the
shareholder's address of record or wire transferred to the shareholder's account
at a domestic commercial bank that is a member of the Federal Reserve System,
normally within one business day, but in no event longer than seven days after
the request. The minimum amount for a wire transfer is $1,000. If at any time
the Trust shall determine it necessary to terminate or modify these methods of
redemption, shareholders would be promptly notified.
Authorization forms permitting the Trust to accept telephone requests must first
be completed. Authorization forms and information on these services are
available from Federated Securities Corp. If reasonable procedures are not
followed by the Trust, it may be liable for losses due to unauthorized or
fraudulent telephone instructions.
A daily dividend is paid on Shares redeemed if the redemption request is
received after 12:00 noon (Eastern time). However, the proceeds are not wired
until the following business day. Redemption requests received before 12:00 noon
(Eastern time) will be paid the same day but will not be entitled to that day's
dividend.
BY MAIL. Any shareholder may redeem Shares by sending a written request to
Federated Services Company, P.O. Box 8604, Boston, Massachusetts 02266-8604. The
written request should include the shareholder's name, the Trust name and class
designation, the account number, and the Share or dollar amount requested, and
should be signed exactly as the shares are registered. If share certificates
have been issued, they must be properly endorsed and should be sent by
registered or certified mail with the written request. Shareholders should call
the Trust for assistance in redeeming by mail.
SIGNATURES. Shareholders requesting a redemption of $50,000 or more, a
redemption of any amount to be sent to an address other than that on record with
the Trust, or a redemption payable other than to the shareholder of record must
have signatures on written redemption requests guaranteed by:
. a trust company or commercial bank whose deposits are insured by the Bank
Insurance Fund ("BIF"), which is administered by the Federal Deposit
Insurance Corporation ("FDIC");
. a member of the New York, American, Boston, Midwest, or Pacific Stock
Exchanges;
. a savings bank or savings and loan association whose deposits are insured
by the Savings Association Insurance Fund ("SAIF"), which is administered
by the FDIC; or
. any other "eligible guarantor institution," as defined in the Securities
Exchange Act of 1934.
The Trust does not accept signatures guaranteed by a notary public.
The Trust and its transfer agent have adopted standards for accepting signature
guarantees from the above institutions. The Trust may elect in the future to
limit eligible signature guarantors to institutions that are members of a
signature guarantee program. The Trust and its transfer agent reserve the right
to amend these standards at any time without notice.
Normally, a check for the proceeds is mailed within one business day, but in no
event more than seven days, after receipt of a proper written redemption
request.
CONTINGENT DEFERRED SALES CHARGE
A contingent deferred sales charge may be imposed upon redemption of Class B
Shares purchased through an exchange from another Liberty Family Fund. Upon
redemption, the applicable contingent deferred sales charge will be calculated
based on the schedule applicable to redemptions of Class B Shares of the Liberty
Family Fund originally purchased. For purposes of calculating the holding
period, the time for which Trust Shares were held will be added, or tacked, to
the time for which exchanged-from shares were held.
The contingent deferred sales charge will be deducted from the redemption
proceeds otherwise payable to the shareholder and will be retained by the
distributor. The contingent deferred sales charge will not be imposed with
respect to: (1) Shares acquired through the reinvestment of dividends or
distributions of long-term capital gains; and (2) Shares held for more than six
full years from the date of purchase. Redemptions will be processed in a manner
intended to maximize the amount of redemption which will not be subject to a
contingent deferred sales charge. In computing the amount of the applicable
contingent deferred sales charge, redemptions are deemed to have occurred in the
following order: (1) Shares acquired through the reinvestment of dividends and
long-term capital gains; (2) Shares held for more than six full years from the
date of purchase; (3) Shares held for fewer than six years on a first-in,
first-out basis. A contingent deferred sales charge is not assessed in
connection with an exchange of Fund Shares for shares of other Class B Shares of
funds in the Liberty Family of Funds (see "Exchange Privilege"). Any contingent
deferred sales charge imposed at the time the exchanged-for shares are redeemed
is calculated as if the shareholder had held the shares from the date on which
he became a shareholder of the exchanged-from shares. Moreover, the contingent
deferred sales charge will be eliminated with respect to certain redemptions
(see "Elimination of Contingent Deferred Sales Charge" below).
ELIMINATION OF CONTINGENT DEFERRED SALES CHARGE
The contingent deferred sales charge will be eliminated with respect to the
following redemptions: (1) redemptions following the death or disability, as
defined in Section 72(m)(7) of the Internal Revenue Code of 1986, of a
shareholder; (2) redemptions representing minimum required distributions from an
Individual Retirement Account or other retirement plan to a shareholder who has
attained the age of 70-1/2; and (3) involuntary redemptions by the Trust of
Shares in shareholder accounts that do not comply with the minimum balance
requirements. In addition, to the extent that the distributor does not make
advance payments to certain financial institutions for purchases made by their
clients, no contingent deferred sales charge will be imposed on redemptions of
Shares held by Trustees, employees and sales representatives of the Trust, the
distributor, or affiliates of the Trust or distributor; employees of any
financial institution that sells shares of the Trust pursuant to a sales
agreement with the distributor; and spouses and children under the age of 21 of
the aforementioned persons. Finally, no contingent deferred sales charge will be
imposed on the redemption of Shares originally purchased through a bank trust
department, an investment adviser registered under the Investment Advisers Act
of 1940, as amended, or retirement plans where the third party administrator has
entered into certain arrangements with Federated Securities Corp. or its
affiliates, or any other financial institution, to the extent that no payments
were advanced for purchases made through or by such entities. The Trustees
reserve the right to discontinue elimination of the contingent deferred sales
charge. Shareholders will be notified of such elimination. Any Shares purchased
prior to the termination of such waiver would have the contingent deferred sales
charge eliminated as provided in the Trust's prospectus at the time of the
purchase of the Shares. If a shareholder making a redemption qualifies for an
elimination of the contingent deferred sales charge, the shareholder must notify
Federated Securities Corp. or the transfer agent in writing that he is entitled
to such elimination.
SYSTEMATIC WITHDRAWAL PROGRAM
If a shareholder's account has a value of at least $10,000, a Systematic
Withdrawal Program may be established whereby automatic redemptions are made
from the account and transferred electronically to any commercial bank, savings
bank, or credit union that is an Automated Clearing House (ACH) member. A
shareholder may apply for participation in this program through his financial
institution.
ACCOUNTS WITH LOW BALANCES
Due to the high cost of maintaining accounts with low balances, the Trust may
redeem Shares in any account, except retirement plans, and pay the proceeds to
the shareholder if the account balance falls below the required minimum value of
$500 due to shareholder redemptions. Before Shares are redeemed to close an
account, the shareholder is notified in writing and allowed 30 days to purchase
additional Shares to meet the minimum requirement.
TRUST INFORMATION
- --------------------------------------------------------------------------------
MANAGEMENT OF THE TRUST
BOARD OF TRUSTEES. The Trust is managed by a Board of Trustees (the
"Trustees"). The Trustees are responsible for managing the Trust's business
affairs and for exercising all the Trust's powers except those reserved for the
shareholders. An Executive Committee of the Board of Trustees handles the
Board's responsibilities between meetings of the Board.
OFFICERS AND TRUSTEES. Officers and Trustees are listed with their addresses,
present positions with Liberty U.S. Government Money Market Trust, and principal
occupations, including those with Federated Advisers, its affiliates, and the
"Funds" described in the Statement of Additional Information.
- --------------------------------------------------------------------------------
John F. Donahue+*
Federated Investors Tower
Pittsburgh, PA
Chairman and Trustee
Chairman and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; Chairman and Director, Federated Research
Corp.; Chairman, Passport Research, Ltd.; Director, AEtna Life and Casualty
Company; Chief Executive Officer and Director, Trustee, or Managing General
Partner of the Funds. Mr. Donahue is the father of J. Christopher Donahue,
President of the Trust.
- --------------------------------------------------------------------------------
John T. Conroy, Jr.
Wood/IPC Commercial Department
John R. Wood and Associates, Inc., Realtors
3255 Tamiami Trail North
Naples, FL
Trustee
President, Investment Properties Corporation; Senior Vice-President, John R.
Wood and Associates, Inc., Realtors; President, Northgate Village Development
Corporation; Partner or Trustee in private real estate ventures in Southwest
Florida; Director, Trustee, or Managing General Partner of the Funds; formerly,
President, Naples Property Management, Inc.
- --------------------------------------------------------------------------------
William J. Copeland
One PNC Plaza--23rd Floor
Pittsburgh, PA
Trustee
Director and Member of the Executive Committee, Michael Baker, Inc.; Director,
Trustee, or Managing General Partner of the Funds; formerly, Vice Chairman and
Director, PNC Bank, N.A., and PNC Bank Corp. and Director, Ryan Homes, Inc.
- --------------------------------------------------------------------------------
James E. Dowd
571 Hayward Mill Road
Concord, MA
Trustee
Attorney-at-law; Director, The Emerging Germany Fund, Inc.; Director, Trustee,
or Managing General Partner of the Funds; formerly, Director, Blue Cross of
Massachusetts, Inc.
- --------------------------------------------------------------------------------
Lawrence D. Ellis, M.D.
3471 Fifth Avenue, Suite 1111
Pittsburgh, PA
Trustee
Hematologist, Oncologist, and Internist, Presbyterian and Montefiore Hospitals;
Professor of Medicine and Trustee, University of Pittsburgh; Director of
Corporate Health, University of Pittsburgh Medical Center; Director, Trustee, or
Managing General Partner of the Funds.
- --------------------------------------------------------------------------------
Edward L. Flaherty, Jr.+
5916 Penn Mall
Pittsburgh, PA
Trustee
Attorney-at-law; Partner, Meyer and Flaherty; Director, Eat'N Park Restaurants,
Inc., and Statewide Settlement Agency, Inc.; Director, Trustee, or Managing
General Partner of the Funds; formerly, Counsel, Horizon Financial, F.A.,
Western Region.
- --------------------------------------------------------------------------------
Edward C. Gonzales*
Federated Investors Tower
Pittsburgh, PA
Vice President and Treasurer and Trustee
Vice President, Treasurer, and Trustee, Federated Investors; Vice President and
Treasurer, Federated Advisers, Federated Management, Federated Research,
Federated Research Corp., and Passport Research, Ltd.; Executive Vice President,
Treasurer, and Director, Federated Securities Corp.; Trustee, Federated Services
Company and Federated Shareholder Services; Chairman, Treasurer, and Trustee,
Federated Administrative Services; Trustee or Director of some of the Funds;
Vice President and Treasurer of the Funds.
- --------------------------------------------------------------------------------
Peter E. Madden
225 Franklin Street
Boston, MA
Trustee
Consultant; State Representative, Commonwealth of Massachusetts; Director,
Trustee, or Managing General Partner of the Funds; formerly, President, State
Street Bank and Trust Company and State Street Boston Corporation and Trustee,
Lahey Clinic Foundation, Inc.
- --------------------------------------------------------------------------------
Gregor F. Meyer
5916 Penn Mall
Pittsburgh, PA
Trustee
Attorney-at-law; Partner, Meyer and Flaherty; Chairman, Meritcare, Inc.;
Director, Eat'N Park Restaurants, Inc.; Director, Trustee, or Managing General
Partner of the Funds; formerly, Vice Chairman, Horizon Financial, F.A.
- --------------------------------------------------------------------------------
Wesley W. Posvar
1202 Cathedral of Learning
University of Pittsburgh
Pittsburgh, PA
Trustee
Professor, Foreign Policy and Management Consultant; Trustee, Carnegie Endowment
for International Peace, RAND Corporation, Online Computer Library Center, Inc.,
and U.S. Space Foundation; Chairman, Czecho Slovak Management Center; Director,
Trustee, or Managing General Partner of the Funds; President Emeritus,
University of Pittsburgh; formerly, Chairman, National Advisory Council for
Environmental Policy and Technology.
- --------------------------------------------------------------------------------
Marjorie P. Smuts
4905 Bayard Street
Pittsburgh, PA
Trustee
Public relations/marketing consultant; Director, Trustee, or Managing General
Partner of the Funds.
- --------------------------------------------------------------------------------
J. Christopher Donahue
Federated Investors Tower
Pittsburgh, PA
President
President and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; President and Director, Federated Research
Corp.; President, Passport Research, Ltd.; Trustee, Federated Administrative
Services, Federated Services Company, and Federated Shareholder Services;
President or Vice President of the Funds; Director, Trustee, or Managing General
Partner of some of the Funds. Mr. Donahue is the son of John F. Donahue,
Chairman and Trustee of the Trust.
- --------------------------------------------------------------------------------
Richard B. Fisher
Federated Investors Tower
Pittsburgh, PA
Vice President
Executive Vice President and Trustee, Federated Investors; Director, Federated
Research Corp.; Chairman and Director, Federated Securities Corp.; President or
Vice President of some of the Funds; Director or Trustee of some of the Funds.
