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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
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Pre-Effective Amendment No. 1
Post-Effective Amendment No. ____
(check appropriate box or boxes)
FRANK RUSSELL INVESTMENT COMPANY
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(Exact Name of Registrant as Specified in Charter)
(253) 627-7001
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(Area Code and Telephone Number)
909 A Street
Tacoma, WA 98402
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(Address of Principal Executive Offices--
Number, Street, City, State, Zip Code)
Gregory J. Lyons, Esquire
Assistant Secretary
909 A Street, Tacoma WA 98402
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(Name and Address of Agent for Service--
Number, Street, City, State, Zip Code)
Copies to:
Steven M. Felsenstein, Esquire
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103
Approximate Date of Proposed Public Offering: As soon as
practicable after this Registration Statement becomes effective
under the Securities Act of 1933.
Title of Securities Being Registered: Shares of Beneficial Interest, $0.01 Par
Value Per Share
No filing fee is due because of reliance on Section 24(f) of the Investment
Company Act of 1940. Pursuant to Rule 429(a), this Registration Statement
relates to shares previously registered on Form N-1A (Securities Act of 1933
File No. 002-71299; Investment Company Act of 1940 File No. 811-03153).
The Registrant has requested that the staff accelerate the effective date
of this amendment and the original filing at the earliest possible time.
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FRANK RUSSELL INVESTMENT COMPANY
CROSS REFERENCE SHEET
(Pursuant to Rule 481(a) under the
Securities Act of 1933)
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N-14 Item No. and Caption Location in Prospectus
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PART A
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1. Beginning of Registration Statement and Outside Cover Page of Registration Statement; Front Cover
Front Cover Page of Prospectus Page of Prospectus
2. Beginning and Outside Back Cover Page of Table of Contents
Prospectus
3. Fee Table, Synopsis Information and Risk Factors Summary; Risk Factors
4. Information About the Transaction Summary; Reasons for the Reorganization;
Information About the Reorganization
5. Information About the Registrant Prospectus Cover Page; Summary; Comparison of
Investment Policies and Risks of the Bond Fund
and the Fixed Income Fund; Information About
Frank Russell Investment Company
6. Information About the Company Being Acquired Prospectus Cover Page; Comparison of Investment
Policies and Risks of the Bond Fund and the Fixed
Income Fund; Additional Matters Regarding the
Frank Russell Investment Company; Other
Information Relating to the Frank Russell
Investment Company
7. Voting Information Prospectus Cover Page; Notice of Special Meeting
of Shareholders; Solicitation and Revocation of
Proxies and Voting Information; Principal
Shareholders; Summary-Voting Information
8. Interest of Certain Persons and Experts None
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9. Additional Information Required for Reoffering Not Applicable
by Persons Deemed to be Underwriters
N-14 Item No. and Caption Location in Prospectus
Additional Information
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PART B
10. Cover Page Cover Page of Statement of Additional Information
11. Table of Contents Not Applicable
12. Additional Information Incorporation of Documents by Reference in the
about the Registrant Statement of Additional Information
13. Additional Information Incorporation of Documents by Reference in the
about the Company Being Acquired Statement of Additional Information
14. Financial Statements Incorporation of Documents by Reference in the
Statement of Additional Information
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PART C
OTHER INFORMATION
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Part C contains information that supplements the exhibits that were filed with
the Registrant's N-14 Registration Statement filed with the SEC on September 17,
1998.
Exhibit
11. An opinion of counsel as to the legality of the securities being
registered indicating whether they will, when sold, be legally issued,
full paid and nonassessable. Opinion of counsel is attached hereto as
Exhibit 11.
12. Form of proposed tax opinion from counsel supporting the tax consequences
of the reorganization of the Acquired Portfolio and the Acquiring
Portfolio. Opinion of counsel is attached as hereto as Exhibit. 12.
Item 17. Undertakings
(1) The undersigned Registrant agrees to file by post-effective filing
a final copy of the Form of Tax Opinion set forth in Exhibit 12, when
it becomes final and is executed and received by the Registrant.
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SIGNATURES
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As required by the Securities Act of 1933, this Registration Statement has
been signed on behalf of the Registrant, by the undersigned, thereunto duly
authorized, in the City of Tacoma and the State of Washington, on the 19th day
of October, 1998.
