1933 Act File No.2-64536
1940 Act File No.811-2924
SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Post-Effective Amendment No. 24 [X]
And
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT [X]
OF 1940
Amendment No. 22 [X]
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND
Exact Name of Registrant as Specified in Charter
767 FIFTH AVENUE, NEW YORK, N. Y. 10153-0203
Address of Principal Executive Office
Registrant's Telephone Number (212) 848-1800
Thomas F. Konop, Vice President
767 FIFTH AVENUE, NEW YORK, N. Y. 10153
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
immediately on filing pursuant to paragraph (b) of Rule 485
X on November 1, 1998 pursuant to paragraph (b) of Rule 485
_____
_____ 60 days after filing pursuant to paragraph (a) (1) of Rule 485
on (date) pursuant to paragraph (a) (1) of Rule 485
_____ 75 days after filing pursuant to paragraph (a) (2) of Rule 485
_____ on (date) pursuant to paragraph (a) (2) 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
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
FORM N-1A
Cross Reference Sheet
Post-Effective Amendment No. 24
Pursuant to Rule 481(a)
Form N-1A Location In Prospectus or
Item No. Statement of Additional Information
1 Cover Page
2 Fee Table
3 (a) Financial Highlights; Performance
3 (b) N/A
4 (a) (i) Cover Page
4 (a) (ii) Investment Objective; How We Invest
4 (b) (c) How We Invest
5 (a) (b) (c) Our Management; Back Cover Page
5 (d) N/A
5 (e) Back Cover Page
5 (f) Our Management
5 (g) N/A
5 A Performance
6 (a) Cover Page
6 (b) (c) (d) N/A
6 (e) Cover Page
6 (f) (g) Dividends, Capital Gains
Distributions and Taxes
7 (a) Back Cover Page
7 (b) (c) (d)
(e) (f) Purchases
8 Redemptions and Repurchases
9 N/A
10 Cover Page
11 Cover Page - Table of Contents
12 N/A
13 Investment Objective and Policies
14 Directors and Officers
15 (a) (b) N/A
15 (c) Directors and Officers
16 (a) (i) Investment Advisory and Other Services
16 (a) (ii) Directors and Officers
16 (a) (iii) Investment Advisory and Other Services
16 (b) Investment Advisory and Other Services
16 (c) (d) (e)
(g) N/A
16 (f) Purchases, Redemptions
and Shareholder Services
16 (h) Investment Advisory and Other Services
Form N-1A Location In Prospectus or
Item No. Statement of Additional Information
16 (i) N/A
17 (a) Portfolio Transactions
17 (b) N/A
17 (c) Portfolio Transactions
17 (d) Portfolio Transactions
17 (e) N/A
18 (a) Cover Page
18 (b) N/A
19 (a) (b) Purchases, Redemptions
and Shareholder Services
19 (c) N/A
20 Taxes
21 (a) Purchases, Redemptions
and Shareholder Services
21 (b) (c) N/A
22 (a) N/A
22 (b) Past Performance
23 Financial Statements
<PAGE>
This Prospectus sets forth concisely the information about Lord Abbett U.S.
Government Securities Money Market Fund, Inc. ("we" or the "Fund") that you
should know before investing. Please read this Prospectus before investing and
retain it for future reference.
The Fund has three classes of shares, designated Classes A, B and C, which
provide you with different purchasing options. See "Purchases" for a description
of these options.
The investment objective of the Fund is to provide high current income and
preservation of capital through investments in high-quality, short-term liquid
securities. There can be no assurance that this objective will be achieved.
The Statement of Additional Information dated November 1, 1998 has been filed
with the Securities and Exchange Commission and is incorporated by reference
into this Prospectus. You may obtain it, without charge, by writing to the Fund
or by calling 800-874-3733 and asking for "Part B of the Prospectus -- the
Statement of Additional Information." In addition, the Commission maintains a
website (http://www.sec.gov) that contains this Prospectus, the Statement of
Additional Information, other material incorpor ated by reference, and other
information regarding companies that file electronically with the Commission.
Shaded terms are defined in the "Glossary of Terms."
Like all mutual fund shares, 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
November 1, 1998
Lord Abbett
U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
Investors should read and retain this Prospectus. Shareholder inquiries should
be made in writing to the Fund or by calling 800-821-5129. In addition, you can
make inquiries through your broker-dealer.
Shares of the Fund are not deposits or obligations of, or guaranteed or endorsed
by, any bank, and the shares are not federally insured by the Federal Deposit
Insurance Corporation, the Federal Reserve Board, or any other agency. An
investment in the Fund involves risks, including the possible loss of principal.
TABLE OF CONTENTS PAGE
How We Invest 2
Portfolio Management 2
Investor Expenses 2
Financial Highlights 3
Purchases 4
Opening an Account 5
Shareholder Services 5
Redemptions 6
Dividends, Taxes and Yield 7
Our Management 8
Fund Performance 8
Glossary of Terms 8
It is the Fund's policy to maintain, and it has maintained, a constant net asset
value of $1.00 per share. However, an investment in the Fund is neither insured
nor guaranteed by the U.S. Government and there can be no assurance that we will
be able to maintain a stable net asset value of $1.00 per share.
<PAGE>
HOW WE INVEST
Under normal circumstances, we intend to invest at least 65% of our total assets
in U.S. Government Securities, Agencies and Instrumentalities eligible as
investments for a money market fund. Up to 35% of our total assets may be
invested in other High-Quality, Short-Term Securities.
Our investments must meet certain portfolio maturity, diversification and
quality requirements because we are a "money market fund" and use the
amortized cost method of valuing our portfolio securities. See "Net Asset
Value."
MATURITY. The maturity requirements limit dollar-weighted average portfolio
maturity to not more than 90 days and the maturity of any single portfolio
instrument to not more than 397 days.
DIVERSIFICATION. Generally speaking, with certain exceptions, including
Government Securities, the diversification requirements limit our investments as
follows: (i) the securities of any one issuer are limited to 5% of our total
assets, (ii) securities issued by or subject to puts from any single institution
are limited to 5% of our total assets, and (iii) securities that are neither
rated nor comparable in quality to securities that are rated in the highest
category are limited to 5% of our total assets.
QUALITY. We may invest only in securities that present minimal risks as
determined by the Board of Directors (or Lord, Abbett & Co. where delegable) and
that satisfy certain requirements relating to ratings by nationally-recognized
ratings organizations.
CONCENTRATION. No more than 25% of our total assets may
be invested in securities of any one industry, except there is no limitation on
investments in obligations issued or backed by the U.S. Government, its agencies
or instrumentalities.
We may enter into repurchase agreements with Federal Reserve member banks,
primary dealers in U.S. Government Securities and broker-dealers.
Repurchase agreements must be collateralized by money market securities,
may not exceed 30 days and must be marked daily to the repurchase price.
For more information about investment policies, restrictions and risk factors,
see the Statement of Additional Information.
PORTFOLIO MANAGEMENT
The Fund's investment decisions are made by Robert Gerber. Mr. Gerber is a
Partner of Lord Abbett and Executive Vice President and Portfolio Manager
of the Fund. He joined Lord Abbett in July 1997 as Director of High Grade
Fixed Income. Prior to joining Lord Abbett, Mr. Gerber served as a Senior
Portfolio Manager of Sanford C. Bernstein & Co., Inc. from 1992 to 1997.
INVESTOR EXPENSES
The expenses shown below are based on historical expenses for the fiscal year
ended June 30, 1998. Future expenses may be more or less than shown.
Class A Class B Class C
Shareholder Transaction Expenses
Maximum Sales Charge on Purchases
(as a % of offering price) None None None
Deferred Sales Charge(1)
(See "Purchases") None 5.00% None
Annual Fund Operating Expenses
(as a % of average net assets)
Management Fees (See "Our Management") .50% .50% .50%
12b-1 Fees(2) None .75% None
Other Expenses (See "Our Management") .33% .33% .33%
Total Operating Expenses .83% 1.58% .83%
Example: Assume an average annual return of 5% and no change in the level
of expenses. For a $1,000 investment with all dividends and distributions
reinvested, you would have paid the following total expenses, assuming
redemption at the end of each time period indicated.
Share Class Year 1 Year 3 Year 5 Year 10
Class A shares $8 $26 $46 $103
Class B shares(3) $56 $80 $96 $168
Class C shares $8 $26 $46 $103
You would pay the following expenses on the same investment, assuming no
redemption:
Class A shares $8 $26 $46 $103
Class B shares(3) $16 $50 $86 $168
Class C shares $8 $26 $46 $103
This example is for comparison and is not a representation of the Fund's actual
expenses and returns, either past or present.
(1) See "Purchases" for a description of sales charges, the Contingent Deferred
Sales Charge ("CDSC") payable on certain redemptions and separate Rule 12b-1
plans applicable to each class of shares.
(2) Because of the 12b-1 fees, long-term shareholders may indirectly pay more
than the equivalent of the maximum front-end sales charge permitted by the
National Association of Securities Dealers, Inc. While there are 12b-1 Plans for
Class A and C, they are currently inactive.
(3) Class B shares will automatically convert to Class A shares on the
eighth anniversary of your original purchase of Class B shares.
The purpose of the table is to assist you in understanding the various costs and
expenses that you will bear directly or indirectly as an investor in the Fund.
<PAGE>
FINANCIAL HIGHLIGHTS
The following table has been audited by Deloitte & Touche LLP,
independent accountants, in connection with their annual audit of the
Fund's Financial Statements, whose report thereon may be obtained on
request.
<TABLE>
<CAPTION>
Per Class A Share Operating Year Ended June 30,
Performance: 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $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 .047 .046 .048 .046 .025 .024 .038 .064 .077 .080
Less Distributions
Dividends from net investment income (.047) (.046) (.048) (.046) (.025) (.024) (.038) (.064) (.077) (.080)
Net asset value, end of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return(d) 4.79% 4.66% 4.85% 4.65% 2.54% 2.43% 3.87% 6.55% 8.01% 8.32%
Ratios/Supplemental Data:
Net assets, end of year (000) $162,631 $143,197 $152,531 $140,642 $156,069 $122,782 $147,229 $195,134 $195,547 $212,001
Ratios to Average Net Assets:
Expenses, including waiver 0.83% 0.84% 0.81% 0.86% 0.85% 0.87% 1.01% 0.95% 0.90% 0.87%
Expenses, excluding waiver 0.83% 0.84% 0.81% 0.86% 0.90% 0.96% 1.02% 0.95% 0.90% 0.87%
Net investment income 4.68% 4.57% 4.75% 4.54% 2.56% 2.41% 3.86% 6.40% 7.74% 8.02%
Per Class Share Operating Class B Shares Class C Shares
Performance: Year Ended August 1, 1996(a)(c) Year Ended July 15, 1996(a)
June 30, 1998 to June 30, 1997 June 30, 1998 to June 30, 1997
<S> <C> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00
Income from investment operations
Net investment income .039 .024 .047 .044
Less Distributions
Dividends from net investment income (.039) (.024) (.047) (.044)
Net asset value, end of period $1.00 $1.00 $1.00 $1.00
Total Return(d) 4.01% 2.39%(b) 4.79% 4.47%(b)
Ratios/Supplemental Data:
Net assets, end of year (000) $1,760 $244 $738 $791
Ratios to Average Net Assets:
Expenses 1.59% 0.99%(b) 0.84% 0.81%(b)
Net investment income 3.96% 2.38%(b) 4.73% 4.39%(b)
<FN>
(a) Commencement of offering Class B and Class C shares, respectively.
(b) Not annualized.
(c) November 15, 1996 commencement of operations.
(d) Total return assumes reinvestment of all distributions.
</FN>
</TABLE>
<PAGE>
PURCHASES
The Fund offers three classes of shares - Classes A, B and C. Our shares are
continuously offered at their net asset value (normally $1.00 per share). You
may purchase shares at the net asset value next determined after the Fund
accepts your purchase order submitted in proper form. Each class of shares
represents an investment in the same portfolio of securities but is subject to
different expenses and has different dividends and yields. Investors should read
this section carefully to determine which class of shares represents the best
investment option for their particular situation.
We reserve the right to withdraw all or any part of the offering made by this
Prospectus or to reject any purchase order. We also reserve the right to waive,
increase or establish minimum investment requirements. All purchase orders are
subject to our acceptance and are not binding until confirmed or accepted in
writing.
Class A - Purchased directly or acquired by exchange.
- -Offered without a sales charge.
- -Lower annual expenses than Class B shares.
Class B - Purchased directly or acquired by exchange.*
- -No front-end sales charge.
- -Higher annual expenses than Class A shares.
- -A contingent deferred sales charge is applied to shares sold prior to sixth
anniversary of purchase.
- -Automatically convert to Class A shares after eight years.
- -Asset-based sales charge 0.75 of 1%.
See "Class B Rule 12b-1 Plan."
*Class B shares of the Fund
may be purchased (i) directly by investors opening dollar cost averaging
accounts pursuant to which all of the amount invested will be reinvested in an
Eligible Fund within 24 months of the initial purchase and (ii) by exchange for
shares of the same class of any Eligible Fund.
Class C - Acquired by exchange only.
- -No front-end sales charge.
- -Lower annual expenses than Class B shares.
- -A contingent deferred sales charge is applied to shares sold prior to the
first anniversary of purchase.
CONTINGENT DEFERRED SALES CHARGE ("CDSC") If you
acquire shares through an exchange from another Lord Abbett-sponsored fund in
which a CDSC applies and you subsequently redeem them, the Fund will collect and
remit the CDSC to the fund in which you originally purchased the shares. The
CDSC will be remitted to Lord Abbett Distributor LLC ("Lord Abbett
Distributor"), in the case of Class B shares. The CDSC is based on the original
purchase cost or the current market value of the shares being sold, whichever is
less. There is no CDSC on shares acquired through reinvestment of dividends.
CLASS A SHARE CDSC. If you buy Class A shares, you pay no sales charge. If you
acquire Class A shares in exchange for Class A shares of another Lord
Abbett-sponsored fund subject to a CDSC and you redeem any of the Class A shares
within 24 months after the month in which you initially purchased shares of such
fund, the Fund will collect a CDSC of 1%.
CLASS B SHARE CDSC. The CDSC for Class
B shares normally applies if you redeem your shares before the sixth anniversary
of their initial purchase. The CDSC varies depending on how long you own your
shares as shown below.
Anniversary Contingent Deferred Sales
of the Day on Charge on Redemptions
Which the Purchase (As % of Amount
Order Was Accepted Subject to Charge)
On Before
1st 5.0%
1st 2nd 4.0%
2nd 3rd 3.0%
3rd 4th 3.0%
4th 5th 2.0%
5th 6th 1.0%
on or after the None
6th anniversary
CLASS B SHARE CDSC WAIVER.The CDSC will generally be waived under the following
circumstances:
- -death of the shareholder (natural person);
- -on redemptions of shares in connection with Div-Move and Systematic Withdrawal
Plans (up to 12% per year);
- -benefit payments such as Plan loans, hardship withdrawals,death, disability,
retirement, separation from service or any excess contribution or
distribution under Retirement Plans; and
- -Eligible Mandatory Distributions under 403(b) plans and Individual Retirement
Accounts.
See "Systematic Withdrawal Plan" for more information on CDSCs with respect to
Class B shares.
<PAGE>
CLASS C SHARE CDSC. The 1% CDSC for Class C shares normally
applies if you redeem your shares before the first anniversary of your original
purchase.
SALES COMPENSATION
Compensation payments originate from two sources: CDSCs and 12b-1 fees paid out
of the Fund's assets. The Fund is currently not making 12b-1 fee payments under
the Class A and Class C share Rule 12b-1 plans. However, Lord Abbett Distributor
pays an up-front payment to authorized institutions totaling 4%, consisting of
0.25% for service and 3.75% for a sales commission in connection with purchases
of Class B shares for dollar cost averaging accounts described above.
CLASS B RULE 12B-1 PLAN. The Fund has adopted a Class B share Rule 12b-1 plan
under which we periodically pay Lord Abbett Distributor an annual distribution
fee of 0.75 of 1% of the average daily net asset value of the Class B shares.
The distribution fee is paid to Lord Abbett Distributor to compensate it for
its services rendered in connection with the distribution of
Class B shares, including the payment and financing of sales
commissions on Class B shares at the time of their original purchase.