- --------------------------------------------------------------------------------
John W. McGonigle
Federated Investors Tower
Pittsburgh, PA
Vice President and Secretary
Vice President, Secretary, General Counsel, and Trustee, Federated Investors;
Vice President, Secretary, and Trustee, Federated Advisers, Federated
Management, and Federated Research; Vice President and Secretary, Federated
Research Corp. and Passport Research, Ltd.; Trustee, Federated Services Company;
Executive Vice President, Secretary, and Trustee, Federated Administrative
Services; Secretary and Trustee, Federated Shareholder Services; Executive Vice
President and Director, Federated Securities Corp.; Vice President and Secretary
of the Funds.
- --------------------------------------------------------------------------------
*This Trustee is deemed to be an "interested person" as defined in the
Investment Company Act of 1940, as amended.
+Members of the Executive Committee. The Executive Committee of the Board of
Trustees handles the responsibilities of the Board of Trustees between meetings
of the Board.
TRUST OWNERSHIP. Officers and Trustees own less than 1% of the Trust's
outstanding shares.
TRUSTEE LIABILITY. The Trust's Declaration of Trust provides that the Trustees
will not be liable for errors of judgment or mistakes of fact or law. However,
they are not protected against any liability to which they would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the conduct of their office.
INVESTMENT ADVISER. Investment decisions for the Trust are made by Federated
Advisers (the "Adviser"), the Trust's investment adviser, subject to direction
by the Trustees. The Adviser continually conducts investment research and
supervision for the Trust and is responsible for the purchase or sale of
portfolio instruments, for which it receives an annual fee from the Trust.
ADVISORY FEES. The annual investment advisory fee is based on the Trust's
average daily net assets as shown in the chart below:
<TABLE>
<CAPTION>
ADVISORY FEE AS
% OF AVERAGE
AVERAGE DAILY NET ASSETS DAILY NET ASSETS
<S> <C>
First $500 million .50 of 1%
Second $500 million .475 of 1%
Third $500 million .45 of 1%
Fourth $500 million .425 of 1%
Over $2 billion .40 of 1%
</TABLE>
The Adviser has undertaken to reimburse the Trust for operating expenses in
excess of limitations established by certain states.
ADVISER'S BACKGROUND. Federated Advisers, a Delaware business trust
organized on April 11, 1989, is a registered investment adviser under the
Investment Advisers Act of 1940. It is a
subsidiary of Federated Investors. All of the Class A (voting) shares of
Federated Investors are owned by a trust, the trustees of which are John F.
Donahue, Chairman and Trustee of Federated Investors, Mr. Donahue's wife,
and Mr. Donahue's son, J. Christopher Donahue, who is President and Trustee
of Federated Investors.
Federated Advisers and other subsidiaries of Federated Investors serve as
investment advisers to a number of investment companies and private
accounts. Certain other subsidiaries also provide administrative services
to a number of investment companies. Total assets under management or
administration by these and other subsidiaries of Federated Investors are
approximately $70 billion. Federated Investors, which was founded in 1956
as Federated Investors, Inc., develops and manages mutual funds primarily
for the financial industry. Federated Investors' track record of
competitive performance and its disciplined, risk averse investment
philosophy serve approximately 3,500 client institutions nationwide.
Through these same client institutions, individual shareholders also have
access to this same level of investment expertise.
DISTRIBUTION OF CLASS B SHARES
Federated Securities Corp. is the principal distributor for Shares of the Trust.
Federated Securities Corp. is located at Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779. It is a Pennsylvania corporation organized on November
14, 1969, and is the principal distributor for a number of investment companies.
Federated Securities Corp. is a subsidiary of Federated Investors.
DISTRIBUTION AND SHAREHOLDER SERVICES PLANS. Under a distribution plan adopted
in accordance with Investment Company Act Rule 12b-1 (the "Distribution Plan"),
Class B Shares will pay to the distributor an amount computed at an annual rate
of 0.75% of the average daily net assets of Class B Shares to finance any
activity which is principally intended to result in the sale of Class B Shares
subject to the Distribution Plan.
Because distribution fees to be paid by the Trust to the distributor may not
exceed an annual rate of 0.75% of the Class B Shares' average daily net assets,
it will take the distributor a number of years to recoup the expenses it has
incurred for its distribution and distribution-related services pursuant to the
Plan.
The Distribution Plan is a compensation type plan. As such, the Trust makes no
payments to the distributor except as described above. Therefore, the Trust does
not pay for unreimbursed expenses of the distributor, including amounts expended
by the distributor in excess of amounts received by it from the Trust, interest,
carrying or other financing charges in connection with excess amounts expended,
or the distributor's overhead expenses. However, the distributor may be able to
recover such amounts or may earn a profit from future payments made by Shares
under the Plan.
In addition, the Trust has adopted a Shareholder Services Plan (the "Services
Plan") under which it may make payments up to 0.25 of 1% of the average daily
net asset value of Class B Shares to obtain certain personal services for
shareholders and the maintenance of shareholder accounts ("shareholder
services"). The Trust has entered into a Shareholder Services Agreement with
Federated Shareholder Services, a subsidiary of Federated Investors, under which
Federated Shareholder Services will either perform shareholder services directly
or will select financial institutions to perform shareholder services. Financial
institutions will receive fees based upon shares owned by their clients or
customers.
The schedules of such fees and the basis upon which such fees will be paid will
be determined from time to time by the Trust and Federated Shareholder Services.
The Glass-Steagall Act prohibits a depository institution (such as a commercial
bank or savings and loan association) from being an underwriter or distributor
of most securities. In the event the Glass-Steagall Act is deemed to prohibit
depository institutions from acting in the capacities described above or should
Congress relax current restrictions on depository institutions, the Trustees
will consider appropriate changes in the services.
State securities laws governing the ability of depository institutions to act as
underwriters or distributors of securities may differ from interpretations given
to the Glass-Steagall Act and, therefore, banks and financial institutions may
be required to register as dealers pursuant to state law.
ADMINISTRATION OF THE TRUST
ADMINISTRATIVE SERVICES. Federated Administrative Services, a subsidiary of
Federated Investors, provides administrative personnel and services (including
certain legal and financial reporting services) necessary to operate the Trust.
Federated Administrative Services provides these at an annual rate which relates
to the average aggregate daily net assets of all the Federated Funds as
specified below:
<TABLE>
<CAPTION>
AVERAGE AGGREGATE DAILY NET ASSETS
MAXIMUM ADMINISTRATIVE FEE OF THE FEDERATED FUNDS
<S> <C>
0.15 of 1% on the first $250 million
0.125 of 1% on the next $250 million
0.10 of 1% on the next $250 million
0.075 of 1% on assets in excess of $750 million
</TABLE>
The administrative fee received during any fiscal year shall be at least
$125,000 per portfolio and $30,000 per each additional class of shares.
Federated Administrative Services may choose voluntarily to waive a portion of
its fee.
CUSTODIAN. State Street Bank and Trust Company, P.O. Box 8604, Boston,
Massachusetts 02266-8604, is custodian for the securities and cash of the Trust.
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT. Federated Services Company, P.O.
Box 8604, Boston, Massachusetts 02266-8604 is transfer agent for the shares of
the Trust and dividend disbursing agent for the Trust.
LEGAL COUNSEL. Legal counsel is provided by Houston, Houston & Donnelly, 2510
Centre City Tower, Pittsburgh, Pennsylvania 15222, and Dickstein, Shapiro &
Morin, L.L.P., 2101 L Street, N.W., Washington, D.C. 20037.
INDEPENDENT PUBLIC ACCOUNTANTS. The independent public accountants for the
Trust are Arthur Andersen LLP, 2100 One PPG Place, Pittsburgh, Pennsylvania
15222.
EXPENSES OF THE TRUST AND CLASS B SHARES
Holders of Shares pay their allocable portion of Trust and portfolio expenses.
The Trust expenses for which holders of Shares pay their allocable portion
include, but are not limited to: the cost of organizing the Trust and continuing
its existence; registering the Trust with federal and state securities
authorities; Trustees' fees; auditors' fees; the cost of meetings of Trustees;
legal fees of the Trust; association membership dues; and such non-recurring and
extraordinary items as may arise from time to time.
The portfolio expenses for which holders of Shares pay their allocable portion
include, but are not limited to: registering the portfolio and Shares of the
portfolio; investment advisory services; taxes and commissions; custodian fees;
insurance premiums; auditors' fees; and such non-recurring and extraordinary
items as may arise from time to time.
At present, the only expenses which are allocated specifically to Shares as a
class are expenses under the Trust's Shareholder Services Plan and Distribution
Plan. However, the Trustees reserve the right to allocate certain other expenses
to holders of Shares as they deem appropriate ("Class Expenses"). In any case,
Class Expenses would be limited to: distribution fees; transfer agent fees as
identified by the transfer agent as attributable to holders of Shares; fees
under the Trust's Shareholder Services Plan; printing and postage expenses
related to preparing and distributing materials such as shareholder reports,
prospectuses and proxies to current shareholders; registration fees paid to the
Securities and Exchange Commission and to state securities commissions; expenses
related to administrative personnel and services as required to support holders
of Shares; legal fees relating solely to Shares; and Trustees' fees incurred as
a result of issues relating solely to Shares.
SHAREHOLDER INFORMATION
- --------------------------------------------------------------------------------
VOTING RIGHTS
Each Share gives the shareholder one vote in Trustee elections and other matters
submitted to shareholders for vote. All shares of each portfolio or class in the
Trust have equal voting rights, except that in matters affecting only a
particular portfolio or class, only shares of that portfolio or class are
entitled to vote. As a Massachusetts business trust, the Trust is not required
to hold annual shareholder meetings. Shareholder approval will be sought only
for certain changes in the Trust's operation and for the election of Trustees
under certain circumstances.
Trustees may be removed by the Trustees or by shareholders at a special meeting.
A special meeting of the Trust shall be called by the Trustees upon the written
request of shareholders owning at least 10% of the Trust's outstanding shares.
MASSACHUSETTS PARTNERSHIP LAW
Under certain circumstances, shareholders may be held personally liable as
partners under Massachusetts law for obligations of the Trust. To protect its
shareholders, the Trust has filed legal documents with Massachusetts that
expressly disclaim the liability of its shareholders for acts or obligations of
the Trust. These documents require notice of this disclaimer to be given in each
agreement, obligation, or instrument the Trust or its Trustees enter into or
sign.
In the unlikely event a shareholder is held personally liable for the Trust's
obligations, the Trust is required to use its property to protect or compensate
the shareholder. On request, the Trust will defend any claim made and pay any
judgment against a shareholder for any act or obligation of the Trust.
Therefore, financial loss resulting from liability as a shareholder will occur
only if the Trust itself cannot meet its obligations to indemnify shareholders
and pay judgments against them.
TAX INFORMATION
- --------------------------------------------------------------------------------
FEDERAL INCOME TAX
The Trust will pay no federal income tax because it expects to meet requirements
of the Internal Revenue Code applicable to regulated investment companies and to
receive the special tax treatment afforded to such companies.
Unless otherwise exempt, shareholders are required to pay federal income tax on
any dividends and other distributions received. This applies whether dividends
and distributions are received in cash or as additional Shares. No federal
income tax is due on any dividends earned in an IRA or qualified retirement plan
until distributed.
PENNSYLVANIA CORPORATE AND PERSONAL PROPERTY TAXES
In the opinion of Houston, Houston & Donnelly, counsel to the Trust:
. the Trust is not subject to the Pennsylvania corporate or personal
property taxes; and
. Shares may be subject to personal property taxes imposed by counties,
municipalities, and school districts in Pennsylvania to the extent that
the portfolio securities in the Trust would be subject to such taxes if
owned directly by residents of those jurisdictions.
Shareholders are urged to consult their own tax advisers regarding the status of
their accounts under state and local tax laws.
PERFORMANCE INFORMATION
- --------------------------------------------------------------------------------
From time to time, the Trust advertises its yield and effective yield for Class
B Shares.
The yield of Class B Shares represents the annualized rate of income earned on
an investment in Class B Shares over a seven-day period. It is the annualized
dividends earned during the period on the investment, shown as a percentage of
the investment. The effective yield is calculated similarly to the yield, but,
when annualized, the income earned by an investment in Class B Shares is assumed
to be reinvested daily. The effective yield will be slightly higher than the
yield because of the compounding effect of this assumed reinvestment.
Advertisements and other sales literature may also refer to total return. Total
return represents the change, over a specified period of time, in the value of
an investment in Class B Shares after reinvesting all income distributions. It
is calculated by dividing that change by the initial investment and is expressed
as a percentage.
Yield and effective yield will be calculated separately for Class A Shares and
Class B Shares. Because Class B Shares are subject to Rule 12b-1 fees, the yield
and effective yield for Class A Shares, for the same period, may exceed that of
Class B Shares. Depending on the dollar amount invested, and the time period for
which any particular class of shares is held, the total return for any
particular class may exceed that of another.
From time to time, the Trust may advertise its performance for Class A Shares
and Class B Shares using certain financial publications and/or compare the
performance of Class A Shares and Class B Shares to certain indices.
OTHER CLASSES OF SHARES
- --------------------------------------------------------------------------------
The Trust presently offers Class A Shares and Class B Shares.