FRANK RUSSELL INVESTMENT COMPANY
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(Registrant)
By: /s/ Lynn Anderson
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Lynn L. Anderson
President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
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/s/ Lynn L. Anderson Chief Executive Officer and Trustee
- - --------------------- Dated: October 19, 1998
Lynn L. Anderson
George F. Russell* Trustee and Chairman of the Board
- - --------------------- Dated: October 19, 1998
George F. Russell
/s/Mark E. Swanson Treasurer and Chief Accounting Officer
- - --------------------- Dated: October 19, 1998
Mark E. Swanson
Paul E. Anderson* Trustee
- - --------------------- Dated: October 19, 1998
Paul E. Anderson
Paul Anton* Trustee
- - --------------------- Dated: October 19, 1998
Paul Anton
William E. Baxter* Trustee
- - --------------------- Dated: October 19, 1998
William E. Baxter
Lee C. Gingrich* Trustee
- - --------------------- Dated: October 19, 1998
Lee C. Gingrich
Eleanor W. Palmer* Trustee
- - --------------------- Dated: October 19, 1998
Eleanor W. Palmer
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By* /s/ Gregory J. Lyons
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Gregory J. Lyons. Attorney-in-Fact
(Pursuant to Powers of Attorney filed herewith)
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EXHIBIT INDEX
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EXHIBIT NO. DOCUMENT
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11 Opinion of Counsel
12 Form of Tax Opinion
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EXHIBIT 11
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, Pennsylvania 19103
Direct dial: (215) 564-8074
October 16, 1998
Board of Trustees
Frank Russell Investment Company
909 A Street
Tacoma, Washington 98402
RE: AGREEMENT AND PLAN OF REORGANIZATION FOR THE FRANK RUSSELL
INVESTMENT COMPANY, A MASSACHUSETTS BUSINESS TRUST (THE "TRUST"),
ON BEHALF OF THE FIXED INCOME II FUND (THE "ACQUIRING PORTFOLIO")
OF THE TRUST, AND ON BEHALF OF THE VOLATILITY CONSTRAINED BOND
FUND (THE "ACQUIRED PORTFOLIO") OF THE TRUST, DATED AS OF
NOVEMBER 20, 1998
Ladies and Gentlemen:
You have requested our opinion as to certain matters relating to the
reorganization of the Acquired Portfolio and the Acquiring Portfolio (the
"Reorganization") which is presently anticipated to occur on or about February
1, 1999. The Reorganization will involve the transfer of all the assets of the
Acquired Portfolio to the Acquiring Portfolio, and the assumption of the
liabilities of the Acquired Portfolio by the Acquiring Portfolio. In exchange
for the foregoing, Class S shares of the Acquiring Portfolio will be distributed
to shareholders of the Acquired Portfolio, following which the Acquired
Portfolio will be dissolved.
In rendering our opinion, we have reviewed and relied upon:
A. The Agreement and Plan of Reorganization, made as of November 19,
1998, by and between the Acquired Portfolio and the Acquiring Portfolio (the
"Agreement");
B. The registration statement and proxy materials filed by the Trust on
Form N-14 as provided to shareholders of the Acquired Portfolio in connection
with the Special Meeting in Lieu of Annual Meeting of Shareholders of the
Acquired Portfolio held November 19, 1998;
C. Certain representations concerning the Reorganization which will be
confirmed to us by the Acquired Portfolio and the Acquiring Portfolio in a
letter dated as of the business day before the closing date (the "Representation
Letter");
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D. All other documents, financial and other reports and corporate minutes
which we deemed relevant or appropriate; and
E. A certificate of good standing issued by the Commonwealth of
Massachusetts; and
F. Such statutes, regulations, and interpretations of the U.S. Securities
and Exchange Commission as we deemed material to the rendition of this opinion.
All terms used herein, unless otherwise defined, are used as defined in the
Agreement.
We have assumed and will assume, and therefore not verify independently the
authenticity of all documents submitted to us as originals and the conformity to
original documents of all documents submitted to us as certified or photostatic
copies. Other than our review of the documents set forth above, we have not
reviewed any other documents or made any independent investigation for the
purpose of rendering this opinion and we make no representations as to the scope
or sufficiency of our document review for your purpose.
