As filed with the Securities and Exchange Commission
on June 2, 1997
Securities Act File No. 33-4959
Investment Company Act File No. 811-6880
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 23 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 25 [X]
(Check appropriate box or boxes)
THE ALGER FUND
-------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
75 MAIDEN LANE
NEW YORK, NEW YORK 10038
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 212-806-8800
MR. GREGORY S. DUCH
FRED ALGER MANAGEMENT, INC.
75 MAIDEN LANE
NEW YORK, NY 10038
- --------------------------------------------------------------------------------
(Name and Address of Agent for Service)
Page 1 of _____ Pages
Exhibit Index at Page ______
<PAGE>
It is proposed that this filing will become effective (check appropriate box):
[ ] immediately upon filing pursuant to paragraph (b), or
[ ] on [December 31, 1996] pursuant to paragraph (b), or
[X] 60 days after filing pursuant to paragraph (a), or
[ ] on [date] pursuant to paragraph (a) of Rule 485
---------------
DECLARATION PURSUANT TO RULE 24f-2
Registrant has registered an indefinite number or amount of securities
under the Securities Act of 1933, as amended, pursuant to Rule 24f-2(a)(1) under
the Investment Company Act of 1940, as amended. The Rule 24f-2 Notice for
Registrant's fiscal year ended October 31, 1996 was filed on December 20, 1996.
<PAGE>
THE ALGER FUND
FORM N-1A
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
Part A
Item No. Prospectus Heading
- -------- ------------------
<S> <C>
1. Cover Page..................................... Front Cover Page
2. Synopsis ...................................... Portfolio Expenses
3. Condensed Financial Information ............... Financial Highlights
4. General Description of Registrant ............. Front Cover Page; Investment Objectives
and Policies; Investment Practices; Man-
agement of the Fund
5. Management of the Fund ........................ Management of the Fund
6. Capital Stock and Other Securities ............ Front Cover Page; Management of the
Fund; Dividends and Taxes
7. Purchase of Securities Being Offered .......... How to Purchase Shares; Special Investor
Services--Exchange Privilege
8. Redemption or Repurchase ...................... How to Sell Shares; How to Exchange
Shares
9. Pending Legal Proceedings ..................... Not Applicable
Part B Heading in Statement of
Item No. Additional Information
- -------- ----------------------
10. Cover Page .................................... Front Cover Page
11. Table of Contents ............................. Contents
12. General Information and History ............... Not Applicable
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
13. Investment Objectives and Policies ............ Investment Objectives and Policies;
Appendix
14. Management of the Fund ........................ Management
15. Control Persons and Principal Holders of
Securities .................................. Certain Shareholders
16. Investment Advisory and Other Services ........ Management; Custodian and Transfer
Agent; Purchases; See in the Prospectus
"Management of the Fund"
17. Brokerage Allocation and Other Practices ...... Investment Objectives and Policies
18. Capital Stock and Other Securities ............ Organization; See in the Prospectus "Div-
idends and Taxes" and "Management of
the Fund"
19. Purchase, Redemption and Pricing of Secu-
rities Being Offered ......................... Net Asset Value; Purchases; Redemp-
tions
20. Tax Status .................................... Taxes; See in the Prospectus "Taxes"
21. Underwriters .................................. Purchases
22. Calculation of Performance Data ............... Determination of Performance; See
in the Prospectus "Performance"
23. Financial Statements .......................... Financial Statements
Part C
- ------
Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C to this Registration Statement.
</TABLE>
<PAGE>
PROSPECTUS
- -----------------
THE| 75 MAIDEN LANE
ALGER| NEW YORK, NEW YORK 10038
FUND| (800)992-FUND (3863)
The Alger Fund offers interests in six Portfolios. Each Portfolio has distinct
investment objectives and policies which are discussed in the section entitled
"Investment Objectives and Policies." The six Portfolios are:
o Alger Money Market Portfolio
o Alger Small Capitalization Portfolio
o Alger MidCap Growth Portfolio
o Alger Growth Portfolio
o Alger Balanced Portfolio
o Alger Capital Appreciation Portfolio
With the exception of Alger Money Market Portfolio, each Portfolio offers three
classes of shares, each with a different combination of sales charges, ongoing
fees and other features.
This Prospectus, which should be retained for future reference, contains
important information that you should know before investing. A Statement of
Additional Information dated August 1, 1997 containing further information about
The Alger Fund has been filed with the Securities and Exchange Commission and is
incorporated by reference into this Prospectus. It is available at no charge by
contacting The Alger Fund at the address or phone number above.
TABLE OF CONTENTS
Page
-----
Introduction.................................................... i
Portfolio Expenses.............................................. ii
Financial Highlights............................................ vi
How to Purchase Shares.......................................... 1
How to Sell Shares.............................................. 5
Special Investor Services....................................... 7
Investment Objectives and Policies.............................. 8
Investment Practices............................................ 11
Management of the Fund.......................................... 12
Net Asset Value................................................. 14
Dividends and Taxes............................................. 15
Performance..................................................... 15
SHARES OF ALGER MONEY MARKET PORTFOLIO ARE NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT AND THERE IS NO ASSURANCE THAT ALGER MONEY MARKET PORTFOLIO WILL
BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE. SHARES OF THE
ALGER 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.
- -------------------------------------------------------------------------------
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 SECUR- ITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
AUGUST 1, 1997
<PAGE>
===============================================================================
INTRODUCTION
The Alger Fund's portfolios, other than Alger Money Market Portfolio, offer
three classes of shares having different sales charges, ongoing fees and other
features. You may purchase the class of shares that is most beneficial to you
based upon the amount of the purchase, the length of time you expect to hold
shares and other circumstances.
CLASS A SHARES
An investor purchasing Class A Shares may pay a sales charge at the time of
purchase. Class A Shares are not subject to a charge when they are redeemed
(except for shares purchased for total proceeds of $1 million or more, which
have no initial sales charge and which may be subject to a contingent deferred
sales charge ["CDSC"]). The initial sales charge may be reduced or waived for
certain purchases. Class A Shares are subject to a shareholder servicing fee
equal to an annual rate of .25% of the Portfolio's average daily net assets
attributable to its Class A Shares. See "How to Purchase Shares--Class A Share
Information."
CLASS B SHARES
Class B Shares have no initial sales charge, but may be subject to a CDSC of
up to 5% if you redeem within six years of purchase. They are subject to a
distribution (Rule 12b-1) fee of .75% of the Portfolio's average daily net
assets attributable to Class B Shares. Class B Shares also pay a shareholder
servicing fee calculated at an annual rate of .25% of the Portfolio's average
daily net assets attributable to its Class B Shares. Class B Shares provide an
investor the benefit of putting all of the investor's dollars to work from the
time the investment is made but will have a higher expense ratio and generally
will pay lower dividends than Class A Shares due to the distribution fee on
Class B Shares. Class B Shares will automatically convert to Class A Shares
eight years after the end of the calendar month in which the investor's order to
purchase was accepted. See "How to Purchase Shares--Class B Share Information."
CLASS C SHARES
There is no initial sales charge for Class C Shares, but they may be subject
to a CDSC of 1% if you redeem within the first year of purchase. They are
subject to a distribution (Rule 12b-1) fee of .75% of the Portfolio's average
daily net assets attributable to Class C Shares. In addition, an annual
shareholder servicing fee calculated at an annual rate of .25% of the
Portfolio's average daily net assets attributable to its Class C Shares will be
paid by Class C shareholders. Class C Shares provide an investor the benefit of
putting all of the investor's dollars to work from the time the investment is
made but will have a higher expense ratio and generally will pay lower dividends
than Class A Shares due to the distribution fee on Class C Shares. Class C
Shares will automatically convert to Class A Shares twelve years after the end
of the calendar month in which the investor's order to purchase was accepted.
See "How to Purchase Shares--Class C Share Information."
===============================================================================
i
<PAGE>
===============================================================================
PORTFOLIO EXPENSES
The table below is designed to assist you in understanding the direct and
indirect costs and expenses that you will bear as a shareholder. The Example
beginning on page iv shows the amount of expenses you would pay on a $1,000
investment in each class of shares of the Portfolios. These amounts assume the
reinvestment of all dividends and distributions, payment of any applicable
initial sales charge or contingent deferred sales charge and payment by the
Portfolios of operating expenses as shown in the table under Annual Fund
Operating Expenses. The Example is an illustration only and actual expenses may
be greater or less than those shown.
<TABLE>
<CAPTION>
ALGER ALGER ALGER
MONEY MARKET BALANCED GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------------------------ -------------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
------- ------- ------- ------- ------- -------
SHAREHOLDER TRANSACTION EXPENSES
<S> <C> <C> <C> <C> <C> <C> <C>
Maximum Sales Charge Imposed
on Purchases (as a percentage of
offering price)(a)(b) .................. None 4.75% None None 4.75% None None
Maximum Sales Charge Imposed on
Reinvested Dividends ................... None None None None None None None
Maximum Contingent Deferred
Sales Charge (as a percentage of
redemption proceeds)(b) ............... None None 5.00% 1.00% None 5.00% 1.00%
Redemption Fees ......................... None None None None None None None
Exchange Fees ........................... None None None None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees ........................ .50% .75% .75% .75% .75% .75% .75%
Rule 12b-1 Fees(c) .................... None None .75% .75% None .75% .75%
Other Expenses (d)(e)(f) .............. .29% 1.20% 1.20% 1.20% .58% .58% .58%
--- ---- ---- ---- ---- ---- ----
Total Fund Expenses (c)(d) ........... .79% 1.95% 2.70% 2.70% 1.33% 2.08% 2.08%
=== ==== ==== ==== ==== ==== ====
</TABLE>
===============================================================================
ii
<PAGE>
===============================================================================
PORTFOLIO EXPENSES (CONTINUED)
<TABLE>
<CAPTION>
ALGER MIDCAP ALGER ALGER
GROWTH SMALL CAPITALIZATION CAPITAL APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO
------------------------- --------------------------- ---------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
------- ------- ------- ------- ------- ------- ------- ------- ------
SHAREHOLDER TRANSACTION EXPENSES
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Maximum Sales Charge Imposed
on Purchases (as a percentage of
offering price)(a)(b)................. 4.75% None None 4.75% None None 4.75% None None
Maximum Sales Load Imposed on
Reinvested Dividends.................. None None None None None None None None None
Maximum Contingent Deferred
Sales Charge (as a percentage of
redemption proceeds)(b)............... None 5.00% 1.00% None 5.00% 1.00% None 5.00% 1.00%
Redemption Fees......................... None None None None None None None None None
Exchange Fees........................... None None None None None None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees......................... .80% .80% .80% .85% .85% .85% .85% .85% .85%
Rule 12b-1 Fees(c)...................... None .75% .75% None .75% .75% None .75% .75%
Other Expenses (d)(e)(f)................ .72% .72% .72% .53% .53% .53% .86% .86% .86%
---- ---- ---- ---- ---- ---- ---- ---- ----
Total Fund Expenses .................... 1.52% 2.27% 2.27% 1.38% 2.13% 2.13% 1.71% 2.46% 2.46%
==== ==== ==== ==== ==== ==== ==== ==== ====
</TABLE>
(a) The sales charge applicable to Class A Shares set forth in the above table
is the maximum charge imposed upon the purchase of shares. Shareholders
may pay less than 4.75% depending on the amount invested in Class A Shares
of the Fund. See "How to Purchase Shares--Class A Share Information."
(b) Class A purchases of $1 million or more are not subject to an initial
sales charge; however, a contingent deferred sales charge of 1% may be
imposed on certain redemptions within one year following such purchases.
See "How to Purchase Shares--Class A Share Information." For Class B
purchases, the amount of the contingent deferred sales charge, if
applicable, will depend on the number of years since the shareholder made
the purchase payment. See "How to Purchase Shares--Class B Share
Information." For Class C purchases, a contingent deferred sales charge of
1% may be imposed on redemptions within one year following purchase. See
"How to Purchase Shares--Class C Share Information."
(c) The Alger Fund pays Fred Alger & Company, Incorporated for its services in
distributing Class B and Class C Shares of each Portfolio other than Alger
Money Market Portfolio at the maximum annual rate of .75% of the class's
average daily net assets. Long-term shareholders paying Rule 12b-1 fees
pursuant to The Alger Fund's plan of distribution may pay more than the
economic equivalent of the maximum front-end sales charges permitted by
the rules of the National Association of Securities Dealers, Inc.
(d) Included in Other Expenses of Alger Capital Appreciation Portfolio is
0.02% of interest expense.
(e) Other Expenses for Alger Money Market Portfolio have been restated to
reflect current fees.
(f) Other Expenses for a Portfolio's Class A and Class C Shares are estimated
on the basis of amounts incurred by the Portfolio's Class B Shares during
its most recent fiscal year.
===============================================================================
iii
<PAGE>
===============================================================================
PORTFOLIO EXPENSES (CONTINUED)
<TABLE>
<CAPTION>
ALGER ALGER ALGER
MONEY MARKET BALANCED GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------------------------ ------------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
------- ------- ------- ------- ------- -------
EXAMPLE
You would pay the following
expenses on a $1,000
investment including
the maximum sales
charges and assuming
(1) 5% annual return and
(2) redemption at the end of
each time period:
<S> <C> <C> <C> <C> <C> <C> <C>
One Year ....................... $ 8 $ 66 $ 77 $ 37 $ 60 $ 71 $ 31
Three Years .................... 25 106 114 84 88 95 65
Five Years ..................... 44 148 163 143 117 132 112
Ten Years ...................... 98 264 303 303 200 241 241
You would pay the following
expenses on the same
investment, assuming no
redemption at the end
of each time period:
One Year ....................... $ 8 $ 66 $ 27 $ 27 $ 60 $ 21 $ 21
Three Years .................... 25 106 84 84 88 65 65
Five Years ..................... 44 148 143 143 117 112 112
Ten Years ...................... 98 264 303 303 200 241 241
</TABLE>
===============================================================================
iv
<PAGE>
===============================================================================
PORTFOLIO EXPENSES (CONTINUED)
<TABLE>
<CAPTION>
ALGER MIDCAP ALGER ALGER
GROWTH SMALL CAPITALIZATION CAPITAL APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO
----------------------------- --------------------------- ---------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
------- ------- ------- ------- ------- ------- ------- ------- -------
EXAMPLE
You would pay the following
expenses on a $1,000 investment
including the maximum sales
charges and assuming
(1) 5% annual return and
(2) redemption at the end of
each time period:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
One Year ........................... $ 62 $ 73 $ 33 $ 61 $ 72 $ 32 $ 64 $ 75 $ 35
Three Years......................... 93 101 71 89 97 67 99 107 77
Five Years.......................... 126 142 122 119 134 114 136 151 131
Ten Years........................... 220 261 261 205 246 246 240 280 280
You would pay the following
expenses on the same
investment, assuming no
redemption at the end
of each time period:
One Year............................ $ 62 $ 23 $ 23 $ 61 $ 22 $22 $ 64 $ 25 $ 25
Three Years......................... 93 71 71 89 67 67 99 77 77
Five Years.......................... 126 122 122 119 114 114 136 131 131
Ten Years........................... 220 261 261 205 246 246 240 280 280
</TABLE>
===============================================================================
v
<PAGE>
===============================================================================
FINANCIAL HIGHLIGHTS
The Financial Highlights for the years ended October 31, 1990 through 1996 have
been audited by Arthur Andersen LLP, The Alger Fund's (the "Fund") independent
public accountants. This information should be read in conjunction with the
financial statements of the Fund contained in its Annual Report, which financial
statements are incorporated by reference in the Statement of Additional
Information. An Annual Report of the Fund is available by contacting the Fund at
(800) 992-3863. In addition to financial statements, the Annual Report contains
further information about the performance of the Fund. The Financial Highlights,
with the exception of the total return information, for the two years ended
October 31, 1989 and the period from November 11, 1986 (commencement of
operations) to October 31, 1987, have been audited by other independent
accountants, who have expressed an unqualified opinion thereon.
THE ALGER FUND
MONEY MARKET PORTFOLIO
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED OCTOBER 31,
ENDED APRIL 30, -------------------------------------------------------------
1997(i),(ii) 1996 1995 1994 1993 1992
---------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year....... $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------- --------- --------- --------- --------- ---------
Net investment income.................... .0521 .0573 .0374 .0304 .0424
Dividends from net investment
income................................ (.0521) (.0573) (.0374) (.0304) (.0424)
------- --------- --------- --------- --------- ---------
Net asset value, end of year............. $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
======= ========= ========= ========= ========= =========
Total Return ............................ 5.3% 5.9% 3.8% 3.1% 4.3%
======= ========= ========= ========= ========= =========
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)...................... $285,702 $185,822 $163,170 $ 126,567 $ 135,288
======= ========= ========= ========= ========= =========
Ratio of expenses to average net
assets............................... .41%(ii) .29%(ii) .27%(iii) .41%(iii) .25%(iii)
======= ========= ========= ========= ========= =========
Decrease reflected in above
expense ratios due to expense
reimbursements and
management fee waivers.............. .38% .50% .50% .50% .60%
======= ========= ========= ========= ========= =========
Ratio of net investment income
to average net assets............... 5.18% 5.73% 3.78% 3.04% 4.30%
======= ========= ========= ========= ========= =========
</TABLE>
===============================================================================
vi
<PAGE>
===============================================================================
<TABLE>
<CAPTION>
FROM
NOVEMBER 11, 1986
(COMMENCEMENT
OF OPERATIONS)
YEAR ENDED OCTOBER 31, THROUGH
----------------------------------------------------- OCTOBER 31,
1991 1990 1989 1988 1987(i)
----- ----- ----- ----- ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year................ $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
--------- --------- --------- --------- ---------
Net investment income............................. .0671 .0844 .0927 .0732 .0541
Dividends from net investment
income......................................... (.0671) (.0844) (.0927) (.0732) (.0541)
--------- --------- --------- --------- ---------
Net asset value, end of year...................... $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
========= ========= ========= ========= =========
Total Return ..................................... 6.9% 8.8% 9.7%(i) 7.6%(i) 5.6%(i)
========= ========= ========= ========= =========
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)............................... $ 160,898 $ 143,420 $ 69,581 $ 11,509 $ 4,247
========= ========= ========= ========= =========
Ratio of expenses to average net
assets........................................ .18%(iii) .03%(iii) --(iii) --(iii) .64%(iii)
========= ========= ========= ======== =========
Decrease reflected in above
expense ratios due to expense
reimbursements and
management fee waivers........................ .63% .84% .93% 1.73% 1.88%
========= ======= ========= ========= =========
Ratio of net investment income
to average net assets......................... 6.76% 8.37% 9.45% 7.16% 5.82%
========= ======== ========= ========= =========
</TABLE>
(i)Ratios have been annualized; total return has not been annualized.
(ii)Unaudited.
(iii)Reflects total expenses including fees offset by earnings credits. The
expense ratios net of earnings credits would have been 0.40%, and 0.27% for
the years ended October 31, 1996 and 1995, respectively.
(iv)Expense ratios for the periods ended prior to October 31, 1995 do not
reflect the effect of fees offset by earnings credits, if any.
===============================================================================
vii
<PAGE>
===============================================================================
THE ALGER FUND
BALANCED PORTFOLIO
Financial Highlights (i)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
CLASS A CLASS B
--------- -------------------------------------------------------------------------------
FROM
JUNE 1, 1992
FOUR MONTHS SIX MONTHS (COMMENCEMENT
ENDED ENDED YEAR ENDED OCTOBER 31, OF OPERATIONS)
APRIL 30, APRIL 30, --------------------------------------------- TO OCTOBER 31,
1997(ii,vii) 1997(ii,vii) 1996 1995 1994 1993 1992(ii)
---------- ------------ ----- ----- ----- ----- ---------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of year........................ $ 13.59 $ 10.65 $ 11.18 $ 9.95 $ 10.00
---------- ------------ -------- -------- -------- -------- --------
Net investment income (loss)..... .12 (.02)(iv) (.05) (.01) (.12)
Net realized and unrealized
gain (loss) on investments..... .72 2.96 (.39) 1.24 .07
---------- ------------ -------- -------- -------- -------- --------
Total from investment operations. .84 2.94 (.44) 1.23 (.05)
---------- ------------ -------- -------- -------- -------- --------
Dividends from net investment
income........................ (.01) -- -- -- --
Distributions from net realized
gains......................... (.21) -- (.09) -- --
---------- ------------ -------- -------- -------- -------- --------
Total Distributions.............. (.22) -- (.09) -- --
---------- ------------ -------- -------- -------- -------- --------
Net asset value, end of year..... $ 14.21 $ 13.59 $ 10.65 $ 11.18 $ 9.95
========== ============ ======== ======== ========= ======== ========
Total Return (iii)............... 6.3% 27.6% (4.0%) 12.4% (0.5%)
========== ============ ======== ======== ========= ======== ========
Ratios and Supplemental Data:
Net assets, end of year (000's
omitted)..................... $ 13,492 $ 6,214 $ 3,073 $ 3,125 $ 1,370
========== ============ ======== ======== ========= ========= ========
Ratio of expenses to average
net assets................... 2.70%(v) 3.34%(v) 3.18%(vi) 3.82%(vi) 5.62%(vi)
========== ============ ======== ======== ========= ========= ========
Decrease reflected in above
expense ratios due to
expense reimbursements.......... -- .24% -- .75% .75%
========== ============ ======== ======== ========= ========= ========
Ratio of net investment income
(loss) to average net assets... .47% (.13%) (.41%) (.97%) (3.07%)
========== ============ ======== ======== ========= ========= ========
Portfolio Turnover Rate........... 85.51% 84.06% 84.88% 115.17% 17.07%
========== ============ ======== ======== ========= ========= ========
Average Commission Rate Paid...... $ .0700
========== ============ ========
</TABLE>
(i)Class C Shares were not offered during the periods shown. Class A Shares
were not offered prior to December 31, 1996.
(ii)Ratios have been annualized;
total return has not been annualized.
(iii)Does not reflect the effect of any sales charges.
(iv)Amount was computed based on average shares outstanding during the period.
(v)Reflects total expenses, including fees offset by earnings credits. The
expense ratios net of earnings credits would have been 2.69% and 3.25% for
the years ended October 31, 1996 and 1995, respectively.
(vi)Expense ratios for the periods ended prior to October 31, 1995, do not
reflect the effect of fees offset by earnings credits, if any.
(vii)Unaudited.
===============================================================================
viii
<PAGE>
===============================================================================
THE ALGER FUND
MIDCAP GROWTH PORTFOLIO
Financial Highlights (i)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
<TABLE>
<CAPTION>
CLASS A CLASS B
------------------------- -----------------------------------------------------
FOUR MONTHS SIX MONTHS FROM
ENDED ENDED MAY 24, 1993
APRIL 30, APRIL 30, YEAR ENDED OCTOBER 31, (COMMENCEMENT
----------------------------- OF OPERATIONS)
1997 (ii, viii) 1997 (ii, viii) 1996 1995 1994 TO OCTOBER 31, 1993(ii)
--------------- -------------- ------- ------- ------- -----------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of year....................... $ 18.94 $ 12.77 $ 12.48 $ 10.00
------ ------ -------- ------- ------ -------
Net investment (loss)........... (.25)(v) (.08) (.11) (.09)
Net realized and unrealized
gain on investments........... 1.35 6.25 .68 2.57
------ ------ -------- ------- ------ -------
Total from investment
operations.... ............. 1.10 6.17 .57 2.48
Distribution from net
realized gains.. ........... (1.17) -- (.28) --
------ ------ --------- ------- ------ -------
Net asset value, end of year... $ 18.87 $ 18.94 $ 12.77 $ 12.48
====== ====== ========= ======= ====== =======
Total Return (iii)............. 6.4 % 48.3 % 4.7 % 24.8 %
====== ====== ========= ======= ====== =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted) .......... $125,686 $ 54,016 $ 18,516 $ 3,836
====== ====== ========= ======== ======= =======
Ratio of expenses to average
net assets .............. 2.27%(iv) 2.39%(iv) 3.20%(vi) 3.73%(vi)
====== ====== ========= ======== ======= =======
Decrease reflected in above
expense ratio due to
expense reimbursements.... -- -- .07% .80%
====== ====== ========= ======== ======= =======
Ratio of net investment
income (loss) to average
net assets................ (1.33%) (1.71%) (2.32%) (2.86%)
====== ====== ========= ======= ======= =======
Portfolio Turnover Rate..... 113.95% 121.60% 127.40% 57.64%
====== ====== ========= ======= ======= =======
Average Commission
Rate Paid....... $ .0690
=========
</TABLE>
(i) Class C Shares were not offered during the periods shown. Class A Shares
were not offered prior to December 31, 1996.
(ii) Ratios have been annualized; total return has not been annualized.
(iii) Does not reflect the effect of any sales charges.
(iv) Reflects total expenses, including fees offset by earnings credits. The
expense ratios net of earnings credits would have been 2.26% and 2.34% for
the years ended October 31, 1996 and 1995, respectively.
(v) Amount was computed based on average shares outstanding during the period.
(vi) Expense ratios for the periods ended prior to October 31, 1995 do not
reflect the effect of fees offset by earnings credits, if any.
(vii) Unaudited.
===============================================================================
ix
<PAGE>
===============================================================================
THE ALGER FUND
GROWTH PORTFOLIO
FINANCIAL HIGHLIGHTS (I)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD (II)
<TABLE>
<CAPTION>
CLASS A CLASS B
------------ ---------------------------------------------------------------
FOUR MONTHS SIX MONTHS
ENDED ENDED
APRIL 30, APRIL 30, YEAR ENDED OCTOBER 31,
---------------------------------------
1997 (III, VIII) 1997 (III, VIII) 1996 1995 1994 1993
---------------- ---------------- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year.......... $ 9.38 $ 6.97 $ 7.43 $ 5.76
------- ------- ------- ------ ------ ------
Net investment income (loss)................ (.08)(v) (.02) (.07)(v) (.02)
Net realized and unrealized gain
(loss) on investments..................... .78 2.59 .35 1.70
------- ------- ------- ------ ------ ------
Total from investment operations............ .70 2.57 .28 1.68
Distributions from net realized gains....... (.59) (.16) (.74) (.01)
------- ------- ------- ------ ------ ------
Net asset value, end of year................ $ 9.49 $ 9.38 $ 6.97 $ 7.43
======= ======= ======== ====== ======= ======
Total Return (iv)........................... 8.1% 37.8% 4.1% 29.2%
======= ======= ======== ======= ======= ======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)......................... $266,207 $154,284 $ 76,390 $ 37,988
======= ======= ======== ======= ======= ======
Ratio of expenses to average
net assets.............................. 2.08%(vi) 2.09%(vi) 2.20%(vii) 2.20%(vii)
======= ======= ======== ======= ======= ======
Decrease reflected in above
expense ratios due to expense
reimbursements.......................... -- -- -- --
======= ======= ======== ======= ======= ======
Ratio of net investment
income (loss)
to average net assets................... (.84%) (1.03%) (1.01%) (1.16%)
======= ======= ======== ======= ======= ======
Portfolio Turnover Rate.................... 94.91% 118.16% 103.86% 108.54%
======= ======= ======== ======= ======= ======
Average Commission Rate Paid.............. $ .0715
========
</TABLE>
===============================================================================
x
<PAGE>
<TABLE>
<CAPTION>
===================================================================================================================================
Class B
-----------------------------------------------------------------------------------
From
November 11, 1986
(commencement
of operations)
Year Ended October 31, to October 31,
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1992 1991 1990 1989 1988 1987(viii)
----- ----- ----- ----- ----- --------------
Net asset value, beginning of year............ $ 5.77 $ 4.25 $ 4.42 $ 3.48 $ 3.23 $ 3.33
-------- ------- ------- ------- ------- -------
Net investment income (loss).................. (.06)(v) (.02) (.02) (.05) (.04) (.03)
Net realized and unrealized gain
(loss) on investments....................... .61 1.86 (.15) .99 .29 (.07)
-------- ------- ------- ------- ------- -------
Total from investment operations.............. .55 1.84 (.17) .94 .25 (.10)
Distributions from net realized gains......... (.56) (.32) -- -- -- --
-------- ------- ------- ------- ------- -------
Net asset value, end of year.................. $ 5.76 $ 5.77 $ 4.25 $ 4.42 $ 3.48 $ 3.23
======== ======= ======= ======= ======= =======
Total Return (iv)............................. 9.7% 45.8% (4.0%) 27.0%(iii) 7.7%(iii) (3.0%)(iii)
======== ======= ======= ======= ======= =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)........................... $ 19,379 $ 10,213 $ 5,667 $ 5,463 $ 5,294 $ 5,305
======== ======== ======= ======= ======= =======
Ratio of expenses to average
net assets................................ 2.32%(vii) 2.70%(vii) 3.09%(vii) 3.32%(vii) 3.01%(vii) 3.00%(vii)
======== ======== ======= ======= ======= =======
Decrease reflected in above
expense ratios due to expense
reimbursements............................ -- -- -- -- .43% .83%
======== ======== ======= ======= ======= =======
Ratio of net investment
income (loss)
to average net assets..................... (1.07%) (1.06%) (.68%) (.70%) (.99%) (1.08%)
======== ======== ======= ======= ======= =======
Portfolio Turnover Rate..................... 69.28% 76.06% 86.06% 106.73% 151.30% 135.50%
======== ======== ======= ======= ======= =======
(i) Class C Shares were not offered during the periods shown. Class A Shares
were not offered prior to December 31, 1996.