Class A Shares are sold at net asset value to financial institutions which have
a sales agreement with the Trust, or directly by the distributor. Class A Shares
may be subject to a contingent deferred sales charge of up to .50 of 1% of Class
A Shares' net asset value, but are not distributed pursuant to a 12b-1 Plan, and
therefore are not subject to a distribution services fee. Class A Shares are
subject to a minimum initial investment of $500 unless the investment is in a
retirement plan, in which case the minimum initial investment is $50.
The amount of dividends payable to Class A Shares may generally exceed that of
Class B Shares by the difference between Class Expenses and distribution
services expenses borne by Class B Shares. The stated advisory fee is the same
for both classes of shares.
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
FINANCIAL HIGHLIGHTS
CLASS A SHARES
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
The following table has been audited by Arthur Andersen LLP, the Trust's
independent public accountants. Their report dated May 13, 1994 on the Trust's
financial statements for the year ended March 31, 1994, and on the following
table for each of the ten years in the period ended March 31, 1994 is included
in the Annual Report dated March 31, 1994, which is incorporated by reference.
Class B Shares were not being offered as of March 31, 1994. The financial
highlights presented below are historical information for Class A Shares.
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
NET ASSET VALUE,
BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- --------------------
INCOME FROM
INVESTMENT
OPERATIONS
- --------------------
Net investment
income 0.02 0.03 0.05 0.07 0.08 0.07 0.06 0.05 0.07 0.09
- -------------------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
LESS DISTRIBUTIONS
- --------------------
Dividends to
shareholders from
net investment
income (0.02) (0.03) (0.05) (0.07) (0.08) (0.07) (0.06) (0.05) (0.07) (0.09)
- -------------------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
NET ASSET VALUE, END
OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- -------------------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
TOTAL RETURN* 2.34% 2.71% 4.66% 7.11% 8.24% 7.44% 6.07% 5.48% 7.16% 9.50%
- --------------------
RATIOS TO AVERAGE
NET ASSETS
- --------------------
Expenses 1.01% 1.04% 1.03% 1.01% 1.02% 1.01% 1.01% 1.01% 0.98% 0.88%
- --------------------
Net investment
income 2.31% 2.69% 4.59% 6.89% 7.94% 7.19% 5.90% 5.39% 6.95% 9.11%
- --------------------
SUPPLEMENTAL DATA
- --------------------
Net assets, end of
period (000
omitted) $805,907 $919,883 $1,173,685 $1,393,380 $1,443,347 $1,386,704 $1,358,694 $1,467,182 $2,069,333 $2,989,596
- --------------------
</TABLE>
* Based on net asset value which does not include the sales load or contingent
deferred sales charge, if applicable.
Further information about the Trust's performance is contained in the Trust's
Annual Report, dated March 31, 1994, which can be obtained free of charge.
LIBERTY U.S. GOVERNMENT
MONEY MARKET TRUST
CLASS B SHARES
PROSPECTUS
An Open-End, Diversified
Management Investment Company
Prospectus dated December , 1994
[LOGO] FEDERATED SECURITIES CORP.
---------------------------------------------------
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
8062809A (9/94)
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
CLASS A SHARES
CLASS B SHARES
COMBINED STATEMENT OF ADDITIONAL INFORMATION
This Combined Statement of Additional Information should be read with
the respective prospectuses of Class A Shares and Class B Shares of
Liberty U.S. Government Money Market Trust (the "Trust") dated May 31,
1994 and December , 1994, respectively. This Statement is not a
prospectus itself. To receive a copy of the prospectus for any class,
write or call the Trust.
LIBERTY CENTER
FEDERATED INVESTORS TOWER
PITTSBURGH, PENNSYLVANIA 15222-3779
Statement dated December , 1994
[LOGO] FEDERATED SECURITIES CORP.
---------------------------------------------------------
Distributor
A subsidiary of FEDERATED INVESTORS
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
GENERAL INFORMATION ABOUT THE TRUST 1
- ---------------------------------------------------------------
INVESTMENT OBJECTIVE AND POLICIES 1
- ---------------------------------------------------------------
Types of Investments 1
When-Issued and Delayed Delivery
Transactions 1
Repurchase Agreements 1
Investment Limitations 1
THE FUNDS 2
- ---------------------------------------------------------------
INVESTMENT ADVISORY SERVICES 3
- ---------------------------------------------------------------
Adviser to the Trust 3
Advisory Fees 3
ADMINISTRATIVE SERVICES 3
- ---------------------------------------------------------------
BROKERAGE TRANSACTIONS 3
- ---------------------------------------------------------------
PURCHASING SHARES 4
- ---------------------------------------------------------------
Distribution of Shares 4
Distribution Plan (Class B Shares Only)
and Shareholder Services Plan 4
Conversion to Federal Funds 4
DETERMINING NET ASSET VALUE 4
- ---------------------------------------------------------------
Use of the Amortized Cost Method 5
REDEEMING SHARES 5
- ---------------------------------------------------------------
Redemption in Kind 6
TAX STATUS 6
- ---------------------------------------------------------------
The Trust's Tax Status 6
Shareholders' Tax Status 6
YIELD 6
- ---------------------------------------------------------------
EFFECTIVE YIELD 6
- ---------------------------------------------------------------
PERFORMANCE COMPARISONS 7
- ---------------------------------------------------------------
FINANCIAL STATEMENTS 7
- ---------------------------------------------------------------
GENERAL INFORMATION ABOUT THE TRUST
- --------------------------------------------------------------------------------
Liberty U.S. Government Money Market Trust (the "Trust") was established as a
Massachusetts business trust under a Declaration of Trust dated August 30, 1979.
The name of the Trust was AARP U.S. Government Money Market Trust prior to April
16, 1985.
On ,1994, the shareholders of the Trust voted to permit the Trust to offer
separate series and classes of Shares. Shares of the Trust are offered in two
classes, known as Class A Shares and Class B Shares (individually and
collectively referred to as "Shares" as the context may require.) This Combined
Statement of Additional Information relates to both classes of Shares.
INVESTMENT OBJECTIVE AND POLICIES
- --------------------------------------------------------------------------------
The Trust's investment objective is stability of principal and current income
consistent with stability of principal.
TYPES OF INVESTMENTS
The Trust invests in short-term U.S. government securities. The investment
policies and the objective stated above cannot be changed without approval of
shareholders.
VARIABLE RATE U.S. GOVERNMENT SECURITIES
Some of the short-term U.S. government securities the Trust may purchase
carry variable interest rates. These securities have a rate of interest
subject to adjustment at least annually. This adjusted interest rate is
ordinarily tied to some objective standard, such as the 91-day U.S.
Treasury bill rate.
Variable interest rates will reduce the changes in the market value of
such securities from their original purchase prices. Accordingly, the
potential for capital appreciation or capital depreciation should not be
greater than the potential for capital appreciation or capital
depreciation of fixed interest rate U.S. government securities having
maturities equal to the interest rate adjustment dates of the variable
rate U.S. government securities.
The Trust may purchase variable rate U.S. government securities upon the
determination by the Board of Trustees that the interest rate as adjusted
will cause the instrument to have a current market value that
approximates its par value on the adjustment date.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS
These transactions are arrangements in which the Trust purchases securities with
payment and delivery scheduled for a future time. The Trust engages in
when-issued and delayed transactions only for the purpose of acquiring portfolio
securities consistent with the Trust's investment objective and policies, not
for investment leverage.
These transactions are made to secure what is considered to be an advantageous
price and yield for the Trust. Settlement dates may be a month or more after
entering into these transactions, and the market values of the securities
purchased may vary from the purchase prices.
No fees or expenses, other than normal transaction costs, are incurred. However,
liquid assets of the Trust sufficient to make payment for the securities to be
purchased are segregated at the trade date. These securities are marked to
market daily and maintained until the transaction is settled.
REPURCHASE AGREEMENTS
The Trust or its custodian will take possession of the securities subject to
repurchase agreements, and these securities will be marked to market daily. To
the extent that the original seller does not repurchase the securities from the
Trust, the Trust could receive less than the repurchase price on any sale of
such securities. In the event that such a defaulting seller filed for bankruptcy
or became insolvent, disposition of such securities by the Trust might be
delayed pending court action. The Trust believes that under the regular
procedures normally in effect for custody of the Trust's portfolio securities
subject to repurchase agreements, a court of competent jurisdiction would rule
in favor of the Trust and allow retention or disposition of such securities. The
Trust will only enter into repurchase agreements with banks and other recognized
financial institutions, such as broker/dealers, which are deemed by the Trust's
adviser to be creditworthy pursuant to guidelines established by the Trustees.
INVESTMENT LIMITATIONS
The Trust will not change any of the investment limitations described below
without approval of shareholders.
SELLING SHORT AND BUYING ON MARGIN
The Trust will not sell any portfolio instruments short or purchase any
portfolio instruments on margin but may obtain such short-term credits as
may be necessary for clearance of purchases and sales of portfolio
instruments.
BORROWING MONEY
The Trust will not borrow money except as a temporary measure for
extraordinary or emergency purposes and then only in amounts not in
excess of 5% of the value of its total assets or in an amount up to
one-third of the value of its total assets, including the amount
borrowed, in order to meet redemption requests without immediately
selling portfolio instruments. This provision is not for investment
leverage but solely to facilitate management of the portfolio by enabling
the Trust to meet redemption requests when the liquidation of portfolio
instruments would be inconvenient or disadvantageous.
Interest paid on borrowed funds will not be available for investment. The
Trust will liquidate any such borrowings as soon as possible and may not
purchase any portfolio instruments while any borrowings are outstanding.
PLEDGING ASSETS
The Trust will not mortgage, pledge, or hypothecate its assets except to
secure permitted borrowings. In those cases, it may mortgage, pledge, or
hypothecate assets having a market value not exceeding the lesser of the
dollar amounts borrowed or 10% of the value of total assets at the time
of the borrowing.
LENDING CASH OR SECURITIES
The Trust will not lend any of its assets, except that it may purchase or
hold U.S. government obligations, including repurchase agreements,
permitted by its investment objective and policies.
ISSUING SENIOR SECURITIES
The Trust will not issue senior securities, except as permitted by its
investment objective and policies.
Except with respect to borrowing money, if a percentage limitation is adhered to
at the time of investment, a later increase or decrease in percentage resulting
from any change in value or net assets will not result in a violation of such
restriction.
The Trust did not borrow money or pledge assets in excess of 5% of the value of
its net assets during the last fiscal year and has no present intent to do so in
the coming fiscal year.
THE FUNDS
- --------------------------------------------------------------------------------
"The Funds" and "Funds" mean the following investment companies: American
Leaders Fund, Inc.; Annuity Management Series; Automated Cash Management Trust;
Automated Government Money Trust; California Municipal Cash Trust; Cash Trust
Series II; Cash Trust Series, Inc.; DG Investor Series; Edward D. Jones & Co.
Daily Passport Cash Trust; Federated ARMs Fund; Federated Exchange Fund, Ltd.;
Federated GNMA Trust; Federated Government Trust; Federated Growth Trust;
Federated High Yield Trust; Federated Income Securities Trust; Federated Income
Trust; Federated Index Trust; Federated Institutional Trust; Federated
Intermediate Government Trust; Federated Master Trust; Federated Municipal
Trust; Federated Short-Intermediate Government Trust; Federated Short-Term U.S.
Government Trust; Federated Stock Trust; Federated Tax-Free Trust; Federated
U.S. Government Bond Fund; First Priority Funds; Fixed Income Securities, Inc.;
Fortress Adjustable Rate U.S. Government Fund, Inc.; Fortress Municipal Income
Fund, Inc.; Fortress Utility Fund, Inc.; Fund for U.S. Government Securities,
Inc.; Government Income Securities, Inc.; High Yield Cash Trust; Insight
Institutional Series, Inc.; Insurance Management Series; Intermediate Municipal
Trust; International Series, Inc.; Investment Series Funds, Inc.; Investment
Series Trust; Liberty Equity Income Fund, Inc.; Liberty High Income Bond Fund,
Inc.; Liberty Municipal Securities Fund, Inc.; Liberty U.S. Government Money
Market Trust; Liberty Term Trust, Inc.-1999; Liberty Utility Fund, Inc.; Liquid
Cash Trust; Managed Series Trust; Mark Twain Funds; The Medalist Funds; Money
Market Management, Inc.; Money Market Obligations Trust; Money Market Trust;
Municipal Securities Income Trust; New York Municipal Cash Trust; 111 Corcoran
Funds; Peachtree Funds; The Planters Funds; Portage Funds; RIMCO Monument Funds;
The Shawmut Funds; Short-Term Municipal Trust; Star Funds; The Starburst Funds;
The Starburst Funds II; Stock and Bond Fund, Inc.; Sunburst Funds; Targeted
Duration Trust; Tax-Free Instruments Trust; Trademark Funds; Trust for Financial
Institutions; Trust For Government Cash Reserves; Trust for Short-Term U.S.
Government Securities; Trust for U.S. Treasury Obligations; World Investment
Series, Inc.
TRUST OWNERSHIP
As of December , 1994 there were no shareholders of record who owned 5% or
more of the outstanding Class A Shares of the Trust.