OPENING AN ACCOUNT
Minimum Initial Investment
Regular account $1,000 (Class A and C shares) and
$5,000 (Class B shares)
Individual Retirement Account (Traditional, Education and Roth),
403(b) and employer-sponsored retirement plans under
the Internal Revenue Code $250 (Class A and C shares)
$2,000 (Class B shares)
Invest-A-Matic and Div-Move $250 initial (Class A and C shares)
$50 subsequent minimum (Class A and C shares)
For Class B share minimums call the Fund at 800-821-5129
BY CHECK. To purchase Class A shares by mail, send the completed
attached Application Form, together with a check in U.S. dollars to:
Lord Abbett U.S. Government Securities
Money Market Fund, Inc.
P.O. Box 419576 u Kansas City, MO 64141
BY WIRE. Telephone the Fund to obtain an account number. You can then
instruct your bank to wire the amount of your investment to:
United Missouri Bank of Kansas City, N.A.
Tenth and Grand u Kansas City, MO 64141
Account # 980103352-2
ABA # 1010-0069-5
Specify the name of the Fund, your account number and the name(s) in which the
account is registered. Your bank may charge you a fee to wire funds. Wires
received prior to 12 noon Eastern Standard Time will receive the dividends for
that day. Otherwise, dividends will begin accruing on the next business day.
BY EXCHANGE. Telephone the Fund to request an exchange from any eligible
Lord Abbett-sponsored fund.
PROPER FORM. Your account will begin accruing dividends on the day on which your
purchase order is accepted by the Fund as being in proper form. To be in proper
form, an order submitted directly to the Fund must contain all information and
documentation required by the Application Form or supplementally by the Fund,
and payment must be credited by check in U.S. dollars to our custodian bank's
account. Checks drawn on foreign banks will not be credited to our custodian
bank's account unless cleared in U.S. dollars by a U.S. bank. For more
information regarding proper form of a purchase order, call the Fund at
800-821-5129.
SHAREHOLDER SERVICES
TELEPHONE EXCHANGES. You or your investment professional, with proper
identification, can instruct the Fund by telephone to exchange your Class A or B
shares, purchased directly, for the same shares of any Eligible Fund. Class C
shares may only be acquired by exchange for shares of the same class of any
Eligible Fund. Certain of the tax-free, single-state series may not be offered
in your state. Instructions must be received by the Fund in Kansas City by
calling 800-821-5129 before the close of the New York Stock Exchange ("NYSE") to
exchange at the net asset value on that day.
For your protection, telephone requests for exchanges are recorded.
We will take measures to verify the identity of the caller, such as asking for
your name, account number, Social Security or taxpayer identification number and
other relevant information. The Fund will not be liable for following
instructions communicated by telephone that it reasonably believes to be
genuine. Expedited exchanges by telephone may be difficult to implement in times
of drastic economic or market change.
<PAGE>
The exchange privilege should not be used to take advantage of
short-term swings in the market. The Fund reserves the right to limit
or terminate this privilege for any shareholder making frequent
exchanges and may revoke the privilege for all shareholders upon 60
days' prior written notice. You have this privilege unless you refuse
it in writing. You should read the prospectus of the other Lord
Abbett-sponsored fund(s) selected before making an exchange.
INVEST-A-MATIC. You can make fixed, periodic investments ($50
minimum investment) into an existing account in any Eligible Fund by
means of automatic money transfers from your bank checking account.
You should read the prospectus of the other fund before investing.
DIV-MOVE. You can
invest the dividends paid on your account ($250 initial and $50 subsequent
minimum) into any new or existing account, within the same class, in any
Eligible Fund. The account must be either your account, your joint account with
another, or a custodial account for your minor child.
SYSTEMATIC WITHDRAWAL PLAN ("SWP"). You can make periodic cash withdrawals from
your account which are automatically paid to you in fixed or variable
amounts. To participate, the value of your shares must be at least $10,000,
except for retirement plans for which there is no minimum.
With respect to Class B shares, the CDSC will be
waived on redemptions of up to 12% of the current net asset value of your
account at the time of your SWP request. For Class B share redemptions over 12%
per year, the CDSC will apply to the entire redemption. Please contact the Fund
for assistance in minimizing the CDSC in this situation.
Redemption proceeds due to a SWP for Class B (up to 12% per year) and Class C
shares, will be redeemed in the order described under "Redemptions."
RETIREMENT PLANS. The Lord Abbett
Family of Funds offers a range of qualified retirement plans, including IRAs
(Traditional, Education and Roth), SIMPLE IRAs, Simplified Employee Pension
Plans, 403(b) and pension and profit-sharing plans, including 401(k) plans. To
find out more about these plans, call the Fund at 800-253-7299.
SHARE CERTIFICATES. All shares are electronically recorded.
Certificated shares are no longer available for any Class of the Fund.
Account Changes. For any changes you need to make to your account,
consult your financial representative or call the Fund at
800-821-5129.
HOUSEHOLDING. Shareholders with the same last name and address
will receive one copy of annual or semi-annual reports, unless they
request additional reports in writing.
REDEMPTIONS. REGULAR PROCEDURE. To redeem
shares you must submit a written redemption request indicating your share class,
your account number, the name(s) in which the account is registered and the
dollar value or number of shares you wish to sell.
Include all necessary
signatures and any additional documents that may be required. If the signer has
any legal capacity, the signature and capacity must be guaranteed by an Eligible
Guarantor. Certain other legal documentation may be required. For more
information regarding proper documentation, telephone the Fund.
We will verify that the shares being redeemed were purchased more than
15 days earlier or were purchased by wire and represent an amount
sufficient to cover the amount being redeemed.
Normally a check will be mailed to the name(s) and address in which
the account is registered, or otherwise according to your instruction,
within one business day after receipt of your redemption request. The
Fund reserves the right to make payment within three business days.
EXPEDITED PROCEDURE. To be
eligible for this procedure, you must have filled out the "Expedited Telephone
Redemption" section of your Application Form. To verify whether the expedited
telephone redemption privilege is in place on an account, or to request an
Application Form to add it, or to change information for an existing account,
call your investment professional or the Fund.
Telephone the Fund at 800-821-5129 and ask for "Expedited
Redemptions." All proceeds will be paid to the same bank account
designated on your Application Form.
Amounts of $1,000 or more normally will be wired to the designated account on
the same day if your order is accep-ted before 12 noon Eastern Standard
Time or on the next business day if accepted after such time.
<PAGE>
Amounts of less than $1,000 normally will be
mailed by check on the next business day after your order is accepted.
To receive the dividend for the same day you sell, your
redemption order must be accepted after 12 noon Eastern Standard Time.
The Fund will not be liable for following instructions communicated by
telephone that it reasonably believes to be genuine.
CHECKWRITING. To be eligible for this privilege, you must have
filled out the "Checkwriting" section of your Application Form. To verify
whether the
checkwriting privilege is in place on an account, or to request an
Application Form to add it to an existing account, call your
investment professional or the Fund. You can write a check for no less
than $500 and no more than $5,000,000. Shares in an account of a
different class than those in the account on which the check is drawn
will not be redeemed to cover the check.
This privilege should not be used to close an account because you
earn dividends until the check clears.
To determine if a CDSC applies to a redemption, the Fund
redeems shares in the following order:
1 shares acquired by
reinvestment of dividends and capital gains;
2 shares held for six
years or more (Class B) or one year or more (Class C);
and 3 shares
held the longest before the sixth anniversary of their purchase (Class
B) or before the first anniversary of their purchase (Class C).
NET ASSET VALUE. The net asset value of each class of shares is calculated
at 12 noon and 2 p.m. Eastern Standard Time each day that the NYSE is
open for trading. Securities are valued at cost plus (minus) amortized
discount (premium), if any, pursuant to the requirements for money
market funds.
DIVIDENDS, TAXES AND YIELD
DIVIDENDS. Our net income
will be declared as a dividend to shareholders of record as of 12 noon
Eastern Standard Time on each day the NYSE is open for trading. Unless
you elect to receive cash, dividends will be reinvested in additional
shares on the monthly reinvestment date. If you elect cash, a check
will be mailed to you as soon as possible after the reinvestment date
or, if you arrange for direct deposit, your payment will be
electronically transferred directly to your bank account within two
days after the payable date.
If you redeem your entire account, all
dividends declared to the time of redemption will be paid to you.
TAXES. The Fund pays no federal income tax on the earnings it
distributes to shareholders. Consequently, dividends you receive from
the Fund, whether reinvested or taken in cash, are generally
considered taxable. Dividends declared in December of any year will be
treated for federal income tax purposes as having been received by
shareholders in that year if they are paid before February 1 of the
following year.
Each January you should receive, if applicable, a Form
1099 tax information statement detailing your dividends and their
federal tax category. You should consult your tax adviser concerning
applicable state and local taxes.
Shareholders may be subject to a $50
penalty under the Internal Revenue Code and we may be required to
withhold and remit to the U.S. Treasury a portion (31%) of any
redemption proceeds (including the value of shares exchanged into
another Lord Abbett-sponsored fund), and of any dividend or
distribution on any account if the payee failed to provide a correct
taxpayer identification number or to make certain required
certifications.
For more information about the tax consequences from
dividends and distributions, see the Statement of Additional
Information.
YIELD. The Fund's "yield" refers to the income generated
by an investment in the Fund over a seven-day period, which is then
annualized. The "effective yield" is calculated similarly but, when
annualized, the income earned is assumed to be reinvested and will
therefore be slightly higher. Both yield figures are based on
historical earnings and are not intended to indicate future
performance.
For the seven-day period ending June 30, 1998, the Class
A, B and C share yields were 4.59%, 3.84% and 4.59%, respectively. For
the same period, the effective yields for Class A, B and C shares were
4.70%, 3.92% and 4.70%, respectively. On that day, the portfolio's
dollar-weighted life to maturity was 33 days.
<PAGE>
Yield information is useful in reviewing the Fund's performance but,
because yields will fluctuate, such information may not provide a
basis for comparison with bank deposits and other investments that pay
a fixed yield for a stated period of time or with other investment
companies which may use a different method of computing yield.
OUR MANAGEMENT
The Fund is supervised by a board of directors, an independent body which has
ultimate responsibility for the Fund's activities. The board has retained
Lord Abbett as investment manager pursuant to a Management Agreement. Lord
Abbett has been an investment manager for over 69 years and currently
manages approximately $26 billion in a family of mutual funds and other
advisory accounts. Lord Abbett provides services to thirty-six mutual fund
portfolios having various investment objectives and also advises other
investment clients. For more information about the services Lord Abbett
provides to the Fund, see the Statement of Additional Information.
The Fund pays Lord Abbett a monthly fee based on average daily net assets for
each month. For the fiscal year ended June 30, 1998, the fee paid to Lord
Abbett was at an annual rate of 0.50 of 1%. In addition, the Fund pays all
expenses not expressly assumed by Lord Abbett.
The services provided to the Fund and its shareholders by Lord Abbett, Lord
Abbett Distributor, the Fund's transfer agent and the Fund's custodian
depend on the proper functioning of their computer systems and those of
their outside service providers. Many computer systems, and many imbedded
microprocessors now in use cannot distinguish between the year 2000 and the
year 1900, an inability that could disrupt the services provided to the
Fund. Lord Abbett, Lord Abbett Distributor, the Fund's transfer agent and
the Fund's custodian all have advised the Fund that they have been actively
working on changes to their computer systems to prepare for the year 2000
and expect that their systems, and those of their outside service
providers, will be adapted in time. However, because the year 2000 problem
is unprecedented, there can be no assurance that they will be successful.
Neither can there be any assurance that their services will not be impaired
by interactions with other computer systems that have not been adapted for
the year 2000.
In addition, it is possible that the markets for securities in
which the Fund invests may be detrimentally affected by computer and
microprocessor failures throughout the financial services industry
beginning January 1, 2000. Also, corporate and governmental data
processing errors may result in problems for individual companies and
may create overall economic uncertainties. Accordingly, the Fund's
investments may be adversely affected.
THE FUND. The Fund is a diversified open-end management investment company
established in 1979. Its Class A, B and C shares have equal rights as to
voting, dividends, assets and liquidation except for differences resulting
from certain class-specific expenses.
FUND PERFORMANCE During the past fiscal year which ended on June 30, 1998, we
sought investments that provided the highest yield, while attempting to
maintain the average maturity at approximately 30 days. In an effort to
preserve capital and maintain liquidity, we invested only in high-quality
U.S. Government Agency discount notes.
Your Fund's management team continues to focus on those areas we believe will
produce the highest available yields.
GLOSSARY OF TERMS
ELIGIBLE FUND: Any Lord
Abbett-sponsored fund, including "AAMF" (i.e., any authorized
institution's affiliated money market fund satisfying Lord Abbett
Distributor as to certain omnibus account and other criteria) except:
Lord Abbett Equity Fund, Lord Abbett Series Fund and certain tax-free,
single-state series where the exchanging shareholder is a resident of
a state in which such series is not offered for sale.
ELIGIBLE
GUARANTOR: Any member bank or broker that is a member of the medallion
stamp program.
ELIGIBLE MANDATORY DISTRIBUTIONS: If Class B shares
represent a part of an individual's total IRA or 403(b) investment,
the CDSC waiver is available only for that portion of a mandatory
distribution which bears the same relation to the entire mandatory
distribution as the B share investment bears to the total investment.
HIGH-QUALITY, SHORT-TERM SECURITIES: These securities include: (1)
Bank obligations (including certificates of deposit and banker's
acceptances) of U.S. banks and savings and loan associations which, at
the date of their latest public reporting, had total assets in excess
of $1 billion and capital, surplus and undivided profits in excess of
$100 million;
<PAGE>
(2) Commercial Paper (short-term unsecured promissory
notes of corporations, including variable amount master demand notes)
which at the date of investment are rated A-1 by Standard & Poor's
Corporation ("S&P") or P-1 by Moody's Investors Service, Inc.
("Moody's") or, if not rated, are issued by companies having
outstanding debt rated AAA or AA by S&P or Aaa or Aa by Moody's; and
(3) Corporate debt securities (bonds and debentures) with no more than
12 months remaining to maturity at date of settlement and rated AAA or
AA by S&P or Aaa or Aa by Moody's.
U.S. GOVERNMENT SECURITIES,
AGENCIES AND INSTRUMENTALITIES: These obligations, which must be
eligible investments for a money market fund, include (1) obligations
issued by the U.S. Treasury, differing only in their interest rates,
maturities and time of issuance, and including Treasury bills, notes
and bonds and (2) obligations issued or guaranteed by U.S. Government
agencies and instrumentalities which are supported by any of the
following: (a) the full faith and credit of the United States (such as
GNMA certificates), (b) the right of the issuer to borrow from the
U.S. Treasury or (c) the credit of the agency or instrumentality.
Agencies and instrumentalities include Federal Home Loan Banks,
Federal Home Loan Mortgage Association, Federal National Mortgage
Association, Federal Farm Credit Banks and Student Loan Marketing
Association.
This Prospectus does not constitute an offering in any
jurisdiction in which such offer is not authorized or in which the
person making such offer is not qualified to do so or to anyone to
whom it is unlawful to make such offer. No person is authorized to
give any information or to make any representations not contained in
this Prospectus or in supplemental sales material authorized by the
Fund and no person is entitled to rely upon any information or
representation not contained herein or therein.
Investment Manager and Distributor
Lord, Abbett & Co. and Lord Abbett Distributor LLC
The General Motors Building
767 Fifth Avenue
New York, New York 10153-0203
212-848-1800
Custodian, Transfer Agent and Dividend
Disbursing Agent
United Missouri Bank of Kansas City, N.A.
Tenth and Grand
Kansas City, Missouri 64141
Shareholder Servicing Agent
DST Systems, Inc.
P.O. Box 419576
Kansas City, Missouri 64141 800-821-5129 Auditors Deloitte & Touche LLP Counsel
Debevoise & Plimpton Printed in the U.S.A.
LAMM-1-1198
(11/98)
November 1, 1998
PROSPECTUS
Lord Abbett
U.S. Government
Securities Money
Market Fund, Inc.
<PAGE>
Statement of Additional Information November 1, 1998
Lord Abbett U.S. Government Securities Money Market Fund, Inc.
This Statement of Additional Information is not a Prospectus. A Prospectus may
be obtained from Lord Abbett Distributor LLC ("Lord Abbett Distributor") at The
General Motors Building, 767 Fifth Avenue, New York, New York 10153-0203. This
Statement relates to, and should be read in conjunction with, the Prospectus
dated November 1, 1998.