(ii) Per share data has been adjusted to reflect the effect of a 3 for 1
stock split which occurred September 27, 1995.
(iii) Unaudited.
(iv) Does not reflect the effect of any sales charges.
(v) Amount was computed based on average shares outstanding during the period.
(vi) Reflects total expenses, including fees offset by earnings credits. The
expense ratios net of earnings credits would have been 2.07% for each of
the years ended October 31, 1996 and 1995, respectively.
(vii) Expense ratios for the periods ended prior to October 31, 1995 do not
reflect the effect of fees offset by earnings credits, if any.
(viii)Ratios have been annualized; total return has not been annualized.
===================================================================================================================================
xi
</TABLE>
<PAGE>
<TABLE>
===============================================================================================================================
THE ALGER FUND
SMALL CAPITALIZATION PORTFOLIO
Financial Highlights (i)
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD (II)
<CAPTION>
Class A Class B
------------ -------------------------------------------------------------------
Four Months Six Months
Ended Ended
April 30, April 30, Year Ended October 31,
---------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1997 (iii, viii) 1997 (iii, viii) 1996 1995 1994 1993
------------ ------------ ----- ----- ----- -----
Net asset value, beginning of year......... $ 11.13 $ 7.62 $ 8.65 $ 6.88
------- ------- ------- ------- ------- -------
Net investment income (loss)................ (.09) (.13) (.09) (.08)
Net realized and unrealized
gain (loss) on investments............. .42 3.64 (.02) 1.85
------- ------- ------- ------- ------- -------
Total from investment operations............ .33 3.51 (.11) 1.77
Distributions from net realized gains....... (.60) -- (.92) --
------- ------- ------- ------- ------- -------
Net asset value, end of year................ $ 10.86 $ 11.13 $ 7.62 $ 8.65
======= ======= ======= ======= ======= =======
Total Return (iv)........................... 3.2 % 46.2 % (1.1 %) 25.8 %
======= ======= ======= ======= ======= =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)...................... $553,872 $463,718 $294,890 $300,108
======= ======= ======= ======= ======= =======
Ratio of expenses to
average net assets................... 2.13%(vi) 2.11%(vi) 2.18%(vii) 2.13%(vii)
======= ======= ======= ======= ======= =======
Decrease reflected in above expense
ratios due to expense
reimbursements....................... -- -- -- --
======= ======= ======= ======= ======= =======
Ratio of net investment
income (loss) to
average net assets...................... (1.59%) (1.75%) (1.51%) (1.52%)
======= ======= ======= ======= ======= =======
Portfolio Turnover Rate................... 153.35% 97.37% 131.86% 148.49%
======= ======= ======= ======= ======= =======
Average Commission Rate Paid.............. $ .0611
=========
=================================================================================================================================
</TABLE>
xii
<PAGE>
<TABLE>
===================================================================================================================================
<CAPTION>
Class B
----------------------------------------------------------------------------------------
From
November 11, 1986
(commencement
of operations)
Year Ended October 31, to October 31,
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1992 1991 1990 1989 1988 1987(viii)
----- ----- ----- ----- ----- --------------
Net asset value, beginning of year...... $ 6.97 $ 4.33 $ 5.91 $ 3.58 $ 3.00 $ 3.33
------- ------- ------- ------- ------- -------
Net investment income (loss)............. (.11)(v) (.03) (.06)(v) -- (.07) (.06)
Net realized and unrealized
gain (loss) on investments.......... .37 2.76 (.25) 2.33 .65 (.27)
------- ------- ------- ------- ------- -------
Total from investment operations......... .26 2.73 (.31) 2.33 .58 (.33)
Distributions from net realized gains.... (.35) (.09) (1.27) -- -- --
------- ------- ------- ------- ------- -------
Net asset value, end of year............. $ 6.88 $ 6.97 $ 4.33 $ 5.91 $ 3.58 $ 3.00
======= ======= ======= ======= ======= =======
Total Return (iv)........................ 3.4% 63.7% (7.1%) 65.1%(iii) 19.3%(iii) (10.0%)(iii)
======= ======= ======= ======= ======= =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted)...................$182,432 $61,273 23,628 $11,990 $ 3,709 $ 3,190
======== ======= ======= ======= ======= =======
Ratio of expenses to
average net assets................ 2.17%(vii) 2.23%(vii) 2.66%(vii) 3.25%(vii) 3.01%(vii) 3.00%(vii)
======= ======= ======= ======= ======= =======
Decrease reflected in above expense
ratios due to expense
reimbursements.................... -- -- -- -- 1.33% 1.62%
======= ======= ======= ======= ======= =======
Ratio of net investment
income (loss) to
average net assets................... (1.64%) (1.37%) (1.17%) (1.92%) (2.07%) (2.02%)
======= ======= ======= ======= ======= =======
Portfolio Turnover Rate................ 121.00% 171.04% 252.66% 441.42% 228.32% 267.55%
======= ======= ======= ======= ======= =======
Average Commission Rate Paid...........
(i) Class C Shares were not offered during the periods shown. Class A Shares
were not offered prior to December 31, 1996.
(ii) Per share data has been adjusted to reflect the effect of a 3 for 1
stock split which occurred September 27, 1995.
(iii) Unaudited.
(iv) Does not reflect the effect of any sales charges.
(v) Amount was computed based on average shares outstanding during the period.
(vi) Reflects total expenses, including fees offset by earnings credits. The
expense ratio net of earnings credits would have been the same for the
years ended October 31, 1996 and 1995, respectively.
(vii) Expense ratios for the periods ended prior to October 31, 1995 do not
reflect the effect of fees offset by earnings credits, if any. (viii)Ratios
have been annualized; total return has not been annualized.
====================================================================================================================================
</TABLE>
xiii
<PAGE>
<TABLE>
===================================================================================================================================
THE ALGER FUND
CAPITAL APPRECIATION PORTFOLIO (i)
Financial Highlights (ii)
FOR A SHARE OUTSTANDING THROUGHOUT THE YEAR
<CAPTION>
Class A Class B
----------- -------------------------------------------------------------
Four Six
Months Months
Ended Ended
April 30, April 30, Year Ended October 31,
------------------------------------------
<S> <C> <C> <C> <C> <C>
1997 (vii, viii) 1997 (vii, viii) 1996 1995 1994
---------------- ---------------- --------- --------- --------
Net asset value, beginning of year......... $ 18.62 $ 11.11 $ 10.00
--------- --------- --------- --------- --------
Net investment (loss)...................... (.34)(iii) (0.47)(iii) (0.47)
Net realized and unrealized gain
on investments........................... 3.88 7.98 1.58
--------- --------- --------- --------- --------
Total from investment operations......... 3.54 7.51 1.11
Distributions from net realized gains...... (.54) -- --
--------- --------- --------- --------- --------
Net asset value, end of year............... $ 21.62 $ 18.62 $ 11.11
========= ========= ========= ========= ========
Total Return (iv).......................... 19.5 % 67.6 % 11.1 %
========= ========= ========= ========= ========
Ratios and Supplemental Data:
Net assets, end of year (000's omitted).. $ 150,258 $ 33,640 $ 2,369
========= ========= ========= ========= ========
Ratio of expenses excluding interest to
average net assets..................... 2.44% 3.26% 4.13%
========= ========= ========= ========= ========
Ratio of expenses including interest to
average net assets..................... 2.46%(v) 3.54%(v) 5.53%(vi)
========= ========= ========= ========= ========
Decrease reflected in above expense
ratios due to expense reimbursements... -- -- 0.85%
========= ========= ========= ========= ========
Ratio of net investment income
(loss) to average net assets........... (1.61%) (3.02%) (5.12%)
========= ========= ========= ========= ========
Portfolio Turnover Rate.................. 162.37% 197.65% 231.99%
========= ========= ========= ========= ========
Average Commission Rate Paid............. $ .0647
=========
Debt outstanding at end of year.......... $7,700,000 -- $651,000
========= ========= ========= ========= ========
Average amount of debt
outstanding during the year............ $ 239,966 $ 293,153 $406,864
========= ========= ========= ========= ========
Average daily number of shares
outstanding during the year............ 4,852,286 543,270 191,676
========= ========= ========= ========= ========
Average amount of debt per
share during the year.................. $ 0.05 $ 0.54 $ 2.12
========= ========= ========= ========= ========
(i) Prior to March 27, 1995, the Capital Appreciation Portfolio was the
Leveraged AllCap Portfolio.
(ii) Class C Shares were not offered during the periods shown. Class A Shares
were not offered prior to December 31, 1996. (iii) Amount was computed based on
average shares outstanding during the year.
(iv) Does not reflect the effect of any sales charges.
(v) Reflects total expenses, including fees offset by earnings credits. The
expense ratios net of earnings credits would have been 2.45% and 3.43%
for the years ended October 31, 1996 and 1995, respectively.
(vi) Expense ratio does not reflect the effect of fees offset by earnings credits.
(vii) Unaudited.
(viii) Ratios have been annualized; total return has not been annualized.
====================================================================================================================================
xiv
</TABLE>
<PAGE>
HOW TO PURCHASE SHARES
IN GENERAL
The Alger Fund (the "Fund") offers Class A, Class B and Class C Shares
(except for Alger Money Market Portfolio which has a single class of shares) for
investors. The offering price for Class A Shares is net asset value plus an
initial sales charge that declines for larger purchases (see "Class A Share
Information" below). Purchases of Class A Shares in amounts of $1 million or
more incur no initial sales charge but may be subject to a contingent deferred
sales charge ("CDSC") if held for less than one year. The offering price for
Class B Shares is net asset value with no initial sales charge but such shares
may be subject to a CDSC if held for less than six years. Class B Shares
automatically convert to Class A Shares after they have been held for eight
years (see "Class B Share Information" below). Class C shares also are sold at
net asset value without an initial sales charge, but they may be subject to a
CDSC of 1% if held for less than one year. Class C Shares automatically convert
to Class A Shares after they have been held for twelve years (see "Class C Share
Information" below). Alger Money Market Portfolio is sold without an initial or
contingent deferred sales charge. The minimum initial investment for each
Portfolio is $500, and subsequent investments must be at least $25. These
minimums may be waived under certain circumstances. The Fund or the transfer
agent may reject any purchase order.
METHODS OF PURCHASING SHARES
MAIL
You can buy shares through Alger Shareholder Services, Inc., the Fund's
transfer agent ("Transfer Agent"), by filling out the New Account Application
and returning it with a check drawn on a U.S. bank to Alger Shareholder
Services, Inc. at 30 Montgomery Street, Box 2001, Jersey City, NJ 07302.
WIRE TRANSFERS
Investors establishing new accounts by wire transfer should forward their
completed New Account Applications to the Transfer Agent, stating that the
account was established by wire transfer and the date and amount of the
transfer. Further information regarding wire transfers is available by calling
(800) 992-3863.
BROKERS
You can buy shares of the Portfolios through brokers who have signed sales
agreements with the Fund's Distributor, Fred Alger & Company, Incorporated
("Alger Inc.").
PROCESSING ORGANIZATIONS
You can buy shares through a "Processing Organization", which is a
broker-dealer, bank or other financial institution that purchases shares for its
customers. Processing Organizations may impose charges and restrictions in
addition to or different from those applicable if you invest with the Fund
directly. Therefore, you should read the materials provided by the Processing
Organization in conjunction with this Prospectus. Certain Processing
Organizations may receive compensation from the Fund, Alger Inc., or any of its
affiliates.
CLASS A SHARE INFORMATION
Class A Shares are available in all Portfolios except Alger Money Market
Portfolio. These shares may be subject to an initial sales charge (indicated
below) on purchases of less than $1 million. Purchases of Class A Shares in the
amount of $1 million or more avoid the initial sales charge, but are subject to
a CDSC of 1% if held for less than one year. With the exception of differing
applicable holding periods and amounts, the same procedures and conditions will
apply to the CDSC for $1 million purchases of Class A Shares as apply to the
CDSC for Class B Shares. See "Contingent Deferred Sales Charge" below.
1
<PAGE>
INITIAL SALES CHARGE
The sales charges applicable to purchases of Class A Shares of the
Portfolios (other than the Alger Money Market Portfolio) are:
Sales Charge Sales Charge Dealer Allowance
Purchase as % of as % of as % of
Amount Offering Price Net Asset Value Offering Price
- ----------------------- ------------- ---------------- ----------------
Less than $100,000 4.75% 4.99% 4.00%
$100,000 - $249,999 4.00% 4.17% 3.25%
$250,000 - $499,999 3.00% 3.09% 2.50%
$500,000 - $999,999 2.25% 2.30% 1.75%
$1,000,000 and over * * 1.00%
- ------------------
* Purchases of Class A Shares, which when combined with current holdings of
Class A Shares offered with a sales charge equal or exceed $1,000,000 in the
aggregate, may be made at net asset value without any initial sales charge,
but will be subject to a CDSC of 1.00% on redemptions made within 12 months of
purchase. The CDSC is waived in the same circumstances in which the CDSC
applicable to Class B Shares is waived. See "Waivers of Sales Charges."
The reduced sales charges shown above apply to the aggregate of purchases of
Class A Shares of the Fund made at one time (unless a Letter of Intent is on
file with the Fund) by "any person," which includes an individual, his or her
spouse and children, or a trustee or other fiduciary of a single trust, estate
or single fiduciary account. See "Letter of Intent."
From time to time Alger Inc. may reallow to brokers or financial
intermediaries all or substantially all of the initial sales charge. To the
extent that it does so, such persons may be deemed to be underwriters of the
Fund as defined in the Securities Act of 1933, as amended.
RIGHT OF ACCUMULATION
Class A Shares of the Fund may be purchased by "any person" (as defined
above) at a reduced sales charge as determined by aggregating the dollar amount
of the new purchase and the current value (at offering price) of all Class A
Shares of the Fund then held by such person and applying the sales charge
applicable to such aggregate. In order to obtain such discount, the purchaser
must provide sufficient information at the time of purchase to permit
verification that the purchase qualifies for the reduced sales charge. The right
of accumulation is subject to modification or discontinuance at any time with
respect to all shares purchased thereafter.
LETTER OF INTENT
A Letter of Intent ("LOI") contemplating aggregate purchases of $100,000 or
more provides an opportunity for an investor to obtain a reduced sales charge by
aggregating investments over a 13-month period, provided that the investor
refers to such LOI when placing orders. For purposes of a LOI, the "Purchase
Amount" as referred to in the preceding sales charge table includes purchases of
all Class A Shares of the Fund offered with a sales charge over the following 13
months. An alternative is to compute the 13-month period starting up to 90 days
before the date of execution of the LOI.
The minimum initial investment under the LOI is 5% of the total LOI amount.
Each investment made during the period receives the reduced sales charge
applicable to the total amount of the investment goal. Shares purchased with the
first 5% of the total LOI amount will be held in escrow by the Transfer Agent to
assure any necessary payment of a higher applicable sales charge if the
investment goal is not met. If the goal is not achieved within the period, the
investor must pay the difference between the sales charges applicable to the
purchases made and the charges previously paid, or an appropriate number of
escrowed shares will be redeemed.
CLASS B SHARE INFORMATION
Class B Shares are sold at net asset value with no initial sales charge.
This provides investors the benefit of putting all of their dollars to work at
the time the investment is made. However, a CDSC of up to 5% may be imposed if
you redeem your shares within six years of purchase. See "Contingent Deferred
Sales Charge." Class B Shares are subject to certain Rule 12b-1 fees as well,
which are described below. Once Class B Shares have been held for eight years,
they will automatically convert to Class A Shares. See "Conversion of Class B
and Class C Shares."
2
<PAGE>
CLASS C SHARE INFORMATION
Class C Shares are sold at net asset value with no initial sales charge.
This provides investors the benefit of putting all of their dollars to work at
the time the investment is made. However, a CDSC of 1% may be imposed if you
redeem your shares within one year of purchase. Class C Shares are subject to
certain Rule 12b-1 fees as well, which are described below. Once Class C Shares
have been held for twelve years, they will automatically convert to Class A
Shares. (See "Conversion of Class B and Class C Shares.") With the exception of
differing applicable holding periods and amounts, the same procedures and
conditions will apply to the CDSC for Class C Shares as apply to the CDSC for
Class B Shares. See "Contingent Deferred Sales Charge."
Class C Shares are subject to the same ongoing distribution and service fees
as Class B Shares but are subject to a CDSC for a shorter period of time (one
year versus six years) than Class B Shares. However, Class B Shares convert to
Class A Shares after a shorter period of time than do Class C Shares (eight
years versus twelve years).
CONVERSION OF CLASS B AND CLASS C SHARES
Class B and Class C Shares will automatically convert to Class A Shares
eight and twelve years, respectively, after the end of the calendar month in
which the order to purchase was accepted and will thereafter not be subject to
the original Class's Rule 12b-1 fees. The conversion will be completed on the
basis of the relative net asset values per share without the imposition of any
sales charge, fee or other charge. At conversion, a proportionate amount of
shares representing reinvested dividends and reinvested capital gains will also
be converted into Class A Shares. In addition, because Alger Money Market
Portfolio is not subject to any distribution fees, the running of the applicable
conversion period is suspended for any period of time in which Class B or Class
C Shares are held in that Portfolio. For purposes of determining the conversion
date of Class B Shares outstanding prior to August 1, 1997, such shares will be
deemed to have been held for either eight years or the period (adjusted as set
forth in the preceding sentence) since their purchase, whichever is shorter.
Accordingly, all Class B Shares outstanding for at least eight years as of
August 31, 1997 will convert to Class A Shares on August 31, 1997.
The conversion of Class B Shares and Class C Shares is subject to the
continuing availability of an opinion of counsel to the effect that the
conversion of shares does not constitute a taxable event under Federal income
tax laws. The conversion of Class B and Class C Shares may be suspended if such
an opinion is no longer available.
DISTRIBUTION PLANS
The Fund has adopted separate Distribution Plans (the "Plans") pursuant to
Rule 12b-1 under the Investment Company Act of 1940, as amended (the "1940 Act")
under which Classes B and C of each Portfolio other than Alger Money Market
Portfolio may make payments to Alger Inc. in connection with its activities in
promoting sales of that Portfolio's Class B and C Shares--at a maximum annual
rate of .75% of the Portfolio's average daily net assets represented by such
shares (each a Rule 12b-1 fee). Under the Class B Plan, the Rule 12b-1 fee is
paid, up to the maximum annual rate, to the extent necessary to reimburse Alger
Inc.'s expenses incurred in promoting distribution of Class B shares. Under the
Class C Plan, the Rule 12b-1 fee constitutes compensation to Alger Inc. for its
activities in distributing Class C Shares, and the expenses incurred by Alger
Inc. in connection with such activities may be greater or less than the
compensation received from the Portfolio. In each case, the Rule 12b-1 fee,
sometimes described as an "asset-based sales charge," allows investors to buy
shares without an initial sales charge while allowing Alger Inc. to compensate
dealers that sell Class B or C Shares of the Portfolios. Typically, Alger Inc.,
in its discretion or pursuant to dealer agreements, pays sales commissions of up
to 4.75% of the amount invested in Class B Shares, and up to 1% of the amount
invested in Class C Shares, to dealers from its own resources at the time of
sale and pays continuing commissions after purchase to dealers selling Class C
Shares. For Class B Shares, Alger Inc. retains the asset-based sales charge to
recoup the sales commissions and other sales-related expenses its pays. For
Class C Shares, the asset-based sales charge is retained by Alger Inc. in the
3
<PAGE>
first year after purchase; in subsequent years, all or a portion of it typically
is paid to the dealers who sold the Class C Shares. In some cases, the selling
dealer is Alger Inc. Any CDSCs on Class B Shares received by Alger Inc. will
reduce the amount to be reimbursed under the Class B Plan. Under the Class B
Plan, any excess distribution expenses may be carried forward, with interest,
and reimbursed in future years. At October 31, 1996, the end of the Fund's
fiscal year, the following approximate amounts were carried forward under the
Plan: Alger Small Capitalization Portfolio--$16,225,000 (2.93% of net assets);
Alger MidCap Growth Portfolio--$3,069,000 (2.44%); Alger Growth
Portfolio--$7,877,000 (2.96%); Alger Balanced Portfolio--$282,000 (2.09%); and
Alger Capital Appreciation Portfolio--$2,130,000 (1.42%).
CONTINGENT DEFERRED SALES CHARGE
No CDSC is imposed on the redemption of shares of Alger Money Market
Portfolio, except for redemption of shares acquired in exchange for certain
Class A, Class B or Class C Shares of the other Portfolios.
With respect to Class B Shares, there is no initial sales charge on
purchases of shares of any Portfolio, but a CDSC may be charged on certain
redemptions. The CDSC is imposed on any redemption that causes the current value
of your account in the Class B shares of any Portfolio other than Alger Money
Market Portfolio to fall below the amount of purchase payments made during a
six-year holding period. The amount of the charge is based on the length of time
shares are held, according to the following table:
Contingent
Deferred Sales
Years Shares Were Held Charge
---------------------------------- ----------
Less than one..................................... 5%
One but less than two............................. 4%
Two but less than three........................... 3%
Three but less than four.......................... 2%
Four but less than five........................... 2%
Five but less than six............................ 1%
Six and greater................................... 0%
Certain Class A Shares also are subject to a CDSC. Those Class A Shares
purchased in an amount of $1 million or more which have not been subject to the
Class's initial sales charge and which have not been held for a full year are
subject to a CDSC of 1% at the time of redemption.
Class C Shares have no initial sales charge but are subject to a CDSC of 1%
if redeemed within one year of purchase.
IN GENERAL
For purposes of the CDSC, it is assumed that the shares of the Portfolio
from which the redemption is made are the shares of that Portfolio held the
longest and which result in the lowest or no charge.
Redemptions of shares of each of the Portfolios are deemed to be made first
from amounts, if any, to which a CDSC does not apply. There is no CDSC on
redemptions of (i) shares that represent appreciation on your original
investment, or (ii) shares purchased through reinvestment of dividends and
capital gains. Since no charge is imposed on shares purchased and retained in
Alger Money Market Portfolio, you may wish to consider redeeming those shares,
if any, before redeeming shares that are subject to a CDSC. Please see the
Statement of Additional Information for examples of how the CDSC is calculated
when shares are exchanged.
WAIVERS OF SALES CHARGES
No initial sales charge (Class A) or CDSC (Classes A, B or C) is imposed on
(1) purchases or redemptions by (i) employees of Alger Inc. and its affiliates,
(ii) IRAs, Keogh Plans and employee benefit plans for those employees and (iii)
spouses, children, siblings and parents of those employees and trusts of which
those individuals are beneficiaries, as long as orders for the shares on behalf
of those individuals and trusts were placed by the employees; (2) purchases or
redemptions by (i) accounts managed by investment advisory affiliates of Alger
Inc. that are registered under the 1940 Act, as amended, (ii) employees,
4
<PAGE>
participants and beneficiaries of those accounts, (iii) IRAs, Keogh Plans and
employee benefit plans for those employees, participants and beneficiaries and
(iv) spouses and minor children of those employees, participants and
beneficiaries as long as orders for the shares were placed by the employees,
participants and beneficiaries; (3) purchases or redemptions by directors or
trustees of any investment company for which Alger Inc. or any of its affiliates
serves as investment adviser or distributor; (4) purchases or redemptions of
shares held through defined contribution plans as defined by ERISA; (5)
purchases or redemptions by an investment company registered under the 1940 Act
in connection with the combination of the investment company with the Fund by
merger, acquisition of assets or by any other transaction; (6) purchases or
redemptions by registered investment advisers, banks, trust companies and other
financial institutions exercising discretionary authority with respect to the
money invested in Fund shares; (7) purchases or redemptions by registered
investment advisers for their own accounts; (8) purchases or redemptions by a
Processing Organization, as shareholder of record, on behalf of (i) investment
advisers or financial planners trading for their own accounts or the accounts of
their clients and who charge a management, consulting or other fee for their
services ("wrap" accounts); and clients of such investment advisers or financial
planners trading for their own accounts if the accounts are linked to the master
account of such investment adviser or financial planner on the books and records
of the Processing Organization, and (ii) retirement and deferred compensation
plans and trusts used to fund those plans; and (9) purchases or redemptions by
registered representatives of broker-dealers which have entered into Selected
Dealer Agreements with Alger Inc., and their spouses, children, siblings and
parents.
Any CDSC is also waived on (1) Systematic Withdrawal Plan payments, (2)
redemptions of shares in connection with certain required post-retirement
withdrawals from an IRA or other retirement plan or (3) redemptions following
the death or disability of a shareholder.
Investors purchasing Class A Shares subject to one of the foregoing waivers
are required to claim and substantiate their eligibility for the waiver at the
time of purchase. It is also the responsibility of shareholders redeeming shares
otherwise subject to a CDSC but qualifying for a waiver of the charge to assert
this status at the time of redemption. Information regarding these procedures is
available by contacting the Fund at (800) 992-3863.
HOW TO SELL SHARES
You can sell (redeem) some or all of your shares on any business day. Your
shares will be sold at the next net asset value calculated after your redemption
request is received and accepted by the Transfer Agent and your payment will be
made by check within seven days. A CDSC may be charged on certain redemptions.
See "Contingent Deferred Sales Charge" for details. Redemptions may be suspended
and payments delayed under certain emergency circumstances as determined by the
Securities and Exchange Commission. The Fund's Transfer Agent will reject any
redemption request made within 15 days after receipt of the purchase check or
the TelePurchase order against which such redemption is requested. You can sell
your shares in any of the following ways: by mail, by telephone, by check or
through your broker. Please note that, although the Fund is authorized to charge
a fee for each wire redemption, it does not currently intend to do so.
MAIL
You should send a letter of instruction to the Transfer Agent that includes
your name, account number, Portfolio name, the class of shares (if applicable),
the number of shares or dollar amount and where you want the money to be sent.