As of December , 1994, there were no shareholders of record who owned 5% or
more of the outstanding Class B Shares of the Trust.
INVESTMENT ADVISORY SERVICES
- --------------------------------------------------------------------------------
ADVISER TO THE TRUST
The Trust's investment adviser is Federated Advisers (the "Adviser"). It is a
subsidiary of Federated Investors.
All of the Class A voting securities of Federated Investors are owned by a
trust, the trustees of which are
John F. Donahue, his wife, and his son, J. Christopher Donahue.
The Adviser shall not be liable to the Trust or any shareholder for any losses
that may be sustained in the purchase, holding, or sale of any security or for
anything done or omitted by it, except acts or omissions involving willful
misfeasance, bad faith, gross negligence, or reckless disregard of the duties
imposed upon it by its contract with the Trust.
ADVISORY FEES
For its advisory services, the Adviser receives an annual investment advisory
fee as described in the prospectus. During the fiscal years ended March 31,
1994, 1993, and 1992, the Adviser earned $4,147,512, $5,080,154, and $6,176,806,
respectively.
STATE EXPENSE LIMITATIONS
The Adviser has undertaken to comply with the expense limitations
established by certain states for investment companies whose shares are
registered for sale in those states. If the Trust's normal operating
expenses (including the investment advisory fee, but not including
brokerage commissions, interest, taxes, and extraordinary expenses)
exceed 2-1/2% per year of the first $30 million of average net assets, 2%
per year of the next $70 million of average net assets, and 1-1/2% per
year of the remaining average net assets, the Adviser will reimburse the
Trust for its expenses over the limitation.
If the Trust's monthly projected operating expenses exceed this
limitation, the investment advisory fee paid will be reduced by the
amount of the excess, subject to an annual adjustment. If the expense
limitation is exceeded, the amount to be reimbursed by the Adviser will
be limited, in any single fiscal year, by the amount of the investment
advisory fee.
This arrangement is not part of the advisory contract and may be amended
or rescinded in the future.
ADMINISTRATIVE SERVICES
- --------------------------------------------------------------------------------
Federated Administrative Services, a subsidiary of Federated Investors, provides
administrative personnel and services to the Trust for a fee as described in the
prospectus. Prior to March 1, 1994, Federated Administrative Services, Inc.,
also a subsidiary of Federated Investors, served as the Trust's Administrator.
(For purposes of this Statement of Additional Information, Federated
Administrative Services and Federated Administrative Services, Inc. may
hereinafter collectively be referred to as the "Administrators".) For the fiscal
year ended March 31, 1994 the Administrators collectively earned $985,326. For
the fiscal years ended March 31, 1993, and 1992, Federated Administrative
Services, Inc. earned $1,103,131, and $1,321,304, respectively, none of which
was waived.
Dr. Henry J. Gailliot, an officer of Federated Advisers, the adviser to the
Trust, holds approximately 20% of the outstanding common stock and serves as
director of Commercial Data Services, Inc., a company which provides computer
processing services to Federated Administrative Services, Inc., and Federated
Administrative Services.
BROKERAGE TRANSACTIONS
- --------------------------------------------------------------------------------
When selecting brokers and dealers to handle the purchase and sale of portfolio
instruments, the Adviser looks for prompt execution of the order at a favorable
price. In working with dealers, the Adviser will generally use those who are
recognized dealers in specific portfolio instruments, except when a better price
and execution of the order can be obtained elsewhere. The Adviser makes
decisions on portfolio transactions and selects brokers and dealers subject to
review by the Board of Trustees (the "Trustees").
The Adviser may select brokers and dealers who offer brokerage and research
services. These services may be furnished directly to the Trust or to the
Adviser and may include:
. advice as to the advisability of investing in securities;
. security analysis and reports;
. economic studies;
. industry studies;
. receipt of quotations for portfolio evaluations; and
. similar services.
The Adviser and its affiliates exercise reasonable business judgment in
selecting brokers who offer brokerage and research services to execute
securities transactions. They determine in good faith that commissions charged
by such persons are reasonable in relationship to the value of the brokerage and
research services provided.
Research services provided by brokers may be used by the Adviser or by
affiliates of Federated Investors in advising Federated Funds and other
accounts. To the extent that receipt of these services may supplant services for
which the Adviser or its affiliates might otherwise have paid, it would tend to
reduce their expenses.
PURCHASING SHARES
- --------------------------------------------------------------------------------
Except under certain circumstances described in the prospectus, Shares are sold
at their net asset value without a sales charge on days the New York Stock
Exchange is open for business. Class B Shares may only be purchased by exchange
of Class B Shares of another Liberty Family Fund. The procedure for purchasing
Class A Shares and Class B Shares is explained in the respective prospectuses
under "Investing in Class A Shares" or "Investing in Class B Shares."
DISTRIBUTION OF SHARES
Federated Securities Corp. is the principal distributor for Shares of the Trust.
DISTRIBUTION PLAN (CLASS B SHARES ONLY) AND SHAREHOLDER SERVICES PLAN
These arrangements permit the payment of fees to financial institutions, the
distributor, and Federated Shareholder Services, to stimulate distribution
activities and to cause services to be provided to shareholders by a
representative who has knowledge of the shareholder's particular circumstances
and goals. These activities and services may include, but are not limited to,
marketing efforts; providing office space, equipment, telephone facilities, and
various clerical, supervisory, computer, and other personnel as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries; and assisting
clients in changing dividend options, account designations, and addresses.
With respect to the Class B Shares of the Trust, by adopting the Distribution
Plan, the Board of Trustees expects that the Trust will be able to achieve a
more predictable flow of cash for investment purposes and to meet redemptions.
This will facilitate more efficient portfolio management and assist the Trust in
pursuing its investment objectives. By identifying potential investors whose
needs are served by the Trust objectives, and properly servicing these accounts,
it may be possible to curb sharp fluctuations in rates of redemptions and sales.
Other benefits, which may be realized under either arrangement, may include: (1)
providing personal services
to shareholders; (2) investing shareholder assets with a minimum of delay and
administrative detail; (3) enhancing shareholder recordkeeping systems; and (4)
responding promptly to shareholders' requests and inquiries concerning their
accounts.
For the fiscal period ended March 31, 1994, payments in the amount of $44,736
were made pursuant to the Shareholder Services Plan, all of which was paid to
financial institutions.
CONVERSION TO FEDERAL FUNDS (CLASS A SHARES ONLY)
It is the Trust's policy to be as fully invested as possible so that maximum
interest may be earned. To this end, all payments from shareholders purchasing
Class A Shares must be in federal funds or be converted into federal funds
before shareholders begin to earn dividends. Federated Services Company acts as
the shareholder's agent in depositing checks and converting them to federal
funds.
DETERMINING NET ASSET VALUE
- --------------------------------------------------------------------------------
The Trust attempts to stabilize the value of a Share at $1.00. The days on which
net asset value is calculated by the Trust are described in the prospectus.
USE OF THE AMORTIZED COST METHOD
The Trustees have decided that the best method for determining the value of
portfolio instruments is amortized cost. Under this method, portfolio
instruments are valued at the acquisition cost as adjusted for amortization of
premium or accumulation of discount rather than at current market value.
The Trust's use of the amortized cost method of valuing portfolio instruments
depends on its compliance with applicable conditions of Rule 2a-7 (the "Rule")
promulgated by the Securities and Exchange Commission under the Investment
Company Act of 1940. Under the Rule, the Trustees must establish procedures
reasonably designed to stabilize the net asset value per Share, as computed for
purposes of distribution and redemption, at $1.00 per Share, taking into account
current market conditions and the Trust's investment objective.
Under the Rule, the Trust is permitted to purchase instruments which are subject
to demand features or standby commitments. As defined by the Rule, a demand
feature entitles the Trust to receive the principal amount of the instrument
from the issuer or a third party on (1) no more than 30 days' notice or (2) at
specified intervals not exceeding 397 days on no more than 30 days' notice. A
standby commitment entitles the Trust to achieve same day settlement and to
receive an exercise price equal to the amortized cost of the underlying
instrument plus accrued interest at the time of exercise.
MONITORING PROCEDURES
The Trustees' procedures include monitoring the relationship between the
amortized cost value per share and the net asset value per share based
upon available indications of market value. The Trustees will decide
what, if any, steps should be taken if there is a difference of more than
.5% between the two values. The Trustees will take any steps they
consider appropriate (such as redemption in kind or shortening the
average portfolio maturity) to minimize any material dilution or other
unfair results arising from differences between the two methods of
determining net asset value.
INVESTMENT RESTRICTIONS
The Rule requires that the Trust limit its investments to instruments
that, in the opinion of the Trustees, present minimal credit risk and
that, if rated, meet the minimum rating standards set forth in the Rule.
If the instruments are not rated, the Trustees must determine that they
are of comparable quality. The Rule also requires the Trust to maintain a
dollar-weighted average portfolio maturity (not more than 90 days)
appropriate to the objective of maintaining a stable net asset value of
$1.00 per Share. In addition, no instrument with a remaining maturity of
more than 397 days can be purchased by the Trust. Should the disposition
of a portfolio security result in a dollar-weighted average portfolio
maturity of more than 90 days, the Trust will invest its available cash
to reduce the average maturity to 90 days or less as soon as possible.
Shares of investment companies purchased by the Trust will meet these
same criteria and will have investment policies consistent with Rule
2a-7.
It is the Trust's usual practice to hold portfolio securities to maturity and
realize par, unless the Adviser determines that sale or other disposition is
appropriate in light of the Trust's investment objective. Under the amortized
cost method of valuation, neither the amount of daily income nor the net asset
value is affected by any unrealized appreciation or depreciation of the
portfolio.
In periods of declining interest rates, the indicated daily yield on Shares of
the Trust computed by dividing the annualized daily income on the Trust's
portfolio by the net asset value computed as above may tend to be higher than a
similar computation made by using a method of valuation based upon market prices
and estimates.
In periods of rising interest rates, the indicated daily yield on Shares of the
Trust computed the same way may tend to be lower than a similar computation made
by using a method of calculation based upon market prices and estimates.
REDEEMING SHARES
- --------------------------------------------------------------------------------
The Trust redeems Shares at the next computed net asset value after the Trust
receives the redemption request. Redemption procedures are explained in the
respective prospectuses under "Redeeming Class A Shares" and "Redeeming Class B
Shares." Although the transfer agent does not charge for telephone redemptions,
it reserves the right to charge a fee for the cost of wire-transferred
redemptions of less than $5,000.
REDEMPTION IN KIND
Although the Trust intends to redeem Shares in cash, it reserves the right under
certain circumstances to pay the redemption price in whole or in part by a
distribution of securities from the Trust's portfolio for Class A Shares or
Class B Shares.
Redemption in kind will be made in conformity with applicable Securities and
Exchange Commission rules, taking such securities at the same value employed in
determining net asset value and selecting the securities in a manner the
Trustees determine to be fair and equitable.
Redemption in kind is not as liquid as a cash redemption. If redemption is made
in kind, shareholders receiving their securities and selling them before their
maturity could receive less than the redemption value of their securities and
could incur certain transaction costs.
The Trust has elected to be governed by Rule 18f-1 of the Investment Company Act
of 1940 under which the Trust is obligated to redeem Shares for any one
shareholder in cash only up to the lesser of $250,000 or 1% of the Trust's net
asset value during any 90-day period.
TAX STATUS
- --------------------------------------------------------------------------------
THE TRUST'S TAX STATUS
The Trust will pay no federal income tax because it expects to meet the
requirements of Subchapter M of the Internal Revenue Code applicable to
regulated investment companies and to receive the special tax treatment afforded
to such companies. To qualify for this treatment, the Trust must, among other
requirements:
. derive at least 90% of its gross income from dividends, interest, and gains
from the sale of securities;
. derive less than 30% of its gross income from the sale of securities held less
than three months;
. invest in securities within certain statutory limits; and
. distribute to its shareholders at least 90% of its net income earned
during the year.
SHAREHOLDERS' TAX STATUS
Shareholders are subject to federal income tax on dividends received as cash or
additional Shares. No portion of any income dividend paid by the Trust is
eligible for the dividends received deduction available to corporations. These
dividends, and any short-term capital gains, are taxable as ordinary income.
CAPITAL GAINS
Because the Trust invests primarily for income and because it normally
holds portfolio securities to maturity, it is not expected to realize
long-term capital gains.
YIELD
- --------------------------------------------------------------------------------
The Trust's yield for Class A Shares for the seven-day period ended March 31,
1994 was 2.56%.
The Trust calculates its yield daily, based upon the seven days ending on the
day of the calculation, called the "base period." This yield is computed by:
. determining the net change in the value of a hypothetical account with a
balance of one Share at the beginning of the base period, with the net change
excluding capital changes but including the value of any additional Shares
purchased with dividends earned from the original one Share and all dividends
declared on the original and any purchased Shares;
. dividing the net change in the account's value by the value of the account at
the beginning of the base period to determine the base period return; and
. multiplying the base period return by (365/7).