Lord Abbett U.S. Government Securities Money Market Fund, Inc. (sometimes
referred to as "we" or the "Fund") has 1,000,000,000 shares of authorized
capital stock consisting of three classes (A, B and C), $.001 par value. The
Board of Directors will allocate these authorized shares of capital stock among
the classes from time to time. Class A and B shares may be purchased directly
and may be acquired in exchange for shares of the same class of another Lord
Abbett- sponsored fund. Class C shares may be acquired only in exchange from
shares of the same class of another Lord Abbett-sponsored fund. See "Telephone
Exchange Privilege" for more information. All shares have equal noncumulative
voting rights and equal rights with respect to dividends, assets and
liquidation, except for certain class-specific expenses. They are fully paid and
nonassessable when issued and have no preemptive or conversion rights.
Rule 18f-2 under the Act provides that any matter required to be submitted, by
the provisions of the Act or applicable state law or otherwise, to the holders
of the outstanding voting securities of an investment company such as the Fund
shall not be deemed to have been effectively acted upon unless approved by the
holders of a majority of the outstanding shares of each class affected by such
matter. Rule 18f-2 further provides that a class shall be deemed to be affected
by a matter unless the interests of each class in the matter are substantially
identical or the matter does not affect any interest of such class. However, the
Rule exempts the selection of independent public accountants, the approval of
principal distributing contracts and the election of directors from its separate
voting requirements.
TABLE OF CONTENTS PAGE
1. Investment Policies 2
2. Yield Calculation 3
3. Directors and Officers 4
4. Investment Advisory and Other Services 8
5. Portfolio Transactions 9
6. Net Asset Value and Dividends 9
7. Telephone Exchange Privilege and Rule 12b-1 Plans 9
8. Class B Share Conversion Feature 11
9. Shareholder Programs and Retirement Plans 11
10. Commercial Paper and Bond Ratings 12
11. Taxes 14
12. Further Information About the Fund 14
13. Financial Statements 15
<PAGE>
1.
Investment Policies
FUNDAMENTAL INVESTMENT RESTRICTIONS
We are subject to the following investment restrictions which cannot be changed
without approval of a majority of our outstanding shares. The Fund may not: (1)
borrow money, except that (i) the Fund may borrow from banks (as defined in the
Investment Company Act of 1940, as amended (the "Act")) in amounts up to 33 1/3%
of its total assets (including the amount borrowed), (ii) the Fund may borrow up
to an additional 5% of its total assets for temporary purposes, (iii) the Fund
may obtain such short-term credit as may be necessary for the clearance of
purchases and sales of portfolio securities and (iv) the Fund may purchase
securities on margin to the extent permitted by applicable law; (2) pledge its
assets (other than to secure borrowings, or to the extent permitted by the
Fund's investment policies as permitted by applicable law); (3) engage in the
underwriting of securities, except pursuant to a merger or acquisition or to the
extent that, in connection with the disposition of its portfolio securities, it
may be deemed to be an underwriter under federal securities laws; (4) make loans
to other persons, except that the acquisition of bonds, debentures or other
corporate debt securities and investment in government obligations, commercial
paper, pass-through instruments, certificates of deposit, bankers acceptances,
repurchase agreements or any similar instruments shall not be subject to this
limitation, and except further that the Fund may lend its portfolio securities,
provided that the lending of portfolio securities may be made only in accordance
with applicable law; (5) buy or sell real estate, although the Fund may buy
short-term securities secured by real estate or interests therein, or issued by
companies which invest in real estate or interests therein, nor may the Fund buy
or sell commodities or commodity contracts, interests in oil, gas or other
mineral exploration or development programs; (6) with respect to 75% of the
gross assets of the Fund, buy securities of one issuer representing more than 5%
of the Fund's gross assets, except securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities; (7) invest more than 25% of its
assets, taken at market value, in the securities of issuers in any particular
industry (excluding U.S. Government securities as described in the Fund's
prospectus); (8) issue senior securities to the extent such issuance would
violate applicable law; or (9) buy common stocks or other voting securities.
With respect to the restrictions mentioned herein, compliance therewith will not
be affected by changes in the market value of portfolio securities but will be
determined at the time of purchase or sale of such securities.
NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. In addition to the investment
restrictions above which cannot be changed without shareholder approval, we also
are subject to the following non-fundamental investment policies which may be
changed by the Board of Directors without shareholder approval. The Fund may
not: (1) borrow in excess of 33 1/3% of its total assets (including the amount
borrowed), and then only as a temporary measure for extraordinary or emergency
purposes; (2) make short sales of securities or maintain a short position except
to the extent permitted by applicable law; (3) invest knowingly more than 15% of
its net assets (at the time of investment) in illiquid securities, except for
securities qualifying for resale under Rule 144A of the Securities Act of 1933,
deemed to be liquid by the Board of Directors; (4) invest in the securities of
other investment companies except as permitted by applicable law; (5) invest in
securities of issuers which, with their predecessors, have a record of less than
three years' continuous operations, if more than 5% of the Fund's total assets
would be invested in such securities (this restriction shall not apply to
mortgaged-backed securities, asset-backed securities or obligations issued or
guaranteed by the U. S. Government, its agencies or instrumentalities); (6) hold
securities of any issuer if more than 1/2 of 1% of the securities of such issuer
are owned beneficially by one or more officers or directors of the Fund or by
one or more partners or members of the Fund's underwriter or investment adviser
if these owners in the aggregate own beneficially more than 5% of the securities
of such issuer; (7) invest in warrants if, at the time of the acquisition, its
investment in warrants, valued at the lower of cost or market, would exceed 5%
of the Fund's total assets (included within such limitation, but not to exceed
2% of the Fund's total assets, are warrants which are not listed on the New York
or American Stock Exchange or a major foreign exchange); (8) write, purchase or
sell puts, calls, straddles, spreads or combinations thereof, except to the
extent permitted in the Fund's prospectus and statement of additional
information, as they may be amended from time to time; or (9) buy from or sell
to any of its officers, directors, employees, or its investment adviser or any
of its officers, directors, partners or employees, any securities other than
shares of the Fund's common stock.
OTHER INVESTMENT POLICIES
U.S. GOVERNMENT OBLIGATIONS. Direct U.S. Government obligations are issued by
the U.S. Treasury and include bills, certificates of indebtedness, notes and
bonds. U.S. agency obligations are issued by agencies established under the
authority of an act of Congress including, but not limited to, the Bank for
Cooperatives, Federal Home Loan Banks and Federal Intermediate Credit Banks.
CERTIFICATES OF DEPOSIT. Certificates of deposit are certificates issued in
consideration for funds deposited in a bank or savings and loan association.
They are for a definite period of time, earn a specified rate of return and are
negotiable. Banker's acceptances are short-term credit instruments primarily
used to finance the import, export, transfer or storage of goods. They are
termed "accepted" when a bank guarantees their payment at maturity.
VARIABLE AMOUNT MASTER DEMAND NOTES. Variable Amount Master Demand Notes are
demand obligations that permit the investment of fluctuating amounts at varying
market rates of interest pursuant to arrangements between the issuer and a
commercial bank acting as agent for the payees of such notes; each party has the
right to vary the amount of the outstanding indebtedness of the notes.
REPURCHASE AGREEMENTS. Repurchase agreements are instruments under which the
purchaser (i.e., the Fund) acquires the obligation (debt security) and the
seller agrees, at the time of the sale, to repurchase the obligation at a
mutually agreed upon time and repurchase price, thereby determining the yield
during the purchaser's holding period. These result in fixed rates of return
insulated from market fluctuation during such period. The underlying securities
will consist only of securities in which the Fund may otherwise invest and their
value will be marked to market daily to ensure that such value is at least equal
to the repurchase price (including accrued interest). Repurchase agreements
usually are for short periods. In the event of bankruptcy or other default by
the seller, the Fund would be subject to possible risks such as delays and
expenses in liquidating the underlying securities, decline in value of the
underlying securities and loss of interest. To minimize any such risk, the
creditworthiness of entities with whom we enter into repurchase agreements is
carefully evaluated by our investment manager, Lord Abbett.
2.
Yield Calculation
Each Class calculates its "yield" and "effective yield" based on the number of
days in the period for which the calculation is made ("base period"). Each
Class' "yield" is computed by determining the net change for the base period
(exclusive of capital changes) in the value of a hypothetical preexisting
account having a balance of one share at the start of the base period and
subtracting this value from the value of the account at the end of the base
period and dividing the result by the account's beginning value to come up with
a "base period return" which is then multiplied by 365 over the number of days
in the base period. "Effective yield" is determined by compounding the "base
period return" by adding one, raising the sum to a power equal to 365 divided by
the number of days in the base period and subtracting one from the result. An
example follows for the seven-day period ended June 30, 1998 of the calculation
of both "yield" and "effective yield" for one Class A share:
Value of hypothetical account with
exactly one share at beginning of
base period $ 1.000000000
Value of same account at end of base
period $ 1.000880274
Net change in account value $ .000880274
Base period return (net change in
account value divided by the
beginning account value) .0880274%
"Yield" [base period return
times (365 divided by 7)] 4.59%
"Effective yield" [(base period
return + 1) 365/7] - 1 4.70%
On June 30, 1998, our portfolio had a dollar-weighted life to maturity of 33
days.
Publishing of the annualized yield for a given period provides investors with a
basis for comparing our yield with that of other investment vehicles. However,
yields of other investment vehicles may not always be comparable because of
different methods of calculating yield. In addition, the safety and yield of the
Fund and other money market funds are a function of portfolio quality, portfolio
maturity and operating expenses, while the yields on competing bank accounts are
established by the bank and their principal is generally insured.
Each Class' yield is not fixed. It fluctuates and the annualization of a yield
rate is not a representation by the Class as to what an investment in the Class
will actually yield for any given period. Actual yields will depend not only on
changes in interest rates on money market instruments during the course of the
period in which the investment in the Class is held, but also on such matters as
any realized and unrealized gains and losses, changes in the expenses of the
Class during the period and on the relative amount of new money coming into the
Class which has to be invested at a different yield than that represented by
existing assets.
3.
Directors and Officers
The following director is a partner of Lord, Abbett & Co., The General Motors
Building, 767 Fifth Avenue, New York, New York 10153-0203. He has been
associated with Lord Abbett for over five years and is also an officer, director
or trustee of the twelve other Lord Abbett-sponsored funds. He is an "interested
person" as defined in the Act, and as such, may be considered to have indirect
financial interests in the Rule 12b-1 Plan described in the Prospectus.
Robert S. Dow, age 53, Chairman and President
The following outside trustees are also directors or trustees of some or all of
the twelve other Lord Abbett-sponsored funds referred to above.
E. Thayer Bigelow
Courtroom Television Network
600 Third Avenue
New York, New York
Formerly President and Chief Executive Officer of Time Warner Cable
Programming, Inc. Prior to that, formerly President and Chief Operating Officer
of Home Box Office, Inc. Age 57.
William H. T. Bush
Bush-O'Donnell & Co., Inc.
101 South Hanley Road, Suite 1025
St. Louis, Missouri
Co-founder and Chairman of the Board of financial advisory firm of
Bush-O'Donnell & Company. Age 60.
Robert B. Calhoun
Monitor Clipper Partners
650 Madison Avenue, 9th Floor
New York, New York
Managing Director of Monitor Clipper Partners and President of The Clipper Group
L.P., both private equity investment funds. Age 57.
Stewart S. Dixon
Wildman, Harrold, Allen & Dixon
225 W. Wacker Drive (Suite 2800)
Chicago, Illinois
Partner in the law firm of Wildman, Harrold, Allen & Dixon. Age 67.
John C. Jansing
162 S. Beach Road
Hobe Sound, Florida
Retired. Former Chairman of Independent Election Corporation of America, a
proxy tabulating firm. Age 72.
C. Alan MacDonald
Directorship, Inc.
8 Sound Shore Drive
Greenwich, Connecticut
Managing Director of Directorship Inc., a consultancy in board management and
corporate governance. Formerly General Partner of The Marketing Partnership,
Inc., a full service marketing consulting firm (1994 - 1997). Prior to that,
Chairman and Chief Executive Officer of Lincoln Snacks, Inc., manufacturer of
branded snack foods (1992 - 1994). His career spans 36 years at Stouffers and
Nestle with 18 of the years as Chief Executive Officer. Currently serves as
Director of DenAmerica Corp., J.B. Williams Company, Inc., Fountainhead Water
Company and Exigent Diagnostics. Age 65.
Hansel B. Millican, Jr.
President & CEO
The Rochester Button Co.
1328 Broadway (Suite 816)
New York, New York 10001
President and Chief Executive Officer of Rochester Button Company. Age 70.
Thomas J. Neff
Spencer Stuart
277 Park Avenue
New York, New York
Chairman of Spencer Stuart, an executive search consulting firm. Currently,
serves as Director of Ace Ltd. (NYSE). Age 61.
The second column of the following table sets forth the compensation accrued for
the Fund's outside directors. The third column sets forth information with
respect to the equity-based benefits accrued for outside directors by the Lord
Abbett-sponsored funds. The fourth column sets forth the total compensation
payable by such funds to the outside directors. No director of the Fund
associated with Lord Abbett and no officer of the Fund received any compensation
from the Fund for acting as a director or officer.
For the Fiscal Year Ended June 30, 1998
(1) (2) (3) (4)
For Year Ended
Equity-Based December 31, 1997
Benefits Accrued Total Compensation
Aggregate by the Fund and Accrued by the Fund
Compensation all other Lord and all other Lord
Accrued by Abbett-sponsored Abbett-sponsored
Name of Director the Fund1 Funds2
Funds3
E. Thayer Bigelow $461 $17,068 $56,000
William H. T. Bush* None None None
Robert B. Calhoun** $49 None None
Stewart S. Dixon $450 $32,190 $55,000
John C. Jansing $448 $45,0854 $55,000
C. Alan MacDonald $459 $30,703 $57,400
Hansel B. Millican, Jr. $448 $37,747 $55,000
Thomas J. Neff $455 $19,853 $56,000
* Elected director, June 17, 1998, effective as of August 13, 1998.
** Elected director, May 5, 1998, effective as of June 17, 1998.
1.Outside directors' fees, including attendance fees for board and committee
meetings, are allocated among all Lord Abbett-sponsored funds based on the
net assets of each fund. A portion of the fees payable by the Fund to its
outside directors/trustees is being deferred under a plan that deems the
deferred amounts to be invested in shares of the Fund for later distribution
to the directors/trustees so that each trustee's compensation depends in part
on the performance of the Fund.
2.The amounts in Column 3 were accrued by the Lord Abbett-sponsored Funds for
the 12 months ended June 30, 1998 with respect to the equity based plans
established for independent directors/trustees in 1996. This plan supercedes
a previously approved retirement plan for all future directors/trustees.
Current directors had the option to convert their accrued benefits under the
retirement plan. All of the outside directors except one made such an
election. Each plan also provides for a pre-retirement death benefit and
actuarially reduced joint-and-survivor spousal benefits.
3. This column shows aggregate compensation, including directors fees and
attendance fees for board and committee meetings, of a nature referred to in
footnote one, accrued by the Lord Abbett-sponsored funds during the year
ended December 31, 1997. The amounts of the aggregate compensation payable by
the Fund as of June 30, 1998 deemed invested in Fund shares, including
dividends reinvested and changes in net asset value applicable to such deemed
investments, were: Mr. Bigelow, $2,245; Mr. Calhoun, $49; Mr. Dixon, $10,788;
Mr. Jansing, $25,182; Mr. MacDonald, $9,993; Mr. Millican, $25,566 and Mr.
Neff, $25,796. If the amounts deemed invested in Fund shares were added to
each director's actual holdings of Fund shares as of June 30, 1998, each
would own the following: Mr. Bigelow, 0 shares; Mr. Dixon, 769.690 shares;
Mr. Jansing, 0 shares; Mr. MacDonald, 1,149.820 shares; Mr.
Millican, 0 shares; and Mr. Neff, 2,303.480 shares.
4. Mr. Jansing chose to continue to receive benefits under the retirement plan,
which provides that outside directors/ trustees may receive annual retirement
benefits for life equal to their final annual retainer following retirement
at or after age 72 with at least ten years of service. Thus, if Mr. Jansing
were to retire and the annual retainer payable by the funds were the same as
it is today, he would receive annual retirement benefits of $50,000.
Except where indicated, the following executive officers of the Fund have been
associated with Lord Abbett for over five years. Of the following, Messrs.
Brown, Carper, Gerber, Hilstad, Morris, and Walsh are partners of Lord Abbett;
the others are employees:
Executive Vice President: Robert Gerber, age 44, Executive Vice President
(with Lord Abbett since July 1997; formerly Senior Portfolio Manager of Sanford
C. Bernstein & Co., Inc.);
Vice Presidents:
Zane E. Brown, age 46
Daniel E. Carper, age 46
Paul A. Hilstad, age 55, Vice President and Secretary (with Lord Abbett since
1995; formerly Senior Vice President and General Counsel of American Capital
Management & Research, Inc.)