The letter must be signed by all authorized signers and, if the redemption is
for more than $5,000 or if the proceeds are to be sent to an address other than
the address of record, the signature(s) must be guaranteed. In addition, any
request for redemption proceeds to be sent to the address of record must have
the signature(s) guaranteed if made within 60 days of changing your address. The
Transfer Agent will accept a signature guarantee by the following financial
institutions: a U.S. bank, trust company, broker, dealer, municipal securities
broker or dealer, government securities broker or dealer, credit union which is
authorized to provide signature guarantees, national securities exchange,
registered securities association or clearing agency.
5
<PAGE>
TELEPHONE WIRE REDEMPTION OPTION
If you wish to use this service, you should mark the appropriate box on the
New Account Application or complete a Telephone Services Form with a guaranteed
signature. To sell shares by telephone, please call (800) 992-3863. If your
redemption request is received before 12:00 noon Eastern time for Alger Money
Market Portfolio, your redemption proceeds will be wired the same day.
Redemption requests for Portfolios other than Alger Money Market Portfolio
received prior to the close of business of the New York Stock Exchange (normally
4:00 p.m. Eastern time) and requests received after 12:00 noon for Alger Money
Market Portfolio will be paid on the next business day. The minimum wire
redemption amount is $2,500. If your proceeds are less than $2,500, they will be
mailed to your address of record. Redemption requests made before 12:00 noon
Eastern time for Alger Money Market Portfolio will not receive a dividend for
that day.
TELEPHONE CHECK REDEMPTION OPTION
If you wish to use this service, you should mark the appropriate box on the
New Account Application or complete a Telephone Services Form with a guaranteed
signature. To sell shares by telephone, please call (800) 992-3863. If your
redemption request is received before 12:00 noon Eastern time for Alger Money
Market Portfolio, your redemption proceeds will generally be mailed on the next
business day. Redemption requests for Portfolios other than Alger Money Market
Portfolio received prior to the close of business of the New York Stock Exchange
(the "NYSE") (normally 4:00 p.m. Eastern time) will generally be mailed on the
next business day. Requests received after 12:00 noon Eastern time for Alger
Money Market Portfolio will generally be mailed on the business day following
the next business day.
A telephone redemption which requests a check to be mailed to the address of
record is not available within 60 days of changing your address. Redemption
requests made before 12:00 noon Eastern time for Alger Money Market Portfolio
will not receive a dividend for that day.
The Fund, the Transfer Agent and their affiliates are not liable for acting
in good faith on telephone instructions relating to your account, so long as
they follow reasonable procedures to determine that the telephone instructions
are genuine. Such procedures may include recording the telephone calls and
requiring some form of personal identification. You should verify the accuracy
of telephone transactions immediately upon receipt of your confirmation
statement.
CHECK (ALGER MONEY MARKET PORTFOLIO ONLY)
You may redeem shares in your Alger Money Market Portfolio account by
writing a check for at least $500. Dividends are earned until the check clears.
If you mark the appropriate box on the New Account Application and sign the
signature card, the Fund will send you redemption checks. There is no charge for
the first five checks you write in any one calendar year. You will be charged
$2.50 for each additional check you write.
Your redemption may be reduced by any applicable CDSC (see "Contingent
Deferred Sales Charge"). If your account is not adequate to cover the amount of
your check and any applicable CDSC, the check will be returned marked
insufficient funds. As a result, checks should not be used to close an account.
The use of the check redemption procedure does not give rise to a banking
relationship between the shareholder and the Transfer Agent, which will be
acting solely as transfer agent for the Portfolio.
REDEMPTION IN KIND
Under unusual circumstances, shares of a Portfolio may be redeemed "in
kind," which means that the redemption proceeds will be paid with securities
which are held by the Portfolio. Please refer to the Statement of Additional
Information for more details.
6
<PAGE>
SPECIAL INVESTOR SERVICES
EXCHANGE PRIVILEGE
Except as limited below, shareholders may exchange some or all of their
Portfolio shares for shares of another Portfolio of the Fund. Class A
shareholders may exchange their shares for Class A Shares of another Portfolio
or for shares of Alger Money Market Portfolio. Class B shareholders may exchange
their shares for Class B Shares of another Portfolio or for shares of Alger
Money Market Portfolio. Class C shareholders may exchange their shares for Class
C Shares of another Portfolio or for shares of Alger Money Market Portfolio.
Alger Money Market Portfolio shares acquired by direct purchase may be exchanged
for Class A , Class B or Class C Shares of another Portfolio; however, any
applicable sales charge will apply to the shares acquired, depending upon their
class. Shares of Alger Money Market Portfolio acquired by exchange rather than
by direct purchase may be exchanged for shares of another Portfolio, but only
for shares of the same class as those originally exchanged for Alger Money
Market Portfolio shares. The period of time shares are held in Alger Money
Market Portfolio shall not be considered in the calculation of a CDSC or in
scheduling of the automatic conversion to Class A Shares.
If you want to authorize exchanges by telephone, you should mark the
appropriate box on the New Account Application. For tax purposes, an exchange of
shares is treated as a sale of the shares exchanged and, therefore, you may
realize a taxable gain or loss when you exchange shares. Shares exchanged prior
to the close of business of the New York Stock Exchange (normally 4:00 p.m.
Eastern time) from Alger Money Market Portfolio to any other Portfolio will
receive dividends from Alger Money Market Portfolio for the day of the exchange.
Shares of Alger Money Market Portfolio received in exchange for shares of any
other Portfolio will earn dividends beginning on the next business day after the
exchange.
You may make up to six exchanges annually by telephone or in writing. The
Fund may charge a transaction fee for each exchange, although it does not intend
to do so at present. You will be notified at least 60 days in advance if the
Fund decides to impose this fee. The Fund reserves the right to terminate or
modify the exchange privilege upon notice to shareholders.
AUTOMATIC INVESTMENT PLAN
The Fund offers an Automatic Investment Plan which permits you to make
regular transfers to your Fund account from your bank account on the last
business day of every month. The minimum monthly investment amount is $25 per
Portfolio. Your bank must be a member of the Automated Clearing House.
AUTOMATIC EXCHANGE PLAN
The Fund also offers an Automatic Exchange Plan which permits you to
exchange a specified amount from your Alger Money Market Portfolio account into
one or all of the other Portfolios on or about the fifteenth day of the month.
The minimum monthly exchange amount is $25 per Portfolio.
For more information on any of the services discussed above, please call the
Fund toll-free at (800) 992-3863.
TELEPURCHASE AND TELEREDEMPTION PRIVILEGES
The TELEPURCHASE Privilege allows you to purchase Fund shares by telephone
(minimum $500, maximum $50,000) by filling out the appropriate section of the
New Account Application or sending a Telephone Services Form to the Transfer
Agent. Your funds will be transferred from your designated bank account to your
Fund account normally within one business day.
The TELEREDEMPTION Privilege allows you to transfer funds (minimum $500,
maximum $50,000) between your Fund account and your designated bank account.
Redemption proceeds will be transferred to your bank account, generally within
two business days after your redemption request is received. Although the Fund
is authorized to charge a fee of $17.00 for each Automated Clearing House
redemption, it does not currently intend to do so.
To use these privileges, your bank must be a member of the Automated
Clearing House. Shares held in any Alger retirement plan and shares issued in
certificate form are not eligible for this service.
7
<PAGE>
RETIREMENT PLANS
Shares of the Portfolios are available as an investment for your retirement
plans, including IRAs, Keogh Plans, corporate pension and profit-sharing plans,
Simplified Employee Pension IRAs, SIMPLE IRAs, 401(k) Plans and 403(b) Plans.
Please call the Fund at (800) 992-3863 to receive the appropriate documents
which contain important information and applications.
SYSTEMATIC WITHDRAWAL PLAN
If your account is $10,000 or more in any Portfolio, you may establish a
Systematic Withdrawal Plan to receive payments of at least $50 on a monthly,
quarterly or annual basis, without payment of a CDSC. The maximum monthly
withdrawal is one percent of the current account value in the Portfolio at the
time you begin participation in the Plan.
REINSTATEMENT PRIVILEGE
A shareholder who has redeemed shares of a Portfolio may, within 30 days of
the redemption, reinstate any portion or all of the net proceeds of such
redemption in Portfolio shares of the same class by exercise of the
Reinstatement Privilege. Reinvestment will be at the net asset value of the
Portfolio next determined upon receipt of the proceeds and letter requesting
this privilege be exercised, subject to confirmation of the shareholder's status
or holdings, as the case may be. You will also receive a pro rata credit for any
CDSC imposed. This privilege may be exercised only once by a shareholder.
Exercising the Reinstatement Privilege will not alter any tax payable on the
redemption and a loss may not be allowed for tax purposes.
INVESTMENT OBJECTIVES
AND POLICIES
The investment objectives of the Portfolios and the investment restrictions
summarized in the next paragraph are fundamental which means that they may not
be changed without shareholder approval. All investment policies and practices
described elsewhere in this Prospectus are not fundamental, which means the
Fund's Board of Trustees may change them without shareholder approval. There is
no guarantee that any Portfolio's objectives will be achieved.
As a matter of fundamental policy, no Portfolio will: (1) with respect to
75% of its total assets, invest more than 5% of its total assets in any one
issuer, except for obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities ("U.S. Government securities"); (2) own more than
10% of the outstanding voting securities of any company; (3) invest more than
10% (15% for Alger Capital Appreciation Portfolio) of its net assets in
securities that are illiquid by virtue of legal or contractual restrictions on
resale or the absence of a readily available market; (4) invest more than 25% of
its total assets in any one industry, except for U.S. Government securities and,
with respect to Alger Money Market Portfolio, bank and thrift obligations; (5)
borrow money or pledge its assets, except that it may borrow money or pledge its
assets in an amount of up to 10% of its total assets for temporary or emergency
purposes and that Alger Capital Appreciation Portfolio may borrow for investment
purposes as described below under "Alger Capital Appreciation Portfolio." The
Statement of Additional Information contains additional investment restrictions
as well as additional information on the Portfolios' investment practices.
Except in the case of percentage limitations on borrowing by the Portfolios
and as may be otherwise stated, the percentage limitations contained in the
Fund's investment restrictions and other investment policies apply at the time
of purchase of a security, and a later increase or decrease in percentage
resulting from a change in value of securities or in the amount of the
Portfolio's assets will not constitute a violation of the restriction or policy.
In order to permit sales of shares in certain jurisdictions, the Fund may
commit to policies more restrictive than those stated above, and the Fund may
terminate any such commitment by discontinuing sales of shares in the applicable
jurisdiction.
8
<PAGE>
ALGER MONEY MARKET PORTFOLIO
The investment objective of the Portfolio is to earn high current income
consistent with preservation of principal and maintenance of liquidity. The
Portfolio may invest in "money market" instruments including, certificates of
deposit, time deposits and bankers' acceptances; U.S. Government securities;
corporate bonds having less than 397 days remaining to maturity; and commercial
paper, including variable rate master demand notes. The Portfolio may also enter
into repurchase agreements, reverse repurchase agreements and firm commitment
agreements. The Statement of Additional Information contains more information on
these instruments.
The Portfolio will invest at least 95% of its total assets in money market
securities which are rated within the highest credit category assigned by at
least two established rating agencies (or one rating agency if the security is
rated by only one) and will only invest in money market securities rated at the
time of purchase within the two highest credit categories or, if not rated, of
equivalent investment quality as determined by Fred Alger Management, Inc.
("Alger Management"), the Fund's investment manager. Alger Management subjects
all securities eligible for investment to its own credit analysis and considers
all securities purchased by the Portfolio to present minimal credit risks.
The Portfolio has a policy of maintaining a stable net asset value of $1.00.
This policy has been maintained since its inception; however, the $1.00 price is
not guaranteed or insured, nor is its yield fixed. The Portfolio generally
purchases securities which mature in 13 months or less. The average maturity of
the Portfolio will not be greater than 90 days. A discussion of rating agencies
is included in the Appendix to the Statement of Additional Information.
ALGER BALANCED PORTFOLIO
The investment objective of the Portfolio is current income and long-term
capital appreciation. The Portfolio intends to invest based on combined
considerations of risk, income, capital appreciation and protection of capital
value. Normally, it will invest in common stocks and investment grade fixed
income securities (preferred stock and debt securities), as well as securities
convertible into common stocks. Except during temporary defensive periods, the
Portfolio will maintain at least 25% of its net assets in fixed income (senior)
securities. With respect to debt securities, the Portfolio will invest only in
instruments which are rated in one of the four highest rating categories by any
established rating agency, or if not rated, which are determined by Alger
Management to be of comparable quality to instruments so rated.
The Portfolio may invest up to 35% of its total assets in money market
instruments and repurchase agreements and in excess of that amount (up to 100%
of its assets) during temporary defensive periods.
ALGER GROWTH PORTFOLIO
The investment objective of the Portfolio is long-term capital appreciation.
Except during temporary defensive periods, the Portfolio invests at least 65% of
its total assets in equity securities of companies that, at the time of purchase
of the securities, have total market capitalization--present market value per
share multiplied by the total number of shares outstanding--of $1 billion or
greater. The Portfolio may invest up to 35% of its total assets in equity
securities of companies that, at the time of purchase, have total market
capitalization of less than $1 billion.
ALGER MIDCAP GROWTH PORTFOLIO
The investment objective of the Portfolio is long-term capital appreciation.
Except during temporary defensive periods, the Portfolio invests at least 65% of
its total assets in equity securities of companies that, at the time of purchase
of the securities, have total market capitalization within the range of
companies included in the S&P MidCap 400 Index, updated quarterly. The S&P
MidCap 400 Index is designed to track the performance of medium capitalization
9
<PAGE>
companies. As of June 30, 1997, the range of market capitalization of these
companies was $____ million to $______ billion. The Portfolio may invest up to
35% of its total assets in equity securities of companies that, at the time of
purchase, have total market capitalization outside the range of companies
included in the S&P MidCap 400 Index and in excess of that amount (up to 100% of
its assets) during temporary defensive periods.
ALGER SMALL CAPITALIZATION PORTFOLIO
The investment objective of the Portfolio is long-term capital appreciation.
Except during temporary defensive periods, the Portfolio invests at least 65% of
its total assets in equity securities of companies that, at the time of purchase
of the securities, have total market capitalization within the range of
companies included in the Russell 2000 Growth Index ("Russell Index") or the S&P
SmallCap 600 Index ("S&P Index"), updated quarterly. Both indexes are broad
indexes of small capitalization stocks. As of June 30, 1997, the range of market
capitalization of the companies in the Russell Index was $__ million to $____
billion; the range of market capitalization of the companies in the S&P Index at
that date was $___ million to $____ billion. The combined range as of that date
was $____ million to $____ billion. The Portfolio may invest up to 35% of its
total assets in equity securities of companies that, at the time of purchase,
have total market capitalization outside this combined range, and in excess of
that amount (up to 100% of its assets) during temporary defensive periods.
ALGER CAPITAL APPRECIATION PORTFOLIO
The investment objective of the Portfolio is long-term capital appreciation.
Except during temporary defensive periods, the Portfolio invests at least 85% of
its net assets in equity securities of companies of any size.
The Portfolio may purchase put and call options and sell (write) covered
call and put options on securities and securities indexes to increase gain and
to hedge against the risk of unfavorable price movements, and may enter into
futures contracts on securities indexes and purchase and sell call and put
options on these futures contracts. The Portfolio may also borrow money
(leverage) for the purchase of additional securities. The Portfolio may borrow
only from banks and may not borrow in excess of one-third of the market value of
its total assets, less liabilities other than such borrowing. These practices
are deemed to be speculative and may cause the Portfolio's net asset value to be
more volatile than the net asset value of a fund that does not engage in these
activities. See "Investment Practices."
IN GENERAL
Alger Small Capitalization Portfolio, Alger MidCap Growth Portfolio, Alger
Growth Portfolio, Alger Capital Appreciation Portfolio, and the equity portion
of Alger Balanced Portfolio seek to achieve their objectives by investing in
equity securities, such as common or preferred stocks, or securities convertible
into or exchangeable for equity securities, including warrants and rights. The
Portfolios will invest primarily in companies whose securities are traded on
domestic stock exchanges or in the over-the-counter market. These companies may
still be in the developmental stage, may be older companies that appear to be
entering a new stage of growth progress owing to factors such as management
changes or development of new technology, products or markets or may be
companies providing products or services with a high unit volume growth rate. In
order to afford the Portfolios the flexibility to take advantage of new
opportunities for investments in accordance with their investment objectives and
to meet redemptions, they may hold up to 15% of their net assets in money market
instruments and repurchase agreements and in excess of that amount (up to 100%
of their assets) during temporary defensive periods.This amount, may be higher
than that maintained by other funds with similar investment objectives.
Investing in smaller, newer issuers generally involves greater risk than
investing in larger, more established issuers. Companies in which Alger Small
Capitalization Portfolio is likely to invest may have limited product lines,
markets or financial resources and may lack management depth. The securities in
10
<PAGE>
such companies may have limited marketability and may be subject to more abrupt
or erratic market movements than securities of larger, more established
companies or the market averages in general. Accordingly, an investment in the
Portfolio may not be appropriate for all investors. These risks may also apply
to investments in smaller companies by all other Portfolios except Alger Money
Market Portfolio.
INVESTMENT PRACTICES
The Portfolios may use the investment strategies and invest in the types of
securities described below, which may involve certain risks. The Statement of
Additional Information contains more detailed information about these practices
and information about other investment practices of the Portfolios.
REPURCHASE AGREEMENTS
In a repurchase agreement, a Portfolio buys a security at one price and
simultaneously agrees to sell it back at a higher price. In the event of a
bankruptcy or default of the other party to the repurchase agreement, the
Portfolio could experience costs and delays in liquidating the underlying
security, which is held as collateral, and the Portfolio might incur a loss if
the value of the collateral held declines during this period.
ILLIQUID AND RESTRICTED SECURITIES
An investment may be illiquid because of the absence of an active trading
market, making it difficult to sell promptly at an acceptable price. A
restricted security is one that has a contractual restriction on its resale or
which cannot be sold publicly until it is registered under the Securities Act of
1933. Each Portfolio may purchase securities eligible for resale under Rule 144A
of the Securities Act of 1933. This rule permits otherwise restricted securities
to be sold to certain institutional buyers. Under the policies and procedures
established by the Fund's Board of Trustees, Alger Management determines the
liquidity of the Portfolios' Rule 144A investments.
LENDING OF PORTFOLIO SECURITIES
In order to generate income and to offset expenses, each Portfolio may lend
portfolio securities with a value up to 331/3% of the Portfolio's total assets
to brokers, dealers and other financial organizations. Any such loan will be
continuously secured by collateral at least equal to the value of the securities
loaned. Default by the borrower could result in delays, costs and/or losses in
disposing of the collateral or recovering the loaned securities and, should the
borrower fail financially, possible loss of rights in the collateral.
FOREIGN SECURITIES
Each Portfolio other than Alger Money Market Portfolio may invest up to 20%
of its total assets in foreign securities. Investing in securities of foreign
companies and foreign governments, which generally are denominated in foreign
currencies, may involve certain risk and opportunity considerations not
typically associated with investing in domestic companies and could cause the
Portfolio to be affected favorably or unfavorably by changes in currency
exchange rates and revaluations of currencies.
Each Portfolio may purchase American Depositary Receipts ("ADRs"), American
Depositary Shares ("ADSs"), or U.S. dollar-denominated securities of foreign
issuers, none of which are included in the 20% foreign securities limitation.
ADRs and ADSs are traded in the U.S. securities markets and represent the
securities of foreign issuers. While ADRs and ADSs may not necessarily be
denominated in the same currency as the foreign securities they represent, many
of the risks associated with foreign securities may also apply to ADRs and ADSs.
LEVERAGE THROUGH BORROWING
Alger Capital Appreciation Portfolio may borrow money from banks and use it
to purchase additional securities. This borrowing is known as leveraging.
Leverage increases both investment opportunity and investment risk. If the
11
<PAGE>
investment gains on securities purchased with borrowed money exceed the interest
paid on the borrowing, the net asset value of the Portfolio's shares will rise
faster than would otherwise be the case. On the other hand, if the investment
gains fail to cover the cost (including interest) of borrowings, or if there are
losses, the net asset value of the Portfolio's shares will decrease faster than
would otherwise be the case. The Portfolio is required to maintain continuous
asset coverage (that is, total assets including borrowings, less liabilities
exclusive of borrowings) of 300% of the amount borrowed. If such asset coverage
should decline below 300% as a result of market fluctuations or other reasons,
the Portfolio may be required to sell some of its portfolio holdings within
three days to reduce the debt and restore the 300% asset coverage, even though
it may be disadvantageous from an investment standpoint to sell securities at
that time.
OPTIONS
Alger Capital Appreciation Portfolio may buy and sell (write) exchange
listed options in order to obtain additional return or to hedge the value of its
portfolio. Hedging transactions are intended to reduce the risk of price
fluctuations. The Portfolio may write an option on a security only if the option
is "covered" (for a discussion of covered options, see the Statement of
Additional Information). Although the Portfolio will generally purchase or write
only those options for which there appears to be an active secondary market,
there is no assurance that a liquid secondary market on an exchange will exist
for any particular option. The Portfolio will not purchase options if, as a
result, the aggregate cost of all outstanding options exceeds 10% of the
Portfolio's total assets, although no more than 5% will be committed to
transactions entered into for non-hedging purposes. The Portfolio may purchase
and sell put and call options on stock indexes in order to increase its gross
income or to hedge its portfolio against price fluctuations.
The writing and purchase of options are highly specialized activities which
involve investment techniques and risks different from those associated with
ordinary portfolio securities transactions. Additional discussion of these risks
and techniques is included in the Statement of Additional Information.
STOCK INDEX FUTURES AND OPTIONS ON
STOCK INDEX FUTURES
Alger Capital Appreciation Portfolio may purchase and sell stock index
futures contracts and options on stock index futures contracts. These
investments may be made only for hedging, not speculative, purposes.
There can be no assurance of the Portfolio's successful use of stock index
futures as a hedging device. If Alger Management uses a hedging instrument at
the wrong time or judges market conditions incorrectly, hedging strategies may
reduce the Portfolio's return. The Portfolio could also experience losses if the
prices of its futures and options positions were not correlated with its other
investments or if it could not close out a position because of an illiquid
market for the future or option.
PORTFOLIO TURNOVER
Portfolio changes will generally be made without regard to the length of
time a security has been held or whether a sale would result in a profit or
loss. Higher levels of portfolio activity generally result in higher transaction
costs and may also result in taxes on realized capital gains to be borne by the
Portfolio's shareholders.
MANAGEMENT OF THE FUND
ORGANIZATION
The Fund was organized on March 20, 1986 as a multi-series Massachusetts
business trust. The Fund offers an unlimited number of shares of six series,
representing the shares of the Portfolios. With the exception of Alger Money
Market Portfolio, each Portfolio offers three classes of shares.
12
<PAGE>
Although the Fund is not required by law to hold annual shareholder
meetings, it may hold meetings from time to time on important matters, and
shareholders have the right to call a meeting to remove a Trustee or to take
other action described in the Fund's Declaration of Trust. Shareholders of one
Portfolio may vote only on matters that affect that Portfolio. Shareholders of a
class have exclusive voting rights with respect to matters affecting only that
class, and shareholders vote separately by class on matters in which the
interests of one class differ from those of another.
BOARD OF TRUSTEES
The Fund is governed by a Board of Trustees which is responsible for
protecting the interests of shareholders under Massachusetts law. The Statement
of Additional Information contains general background information about each
Trustee and officer of the Fund.
INVESTMENT MANAGER
Alger Management is the Fund's investment manager and is responsible for the
overall administration of the Fund, subject to the supervision of the Board of
Trustees. Alger Management makes investment decisions for the Portfolios, places
orders to purchase and sell securities on behalf of the Portfolios and selects
broker-dealers that, in its judgment, provide prompt and reliable execution at
favorable prices and reasonable commission rates. It is anticipated that Alger
Inc. will serve as the Fund's broker in effecting substantially all of the
Portfolios' transactions on securities exchanges and will retain commissions in
accordance with certain regulations of the Securities and Exchange Commission.
The Fund will consider sales of its shares as a factor in the selection of
broker-dealers to execute over-the-counter portfolio transactions, subject to
the requirements of best price and execution. In addition, Alger Management
employs professional securities analysts who provide research services
exclusively to the Portfolios and other accounts for which Alger Management or
its affiliates serve as investment adviser or subadviser.
Alger Management has been in the business of providing investment advisory
services since 1964 and, as of June 30, 1997, had approximately $____ billion
under management, $____ billion in mutual fund accounts and $__ billion in other
advisory accounts. Alger Management is owned by Alger Inc. which in turn is
owned by Alger Associates, Inc., a financial services holding company. Fred M.
Alger, III and his brother, David D. Alger, are the majority shareholders of
Alger Associates, Inc. and may be deemed to control that company and its
subsidiaries.
PORTFOLIO MANAGERS
David D. Alger, Seilai Khoo and Ronald Tartaro are primarily responsible
for the day-to-day management of the Portfolios of the Fund. Mr. Alger has been
employed by Alger Management since 1971, as Executive Vice President and
Director of Research until 1995 and as President since 1995. Ms. Khoo has been
employed by Alger Management since 1989, as a senior research analyst until 1995
and as a Senior Vice President since 1995. Mr. Tartaro has been employed by
Alger Management since 1990, as a senior research analyst until 1995 and as a
Senior Vice President since 1995. Mr. Alger, Ms. Khoo and Mr. Tartaro also serve
as portfolio managers for other mutual funds and investment accounts managed by
Alger Management. Steven R. Thumm serves as co-manager of the Alger Balanced
Portfolio. He has been employed by Alger Management as a fixed income analyst
since 1991.
Alger Management personnel ("Access Persons") are permitted to engage in
personal securities transactions subject to the restrictions and procedures of
the Fund's Code of Ethics. Pursuant to the Code of Ethics, Access Persons
generally must preclear all personal securities transactions prior to trading
and are subject to certain prohibitions on personal trading. You can get a copy
of the Fund's Code of Ethics by calling the Fund toll-free at (800) 992-3863.
13
<PAGE>
FEES AND EXPENSES
Each Portfolio pays Alger Management a management fee computed daily and
paid monthly at annual rates based on a percentage of the value of the relevant
Portfolio's average daily net assets, as follows: Alger Money Market
Portfolio-.50%; Alger Small Capitalization Portfolio and Alger Capital
Appreciation Portfolio-.85%; Alger MidCap Growth Portfolio-.80%; Alger Growth
Portfolio and Alger Balanced Portfolio-.75%.
Each Portfolio pays other expenses related to its daily operations, such as
custodian fees, Trustees' fees, transfer agency fees, legal and auditing costs.
More information about each Portfolio's investment management agreement and
other expenses paid by the Portfolios is included in the Statement of Additional
Information.
The Statement of Additional Information contains information about the
Fund's brokerage policies and practices.
DISTRIBUTOR
Alger Inc. serves as the Fund's distributor and also distributes the shares
of other mutual funds managed by Alger Management.
TRANSFER AGENT
Alger Shareholder Services, Inc., an affiliate of Alger Management, serves
as transfer agent for the Fund. Certain record-keeping services that would
otherwise be performed by Alger Shareholder Services, Inc. may be performed by
other entities providing similar services to their customers who invest in the
Portfolios. The Fund, Alger Shareholder Services, Inc., Alger Inc. or any of its
affiliates may elect to enter into a contract to pay them for such services.
SHAREHOLDER SERVICING AGREEMENT
The Fund pays Alger Inc. a shareholder servicing fee of .25% of the average
daily net assets of each Portfolio other than Alger Money Market Portfolio for
ongoing service and maintenance of shareholder accounts. Alger Inc. will
compensate dealers from this fee who provide personal service and maintenance of
customer accounts.