To the extent that financial institutions and broker/dealers charge fees in
connection with services provided in conjunction with an investment in the
Trust, the performance will be reduced for those shareholders paying those fees.
EFFECTIVE YIELD
- --------------------------------------------------------------------------------
The Trust's effective yield for Class A Shares for the seven-day period ended
March 31, 1994 was 2.59%.
The Trust's effective yield is computed by compounding the unannualized base
period return by:
. adding 1 to the base period return;
. raising the sum to the 365/7th power; and
. subtracting 1 from the result.
PERFORMANCE COMPARISONS
- --------------------------------------------------------------------------------
The Trust's performance of each class of Shares depends upon such variables as:
. portfolio quality;
. average portfolio maturity;
. type of instruments in which the portfolio is invested;
. changes in interest rates on money market instruments;
. changes in the Trust's or either class of Shares' expenses; and
. the relative amount of Trust cash flow.
Investors may use financial publications and/or indices to obtain a more
complete view of the Trust's performance. When comparing performance, investors
should consider all relevant factors such as the composition of any index used,
prevailing market conditions, portfolio compositions of other funds, and methods
used to value portfolio securities and compute offering price. The financial
publications and/or indices which the Trust uses in advertising may include:
.LIPPER ANALYTICAL SERVICES, INC. ranks funds in various fund categories by
making comparative calculations using total return. Total return assumes the
reinvestment of all income dividends and capital gains distributions, if any.
From time to time, the Trust will quote its Lipper ranking in the "short-term
U.S. government funds" category in advertising and sales literature.
.SALOMON 30-DAY TREASURY BILL INDEX is a weekly quote of the most representative
yields for selected securities, issued by the U.S. Treasury, maturing in 30
days.
Advertisements and other sales literature for either class of Shares may refer
to "total return." Total return is the historic change in the value of an
investment in either class of Shares of the Trust based on the monthly
reinvestment of dividends over a specified period of time.
From time to time as it deems appropriate, the Trust may advertise its
performance of either class of Shares using charts, graphs, and descriptions,
compared to federally insured bank products including certificates of deposit
and time deposits.
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The financial statements for the fiscal year ended March 31, 1994 are
incorporated herein by reference from the Trust's Annual Report dated March 31,
1994 (File Nos. 2-65447 and 811-2956). A copy of the Annual Report may be
obtained without charge by contacting the Trust at the address listed in the
prospectus.
8062809B (9/94)
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits:
(a) Financial Statements (Incorporated by reference to
Annual
Report of Registrant dated March 31, 1994 (File
Nos. 2-65447
and 811-2956)
(b) Exhibits:
(1) Copy of Declaration of Trust of the
Registrant as amended (1,2,3,6,9);
(2) Copy of By-Laws of the Registrant as amended
(4,7,9,10);
(3) Not applicable;
(4) Copy of Specimen Certificate for Shares of
Beneficial Interest of the Registrant (2);
(5) Copy of new Investment Advisory Contract of
the Registrant(12);
(6) (i) Copy of Administrative Support and
Distributor's Contract of the
Registrant (9);
(ii) Form of new Distributor's Contract of
the
Registrant;+
+ All Exhibits have been filed electronically.
1. Response is incorporated by reference to Registrant's
initial Registration Statement on Form N-1 filed
September 14, 1979 (File No. 2-65447).
2. Response is incorporated by reference to Registrant's Pre-
Effective Amendment No. 2 on Form N-1 filed March 11, 1980
(File No. 2-65447).
3. Response is incorporated by reference to Registrant's Pre-
Effective Amendment No. 3 on Form N-1 filed May 16, 1980
(File No. 2-65447).
4. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 2 on Form N-1 filed May 7, 1981
(File No. 2-65447).
6. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 5 on Form N-1 filed March 31, 1983
(File No. 2-65447).
7. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 9 on Form N-1 filed May 21, 1984
(File No. 2-65447).
8. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 10 on Form N-1A filed March 28, 1985
(File No. 2-65447).
9. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 11 on Form N-1A filed May 30, 1985
(File No. 2-65447).
10. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 16 on Form N-1A filed July 15, 1987
(File No. 2-65447).
11. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 18 on Form N-1A filed July 18, 1988
(File No. 2-65447).
12. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 21 on Form N-1A filed July 28, 1989
(File No. 2-65447).
13. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 23 on Form N-1A filed July 18, 1990
(File No. 2-65447).
14. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 25 on Form N-1A filed July 19, 1991
(File No. 2-65447).
15. Response is incorporated by reference to Registrant's Post-
Effective
Amendment No. 27 on Form N-lA filed July 23, l992 (File No.
2-65447).
16. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 29 on Form N-1A filed July 26, 1993
(File No. 2-65447).
17. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 31 on Form N-1A filed May 26, l994
(File No. 2-65447)
(7) Not applicable;
(8) (i) Conformed Copy of Custodian Agreement of
the Registrant;+
(ii) Conformed Copy of Transfer Agency and
Service Agreement of the Registrant
(16);
(9) (i) Form of Shareholder Services
Subcontract of the
Registrant; +
(ii) Form of Shareholder Services Plan of
the
Registrant; +
(10) Not applicable;
(11) Conformed Copy of Consent of Independent
Public Accountants;+
(12) Not applicable;
(13) Not applicable;
(14) (i) Copy of Keogh Plan of the Registrant
(6);
(ii) Copy of IRA Plan of the Registrant (9);
(15) (i) Copy of Distribution Plan of the
Registrant (9);
(ii) Copy of Sales Agreement of the
Registrant (10);
(iii)Form of Rule 12b-1 Agreement of the
Registrant;+
(16) Schedule for Computation of Yield Calculation
(11);
(17) Financial Data Schedule;+
(18) Power of Attorney (15);
+ All Exhibits have been filed electronically.
1. Response is incorporated by reference to Registrant's
initial Registration Statement on Form N-1 filed
September 14, 1979 (File No. 2-65447).
2. Response is incorporated by reference to Registrant's Pre-
Effective Amendment No. 2 on Form N-1 filed March 11, 1980
(File No. 2-65447).
3. Response is incorporated by reference to Registrant's Pre-
Effective Amendment No. 3 on Form N-1 filed May 16, 1980
(File No. 2-65447).
4. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 2 on Form N-1 filed May 7, 1981
(File No. 2-65447).
6. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 5 on Form N-1 filed March 31, 1983
(File No. 2-65447).
7. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 9 on Form N-1 filed May 21, 1984
(File No. 2-65447).
8. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 10 on Form N-1A filed March 28, 1985
(File No. 2-65447).
9. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 11 on Form N-1A filed May 30, 1985
(File No. 2-65447).
10. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 16 on Form N-1A filed July 15, 1987
(File No. 2-65447).
11. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 18 on Form N-1A filed July 18, 1988
(File No. 2-65447).
12. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 21 on Form N-1A filed July 28, 1989
(File No. 2-65447).
13. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 23 on Form N-1A filed July 18, 1990
(File No. 2-65447).
14. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 25 on Form N-1A filed July 19, 1991
(File No. 2-65447).
15. Response is incorporated by reference to Registrant's Post-
Effective
Amendment No. 27 on Form N-lA filed July 23, l992 (File No.
2-65447).
16. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 29 on Form N-1A filed July 26, 1993
(File No. 2-65447).
17. Response is incorporated by reference to Registrant's Post-
Effective Amendment No. 31 on Form N-1A filed May 26, l994
(File No. 2-65447)
Item 25. Persons Controlled by or Under Common Control with Registrant:
None
Item 26. Number of Holders of Securities:
Number of Record Holders
Title of Class as of October 11, 1994
Shares of Beneficial Interest
(no par value)
Class A Shares 110,811
Class B Shares 0
Item 27. Indemnification: (14)
Item 28. Business and Other Connections of Investment Adviser:
For a description of the other business of the
investment adviser, see the section entitled "Trust
Information - Management of the Trust" in Part A. The
affiliations with the Registrant of four of the
Trustees and one of the officers of the investment
adviser are included in Part A of this Registration
Statement under "Management of the Trust - Officers and
Trustees." The remaining Trustee of the investment
adviser, his position with the investment adviser, and,
in parentheses, his principal occupation is: Mark D.
Olson, Partner, Wilson, Halbrook & Bayard, 107 W.
Market Street, Georgetown, Delaware 19947.
The remaining officers of the investment adviser are:
William D. Dawson, III, J. Thomas Madden, and Mark L.
Mallon, Executive Vice Presidents; Henry J. Gailliot, Senior
Vice President-Economist; Peter R. Anderson, Gary J. Madich,
and J. Alan Minteer, Senior Vice Presidents; Randall A.
Bauer, Jonathan C. Conley, Deborah A. Cunningham, Mark E.
Durbiano, Kathleen M. Foody-Malus, Thomas M. Franks,
Edward C. Gonzales, Jeff A. Kozemchek, Marian R. Marinack,
John W. McGonigle,
Gregory M. Melvin, Susan M. Nason, Mary Jo Ochson, Robert J.
Ostrowski, Charles A. Ritter, and Christopher H. Wiles, Vice
Presidents, Edward C. Gonzales, Treasurer, and John W.
McGonigle, Secretary. The business address of each of the
officers of the Federated Research Division of the
investment adviser is Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779.
Item 29. Principal Underwriters:
(a) Federated Securities Corp., the Distributor
for shares of the Registrant, also acts as principal
underwriter for the following open-end investment
companies: Alexander Hamilton Funds; American
Leaders Fund, Inc.; Annuity Management Series; Arrow
Funds; Automated Cash Management Trust; Automated
Government Money Trust; BayFunds; The Biltmore
Funds; The Biltmore Municipal Funds; California
Municipal Cash Trust; Cash Trust Series, Inc.; Cash
Trust Series II; DG Investor Series; Edward D. Jones
& Co. Daily Passport Cash Trust; Federated ARMs
Fund; Federated Exchange Fund, Ltd.; Federated GNMA
Trust; Federated Government Trust; Federated Growth
Trust; Federated High Yield Trust; Federated Income
Securities Trust; Federated Income Trust; Federated
Index Trust; Federated Institutional Trust;
Federated Intermediate Government Trust; Federated
Master Trust; Federated Municipal Trust; Federated
Short-Intermediate Government Trust; Federated Short-
Term U.S. Government Trust; Federated Stock Trust;
Federated Tax-Free Trust; Federated U.S. Government
Bond Fund; First Priority Funds; First Union Funds;
Fixed Income Securities, Inc.; Fortress Adjustable
Rate U.S. Government Fund, Inc.; Fortress Municipal
Income Fund, Inc.; Fortress Utility Fund, Inc.;
Fountain Square Funds; Fund for U.S. Government
Securities, Inc.; Government Income Securities,
Inc.; High Yield Cash Trust; Independence One Mutual
Funds; Insight Institutional Series, Inc.; Insurance
Management Series; Intermediate Municipal Trust;
International Series Inc.; Investment Series Funds,
Inc.; Investment Series Trust; Liberty Equity Income
Fund, Inc.; Liberty High Income Bond Fund, Inc.;
Liberty Municipal Securities Fund, Inc.; Liberty
U.S. Government Money Market Trust; Liberty Utility
Fund, Inc.; Liquid Cash Trust; Managed Series Trust;
Marshall Funds, Inc.; Money Market Management, Inc.;
The Medalist Funds; Money Market Obligations Trust;
Money Market Trust; The Monitor Funds; Municipal
Securities Income Trust; New York Municipal Cash
Trust; 111 Corcoran Funds; Peachtree Funds; The
Planters Funds; Portage Funds; RIMCO Monument Funds;
The Shawmut Funds; Short-Term Municipal Trust;
SouthTrust Vulcan Funds; Star Funds; The Starburst
Funds; The Starburst Funds II; Stock and Bond Fund,
Inc.; Sunburst Funds; Targeted Duration Trust; Tax-
Free Instruments Trust; Tower Mutual Funds;
Trademark Funds; Trust for Financial Institutions;
Trust for Government Cash Reserves; Trust for Short-
Term U.S. Government Securities; Trust for U.S.
Treasury Obligations; Vision Fiduciary Funds, Inc.;
Vision Group of Funds, Inc.; and World Investment
Series, Inc.
Federated Securities Corp. also acts as principal
underwriter for the following closed-end investment
company: Liberty Term Trust, Inc.- 1999.
(b)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Underwriter With Registrant
Richard B. Fisher Director, Chairman, Chief Vice President
Federated Investors Tower Executive Officer, Chief
Pittsburgh, PA 15222-3779 Operating Officer, and
Asst. Treasurer, Federated
Securities Corp.
Edward C. Gonzales Director, Executive Vice Vice President and
Federated Investors Tower President, and Treasurer, Treasurer
Pittsburgh, PA 15222-3779 Federated Securities
Corp.
John W. McGonigle Director, Executive Vice Vice President and
Federated Investors Tower President, and Assistant Secretary
Pittsburgh, PA 15222-3779 Secretary, Federated
Securities Corp.
John B. Fisher President-Institutional Sales, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James F. Getz President-Broker/Dealer, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark R. Gensheimer Executive Vice President of --
Federated Investors Tower Bank/Trust
Pittsburgh, PA 15222-3779 Federated Securities Corp.