Lawrence Kaplan, age 41, (with Lord Abbett since 1997 - formerly Vice President
and Chief Counsel of Salomon Brothers Asset Management Inc from 1995 to 1997,
prior thereto Senior Vice President, Director and General Counsel of Kidder
Peabody Asset Management, Inc.)
Thomas F. Konop, age 56
Robert G. Morris, age 53
A. Edward Oberhaus, III, age 38
Keith O'Connor, age 43
John J. Walsh, age 60
Treasurer:
Donna M. McManus, age 37, Treasurer (with Lord Abbett since 1996, formerly a
Senior Manager at Deloitte & Touche LLP)
The Fund's By-Laws provide that the Fund shall not hold an annual meeting of its
stockholders in any year unless one or more matters are required to be acted on
by stockholders under the Act, as amended (the "Act"), or unless called by a
majority of the Board of Directors or by stockholders holding at least one
quarter of the stock of the Fund outstanding and entitled to vote at the
meeting. When any such annual meeting is held, the stockholders will elect
directors and vote on the approval of the independent auditors of the Fund.
As of September 30, 1998, our directors and officers, as a group, owned less
than 1% of our outstanding shares.
4.
Investment Advisory and Other Services
As described under "Our Management" in the Prospectus, Lord Abbett is the
Fund's investment manager. Seven of the seventeen general partners of Lord
Abbett are officers and/or directors of the Fund and are identified as follows:
Zane E. Brown, Daniel E. Carper, Robert S. Dow, Robert I. Gerber, Paul A.
Hilstad, Robert G. Morris, and John J. Walsh.
The other general partners who are neither officers/nor directors of the
Fund are Stephen Allen, John E. Erard, Robert P. Fetch, Daria L. Foster, W.
Thomas Hudson, Stephen J. McGruder, Michael B. McLaughlin, Robert J. Noelke, R.
Mark Pennington, and Christopher J. Towle. The address of each partner is The
General Motors Building, 767 Fifth Avenue, New York, New York 10153-0203.
The services performed by Lord Abbett are described under "Our Management" in
the Prospectus. Under the Management Agreement we pay Lord Abbett a monthly fee,
based on average daily net assets for each month, at the annual rate of .50 of
1% of the portion of our net assets not in excess of $250,000,000, .45 of 1% of
such assets in excess of $250,000,000 but not in excess of $500,000,000 and .40
of 1% of such assets over $500,000,000. This fee is allocated among Classes A, B
and C based on each class' proportionate share of such average daily net assets.
For the fiscal years ended June 30, 1998, 1997 and 1996, the management fees
paid to Lord Abbett amounted to $740,978, $773,869, and $748,926, respectively.
We pay all expenses not expressly assumed by Lord Abbett, including, without
limitation, 12b-1 expenses, outside directors' fees and expenses, association
membership dues, legal and auditing fees, taxes, transfer and dividend
disbursing agent fees, shareholder servicing costs, fees and expenses of
registering our shares under federal and state securities laws, expenses of
preparing, printing and mailing prospectuses to existing shareholders, insurance
premiums, brokerage and other expenses connected with executing portfolio
security transactions expenses.
We have agreed with the State of California to limit operating expenses
(including management fees but excluding taxes, interest, extraordinary expenses
and brokerage commissions) to 2 1/2% of average annual net assets up to
$30,000,000, 2% of the next $70,000,000 of such assets and 1 1/2% of such assets
in excess of $100,000,000. The expense limitation is a condition on the
registration of investment company shares for sale in California and applies so
long as our shares are registered for sale in that State.
Deloitte & Touche LLP, Two World Financial Center, New York, New York 10281, are
the independent auditors of the Fund and must be approved at least annually by
our Board of Directors to continue in such capacity. They perform audit services
for the Fund including the examination of financial statements included in our
annual report to shareholders.
United Missouri Bank of Kansas City, N.A., Tenth and Grand, Kansas City,
Missouri, is the Fund's custodian. The custodian pays for and collects proceeds
of securities bought and sold by the Fund and attends to the collection of
principal and income.
5.
Portfolio Transactions
We expect that purchases and sales of portfolio securities usually will be
principal transactions. Portfolio securities normally will be purchased directly
from the issuer or from an underwriter or market maker for the securities. We
usually will pay no brokerage commissions for such purchases and no brokerage
commissions have been paid over the last three fiscal years. Purchases from
underwriters of portfolio securities will include a commission or concession
paid by the issuer to the underwriter and purchases from dealers serving as
market makers will include a dealer's markup. Decisions as to the purchase and
sale of portfolio securities are made by Lord Abbett. Our traders, who may be
officers of the Fund and are also employees of Lord Abbett, implement these
decisions. They do the trading as well for other accounts--investment companies
(of which they are also officers) and other clients-managed by Lord Abbett. They
are responsible for the negotiation of prices and commissions.
Our policy is to have purchases and sales of portfolio securities executed at
the most favorable prices, considering all costs of the transaction, including
brokerage commissions and dealer markups and markdowns, consistent with
obtaining best execution. This policy governs the selection of dealers. We make
no commitments regarding the allocation of brokerage business to or among
broker-dealers.
6.
Net Asset Value and Dividends
NET ASSET VALUE. The determination of our net asset value is described
under "Redemptions" - Net Asset Value - in the Prospectus.
As disclosed in the Prospectus, we calculate our net asset value, declare
dividends and otherwise are open for business on each day that the New York
Stock Exchange (the "NYSE") is open for trading. The NYSE is closed on Saturdays
and Sundays and the following holidays: New Year's Day, Martin Luther King, Jr.
Day, President's Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
We attempt to maintain a net asset value of $1.00 per share for all classes for
purposes of sales and redemptions but there is no assurance that we shall be
able to do so. Although we have received an exemptive order from the Securities
and Exchange Commission which permits us to round our net asset value per share
to the nearest cent for such purpose, our Board of Directors has determined that
it is in the best interests of the Fund and its shareholders to value our
portfolio securities under the amortized cost method of securities valuation
pursuant to Rule 2a-7 under the Act so long as that method fairly reflects the
Fund's market-based net asset value. Rule 2a-7, as amended, contains certain
maturity, diversification and quality requirements that apply to any fund
employing the amortized cost method in reliance on the Rule and to any
registered investment company which, like the Fund, holds itself out as a money
market fund.
DIVIDENDS. As described in the Prospectus under "Dividends, Taxes and Yield,"
our net income will be declared as a dividend daily. Net income consists of (1)
all interest income and discount earned (including original issue discount and
market discount) less (2) a provision for all expenses, including class-specific
expenses, plus or minus (3) all short-term realized gains and losses on
portfolio assets.
7.
Telephone Exchange Privilege and
Rule 12b-1 Plans
TELEPHONE EXCHANGE PRIVILEGE. Shares of any class of the Fund may be exchanged
for those in the same class of (a) any other Lord Abbett-sponsored fund except
for (i) Lord Abbett Equity Fund ("LAEF"), Lord Abbett Series Fund ("LASF") and
(ii) certain single-state tax-free series and funds where the exchanging
shareholder is a resident of a state in which such series or fund is not offered
for sale, and (b) any authorized institution's affiliated money market fund
satisfying Lord Abbett Distributor as to certain omnibus account and other
criteria, hereinafter referred to as an "authorized money market fund" or
"AMMF." Class C shares of the Fund may be acquired only by exchange for shares
in the same class of any eligible Lord Abbett-sponsored fund or AMMF. Class A
and B shares of the Fund may be acquired either by such an exchange or by direct
purchase.
You or your investment professional, with proper identification, can instruct
the Fund to exchange by telephone. All shareholders have this privilege unless
they refuse it in writing. Exchanges for shares any eligible Lord
Abbett-sponsored fund or AMMF will be based on the relative net asset values of
the shares exchanged, without a sales charge in most cases. Class A shares
purchased directly from the Fund may be exchanged for Class A, B or C shares of
an eligible Lord Abbett-sponsored fund. Therefore, a sales charge will be
payable on exchanges for shares of any eligible fund in the Lord Abbett Family
of Funds in accordance with the prospectus of that fund if the Class A shares
being exchanged were purchased directly from the Fund (not including shares
described under "Div-Move" below). Instructions for the exchange must be
received by the Fund in Kansas City prior to the close of the NYSE to obtain the
other fund's net asset value per share calculated on that day. Securities
dealers may charge for their services in expediting exchange transactions.
Before making an exchange you should read the prospectus of the other fund which
is available from your securities dealer or Lord Abbett Distributor. An
"exchange" is effected through the redemption of Fund shares and the purchase of
shares of such other Lord Abbett-sponsored fund or AMMF. Exercise of the
exchange privilege will be treated as a sale for federal income tax purposes,
and, depending on the circumstances, a capital gain or loss may be recognized.
This privilege may be modified or terminated at any time.
You should not view the exchange privilege as a means for taking advantage of
short-term swings in the market and the Fund reserves the right to terminate or
limit the privilege of any shareholder who makes frequent exchanges.
RULE 12B-1 PLANS. The Fund is not making payments of Rule 12b-1 fees for its
Class A share Rule 12b-1 Plan ("A Plan") and its Class C share Rule 12b-1 Plan
("C Plan"). The Fund is making annual distribution fee payments (0.75 of 1% of
the average daily net asset value of the Class B shares that are outstanding for
less than 8 years) pursuant to its Class B share Rule 12b-1 Plan ("B Plan"). As
described in the Fund's current Prospectus, the Fund has adopted a Distribution
Plan and Agreement pursuant to Rule 12b-1 under the Act for each Class. In
adopting each Plan and in approving its continuance, the Board of Directors has
concluded that based on information requested by the Board and provided by Lord
Abbett, there is a reasonable likelihood that each Plan will benefit the Class
and its shareholders. The expected benefits include (in the case of the Class B
Plan) greater sales and lower redemptions of Class B shares and (in the case of
the Class A and C Plan) a higher quality of service to shareholders by dealers
than otherwise would be the case. Lord Abbett is to use all amounts received
under each Plan for payments to dealers for (i) providing continuous services to
each Class' shareholders (in the case of the A and C Plans), such as answering
shareholder inquiries, maintaining records, and assisting shareholders in making
redemptions, transfers, additional purchases and exchanges and (ii) their
assistance in distributing Class B shares (in the case of the B Plan).
Each Plan requires the Board of Directors to review, on a quarterly basis,
written reports of all amounts expended pursuant to the Plan and the purposes
for which such expenditures were made. Each Plan shall continue in effect only
if its continuance is specifically approved at least annually by vote of the
Board of Directors and of the Fund's directors who are not interested persons of
the Fund and who have no direct or indirect financial interest in the operation
of the Plan or in any agreements related to the Plan ("outside directors"), cast
in person at a meeting called for the purpose of voting on such Plan. Each Plan
may not be amended to increase materially the amount spent for distribution
expenses without approval by a majority of the Fund's directors, including a
majority of the outside directors. Each Plan may be terminated at any time by
vote of a majority of the Fund's outside directors or by vote of the holders of
a majority of the appropriate Class' outstanding voting securities.
As stated in the Prospectus, a contingent deferred sales charge ("CDSC") is
imposed with respect to those shares of the Fund bought in exchange for shares
of another Lord Abbett-sponsored fund or series on which the other fund has paid
a 12b-1 fee if such shares are redeemed out of the Fund (a) within a period of
24 months from the end of the month in which the original sale occurred in the
case of Class A shares acquired in exchange for shares in the same class of a
fund in the Lord Abbett Family of Funds or (b) within 6 years of their original
purchase in the case of Class B shares, or (c) within a period of 12 months from
the end of the month in which the original sale occurred in the case of Class C
shares.
As described in the Prospectus, in no event will the amount of the CDSC exceed
1% in the case of Class A and C shares or 5% scaled down to 1%, in the case of
Class B shares, of the lesser of (i) the net asset value of the shares redeemed
or (ii) the original cost of the shares for which such shares were exchanged
("Exchanged Shares"). No CDSC will be imposed when the investor redeems (i)
amounts derived from increases in the value of the account above the total cost
of shares being redeemed due to increases in net asset value, regardless of
whether this increase is reflected in reinvested dividends or distributions, in
the case of Class A shares, and due to such an increase because of reinvested
dividends and capital gains, in the case of Class B and C shares, (ii) shares
with respect to which no Lord Abbett fund paid a 12b-1 fee or (iii) shares
which, together with Exchanged Shares, have been held continuously (a) for 24
months from the end of the month in which the original sale occurred in the case
of Class A shares, (b) until the 6th anniversary of their original purchase in
the case of Class B shares and (c) until the 1st anniversary of their original
purchase in the case of Class C shares. In determining whether a CDSC is
payable, (a) shares not subject to the CDSC will be redeemed before shares
subject to the CDSC and (b) of shares subject to a CDSC, those held the longest
will be the first to be redeemed.
8.
Class B Share Conversion Feature
The conversion of Class B shares on the eighth anniversary of their purchase is
subject to the continuing availability of a private letter ruling from the
Internal Revenue Service, or an opinion of counsel or tax advisor, to the effect
that the conversion of Class B shares does not constitute a taxable event for
the holder under Federal income tax law. If such revenue ruling or opinion is no
longer available, the automatic conversion feature may be suspended, in which
event no further conversions of Class B shares would occur while such suspension
remained in effect. Although Class B shares could then be exchanged for Class A
shares on the basis of relative net asset value of the two classes, without the
imposition of a sales charge or fee, such exchange could constitute a taxable
event for the holder.
9.
Shareholder Programs and Retirement Plans
We have several programs available. These include automatic subsequent
investments of $50 or more from your checking account, a systematic withdrawal
plan, cash payments of monthly dividends to a designated third party and
expedited exchanges among the Lord Abbett-sponsored funds. Forms are available
from the Fund or Lord Abbett.
DIV-MOVE. Under the Div-Move service described in the Prospectus, you can invest
the dividends paid on your account into an existing account in any other
Eligible Fund. The account must be either your account, a joint account for you
and your spouse, a single account for your spouse, or a custodial account for
your minor child under the age of 21. You should read the prospectus of the
other fund before investing.
INVEST-A-MATIC. The Invest-A-Matic method of investing in the Fund and/or any
other Eligible Fund is described in the Prospectus. To avail yourself of this
method you must complete the application form, selecting the time and amount of
your bank checking account withdrawals and the funds for investment, include a
voided, unsigned check and complete the bank authorization.
SYSTEMATIC WITHDRAWAL PLAN. The Systematic Withdrawal Plan (the "SWP") also is
described in the Prospectus. You may establish a SWP if you own or purchase
uncertificated shares having a current offering price value of at least $10,000.
Lord Abbett prototype retirement plans have no such minimum. The SWP involves
the planned redemption of shares on a periodic basis by receiving either fixed
or variable amounts at periodic intervals. With respect to Class B shares, the
CDSC will be waived on redemptions of up to 12% per year of the current net
asset value of your account at the time your SWP is established. Since the value
of shares redeemed may be more or less than their cost, gain or loss may be
recognized for income tax purposes on each periodic payment. The SWP may be
terminated by you or by us at any time by written notice.
RETIREMENT PLANS. The Prospectus indicates the types of retirement plans for
which Lord Abbett provides forms and explanations. Lord Abbett makes available
the retirement plan forms and custodial agreements for IRAs (Individual
Retirement Accounts, including Traditional, Education, Roth, Simplified Employee
Pension Plans and Simple IRA's), 403(b) plans and qualified pension and
profit-sharing plans, including 401(k) plans. The forms contain specific
information about the plans. Explanations of the eligibility requirements,
annual custodial fees and allowable tax advantages and penalties are set forth
in the relevant plan documents. Adoption of any of these plans should be on the
advice of your legal counsel or qualified tax adviser.
REDEMPTIONS. A redemption order is in proper form when it contains all of the
information and documentation required by the order form or supplementally by
Lord Abbett Distributor or the Fund to carry out the order. The signature(s) and
any legal capacity of the signer(s) must be guaranteed by an eligible guarantor.
See the Prospectus for expedited redemption procedures.
The right to redeem and receive payment, as described in the Prospectus, may be
suspended if the NYSE is closed (except for weekends or customary holidays),
trading on the NYSE is restricted or the Securities and Exchange Commission
deems an emergency to exist.
Our Board of Directors may authorize redemption of all of the shares in any
account in which there are fewer than 500 shares. Before authorizing such
redemption, the Board must determine that it is in our economic best interest or
necessary to reduce disproportionately burdensome expenses in servicing
shareholder accounts. At least 60 days' prior written notice will be given
before any such redemption, during which time shareholders may avoid redemption
by bringing their accounts up to the minimum set by the Board.