NET ASSET VALUE
The price of one share of a class is based on its "net asset value." The net
asset value is computed by adding the value of the Portfolio's investments plus
cash and other assets allocable to the class, deducting applicable liabilities
and then dividing the result by the number of its shares outstanding. Net asset
value is calculated as of the close of business (normally 4:00 p.m. Eastern
time) or, for Alger Money Market Portfolio, as of 12:00 noon Eastern time on
each day the NYSE is open.
Purchases for Alger Money Market Portfolio will be processed at the net
asset value calculated after your order is received and accepted. If your
purchase is made by wire and is received by 12:00 noon Eastern time, your
account will be credited and begin earning dividends on the day of receipt. If
your wire purchase is received after 12:00 noon Eastern time, it will be
credited and begin earning dividends the next business day. Exchanges are
credited the day the request is received by mail or telephone, and begin earning
dividends the next business day. If your purchase is made by check, and received
by the close of business of the NYSE (normally 4:00 p.m. Eastern time), it will
be credited and begin earning dividends the next business day.
Purchases for the other Portfolios will be based upon the next net asset
value calculated for each class after your order is received and accepted. If
your purchase is made by check, wire or exchange and is received by the close of
business of the NYSE (normally 4:00 p.m. Eastern time), your account will be
credited on the day of receipt. If your purchase is received after such time, it
will be credited the next business day.
Third-party checks will not be honored except in the case of
employer-sponsored retirement plans. You will be charged a fee for any check
returned by your bank.
14
<PAGE>
DIVIDENDS AND TAXES
DIVIDENDS
Each class will be treated separately in determining the amounts of
dividends of investment income and distributions of capital gains payable to
holders of its shares. Dividends and distributions will be automatically
reinvested at net asset value on the payment date in additional shares of the
class that paid the dividend or distribution at net asset value, unless you
elected in writing to have all dividends and distributions paid in cash or
reinvested at net asset value into another identically registered Alger
Portfolio account you have established. In addition, accounts whose dividend
checks have been returned as undeliverable shall reinvest that dividend and all
future dividends until written request and a valid mailing address are provided
by the accountholder. Shares purchased through reinvestment of dividends and
distributions are not subject to a CDSC or front-end sales charge. Any dividends
of Alger Money Market Portfolio are declared daily and paid monthly, and any
dividends of the other Portfolios are declared and paid annually. Distributions
of any net realized short-term and long-term capital gains earned by a Portfolio
usually will be made annually after the close of the fiscal year in which the
gains are earned.
The classes of a Portfolio may have different dividend and distribution
rates. Class A dividends generally will be greater than those of Classes B and C
due to the Rule 12b-1 fees associated with Class B and C Shares. However,
dividends paid to each class of shares in a Portfolio will be declared and paid
at the same time and will be determined in the same manner as those paid to each
other class.
TAXES
Each Portfolio intends to qualify and elect to be treated each year as a
"regulated investment company" for federal income tax purposes. A regulated
investment company is not subject to regular income tax on any income or capital
gains distributed to its shareholders if it, among other things, distributes at
least 90 percent of its investment company taxable income to them within
applicable time periods. Each Portfolio is treated as a separate taxable entity,
with the result that taxable dividends and distributions from a Portfolio
reflect only the income and gains, net of losses, of that Portfolio.
For federal income tax purposes dividends and distributions from a Portfolio
are taxable to you whether paid in cash or reinvested in additional shares. You
may also be liable for tax on any gain realized upon the redemption or exchange
of shares in the Portfolios.
Shortly after the close of each calendar year, you will receive a statement
setting forth the dollar amounts of dividends and any distributions for the
prior calendar year and the tax status of the dividends and distributions for
federal income tax purposes. You should consult your tax adviser to assess the
federal, state and local tax consequences of investing in each Portfolio. This
discussion is not intended to address the tax consequences of an investment by a
nonresident alien.
PERFORMANCE
The Portfolios and their underlying classes advertise different types of
yield and total return performance. All performance figures are based on
historical earnings and are not intended to indicate future performance. Yield
and total return figures may be different among the classes of a portfolio.
Further information about the Fund's performance is contained in its Annual
Report to Shareholders, which may be obtained without charge by contacting the
Fund.
Alger Money Market Portfolio may advertise its "yield" and "effective
yield." The "yield" of the Portfolio refers to the income generated by an
investment in the Portfolio over a particular base period. This income is then
"annualized." That is, the amount of income generated by the investment during
the period is assumed to be generated over a 52 week period and is shown as a
percentage of the investment. The "effective yield" is calculated similarly but,
when annualized, the income earned by an investment in the Portfolio is assumed
to be reinvested. The "effective yield" will be slightly higher than the "yield"
because of the compounding effect on this assumed reinvestment.
15
<PAGE>
Each of the classes of the Portfolios other than Alger Money Market
Portfolio may also include quotations of their "total return" in advertisements
or reports to shareholders or prospective investors. Total return figures show
the aggregate or average percentage change in value of an investment in a class
from the beginning date of the measuring period to the end of the measuring
period. These figures reflect changes in the price of the class's shares and
assume that any income dividends and/or capital gains distributions made by the
class during the period were reinvested in shares of the class. Figures will be
given for recent 1, 5, and 10 year periods, and may be given for other periods
as well (such as from commencement of the class's operations, or on a
year-by-year basis) and may utilize dollar cost averaging. The class may use
"aggregate" total return figures for various periods, representing the
cumulative change in value of an investment in the class for the specific period
(again reflecting changes in class share price and assuming reinvestment of
dividends and distributions) as well as "actual annual" and "annualized" total
return figures. Total returns may be calculated either with or without the
effect of the CDSC or initial sales charge to which the shares are subject and
may be shown by means of schedules, charts or graphs, and may indicate subtotals
of the various components of total return (i.e., change in value of initial
investment, income dividends and capital gains distributions). "Total return"
and "yield" for a class will vary based on changes in market conditions. In
addition, since the deduction of a class's expenses is reflected in the total
return and yield figures, "total return" and "yield" will also vary based on the
level of the class's expenses.
The Statement of Additional Information, which is incorporated by reference,
further describes the method used to determine the yields and total return
figures. Current yield and/or total return quotations may be obtained by
contacting the Fund.
16
<PAGE>
[This page intentionally left blank.]
<PAGE>
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus, the Statement of
Additional Information or the Fund's official sales literature in connection
with the offering of the Fund's shares, and if given or made, such other
information or representations must not be relied on as having been authorized
by the Fund. This Prospectus does not constitute an offer in any state in which,
or to any person to whom, such offer may not be lawfully made.
-------------
INVESTMENT MANAGER:
Fred Alger Management, Inc.
75 Maiden Lane
New York, New York 10038
DISTRIBUTOR:
Fred Alger & Company, Incorporated
30 Montgomery Street
Jersey City, New Jersey 07302
TRANSFER AGENT:
Alger Shareholder Services, Inc.
30 Montgomery Street
Box 2001
Jersey City, New Jersey 07302
AUDITORS:
Arthur Andersen LLP
1345 Avenue of the Americas
New York, New York 10105
COUNSEL:
Hollyer Brady Smith Troxell
Barrett Rockett Hines & Mone LLP
551 Fifth Avenue
New York, NY 10176
AS197
The Alger Fund|
|
Meeting the challenge of investing
Alger Money Market Portfolio
Alger Small Capitalization Portfolio
Alger MidCap Growth Portfolio
Alger Growth Portfolio
Alger Balanced Portfolio
Alger Capital Appreciation Portfolio
PROSPECTUS|August 1, 1997
<PAGE>
STATEMENT OF
ADDITIONAL INFORMATION
- ----------------------
THE | 75 Maiden Lane
ALGER | New York, New York 10038
FUND | (800)992-FUND (992-3863)
================================================================================
The Alger Fund (the "Fund") is a registered investment company--a mutual
fund--that presently offers interests in the following six portfolios (the
"Portfolios"):
* Alger Money Market Portfolio
* Alger Balanced Portfolio
* Alger Growth Portfolio
* Alger MidCap Growth Portfolio
* Alger Small Capitalization Portfolio
* Alger Capital Appreciation Portfolio
With the exception of the Alger Money Market Portfolio, each Portfolio
offers three classes of shares, each with a different combination of sales
charges, ongoing fees and other features.
This Statement of Additional Information is not a Prospectus. This document
contains additional information about The Alger Fund and supplements information
in the Prospectus dated August 1, 1997. It should be read together with the
Prospectus which may be obtained free of charge by writing or calling the Fund
at the address or toll-free number shown above.
CONTENTS
Investment Objectives and Policies........................................ 2
Net Asset Value........................................................... 10
Purchases................................................................. 11
Redemptions............................................................... 13
Exchanges and Conversions................................................. 14
Management................................................................ 15
Taxes..................................................................... 17
Custodian and Transfer Agent.............................................. 19
Certain Shareholders...................................................... 19
Organization.............................................................. 20
Determination of Performance.............................................. 21
Appendix.................................................................. A-1
August 1, 1997
SAI17
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES
Certain Securities and Investment Techniques
The Prospectus discusses the investment objectives of each Portfolio and the
policies to be employed to achieve those objectives. This section contains
supplemental information concerning the types of securities and other
instruments in which the Portfolios may invest, the investment policies and
portfolio strategies that the Portfolios may utilize and certain risks attendant
to those investments, policies and strategies.
U.S. GOVERNMENT OBLIGATIONS
Bills, notes, bonds, and other debt securities issued by the U.S. Treasury are
direct obligations of the U.S. Government and differ mainly in the length of
their maturities.
U.S. GOVERNMENT AGENCY SECURITIES
These securities are issued or guaranteed by U.S. Government sponsored
enterprises and federal agencies. These include securities issued by the Federal
National Mortgage Association, Government National Mortgage Association, Federal
Home Loan Bank, Federal Land Banks, Farmers Home Administration, Banks for
Cooperatives, Federal Intermediate Credit Banks, Federal Financing Bank, Farm
Credit Banks, the Small Business Administration, Federal Housing Administration
and Maritime Administration. Some of these securities are supported by the full
faith and credit of the U.S. Treasury; and the remainder are supported only by
the credit of the instrumentality, which may or may not include the right of the
issuer to borrow from the Treasury.
BANK OBLIGATIONS
These are certificates of deposit, bankers' acceptances, and other short-term
debt obligations. Certificates of deposit are short-term obligations of
commercial banks. A bankers' acceptance is a time draft drawn on a commercial
bank by a borrower, usually in connection with international commercial
transactions. Certificates of deposit may have fixed or variable rates.
The Portfolios will not invest in any debt security issued by a commercial bank
unless (i) the bank has total assets of at least $1 billion, or the equivalent
in other currencies, or, in the case of domestic banks which do not have total
assets of at least $1 billion, the aggregate investment made in any one such
bank is limited to $100,000 and the principal amount of such investment is
insured in full by the Federal Deposit Insurance Corporation, (ii) in the case
of U.S. banks, it is a member of the Federal Deposit Insurance Corporation, and
(iii) in the case of foreign banks, the security is, in the opinion of Fred
Alger Management, Inc. ("Alger Management") the Fund's investment manager, of an
investment quality comparable to other debt securities which may be purchased by
the Portfolios. These limitations do not prohibit investments in securities
issued by foreign branches of U.S. banks, provided such U.S. banks meet the
foregoing requirements.
FOREIGN BANK OBLIGATIONS
Investments by the Portfolios in foreign bank obligations and obligations of
foreign branches of domestic banks present certain risks, including the impact
of future political and economic developments, the possible imposition of
withholding taxes on interest income, the possible seizure or nationalization of
foreign deposits, the possible establishment of exchange controls and/or the
addition of other foreign governmental restrictions that might affect adversely
the payment of principal and interest on these obligations. In addition, there
may be less publicly available and reliable information about a foreign bank
than about domestic banks owing to different accounting, auditing, reporting and
recordkeeping standards. In view of these risks, Alger Management will carefully
evaluate these investments on a case-by-case basis.
SHORT-TERM CORPORATE DEBT SECURITIES
These are outstanding nonconvertible corporate debt securities (e.g., bonds and
debentures) which have one year or less remaining to maturity. Corporate notes
may have fixed, variable, or floating rates.
COMMERCIAL PAPER
These are short-term promissory notes issued by corporations primarily to
finance short-term credit needs.
VARIABLE RATE MASTER DEMAND NOTES
These are unsecured instruments that permit the indebtedness thereunder to vary
and provide for periodic adjustments in the interest rate. Because these notes
are direct lending arrangements between the Portfolio and the issuer, they are
not normally traded. Although no active secondary market may exist for these
notes, the Portfolio may demand payment of principal and accrued interest at any
time or may resell the note to a third party. While the notes are not typically
rated by credit rating agencies, issuers of variable rate master demand notes
must satisfy Alger Management that the same criteria for issuers of commercial
paper are met. In addition, when purchasing variable rate master demand notes,
Alger Management will consider the earning power, cash flows and other liquidity
2
<PAGE>
ratios of the issuers of the notes and will continuously monitor their financial
status and ability to meet payment on demand. In the event an issuer of a
variable rate master demand note were to default on its payment obligations, the
Portfolio might be unable to dispose of the note because of the absence of a
secondary market and could, for this or other reasons, suffer a loss to the
extent of the default.
REPURCHASE AGREEMENTS
Under the terms of a repurchase agreement, a Portfolio would acquire a high
quality money market instrument for a relatively short period (usually not more
than one week) subject to an obligation of the seller to repurchase, and the
Portfolio to resell, the instrument at an agreed price (including accrued
interest) and time, thereby determining the yield during the Portfolio's holding
period. Repurchase agreements may be seen to be loans by the Portfolio
collateralized by the underlying instrument. This arrangement results in a fixed
rate of return that is not subject to market fluctuations during the Portfolio's
holding period and not necessarily related to the rate of return on the
underlying instrument. The value of the underlying securities, including accrued
interest, will be at least equal at all times to the total amount of the
repurchase obligation, including interest. A Portfolio bears a risk of loss in
the event that the other party to a repurchase agreement defaults on its
obligations and the Portfolio is delayed in or prevented from exercising its
rights to dispose of the collateral securities, including the risk of a possible
decline in the value of the underlying securities during the period in which the
Portfolio seeks to assert these rights, the risk of incurring expenses
associated with asserting these rights and the risk of losing all or part of the
income from the agreement. Alger Management, acting under the supervision of the
Fund's Board of Trustees, reviews the credit worthiness of those banks and
dealers with which the Portfolios enter into repurchase agreements to evaluate
these risks and monitors on an ongoing basis the value of the securities subject
to repurchase agreements to ensure that the value is maintained at the required
level.
REVERSE REPURCHASE AGREEMENTS (ALGER MONEY
MARKET PORTFOLIO AND ALGER BALANCED PORTFOLIO)
Reverse repurchase agreements are the same as repurchase agreements except that,
in this instance, the Portfolio would assume the role of seller/borrower in the
transaction. Each Portfolio will maintain segregated accounts with the Fund's
custodian consisting of cash or liquid securities that at all times are in an
amount equal to its obligations under reverse repurchase agreements. The
Portfolios will invest the proceeds in money market instruments or repurchase
agreements maturing not later than the expiration of the reverse repurchase
agreement. Reverse repurchase agreements involve the risk that the market value
of the securities sold by a Portfolio may decline below the repurchase price of
the securities. Under the Investment Company Act of 1940, as amended (the
"Act"), reverse repurchase agreements may be considered borrowings by the
seller; accordingly, the Portfolio will limit its investments in reverse
repurchase agreements and other borrowings to no more than one-third of its
total assets.
FIRM COMMITMENT AGREEMENTS AND
WHEN-ISSUED PURCHASES (ALGER MONEY MARKET
PORTFOLIO AND THE ALGER BALANCED PORTFOLIO)
Firm commitment agreements and "when-issued" purchases call for the purchase of
securities at an agreed price on a specified future date and would be used, for
example, when a decline in the yield of securities of a given issuer is
anticipated and a more advantageous yield may be obtained by committing
currently to purchase securities to be issued later. When the Portfolio
purchases a security under a firm commitment agreement or on a when-issued basis
it assumes the risk of any decline in value of the security occurring between
the date of the agreement or purchase and the settlement date of the
transaction. The Portfolio will not use these transactions for leveraging
purposes and, accordingly, will segregate with the Fund's custodian cash or
liquid securities in an amount sufficient at all times to meet its purchase
obligations under these agreements.
WARRANTS AND RIGHTS
Each Portfolio may invest in warrants and rights. A warrant is a type of
security that entitles the holder to buy a proportionate amount of common stock
at a specified price, usually higher than the market price at the time of
issuance, for a period of years or to perpetuity. In contrast, rights, which
also represent the right to buy common shares, normally have a subscription
price lower than the current market value of the common stock and a life of two
to four weeks. Warrants are freely transferable and are traded on the major
securities exchanges.
RESTRICTED SECURITIES
Each Portfolio may invest in restricted securities governed by Rule 144A under
the Securities Act of 1933. In adopting Rule 144A, the Securities and Exchange
Commission specifically stated that restricted securities traded under Rule 144A
may be treated as liquid for purposes of investment limitations if the board of
3
<PAGE>
trustees (or the fund's adviser acting subject to the board's supervision)
determines that the securities are in fact liquid. The Board of Trustees has
delegated its responsibility to Alger Management to determine the liquidity of
each restricted security purchased pursuant to the Rule, subject to the Board of
Trustees' oversight and review. Examples of factors that will be taken into
account in evaluating the liquidity of a Rule 144A security, both with respect
to the initial purchase and on an ongoing basis, will include, among others: (1)
the frequency of trades and quotes for the security; (2) the number of dealers
willing to purchase or sell the security and the number of other potential
purchasers; (3) dealer undertakings to make a market in the security; and (4)
the nature of the security and the nature of the marketplace trades (e.g., the
time needed to dispose of the security, the method of soliciting offers, and the
mechanics of transfer). Because institutional trading in restricted securities
is relatively new, it is not possible to predict how institutional markets will
develop. If institutional trading in restricted securities were to decline to
limited levels, the liquidity of the Fund's Portfolio could be adversely
affected.
SHORT SALES
Each Portfolio other than Alger Money Market Portfolio may sell securities
"short against the box." While a short sale is the sale of a security the
Portfolio does not own, it is "against the box" if at all times when the short
position is open the Portfolio owns an equal amount of the securities or
securities convertible into, or exchangeable without further consideration for,
securities of the same issue as the securities sold short.
LENDING OF PORTFOLIO SECURITIES
Each Portfolio may lend securities to brokers, dealers and other financial
organizations. The Portfolios will not lend securities to Alger Management or
its affiliates. By lending its securities, a Portfolio can increase its income
by continuing to receive interest or dividends on the loaned securities as well
as by either investing the cash collateral in short-term securities or by
earning income in the form of interest paid by the borrower when U.S. Government
securities or letters of credit are used as collateral. Each Portfolio will
adhere to the following conditions whenever its securities are loaned: (a) the
Portfolio must receive at least 100 percent cash collateral or equivalent
securities from the borrower; (b) the borrower must increase this collateral
whenever the market value of the securities including accrued interest exceeds
the value of the collateral; (c) the Portfolio must be able to terminate the
loan at any time; (d) the Portfolio must receive reasonable interest on the
loan, as well as any dividends, interest or other distributions on the loaned
securities and any increase in market value; (e) the Portfolio may pay only
reasonable custodian fees in connection with the loan; and (f) voting rights on
the loaned securities may pass to the borrower; provided, however, that if a
material event adversely affecting the investment occurs, the Fund's Board of
Trustees must terminate the loan and regain the right to vote the securities. A
Portfolio bears a risk of loss in the event that the other party to a stock loan
transaction defaults on its obligations and the Portfolio is delayed in or
prevented from exercising its rights to dispose of the collateral including the
risk of a possible decline in the value of the collateral securities during the
period in which the Portfolio seeks to assert these rights, the risk of
incurring expenses associated with asserting these rights and the risk of losing
all or a part of the income from the transaction.
FOREIGN SECURITIES
Each Portfolio other than Alger Money Market Portfolio may invest up to 20% of
the value of its total assets in foreign securities (not including American
Depositary Receipts, American Depositary Shares or U.S. dollar-denominated
securities of foreign issuers). Foreign securities investments may be affected
by changes in currency rates or exchange control regulations, changes in
governmental administration or economic or monetary policy (in the United States
and abroad) or changed circumstances in dealing between nations. Dividends paid
by foreign issuers may be subject to withholding and other foreign taxes that
may decrease the net return on these investments as compared to dividends paid
to the Portfolio by domestic corporations. It should be noted that there may be
less publicly available information about foreign issuers than about domestic
issuers, and foreign issuers are not subject to uniform accounting, auditing and
financial reporting standards and requirements comparable to those of domestic
issuers. Securities of some foreign issuers are less liquid and more volatile
than securities of comparable domestic issuers and foreign brokerage commissions
are generally higher than in the United States. Foreign securities markets may
also be less liquid, more volatile and less subject to government supervision
than those in the United States. Investments in foreign countries could be
affected by other factors not present in the United States, including
expropriation, confiscatory taxation and potential difficulties in enforcing
contractual obligations. Securities purchased on foreign exchanges may be held
in custody by a foreign branch of a domestic bank.
4
<PAGE>
OPTIONS (ALGER CAPITAL APPRECIATION PORTFOLIO)
A call option on a security is a contract that gives the holder of the option
the right, in return for a premium paid, to buy from the writer (seller) of the
call option the security underlying the option at a specified exercise price at
any time during the term of the option. The writer of the call option has the
obligation upon exercise of the option to deliver the underlying security upon
payment of the exercise price during the option period. A put option on a
security is a contract that, in return for the premium, gives the holder of the
option the right to sell to the writer (seller) the underlying security at a
specified price during the term of the option. The writer of the put, who
receives the premium, has the obligation to buy the underlying security upon
exercise at the exercise price during the option period.
A call option on a security is "covered" if the Portfolio owns the underlying
security covered by the call or has an absolute and immediate right to acquire
that security without additional cash consideration (or for additional cash
consideration held in a segregated account by its custodian) upon conversion or
exchange of other securities held in its portfolio. A call option is also
covered if the Portfolio holds a call on the same security as the call written
where the exercise price of the call held is (1) equal to or less than the
exercise price of the call written or (2) greater than the exercise price of the
call written if the difference is maintained by the Portfolio in cash, U.S.
Government securities or other high grade short-term obligations in a segregated
account held with its custodian. A put option is "covered" if the Portfolio
maintains cash or other high grade short-term obligations with a value equal to
the exercise price in a segregated account held with its custodian, or else
holds a put on the same security as the put written where the exercise price of
the put held is equal to or greater than the exercise price of the put written.
If the Portfolio has written an option, it may terminate its obligation by
effecting a closing purchase transaction. This is accomplished by purchasing an
option of the same series as the option previously written. However, once the
Portfolio has been assigned an exercise notice, the Portfolio will be unable to
effect a closing purchase transaction. Similarly, if the Portfolio is the holder
of an option it may liquidate its position by effecting a closing sale
transaction. This is accomplished by selling an option of the same series as the
option previously purchased. There can be no assurance that either a closing
purchase or sale transaction can be effected when the Portfolio so desires.
The Portfolio will realize a profit from a closing transaction if the price of
the transaction is less than the premium received from writing the option or is
more than the premium paid to purchase the option; the Portfolio will realize a
loss from a closing transaction if the price of the transaction is less than the
premium paid to purchase the option. Since call option prices generally reflect
increases in the price of the underlying security, any loss resulting from the
repurchase of a call option may also be wholly or partially offset by unrealized
appreciation of the underlying security. Other principal factors affecting the
market value of a put or a call option include supply and demand, interest
rates, the current market price and price volatility of the underlying security
and the time remaining until the expiration date.
An option position may be closed out only on an exchange which provides a
secondary market for an option of the same series. Although the Portfolio will
generally purchase or write only those options for which there appears to be an
active secondary market, there is no assurance that a liquid secondary market on
an exchange will exist for any particular option. In such event it might not be
possible to effect closing transactions in particular options, so that the
Portfolio would have to exercise its option in order to realize any profit and
would incur brokerage commissions upon the exercise of the options. If the
Portfolio, as a covered call option writer, is unable to effect a closing
purchase transaction in a secondary market, it will not be able to sell the
underlying security until the option expires or it delivers the underlying
security upon exercise or otherwise covers the position. In addition to options
on securities, the Portfolio may also purchase and sell call and put options on
securities indexes. A stock index reflects in a single number the market value
of many different stocks. Relative values are assigned to the stocks included in
an index and the index fluctuates with changes in the market values of the
stocks. The options give the holder the right to receive a cash settlement
during the term of the option based on the difference between the exercise price
and the value of the index. By writing a put or call option on a securities
index, the Portfolio is obligated, in return for the premium received, to make
delivery of this amount. The Portfolio may offset its position in stock index
options prior to expiration by entering into a closing transaction on an
exchange or it may let the option expire unexercised.
Use of options on securities indexes entails the risk that trading in the
options may be interrupted if trading in certain securities included in the
5
<PAGE>
index is interrupted. The Portfolio will not purchase these options unless Alger
Management is satisfied with the development, depth and liquidity of the market
and Alger Management believes the options can be closed out. Price movements in
the Portfolio's securities may not correlate precisely with movements in the
level of an index and, therefore, the use of options on indexes cannot serve as
a complete hedge and will depend, in part, on the ability of Alger Management to
predict correctly movements in the direction of the stock market generally or of
a particular industry. Because options on securities indexes require settlement
in cash, Alger Management may be forced to liquidate portfolio securities to
meet settlement obligations. The Portfolio has qualified and intends to continue
to qualify as a "Regulated Investment Company" under the Internal Revenue Code.
One requirement for such qualification is that the Portfolio must derive less
than 30% of its gross income from gains from the sale or other disposition of
securities held for less than three months. Therefore, the Portfolio may be
limited in its ability to engage in options transactions. Although Alger
Management will attempt to take appropriate measures to minimize the risks
relating to the Portfolio's writing of put and call options, there can be no
assurance that the Portfolio will succeed in any option-writing program it
undertakes.
STOCK INDEX FUTURES AND OPTIONS ON STOCK
INDEX FUTURES (ALGER CAPITAL APPRECIATION
PORTFOLIO)
Futures are generally bought and sold on the commodities exchanges where they
are listed with payment of initial and variation margin as described below. The
sale of a futures contract creates a firm obligation by the Portfolio, as
seller, to deliver to the buyer the net cash amount called for in the contract
at a specific future time. Put options on futures might be purchased to protect
against declines in the market values of securities occasioned by a decline in
stock prices and securities index futures might be sold to protect against a
general decline in the value of securities of the type that comprise the index.
Options on futures contracts are similar to options on securities except that an
option on a futures contract gives the purchaser the right in return for the
premium paid to assume a position in a futures contract and obligates the seller
to deliver such position.
A stock index future obligates the seller to deliver (and the purchaser to take)
an amount of cash equal to a specific dollar amount times the difference between
the value of a specific stock index at the close of the last trading day of the
contract and the price at which the agreement is made. No physical delivery of
the underlying stocks in the index is made. With respect to stock indexes that
are permitted investments, the Portfolio intends to purchase and sell futures
contracts on the stock index for which it can obtain the best price with
considerations also given to liquidity. While incidental to its securities
activities, the Portfolio may use index futures as a substitute for a comparable
market position in the underlying securities.
The risk of imperfect correlation increases as the composition of the Portfolio
varies from the composition of the stock index. In an effort to compensate for
the imperfect correlation of movements in the price of the securities being
hedged and movements in the price of the stock index futures, the Portfolio may
buy or sell stock index futures contracts in a greater or lesser dollar amount
than the dollar amount of the securities being hedged if the historical
volatility of the stock index futures has been less or greater than that of the
securities. Such "over hedging" or "under hedging" may adversely affect the
Portfolio's net investment results if market movements are not as anticipated
when the hedge is established.