Mark W. Bloss Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Theodore Fadool, Jr. Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Bryant R. Fisher Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Christopher T. Fives Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James S. Hamilton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James M. Heaton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
H. Joseph Kennedy Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Keith Nixon Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Timothy C. Pillion Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James R. Ball Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard W. Boyd Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jane E. Broeren-Lambesis Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mary J. Combs Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
R. Edmond Connell, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Laura M. Deger Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jill Ehrenfeld Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Michael D. Fitzgerald Vice President,
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark D. Fisher Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Joseph D. Gibbons Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
David C. Glabicki Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard C. Gonzales Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Scott A. Hutton Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
William J. Kerns Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
William E. Kugler Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Dennis M. Laffey Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Francis J. Matten, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark J. Miehl Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard C. Mihm Vice President,
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
J. Michael Miller Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
R. Jeffrey Niss Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Michael P. O'Brien Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Robert D. Oelschlager Vice President,
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Solon A. Person, IV Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Robert F. Phillips Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Eugene B. Reed Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Paul V. Riordan Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Charles A. Robison Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
David W. Spears Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jeffrey A. Stewart Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Thomas E. Territ Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jamie M. Teschner Vice President,
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
William C. Tustin Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard B. Watts Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Philip C. Hetzel Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
S. Elliott Cohan Secretary, Federated Assistant
Federated Investors Tower Securities Corp. Secretary
Pittsburgh, PA 15222-3779
(c) Not applicable
Item 30. Location of Accounts and Records:
All accounts and records required to be maintained by Section
31(a) of the Investment Company Act of 1940 and Rules 31a-1
through 31a-3 promulgated thereunder are maintained at one of the
following locations:
Registrant Federated Investors Tower
Pittsburgh, PA 15222-3779
Federated Services Company P.O. Box 8604
("Transfer Agent and Dividend Boston, MA 02266-8604
Disbursing Agent")
Federated Adminstrative Services Federated Investors Tower
("Adminstrator") Pittsburgh, PA 15222-3779
Federated Advisers Federated Investors Tower
("Adviser") Pittsburgh, PA 15222-3779
State Street Bank and Trust Company P.O. Box 1723
("Custodian") Boston, MA 02105
Item 31. Management Services: Not applicable.
Item 32. Undertaking:
Registrant hereby undertakes to comply with the
provisions of Section 16(c) of the 1940 Act with
respect to the removal of Trustees and the calling of
special shareholder meetings by shareholders.
Registrant hereby undertakes to furnish each person to
whom a prospectus is delivered with a copy of the
Registrant's latest annual report to shareholders, upon
request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940, the Registrant, LIBERTY U.S.
GOVERNMENT MONEY MARKET, certifies that it meets all of the
requirements for effectiveness of this Amendment to its
Registration Statement pursuant to Rule 485(A) under the
Securities Act of 1933 and has duly caused this Amendment to its
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of
Pittsburgh and Commonwealth of Pennsylvania, on the 18th day of
October, 1994.
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
BY: /s/Charles H. Field
Charles H. Field, Assistant Secretary
Attorney in Fact for John F. Donahue
October 18, 1994
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to its Registration Statement has been signed
below by the following person in the capacity and on the date
indicated:
NAME TITLE DATE
By: /s/Charles H. Field
Charles H. Field Attorney In Fact October 18, 1994
ASSISTANT SECRETARY For the Persons
Listed Below
NAME TITLE
John F. Donahue* Chairman and Trustee
(Chief Executive Officer)
J. Christopher Donahue* President
Edward C. Gonzales* Vice President and Treasurer
(Principal Financial and
Accounting Officer)
John T. Conroy, Jr.* Trustee
William J. Copeland* Trustee
James E. Dowd* Trustee
Lawrence D. Ellis, M.D.* Trustee
Edward L. Flaherty, Jr.* Trustee
Peter E. Madden* Trustee
Gregor F. Meyer* Trustee
Wesley W. Posvar* Trustee
Marjorie P. Smuts* Trustee
* By Power of Attorney
Exhibit (11) under N-1A
Exhibit 23 under Item 601/Reg SK
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
use in Post-Effective Amendment No. 32 to Form N-1A
Registration Statement of Liberty U.S. Government Money Market
Trust, of our report dated May 13, 1994, included in or made
part of this registration statement.
/S/ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Pittsburgh, Pennsylvania,
October 17, 1994
Exhibit (6)(ii) under Form N-1A
Exhibit (10) under Item601/Reg. S-K
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
DISTRIBUTOR'S CONTRACT
AGREEMENT made this ________________, 1994 by and
between Liberty U.S. Government Money Market Trust
(the "Trust"), a Massachusetts business trust, and
FEDERATED SECURITIES CORP. ("FSC"), a Pennsylvania
Corporation.
In consideration of the mutual covenants
hereinafter contained, it is hereby agreed by and
between the parties hereto as follows:
1. The Trust hereby appoints FSC as its agent to sell
and distribute shares of the Trust which may be
offered in one or more series (the "Funds")
consisting of one or more classes (the "Classes") of
shares (the "Shares"), as described and set forth on
one or more exhibits to this Agreement, at the
current offering price thereof as described and set
forth in the current Prospectuses of the Trust. FSC
hereby accepts such appointment and agrees to
provide such other services for the Trust, if any,
and accept such compensation from the Trust, if any,
as set forth in the applicable exhibits to this
Agreement.
2. The sale of any Shares may be suspended without
prior notice whenever in the judgment of the Trust
it is in its best interest to do so.
3. Neither FSC nor any other person is authorized by
the Trust to give any information or to make any
representation relative to any Shares other than
those contained in the Registration Statement,
Prospectuses, or Statements of Additional
Information ("SAIs") filed with the Securities and
Exchange Commission, as the same may be amended from
time to time, or in any supplemental information to
said Prospectuses or SAIs approved by the Trust. FSC
agrees that any other information or representations
other than those specified above which it or any
dealer or other person who purchases Shares through
FSC may make in connection with the offer or sale of
Shares, shall be made entirely without liability on
the part of the Trust. No person or dealer, other
than FSC, is authorized to act as agent for the
Trust for any purpose. FSC agrees that in offering
or selling Shares as agent of the Trust, it will, in
all respects, duly conform to all applicable state
and federal laws and the rules and regulations of
the National Association of Securities Dealers,
Inc., including its Rules of Fair Practice. FSC will
submit to the Trust copies of all sales literature
before using the same and will not use such sales
literature if disapproved by the Trust.
4. This Agreement is effective with respect to each
Class as of the date of execution of the applicable
exhibit and shall continue in effect with respect to
each Class presently set forth on an exhibit and any
subsequent Classes added pursuant to an exhibit
during the initial term of this Agreement for one
year from the date set forth above, and thereafter
for successive periods of one year if such
continuance is approved at least annually by the
Trustees of the Trust including a majority of the
members of the Board of Trustees of the Trust who
are not interested persons of the Trust and have no
direct or indirect financial interest in the
operation of any Distribution Plan relating to the
Trust or in any related documents to such Plan
("Disinterested Trustees") cast in person at a
meeting called for that purpose. If a Class is added
after the first annual approval by the Trustees as
described above, this Agreement will be effective as
to that Class upon execution of the applicable
exhibit and will continue in effect until the next
annual approval of this Agreement by the Trustees
and thereafter for successive periods of one year,
subject to approval as described above.
5. This Agreement may be terminated with regard to a
particular Fund or Class at any time, without the
payment of any penalty, by the vote of a majority of
the Disinterested Trustees or by a majority of the
outstanding voting securities of the particular Fund
or Class on not more than sixty (60) days' written
notice to any other party to this Agreement. This
Agreement may be terminated with regard to a
particular Fund or Class by FSC on sixty (60) days'
written notice to the Trust.
6. This Agreement may not be assigned by FSC and shall
automatically terminate in the event of an
assignment by FSC as defined in the Investment
Company Act of 1940, as amended, provided, however,
that FSC may employ such other person, persons,
corporation or corporations as it shall determine in
order to assist it in carrying out its duties under
this Agreement.
7. FSC shall not be liable to the Trust for anything
done or omitted by it, except acts or omissions
involving willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties
imposed by this Agreement.
8. This Agreement may be amended at any time by mutual
agreement in writing of all the parties hereto,
provided that such amendment is approved by the
Trusteesof the Trust including a majority of the
Disinterested Trustees of the Trust cast in person
at a meeting called for that purpose.
9. This Agreement shall be construed in accordance with
and governed by the laws of the Commonwealth of
Pennsylvania.
10.(a) Subject to the conditions set forth below, the
Trust agrees to indemnify and hold harmless FSC
and each person, if any, who controls FSC
within the meaning of Section 15 of the
Securities Act of 1933 and Section 20 of the
Securities Act of 1934, as amended, against any
and all loss, liability, claim, damage and
expense whatsoever (including but not limited
to any and all expenses whatsoever reasonably
incurred in investigating, preparing or
defending against any litigation, commenced or
threatened, or any claim whatsoever) arising
out of or based upon any untrue statement or
alleged untrue statement of a material fact
contained in the Registration Statement, any
Prospectuses or SAIs (as from time to time
amended and supplemented) or the omission or
alleged omission therefrom of a material fact
required to be stated therein or necessary to
make the statements therein not misleading,
unless such statement or omission was made in
reliance upon and in conformity with written
information furnished to the Trust about FSC by
or on behalf of FSC expressly for use in the
Registration Statement, any Prospectuses and
SAIs or any amendment or supplement thereof.
If any action is brought against FSC or any
controlling person thereof with respect to
which indemnity may be sought against the Trust
pursuant to the foregoing paragraph, FSC shall
promptly notify the Trust in writing of the
institution of such action and the Trust shall
assume the defense of such action, including
the employment of counsel selected by the Trust
and payment of expenses. FSC or any such
controlling person thereof shall have the right
to employ separate counsel in any such case,
but the fees and expenses of such counsel shall
be at the expense of FSC or such controlling
person unless the employment of such counsel
shall have been authorized in writing by the
Trust in connection with the defense of such
action or the Trust shall not have employed
counsel to have charge of the defense of such
action, in any of which events such fees and
expenses shall be borne by the Trust. Anything
in this paragraph to the contrary
notwithstanding, the Trust shall not be liable
for any settlement of any such claim of action
effected without its written consent. The Trust
agrees promptly to notify FSC of the
commencement of any litigation or proceedings
against the Trust or any of its officers or
Trustees or controlling persons in connection
with the issue and sale of Shares or in
connection with the Registration Statement,
Prospectuses, or SAIs.
(b) FSC agrees to indemnify and hold harmless the
Trust, each of its Trustees, each of its
officers who have signed the Registration
Statement and each other person, if any, who
controls the Trust within the meaning of
Section 15 of the Securities Act of 1933, but
only with respect to statements or omissions,
if any, made in the Registration Statement or
any Prospectus, SAI, or any amendment or
supplement thereof in reliance upon, and in
conformity with, information furnished to the
Trust about FSC by or on behalf of FSC
expressly for use in the Registration Statement
or any Prospectus, SAI, or any amendment or
supplement thereof. In case any action shall be
brought against the Trust or any other person
so indemnified based on the Registration
Statement or any Prospectus, SAI, or any
amendment or supplement thereof, and with
respect to which indemnity may be sought
against FSC, FSC shall have the rights and
duties given to the Trust, and the Trust and
each other person so indemnified shall have the
rights and duties given to FSC by the
provisions of subsection (a) above.
(c) Nothing herein contained shall be deemed to
protect any person against liability to the
Trust or its shareholders to which such person
would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in
the performance of the duties of such person or
by reason of the reckless disregard by such
person of the obligations and duties of such
person under this Agreement.
(d) Insofar as indemnification for liabilities may
be permitted pursuant to Section 17 of the
Investment Company Act of 1940, as amended, for
Trustees, officers, FSC and controlling persons
of the Trust by the Trust pursuant to this
Agreement, the Trust is aware of the position
of the Securities and Exchange Commission as
set forth in the Investment Company Act Release
No. IC-11330. Therefore, the Trust undertakes
that in addition to complying with the
applicable provisions of this Agreement, in the
absence of a final decision on the merits by a
court or other body before which the proceeding
was brought, that an indemnification payment
will not be made unless in the absence of such
a decision, a reasonable determination based
upon factual review has been made (i) by a
majority vote of a quorum of non-party
Disinterested Trustees, or (ii) by independent
legal counsel in a written opinion that the
indemnitee was not liable for an act of willful
misfeasance, bad faith, gross negligence or
reckless disregard of duties. The Trust further
undertakes that advancement of expenses
incurred in the defense of a proceeding (upon
undertaking for repayment unless it is
ultimately determined that indemnification is
appropriate) against an officer, Trustee, FSC
or controlling person of the Trust will not be
made absent the fulfillment of at least one of
the following conditions: (i) the indemnitee
provides security for his undertaking; (ii) the
Trust is insured against losses arising by
reason of any lawful advances; or (iii) a
majority of a quorum of non-party Disinterested
Trustees or independent legal counsel in a
written opinion makes a factual determination
that there is reason to believe the indemnitee
will be entitled to indemnification.