10.
Commercial Paper and Bond Ratings
Commercial Paper Ratings
The rating A-1+ is the highest commercial paper rating assigned by Standard &
Poor's Corporation ("S&P"). Paper rated A-1 has the following characteristics:
Liquidity ratio is adequate to meet cash requirements; long-term senior debt is
rated A or better; the issuer has access to diverse channels of borrowing; core
earnings and cash flow have an upward trend with allowance made for unusual
circumstances; typically, the issuer's industry is well established and the
issuer has a strong position within the industry; the reliability and quality of
management are sound. Those issues determined to possess overwhelming safety
characteristics will be denoted with a plus (+) sign designation.
The rating P-1 is the highest commercial paper rating assigned by Moody's
Investors Service, Inc. ("Moody's"). Among the factors considered by Moody's in
assigning ratings are the following: (1) evaluation of the management of the
issuer; (2) economic evaluation of the issuer's industry or industries and an
appraisal of speculative-type risks which may be inherent in certain areas; (3)
evaluation of the issuer's products in relation to competition and customer
acceptance; (4) liquidity; (5) amount and quality of long-term debt; (6) trend
of earnings over a period of ten years; (7) financial strength of parent company
and the relationships which exist with the issuer; and (8) recognition by the
management of obligations which may be present or may arise as a result of
public interest questions and preparations to meet such obligations.
Bond Ratings
MOODY'S INVESTORS SERVICE, INC.'S CORPORATE BOND RATINGS
Aaa - Bonds rated Aaa are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt edge."
Interest payments are protected by a large or by an exceptionally stable margin
and principal is secure. While the various protective elements are likely to
change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.
Aa - Bonds rated Aa are judged to be of high-quality by all standards. Together
with the Aaa group they comprise what are generally known as high grade bonds.
They are rated lower than the best bonds because margins of protection may not
be as large as in Aaa securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make the
long-term risks appear somewhat larger than in Aaa securities.
A - Bonds rated A possess many favorable investment attributes and are to be
considered as upper medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.
Baa - Bonds rated Baa are considered as medium-grade obligations, i.e., they are
neither highly protected nor poorly secured. Interest payments and principal
security appear adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great length of time.
Such bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
Ba - Bonds rated Ba are judged to have speculative elements; their future cannot
be considered as well assured. Often the protection of interest and principal
payments may be very moderate and thereby not well safeguarded during both good
and bad times over the future. Uncertainty of position characterizes bonds in
this class.
B - Bonds rated B generally lack characteristics of a desirable investment.
Assurance of interest and principal payments or of maintenance of other terms of
the contract over any long period of time may be small.
Caa - Bonds rated Caa are of poor standing. Such issues may be in default or
there may be present elements of danger with respect to principal or interest.
Ca - Bonds rated Ca represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked shortcomings.
C - Bonds rated C are the lowest rated class of bonds, and issues so rated can
be regarded as having extremely poor prospects of ever attaining any real
investment standing.
STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS
AAA - This is the highest rating assigned by Standard & Poor's. The obligor's
capacity to meet its financial commitment on the obligation is extremely strong.
AA - Bonds rated AA differ form the highest rated obligations only in small
degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.
A - Bonds rated A are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in higher
rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.
BBB - Bonds rated BBB exhibit adequate protection parameters. However, adverse
economic conditions or changing circumstances are more likely to lead to a
weakened capacity of the obligor to meet its financial commitment on the
obligation.
BB-B-CCC-CC-C - Obligations rated BB, B, CCC, CC and C are regarded as having
significant speculative characteristics. 'BB' indicates the least degree of
speculation and 'C' the highest. while such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
D - Obligations rated D is in payment default. The D rating
category is used when interest payments on an obligation are not made on the
date due even if the applicable grace period has not expired, unless Standard &
Poor's believes that such payments will be made during such grace period. The
'D' rating also will be used upon the filing of a bankruptcy petition or the
taking of a similar action if payments on an obligation are jeopardized.
11.
Taxes
The Fund will be subject to a 4% nondeductible excise tax on certain amounts not
distributed (and not treated as having been distributed) on a timely basis in
accordance with a calendar year distribution requirement. The Fund intends to
distribute to shareholders each year an amount adequate to avoid the imposition
of such excise tax.
Dividends paid by the Fund will not qualify for the dividends-received deduction
for corporations.
The foregoing discussion relates solely to U.S. federal income tax law as
applicable to United States persons (United States citizens or residents and
United States domestic corporations, partnerships, trusts and estates). Each
shareholder who is not a United States person should consult his tax adviser
regarding the U.S. and foreign tax consequences of the ownership of shares of
the Fund, including a 30% (or lower treaty rate) United States withholding tax
on dividends representing ordinary income and net short-term capital gains, and
the applicability of United States gift and estate taxes to non-United States
persons who own Fund shares.
12.
Further Information About the Fund
The directors, trustees and officers of Lord Abbett-sponsored mutual funds,
together with the partners and employees of Lord Abbett, are permitted to
purchase and sell securities for their personal investment accounts. In engaging
in personal securities transactions, however, such persons are subject to
requirements and restrictions contained in the Fund's Code of Ethics which
complies, in substance, with each of the recommendations of the Investment
Company Institute's Advisory Group on Personal Investing. Among other things,
the Code requires that Lord Abbett partners and employees obtain advance
approval before buying or selling securities, submit confirmations and quarterly
transaction reports, and obtain approval before becoming a director of any
company; and it prohibits such persons from investing in a security 7 days
before or after any Lord Abbett-sponsored fund or Lord Abbett-managed account
considers a trade or trades in such security, from profiting on trades of the
same security within 60 days and from trading on material and non-public
information. The Code imposes certain similar requirements and restrictions on
the independent directors and trustees of each Lord Abbett-sponsored mutual fund
to the extent contemplated by the recommendations of the Advisory Group.
13.
Financial Statements
The financial statements for the fiscal year ended June 30, 1998 and the report
of Deloitte & Touche LLP, independent auditors, on such financial statements
contained in the 1998 Annual Report to Shareholders of Lord Abbett U.S.
Government Securities Money Market Fund, Inc. are incorporated herein by
reference to such financial statements and report in reliance upon the authority
of Deloitte & Touche LLP as experts in auditing and accounting.
<PAGE>
PART C OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements
Part A - Financial Highlights for the ten years
ended June 30, 1998
Part B - Statement of Net Assets at June 30,
1998
Statement of Operations for the year
ended June 30, 1998
Statements of Changes in Net Assets
for the years ended June 30, 1998 and 1997
(b) Exhibits
99.B1 Restated Charter Documents*
99.B2 By-laws*
99.B11 Consent of Deloitte & Touche LLP*
Ex.27 Financial Data Schedule*
Exhibits not listed are not a applicable.
* Filed herewith.
Item 25. Persons Controlled by or Under Common Control with Registrant
None.
Item 26. Number of Record Holders of Securities
At October 12, 1998 - Class A - 11,561
Class B - 447
Class C - 209
Item 27. Indemnification
Registrant is incorporated under the laws of the
State of Maryland and is subject to Section 2-418 of
the Corporations and Associations Article of the
Annotated Code of the State of Maryland controlling
the indemnification of directors and officers. Since
Registrant has its executive offices in the State of
New York, and is qualified as a foreign corporation
doing business in such State, the persons covered by
the foregoing statute may also be entitled to and
subject to the limitations of the indemnification
provisions of Section 721-726 of the New York
Business Corporation Law.
The general effect of these statutes is to protect
officers, directors and employees of Registrant
against legal liability and expenses incurred by
reason of their positions with the Registrant. The
statutes provide for indemnification for liability
for proceedings not brought on behalf of the
corporation and for those brought on behalf of the
corporation, and in each case place conditions under
which indemnification will be permitted, including
requirements that the officer, director or employee
acted in good faith. Under certain conditions,
payment of expenses in advance of final disposition
may be permitted. The By-Laws of Registrant, without
limiting the authority of Registrant to indemnify
any of its officers, employees or agents to the
extent consistent with applicable law, makes the
indemnification of its directors mandatory subject
only to the conditions and limitations imposed by
the above-mentioned Section 2-418 of Maryland Law
and by the provisions of Section 17(h) of the
Investment Company Act of 1940 as interpreted and
required to be implemented by SEC Release No.
IC-11330 of September 4, 1980.
In referring in its By-Laws to, and making
indemnification of directors subject to the
conditions and limitations of, both Section 2-418 of
the Maryland Law and Section 17(h) of the Investment
Company Act of 1940, Registrant intends that
conditions and limitations on the extent of the
indemnification of directors imposed by the
provisions of either Section 2-418 or Section 17(h)
shall apply and that any inconsistency between the
two will be resolved by applying the provisions of
said Section 17(h) if the condition or limitation
imposed by Section 17(h) is the more stringent. In
referring in its By-Laws to SEC Release No. IC-11330
as the source for interpretation and implementation
of said Section 17(h), Registrant understands that
it would be required under its By-Laws to use
reasonable and fair means in determining whether
indemnification of a director should be made and
undertakes to use either (1) a final decision on the
merits by a court or other body before whom the
proceeding was brought that the person to be
indemnified ("indemnitee") was not liable to
Registrant or to its security holders by reason of
willful malfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the
conduct of his office ("disabling conduct") or (2)
in the absence of such a decision, a reasonable
determination, based upon a review of the facts,
that the indemnitee was not liable by reason of such
disabling conduct, by (a) the vote of a majority of
a quorum of directors who are neither "interested
persons" (as defined in the 1940 Act) of Registrant
nor parties to the proceeding, or (b) an independent
legal counsel in a written opinion. Also, Registrant
will make advances of attorneys' fees or other
expenses incurred by a director in his defense only
if (in addition to his undertaking to repay the
advance if he is not ultimately entitled to
indemnification) (1) the indemnitee provides a
security for his undertaking, (2) Registrant shall
be insured against losses arising by reason of any
lawful advances, or (3) a majority of a quorum of
the non-interested, non-party directors of
Registrant, or an independent legal counsel in a
written opinion, shall determine, based on a review
of readily available facts, that there is reason to
believe that the indemnitee ultimately will be found
entitled to indemnification.
Insofar as indemnification for liability arising
under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange
Commission such indemnification is against public
policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for
indemnification against such liabilities (other than
the payment by the registrant of expense incurred or
paid by a director, officer or controlling person of
the registrant in the successful defense of any
action, suit or proceeding) is asserted by such
director, officer or controlling person in
connection with the securities being registered, the
registrant will, unless in the opinion of its
counsel the matter has been settled by controlling
precedent, submit to a court of appropriate
jurisdiction the question whether such
indemnification by it is against public policy as
expressed in the Act and will be governed by the
final adjudication of such issue. In addition,
Registrant maintains a directors' and officers'
errors and omissions liability insurance policy
protecting directors and officers against liability
for breach of duty, negligent act, error or omission
committed in their capacity as directors or
officers. The policy contains certain exclusions,
among which is exclusion from coverage for active or
deliberate dishonest or fraudulent acts and
exclusion for fines or penalties imposed by law or
other matters deemed uninsurable.
Item 28. Business and Other Connections of Investment Adviser
Lord, Abbett & Co. acts as investment advisor for
twelve other open-end investment companies and is
principal underwriter for all thirteen. It is also
an investment adviser to approximately 6,220 private
accounts as of May 31, 1998. Other than acting as
directors and/or officers of open-end investment
companies managed by Lord, Abbett & Co., none of
Lord, Abbett & Co.'s partners has, in the past two
fiscal years, engaged in any other business,
profession, vocation or employment of a substantial
nature for his own account or in the capacity of
director, officer, employee, partner or trustee of
any entity.
Item 29. Principal Underwriter
(a) Lord Abbett Affiliated Fund, Inc.
Lord Abbett Bond-Debenture Fund, Inc.
Lord Abbett Mid-Cap Value Fund, Inc.
Lord Abbett Developing Growth Fund, Inc.
Lord Abbett Tax-Free Income Fund, Inc.
Lord Abbett Global Fund, Inc.
Lord Abbett Series Fund, Inc.
Lord Abbett Equity Fund
Lord Abbett Tax-Free Income Trust
Lord Abbett Securities Trust
Lord Abbett Investment Trust
Lord Abbett Research Fund, Inc.
Investment Adviser
American Skandia Trust (Lord Abbett Growth and
Income Portfolio)
(b) The partners of Lord, Abbett & Co. are:
Name and Principal Positions and Offices
Business Address (1) with Registrant
-------------------- ---------------
Robert S. Dow Chairman and President
Paul A. Hilstad Vice President & Secretary
Robert Gerber Executive Vice President
Zane E. Brown Vice President
Daniel E. Carper Vice President
Robert G. Morris Vice President
John J. Walsh Vice President
The other partners who are neither officers nor directors of the Fund are
Stephen Allen, John E. Erard, Robert P. Fetch, Daria L. Foster, W. Thomas
Hudson, Stephen J. McGruder, Michael B. McLaughlin, Robert J. Noelke, R. Mark
Pennington, and Christopher J. Towle.
(1) Each of the above has a principal business address
767 Fifth Avenue, New York, NY 10153
(c) Not applicable
Item 30. Location of Accounts and Records
Registrant maintains the records, required by Rules 31a - 1(a)
and (b), and 31a - 2(a) at its main office.
Lord, Abbett & Co. maintains the records required by Rules
31a - 1(f) and 31a - 2(e) at its main office.
Certain records such as canceled stock certificates and
correspondence may be physically maintained at the main office
of the Registrant's Transfer Agent, Custodian, or Shareholder
Servicing Agent within the requirements of Rule 31a-3.
Item 31. Management Services
None
Item 32. Undertakings
The Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest
annual report to shareholders, upon request and without charge.
The registrant undertakes, if requested to do so by the holders of
at least 10% of the registrant's outstanding shares, to call a
meeting of shareholders for the purpose of voting upon the
question of removal of a director or directors and to assist in
communications with other shareholders as required by Section
16(c).
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940 the Registrant certifies that it meets all the requirements
for effectiveness of this Registration Statement pursuant to Rule 485(b) under
the Securities Act of 1933 and has duly caused this Registration Statement
and/or any amendment thereto to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York and State of New York on the
28th day of October, 1998.
LORD ABBETT U.S.GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
By:/s/ Robert S. Dow,
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
Chairman, President
and Director
/s/Robert S. Dow 10/28/98
Robert S. Dow (Title) (Date)
/s/E. Thayer Bigelow Director 10/28/98
E. Thayer Bigelow (Title) (Date)
Director
/s/William H.T. Bush 10/28/98
William H. T. Bush (Title) (Date)
Director
/s/Robert B. Calhoun 10/28/98
Robert B. Calhoun (Title) (Date)
Director
/s/Stewart S. Dixon 10/28/98
Stewart S. Dixon (Title) (Date)
Director
/s/John C. Jansing 10/28/98
John C. Jansing (Title) (Date)
Director
/s/C. Alan MacDonald 10/28/98
C. Alan MacDonald (Title) (Date)
Director
/s/Hansel B. Millican, Jr. 10/28/98
Hansel B. Millican, Jr. (Title) (Date)
Director 10/28/98
/s/Thomas J. Neff
Thomas J. Neff (Title) (Date)
Vice President and
Chief Financial Officer 10/28/98
/s/Keith F. O'Connor
Keith F. O'Connor (Title) (Date)
<PAGE>
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
ARTICLES OF RESTATEMENT
FIRST: LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET
FUND, INC., a Maryland corporation, (the "Corporation")
desires to restate its charter as currently in effect.
SECOND: The following provisions are all the provisions of
the charter currently in effect.
RESTATED ARTICLES OF INCORPORATION
OF
LORD ABBETT U.S. GOVERNMENT SECURITIES
MONEY MARKET FUND, INC.
ARTICLE I
I, the subscriber, Kenneth B. Cutler, whose post office
address is 63 Wall Street, New York, New York 10005, being at least twenty-one
years of age, am acting as incorporator with the intention of forming a
corporation under and by virtue of the General Laws of the State of Maryland
authorizing the formation of corporations.
ARTICLE II
The name of the corporation (hereinafter called the
"Corporation") is Lord Abbett U.S. Government Securities Money
Market Fund, Inc.
<PAGE>
ARTICLE III
The current post office address of the place at which the
principal office of the Corporation in the State of Maryland is located is c/o
The Prentice-Hall Corporation System, Maryland, 11 East Chase Street, Baltimore,
Maryland 21202.