An option on a stock index futures contract, as contrasted with the direct
investment in such a contract, gives the purchaser the right, in return for the
premium paid, to assume a position in a stock index futures contract at a
specified exercise price at any time prior to the expiration date of the option.
The Portfolio will sell options on stock index futures contracts only as part of
closing purchase transactions to terminate its options positions. No assurance
can be given that such closing transactions can be effected or that there will
be correlation between price movements in the options on stock index futures and
price movements in the Portfolio's securities which are the subject of the
hedge. In addition, the Portfolio's purchase of such options will be based upon
predictions as to anticipated market trends, which could prove to be inaccurate.
The Portfolio's use of stock index futures and options thereon will in all cases
be consistent with applicable regulatory requirements and in particular the
rules and regulations of the Commodity Futures Trading Commission and will be
entered into only for bona fide hedging, risk management or other portfolio
management purposes. Typically, maintaining a futures contract or selling an
option thereon requires the Portfolio to deposit with a financial intermediary
as security for its obligations an amount of cash or other specified assets
(initial margin) which initially is typically 1% to 10% of the face amount of
the contract (but may be higher in some circumstances). Additional cash or
assets (variation margin) may be required to be deposited thereafter on a daily
6
<PAGE>
basis as the mark to market value of the contract fluctuates. The purchase of an
option on stock index futures involves payment of a premium for the option
without any further obligation on the part of the Portfolio. If the Portfolio
exercises an option on a futures contract it will be obligated to post initial
margin (and potential subsequent variation margin) for the resulting futures
position just as it would for any position. Futures contracts and options
thereon are generally settled by entering into an offsetting transaction but
there can be no assurance that the position can be offset prior to settlement at
an advantageous price, nor that delivery will occur.
The Portfolio will not enter into a futures contract or related option (except
for closing transactions) if, immediately thereafter, the sum of the amount of
its initial margin and premiums on open futures contracts and options thereon
would exceed 5% of the Portfolio's total assets (taken at current value);
however, in the case of an option that is in-the-money at the time of the
purchase, the in-the-money amount may be excluded in calculating the 5%
limitation.
INVESTMENT RESTRICTIONS
The investment restrictions numbered 1 through 12 below have been adopted by the
Fund with respect to each of the Portfolios as fundamental policies. Under the
Act, a "fundamental" policy may not be changed without the vote of a "majority
of the outstanding voting securities" of the Fund, which is defined in the Act
as the lesser of (a) 67 percent or more of the shares present at a Fund meeting
if the holders of more than 50 percent of the outstanding shares of the Fund are
present or represented by proxy or (b) more than 50 percent of the outstanding
shares. A fundamental policy affecting a particular Portfolio may not be changed
without the vote of a majority of the outstanding voting securities of the
affected Portfolio. Investment restrictions 13 through 19 may be changed by vote
of a majority of the Fund's Board of Trustees at any time.
The investment policies adopted by the Fund prohibit each Portfolio from:
1. Purchasing the securities of any issuer, other than U.S. Government
securities, if as a result more than five percent of the value of the
Portfolio's total assets would be invested in the securities of the issuer,
except that up to 25 percent of the value of the Portfolio's (other than Alger
Money Market Portfolio's) total assets may be invested without regard to this
limitation.
2. Purchasing more than 10 percent of the voting securities of any one issuer or
more than 10 percent of the securities of any class of any one issuer. This
limitation shall not apply to investments in U.S. Government securities.
3. Selling securities short or purchasing securities on margin, except that the
Portfolio may obtain any short-term credit necessary for the clearance of
purchases and sales of securities. These restrictions shall not apply to
transactions involving selling securities "short against the box."
4. Borrowing money, except that (a) all Portfolios may borrow for temporary or
emergency purposes including the meeting of redemption requests that might
otherwise require the untimely disposition of securities, in an amount not
exceeding 10 percent of the value of the Portfolio's total assets (including the
amount borrowed) valued at the lesser of cost or market, less liabilities (not
including the amount borrowed) at the time the borrowing is made; (b) Alger
Money Market Portfolio and Alger Balanced Portfolio may engage in transactions
in reverse repurchase agreements; and (c) Alger Capital Appreciation Portfolio
may borrow from banks for investment purposes as set forth in the Prospectus.
Whenever borrowings described in (a) exceed five percent of the value of the
Portfolio's total assets, the Portfolio will not make any additional
investments. Immediately after any borrowing, including reverse repurchase
agreements, the Portfolio will maintain asset coverage of not less than 300
percent with respect to all borrowings.
5. Pledging, hypothecating, mortgaging or otherwise encumbering more than 10
percent of the value of the Portfolio's total assets except in connection with
borrowings as noted in 4(c) above. These restrictions shall not apply to
transactions involving reverse repurchase agreements or the purchase of
securities subject to firm commitment agreements or on a when-issued basis.
6. Issuing senior securities, except in connection with borrowings permitted
under restriction 4.
7. Underwriting the securities of other issuers, except insofar as the Portfolio
may be deemed to be an underwriter under the Securities Act of 1933, as amended,
by virtue of disposing of portfolio securities.
8. Making loans to others, except through purchasing qualified debt obligations,
lending portfolio securities or entering into repurchase agreements.
9. Investing in securities of other investment companies, except as they may be
acquired as part of a merger, consolidation, reorganization, acquisition of
assets or offer of exchange.
7
<PAGE>
10. Purchasing any securities that would cause more than 25 percent of the value
of the Portfolio's total assets to be invested in the securities of issuers
conducting their principal business activities in the same industry; provided
that (a) there shall be no limit on the purchase of U.S. Government securities,
and (b) there shall be no limit on the purchase by Alger Money Market Portfolio
of obligations issued by bank and thrift institutions described in the
Prospectus and this Statement of Additional Information.
11. Investing in commodities, except that Alger Capital Appreciation Portfolio
may purchase or sell stock index futures contracts and related options thereon
if, thereafter, no more than 5 percent of its total assets are invested in
margin and premiums.
12. Investing more than 10 percent (15 percent in the case of Alger Capital
Appreciation Portfolio) of its net assets in securities which are illiquid by
virtue of legal or contractual restrictions on resale or the absence of a
readily available market. However, securities with legal or contractual
restrictions on resale may be purchased by Alger Money Market Portfolio if they
are determined to be liquid, and such purchases would not be subject to the 10
percent limit stated above. The Board of Trustees will in good faith determine
the specific types of securities deemed to be liquid and the value of such
securities held in Alger Money Market Portfolio. Alger Money Market Portfolio
will not purchase time deposits maturing in more than seven calendar days and
will limit to no more than 10 percent of its assets its investment in time
deposits maturing in excess of two business days, together with all other
illiquid securities.
13. Purchasing or selling real estate or real estate limited partnerships,
except that the Portfolio may purchase and sell securities secured by real
estate, mortgages or interests therein and securities that are issued by
companies that invest or deal in real estate.
14. Writing or selling puts, calls, straddles, spreads or combinations thereof,
except that Alger Capital Appreciation Portfolio may buy and sell (write) in
options.
15. Investing in oil, gas or other mineral exploration or development programs,
except that the Portfolio may invest in the securities of companies that invest
in or sponsor those programs.
16. Purchasing any security if, as a result, the Portfolio would then have more
than five percent of its total assets invested in securities of issuers
(including predecessors) that have been in continual operation for less than
three years. This limitation shall not apply to investments in U.S. Government
securities.
17. Making investments for the purpose of exercising control or management.
18. Investing in warrants, except that the Portfolio may invest in warrants if,
as a result, the investments (valued at the lower of cost or market) would not
exceed five percent of the value of the Portfolio's net assets, of which not
more than two percent of the Portfolio's net assets may be invested in warrants
not listed on a recognized domestic stock exchange. Warrants acquired by the
Portfolio as part of a unit or attached to securities at the time of acquisition
are not subject to this limitation.
19. Purchasing or retaining the securities of any issuer if, to the knowledge of
the Fund, any of the officers, directors or trustees of the Fund or Alger
Management individually owns more than .5 percent of the outstanding securities
of the issuer and together they own beneficially more than five percent of the
securities.
As of April 29, 1994, shares of Alger Growth Portfolio, Alger Small
Capitalization Portfolio and Alger MidCap Growth Portfolio were registered for
sale in Germany. As long as Alger Growth Portfolio, Alger Small Capitalization
Portfolio and Alger MidCap Growth Portfolio are registered in Germany, these
Portfolios may not without prior approval of their shareholders:
a.Invest in the securities of any other domestic or foreign investment
company or investment fund except in connection with a plan of merger or
consolidation with or acquisition of substantially all the assets of such
other investment company or investment fund;
b.Purchase or sell real estate or any interest therein, and real estate
mortgage loans, except that the Portfolios may invest in securities of
corporate or governmental entities secured by real estate or marketable
interests therein or securities issued by companies (other than real estate
limited partnerships, real estate investment trusts and real estate funds)
that invest in real estate or interests therein;
c.Borrow money, except for temporary or emergency (but not leveraging)
purposes including the meeting of redemption requests that might otherwise
require the untimely disposition of securities, in an amount not exceeding
10 percent of the value of the Portfolio's total assets (including the
amount borrowed) valued at the lesser of cost or market, less liabilities
(not including the amount borrowed) at the time the borrowing is made;
8
<PAGE>
d.Pledge, hypothecate, mortgage or otherwise encumber their assets except to
secure indebtedness permitted under section c.;
e. Purchase securities on margin or make short sales; or;
f. Redeem their securities in kind.
These Portfolios will comply with the more restrictive policies required by the
German regulatory authorities, as stated above, as long as such Portfolios are
registered in Germany.
Except in the case of the 300 percent limitation set forth in Investment
Restriction No. 4 and as may be stated otherwise, the percentage limitations
contained in the foregoing restrictions and in the Fund's other investment
policies apply at the time of the purchase of the securities and a later
increase or decrease in percentage resulting from a change in the values of the
securities or in the amount of the Portfolio's assets will not constitute a
violation of the restriction.
PORTFOLIO TRANSACTIONS
Decisions to buy and sell securities and other financial instruments for a
Portfolio are made by Alger Management, which also is responsible for placing
these transactions, subject to the overall review of the Fund's Board of
Trustees. Although investment requirements for each Portfolio are reviewed
independently from those of the other accounts managed by Alger Management and
those of the other Portfolios, investments of the type the Portfolios may make
may also be made by these other accounts or Portfolios. When a Portfolio and one
or more other Portfolios or accounts managed by Alger Management are prepared to
invest in, or desire to dispose of, the same security or other financial
instrument, available investments or opportunities for sales will be allocated
in a manner believed by Alger Management to be equitable to each. In some cases,
this procedure may affect adversely the price paid or received by a Portfolio or
the size of the position obtained or disposed of by a Portfolio.
Transactions in equity securities are in many cases effected on U. S. stock
exchanges and involve the payment of negotiated brokerage commissions. There is
generally no stated commission in the case of securities traded in the
over-the-counter markets, but the prices of those securities include undisclosed
commissions or mark-ups. Purchases and sales of money market instruments and
debt securities usually are principal transactions. These securities are
normally purchased directly from the issuer or from an underwriter or market
maker for the securities. The cost of securities purchased from underwriters
includes an underwriting commission or concession and the prices at which
securities are purchased from and sold to dealers include a dealer's mark-up or
mark-down. U. S. Government securities are generally purchased from underwriters
or dealers, although certain newly-issued U. S. Government securities may be
purchased directly from the U. S. Treasury or from the issuing agency or
instrumentality.
To the extent consistent with applicable provisions of the Act and the rules and
exemptions adopted by the Securities and Exchange Commission (the "SEC")
thereunder, as well as other regulatory requirements, the Fund's Board of
Trustees has determined that portfolio transactions will be executed through
Fred Alger & Company, Incorporated ("Alger Inc.") if, in the judgment of Alger
Management, the use of Alger Inc. is likely to result in price and execution at
least as favorable as those of other qualified broker-dealers and if, in
particular transactions, Alger Inc. charges the Portfolio involved a rate
consistent with that charged to comparable unaffiliated customers in similar
transactions. Such transactions will be fair and reasonable to the Portfolio's
shareholders. Over-the-counter purchases and sales are transacted directly with
principal market makers except in those cases in which better prices and
executions may be obtained elsewhere. Principal transactions are not entered
into with affiliates of the Fund except pursuant to exemptive rules or orders
adopted by the SEC.
In selecting brokers or dealers to execute portfolio transactions on behalf of a
Portfolio, Alger Management seeks the best overall terms available. In assessing
the best overall terms available for any transaction, Alger Management will
consider the factors it deems relevant, including the breadth of the market in
the investment, the price of the investment, the financial condition and
execution capability of the broker or dealer and the reasonableness of the
commission, if any, for the specific transaction and on a continuing basis. In
addition, Alger Management is authorized, in selecting parties to execute a
particular transaction and in evaluating the best overall terms available, to
consider the brokerage and research services, as those terms are defined in
section 28(e) of the Securities Exchange Act of 1934, provided to the Portfolio
involved, the other Portfolios and/or other accounts over which Alger Management
or its affiliates exercise investment discretion. The Fund will consider sales
of its shares as a factor in the selection of broker-dealers to execute
over-the-counter transactions, subject to the requirements of best price and
9
<PAGE>
execution. Alger Management's fees under its agreements with the Portfolios are
not reduced by reason of its receiving brokerage and research service. The
Fund's Board of Trustees will periodically review the commissions paid by the
Portfolios to determine if the commissions paid over representative periods of
time are reasonable in relation to the benefits inuring to the Portfolios.
During the fiscal years ended October 31, 1994, 1995, and 1996, the Fund paid an
aggregate of approximately $763,784, $799,446 and $1,554,261 respectively, in
commissions to Alger Inc. in connection with portfolio transactions. The
commissions paid to Alger Inc. during the fiscal year ended October 31, 1996
constituted 92% of the aggregate brokerage commissions paid by the Fund; during
that year, __% of the aggregate dollar amount of transactions by the Fund
involving the payment of brokerage commissions was effected through Alger Inc.
Alger Inc. does not engage in principal transactions with the Fund and,
accordingly, received no compensation in connection with securities purchased or
sold in that manner, which include securities traded in the over-the-counter
markets, money market investments and most debt securities.
NET ASSET VALUE
The Prospectus discusses the time at which the net asset values of the classes
of each Portfolio are determined for purposes of sales and redemptions. The New
York Stock Exchange ("NYSE") is currently open on each Monday through Friday,
except (i) January 1st, Presidents' Day (the third Monday in February), Good
Friday, Memorial Day (the last Monday in May), Independence Day, Labor Day (the
first Monday in September), Thanksgiving Day (the fourth Thursday in November)
and December 25th and (ii) the preceding Friday when any one of those holidays
falls on a Saturday, or the subsequent Monday when any one of those holidays
falls on a Sunday. The following is a description of the procedures used by the
Fund in valuing the Portfolios' assets.
The assets of the Portfolios other than Alger Money Market Portfolio are
generally valued on the basis of market quotations. Securities whose principal
market is on an exchange or in the over-the-counter market are valued at the
last reported sales price or, in the absence of reported sales, at the mean
between the bid and asked price or, in the absence of a recent bid or asked
price, the equivalent as obtained from one or more of the major market makers
for the securities to be valued. Bonds and other fixed income securities may be
valued on the basis of prices provided by a pricing service when the Fund's
Board of Trustees believes that these prices reflect the fair market value of
the securities. Other investments and other assets, including restricted
securities and securities for which market quotations are not readily available,
are valued at fair value under procedures approved by the Fund's Board of
Trustees. Short-term securities with maturities of 60 days or less are valued at
amortized cost, as described below, which constitutes fair value as determined
by the Fund's Board of Trustees.
The valuation of the securities held by Alger Money Market Portfolio, as well as
money market instruments with maturities of 60 days or less held by the other
Portfolios, is based on their amortized cost which does not take into account
unrealized capital gains or losses. Amortized cost valuation involves initially
valuing an instrument at its cost and thereafter assuming a constant
amortization to maturity of any discount or premium, regardless of the impact of
fluctuating interest rates on the market value of the instrument. Although this
method provides certainty in valuation, it may result in periods during which
value, as determined by amortized cost, is higher or lower than the price a
Portfolio would receive if it sold the instrument.
Alger Money Market Portfolio's use of the amortized cost method of valuing its
securities is permitted by a rule adopted by the SEC. Under this rule, the
Portfolio must maintain a dollar-weighted average portfolio maturity of 90 days
or less, purchase only instruments having remaining maturities of less than 397
days, as determined in accordance with the provisions of the rule, and invest
only in securities determined by Alger Management, acting under the supervision
of the Fund's Board of Trustees, to be of high quality with minimal credit
risks.
Pursuant to the rule, the Fund's Board of Trustees also has established
procedures designed to stabilize, to the extent reasonably possible, Alger Money
Market Portfolio's price per share as computed for the purpose of sales and
redemptions at $1.00. These procedures include review of the Portfolio's
holdings by the Fund's Board of Trustees, at such intervals as it deems
appropriate, to determine whether the Portfolio's net asset value calculated by
using available market quotations or market equivalents deviates from $1.00 per
share based on amortized cost.
The rule also provides that the extent of any deviation between the Portfolio's
net asset value based on available market quotations or market equivalents and
$1.00 per share net asset value based on amortized cost must be examined by the
Fund's Board of Trustees. In the event the Fund's Board of Trustees determines
that a deviation exists that may result in material dilution or other unfair
10
<PAGE>
results to investors or existing shareholders, pursuant to the rule the Fund's
Board of Trustees must cause the Portfolio to take such corrective action as the
Fund's Board of Trustees regards as necessary and appropriate, including:
selling portfolio instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity, withholding dividends or paying
distributions from capital or capital gains, redeeming shares in kind or
establishing net asset value per share by using available market quotations.
PURCHASES
Shares of the Portfolios are offered continuously by the Fund and are
distributed on a best efforts basis by Alger Inc. as principal underwriter for
the Fund pursuant to a distribution agreements (the "Distribution Agreements").
Under the Distribution Agreements, Alger Inc. bears all selling expenses,
including the costs of advertising and of printing prospectuses and distributing
them to prospective shareholders.
DISTRIBUTION PLANS
As stated in the Prospectus, in connection with the distribution activities of
Alger Inc. in respect of the Fund's Class B and Class C Shares, respectively,
the Fund has adopted two Distribution Plans (the "Plans") pursuant to Rule 12b-1
under the Act, one for each class.
Reimbursable distribution expenses covered under the Class B Plan may include
payments made to and expenses of persons who are engaged in, or provide support
services in connection with, the distribution of the class's shares, such as
answering routine telephone inquiries for prospective shareholders; compensation
in the form of sales concessions and continuing compensation paid to securities
dealers whose customers hold shares of the class; costs related to the
formulation and implementation of marketing and promotional activities,
including direct mail promotions and television, radio, newspaper, magazine and
other mass media advertising; costs of printing and distributing prospectuses
and reports to prospective shareholders of the class; costs involved in
preparing, printing and distributing sales literature for the class; and costs
involved in obtaining whatever information, analyses and reports with respect to
marketing and promotional activities on behalf of the class that the Fund deems
advisable.
It is anticipated that distribution expenses incurred by Alger Inc. during the
early years of a Portfolio's Class B Share operations will exceed the assets of
the class available for reimbursement under the Plan, while it is possible that
in later years the converse may be true. Distribution expenses incurred in a
year in respect of Class B Shares of a Portfolio in excess of contingent
deferred sales charges received by Alger Inc. relating to redemptions of shares
of the class during that year and .75 percent of the class' average daily net
assets may be carried forward and sought to be reimbursed in future years.
Interest at the prevailing broker loan rate may be charged to the applicable
Portfolio's Class B Shares on any expenses carried forward and those expenses
and interest will be reflected as current expenses on the Portfolio's statement
of operations for the year in which the amounts become accounting liabilities,
which is anticipated to be the year in which these amounts are actually paid.
Although the Fund's Board of Trustees may change this policy, it is currently
anticipated that payments under the Plan in a year will be applied first to
distribution expenses incurred in that year and then, up to the maximum amount
permitted under the Plan, to previously incurred but unreimbursed expenses
carried forward plus interest thereon.
The Plan for Class C Shares pays annually a flat percentage (up to .75 percent)
of the class's average daily net assets to Alger Inc., regardless of whether the
associated distribution expenses incurred are higher or lower than the fee. No
excess distribution expense shall be carried forward to subsequent years under
this Plan. Distribution services for which Alger Inc. is compensated under the
Class C Plan may include, but are not limited to, organizing and conducting
sales seminars, advertising programs, payment of finders' fees, printing of
prospectuses and statements of additional information and reports for other than
existing shareholders, preparation and distribution of advertising material and
sales literature, overhead, supplemental payments to dealers and other
institutions as asset-based sales charges or as payments of commissions or
service fees, and the costs of administering the Plan.
Alger Inc. has acknowledged that payments under the Plans are subject to the
approval of the Fund's Board of Trustees and that no Portfolio is contractually
obligated to make payments in any amount or at any time, including payments in
reimbursement of Alger Inc. for expenses and interest thereon incurred in a
prior year. Under their terms, the Plans remain in effect from year to year,
provided such continuation is approved in each case annually by vote of the
Fund's Board of Trustees, including a majority of the Trustees who are not
interested persons of the Fund and who have no direct or indirect financial
interest in the operation of the Plan ("Independent Trustees"). A Plan may not
11
<PAGE>
be amended to increase materially the amount to be spent for the services
provided by Alger Inc. without the approval of shareholders of the applicable
class, and all material amendments of a Plan must be approved by the Trustees in
the manner described above. A Plan may be terminated at any time, without
penalty, by vote of a majority of the Independent Trustees or, with respect to
the Class B or Class C Shares of any Portfolio to which a Plan relates, by a
vote of a majority of the outstanding voting securities of the class, on not
more than thirty days' written notice to any other party to the Plan. If a Plan
is terminated, or not renewed with respect to any one or more Portfolios, it may
continue in effect with respect to the Class B or Class C Shares of any
Portfolio as to which it has not been terminated, or has been renewed. Alger
Inc. will provide to the Board of Trustees quarterly reports of amounts expended
under each Plan and the purpose for which such expenditures were made. During
the fiscal year ended October 31, 1996, the Fund reimbursed $7,124,099 to Alger
Inc. as the Fund's underwriter, under the provisions of the Class B Shares'
Plan. Alger Inc.'s selling expenses during that period totaled $20,969,782 which
consisted of $1,150,159 in printing and mailing of prospectuses and other sales
literature to prospective investors; $2,136,299 in advertising; $15,253,965 in
compensation to dealers; $638,216 in compensation to sales personnel; $63,496 in
other marketing expenses; and $1,727,647 in interest, carrying or other
financing charges. The Plan for Class C Shares became effective on August 1 ,
1997. If in any month, the costs incurred by Alger Inc. are in excess of the
distribution expenses charged to Class B Shares of a Portfolio, the excess may
be carried forward, with interest, and sought to be reimbursed in future
periods.
SHAREHOLDER SERVICING AGREEMENT
Payments under the Shareholder Servicing Agreement are not tied exclusively to
the shareholder servicing expenses actually incurred by Alger Inc. and the
payments may exceed expenses actually incurred by Alger Inc. The Fund's Board of
Trustees evaluates the appropriateness of the Shareholder Servicing Agreement
and its payment terms on a continuing basis and in doing so considers all
relevant factors, including expenses borne by Alger Inc. and the amounts it
receives under the Shareholder Servicing Agreement.
EXPENSES OF THE FUND EACH
Portfolio will bear its own expenses. Operating expenses for each Portfolio
generally consist of all costs not specifically borne by Alger Management,
including investment management fees, fees for necessary professional and
brokerage services, costs of regulatory compliance and costs associated with
maintaining legal existence and shareholder relations. In addition, Class B and
Class C of each Portfolio other than Alger Money Market Portfolio may pay Alger
Inc. for expenses incurred in distributing shares of that class and each such
Portfolio may compensate Alger Inc. for servicing shareholder accounts. Fundwide
expenses not identifiable to any particular portfolio or class will be allocated
in a manner deemed fair and equitable by the Board of Trustees. From time to
time, Alger Management, in its sole discretion and as it deems appropriate, may
assume certain expenses of one or more of the Portfolios while retaining the
ability to be paid by the applicable Portfolio for such amounts prior to the end
of the fiscal year. This will have the effect of lowering the applicable
Portfolio's overall expense ratio and of increasing yield to investors, or the
converse, at the time such amounts are assumed or reimbursed, as the case may
be.
PURCHASES THROUGH PROCESSING ORGANIZATIONS
When shares are purchased this way, the Processing Organization, rather than its
customer, may be the shareholder of record of the shares. The minimum initial
and subsequent investments in classes of the Portfolios for shareholders who
invest through a Processing Organization will be set by the Processing
Organization. Processing Organizations may charge their customers a fee in
connection with services offered to customers.
TELEPURCHASE PRIVILEGE
The price the shareholder will receive will be the price next computed after
Alger Shareholder Services, Inc. (the "Transfer Agent") receives the investment
from the shareholder's bank, which is normally one banking day. While there is
no charge to shareholders for this service, a fee will be deducted from a
shareholder's Fund account in case of insufficient funds. This privilege may be
terminated at any time without charge or penalty by the shareholder, the Fund,
the Transfer Agent or Alger Inc. Class A Share purchases will remain subject to
the front-end load.
AUTOMATIC INVESTMENT PLAN
While there is no charge to shareholders for this service, a fee will be
deducted from a shareholder's Fund account in the case of insufficient funds. A
shareholder's Automatic Investment Plan may be terminated at any time without
charge or penalty by the shareholder, the Fund, the Transfer Agent or Alger Inc.
Class A Share purchases will remain subject to the front-end load.
AUTOMATIC EXCHANGE PLAN
There is no charge to shareholders for this service. A shareholder's Automatic
Exchange Plan may be terminated at any time without charge or penalty by the
shareholder, the Fund, the Transfer Agent or Alger Inc. If the automatic
exchange amount exceeds the Alger Money Market Portfolio balance, any remaining
balance in Alger Money Market Portfolio will be exchanged. Shares held in
certificate form are not eligible for this service. Class A Share purchases will
remain subject to the front-end load.
12
<PAGE>
REDEMPTIONS
The right of redemption of shares of a Portfolio may be suspended or the date of
payment postponed for more than seven days (a) for any periods during which the
NYSE is closed (other than for customary weekend and holiday closings), (b) when
trading in the markets the Portfolio normally utilizes is restricted, or an
emergency, as defined by the rules and regulations of the SEC, exists, making
disposal of the Portfolio's investments or determination of its net asset values
not reasonably practicable or (c) for such other periods as the SEC by order may
permit for protection of the Fund's shareholders.
CHECK REDEMPTION PRIVILEGE
Unless investors elect otherwise, checks drawn on jointly-owned accounts will be
honored with the signature of either of the joint owners. Shareholders should be
aware that use of the check redemption procedure does not give rise to a banking
relationship between the shareholder and the Transfer Agent, which will be
acting solely as transfer agent for the Portfolio; nor does it create a banking
relationship between the shareholder and the Fund. When a check is presented to
the Transfer Agent for payment, the Transfer Agent, as the investor's agent,
will cause the Fund to redeem a sufficient number of shares from the investor's
account to cover the amount of the check.
Shares for which stock certificates have been issued may not be redeemed by
check. An investor's account with Alger Money Market Portfolio will be reduced
by any contingent deferred sales charge applicable to any redemption, including
a redemption by check. The check redemption privilege may be modified or
terminated at any time by the Fund or by the Transfer Agent.