Based on the foregoing and subject to the receipt of the Representation
Letter on the Closing Date in the form agreed by the Trust, and provided the
Reorganization is approved by the shareholders of the Trust and carried out in
accordance with the applicable laws of the Commonwealth of Massachusetts, the
Agreement, and the Representation Letter, it is our opinion that as of the date
hereof:
(1) The Trust will be a Massachusetts business trust duly organized
and validly existing under the laws of the Commonwealth of Massachusetts;
(2) The shares of the Acquired Portfolio outstanding at the Effective
Time of the Reorganization will be duly authorized, validly issued, fully paid
and non-assessable by the Acquired Portfolio, and to our knowledge no
shareholder of the Acquired Portfolio will have any option, warrant or
preemptive right to subscription or purchase with respect to the shares of the
Acquired Portfolio;
(3) The Agreement and the Transfer Documents will have been duly
authorized, executed and delivered by the Acquired Portfolio and will represent
its legal, valid and binding contracts or instruments, enforceable against the
Acquired Portfolio in accordance with their terms, subject to the effect of
bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws
relating to or affecting creditors' rights generally and court decisions with
respect thereto, and we express no opinion with respect to the application of
equitable principles in any proceeding, whether at law or in equity, or with
respect to the provisions of the Agreement intended to limit liability for
particular matters to the Acquired Portfolio and its assets;
(4) The execution and delivery of the Agreement will not, and the
consummation of the transactions contemplated by the Agreement will not, violate
the Trust Agreement or By-Laws of the Trust or any material agreement known to
us aa of this date to which the Trust is a party or by which the Trust is bound;
(5) To our knowledge, no consent, approval, authorization or order of
any court or governmental authority will be required for the consummation by the
Acquired Portfolio of the
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transactions contemplated by the Agreement, except such as have been obtained
under the 1933 Act, the 1934 Act, the 1940 Act, the rules and regulations under
those Acts, and such as may be required under state securities laws;
(6) The Class S Shares of the Acquiring Portfolio to be delivered at
such time to the Acquired Portfolio as provided in the Agreement will be duly
authorized and upon delivery will be validly issued, fully paid and non-
assessable by the Acquiring Portfolio, and to our knowledge no shareholder of
the Acquiring Portfolio has any option, warrant or preemptive right to
subscription or purchase with respect to the shares of the Acquiring Portfolio;
(7) The Agreement will have been duly authorized, executed and
delivered by the Acquiring Portfolio and represents its legal, valid and binding
contract, enforceable against the Acquiring Portfolio in accordance with its
terms, subject to the effect of bankruptcy, insolvency, moratorium, fraudulent
conveyance and similar laws relating to or affecting creditors' rights generally
and court decisions with respect thereto, and we express no opinion with respect
to the application of equitable principles in any proceeding, whether at law or
in equity, or with respect to the provisions of the Agreement intended to limit
liability for particular matters to the Acquiring Portfolio and its assets; and
(8) To our knowledge, no consent, approval, authorization or order of
any court or governmental authority will be required for the consummation by the
Acquiring Portfolio and the Acquired Portfolio of the transactions contemplated
by the Agreement, except such as have been obtained under the 1933 Act, the 1934
Act, the 1940 Act, the rules and regulations under those Acts and such as may be
required under state securities laws.
The foregoing opinions are given only with respect to laws, regulations or
orders which are presently in effect. We assume no obligation to update or
supplement this opinion to reflect any facts or circumstances which may
hereafter occur whether the same are retroactively or prospectively applied.
This opinion is being rendered to the Acquired Portfolio and the Acquiring
Portfolio and may be relied upon only by the Acquired Portfolio and the
Acquiring Portfolio and the shareholders of each and may not be published by the
Acquired Portfolio and the Acquiring Portfolio or relied upon in any respect by
any third party, without the prior written consent of a partner in this law
firm.
Very truly yours,
STRADLEY, RONON, STEVENS & YOUNG, LLP
Steven M. Felsenstein, a Partner
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EXHIBIT 12
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, Pennsylvania 19103
Direct dial: (215) 564-8124
DRAFT
February , 1999
Board of Trustees
Frank Russell Investment Company
909 A Street
Tacoma, Washington 98402
RE: AGREEMENT AND PLAN OF REORGANIZATION MADE AS OF NOVEMBER 20, 1998
BY FRANK RUSSELL INVESTMENT COMPANY, A MASSACHUSETTS BUSINESS
TRUST (THE "TRUST ), ON BEHALF OF THE VOLATILITY CONSTRAINED BOND
FUND (THE "ACQUIRED PORTFOLIO") OF THE TRUST, AND ON BEHALF OF
THE FIXED INCOME II FUND (THE "ACQUIRING PORTFOLIO") OF THE TRUST
Ladies and Gentlemen:
You have requested our opinion as to certain federal income tax
consequences of the reorganization of the Acquired Portfolio and the Acquiring
Portfolio (the "Reorganization"). The Reorganization will involve the transfer
of all the assets of the Acquired Portfolio to the Acquiring Portfolio, and the
assumption of the liabilities of the Acquired Portfolio by the Acquiring
Portfolio. In exchange for the foregoing, Class S shares of the Acquiring
Portfolio will be distributed to shareholders of the Acquired Portfolio,
following which the Acquired Portfolio will be dissolved.
In rendering our opinion, we have reviewed and relied upon (a) the
Agreement and Plan of Reorganization, made as of November 20, 1998, by and
between the Acquired Portfolio and the Acquiring Portfolio (the "Agreement"),
(b) the Form N-14 Registration Statement and Proxy Statement provided to
stockholders of the Acquired Portfolio in connection with the Special Meeting in
Lieu of Annual Meeting of Stockholders of the Acquired Portfolio held November
20, 1998, (c) certain representations concerning the Reorganization made to us
by the Acquired Portfolio and the Acquiring Portfolio in a letter dated as of
November 20, 1998 (the "Representation Letter"), (d) all other documents,
financial and other reports and corporate minutes which we deemed relevant or
appropriate, and (e) such statutes, regulations, rulings and decisions as we
deemed material to the rendition of this opinion. All terms used herein, unless
otherwise defined, are used as defined in the Agreement.