The Corporation's current resident agent is The Prentice-Hall
Corporation System, Maryland, 11 East Chase Street, Baltimore, Maryland 21202.
Said resident agent is a corporation in the State of Maryland.
ARTICLE IV
The purpose or purposes for which the Corporation is formed
and the business or objects to be transacted, carried on and promoted by it, are
as follows:
1. To conduct, operate and carry on the business of an
investment company.
2. To purchase, subscribe for, invest in or otherwise acquire,
and to own, hold, sell, possess, transfer or otherwise dispose of, or turn to
account or realize upon, and generally deal in, all forms of securities of every
nature, kind, character, type and form, including but not limited to, shares,
stocks, bonds, debentures, notes, scrip, participation certificates, rights to
subscribe, warrants, options, certificates of deposit, commercial paper, bankers
acceptances, repurchase agreements, choses in action, evidences of indebtedness,
certificates of indebtedness and certificates of interest of any and every kind
and nature whatsoever, whether secured and unsecured, negotiable or
non-negotiable, issued or to be issued, by any corporation, partnership,
association, government trust, entity or person, public or private, whether
organized under the laws of the United States, or any state, commonwealth,
territory or possession thereof, or organized under the laws of any foreign
country.
3. To issue, sell, repurchase, redeem, retire, cancel,
acquire, resell, transfer, and otherwise deal in shares of the capital stock of
the Corporation, and to apply to any such repurchase, redemption, retirement,
cancellation or acquisition of shares of capital stock of the Corporation, any
funds of the Corporation, whether capital, surplus or otherwise to the full
extent permitted by the laws of Maryland, all without the vote or consent of the
stockholders of the Corporation.
<PAGE>
4. To conduct its business in the State of Maryland, all other
states and elsewhere in any part of the world, and to have one or more offices
outside the State of Maryland.
5. To do any and all things herein set forth, and in addition
such other acts and things as are necessary or convenient to the attainment of
the purposes of this Corporation, or any of them, to the same extent as natural
persons lawfully might or could do in any part of the world, and to engage in
any lawful act or activity for which corporations may be organized under the
laws of the State of Maryland.
The foregoing objects and purposes shall, except as otherwise
expressly provided, be in no way limited or restricted by reference to, or
inference from the terms of any other clause of this or any other Article of
these Articles of Incorporation, and shall each be regarded as independent, and
construed as powers as well as objects and purposes, and the enumeration of
specific purposes, objects and powers shall not be construed to limit or
restrict in any manner the meaning of general terms or the general powers of the
Corporation now or hereafter conferred by the laws of the State of Maryland, nor
shall the expression of one thing be deemed to exclude another, though it be of
like nature, not expressed; provided, however, that the Corporation shall not
have power to carry on within the State of Maryland any business whatsoever the
carrying on of which would preclude it from being classified as an ordinary
business corporation under the laws of said State; nor shall it carry on any
business, or exercise any powers, in any other state, territory, district or
country except that the same may lawfully be carried on or exercised under the
laws thereof.
ARTICLE V
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SECTION 1. The total number of shares which the Corporation
has authority to issue is 1,000,000,000 shares of capital stock of the par value
of $.001 each, having an aggregate par value of $1,000,000. The Board of
Directors of the Corporation shall have full power and authority, from time to
time, to classify or reclassify any unissued shares of stock of the Corporation,
including, without limitation, the power to classify or reclassify unissued
shares into series, and to classify or reclassify a series into one or more
classes of stock that may be invested together in the common investment
portfolio in which the series is invested, by setting or changing the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, or terms or conditions of
redemption of such shares of stock. All shares of stock of a series shall
represent the same interest in the Corporation and have the same preferences,
conversion or other rights, voting powers, restrictions, limitations as to
dividends, qualifications, and terms or conditions of redemption as the other
shares of stock of that series, except to the extent that the Board of Directors
provides for differing preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption of shares of stock of classes of such series as
determined pursuant to Articles Supplementary filed for record with the State
Department of Assessments and Taxation of Maryland, or as otherwise determined
pursuant to these Articles or by the Board of Directors in accordance with law.
Prior to the first classification of unissued shares of stock into additional
series, all outstanding shares of stock shall be of a single series, and prior
to the first classification of a series into additional classes, all outstanding
shares of stock of such series shall be of a single class. Notwithstanding any
other provision of these Articles, upon the first classification of unissued
shares of stock into additional series, the Board of Directors shall specify a
legal name for the outstanding series, as well as for the new series, in
appropriate charter documents filed for record with the State Department of
Assessments and Taxation of Maryland providing for such name change and
classification, and upon the first classification of a series into additional
classes, the Board of Directors shall specify a legal name for the outstanding
class, as well as for the new class or classes, in appropriate charter documents
filed for record with the State Department of Assessments and Taxation of
Maryland providing for such name changes and classification.
[On July 3, 1996, the Articles of Incorporation of the Corporation were
further supplemented by the filing of Articles of Amendment with the State
Department of Assessments and Taxation of Maryland which specified the legal
name for the existing class of capital stock of the Corporation, both
outstanding shares and unissued shares, as Class A.
<PAGE>
On July 9, 1996, the Articles of Incorporation of the Corporation were
further supplemented by the filing of Articles Supplementary with the State
Department of Assessments and Taxation of Maryland which, pursuant to the
authority of the Board of Directors of the Corporation to classify and
reclassify unissued shares of stock of the Corporation and to classify a series
into one or more classes of such series, the Board of Directors (i) classified
and reclassified 200,000,000 authorized but unissued Class A shares as Class C
shares and (ii) classified and reclassified 100,000,000 authorized but unissued
Class A shares as Class B shares. Such Articles Supplementary further provided
that subject to the power of the Board of Directors to classify and reclassify
unissued shares, all shares of the Corporation's Class B and C stock shall be
invested in the same investment portfolio of the Corporation as the Class A
stock and shall have the same preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemption set forth in Article V of the Articles of Incorporation
of the Corporation and shall be subject to all other provisions of the Articles
of Incorporation relating to stock of the Corporation generally.]
SECTION 2. A description of the relative preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption of all series
and classes of series of shares is as follows, unless otherwise set forth in
Articles Supplementary filed for record with the State Department of Assessments
and Taxation of Maryland or otherwise determined pursuant to these Articles:
(a) ASSETS BELONGING TO SERIES. All consideration received or
receivable by the Corporation for the issuance or sale of shares of a
particular series, together with all assets in which such consideration
is invested or reinvested, all income, earnings, profits and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall
irrecovably belong to that series for all purposes, subject only to the
rights of creditors, and shall be so recorded upon the books of account
of the Corporation. Such consideration, assets, income, earnings,
profits and proceeds, including any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the
same may be, together with any unallocated items (as hereinafter
defined) relating to that series as provided in the following sentence,
are herein referred to as "assets belonging to" that series. In the
event that there are any assets, income, earnings, profits or proceeds
thereof, funds or payments that are not readily identifiable as
belonging to any particular series (collectively "Unallocated Items"),
the Board of Directors shall allocate such Unallocated Items to and
among any one or more of the series created from time to time in such
manner and on such basis as it, in its sole discretion, deems fair and
equitable; and any Unallocated Items so allocated to a particular
series shall belong to that series. Each such allocation by the Board
of Directors shall be conclusive and binding upon the stockholders of
all series for all purposes.
<PAGE>
(b) LIABILITIES BELONGING TO SERIES. The assets belonging to
each particular series shall be charged with the liabilities of the
Corporation in respect of that series, including any class thereof, and
with all expenses, costs, charges and reserves attributable to that
series, including any such class, and shall be so recorded upon the
books of account of the Corporation. Such liabilities, expenses, costs,
charges and reserves, together with any unallocated items (as
hereinafter defined) relating to that series, including any class
thereof, as provided in the following sentence, so charged to that
series, are herein referred to as "liabilities belonging to" that
series. In the event there are any unallocated liabilities, expenses,
costs, charges or reserves of the Corporation which are not readily
identifiable as belonging to any particular series (collectively
"Unallocated Items"), the Board of Directors shall allocate and charge
such Unallocated Items to and among any one or more of the series
created from time to time in such manner and on such basis as the Board
of Directors in its sole discretion deems fair and equitable; and any
Unallocated Items so allocated and charged to a particular series shall
belong to that series. Each such allocation by the Board of Directors
shall be conclusive and binding upon the stockholders of all series for
all purposes. To the extent determined by the Board of Directors,
liabilities and expenses relating solely to a particular class
(including, without limitation, distribution expenses under a Rule
12b-1 plan and administrative expenses under an administration or
service agreement, plan or other arrangement, however designated, which
may be adopted for such class) shall be allocated to and borne by such
class and shall be appropriately reflected (in the manner determined by
the Board of Directors) in the net asset value, dividends and
distributions and liquidation rights of the shares of such class.
(c) DIVIDENDS. Dividends and distributions on shares of a
particular series may be paid to the holders of shares of that series
at such times, in such manner and from such of the income and capital
gains, accrued or realized, from the assets belonging to that series,
after providing for actual and accrued liabilities belonging to that
series, as the Board of Directors may determine. Such dividends and
distributions may vary between or among classes of a series to reflect
differing allocations of liabilities and expenses of such series
between or among such classes to such extent as may be provided in or
determined pursuant to Articles Supplementary filed for record with the
State Department of Assessments and Taxation of Maryland or as may
otherwise be determined by the Board of Directors.
<PAGE>
(d) LIQUIDATION. In the event of the liquidation or
dissolution of the Corporation, the stockholders of each series shall
be entitled to receive, as a series, when and as declared by the Board
of Directors, the excess of the assets belonging to that series over
the liabilities belonging to that series. The assets so distributable
to the stockholders of one or more classes of a series shall be
distributed among such stockholders in proportion to the respective
aggregate net asset values of the shares of such series held by them
and recorded on the books of the Corporation.
(e) VOTING. On each matter submitted to vote of the
stockholders, each holder of a share shall be entitled to one vote for
each such share standing in his name on the books of the Corporation
irrespective of the series or class thereof and all shares of all
series and classes shall vote as a single class ("Single Class
Voting"); provided, however, that (i) as to any matter with respect to
which a separate vote of any series or class is required by the
Investment Company Act of 1940, as amended from time to time,
applicable rules and regulations thereunder, or the Maryland General
Corporation Law, such requirement as to a separate vote of that series
or class shall apply in lieu of Single Class Voting as described above;
(ii) in the event that the separate vote requirements referred to in
(i) above apply with respect to one or more (but less than all) series
or classes, then, subject to (iii) below, the shares of all other
series and classes shall vote as a single class; and (iii) as to any
matter which does not affect the interest of a particular series or
class, only the holders of shares of the one or more affected series or
classes shall be entitled to vote.
(f) CONVERSION. At such times (which times may vary among
shares of a class) as may be determined by the Board of Directors,
shares of a particular class of a series may be automatically converted
into shares of another class of such series based on the relative net
asset values of such classes at the time of conversion, subject,
however, to any conditions of conversion that may be imposed by the
Board of Directors.
SECTION 3. Each share of the capital stock of the Corporation
shall be subject to the following provisions:
<PAGE>
(a) All shares of the capital stock of the Corporation now or
hereafter authorized shall be subject to redemption and redeemable at
the option of the stockholder, in the sense used in the General Laws of
the State of Maryland authorizing the formation of corporations. Each
holder of the shares of capital stock of the Corporation, upon request
to the Corporation accompanied by surrender (to the Corporation, or an
agent designated by it) of the appropriate stock certificate or
certificates, if any, in proper form for transfer, and such other
instruments as the Board of Directors may require, shall be entitled to
require the Corporation to redeem all or any part of the shares of
capital stock outstanding in the name of such holder on the books of
the Corporation, at a redemption price equal to the net asset value of
such shares determined as hereinafter set forth. Notwithstanding the
foregoing, the Corporation may deduct from the proceeds otherwise due
to any stockholder requiring the Corporation to redeem shares less a
redemption charge not to exceed one percent (1%) of such net asset
value or a reimbursement charge, a deferred sales charge or other
charge that is integral to the Corporation's distribution program
(which charges may vary within and among series and classes) as may be
established from time to time by the Board of Directors.
(b) Notwithstanding the foregoing, the Board of Directors of
the Corporation may suspend the right of the holders of the capital
stock of the Corporation to require the Corporation to redeem shares of
such capital stock or may suspend any voluntary purchase of such
capital stock:
(i) for any period (A) during which the New York
Stock Exchange is closed other than the customary weekend and
holiday closing, or (B) during which trading on the New York
Stock Exchange is restricted;
(ii) for any period during which an emergency, as
defined by the rules of the Securities and Exchange Commission
or any successor thereto, exists as a result of which (A)
disposal by the Corporation of securities owned by it is not
reasonably practicable, or (B) it is not reasonably
practicable for the Corporation fairly to determine the value
of its net assets; or
(iii) for such other periods as the Securities and
Exchange Commission or any successor thereto may by order
permit for the protection of security holders of the
Corporation.
<PAGE>
(c) The Corporation, pursuant to a resolution of the Board of
Directors and without the vote or consent of stockholders of the
Corporation, shall have the right to redeem at net asset value all
shares of capital stock in any stockholder account in which there are
less than 500 shares or such lesser number of shares as shall be
specified in such resolution. Such resolution shall set forth that
redemption of shares in such accounts has been determined to be in the
economic best interest of the Corporation or necessary to reduce
disproportionately burdensome expenses in servicing stockholder
accounts. Such resolution shall provide that prior notice of at least
30 days shall be given to a stockholder before such redemption of
shares and that the stockholder will have 30 days (or such longer
period as is specified in the resolution) from the date of the notice
to avoid such redemption by increasing his account to at least 500
shares, or such lesser number of shares as is specified in the
resolution.
SECTION 4. Notwithstanding any provision of law requiring any
action to be taken or authorized by the affirmative vote of the holders of a
designated proportion greater than a majority of the shares or votes entitled to
be cast, such action shall be effective and valid if taken or authorized by the
affirmative vote of the holders of a majority of the total number of shares
outstanding and entitled to vote thereon pursuant to the provisions of these
Articles of Incorporation.
SECTION 5. No holder of stock of the Corporation shall, as
such holder, have any right to purchase or subscribe for any shares of the
capital stock of the Corporation which it may issue or sell (whether out of the
number of shares now or hereafter authorized by these Articles of Incorporation,
or any amendment thereof, or out of any shares of the capital stock of the
Corporation acquired by it after the issue thereof, or otherwise) other than
such right, if any, as the Board of Directors, in its discretion, may determine.
<PAGE>
ARTICLE VI
The current number of directors of the Corporation is nine,
and the names of those who shall act as such until their successors are duly
elected and qualify are as follows:
Robert S. Dow
E. Thayer Bigelow
William H.T. Bush
Robert B. Calhoun
Stewart S. Dixon
John C. Jansing
C. Alan MacDonald
Hansel B. Millican, Jr.
Thomas J. Neff
However, the By-Laws of the Corporation may fix the number of directors at a
number other than nine and may authorize the Board of Directors, by the vote of
a majority of the entire Board of Directors, to divide the Board into classes,
to increase or decrease the number of directors within a limit specified in the
By-Laws, provided that in no case shall the number of directors be less than
three, and to fill the vacancies created by any such increase in the number of
directors. Unless otherwise provided in the By-Laws of the Corporation, the
directors of the Corporation need not be stockholders.
ARTICLE VII
The following provisions are inserted for the management of
the business and conduct of the affairs of the Corporation, and to create,
define, limit and regulate the powers of the Corporation, the directors and the
stockholders.