REDEMPTIONS IN KIND
Payment for shares tendered for redemption is ordinarily made in cash. However,
if the Board of Trustees of the Fund determines that it would be detrimental to
the best interest of the remaining shareholders of the Portfolio to make payment
of a redemption order wholly or partly in cash, the Portfolio may pay the
redemption proceeds in whole or in part by a distribution "in kind" of
securities from the Portfolio, in lieu of cash, in conformity with applicable
rules of the Securities and Exchange Commission. The Fund has elected to be
governed by Rule 18f-1 under the Act, pursuant to which a Portfolio is obligated
to redeem shares solely in cash up to the lesser of $250,000 or 1% of the net
assets of the Portfolio during any 90-day period for any one shareholder. If
shares are redeemed in kind, the redeeming shareholder might incur brokerage or
other costs in selling the securities for cash. The method of valuing securities
used to make redemptions in kind will be the same as the method the Fund uses to
value its portfolio securities and such valuation will be made as of the time
the redemption price is determined.
CERTAIN WAIVERS OF THE CONTINGENT DEFERRED SALES CHARGE
Any contingent deferred sales charge ("CDSC") which otherwise would be imposed
on redemptions of Fund shares will be waived in certain instances, including (a)
redemptions of shares held at the time a shareholder becomes disabled or dies,
including the shares of a shareholder who owns the shares with his or her spouse
as joint tenants with right of survivorship, provided that the redemption is
requested within one year after the death or initial determination of
disability, (b) redemptions in connection with the following retirement plan
distributions: (i) lump-sum or other distributions from a qualified corporate or
Keogh retirement plan following retirement, termination of employment, death or
disability (or in the case of a five percent owner of the employer maintaining
the plan, following attainment of age 70l/2); (ii) required distributions from
an Individual Retirement Account ("IRA") following the attainment of age 70l/2
or from a custodial account under Section 403(b)(7) of the Internal Revenue Code
of 1986, following the later of retirement or attainment of age 70l/2; and (iii)
a tax-free return of an excess contribution to an IRA, and (c) systematic
withdrawal payments. For purposes of the waiver described in (a) above, a person
will be deemed "disabled" if the person is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to result in death or to be of long-continued
and indefinite duration.
REINSTATEMENT PRIVILEGE
A shareholder who has redeemed shares in the Fund may reinvest all or part of
the redemption proceeds in the Fund without an initial sales charge and receive
a credit for any contingent deferred sales charge paid on the redemption,
provided the reinvestment is made within 30 days after the redemption. This
reinstatement privilege may be exercised only once by a shareholder.
Reinstatement will not alter any capital gains tax payable on the redemption and
a loss may not be allowed for tax purposes.
SYSTEMATIC WITHDRAWAL PLAN
A systematic withdrawal plan (the "Withdrawal Plan") is available to
shareholders who own shares of a Portfolio with a value exceeding $10,000 and
who wish to receive specific amounts of cash periodically. Withdrawals of at
13
<PAGE>
least $50 monthly (but no more than one percent of the value of a shareholder's
shares in the Portfolio) may be made under the Withdrawal Plan by redeeming as
many shares of the Portfolio as may be necessary to cover the stipulated
withdrawal payment. To the extent that withdrawals exceed dividends,
distributions and appreciation of a shareholder's investment in the Portfolio,
there will be a reduction in the value of the shareholder's investment and
continued withdrawal payments may reduce the shareholder's investment and
ultimately exhaust it. Withdrawal payments should not be considered as income
from investment in a Portfolio.
Shareholders who wish to participate in the Withdrawal Plan and who hold their
shares in certificated form must deposit their share certificates of the
Portfolio from which withdrawals will be made with Alger Shareholder Services,
Inc., as agent for Withdrawal Plan members. All dividends and distributions on
shares in the Withdrawal Plan are automatically reinvested at net asset value in
additional shares of the Portfolio involved. For additional information
regarding the Withdrawal Plan, contact the Fund.
EXCHANGES AND CONVERSIONS
IN GENERAL
One class of shares may not be exchanged for another class of shares. Once an
initial sales charge has been imposed on a purchase of Class A Shares, no
additional charge is imposed in connection with their exchange. For example, a
purchase of Alger Money Market Portfolio shares and subsequent exchange to Class
A Shares of Alger Small Capitalization Portfolio, Alger Midcap Portfolio, Alger
Growth Portfolio, Alger Balanced Portfolio or Alger Capital Appreciation
Portfolio (each a "Charge Portfolio") would result in the imposition of an
initial sales charge at the time of exchange; but if the initial purchase had
been of Class A Shares in a Charge Portfolio, an exchange to Class A Shares of
any other Portfolio would not result in an additional initial sales charge. No
CDSC is assessed in connection with exchanges at any time. In addition, no CDSC
is imposed on the redemption of reinvested dividends or capital gains
distributions or on increases in the net asset value of shares of a Portfolio
above purchase payments made with respect to that Portfolio during the six-year
holding period for Class B Shares and the one-year holding period for Class C
Shares and certain Class A Shares.
For purposes of calculating the applicable holding periods for automatic
conversion of Class B (eight years) and Class C (twelve years) Shares to Class A
Shares, shares acquired in an exchange are deemed to have been purchased on the
date on which the shares given in exchange were purchased, provided, however,
that if Class B or Class C Shares are exchanged for shares of Alger Money Market
Portfolio, the period during which the Alger Money Market Portfolio shares are
held will not be included in the holding period for purposes of determining
eligibility for automatic conversion, and the running of the holding period will
recommence only when those shares are reexchanged for shares of the original
class.
FOR SHAREHOLDERS MAINTAINING AN ACTIVE ACCOUNT ON OCTOBER 17, 1992. Shares
acquired in an exchange are deemed to have been purchased on, and continuously
held since, the date on which the shares given in exchange were purchased; thus,
an exchange would not affect the running of any CDSC-related holding period. No
initial sales charge or CDSC would apply to an exchange of shares of a Charge
Portfolio for shares of Alger Money Market Portfolio, but redemptions of shares
of that Portfolio acquired by exchange of shares from one or more of the Charge
Portfolios are subject to any applicable CDSC on the same terms as the shares
given in exchange. If shares of Alger Money Market Portfolio are exchanged for
shares of any of the Charge Portfolios, any later redemptions of those shares
would be subject to any applicable CDSC based on the period of time since the
shares given in exchange were purchased.
The following example illustrates the operation of the CDSC for active accounts
established prior to October 17, 1992. Assume that on the first day of year 1 an
investor purchases $1,000 of shares of each of Alger Money Market Portfolio and
Alger Growth Portfolio, Class B. The shareholder may at any time redeem the
shares of Alger Money Market Portfolio without imposition of the charge. If in
year 3 the shareholder redeems all the Class B Shares of Alger Growth Portfolio
purchased in year 1, a charge of three percent of the current net asset value of
those shares would be imposed on the redemption. The shareholder could redeem
without imposition of the charge any of his or her shares of that Portfolio that
were purchased through reinvestment of dividends and capital gains distributions
as well as an amount of Class B Shares not exceeding any increase in the net
asset value of the $1,000 of shares originally purchased. The shareholder could
also at any time exchange the Class B Shares of Alger Growth Portfolio for Class
B Shares of any other Portfolio without imposition of the charge. If those
shares were later redeemed, however, the redemption would be subject to the
charge based on the current net asset value of the shares and the period of time
since the original purchase payment was made (with adjustments for partial
14
<PAGE>
exchanges and redemptions and any accretions in the shareholder's account by
reason of increases in net asset value and reinvestment of dividends and capital
gains distributions). If the foregoing exchange were made by the shareholder for
additional shares of Alger Money Market Portfolio, any subsequent redemption of
shares of that Portfolio would be deemed to have been made first from the $1,000
of shares of Alger Money Market Portfolio originally purchased in year 1, which
are not subject to the charge, and then from the shares acquired in the
exchange, which are subject to the charge. If instead the shareholder exchanged
the shares of Alger Money Market Portfolio originally purchased in year 1 for
additional Class B Shares of Alger Growth Portfolio (or of the other Charge
Portfolios) any later redemption of those shares would be subject to the charge
in accordance with the foregoing rules based on the period of time since the
original purchase payment was made. Thus, the period of time shares were held in
Alger Money Market Portfolio would be counted toward the six-year holding
period.
FOR NEW SHAREHOLDERS OPENING AN ACCOUNT AFTER OCTOBER 17, 1992. Effective
October 17, 1992, new shareholders of the Fund are subject to the following
terms and conditions regarding the exchange of shares of the Fund's Portfolios.
A CDSC, if any, is assessed on redemptions of Class B and Class C Shares and
certain Class A Shares of the Charge Portfolios and of shares of Alger Money
Market Portfolio that have been acquired in exchange for shares of a Charge
Portfolio, based solely on the period of time the shares are retained in the
Charge Portfolio. Thus, the period of time shares are held in Alger Money Market
Portfolio will not be counted towards the holding period described above in the
calculation of a CDSC.
The following examples illustrate the operation of the CDSC for accounts opened
after October 17, 1992: (1) An investor purchases Class B Shares of Alger Growth
Portfolio on the first day of year 1 and exchanges those shares for shares of
Alger Money Market Portfolio in year 2. No charge is assessed at the time of the
exchange. If in year 4 the shareholder redeems all the shares, a charge of four
percent of the current net asset value of those shares would be imposed on the
redemption based on the period of time the shares were retained in Class B of
the Alger Growth Portfolio. The time period during which the shares of Alger
Money Market Portfolio are held is not included when the amount of the charge is
calculated. The shareholder could redeem without imposition of the charge any of
his shares that were purchased through reinvestment of dividends and capital
gains distributions as well as an amount of shares not exceeding any increase in
the net asset value of the original purchase. (2) An investor purchases shares
of Alger Money Market Portfolio on the first day of year 1 and exchanges those
shares for Class B Shares of Alger Growth Portfolio on the first day of year 2.
No charge is assessed at the time of the exchange. If in year 4 the shareholder
redeems all the shares, a charge of three percent of the current net asset value
of those shares would be imposed on the redemption based on the period of time
the shares were retained in Class B of Alger Growth Portfolio. The time period
during which the shares of Alger Money Market Portfolio are held is not included
when the amount of the charge is calculated. The shareholder could redeem
without imposition of the charge any of his or her shares that were purchased
through reinvestment of dividends and capital gains distributions as well as an
amount of shares not exceeding any increase in the net asset value of the
original purchase.
MANAGEMENT
TRUSTEES AND OFFICERS OF THE FUND
The names of the Trustees and officers of the Fund, together with information
concerning their principal business occupations, are set forth below. Each of
the officers of the Fund is also an officer, and each of the Trustees is also a
director or trustee, as the case may be, of Castle Convertible Fund, Inc., a
registered closed-end investment company, and of The Alger American Fund, The
Alger Retirement Fund and Spectra Fund, registered open-end management
investment companies, for all of which Alger Management serves as investment
adviser. Fred M. Alger III and David D. Alger are "interested persons" of the
Fund, as defined in the Act. Fred M. Alger III and David D. Alger are brothers.
Unless otherwise noted, the address of each person named below is 75 Maiden
Lane, New York, New York 10038.
15
<PAGE>
<TABLE>
<CAPTION>
Name, Age and Position with
the Fund and Address Principal Occupations
<S> <C>
Fred M. Alger III (62) Chairman of the Boards of Alger Associates, Inc.
Chairman of the Board ("Associates"), Alger Inc., Alger Management, Alger Properties, Inc.
("Properties"), Alger Shareholder Services, Inc. ("Services"), Alger Life Insurance Agency,
Inc. ("Agency"), Analysts Resources, Inc. ("ARI"),
The Alger American Asset Growth Fund ("Asset Growth") and Fred Alger International Advisory
S. A. ("International").
David D. Alger (53) President and Director of Associates, Alger Management, Alger Inc.,
President and Trustee Properties, Services, International and Agency; Executive Vice President and Director of ARI.
Gregory S. Duch (46) Executive Vice President, Treasurer and Director of Alger
Treasurer Management and Properties; Executive Vice President and Treasurer of Associates, Alger Inc.,
ARI, Services and Agency; Treasurer and Director
of International.
Mary E. Marsden-Cochran (44) General Counsel and Secretary, Associates, Alger Management, Alger Inc.,
Secretary Properties, ARI, Services, and Agency (2/96-present); Secretary of International
(7/96-present); Associate General Counsel and Vice President, Smith Barney Inc. (12/94-2/96);
Blue Sky Attorney, AMT Capital (1/94-11/94).
Frederick A. Blum (43) Senior Vice President of Associates, Alger Management, Alger Inc.,
Assistant Secretary Properties, ARI, Services and Agency.
and Assistant Treasurer
Arthur M. Dubow (64) Private investor since 1985; Director of Coolidge Investment Corporation;
Trustee formerly Chairman of the Board of Institutional Shareholder Services, Inc.
P.O. Box 969 and President of Fourth Estate, Inc.
Wainscott, NY 11975
Stephen E. O'Neil (65) Of Counsel to the law firm of Kohler & Barnes P.C.;
Trustee Private investor since 1981; Director of NovaCare, Inc. and
460 Park Avenue Brown-Forman Corporation; formerly President and Vice Chairman
New York, NY 10022 of City Investing Company and Director of Centerre Bancorporation
and Syntro Corporation.
Nathan E. Saint-Amand, M.D. (59) Medical doctor in private practice.
Trustee
2 East 88th Street
New York, NY 10128
John T. Sargent (72) Private investor since 1987; Director of Atlantic Mutual Insurance Co.;
Trustee formerly Director of River Bank America.
14 E. 69th Street
New York, NY 10021
</TABLE>
No director, officer or employee of Alger Management or its affiliates will
receive any compensation from the Fund for serving as an officer or Trustee of
the Fund. The Fund pays each Trustee who is not a director, officer or employee
of Alger Management or its affiliates (a "Disinterested Trustee") a quarterly
fee of $2,000, which is reduced by the proportion of the meetings not attended
by the Trustee during the quarter.
The Fund did not offer its Trustees any pension or retirement benefits during or
prior to the fiscal year ended October 31, 1996. The following table provides
compensation amounts paid to Disinterested Trustees of the Fund for the fiscal
year ended October 31, 1996.
16
<PAGE>
COMPENSATION TABLE
<TABLE>
<CAPTION>
Total Compensation Paid to Trustees from
The Alger Retirement Fund,
Aggregate The Alger Fund,
Compensation The Alger American Fund,
from Castle Convertible Fund, Inc. and
Name of Person, Position The Alger Fund Spectra Fund
- ------------------------ ---------------- ---------------------------------------
<S> <C> <C>
Arthur M. Dubow, Trustee $8,000 $28,250
Stephen E. O'Neil, Trustee $8,000 $28,250
Nathan E. Saint-Amand, Trustee $8,000 $28,250
John T. Sargent, Trustee $8,000 $28,250
</TABLE>
INVESTMENT MANAGER
Alger Management serves as investment manager to each of the Portfolios pursuant
to separate written agreements (the "Management Agreements"). Certain of the
services provided by, and the fees paid by the Portfolios to, Alger Management
under the Management Agreements are described in the Prospectus. Alger
Management pays the salaries of all officers who are employed by it . Alger
Management has agreed to maintain office facilities for the Fund, furnish the
Fund with statistical and research data, clerical, accounting and bookkeeping
services, and certain other services required by the Fund, and to compute the
net asset values, net income and realized capital gains or losses of the
Portfolios. Alger Management prepares semi-annual reports to the SEC and to
shareholders, prepares federal and state tax returns and filings with state
securities commissions, maintains the Fund's financial accounts and records and
generally assists in all aspects of the Fund's operations. Alger Management
bears all expenses in connection with the performance of its services under the
Management Agreements.
Each Management Agreement provides that if, in any fiscal year, the aggregate
expenses of the Portfolio (exclusive of certain specified categories of expense)
exceed the expense limitation of any state having jurisdiction over the
Portfolio, Alger Management will reimburse the Portfolio for that excess expense
to the extent required by state law. At the date of this Statement of Additional
Information, there is no state expense limitation applicable to any Portfolio.
During the fiscal years ended October 31, 1994, 1995, and 1996, Alger Management
earned under the terms of the Management Agreements $711,113, $830,000, and
$1,214,904 respectively, in respect of the Alger Money Market Portfolio;
$2,359,000, $3,118,000, and $4,478,467 respectively, in respect of the Alger
Small Capitalization Portfolio; $444,000, $760,000, and $1,654,488 respectively,
in respect of the Alger Growth Portfolio; $26,000, $27,000, and $82,116
respectively, in respect of the Alger Balanced Portfolio; $92,000, $244,000, and
$720,696 respectively, in respect of the Alger MidCap Growth Portfolio; and
$17,000, $77,000, and $861,617 respectively, in respect of the Alger Capital
Appreciation Portfolio. Some of these fees, however, were offset in whole or in
part by various expense reimbursements and waivers. The expense reimbursements
and waivers for the fiscal year ended October 31, 1996 are described in the
Notes to the Fund's Financial Statements for that period. See, "Financial
Statements" below.
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP serves as independent public accountant for the Fund.
TAXES
The following is a summary of selected federal income tax considerations that
may affect the Fund and its shareholders. The summary is not intended to
substitute for individual tax advice and investors are urged to consult their
own tax advisers as to the federal, state and local tax consequences of
investing in the Fund.
Each Portfolio intends to qualify as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). If
qualified as a regulated investment company, a Portfolio will pay no federal
income taxes on its taxable net investment income (that is, taxable income other
than net realized capital gains) and its net realized capital gains that are
distributed to shareholders. To qualify under Subchapter M, a Portfolio must,
among other things: (1) distribute to its shareholders at least 90% of its
taxable net investment income and net realized short-term capital gains; (2)
derive at least 90% of its gross income from dividends, interest, payments with
respect to loans of securities, gains from the sale or other disposition of
securities, or other income (including, but not limited to, gains from options,
futures and forward contracts) derived with respect to the Portfolio's business
of investing in securities; (3) derive less than 30% of its annual gross income
from the sale or other disposition of securities, options, futures or forward
contracts held for less than three months; and (4) diversify its holdings so
17
<PAGE>
that, at the end of each fiscal quarter of the Portfolio (a) at least 50% of the
market value of the Portfolio's assets is represented by cash, U.S. Government
securities and other securities, with those other securities limited, with
respect to any one issuer, to an amount no greater in value than 5% of the
Portfolio's total assets and to not more than 10% of the outstanding voting
securities of the issuer, and (b) not more than 25% of the market value of the
Portfolio's assets is invested in the securities of any one issuer (other than
U.S. Government securities or securities of other regulated investment
companies) or of two or more issuers that the Portfolio controls and that are
determined to be in the same or similar trades or businesses or related trades
or businesses. In meeting these requirements, a Portfolio may be restricted in
the selling of securities held by the Portfolio for less than three months and
in the utilization of certain of the investment techniques described above and
in the Fund's prospectus. As a regulated investment company, each Portfolio is
subject to a non-deductible excise tax of 4% with respect to certain
undistributed amounts of income and capital gains during the calendar year. The
Fund expects each Portfolio to make additional distributions or change the
timing of its distributions so as to avoid the application of this tax. Although
the Fund expects each Portfolio to make such distributions as are necessary to
avoid the application of this tax, certain of such distributions, if made in
January, might be included in the taxable income of shareholders in the year
ended in the previous December.
Payments reflecting the dividend income of the Portfolios will not qualify for
the dividends-received deduction for corporations if the Portfolio sells the
underlying stock before satisfying a 46-day holding period requirement (91 days
for certain preferred stock). Dividends-received deductions will be allowed to a
corporate shareholder only if similar holding period requirements with respect
to shares of the Portfolio have been met.
In general, any gain or loss on the redemption or exchange of Portfolio shares
will be long-term capital gain or loss if held by the shareholder for more than
one year, and will be short-term capital gain or loss if held for one year or
less. However, if a shareholder receives a distribution taxable as long-term
capital gain with respect to Portfolio shares, and redeems or exchanges the
shares before holding them for more than six months, any loss on the redemption
or exchange up to the amount of the distribution will be treated as a long-term
capital loss.
Dividends of a Portfolio's net investment income and distributions of its
short-term capital gains will be taxable as ordinary income. Distributions of
long-term capital gains will be taxable as such at the appropriate rate,
regardless of the length of time you have held shares of the Portfolio. If you
receive a distribution treated as long-term capital gain with respect to Fund
shares, and you redeem or exchange the shares before holding them for more than
six months, any loss on the redemption or exchange up to the amount of the
distribution will be treated as long-term capital loss. Only dividends that
reflect a Portfolio's income from certain dividend-paying stocks will be
eligible for the federal dividends-received deduction for corporate
shareholders. None of the dividends paid by the Alger Money Market Portfolio
will be eligible for the dividends-received deduction.
If a Portfolio is the holder of record of any stock on the record date for any
dividends payable with respect to such stock, such dividends are included in the
Portfolio's gross income as of the later of (a) the date such stock became
ex-dividend with respect to such dividends (i.e., the date on which a buyer of
the stock would not be entitled to receive the declared, but unpaid, dividends)
or (b) the date the Portfolio acquired such stock. Accordingly, in order to
satisfy its income distribution requirements, a Portfolio may be required to pay
dividends based on anticipated earnings and shareholders may receive dividends
in an earlier year than would otherwise be the case.
Investors considering buying shares of a Portfolio just prior to a record date
for a taxable dividend or capital gain distribution should be aware that,
regardless of whether the price of the Portfolio shares to be purchased reflects
the amount of the forthcoming dividend or distribution payment, any such payment
will be a taxable dividend or distribution payment.
If a shareholder fails to furnish a correct taxpayer identification number,
fails to fully report dividend or interest income, or fails to certify that he
or she has provided a correct taxpayer identification number and that he or she
is not subject to such withholding, then the shareholder may be subject to a 31
percent "backup withholding tax" with respect to (i) any taxable dividends and
distributions and (ii) any proceeds of any redemption of Fund shares. An
individual's taxpayer identification number is his or her social security
number. The 31 percent backup withholding tax is not an additional tax and may
be credited against a shareholder's regular federal income tax liability.
18
<PAGE>
CUSTODIAN AND TRANSFER AGENT
State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts
02110 serves as custodian for the Fund pursuant to a custodian agreement under
which it holds the Portfolios' assets. Alger Shareholder Services, Inc., 30
Montgomery Street, Jersey City, New Jersey 07302, serves as transfer agent for
the Fund pursuant to a transfer agency agreement. Under the transfer agency
agreement Alger Shareholder Services, Inc. processes purchases and redemptions
of shares of the Fund, maintains the shareholder account records for each
Portfolio, handles certain communications between shareholders and the Fund and
distributes any dividends and distributions payable by the Fund.
CERTAIN SHAREHOLDERS
Set forth below is certain information regarding significant shareholders of the
Portfolios.
The following table contains information regarding persons who own of record, or
are known to own beneficially, five percent or more of the shares of any
Portfolio. Unless otherwise noted, the address of each owner is 75 Maiden Lane,
New York, New York 10038. All holdings are expressed as a percentage of a
Portfolio's outstanding shares as of May 20, 1997 and record and beneficial
holdings are in each instance denoted as follows: record/beneficial. Class C
Shares were not available on May 20, 1997.
- --------------------------------------------------------------------------------
ALGER BALANCED PORTFOLIO - CLASS A (RECORD/BENEFICIAL)
NFSC FBO 12.69%/12.69%
L. McLaren
119 Normandy Lane
Oak Ridge, TN 37830
M. Richardson 11.17%/11.17%
24441 Calle Sonora
Laguna Hills, CA 92653
J. Richardson 23.04%/23.04%
24441 Calle Sonora
Laguna Hills, CA 92653
Raymond James & Assoc. Inc. 5.69%/5.69%
FAO J. Fox
937 Heritage Dr.
Gettysburg, PA 17325
NFSC FBO 7.38%/7.38%
H.C. McCurdy
796 W. Outer Dr.
Oak Ridge, TN 37830
Charles Schwab & Co., Inc. 22.04%/*
Special Custody Acct.
101 Montgomery St.
San Francisco, CA 94104
ALGER BALANCED PORTFOLIO - CLASS B (RECORD/BENEFICIAL)
D. Hurry 5.02%/5.02%
10 Atoll Dr.
Corona del Mar, CA 92625
ALGER SMALL CAPITALIZATION PORTFOLIO -
CLASS A (RECORD/BENEFICIAL)
Charles Schwab & Co., Inc. 29.69%/*
Special Custody Acct.
101 Montgomery St.
San Francisco, CA 94104
Halpern Crane Partnership 9.95%/*
1300 W. Belmont
Chicago, IL 60657
ALGER MIDCAP GROWTH PORTFOLIO - CLASS A (RECORD/BENEFICIAL)
Charles Schwab & Co., Inc. 53.69%/*
Special Custody Acct.
101 Montgomery St.
San Francisco, CA 94104
Farash Investments, LLC 5.34%/*
P.O. Box 2969
Saratoga, CA 95070
ALGER GROWTH PORTFOLIO - CLASS A (RECORD/BENEFICIAL)
Charles Schwab & Co., Inc. 18.45%/*
Special Custody Acct.
101 Montgomery St.
San Francisco, CA 94104
Best & Co. 66.55%/*
Dreyfus Retirement Svcs.
1 Cabot Rd. AIM 028-003I
Medford, MA 02155
ALGER CAPITAL APPRECIATION PORTFOLIO -
CLASS A (RECORD/BENEFICIAL)
Charles Schwab & Co., Inc. 35.29%/*
Special Custody Acct.
101 Montgomery St.
San Francisco, CA 94104
Merrill Lynch Trust Co. 8.23%/*
T'tee FBO
Qualified Retirement Plans
265 Davidson Avenue
Somerset, NJ 08873
J.C. Bradford & Co. Cust. FBO 18.31%/*
Appel Equity Group
330 Commerce St.
Nashville, TN 37201
* Indicates shareholder owns less than 5% of the Portfolio's shares.
On May 20, 1997 the Fund's officers & Trustees as a group did not hold 1% or
more of any portfolio or class of the Fund.
19
<PAGE>
ORGANIZATION
The Fund has been organized as an unincorporated business trust under the laws
of the Commonwealth of Massachusetts pursuant to an Agreement and Declaration of
Trust dated March 20, 1986 (the "Trust Agreement"). Alger Money Market
Portfolio, Alger Small Capitalization Portfolio and Alger Growth Portfolio
commenced operations on November 11, 1986. Alger Balanced Portfolio commenced
operations on June 1, 1992, Alger MidCap Growth Portfolio commenced operations
on May 24, 1993 and Alger Capital Appreciation Portfolio commenced operations on
November 1, 1993. Prior to March 27, 1995 Alger Capital Appreciation Portfolio
was known as Alger Leveraged AllCap Portfolio. The word "Alger" in the Fund's
name has been adopted pursuant to a provision contained in the Trust Agreement.
Under that provision, Alger Management may terminate the Fund's license to use
the word "Alger" in its name when Alger Management ceases to act as the Fund's
investment manager. On December 31, 1996, Class A Shares were added to all
portfolios of the Fund except Alger Money Market Portfolio. Class A shares have
a front-end sales charge. The previously existing shares in those portfolios,
subject to a CDSC, were designated Class B Shares on that date. Class C Shares,
which are subject to a CDSC, were created on August 1 , 1997.
Shares of each Portfolio other than Alger Money Market Portfolio are thus
divided into three classes, Class A, Class B and Class C. The classes differ in
that: (a) each class has a different class designation; (b) only the Class A
Shares are subject to a front-end sales charge ("FESC"); (c) only the Class B
and Class C Shares are subject to CDSCs, and certain Class A Shares may also be
subject to a CDSC; (d) only the Class B and Class C Shares (as described below)
are subject to distribution fees under plans adopted pursuant to Rule 12b-1
under the 1940 Act (each, a "Rule 12b-1 Plan"); (e) to the extent that one class
alone is affected by a matter submitted to a vote of the shareholders, then only
that class has voting power on the matter; and (f) the exchange privileges and
conversion rights of each class differ from those of the others.