11.FSC is hereby expressly put on notice of the
limitation of liability as set forth in the
Declaration of Trust and agrees that the obligations
assumed by the Trust pursuant to this Agreement
shall be limited in any case to the Trust and its
assets and FSC shall not seek satisfaction of any
such obligation from the shareholders of the Trust,
the Trustees, officers, employees or agents of the
Trust, or any of them.
12.If at any time the Shares of any Fund are offered in
two or more Classes, FSC agrees to adopt compliance
standards as to when a class of shares may be sold
to particular investors.
13.This Agreement will become binding on the parties
hereto upon the execution of the attached exhibits
to the Agreement.
Exhibit A
to the
Distributor's Contract
Liberty U.S. Government Money Market Trust
Class B Shares
In consideration of the mutual covenants set forth
in the Distributor's Contract dated ____________,
1994 between Liberty U.S. Government Money Market
Trust and Federated Securities Corp., Liberty U.S.
Government Money Market Trust executes and delivers
this Exhibit on behalf of , and with respect to the
Class B Shares thereof, first set forth in this
Exhibit.
Witness the due execution hereof this 1st day of
________________, 1994.
ATTEST: LIBERTY U.S. GOVERNMENT
MONEY MARKET TRUST
By:
Secretary President
(SEAL)
ATTEST: FEDERATED SECURITIES CORP.
By:
Secretary Executive Vice President
(SEAL)
Exhibit B
to the
Distributor's Contract
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
Class B Shares
The following provisions are hereby incorporated
and made part of the Distributor's Contract dated
___________, 1994, between Liberty U.S. Government
Money Market Trust and Federated Securities Corp.
with respect to the Class of shares set forth above.
1. The Trust hereby appoints FSC to engage in
activities principally intended to result in the
sale of shares of the above-listed Class ("Shares").
Pursuant to this appointment, FSC is authorized to
select a group of financial institutions ("Financial
Institutions") to sell Shares at the current
offering price thereof as described and set forth in
the respective prospectuses of the Trust.
2. During the term of this Agreement, the Trust will
pay FSC for services pursuant to this Agreement, a
monthly fee computed at the annual rate of .75 of 1%
of the average aggregate net asset value of the
Shares held during the month. For the month in which
this Agreement becomes effective or terminates,
there shall be an appropriate proration of any fee
payable on the basis of the number of days that the
Agreement is in effect during the month.
3. FSC may from time-to-time and for such periods as it
deems appropriate reduce its compensation to the
extent any Class' expenses exceed such lower expense
limitation as FSC may, by notice to the Trust,
voluntarily declare to be effective.
4. FSC will enter into separate written agreements with
various firms to provide certain of the services set
forth in Paragraph 1 herein. FSC, in its sole
discretion, may pay Financial Institutions a
periodic fee in respect of Shares owned from time to
time by their clients or customers. The schedules of
such fees and the basis upon which such fees will be
paid shall be determined from time to time by FSC in
its sole discretion.
5. FSC will prepare reports to the Board of Trustees of
the Trust on a quarterly basis showing amounts
expended hereunder including amounts paid to
Financial Institutions and the purpose for such
expenditures.
In consideration of the mutual covenants set forth
in the Distributor's Contract dated ___________, 1994
between Liberty U.S. Government Money Market Trust
and Federated Securities Corp., Liberty U.S.
Government Money Market Trustexecutes and delivers
this Exhibit on behalf of the , and with respect to
the Class B Shares thereof, first set forth in this
Exhibit.
Witness the due execution hereof this 1st day of
___________, 1994.
ATTEST: LIBERTY U.S. GOVERNMENT
MONEY MARKET TRUST
By:
Secretary President
(SEAL)
ATTEST: FEDERATED SECURITIES CORP.
By:
Secretary Executive Vice President
(SEAL)
FSS subcontract 1
Exhibit (9)(i) under Form N-1A
Exhibit (10) under Item 601/Reg. S-K
SHAREHOLDER SERVICES SUB-CONTRACT
This Agreement is made between the Financial
Institution executing this Agreement ("Provider") and
Federated Shareholder Services ("FSS") on behalf of the
investment companies listed in Exhibit A hereto (the
"Funds"), for whom FSS administers the Shareholder Services
Plan ("Plan") and who have approved this form of Agreement.
In consideration of the mutual covenants hereinafter
contained, it is hereby agreed by and between the parties
hereto as follows:
1. FSS hereby appoints Provider to render or cause to
be rendered personal services to shareholders of the Funds
and/or the maintenance of accounts of shareholders of the
Funds ("Services"). Provider agrees to provide Services
which, in its best judgment, are necessary or desirable for
its customers who are investors in the Funds. Provider
further agrees to provide FSS, upon request, a written
description of the Services which Provider is providing
hereunder.
2. During the term of this Agreement, the Funds will
pay the Provider fees as set forth in a written schedule
delivered to the Provider pursuant to this Agreement. The
fee schedule for Provider may be changed by FSS sending a
new fee schedule to Provider pursuant to Paragraph 9 of this
Agreement. For the payment period in which this Agreement
becomes effective or terminates, there shall be an
appropriate proration of the fee on the basis of the number
of days that this Agreement is in effect during the quarter.
To enable the Funds to comply with an applicable exemptive
order, Provider represents that the fees received pursuant
to this Agreement will be disclosed to its customers, will
be authorized by its customers, and will not result in an
excessive fee to the Provider.
3. The Provider understands that the Department of
Labor views ERISA as prohibiting fiduciaries of
discretionary ERISA assets from receiving shareholder
service fees or other compensation from funds in which the
fiduciary's discretionary ERISA assets are invested. To
date, the Department of Labor has not issued any exemptive
order or advisory opinion that would exempt fiduciaries from
this interpretation. Without specific authorization from
the Department of Labor, fiduciaries should carefully avoid
investing discretionary assets in any fund pursuant to an
arrangement where the fiduciary is to be compensated by the
fund for such investment. Receipt of such compensation
could violate ERISA provisions against fiduciary self-
dealing and conflict of interest and could subject the
fiduciary to substantial penalties.
4. The Provider agrees not to solicit or cause to be
solicited directly, or indirectly at any time in the future,
any proxies from the shareholders of a Fund in opposition to
proxies solicited by management of the Fund, unless a court
of competent jurisdiction shall have determined that the
conduct of a majority of the Board of Trustees or Directors
of the Fund constitutes willful misfeasance, bad faith,
gross negligence or reckless disregard of their duties.
This paragraph 4 will survive the term of this Agreement.
5. This Agreement shall continue in effect for one
year from the date of its execution, and thereafter for
successive periods of one year if the form of this Agreement
is approved at least annually by the Board of each Fund,
including a majority of the members of the Board of the Fund
who are not interested persons of the Fund and have no
direct or indirect financial interest in the operation of
the Fund's Plan or in any related documents to the Plan
("Disinterested Board Members") cast in person at a meeting
called for that purpose.
6. Notwithstanding paragraph 5, this Agreement may be
terminated as follows:
(a) at any time, without the payment of any
penalty, by the vote of a majority of the
Disinterested Board Members of the Fund or by a vote
of a majority of the outstanding voting securities of
the Fund as defined in the Investment Company Act of
1940 on not more than sixty (60) days' written notice
to the parties to this Agreement;
(b) automatically in the event of the
Agreement's assignment as defined in the Investment
Company Act of 1940; and
(c) by either party to the Agreement without
cause by giving the other party at least sixty (60)
days' written notice of its intention to terminate.
7. The Provider agrees to obtain any taxpayer
identification number certification from its customers
required under Section 3406 of the Internal Revenue Code,
and any applicable Treasury regulations, and to provide the
Fund or its designee with timely written notice of any
failure to obtain such taxpayer identification number
certification in order to enable the implementation of any
required backup withholding.
8. The execution and delivery of this Agreement have
been authorized by the Trustees of FSS and signed by an
authorized officer of FSS, acting as such, and neither such
authorization by such Trustees nor such execution and
delivery by such officer shall be deemed to have been made
by any of them individually or to impose any liability on
any of them personally, and the obligations of this
Agreement are not binding upon any of the Trustees or
shareholders of FSS, but bind only the trust property of FSS
as provided in the Declaration of Trust of FSS.
9. Notices of any kind to be given hereunder shall be
in writing (including facsimile communication) and shall be
duly given if delivered to Provider at the address set forth
below and if delivered to FSS at Federated Investors Tower,
Pittsburgh, PA 15222-3779, Attention: President.
10. This Agreement constitutes the entire agreement
between the parties hereto and supersedes any prior
agreement with respect to the subject hereof whether oral or
written. If any provision of this Agreement shall be held
or made invalid by a court or regulatory agency decision,
statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. Subject to the provisions of
Sections 5 and 6, hereof, this Agreement shall be binding
upon and shall inure to the benefit of the parties hereto
and their respective successors and shall be governed by
Pennsylvania law; provided, however, that nothing herein
shall be construed in a manner inconsistent with the
Investment Company Act of 1940 or any rule or regulation
promulgated by the Securities and Exchange Commission
thereunder.
11. This Agreement may be executed by different
parties on separate counterparts, each of which, when so
executed and delivered, shall be an original, and all such
counterparts shall together constitute one and the same
instrument.
12. This Agreement shall not be assigned by any party
without the prior written consent of FSS in the case of
assignment by Provider, or of Provider in the case of
assignment by FSS, except that any party may assign to a
successor all of or a substantial portion of its business to
a party controlling, controlled by, or under common control
with such party.
13. This Agreement may be amended by FSS from time to
time by the following procedure. FSS will mail a copy of
the amendment to the Provider's address, as shown below. If
the Provider does not object to the amendment within thirty
(30) days after its receipt, the amendment will become part
of the Agreement. The Provider's objection must be in
writing and be received by FSS within such thirty days.
14. This Agreement may be terminated with regard to a
particular Fund or Class at any time, without the payment of
any penalty, by FSS or by the vote of a majority of the
Disinterested Trustees or Directors, as applicable, or by a
majority of the outstanding voting securities of the
particular Fund or Class on not more than sixty (60) days'
written notice to the Provider. This Agreement may be
terminated by Provider on sixty (60) days' written notice
to FSS.
15. The Provider acknowledges and agrees that FSS has
entered into this Agreement solely in the capacity of agent
for the Funds and administrator of the Plan. The Provider
agrees not to claim that FSS is liable for any
responsibilities or amounts due by the Funds hereunder.
[Provider]
Address
City State Zip Code
Dated: By:
Authorized Signature
Title
Print Name of Authorized
Signature
FEDERATED SHAREHOLDER SERVICES
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:
Vice President
EXHIBIT A to Shareholder Services Sub-Contract with
Liberty U.S. Government Money Market Trust - Class B Shares
Funds covered by this Agreement:
Liberty U.S. Government Money Market Trust - Class B Shares
Shareholder Service Fees
1. During the term of this Agreement, FSS will pay
Provider a quarterly fee. This fee will be computed at the
annual rate of .25 of 1% of the average net asset value of
shares of the Funds held during the quarter in accounts for
which the Provider provides Services under this Agreement,
so long as the average net asset value of Shares in the
Funds during the quarter equals or exceeds such minimum
amount as FSS shall from time to time determine and
communicate in writing to the Provider.
2. For the quarterly period in which the Agreement
becomes effective or terminates, there shall be an
appropriate proration of any fee payable on the basis of the
number of days that the Agreement is in effect during the
quarter.
-1-
Exhibit (9)(iii) under Form N-1A
Exhibit (10) under Item 601/Reg. S-K
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
SHAREHOLDER SERVICES PLAN
This Shareholder Services Plan ("Plan") is adopted
as of this __ day of _________, 19__, by the Board of
Trustees of Liberty U.S. Government Money Market Trust (the
"Fund"), a Massachusetts business trust with respect to
certain classes of shares ("Classes") of the portfolios of
the Trust ("the Portfolios") set forth in exhibits hereto.
1. This Plan is adopted to allow the Fund to
make payments as contemplated herein to obtain certain
personal services for shareholders and/or the maintenance of
shareholder accounts ("Services").
2. This Plan is designed to compensate
broker/dealers and other participating financial
institutions and other persons ("Providers") for providing
services to the Fund and its shareholders. The Plan will be
administered by Federated Administrative Services ("FAS").
In compensation for the services provided pursuant to this
Plan, Providers will be paid a monthly fee computed at the
annual rate not to exceed .25 of 1% of the average aggregate
net asset value of the shares of the Fund held during the
month.
3. Any payments made by the Portfolios to any
Provider pursuant to this Plan will be made pursuant to the
"Shareholder Services Agreement" entered into by FAS on
behalf of the Fund and the Provider. Providers which have
previously entered into "Administrative Agreements" or "Rule
12b-1 Agreements" with Federated Securities Corp. may be
compensated under this Plan for Services performed pursuant
to those Agreements until the Providers have executed a
"Shareholder Services Agreement" hereunder.
4. The Fund has the right (i) to select, in its
sole discretion, the Providers to participate in the Plan
and (ii) to terminate without cause and in its sole
discretion any Shareholder Services Agreement.