SECTION 1. In furtherance and not in limitation of the powers
conferred by statute and pursuant to these Articles of Incorporation, the Board
of Directors is expressly authorized to do the following:
(a) To make, adopt, alter, amend and repeal by-laws of
the Corporation;
<PAGE>
(b) To declare (from interest, dividends or other income
received or accrued, from accruals of original issue or other discounts
on obligations held, from capital or other profits on portfolio assets
whether realized or unrealized, from surplus whether earned, capital or
paid in from any other lawful sources) dividends and distributions on
the Corporation's shares, for payment in cash, property or the
Corporation's own stock to stockholders of record on such dates (which
may be as frequently as every day) and payable at such intervals as the
Board of Directors shall determine at any time in advance of such
payment, whether or not in the amount of such payment can at that time
be determined or must be calculated subsequent to declaration and prior
to payment by reference to amounts or other factors not yet determined
at the time of declaration (including but not limited to the amount of
a dividend or distribution to be determined only by reference to what
is sufficient to enable the Corporation to qualify as a regulated
investment company under the United States Internal Revenue Code or to
avoid liability for Federal income tax); provided that if a dividend is
paid from any source other than earned surplus, the source of the
dividend shall be disclosed not later than at the time of payment to
the stockholders who receive it (the authority granted by this
sub-section (b) to permit, without limitation, and if otherwise lawful:
the declaration of dividends or distributions by means of a formula or
other similar method of determination whether or not the amount of such
dividend or distribution can be calculated at the time of such
declaration; establishing record or payment dates for dividends or
distributions on any basis, including establishing a number of record
or payment dates subsequent to the declaration of any dividend or
distribution; establishing the same payment date for any number or
dividends or distributions declared prior to such date, providing for
the payment of dividends or distributions declared and as yet unpaid to
stockholders of the Corporation redeeming shares prior to the payment
date otherwise applicable; and providing in advance for the conditions
under which any dividend or distribution may be payable in the
Corporation's own shares to all or less than all of the Corporation's
stockholders and for the calculation of any transfer from earned
surplus to capital surplus in excess of the transfer to the stated
capital of the aggregate par value of the shares so to be issued,
whether such dividend or distribution is in authorized but unissued or
in treasury shares of the Corporation);
<PAGE>
(c) To issue and sell or to cause the issuance and sale of
shares of the Corporation's capital stock in such amounts and on such
terms and conditions, for such purpose and for such amount or kind of
consideration as is now or hereafter permitted by the laws of the State
of Maryland;
(d) To purchase and to cause to be purchased shares of the
capital stock of the Corporation, pursuant to these Articles of
Incorporation, upon tender thereof by the holder or holders thereof or
otherwise, provided the Corporation has assets legally available for
such purpose whether arising out of paid-in surplus, other surplus, net
profits or otherwise, to such extent and in such manner and upon such
terms as the Board of Directors shall deem expedient, and to pay for
such shares in cash then held or owned by the Corporation;
(e) To authorize, subject to such vote, consent, or approval
of stockholders and other conditions, if any, as may be required by any
applicable statute, rule or regulation, the execution and performance
by the Corporation of an agreement or agreements with any person,
corporation, association, partnership, or other organization whereby,
subject to the supervision and control of the Board of Directors, any
such other person, corporation, association, partnership, or other
organization, shall render managerial, investment advisory and related
services to the Corporation (including, if deemed advisable, the
management or supervision of the investment portfolio of the
Corporation) upon such terms and conditions as may be provided in such
agreement or agreements;
(f) To authorize, subject to such vote, consent or approval of
stockholders and other conditions, if any, as may be required by any
applicable statute, rule or regulation, the execution and performance
by the Corporation of an agreement or agreements, which may be
exclusive, with any person, corporation, association, partnership or
other organization, as distributor, providing for the sale and
distribution of shares of the capital stock of the Corporation. Such
agreement or agreements may provide for the charge by the Corporation
of a premium over the net asset value (determined as hereinafter
provided) of such shares and allowance of a discount by the Corporation
to such distributor, and may further provide for the reallowance by
such distributor of concessions or commissions from such discount;
provided, however, that such discount shall not exceed the amount of
the premium;
<PAGE>
(g) To authorize any agreement of the character described in
subsection (e) or (f) of this Section 1 with any person, corporation,
association, partnership or other organization, although one or more of
the members of the Board of Directors or officers of the Corporation
may be the other party to any such agreement or an officer, director,
shareholder, or member of such other party, and no such agreement shall
be invalidated or rendered voidable by reason of the existence of any
such relationship. Any director of the Corporation who is also a
director, officer, shareholder, or member of such other party may be
counted in determining the existence of a quorum at any meeting of the
Board of Directors which shall authorize any such agreement, and may
vote thereat to authorize any such contract or transaction, with like
force and effect as if he were not such director, officer, shareholder,
or member of such other party. Any Agreement entered into pursuant to
said subsections (e) or (f) shall be consistent with and subject to the
requirements of the Investment Company Act of 1940 (including any
amendment thereof or other applicable Act of Congress hereafter
enacted). No amendment to any agreement entered into pursuant to said
subsection (e) (other than an amendment reducing the compensation of
the other party thereto) shall be effective unless assented to by the
affirmative vote of a majority of the outstanding voting securities of
the Corporation (as such phrase is defined in the Investment Company
Act of 1940.
SECTION 2. The Board of Directors may authorize the purchase
by the Corporation, either directly or through any agent, of shares of its
capital stock, in the open market or otherwise, at prices not in excess of the
net asset value of such shares (determined as hereinafter provided) as of a time
determined by the Board of Directors reasonably proximate to the time of
purchase by the Corporation or any such agent.
SECTION 3. For the purposes referred to in these Articles of
Incorporation, the net asset value of shares of the capital stock of the
Corporation of each series and class as of any particular time (a "determination
time") shall be determined by or pursuant to the direction of the Board of
Directors as follows:
<PAGE>
(a) At times when a series is not classified into multiple
classes, the net asset value of each share of stock of a series, as of
a determination time, shall be the quotient, carried out to not less
than two decimal points, obtained by dividing the net value of the
assets of the Corporation belonging to that series (determined as
hereinafter provided) as of such determination time by the total number
of shares of that series then outstanding, including all shares of that
series which the Corporation has agreed to sell for which the price has
been determined, and excluding shares of that series which the
Corporation has agreed to purchase or which are subject to redemption
for which the price has been determined.
The net value of the assets of the Corporation of a series as
of a determination time shall be determined in accordance with sound
accounting practice by deducting from the gross value of the assets of
the Corporation belonging to that series (determined as hereinafter
provided), the amount of all liabilities belonging to that series (as
such terms are defined in subsection (b) of Section 2 of Article VI),
in each case as of such determination time.
The gross value of the assets of the Corporation belonging to
a series as of such determination time shall be an amount equal to all
cash, receivables, the market value of all securities for which market
quotations are readily available and the fair value of other assets of
the Corporation belonging to that series (as such terms are defined in
subsection (a) of Section 2 of Article V) at such determination time,
all determined in accordance with sound accounting practice and giving
effect to the following:
(1) the fair value as of any such determination time
of any security owned by the Corporation which is listed or
admitted to trading privileges on the New York Stock Exchange
or the American Stock Exchange shall be the last sale price or
(in the case of a security in which there has been no
previously reported sale transaction since the last
determination time) the mean between the last bid price and
the last asked price, for such security on such exchange. In
case securities being valued are listed or admitted to trading
privileges on any securities exchange other than the New York
Stock Exchange or the American Stock Exchange, the securities
exchange, sale transactions or bid or asked prices which are
to be used as aforesaid, shall be selected by the Board of
Directors or any officer or other person designated by the
Board of Directors for the purpose. The determination of the
fair value of securities hereunder may be made in reliance on
any recognized source of quotations or basis for ascertaining
quotations. If a security is traded in more than one market, a
determination may be made as to which market most accurately
reflects the value of such security.
<PAGE>
(2) The fair value of other property, including any
securities which are neither listed nor admitted to trading
privileges on any exchange and securities in an
over-the-counter market shall be determined in good faith in
such manner as the Board of Directors shall prescribe from
time to time.
(b) At times when a series is classified into multiple
classes, the net asset value of each share of stock of a class of such
series shall be determined in accordance with subsections (a) and (c)
of this Section 3 with appropriate adjustments to reflect differing
allocations of liabilities and expenses of such series between or among
such classes to such extent as may be provided in or determined
pursuant to Articles Supplementary filed for record with the State
Department of Assessments and Taxation of Maryland or as may otherwise
be determined by the Board of Directors.
(c) The Board of Directors is empowered, in its discretion, to
establish other methods for determining such net asset value whenever
such other methods are deemed by it to be necessary or desirable,
including, but without limiting the generality of the foregoing, any
method deemed necessary or desirable in order to enable the Corporation
to comply with any provision of the Investment Company Act of 1940 or
any rule or regulation thereunder.
<PAGE>
SECTION 4. Any determination as to any of the following
matters made by or pursuant to the direction of the Board of Directors
consistent with these Articles of Incorporation and in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of duties, shall
be final and conclusive and shall be binding upon the Corporation and every
holder of shares of capital stock of the Corporation, of any series or class,
namely, the amount of the assets, obligations, liabilities and expenses of the
Corporation or belonging to any series or with respect to any class; the amount
of the net income of the Corporation from dividends and interest for any period
and the amount of assets at any time legally available for the payment of
dividends with respect to any series or class; the amount of paid-in surplus,
other surplus, annual or other net profits, or net assets in excess of capital,
undivided profits, or excess of profits over losses on sales of securities
belonging to the Corporation or any series or class; the amount, purpose, time
of creation, increase or decrease, alteration or cancellation of any reserves or
charges and the propriety thereof (whether or not any obligation or liability
for which such reserves or charges shall have been created shall have been paid
or discharged) with respect to the Corporation or any series or class; the
market value, or any sale, bid or asked price to be applied in determining the
market value, of any security owned or held by the Corporation; the fair value
of any other asset owned by the Corporation; the number of shares of stock of
any series or class issued or issuable; the existence of conditions permitting
the postponement of payment of the repurchase price of shares of stock of any
series or class or the suspension of the right of redemption as provided by law;
any matter relating to the acquisition, holding and disposition of securities
and other assets by the Corporation; any question as to whether any transaction
constitutes a purchase of securities on margin, a short sale of securities, or
an underwriting of the sale of, or participation in any underwriting or selling
group in connection with the public distribution of any securities; and any
matter relating to the issue, sale, repurchase and/or other acquisition or
disposition of shares of stock of any series or class.
SECTION 5. The Corporation is adopting its corporate title
through permission of the firm of Lord, Abbett & Co., and if it shall enter into
a management or advisory contract with such firm or a subsidiary or affiliate of
such firm, or a successor, the Corporation shall make appropriate agreements
that upon the termination of such contract for any cause, or if such firm or
subsidiary or affiliate or successor deems it advisable to withdraw the right to
the use of its name, the Corporation will, at the request of such firm or
subsidiary or affiliate or successor, take such action as may be necessary to
change its name to eliminate all use of or reference to the words "Lord Abbett"
in any form and will neither use the registered service mark of Lord, Abbett &
Co., without the written consent of such firm or subsidiary or affiliate or
successor. The Corporation shall also agree in such contract that investment
companies other than the Corporation for which such firm or subsidiary or
affiliate or successor may act as investment adviser, and other companies
affiliated with Lord, Abbett & Co., may be formed with the words "Lord Abbett"
in their corporate titles. Such agreements on the part of the Corporation are
hereby made binding upon it, its directors, officers, stockholders, creditors
and all other persons claiming under or through it.
ARTICLE VIII
<PAGE>
From time to time any of the provisions of these Articles of
Incorporation may be amended, altered or repealed (including any amendment that
changes the terms of any of the outstanding stock by classification,
reclassification or otherwise), and other provisions that might, under the
statutes of the State of Maryland at the time in force, be lawfully contained in
articles of incorporation may be added or inserted, upon the vote of the holders
of a majority of the shares of capital stock of the Corporation at the time
outstanding and entitled to vote, and all rights at any time conferred upon the
stockholders of the Corporation by these Articles of Incorporation are subject
to the provisions of this Article VIII.
THIRD: The foregoing restatement of the charter has been
approved by a majority of the entire board of directors.
FOURTH: The charter is not amended by these Articles of
Restatement.
FIFTH: The current address of the principal office of the
Corporation is set forth in Article III of the foregoing
restatement of the charter.
SIXTH: The name and address of the Corporation's current
resident agent are set forth in Article III of the
foregoing restatement of the charter.
SEVENTH: The number of directors of the Corporation and the
names of those currently in office are set forth in
Article VI of the foregoing restatement of the charter.
The undersigned Vice President acknowledges these Articles of
Restatement to be the corporate act of the Corporation and as to all matters or
facts set forth herein required to be verified under oath, the undersigned Vice
President acknowledges that to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that this
statement is made under the penalties of perjury.
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused these Articles
to be signed in its name and on its behalf by its Vice President and witnessed
to by its Secretary on this 27th day of October, 1998.
LORD ABBETT U.S. GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
By /s/Thomas F. Konop
Thomas F. Konop, Vice President
WITNESS:
/s/ Paul A. Hilstad
Paul A. Hilstad, Secretary
BY-LAWS
OF
LORD ABBETT CASH RESERVE FUND, INC.
(a Maryland corporation)
ARTICLE I
OFFICES
Section 1. Principal Office. The principal office of the Corporation in
Maryland shall be in the City of Baltimore, and the name of the resident agent
in charge thereof is the Prentice-Hall Corporation Systems, Maryland.
Section 2. Other Offices. The Corporation may also have an office in
the City and State of New York and offices at such other places as the Board of
Directors may from time to time determine.
<PAGE>
ARTICLE II
STOCKHOLDERS MEETINGS
Section 1. ANNUAL MEETINGS. The Corporation shall not hold an annual
meeting of its stockholders in any fiscal year of the Corporation unless
required in accordance with the following sentence. The Chairman of the Board or
the President shall call an annual meeting of the stockholders when the election
of directors is required to be acted on by the stockholders under the Investment
Company Act of 1940, as amended, and the Chairman of the Board, the President, a
Vice President, the Secretary or any director shall call an annual meeting of
stockholders at the request in writing of a majority of the Board of Directors
or of stockholders holding at least one-quarter of the stock of the Corporation
outstanding and entitled to vote at the meeting. Any annual meeting of the
stockholders held pursuant to the foregoing sentence shall be held at such time
and at such place, within the City of New York or elsewhere, as may be fixed by
the Chairman of the Board or the President or the Board of Directors or by the
stockholders holding at least one-quarter of the stock of the Corporation
outstanding and entitled to vote, as the case may be, and as may be stated in
the notice setting forth such call, provided that any stockholders requesting
such meeting shall have paid to the Corporation the reasonably estimated cost of
preparing and mailing the notice thereof, which the Secretary shall determine
and specify to such stockholders. Any meeting of stockholders held in accordance
with this Section 1 shall for all purposes constitute the annual meeting of
stockholders for the fiscal year of the Corporation in which the meeting is held
and, without limiting the generality of the foregoing, shall be held for the
purposes of (a) acting on any such matter or matters so required to be acted on
by stockholders under the Investment Company Act of 1940, as amended, and (b)
electing directors to hold the offices of any directors who have held office for
more than one year (or, in the case of directors elected prior to July 1, 1987,
who have held office for more than three years) or who have been elected by the
Board of Directors to fill vacancies which result from any cause, and for
transacting such other business as may properly be brought before the meeting.
Only such business, in addition to that prescribed by law, by the Articles of
Incorporation and by these By-Laws, may be brought before such meeting as may be
specified by resolution of the Board of Directors or by writing filed with the
Secretary of the Corporation and signed by the Chairman of the Board or by the
President or by a majority of the directors or by stockholders holding at least
one-quarter of the stock of the Corporation outstanding and entitled to vote at
the meeting.
Section 2. SPECIAL MEETINGS. Special meetings of the stockholders for
any purpose or purposes may be held upon call by the President or by a majority
of the Board of Directors, and shall be called by the President, a Vice
President, the Secretary or any director at the request in writing of a majority
of the Board of Directors or of stockholders holding at least one-quarter of the
stock of the Corporation outstanding and entitled to vote at the meeting, at
such time and at such place where an annual meeting of stockholders could be
held, as may be fixed by the President or the Board of Directors or by the
stockholders holding at least one-quarter of the stock of the Corporation
outstanding and so entitled to vote, as the case may be, and as may be stated in
the notice setting forth such call. Such request shall state the purpose or
purposes of the proposed meeting, and only such purpose or purposes so specified
may properly be brought before such meeting.
<PAGE>
Section 3. NOTICE OF MEETINGS. Written or printed notice of every
annual or special meeting of stockholders, stating the time and place thereof
and the general nature of the business proposed to be transacted at any such
meeting, shall be delivered personally or mailed not less than 10 nor more than
90 days previous thereto to each stockholder of record entitled to vote at the
meeting at his address as the same appears on the books of the Corporation.
Meetings may be held without notice if all of the stockholders entitled to vote
are present or represented at the meeting, or if notice is waived in writing,
either before or after the meeting, by those not present or represented at the
meeting. No notice of an adjourned meeting of the stockholders other than an
announcement of the time and place thereof at the preceding meeting shall be
required.