Shares do not have cumulative voting rights, which means that holders of more
than 50 percent of the shares voting for the election of Trustees can elect all
Trustees. Shares are transferable but have no preemptive, conversion or
subscription rights. Shareholders generally vote by Portfolio, except with
respect to the election of Trustees and the ratification of the selection of
independent accountants, and by class within a Portfolio on matters in which the
interests of one class differ from those of another; see also item (e) in the
preceding paragraph. In the interest of economy and convenience, certificates
representing shares of a Portfolio are physically issued only upon specific
written request of a shareholder.
Meetings of shareholders notmally will not be held for the purpose of electing
Trustees unless and until such time as less than a majority of the Trustees
holding office have been elected by shareholders, at which time the Trustees
then in office will call a shareholders' meeting for the election of Trustees.
Under the Act, shareholders of record of no less than two-thirds of the
outstanding shares of the Fund may remove a Trustee through a declaration in
writing or by vote cast in person or by proxy at a meeting called for that
purpose. Under the Trust Agreement, the Trustees are required to call a meeting
of shareholders for the purpose of voting on the question of removal of any such
Trustee when requested in writing to do so by the shareholders of record of not
less than 10 percent of the Fund's outstanding shares.
Massachusetts law provides that shareholders could, under certain circumstances,
be held personally liable for the obligations of the Fund. However, the Trust
Agreement disclaims shareholder liability for acts or obligations of the Fund
and requires that notice of such disclaimer be given in each agreement,
obligation or instrument entered into or executed by the Fund or a Trustee. The
Trust Agreement provides for indemnification from the Fund's property for all
losses and expenses of any shareholder held personally liable for the
obligations of the Fund. Thus, the risk of a shareholder's incurring financial
loss on account of shareholder liability is limited to circumstances in which
the Fund itself would be unable to meet its obligations, a possibility that the
Fund believes is remote. Upon payment of any liability incurred by the Fund, the
shareholder paying the liability will be entitled to reimbursement from the
general assets of the Fund. The Trustees intend to conduct the operations of the
Fund in a manner so as to avoid, as far as possible, ultimate liability of the
shareholders for liabilities of the Fund.
DETERMINATION OF PERFORMANCE
MONEY MARKET PORTFOLIO
The Alger Money Market Portfolio's "yield" and "effective yield" referred to in
the Prospectus are calculated according to formulas prescribed by the SEC. The
Portfolio's seven-day "yield" is computed by determining the net change,
20
<PAGE>
exclusive of capital changes, in the value of a hypothetical pre-existing
account in the Portfolio having a balance of one share at the beginning of the
period, dividing the net change in account value by the value of the account at
the beginning of the base period to obtain the base period return, and then
multiplying the base period return by (365/7). The Portfolio's "effective yield"
is computed by compounding the unannualized base period return (calculated as
above), by adding one to it, raising the sum to a power equal to 365 divided by
seven, and subtracting one from the result. When Alger Money Market Portfolio
includes quotations of "yield" and "effective yield" that are based on the
income generated by an investment in the Portfolio over a thirty-day, or one
month, period, it will calculate the "yield" and "effective yield" in the manner
described above except that, in annualizing the "yield" and "effective yield,"
the formula will be adjusted to reflect the proper period.
For the seven-day period ended April 30, 1997, the annualized yield was 4.84%,
and the compounded effective yield was 4.96%.
OTHER PORTFOLIOS
The "total return" and "yield" referred to in the Prospectus as to each of the
Classes of the Portfolios, other than Alger Money Market Portfolio, are also
computed according to formulas prescribed by the SEC. These performance figures
are calculated in the following
manner:
A.Total Return--A Class' average annual total return described in the Prospectus
is computed according to the following formula:
P (1+T)n=ERV
Where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the 1, 5, or 10 year periods at the end of
the 1, 5 and 10 year periods (or fractional portion thereof);
The average annual total returns for Classes A and B of the Portfolios, other
than Alger Money Market Port-folio, for the periods indicated below were as
follows:
(Class B)
(Class B) Period (Class B)
(Class A) (Class B) Five from Ten
Period Year Years Inception Years
Ended Ended Ended through Ended
4/30/97 4/30/97 4/30/97 4/30/97 4/30/97
------- ------- ------- ------- -------
Alger Small Capitalization
Portfolio*--Class A++ (16.23%) n/a n/a n/a n/a
--Class B n/a (21.07%) 12.06% n/a 14.54%
Alger Growth Portfolio*
--Class A++ (1.81%) n/a n/a n/a n/a
--Class B n/a 1.75% 17.22% n/a 13.91%
Alger Balanced Portfolio**
--Class A++ (2.16%) n/a n/a n/a n/a
--Class B n/a (0.72%) n/a 8.46% n/a
Alger MidCap Growth
Portfolio***--Class A++ (8.98%) n/a n/a n/a n/a
--Class B n/a (9.65%) n/a 19.28% n/a
Alger Capital Appreciation
Portfolio+ --Class A++ (4.31%) n/a n/a n/a n/a
--Class B n/a (6.92%) n/a 25.61 n/a
* Commenced operations on November 11, 1986.
** Commenced operations on June 1, 1992.
*** Commenced operations on May 24, 1993.
+ Commenced operations on November 1, 1993.
++ Initially offered January 1, 1997.
B. Yield--a Class's net annualized yield described in the Prospectus is computed
according to the following formula:
YIELD = 2[((a-b)/(cd) + 1)^6 - 1]
Where: a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursements).
c = The average daily number of shares outstanding during the period
that were entitled to receive dividends.
d = the maximum offering price per share on the last day of the period.
IN GENERAL
Current performance information for the Classes of the Portfolios may be
obtained by calling the Fund at (800) 992-3863. Quoted performance may not be
indicative of future performance. The performance of a Class will depend upon
factors such as its expenses and the types and maturities of securities held by
the Portfolio.
21
<PAGE>
From time to time, advertisements or reports to shareholders may compare the
yield or performance of a Portfolio with that of other mutual funds with a
similar investment objective. The yield of the Alger Money Market Portfolio
might be compared with, for example, averages compiled by IBC/DONOGHUE'S MONEY
FUND REPORT, a widely recognized, independent publication that monitors the
performance of money market mutual funds. The yield of the Alger Money Market
Portfolio might also be compared with the average yield reported by the Bank
Rate Monitor for money market deposit accounts offered by the 50 leading banks
and thrift institutions in the top five standard metropolitan areas. Similarly,
the performance of the other Portfolios, for example, might be compared with
rankings prepared by Lipper Analytical Services Inc., which is a widely
recognized, independent service that monitors the performance of mutual funds,
as well as with various unmanaged indices, such as the S&P 500 Index, the
Russell 2000 Growth Index, the S&P SmallCap 600 Index, the Wilshire Small
Company Growth Index, the Lehman Government/Corporate Bond Index or the S&P
MidCap 400 Index. In addition, evaluations of the Portfolios published by
nationally recognized ranking services or articles regarding performance,
rankings and other Portfolio characteristics may appear in national publications
including, but not limited to, BARRON'S, BUSINESS WEEK, FORBES, INSTITUTIONAL
INVESTOR, INVESTOR'S BUSINESS DAILY, KIPLINGER'S PERSONAL FINANCE, MONEY,
MORNINGSTAR, THE NEW YORK TIMES, USA TODAY and THE WALL STREET JOURNAL and may
be included in advertisements or communications to shareholders. Any given
performance comparison should not be considered as representative of such
Portfolio's performance for any future period.
FINANCIAL STATEMENTS
The Fund's audited financial statements for the year ended October 31, 1996,
which are contained in the Annual Report to Shareholders for that fiscal year,
and the Fund's unaudited financial statements for the six months ended April 30,
1997, which are contained in the Semi-Annual Report for that period, are hereby
incorporated by reference and copies may be obtained by telephoning (800)
992-3863.
22
<PAGE>
APPENDIX
Description of the highest commercial paper, bond and other short and long
term rating categories assigned by Standard & Poor's Corporation ("S&P"),
Moody's Investors Service, Inc. ("Moody's"), "Fitch" Investors Service, Inc.
("Fitch") and Duff and Phelps, Inc.
("Duff").
COMMERCIAL PAPER AND SHORT-TERM RATINGS
The designation A-l by S&P indicates that the degree of safety reading
timely payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted with a plus sign (+)
designation. Capacity for timely payment on issues with an A-2 designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-l.
The rating Prime-l (P-l) is the highest commercial paper rating assigned by
Moody's. Issuers of P-l paper must have a superior capacity for repayment of
short term promissory obligations and ordinarily will be evidenced by leading
market positions in well established industries, high rates of return of funds
employed, conservative capitalization structures with moderate reliance on debt
and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established access
to a range of financial markets and assured sources of alternate liquidity.
Issues rated Prime-2 (P-2) have a strong capacity for repayment of short-term
promissory obligations. This ordinarily will be evidenced by many of the
characteristics cited above but to a lesser degree Earnings trends and coverage
ratios, while sound, will be more subject to variation. Capitalization
characteristics, while still appropriate, may be more affected by external
conditions. Ample alternate liquidity is maintained.
The rating Fitch-l (Highest Grade) is the highest commercial paper rating
assigned by Fitch. Paper rated Fitch-l is regarded as having the strongest
degree of assurance for timely payment. The rating Fitch-2 (Very Good Grade) is
the second highest commercial paper rating assigned by Fitch which reflects an
assurance of timely payment only slightly less in degree than the strongest
issues.
The rating Duff-l is the highest commercial paper rating assigned by Duff.
Paper rated Duff-l is regarded as having very high certainty of timely payment
with excellent liquidity factors which are supported by ample asset protection.
Risk factors are minor. Paper rated Duff-2 is regarded as having good certainty
of timely payment, good access to capital markets and sound liquidity factors
and company fundamentals. Risk factors are small.
BOND AND LONG-TERM RATINGS
Bonds rated AA by S&P are judged by S&P to be high-grade obligations and in
the majority of instances differ only in small degree from issues rated AAA
(S&P's highest rating). Bonds rated AAA are considered by S&P to be the highest
grade obligations and possess the ultimate degree of protection as to principal
and interest. With AA bonds, as with AAA bonds, prices move with the long-term
money market. Bonds rated A by S&P have a strong capacity to pay principal and
interest, although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions.
S&P's BBB rated bonds, or medium-grade category bonds, are borderline
between definitely sound obligations and those where the speculative elements
begin to predominate. These bonds have adequate asset coverage and normally are
protected by satisfactory earnings. Their susceptibility to changing conditions,
particularly to depressions, necessitates constant watching. These bonds
generally are more responsive to business and trade conditions than to interest
rates. This group is the lowest that qualifies for commercial bank investment.
Bonds rated Aa by Moody's are judged to be of high quality by all standards.
Together with bonds rated Aaa (Moody's highest rating) they comprise what are
generally known as high-grade bonds. Aa bonds are rated lower than Aaa bonds
because margins of protection may not be as large as those of Aaa bonds, or
fluctuation of protective elements may be of greater amplitude, or there may be
other elements present that make the long-term risks appear somewhat larger than
those applicable to Aaa securities. Bonds that are
A-1
<PAGE>
APPENDIX
(continued)
rated A by Moody's 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 that
suggest a susceptibility to impairment in the future.
Moody's Baa rated bonds 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.
Moody's applies the numerical modifiers 1, 2 and 3 to each generic rating
classification from Aa through B. The modifier 1 indicates that the security
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates that the issue ranks in the
lower end of its generic rating category.
Bonds rated AAA by Fitch are judged by Fitch to be strictly high grade,
broadly marketable, suitable for investment by trustees and fiduciary
institutions and liable to but slight market fluctuation other than through
changes in the money rate. The prime feature of an AAA bond is a showing of
earnings several times or many times interest requirements, with such stability
of applicable earnings that safety is beyond reasonable question whatever
changes occur in conditions. Bonds rated AA by Fitch are judged by Fitch to be
of safety virtually beyond question and are readily salable, whose merits are
not unlike those of the AAA class, but whose margin of safety is less strikingly
broad. The issue may be the obligation of a small company, strongly secured but
influenced as to rating by the lesser financial power of the enterprise and more
local type of market.
Bonds rated Duff-l are judged by Duff to be of the highest credit quality
with negligible risk factors; only slightly more than U.S. Treasury debt. Bonds
rated Duff-2, 3 and 4 are judged by Duff to be of high credit quality with
strong protection factors. Risk is modest but may vary slightly from time to
time because of economic conditions.
A-2
<PAGE>
INVESTMENT MANAGER:
Fred Alger Management, Inc.
75 Maiden Lane
New York, New York 10038
- --------------------------------------------------------------------------------
DISTRIBUTOR:
Fred Alger & Company, Incorporated
30 Montgomery Street
Jersey City, New Jersey 07302
- --------------------------------------------------------------------------------
TRANSFER AGENT:
Alger Shareholder Services, Inc.
30 Montgomery Street
Box 2001
Jersey City, New Jersey 07302
- --------------------------------------------------------------------------------
INDEPENDENT PUBLIC ACCOUNTANTS:
Arthur Andersen LLP
1345 Avenue of the Americas
New York, New York 10105
- --------------------------------------------------------------------------------
COUNSEL:
Hollyer Brady Smith Troxell
Barrett Rockett Hines & Mone LLP
551 Fifth Avenue
New York, NY 10176
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
(1) Financial Statements included in Part A:
Condensed Financial Information
(2) Financial Statements incorporated in Part B by reference to
the Annual Report to Shareholders for the fiscal year ended
October 31, 1996:
(i) Report of Independent Accountants;
(ii) Financial Statements as of October 31, 1996 and for
the period then ended.
(3) Financial Statements incorporated in Part B by reference to
the Semi-Annual Report to Shareholders for the six months
ended April 30, 1997:
(i) Schedule of Investments (all Portfolios)
(ii) Financial Highlights (all Portfolios)
(iii) Statements of Assets and Liabilities
(iv) Statements of Operations
(v) Statement of Cash Flows (Alger Capital Appreciation
Portfolio)
(vi) Statements of Changes in Net Assets
(vii) Notes to Financial Statements
(b) Exhibits:
Exhibit No. Description of Exhibit
----------- ----------------------
1(a) Agreement and Declaration of Trust. EDGAR 6/2/97 (1)
1(b) Certificate of Designation relating to Alger High Yield
Portfolio. EDGAR 6/2/97 (3)
1(c) Certificate of Designation relating to Alger Income and
Growth Portfolio. EDGAR 6/2/97 (3)
1(d) Certificate of Designation relating to Alger Balanced
Portfolio. EDGAR 6/2/97 (8)
1(e) Certificate of Designation relating to Alger MidCap Growth
Portfolio. EDGAR 6/2/97 (9)
1(f) Certificate of Designation relating to Alger Leveraged AllCap
Portfolio. EDGAR 6/2/97 (10)
1(g) Certificate of Amendment relating to Alger Capital Appreciation
Portfolio. EDGAR 6/2/97
1(h) Certificate of Termination relating to Alger Income and Growth
Portfolio. EDGAR 6/2/97
1(i) Certificate of Amendment relating to the creation of Class A
Shares. (12)
2 By-laws of Registrant. EDGAR 6/2/97 (1)
4 Specimen Share Certificates. EDGAR 6/2/97 (3) (8) (9) (10)
<PAGE>
Exhibit No. Description of Exhibit
----------- ----------------------
4(a)(i) Specimen Share Certificate for Alger Balanced Portfolio -
Class A
4(a)(ii) Specimen Share Certificate for Alger Balanced Portfolio -
Class B
4(a)(iii) Specimen Share Certificate for Alger Balanced Portfolio -
Class C
4(b)(i) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class A
4(b)(ii) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class B
4(b)(iii) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class C
4(c)(i) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class A
4(c)(ii) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class B
4(c)(iii) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class C
4(d)(i) Specimen Share Certificate for Alger Growth Portfolio -
Class A
4(d)(ii) Specimen Share Certificate for Alger Growth Portfolio -
Class B
4(d)(iii) Specimen Share Certificate for Alger Growth Portfolio -
Class C
4(e)(i) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class A
4(e)(ii) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class B
4(e)(iii) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class C
5 Investment Management Agreements. EDGAR 6/2/97 (6)
5(a) Investment Management Agreement for Alger Balanced
Portfolio (8)
5(b) Investment Management Agreement for Alger MidCap Growth
Portfolio (9)
5(c) Investment Management Agreement for Alger Leveraged AllCap
Portfolio (11)
5(d) Investment Management Agreement for Alger Small Capitalization
Portfolio.
5(e) Investment Management Agreement for Alger Money Market Portfolio
5(f) Investment Management Agreement for Alger Growth Portfolio
6(a) Distribution Agreement EDGAR 6/2/97 (6)
6(a)(ii) Amendment to Distribution Agreement. [Form of]
6(b) Selected Dealer and Shareholder Servicing Agreement
EDGAR 6/2/97 (4)
8 Custody Agreement EDGAR 6/2/97
10(a) Opinion and Consent of Sullivan & Worcester
10(b) Opinion and Consent of Hollyer Brady Smith Troxell
Barrett Rockett Hines & Mone LLP
11 Consent of Arthur Andersen LLP
13 Form of Subscription Agreement EDGAR 6/2/97 (2)
13(a) Purchase Agreement for Alger Balanced Portfolio
EDGAR 6/2/97 (8)
13(b) Purchase Agreement for Alger MidCap Growth Portfolio
EDGAR 6/2/97 (9)
13(c) Purchase Agreement for Alger Leveraged AllCap Portfolio
EDGAR 6/2/97 (11)
13(d) Purchase Agreement for Alger Small Capitalization Portfolio
EDGAR 6/2/97 (Form of)
13(e) Purchase Agreement for Alger Growth Portfolio
EDGAR 6/2/97 (Form of)
14 Retirement Plans (5)
<PAGE>
Exhibit No. Description of Exhibit
----------- ----------------------
15 Plan of Distribution EDGAR 6/2/97 (2)
15(b) Plan of Distribution for Class C Shares of The Alger Fund.
[Form of]
16 Schedule for computation of performance quotations provided in
the Statement of Additional Information
19(a) Rule 18f-3 Plan for Alger Balanced Portfolio - Class C. [Form of]
19(b) Rule 18f-3 Plan for Alger MidCap Growth Portfolio - Class C.
[Form of]
19(c) Rule 18f-3 Plan for Alger Capital Appreciation Portfolio - Class
C. [Form of]
19(d) Rule 18f-3 Plan for Alger Growth Portfolio - Class C. [Form of]
19(e) Rule 18f-3 Plan for Alger Small Capitalization Portfolio - Class
C. [Form of]
- ----------
(1) Incorporated by reference to Registrant's Registration Statement (the
"Registration Statement") filed with the Securities and Exchange Commission
(the "SEC") on April 18, 1986.
(2) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registration Statement filed with the SEC on October 14, 1986.
(3) Incorporated by reference to Pre-Effective Amendment No. 2 to the
Registration Statement filed with the SEC on November 3, 1986.
("Pre-Effective Amendment No. 2").
(4) Incorporated by reference to Post-Effective Amendment No. 1 to the
Registration Statement filed with the SEC on May 7, 1987.
(5) Incorporated by reference to Exhibit No. 12 to Pre-Effective Amendment No.
2.
(6) Incorporated by reference to Post-Effective Amendment No. 4 filed with the
SEC on February 28, 1989.
(7) Incorporated by reference to Post-Effective Amendment No. 5 filed with the
SEC on February 2, 1990.
(8) Incorporated by reference to Post-Effective Amendment No. 8 filed with the
SEC on April 3, 1992.
(9) Incorporated by reference to Post-Effective Amendment No. 10 filed with the
SEC on March 24, 1993.
(10) Incorporated by reference to Post-Effective Amendment No. 11 filed with the
SEC on August 31, 1993.
(11) Incorporated by reference to Post-Effective Amendment No. 12 filed with the
SEC on October 29, 1993.
(12) Incorporated by reference to Post-Effective Amendment No. 22 filed with the
SEC on December 20, 1996.
<PAGE>
Item 25. Persons Controlled by or Under Common Control with Registrant
None.
Item 26. Number of Holders of Securities
Set forth below is information regarding the number of record holders of
each class of Registrant's securities as of May 12, 1997.
Title or Class Number of Record Holders
-------------- ------------------------
Alger Money Market Portfolio 22,273
Alger Small Capitalization Portfolio - Class A 600
Alger Small Capitalization Portfolio - Class B 51,485
Alger Growth Portfolio - Class A 501
Alger Growth Portfolio - Class B 29,125
Alger Balanced Portfolio - Class A 35
Alger Balanced Portfolio - Class B 2,700
Alger Midcap Growth Portfolio - Class A 263
Alger Midcap Growth Portfolio - Class B 18,488
Alger Capital Appreciation Portfolio - Class A 554
Alger Capital Appreciation Portfolio - Class B 29,341
Item 27. Indemnification
Under Section 8.4 of Registrant's Agreement and Declaration of Trust, any
past or present Trustee or officer of Registrant (including persons who serve at
Registrant's request as directors, officers or Trustees of another organization
in which Registrant has any interest as a shareholder, creditor or
otherwise[hereinafter referred to as a "Covered Person"]) is indemnified to the
fullest extent permitted by law against liability and all expenses reasonably
incurred by him in connection with any action, suit or proceeding to which he
may be a party or otherwise involved by reason of his being or having been a
Covered Person. This provision does not authorize indemnification when it is
determined, in the manner specified in the Agreement and Declaration of Trust,
that such Covered Person has not acted in good faith in the reasonable belief
that his actions were in or not opposed to the best interests of Registrant.
Moreover, this provision does not authorize indemnification when it is
determined , in the manner specified in the Agreement and Declaration of Trust,
that such Covered Person would otherwise be liable to Registrant or its
shareholders by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of his duties. Expenses may be paid by Registrant in advance
of the final disposition of any action, suit or proceeding upon receipt of an
undertaking by such Covered Person to repay such expenses to Registrant in the
event that it is ultimately determined that indemnification of such expenses is
not authorized under the Agreement and Declaration of Trust and either (i) the
Covered Person provides security for such undertaking, (ii) Registrant is
insured against losses from such advances, or (iii) the disinterested Trustees
or independent legal counsel determines, in the manner specified in the
Agreement and Declaration of Trust, that there is reason to believe the Covered
Person will be found to be entitled to indemnification.
Insofar as indemnification for liability arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to Trustees, officers and
controlling persons of Registrant pursuant to the foregoing provisions, or
otherwise, Registrant has been advised that in the opinion of the Securities and
Exchange Commission (the "SEC") such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by Registrant of expenses incurred or paid by a Trustee, officer or
controlling person of Registrant in the successful defense of any action, suit
or proceeding) is asserted by such Trustee, officer or controlling person in
connection with the securities being registered, 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 Securities
Act and will be governed by the final adjudication of such issue.
Item 28. Business and Other Connections of Investment Adviser
Alger Management, which serves as investment manager to Registrant, is
generally engaged in rendering investment advisory services to institutions and,
to a lesser extent, individuals. Alger Management presently serves as investment
adviser to two closed-end investment companies and to two other open-end
investment companies. The list required by this Item 28 regarding any other
business, profession, vocation or employment of a substantial nature engaged in
by officers and directors of Alger Management during the past two years is
incorporated by reference to Schedules A and D of Form ADV filed by Alger
Management pursuant to the Investment Advisers Act of 1940 (SEC File No.
801-06709).
Item 29. Principal Underwriter
(a) Alger Inc. acts as principal underwriter for Registrant, The Alger
American Fund, Spectra Fund and The Alger Retirement Fund and has acted as
subscription agent for Castle Convertible Fund, Inc. and Spectra Fund, Inc.
(b) The information required by this Item 29 with respect to each director,
officer or partner of Alger Inc. is incorporated by reference to Schedule A of
Form BD filed by Alger Inc. pursuant to the Securities Exchange Act of 1934 (SEC
File No. 8-6423).
(c) Not applicable.
Item 30. Location of Accounts and Records
All accounts and records of Registrant are maintained by Mr. Gregory S.
Duch, Fred Alger & Company, Incorporated, 30 Montgomery Street, Jersey City, NJ
07302.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) Not applicable.
(b) Not applicable.
(c) Registrant hereby undertakes to provide its annual report without
charge to any recipient of its Prospectus who requests the
information.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, as amended, Registrant has duly caused this Amendment to be
signed on its behalf by the undersigned, thereto duly authorized, in the City of
New York and State of New York on the 2nd day of June, 1997.
THE ALGER FUND
/s/ David D. Alger
By: ---------------------------
David D. Alger, President
/s/ Gregory S. Duch
ATTEST: --------------------------
Gregory S. Duch, Treasurer
Pursuant to the requirements of the Securities Act of 1933, this Amendment has
been signed below by the following persons in the capacities and on the dates
indicated.
SIGNATURE TITLE DATE
- --------- ----- ----
*------------------------ Chairman of the Board June 2, 1997
Fred M. Alger III
/s/ David D. Alger
- ------------------------- President and Trustee June 2, 1997
David D. Alger (Chief Executive Officer)
/s/ Gregory S. Duch
- ------------------------- Treasurer June 2, 1997
Gregory S. Duch (Chief Financial and
Accounting Officer)
*------------------------ Trustee June 2, 1997
Nathan E. Saint-Amand
*------------------------ Trustee June 2, 1997
Stephen E. O'Neil
*------------------------ Trustee June 2, 1997
Arthur M. Dubow
*------------------------ Trustee June 2, 1997
John T. Sargent
/s/ Gregory S. Duch
*By ---------------------
Gregory S. Duch
Attorney-in-Fact
<PAGE>
THE ALGER FUND
POWER OF ATTORNEY
Each of the undersigned officers and trustees of The Alger Fund, an
unincorporated business trust under the laws of the Commonwealth of
Massachusetts (the "Company"), hereby constitute and appoint David D. Alger and
Gregory S. Duch their true and lawful attorneys-in-fact and agents, such that
either Mr. Alger or Mr. Duch may so act, for them and on their behalf and in
their respective names, places and steads, in any and all capacities, to sign,
execute and affix their respective seals thereto and file any of the documents
referred to below relating to the Registration Statement on Form N-1A relating
to the Company's shares of beneficial interest as required to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, as amended, including any amendments
thereto, with all exhibits and any and all documents required to be filed with
respect thereto with any regulatory authority, granting unto said
attorney-in-fact and agent full authority to do and perform each and every act
and thing requisite and necessary to be done in order to effectuate the same as
fully to all intents and purposes as they might or could do if personally
present, hereby ratifying and confirming all that said attorney-in-fact and
agent may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned officers and trustees have hereunto set
their hands on this 15th day of February, 1995.