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For purposes of this opinion, we have assumed that the Acquired Portfolio
on the effective date of the Reorganization satisfies, and following the
Reorganization, the Acquiring Portfolio will continue to satisfy, the
requirements of subchapter M of the Internal Revenue Code of 1986, as amended
(the "Code"), for qualification as a regulated investment company.
Under regulations to be prescribed by the Secretary of Treasury under
Section 1276(d) of the Code, certain transfers of market discount bonds will be
excepted from the requirement that accrued market discount be recognized on
disposition of a market discount bond under Section 1276(a) of the Code. Such
regulations are to provide, in part, that accrued market discount will not be
included in income if no gain is recognized under Section 361(a) of the Code
where a bond is transferred in an exchange qualifying as a tax-free
reorganization. As of the date hereof, the Secretary has not issued any
regulations under Section 1276 of the Code.
Based on the foregoing and provided the Reorganization is carried out in
accordance with the applicable laws of the Commonwealth of Massachusetts, the
Agreement and the Representation Letter, it is our opinion that:
1. The Reorganization with respect to the Acquired Portfolio and the
Acquiring Portfolio will constitute a tax-free reorganization within the meaning
of Section 368(a)(1)(C) of the Code and both the Acquired Portfolio and the
Acquiring Portfolio will be a party to the reorganization within the meaning of
Section 368(b) of the Code.
2. No gain or loss will be recognized by the Acquired Portfolio upon the
transfer of all of its assets to and assumption of the liabilities by the
Acquiring Portfolio in exchange solely for Class S shares of the Acquiring
Portfolio pursuant to Section 361(a) and Section 357(a) of the Code. We express
no opinion as to whether any accrued market discount will be required to be
recognized as ordinary income pursuant to Section 1276 of the Code.
3. No gain or loss will be recognized by the Acquiring Portfolio upon the
receipt by it of all of the assets of the Acquired Portfolio in exchange solely
for Class S shares of the Acquiring Portfolio pursuant to Section 1032(a) of the
Code.
4. The basis of the assets of the Acquired Portfolio received by the
Acquiring Portfolio will be the same as the basis of such assets to the Acquired
Portfolio immediately prior to the exchange pursuant to Section 362(b) of the
Code.
5. The holding period of the assets of the Acquired Portfolio received by
the Acquiring Portfolio will include the period during which such assets were
held by the Acquired Portfolio pursuant to Section 1223(2) of the Code.
6. No gain or loss will be recognized by the shareholders of the Acquired
Portfolio upon the exchange of their shares in the Acquired Portfolio for Class
S shares of the Acquiring Portfolio (including fractional shares to which they
may be entitled), pursuant to Section 354(a) of the Code.
7. The basis of the Class S shares in the Acquiring Portfolio received by
the shareholders of the Acquired Portfolio (including fractional shares to which
they may be
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entitled) will be the same as the basis of the shares of the Acquired Portfolio
exchanged therefor pursuant to Section 358(a)(1) of the Code.
8. The holding period of the Class S shares of the Acquiring Portfolio
received by the shareholders of the Acquired Portfolio (including fractional
shares to which they may be entitled) will include the holding period of the
shares of the Acquired Portfolio surrendered in exchange therefor, provided that
the shares of the Acquired Portfolio were held as a capital asset on the
effective date of the Reorganization, pursuant to Section 1223(1) of the Code.
9. The Acquiring Portfolio will succeed to and take into account as of the
date of the proposed transfer the items of the Acquired Portfolio described in
Section 381(c) of the Code as provided in Section 1.381(b)-1(a)(2) of the Income
Tax Regulations.
Our opinion is based upon the Code, the applicable Treasury Regulations
promulgated thereunder, the present position of the Internal Revenue Service as
set forth in published revenue rulings and revenue procedures, present
administrative positions of the Internal Revenue Service, and existing judicial
decisions, all of which are subject to change either prospectively or
retroactively. We do not undertake to make any continuing analysis of the facts
or relevant law following the date of this opinion.
Our opinion is conditioned upon the performance by the Acquired Portfolio
and the Acquiring Portfolio of their undertakings in the Representation Letter.
This opinion is being rendered to the Acquired Portfolio and the Acquiring
Portfolio and may be relied upon only by the Acquired Portfolio and the
Acquiring Portfolio and the shareholders of each.
Very truly yours,
STRADLEY, RONON, STEVENS & YOUNG, LLP
DRAFT
William P. Zimmerman, a Partner