Section 4. QUORUM. At every meeting of the stockholders the holders
of record of one-third of the outstanding shares of the stock of the Corporation
entitled to vote at the meeting, whether present in person or represented by
proxy, shall, except as otherwise provided by law, constitute a quorum. If at
any meeting there shall be no quorum, the holders of record of a majority of
such shares entitled to vote at the meeting so present or represented may
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall have been obtained, at which time any business
may be transacted which might have been transacted at the meeting as originally
called.
Section 5. VOTING. Each stockholder entitled to vote at any meeting
shall have one vote in person or by proxy for each share of stock held by him,
but no proxy shall be voted after eleven months from its date, unless such proxy
provides for a longer period. All elections of directors shall be had, and all
questions except as otherwise provided by law or by the Articles of
Incorporation or by these By-Laws, shall be decided, by a majority of the votes
cast by stockholders present or represented and entitled to vote thereat in
person or by proxy.
<PAGE>
ARTICLE III
BOARD OF DIRECTORS
Section 1. GENERAL POWERS. The property, affairs and business of the
Corporation shall be managed by the Board of Directors, provided, however, that
the Board of Directors may authorize the Corporation to enter into an agreement
or agreements with any person, corporation, association, partnership or other
organization, subject to the Board's supervision and control, for the purpose of
providing managerial, investment advisory and related services to the
Corporation which may include management or supervision of the investment
portfolio of the Corporation.
Section 2. NUMBER, CLASS, QUORUM, ELECTION, TERM OF OFFICE AND
QUALIFICATIONS. The Board of Directors of the Corporation shall consist of not
less than three or more than fifteen persons, none of whom need be stockholders
of the Corporation. The number of directors (within the above limits) shall be
determined by the Board of Directors from time to time, as it sees fit, by vote
of a majority of the whole Board. Directors elected prior to July 1, 1987, shall
be divided into three classes, each to hold office for a term of three years;
directors elected thereafter shall consist of one class only. The directors
shall be elected at each annual meeting of stockholders and, whether or not
elected for a specific term, shall hold office, unless sooner removed, until
their respective successors are elected and qualify.
<PAGE>
One-third of the whole Board, but in no event less than two, shall
constitute a quorum for the transaction of business, but if at any meeting of
the Board there shall be less than a quorum present, a majority of the directors
present may adjourn the meeting from time to time until a quorum shall have been
obtained, when any business may be transacted which might have been transacted
at the meeting as originally convened. No notice of an adjourned meeting of the
directors other than an announcement of the time and place thereof at the
preceding meeting shall be required. The acts of the majority of the directors
present at any meeting at which there is a quorum shall be the acts of the
Board, except as otherwise provided by law, by the Articles of Incorporation or
by these By-Laws.
Section 3. VACANCIES. The Board of Directors, by vote of a majority
of the whole Board, may elect directors to fill vacancies in the Board resulting
from an increase in the number of directors or from any other cause. Directors
so chosen shall hold office until their respective successors are elected and
qualify, unless sooner displaced pursuant to law or these By-Laws.
The stockholders, at any meeting called for the purpose, may, with or
without cause, remove any director by the affirmative vote of the holders of a
majority of the votes entitled to be cast, and at any meeting called for the
purpose may fill the vacancy in the Board thus caused.
<PAGE>
Section 4. REGULAR MEETINGS. Regular meetings of the Board of
Directors shall be held at such time and place, within or without the State of
Maryland, as may from time to time be fixed by Resolution of the Board or as may
be specified in the notice of any meeting. No notice of regular meetings of the
Board shall be required.
Section 5. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called from time to time by the President, any Vice President
or any two directors. Each special meeting of the Board shall be held at such
place, either within or outside the State of Maryland, as shall be designated in
the notice of such meeting. Notice of each such meeting shall be mailed to each
director, at his residence or usual place of business, at least two days before
the day of the meeting, or shall be directed to him at such place by telegraph
or cable, or be delivered to him personally not later than the day before the
day of the meeting. Every such notice shall state the time and place of the
meeting but need not state the purposes thereof, except as otherwise expressly
provided in these By-Laws or by statute.
Section 6. TELEPHONIC CONFERENCE MEETINGS. Any meeting of the Board
or any committee thereof may be held by conference telephone, regardless where
each director may be located at the time, by means of which all persons
participating in the meeting can hear each other, and participation in such
meeting in such manner shall constitute presence in person at such meeting.
<PAGE>
Section 7. FEES AND EXPENSES. The directors shall receive such fees
and expenses for services to the Corporation as may be fixed by the Board of
Directors, subject however, to such limitations as may be provided in the
Articles of Incorporation. Nothing herein contained shall be construed to
preclude any director from serving the Corporation in any other capacity as an
officer, agent or otherwise and receiving compensation therefor.
<PAGE>
Section 8. TRANSACTIONS WITH DIRECTORS. Except as otherwise provided
by law or in the Articles of Incorporation, a director of the Corporation shall
not in the absence of fraud be disqualified from office by dealing or
contracting with the Corporation either as a vendor, purchaser or otherwise, nor
in the absence of fraud shall any transaction or contract of the Corporation be
void or voidable or affected by reason of the fact that any director, or any
firm of which any director is a member, or any corporation of which any director
is an officer, director or stockholder, is in any way interested in such
transaction or contract; provided that at the meeting of the Board of Directors,
at which said contract or transaction is authorized or confirmed, the existence
of an interest of such director, firm or corporation is disclosed or made known
and there shall be present a quorum of the Board of Directors a majority of
which, consisting of directors not so interested, shall approve such contract or
transaction. Nor shall any director be liable to account to the Corporation for
any profit realized by him from or through any such transaction or contract of
the Corporation ratified or approved as aforesaid, by reason of the fact that he
or any firm of which he is a member, or any corporation of which he is an
officer, director, or stockholder, was interested in such transaction or
contract. Directors so interested may be counted when present at meetings of the
Board of Directors for the purpose of determining the existence of a quorum. Any
contract, transaction or act of the Corporation or of the Board of Directors
(whether or not approved or ratified as hereinabove provided) which shall be
ratified by a majority of the votes cast at any annual or special meeting at
which a quorum is present called for such purpose, or approved in writing by a
majority in interest of the stockholders having voting power without a meeting,
shall except as otherwise provided by law, be valid and as binding as though
ratified by every stockholder of the Corporation.
Section 9. COMMITTEES. The Board of Directors may, by resolution
adopted by a majority of the whole Board, designate one or more committees each
such committee to consist of two or more directors of the Corporation, which, to
the extent permitted by law and provided in said resolution, shall have and may
exercise the powers of the Board over the business and affairs of the
Corporation, and may have power to authorize the seal of the Corporation to be
affixed to all papers which may require it. Such committee or committees shall
have such name or names as may be determined from time to time by resolution
adopted by the Board of Directors. A majority of the members of any such
committee may determine its action and fix the time and place of its meetings,
unless the Board of Directors shall otherwise provide. The Board of Directors
shall have power at any time to change the membership of, to fill vacancies in,
or to dissolve any such committee.
<PAGE>
Section 10. WRITTEN CONSENTS. Any action required or permitted to be
taken at any meeting of the Board of Directors or by any committee thereof may
be taken without a meeting, if a written consent thereto is signed by all
members of the Board or of such committee, as the case may be, and such written
consent is filed with the minutes or proceedings of the Board or committee.
Section 11. WAIVER OF NOTICE. Whenever under the provisions of these
By-Laws, or of the Articles of Incorporation, or of any of the laws of the State
of Maryland, or other applicable statute, the Board of Directors is authorized
to hold any meeting or take any action after notice or after the lapse of any
prescribed period of time, a waiver thereof, in writing, signed by the person or
persons entitled to such notice or lapse of time, whether before or after the
time of meeting or action stated herein, shall be deemed equivalent thereto. The
presence at any meeting of a person or persons entitled to notice thereof shall
be deemed a waiver of such notice as to such person or persons.
ARTICLE IV
OFFICERS
Section 1. NUMBER AND DESIGNATION. The Board of Directors shall each
year appoint from among their members a Chairman and a President of the
Corporation, and shall appoint one or more Vice Presidents, a Secretary and a
Treasurer and, from time to time, any other officers and agents as it may deem
proper. Any two of the above-mentioned offices, except those of the President
and a Vice President, may be held by the same person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity if such
instrument be required by law or by these By-Laws to be executed, acknowledged
or verified by any two or more officers.
<PAGE>
Section 2. TERM OF OFFICE. The term of office of all officers shall
be one year or until their respective successors are chosen; but any officer or
agent chosen or appointed by the Board of Directors may be removed, with or
without cause, at any time, by the affirmative vote of a majority of the members
of the Board then in office.
Section 3. DUTIES. Subject to such limitations as the Board of
Directors may from time to time prescribe, the officers of the Corporation shall
each have such powers and duties as generally appertain to their respective
offices, as well as such powers and duties as from time to time may be conferred
by the Board of Directors.
ARTICLE V
CERTIFICATE OF STOCK
Section 1. FORM AND ISSUANCE. Each stockholder of the Corporation
shall be entitled upon request, to a certificate or certificates, in such form
as the Board of Directors may from time to time prescribe, which shall represent
and certify the number of shares of stock of the Corporation owned by such
stockholder. The certificates for shares of stock of the Corporation shall bear
the signature, either manual or facsimile, of the President or a Vice President
and the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary, and shall be sealed with the seal of the Corporation or bear a
facsimile of such seal. The validity of any stock certificate shall not be
affected if any officer whose signature appears thereon ceases to be an officer
of the Corporation before such certificate is issued.
<PAGE>
Section 2. TRANSFER OF STOCK. The shares of stock of the Corporation
shall be transferable on the books of the Corporation by the holder thereof in
person or by a duly authorized attorney, upon surrender for cancellation of a
certificate or certificates for a like number of shares, with a duly executed
assignment and power of transfer endorsed thereon or attached thereto, or, if no
certificate has been issued to the holder in respect of shares of stock of the
Corporation, upon receipt of written instructions, signed by such holder, to
transfer such shares from the account maintained in the name of such holder by
the Corporation or its agent. Such proof of the authenticity of the signatures
as the Corporation or its agent may reasonably require shall be provided.
<PAGE>
Section 3. LOST, STOLEN, DESTROYED AND MUTILATED CERTIFICATES. The
holder of any stock of the Corporation shall immediately notify the Corporation
of any loss, theft, destruction or mutilation of any certificate therefor, and
the Board of Directors may, in its discretion, cause to be issued to him a new
certificate or certificates of stock, upon the surrender of the mutilated
certificate or in case of loss, theft or destruction of the certificate upon
satisfactory proof of such loss, theft, or destruction; and the Board of
Directors may, in its discretion, require the owner of the lost, stolen or
destroyed certificate, or his legal representatives, to give to the Corporation
and to such registrar or transfer agent as may be authorized or required to
countersign such new certificate or certificates a bond, in such sum as they may
direct, and with such surety or sureties, as they may direct, as indemnity
against any claim that may be made against them or any of them on account of or
in connection with the alleged loss, theft, or destruction of any such
certificates.
<PAGE>
Section 4. RECORD DATE. The Board of Directors may fix, in advance, a
date as the record date for the purpose of determining stockholders entitled to
notice of, or to vote at, any meeting of stockholders, or stockholders entitled
to receive payment of any dividend or the allotment of any rights, or in order
to make a determination of stockholders for any other proper purpose. Such date,
in any case, shall be not more than 90 days, and in case of a meeting of
stockholders, not less than 10 days, prior to the date on which the particular
action requiring such determination of stockholders is to be taken. In lieu of
fixing a record date, the Board of Directors may provide that the stock transfer
books shall be closed for a stated period but not to exceed, in any case, 20
days prior to the date of any meeting of stockholders or the date for payment of
any dividend or the allotment of rights. If the stock transfer books are closed
for the purpose of determining stockholders entitled to notice of or to vote at
a meeting of stockholders, such books shall be closed for at least 10 days
immediately preceding such meeting. If no record date is fixed and the stock
transfer books are not closed for determination of stockholders, the record date
for the determination of stockholders entitled to notice of, or to vote at, a
meeting of stockholders shall be at the close of business on the day on which
notice of the meeting is mailed or the day 30 days before the meeting, whichever
is closer date to the meeting, and the record date for the determination of
stockholders entitled to receive payment of a dividend or an allotment of any
rights shall be at the close of business on the day on which the resolution of
the Board of Directors declaring the dividend or allotment of rights is adopted,
provided that the payment or allotment date shall not be more than 90 days after
the date of the adoption of such resolution.
ARTICLE VI
CORPORATE BOOKS
The books of the Corporation, except the original or a duplicate
stock ledger, may be kept outside the State of Maryland at such place or places
as at the Board of Directors may from time to time determine. The original or
duplicate stock ledger shall be maintained at the office of the Corporation's
transfer agent.
ARTICLE VII
SIGNATURES
Except as otherwise provided in these By-Laws or as the Board of
Directors may generally or in particular cases authorize the execution thereof
in some other manner, all deeds, leases, transfers, contracts, bonds, notes,
checks, drafts and other obligations made, accepted or endorsed by the
Corporation and all endorsements, assignments, transfers, stock powers or other
instruments of transfer of securities owned by or standing in the name of the
Corporation shall be signed or executed by two officers of the Corporation, who
shall be the President or a Vice President and a Vice President, the Secretary
or the Treasurer.
<PAGE>
ARTICLE VIII
FISCAL YEAR
The fiscal year of the Corporation shall be established by resolution
of the Board of Directors of the Corporation.
ARTICLE IX
CORPORATE SEAL
The corporate seal of the Corporation shall consist of a flat faced
circular die with the word "Maryland" together with the name of the Corporation,
the year of its organization, and such other appropriate legend as the Board of
Directors may from time to time determine, cut or engrave thereon. In lieu of
the corporate seal, when so authorized by the Board of Directors or a duly
empowered committee thereof, a facsimile thereof may be impressed or affixed or
reproduced.
<PAGE>
ARTICLE X
INDEMNIFICATION
As part of the consideration for agreeing to serve and serving as a
director of the Corporation, each director of the Corporation shall be
indemnified by the Corporation against every judgment, penalty, fine,
settlement, and reasonable expense (including attorneys' fees) actually incurred
by the director in connection with any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, in
which the director was, is, or is threatened to be made a named defendant or
respondent (or otherwise becomes a party) by reason of such director's service
in that capacity or status as such, and the amount of every such judgement,
penalty, fine, settlement and reasonable expense so incurred by the director
shall be paid by the Corporation or, if paid by the director, reimbursed to the
director by the Corporation, subject only to the conditions and limitations
imposed by the applicable provisions of Section 2-418 of the Corporations and
Associations Article of the Annotated Code of the State of Maryland and by the
provisions of Section 17(h) of the United States Investment Company Act of 1940
as interpreted and as required to be implemented by Securities and Exchange
Commission Release No. IC-11330 of September 4, 1980. The foregoing shall not
limit the authority of the Corporation to indemnify any of its officers,
employees or agents to the extent consistent with applicable law.
<PAGE>
ARTICLE XI
AMENDMENTS
All By-Laws of the Corporation shall be subject to alteration,
amendment, or repeal, and new By-Laws not inconsistent with any provision of the
Articles of Incorporation of the Corporation may be made, either by the
affirmative vote of the holders of record of a majority of the outstanding stock
of the Corporation entitled to vote in respect thereof, given at an annual
meeting or at any special meeting, provided notice of the proposed alteration,
amendment, or repeal of the proposed new By-Laws is included in or accompanies
the notice of such meeting, or by the affirmative vote of a majority of the
whole Board of Directors given at a regular or special meeting of the Board of
Directors, provided that the notice of any such special meeting indicates that
the By-Laws are to be altered, amended, repealed, or that new By-Laws are to be
adopted.
CONSENT OF INDEPENDENT AUDITORS
Lord Abbett U.S. Government Securities Money Market Fund, Inc.:
We consent to the incorporation by reference in Post-Effective Amendment No. 24
to Registration Statement No. 2-64536 of our report dated July 31, 1998
appearing in the Annual Report to Shareholders for the year ended June 30, 1998,
and to the reference to us under the caption "Financial Highlights" in the
Prospectus and to the references to us under the captions "Investment Advisory
and Other Services" and "Financial Statements" in the Statement of Additional
Information, both of which are part of such Registration Statement.
DELOITTE & TOUCHE LLP
New York, New York
October 26, 1998
<TABLE> <S> <C>
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<NAME> US GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
<SERIES>
<NUMBER> 001
<NAME> CLASS A
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 145257582
<INVESTMENTS-AT-VALUE> 145257582
<RECEIVABLES> 226945
<ASSETS-OTHER> 3718
<OTHER-ITEMS-ASSETS> 165175
<TOTAL-ASSETS> 145653420
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1365841
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