5. Quarterly in each year that this Plan remains
in effect, FAS shall prepare and furnish to the Board of
Trustees of the Fund, and the Board of Trustees shall
review, a written report of the amounts expended under the
Plan.
6. This Plan shall become effective (i) after
approval by majority votes of: (a) the Fund's Board of
Trustees; and (b) the members of the Board of the Trust who
are not interested persons of the Trust and have no direct
or indirect financial interest in the operation of the
Trust's Plan or in any related documents to the Plan
("Disinterested Trustees"), cast in person at a meeting
called for the purpose of voting on the Plan; and (ii) upon
execution of an exhibit adopting this Plan.
7. This Plan shall remain in effect with respect
to each Class presently set forth on an exhibit and any
subsequent Classes added pursuant to an exhibit during the
initial year of this Plan for the period of one year from
the date set forth above and may be continued thereafter if
this Plan is approved with respect to each Class at least
annually by a majority of the Trust's Board of Trustees and
a majority of the Disinterested Trustees, cast in person at
a meeting called for the purpose of voting on such Plan. If
this Plan is adopted with respect to a class after the first
annual approval by the Trustees as described above, this
Plan will be effective as to that Class upon execution of
the applicable exhibit pursuant to the provisions of
paragraph 6(ii) above and will continue in effect until the
next annual approval of this Plan by the Trustees and
thereafter for successive periods of one year subject to
approval as described above.
8. All material amendments to this Plan must be
approved by a vote of the Board of Trustees of the Fund and
of the Disinterested Trustees, cast in person at a meeting
called for the purpose of voting on it.
9. This Plan may be terminated at any time by:
(a) a majority vote of the Disinterested Trustees; or (b) a
vote of a majority of the outstanding voting securities of
the Fund as defined in Section 2(a)(42) of the Act.
10. While this Plan shall be in effect, the
selection and nomination of Disinterested Trustees of the
Fund shall be committed to the discretion of the
Disinterested Trustees then in office.
11. All agreements with any person relating
to the implementation of this Plan shall be in writing and
any agreement related to this Plan shall be subject to
termination, without penalty, pursuant to the provisions of
Paragraph 9 herein.
12. This Plan shall be construed in
accordance with and governed by the laws of the Commonwealth
of Pennsylvania.
Witness the due execution hereof this [date].
Liberty U.S. Government Money Market
Trust
By:
President
EXHIBIT A
to the
Plan
Liberty U.S. Government Money Market Trust
Class B Shares
This Plan is adopted by Liberty U.S. Government
Money Market Trust with respect to the Class of Shares of
the Trust set forth above.
In compensation for the services provided pursuant
to this Plan, Providers will be paid a monthly fee computed
at the annual rate of .25 of 1% of the average aggregate net
asset value of the Class B Shares of Liberty U.S. Government
Money Market Trust held during the month.
Witness the due execution hereof this ____ day of
________, 19__.
Liberty U.S. Government Money Market
Trust
By:
President
1
Exhibit (15)(iii) under Form N-1A
Exhibit (99) under Item 601/Reg. S-K
RULE 12b-1 AGREEMENT
This Agreement is made between the Financial Institution
executing this Agreement ("Administrator") and Federated
Securities Corp. ("FSC") for the mutual funds (referred to
individually as the "Fund" and collectively as the "Funds") for
which FSC serves as Distributor of shares of beneficial interest
or capital stock ("Shares") and which have adopted a Rule 12b-1
Plan ("Plan") and approved this form of agreement pursuant to
Rule 12b-1 under the Investment Company Act of 1940. In
consideration of the mutual covenants hereinafter contained, it
is hereby agreed by and between the parties hereto as follows:
1. FSC hereby appoints Administrator to render or cause to
be rendered sales and administrative support services to the
Funds and their shareholders.
2. The services to be provided under Paragraph 1 may
include, but are not limited to, the following:
(a) communicating account openings through computer
terminals located on the Administrator's premises
("computer terminals"), through a toll-free telephone
number or otherwise;
(b) communicating account closings via the computer
terminals, through a toll-free telephone number or
otherwise;
(c) entering purchase transactions through the computer
terminals, through a toll-free telephone number or
otherwise;
(d) entering redemption transactions through the
computer terminals, through a toll-free telephone number
or otherwise;
(e) electronically transferring and receiving funds for
Fund Share purchases and redemptions, and confirming and
reconciling all such transactions;
(f) reviewing the activity in Fund accounts;
(g) providing training and supervision of its personnel;
(h) maintaining and distributing current copies of
prospectuses and shareholder reports;
(i) advertising the availability of its services and
products;
(j) providing assistance and review in designing
materials to send to customers and potential customers
and developing methods of making such materials
accessible to customers and potential customers; and
(k) responding to customers' and potential customers'
questions about the Funds.
The services listed above are illustrative. The Administrator
is not required to perform each service and may at any time
perform either more or fewer services than described above.
3. During the term of this Agreement, FSC will pay the
Administrator fees for each Fund as set forth in a written
schedule delivered to the Administrator pursuant to this
Agreement. FSC's fee schedule for Administrator may be changed
by FSC sending a new fee schedule to Administrator pursuant to
Paragraph 12 of this Agreement. For the payment period in which
this Agreement becomes effective or terminates, there shall be
an appropriate proration of the fee on the basis of the number
of days that the Rule 12b-1 Agreement is in effect during the
quarter.
4. The Administrator will not perform or provide any duties
which would cause it to be a fiduciary under Section 4975 of the
Internal Revenue Code, as amended. For purposes of that
Section, the Administrator understands that any person who
exercises any discretionary authority or discretionary control
with respect to any individual retirement account or its assets,
or who renders investment advice for a fee, or has any authority
or responsibility to do so, or has any discretionary authority
or discretionary responsibility in the administration of such an
account, is a fiduciary.
5. The Administrator understands that the Department of
Labor views ERISA as prohibiting fiduciaries of discretionary
ERISA assets from receiving administrative service fees or other
compensation from funds in which the fiduciary's discretionary
ERISA assets are invested. To date, the Department of Labor has
not issued any exemptive order or advisory opinion that would
exempt fiduciaries from this interpretation. Without specific
authorization from the Department of Labor, fiduciaries should
carefully avoid investing discretionary assets in any fund
pursuant to an arrangement where the fiduciary is to be
compensated by the fund for such investment. Receipt of such
compensation could violate ERISA provisions against fiduciary
self-dealing and conflict of interest and could subject the
fiduciary to substantial penalties.
6. The Administrator agrees not to solicit or cause to be
solicited directly, or indirectly at any time in the future, any
proxies from the shareholders of any or all of the Funds in
opposition to proxies solicited by management of the Fund or
Funds, unless a court of competent jurisdiction shall have
determined that the conduct of a majority of the Board of
Directors or Trustees of the Fund or Funds constitutes willful
misfeasance, bad faith, gross negligence or reckless disregard
of their duties. This paragraph 6 will survive the term of this
Agreement.
7. With respect to each Fund, this Agreement shall continue
in effect for one year from the date of its execution, and
thereafter for successive periods of one year if the form of
this Agreement is approved at least annually by the Directors or
Trustees of the Fund, including a majority of the members of the
Board of Directors or Trustees of the Fund who are not
interested persons of the Fund and have no direct or indirect
financial interest in the operation of the Fund's Plan or in any
related documents to the Plan ("Disinterested Directors or
Trustees") cast in person at a meeting called for that purpose.
8. Notwithstanding paragraph 7, this Agreement may be
terminated as follows:
(a) at any time, without the payment of any penalty, by
the vote of a majority of the Disinterested Directors or
Trustees of the Fund or by a vote of a majority of the
outstanding voting securities of the Fund as defined in
the Investment Company Act of 1940 on not more than sixty
(60) days' written notice to the parties to this
Agreement;
(b) automatically in the event of the Agreement's
assignment as defined in the Investment Company Act of
1940 or upon the termination of the "Administrative
Support and Distributor's Contract" or "Distributor's
Contract" between the Fund and FSC; and
(c) by either party to the Agreement without cause by
giving the other party at least sixty (60) days' written
notice of its intention to terminate.
9. The termination of this Agreement with respect to any one
Fund will not cause the Agreement's termination with respect to
any other Fund.
10. The Administrator agrees to obtain any taxpayer
identification number certification from its customers required
under Section 3406 of the Internal Revenue Code, and any
applicable Treasury regulations, and to provide FSC or its
designee with timely written notice of any failure to obtain
such taxpayer identification number certification in order to
enable the implementation of any required backup withholding.
11. This Agreement supersedes any prior service agreements
between the parties for the Funds.
12. This Agreement may be amended by FSC from time to time
by the following procedure. FSC will mail a copy of the
amendment to the Administrator's address, as shown below. If
the Administrator does not object to the amendment within thirty
(30) days after its receipt, the amendment will become part of
the Agreement. The Administrator's objection must be in writing
and be received by FSC within such thirty days.
13. This Agreement shall be construed in accordance with the
Laws of the Commonwealth of Pennsylvania.
____________________________
[Administrator]
_________________________________
Address
_________________________________
City State Zip Code
Dated:_______________________
By:______________________________
Authorized Signature
__________________________________
Title
__________________________________
Print Name of Authorized
Signature
FEDERATED SECURITIES CORP.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-
3779
By:_________________________________
James F. Getz, President
Liberty U.S. Government Money Market Trust
_______________________
EXHIBIT A to 12b-1 Agreement with
Federated Securities Corp. ("FSC")
Portfolios
FSC will pay Administrator fees for the following
portfolios (the "Funds") effective as of the dates set forth
below:
Name Date
Liberty U.S. Government
Money Market Trust - Class B Shares
Administrative Fees
1. During the term of this Agreement, FSC will pay
Administrator a quarterly fee in respect of each Fund. This fee
will be computed at the annual rate of .75% of the average net
asset value of Shares held during the quarter in accounts for
which the Administrator provides services under this Agreement,
so long as the average net asset value of Shares in each Fund
during the quarter equals or exceeds such minimum amount as FSC
shall from time to time determine and communicate in writing to
the Administrator.
2. For the quarterly period in which the Agreement becomes
effective or terminates, there shall be an appropriate proration
of any fee payable on the basis of the number of days that the
Agreement is in effect during the quarter.
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
Exhibit 17 under Form N-1A
Exhibit 27 under Item 601 Reg. S-K
LIBERTY U.S. GOVERNMENT MONEY MARKET TRUST
ARTICLE 6
PERIOD-TYPE 12-MOS
FISCAL-YEAR-END MAR-31-1994
PERIOD-END MAR-31-1994
INVESTMENTS-AT-COST 802,399,829
INVESTMENTS-AT-VALUE 802,399,829
RECEIVABLES 6,356,642
ASSETS-OTHER 154,339
OTHER-ITEMS-ASSETS 0
TOTAL-ASSETS 808,910,810
PAYABLE-FOR-SECURITIES 0
SENIOR-LONG-TERM-DEBT 0
OTHER-ITEMS-LIABILITIES 3,003,797
TOTAL-LIABILITIES 3,003,797
SENIOR-EQUITY 0
PAID-IN-CAPITAL-COMMON 805,907,013
SHARES-COMMON-STOCK 805,907,013
SHARES-COMMON-PRIOR 919,883,283
ACCUMULATED-NII-CURRENT 0
OVERDISTRIBUTION-NII 0
ACCUMULATED-NET-GAINS 0
OVERDISTRIBUTION-GAINS 0
ACCUM-APPREC-OR-DEPREC 0
NET-ASSETS 805,907,013
DIVIDEND-INCOME 0
INTEREST-INCOME 28,138,584
OTHER-INCOME 0
EXPENSES-NET 8,588,992
NET-INVESTMENT-INCOME 19,549,592
REALIZED-GAINS-CURRENT 0
APPREC-INCREASE-CURRENT 0
NET-CHANGE-FROM-OPS 19,549,592
EQUALIZATION 0
DISTRIBUTIONS-OF-INCOME 19,549,592
DISTRIBUTIONS-OF-GAINS 0
DISTRIBUTIONS-OTHER 0
NUMBER-OF-SHARES-SOLD 361,379,933
NUMBER-OF-SHARES-REDEEMED 492,734,547
SHARES-REINVESTED 17,378,344
NET-CHANGE-IN-ASSETS (113,976,270)
ACCUMULATED-NII-PRIOR 0
ACCUMULATED-GAINS-PRIOR 0
OVERDISTRIB-NII-PRIOR 0
OVERDIST-NET-GAINS-PRIOR 0
GROSS-ADVISORY-FEES 4,147,512
INTEREST-EXPENSE 0
GROSS-EXPENSE 8,588,992
AVERAGE-NET-ASSETS 846,837,582
PER-SHARE-NAV-BEGIN 1.000
PER-SHARE-NII 0.020
PER-SHARE-GAIN-APPREC 0
PER-SHARE-DIVIDEND 0.020
PER-SHARE-DISTRIBUTIONS 0
RETURNS-OF-CAPITAL 0
PER-SHARE-NAV-END 1.000
EXPENSE-RATIO 101
AVG-DEBT-OUTSTANDING 0
AVG-DEBT-PER-SHARE 0
</TABLE>