Signature Title
--------- -----
/s/ Fred M. Alger III Chairman of the Board (Chief
- ---------------------------------- Executive Officer
Fred M. Alger III
/s/ David D. Alger President and Trustee
- ----------------------------------
David D. Alger
/s/ Gregory S. Duch Treasurer (Chief Financial &
- ---------------------------------- Accounting Officer
Gregory S. Duch
/s/ Arthur M. Dubow Trustee
- ----------------------------------
Arthur M. Dubow
/s/ Stephen E. O'Neil Trustee
- ----------------------------------
Stephen E. O'Neil
/s/ Nathan E. Saint-Amand Trustee
- ----------------------------------
Nathan E. Saint-Amand
/s/ John T. Sargent Trustee
- ----------------------------------
John T. Sargent
<PAGE>
THE ALGER FUND
POWER OF ATTORNEY
Each of the undersigned officers and trustees of The Alger Fund, an
unincorporated business trust organized under the laws of the Commonwealth of
Massachusetts (the "Company") hereby constitute and appoint Fred M. Alger III
and George J. Boggio their true and lawful attorneys-in-fact and agents, such
that either Mr. Alger or Mr. Boggio may so act, for them and on their behalf and
in their respective names, places and steads, in any and all capacities, to
sign, execute and affix their respective seals thereto and file any of the
documents referred to below relating to the Registration Statement on Form N-1A
relating to the Company's shares of beneficial interest as required to be filed
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended, including any
amendments thereto, with all exhibits and any and all documents required to be
filed with respect thereto with any regulatory authority, granting unto said
attorney-in-fact and agent full authority to do and perform each and every act
and thing requisite and necessary to be done in order to effectuate the same as
fully to all intents and purposes as they might or could do if personally
present, hereby ratifying and confirming all that said attorney-in-fact and
agent may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned officers and trustees have hereunto set
their hands on this 13th day of October, 1986.
Signature Title
--------- -----
/s/ Fred M. Alger III President and Chairman
- ---------------------------------- Of The Board (Chief Executive
Fred M. Alger III Officer)
/s/ George J. Boggio Secretary and Treasurer
- ---------------------------------- (Chief Financial and
George J. Boggio Accounting Officer)
/s/ Nathan Emile Saint-Amand, M.D. Trustee
- ----------------------------------
Nathan Emile Saint-Amand, M.D.
/s/ Arthur M. Dubow Trustee
- ----------------------------------
Arthur M. Dubow
/s/ Stephen E. O'Neil Trustee
- ----------------------------------
Stephen E. O'Neil
/s/ John T. Sargent Trustee
- ----------------------------------
John T. Sargent
<PAGE>
Securities Act File No. 33-4959
Investment Company Act File No. 811-6880
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-1A
Registration Statement Under the Securities Act of 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 23 [x]
and/or
Registration Statement Under the Investment Company Act of 1940 [ ]
Amendment No. 25 [x]
(Check appropriate box or boxes)
THE ALGER FUND
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
--------------------------
E X H I B I T S
--------------------------
<PAGE>
INDEX TO EXHIBITS
Exhibit Page Number in Sequential
No. Number System
- ------- -------------------------
1(a) Agreement and Declaration of Trust. EDGAR 6/2/97 (1)
1(b) Certificate of Designation relating to Alger High Yield
Portfolio. EDGAR 6/2/97 (3)
1(c) Certificate of Designation relating to Alger Income and
Growth Portfolio. EDGAR 6/2/97 (3)
1(d) Certificate of Designation relating to Alger Balanced
Portfolio. EDGAR 6/2/97 (8)
1(e) Certificate of Designation relating to Alger MidCap Growth
Portfolio. EDGAR 6/2/97 (9)
1(f) Certificate of Designation relating to Alger Leveraged AllCap
Portfolio. EDGAR 6/2/97 (10)
1(g) Certificate of Amendment relating to Alger Capital Appreciation
Portfolio. EDGAR 6/2/97
1(h) Certificate of Termination relating to Alger Income and Growth
Portfolio. EDGAR 6/2/97
2 By-laws of Registrant. EDGAR 6/2/97 (1)
4 Specimen Share Certificates. EDGAR 6/2/97 (3) (8) (9) (10)
4(a)(i) Specimen Share Certificate for Alger Balanced Portfolio -
Class A
4(a)(ii) Specimen Share Certificate for Alger Balanced Portfolio -
Class B
4(a)(iii) Specimen Share Certificate for Alger Balanced Portfolio -
Class C
4(b)(i) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class A
4(b)(ii) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class B
4(b)(iii) Specimen Share Certificate for Alger MidCap Growth Portfolio-
Class C
4(c)(i) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class A
4(c)(ii) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class B
4(c)(iii) Specimen Share Certificate for Alger Capital Appreciation
Portfolio - Class C
4(d)(i) Specimen Share Certificate for Alger Growth Portfolio -
Class A
4(d)(ii) Specimen Share Certificate for Alger Growth Portfolio -
Class B
4(d)(iii) Specimen Share Certificate for Alger Growth Portfolio -
Class C
4(e)(i) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class A
4(e)(ii) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class B
4(e)(iii) Specimen Share Certificate for Alger Small Capitalization
Portfolio - Class C
<PAGE>
INDEX TO EXHIBITS
Exhibit Page Number in Sequential
No. Number System
- ------- -------------------------
5 Investment Management Agreements. EDGAR 6/2/97 (6)
5(a) Investment Management Agreement for Alger Balanced
Portfolio (8)
5(b) Investment Management Agreement for Alger MidCap Growth
Portfolio (9)
5(c) Investment Management Agreement for Alger Leveraged AllCap
Portfolio (11)
5(d) Investment Management Agreement for Alger Small Capitalization
Portfolio.
5(e) Investment Management Agreement for Alger Money Market Portfolio
5(f) Investment Management Agreement for Alger Growth Portfolio
6(a) Distribution Agreement EDGAR 6/2/97 (6)
6(a)(ii) Amendment to Distribution Agreement. [Form of]
6(b) Selected Dealer and Shareholder Servicing Agreement
EDGAR 6/2/97 (4)
8 Custody Agreement EDGAR 6/2/97
10(a) Opinion and Consent of Sullivan & Worcester
10(b) Opinion and Consent of Hollyer Brady Smith Troxell
Barrett Rockett Hines & Mone LLP
11 Consent of Arthur Andersen LLP
13 Form of Subscription Agreement EDGAR 6/2/97 (2)
13(a) Purchase Agreement for Alger Balanced Portfolio
EDGAR 6/2/97 (8)
13(b) Purchase Agreement for Alger MidCap Growth Portfolio
EDGAR 6/2/97 (9)
13(c) Purchase Agreement for Alger Leveraged AllCap Portfolio
EDGAR 6/2/97 (11)
13(d) Purchase Agreement for Alger Small Capitalization Portfolio
EDGAR 6/2/97 (Form of)
13(e) Purchase Agreement for Alger Growth Portfolio
EDGAR 6/2/97 (Form of)
15 Plan of Distribution EDGAR 6/2/97 (2)
15(b) Plan of Distribution for Class C Shares of The Alger Fund.
[Form of]
16 Schedule for computation of performance quotations provided in
the Statement of Additional Information
19(a) Rule 18f-3 Plan for Alger Balanced Portfolio - Class C. [Form of]
19(b) Rule 18f-3 Plan for Alger MidCap Growth Portfolio - Class C.
[Form of]
19(c) Rule 18f-3 Plan for Alger Capital Appreciation Portfolio - Class
C. [Form of]
19(d) Rule 18f-3 Plan for Alger Growth Portfolio - Class C. [Form of]
19(e) Rule 18f-3 Plan for Alger Small Capitalization Portfolio - Class
C. [Form of]
Exhibit 1(a)
THE ALGER FUND
---------------------------------------
AGREEMENT AND DECLARATION OF TRUST
---------------------------------------
Dated: March 20, 1986
<PAGE>
X WASHINGTON, D.C.
1025 CONNECTICUT AVENUE, N.W.
WASHINGTON, D.C. 20038
(808) 778-8180
TELECOPIER NO. XXXXXXXXXXX
SULLIVAN & WORCESTER
ONE POST OFFICE SQUARE
BOSTON MASSACHUSETTS 02108
(617) 330-2800
TELECOPIER NO. 617-338-2880
TWX 710-321-1878
IN NEW YORK CITY
787 THIRD AVENUE
NEW YORK, NEW YORK 10017
(212) 496-8660
TELECOPIER NO. XXXXXXXX
March 20, 1986
Secretary of State
Corporations Division
One Ashburton Place
Boston, MA 02108
Attention: Mrs. Gertrude Michaels
RE: THE ALGER FUND
Dear Mrs. Michaels:
Enclosed for filing with respect to the above-referenced trust please find an
Agreement and Declaration of Trust dated March 20, 1986. I also enclose a check
for $150.00 in payment of the filing fee.
Please note that I am the Initial Trustee and that the resident agent of the
Trust is Thomas E. Weesner. The address for both of us is c/o Sullivan &
Worcester, One Post Office Square, Boston, Massachusetts 02109.
Please date-stamp the enclosed copy of this letter to acknowledge receipt.
Very truly yours,
/s/ Bryan G. Tyson
- -------------------
Bryan G. Tyson
BGT/kas
Enclosure
<PAGE>
The Alger Fund
AGREEMENT AND DECLARATION OF TRUST
INDEX
PAGE
RECITALS 1
ARTICLE I THE TRUST 2
Section 1.1 Name 2
Section 1.2 Location 2
Section 1.3 Nature of Trust 2
Section 1.4 Definitions 2
Section 1.5 Real Property to be Converted into Personal Property 6
ARTICLE II. PURPOSE OF THE TRUST 7
ARTICLE III. POWERS OF THE TRUSTEE 7
Section 3.1 Powers in General 7
(a) Investments 8
(b) Disposition of Assets 8
(c) Ownership Powers 9
(d) Forms of Holding 9
(e) Reorganization, etc. 9
(f) Voting Trusts, etc. 9
(g) Contracts, etc. 9
(h) Guarantees, etc. 10
(i) Partnerships, etc. 10
(j) Insurance 10
(k) Pensions, etc. 10
(l) Power of Collection and Litigation 10
(m) Issuance and Repurchase of Shares 11
(n) Offices 11
(o) Expenses 11
(p) Agents, etc. 11
(q) Accounts 11
(r) Valuation 11
(s) Indemnification 11
(t) General 12
<PAGE>
Section 3.2 Borrowings; Financings; Issuance of Securities 12
Section 3.3 Deposits 12
Section 3.4 Allocations 12
Section 3.5 Further Powers; Limitations 13
ARTICLE IV. TRUSTEES AND OFFICERS 13
Section 4.1 Number, Designation, Election, Term, etc. 13
(a) Initial Trustee 13
(b) Number 13
(c) Election and Term 13
(d) Resignation and Retirement 14
(e) Removal 14
(f) Vacancies 14
(g) Acceptance of Trusts 15
(h) Effect of Death, Resignation, etc. 15
(i) Conveyance 15
(j) No Accounting 15
(k) Filings 15
Section 4.2 Trustees; Meetings; Participation by Telephone, etc. 16
Section 4.3 Committees; Delegation 16
Section 4.4 Officers 16
Section 4.5 Compensation of Trustees and Officers 17
Section 4.6 Ownership of Shares and Securities of the Trust 17
Section 4.7 Right of Trustees and Officers to Own Property or to
Engage in Business; Authority of Trustees to
Permit Others to Do Likewise 17
Section 4.8 Reliance on Experts 18
<PAGE>
Section 4.9 Surety Bonds 18
Section 4.10 Apparent Authority of Trustees and Officers 18
Section 4.11 Other Relationships Not Prohibited 18
Section 4.12 Payment of Trust Expenses 19
Section 4.13 Ownership of the Trust Property 19
ARTICLE V. DELEGATION OF MANAGERIAL RESPONSIBILITIES 20
Section 5.1 Appointment; Action by Less than All Trustees 20
Section 5.2 Certain Contracts 20
(a) Advisory 20
(b) Administration 21
(c) Distribution 21
(d) Custodian 21
(e) Transfer and Dividend Disbursing Agency 22
(f) Shareholder Servicing 22
(g) Accounting 22
ARTICLE VI. PORTFOLIOS AND SHARES 22
Section 6.1 Description of Portfolios and Shares 22
(a) Shares; Portfolios; Series of Shares 22
(b) Establishment, etc. of Portfolios;
Authorization of Shares 23
(c) Character of Separate Portfolios and
Shares Thereof 23
(d) Consideration of Shares 23
Section 6.2 Establishment and Designation of Certain
Portfolios; General Provisions for All Portfolios 24
(a) Assets Belonging to Portfolios 24
(b) Liabilities of Portfolios 25
(c) Dividends 25
(d) Liquidation 26
<PAGE>
(e) Voting 26
(f) Redemption by Shareholder 26
(g) Redemption at the Option of the Trust 26
(h) Net Asset Value 27
(i) Transfer 27
(j) Equality 27
(k) Rights of Fractional Shares 27
(l) Conversion Rights 28
Section 6.3 Ownership of Shares 28
Section 6.4 Investment in the Trust 28
Section 6.5 No Pre-emptive Rights 28
Section 6.6 Status of Shares 28
ARTICLE VII. SHAREHOLDERS VOTING POWERS AND MEETINGS 29
Section 7.1 Voting Powers 29
Section 7.2 Number of Votes and Manner of Voting; Proxies 29
Section 7.3 Meetings 30
Section 7.4 Record Dates 30
Section 7.5 Quorum and Required Vote 31
Section 7.6 Action by Written Consent 31
Section 7.7 Inspection of Records 31
Section 7.8 Additional Provisions 31
ARTICLE VIII LIMITATIONS OF LIABILITY; INDEMNIFICATION 31
Section 8.1 Trustees, Shareholders, etc. Not Personally
Liable; Notice 31
Section 8.2 Trustees; Good Faith Action; Expert Advice;
No Bond of Surety 32
<PAGE>
Section 8.3 Indemnification of Shareholders 33
Section 8.4 Indemnification of Trustees, Officers, etc. 33
Section 8.5 Compromise Payment 34
Section 8.6 Indemnification Not Exclusive, etc. 34
Section 8.7 Liability of Third Persons Dealing with Trustees 35
ARTICLE IX DURATION; REORGANIZATION; AMENDMENTS 35
Section 9.1 Duration and Termination of Trust 35
Section 9.2 Reorganization 35
Section 9.3 Amendments; etc. 36
Section 9.4 Filing of Copies of Declaration and Amendments 36
ARTICLE X MISCELLANEOUS 37
Section 10.1 Governing Law 37
Section 10.2 Counterparts 37
Section 10.3 Reliance by Third Parties 37
Section 10.4 References; Headings 37
Section 10.5 Use of the Name "Alger": 37
Signatures 38
Acknowledgments 39
<PAGE>
THE ALGER FUND
This AGREEMENT AND DECLARATION OF TRUST, made at Boston, Massachusetts this
20th day of March 1986, by and between the Settlor and the Trustee whose
signature is set forth below (the "Initial Trustees").
WITNESSETH THAT:
WHEREAS, Peter C. Aseltine, an individual residing in Boston, Massachusetts
(the "SETTLOR"), proposes to deliver to the Initial Trustee the sum of one
hundred dollars ($100.00) lawful money of the United States of America in trust
hereunder and to authorize the Initial Trustee and all other Persons acting as
Trustees hereunder to employ such funds, and any other funds coming into their
hands or the hands of their successor or successors as such Trustees, to carry
on the business of an investment company, and as such of buying, selling,
investing in or otherwise dealing in and with stocks, bonds, debentures,
warrants, options, futures contracts and other securities and interests therein;
or calls or puts with respect to any of the same, or such other and further
investment media and other property as the Trustees may deem advisable, which
are not prohibited by law or the terms of this Declaration; and
WHEREAS, the Initial Trustee, is willing to accept such sum, together with
any and all additions thereto and the income or increments thereof, upon the
terms, conditions and trusts hereinafter set forth; and
WHEREAS, it is proposed that the assets held by the Trustees be divided
into separate funds, each with its own separate investment portfolio, investment
objectives, policies and purposes, and that the beneficial interest in each such
fund shall be divided into transferable Shares of Beneficial Interest, a
separate Series of Shares for each fund, all in accordance with the provisions
hereinafter set forth; and
WHEREAS, it is desired that the trust established hereby (the "TRUST") be
managed and operated as a trust with transferable shares under the laws of
Massachusetts, of the type commonly known as and referred to as a Massachusetts
business trust, in accordance with the provisions hereinafter set forth.
NOW, THEREFORE, the Initial Trustee, for himself and his successors as
Trustees, hereby declares, and agrees with the Settlor, for himself and for all
Persons who shall hereafter become holders of Shares of Beneficial Interest of
the Trust, of any Series, that the Trustees will hold the sum delivered to them
upon the execution hereof, and all other and further cash, securities and other
property of every type and description which they may in any way acquire in
their capacity as such Trustees, together with the income therefrom and the
proceeds thereof, IN TRUST NEVERTHELESS, to manage and dispose of the same for
the benefit of the holders from time to time of the Shares of Beneficial
Interest of the several Series being issued and to be issued hereunder and in
the manner and subject of the provisions hereof, to wit:
<PAGE>
ARTICLE I
THE TRUST
SECTION 1.1 Name: The name of the Trust shall be
"THE ALGER FUND",
and so far as may be practicable and the Trustees shall conduct the Trust's
activities, execute all documents and sue or be sued under that name, which name
(and the work "TRUST" whatever used in this Agreement and Declaration of Trust,
except where the context otherwise requires) shall refer to the Trustees in
their capacity as Trustees, and not individually or personally, and shall not
refer to the officers, agents or employees of the Trust or of such Trustees, or
to the holders of the Shares of Beneficial Interest of the Trust, oF any Series.
If the Trustees determine that the use of such name is not practicable, legal or
convenient at any time or in any jurisdiction, or if the Trust is required to
discontinue the use of such name pursuant to Section 10.5 hereof, then subject
to that Section, the Trustees may use such other designation, or they may adopt
such other name for the Trust as they deem proper, and the Trust may hold
property and conduct its activities under such designation or name.
SECTION 1.2. LOCATION. The Trust shall have an office in Boston,
Massachusetts, unless changed by the Trustees to another location in
Massachusetts or elsewhere, but such office need not be the sole or principal
office of the Trust. The Trust may have such other offices or places of business
as the Trustees may from time to time determine to be necessary or expedient.
SECTION 1.3. NATURE OF TRUST. The Trust shall be a trust with transferable
shares under the laws of The Commonwealth of Massachusetts, of the type referred
to in Section 1 or Chapter 182 of the Massachusetts General Laws and commonly
termed a Massachusetts business trust. The Trust is not intended to be, shall
not be deemed to be, and shall not be treated as, a general partnership, limited
partnership, joint venture, corporation or joint stock company. The Shareholders
shall be beneficiaries and their relationship to the Trustees shall be solely in
that capacity in accordance with the rights conferred upon them hereunder.
SECTION 1.4. DEFINITIONS. As used in this Agreement and Declaration of
Trust, the following terms shall have the meanings set forth below unless the
context thereof otherwise requires:
<PAGE>
"ACCOUNTING AGENT" shall have the meaning designated in Section 5.2 (g)
hereof.
"ADMINISTRATOR" shall have the meaning designated in Section 5.2 (b)
hereof.
"AFFILIATED PERSON" shall have meaning assigned to it in the 1940 Act.
"BY-LAWS" shall mean the By-Laws of the Trust, as amended from time to
time.
"CERTIFICATE OF DESIGNATION" shall have the meaning designated in Section
6.1 hereof.
"CERTIFICATE OF TERMINATION" shall have the meaning designated in Section
6.1 hereof.
"COMMISSION" shall have the same meaning as in the 1940 Act.
"CONTRACTING PARTY" shall have the meaning designated in the preamble to
Section 5.2 hereof.
"COVERED PERSON" shall have the meaning designated in section 8.4 hereof.
"CUSTODIAN" shall have the meaning designated in Section 5.2 (d) hereof.
"DECLARATION" and "DECLARATION OF TRUST" shall mean this Agreement and
Declaration of Trust and all amendments or modifications thereof as from time to
time in effect. References in this Agreement and Declaration of Trust to
"hereof", "herein" and "hereunder" shall be deemed to refer to the Declaration
of Trust generally and shall not be limited to the particular text, Article or
Section in which such words appear.
"DISABLING CONDUCT" shall have the meaning designated in Section 8.4
hereof.
"DISTRIBUTOR" shall have the meaning designated in Section 5.2 (c) hereof.
"DIVIDEND DISBURSING AGENT" shall have the meaning designated in Section
5.2 (e) hereof.
"GENERAL ITEMS" shall have the meaning defined in Section 6.2 (a) hereof.
"INITIAL TRUSTEE" shall have the meaning defined in the preamble hereto.
<PAGE>
"INVESTMENT ADVISOR" shall have the meaning stated in Section 5.2 (a)
hereof.
"MAJORITY OF THE TRUSTEES" shall mean a majority of the Trustees in office
at the time in question. At any time at which there shall be only one (1)
Trustee in office, such term shall mean such Trustee.
"MAJORITY SHAREHOLDER VOTE," as used with respect to the election of any
Trustee at a meeting of Shareholders, shall mean the vote for the election of
such Trustee of a plurality of all outstanding Shares of the Trust, without
regard to Series, represented in person or by proxy and entitled to vote
thereon, provided that a quorum (as determined in accordance with the By-Laws)
is present, and as used with respect to any other action required or permitted
to be taken by Shareholders, shall mean the vote for such action of the holders
of that majority of all outstanding shares (or, where a separate vote of Shares
of any particular Series is to be taken, the affirmative vote of that majority
of the outstanding Shares of that Series) of the Trust which consists of: (i) a
majority of all Shares (or of Shares of the particular Series) reresented in
person or by proxy and entitled to vote on such action at the meeting of
Shareholders at which such action is to be taken, provided that a quorum (as
determined in accordance with the By-Laws) is present; or (ii) if such action is
to be taken by written consent of Shareholders, a majority of all Shares (or of
Shares of the particular Series) issued and outstanding and entitled to vote on
such action; PROVIDED, that (iii) as used with respect to any action requiring
the affirmative vote of "a majority of the outstanding voting securities," as
the quoted phrase is defined in the 1940 Act, of the Trust or of any Portfolio,
"MAJORITY SHAREHOLDER VOTE" means the vote for such action at a meeting of
Shareholders of the smallest majority of all outstanding Shares of the Trust (or
of Shares of the particular Portfolio) entitled to vote on such action which
satisfies such 1940 Act voting requirement.
"1940 ACT" shall mean the provisions of the invest Investment Company Act
of 1940 and the rules and regulations thereunder, both as amended from time to
time, and any order or orders thereunder which may from time to time be
applicable to the Trust.
"PERSON" shall mean and include individuals, as well as corporations,
limited partnerships, general partnerships, joint stock companies, joint
ventures associations, banks, trust companies, land trusts, business trusts or
other organizations established under the laws of any jurisdiction, whether or
not considered to be legal entities, and governments and agencies and political
subdivisions thereof
"PORTFOLIO" or "PORTFOLIOS" shall mean one or more of the separate
components of the assets of the Trust which are now or hereafter established and
designated under or in accordance with the provisions of Article VI hereof.
<PAGE>
"PORTFOLIO ASSETS" shall have the meaning defined in Section 6.2 (a)
hereof.
"PRINCIPAL UNDERWRITER" shall have the meaning designated in Section 5.2
(c) hereof.
"PROSPECTUS" as used with respect to any Portfolio or Series of Shares,
shall mean the prospectus relating to such Portfolio or Series which constitutes
part of the currently effective Registration Statement of the Trust under the
Securities Act of 1933 as such prospectus may be amended or supplemented from
time to time.
"SECURITIES" shall mean any and all bills, notes, bonds, debentures or
other obligations or evidences of indebtedness, time deposits, certificates of
deposit, bankers' acceptances, commercial paper, repurchase agreements or other
money market instruments; stocks, shares or other equity ownership interests;
and warrants, options or other instruments representing rights to subscribe for,
purchase, receive or otherwise acquire or to sell, transfer, assign or otherwise
dispose of, and "scrip, certificates, receipts or other instruments evidencing
any ownership rights or interests in, any of the foregoing and "when issued" and
"delayed delivery" contracts for securities, issued, guaranteed or sponsored by
any governments, political subdivisions or governmental authorities, agencies or
instrumentalities, by any individuals, firms, companies, corporations,
syndicates, associations or trusts, or by any other organizations or entities
whatsoever, irrespective of their forms or the names by which they may be
described, whether or not they be organized and operated for profit, and whether
they be domestic or foreign with respect to The Commonwealth of Massachusetts or
the United States of America.
"SECURITIES OF THE TRUST" shall mean any Securities issued by the Trust.
"SERIES" shall mean one or more of the series of Shares authorized by the
Trustees to represent the beneficial interest in one or more of the Portfolios.
"SETTLOR" shall have the meaning stated in the first "Whereas" clause set
forth above.
"SHAREHOLDER" shall mean as of any particular time any Person shown of
record at such time on the books of the Trust as a holder of outstanding Shares
of any Series, and shall include a pledge into whose name any such Shares are
transferred in pledge.
"SHAREHOLDER SERVICING AGENT" shall have the meaning designated in Section
5.2(f) hereof.
"SHARES" shall mean the transferable units into which the beneficial
interest in the Trust and each Portfolio of the Trust (as the context may
require) shall be divided from time to time, and includes fractions of Shares as
well as whole Shares. All references herein to "Shares" which are not
accompanied by a reference to any particular Series or Portfolio shall be deemed
to apply to outstanding Shares without regard to Series.
<PAGE>
"SINGLE CLASS VOTING," as used with respect to any matter to be acted upon
at a meeting or by written consent of the Shareholders, shall mean a style of
voting in which each holder of one or more Shares shall be entitled to one vote
on the matter in question for each Share standing in his name on the records of
the Trust, irrespective of Series, and all outstanding Shares of all Series vote
as a single class.
"STATEMENT OF ADDITIONAL INFORMATION," as used with respect to any
Portfolio or Series of Shares, shall mean the statement of additional
information relating to such Portfolio or Series, which constitutes part of the
currently effective Registration Statement of the Trust under the Securities Act
of 1933, as such statement of additional information may be amended or
supplemented from time to time.
"TRANSFER AGENT" shall have the meaning defined in Section 5.2(e) hereof.
"TRUST" shall have the meaning stated in the fourth "Whereas" clause set
forth above.
"TRUSTEES" shall mean, collectively, the Initial Trustee, so long as he
shall continue in office, and all other individuals who at the time in question
have been duly neglected or appointed as Trustees of the Trust in accordance
with the provisions hereof and who have qualified and are then in office. At any
time at which there shall be only one (1) Trustee in office, such term shall
mean such single Trustee.
SECTION 1.5. REAL PROPERTY TO BE CONVERTED INTO PERSONAL PROPERTY.
Notwithstanding any other provisions hereof, any real property at any time
forming part of the Trust Property shall be held in trust for sale and
conversion into personal property at such time or times and in such manner and
upon such terms as the Trustees shall approve, but the Trustees shall have power
until the termination of this Trust to postpone such conversion as long as they
in their uncontrolled discretion shall think fit, and for the purpose of
determining the nature of the interest of the Shareholders therein, all such
real property shall at all times be considered as personal property.
<PAGE>
ARTICLE II
PURPOSE OF THE TRUST
The purpose of the Trust shall be to engage in the business of being an
investment company, and as such of subscribing for, purchasing or otherwise
acquiring, holding for investment or trading in, borrowing, lending and selling
short, selling, assigning, negotiating or exchanging and otherwise disposing of,
and turning to, account, realizing upon and generally dealing in and with, in
any manner, (a) Securities of all kinds, (b) precious metals and other minerals,
contracts to purchase and sell, and other interests of every nature and kind in,
such metals or minerals, and (c) rare coins and other numismatic items, and all
as the Trustees in their discretion shall determine to be necessary, desirable
or appropriate, and to exercise and perform any and every act, thing or power
necessary, suitable or desirable for the accomplishment of such purpose, the
attainment of any of the objects or the furtherance of any of the powers given
hereby which are lawful purposes, objects or powers of a trust with transferable
shares of the type commonly termed a Massachusetts business trust; and to do
every other act or acts or thing or things incidental or appurtenant to or
growing out of or in connection with the aforesaid objects, purposes or powers,
or any of them, which a trust of the type commonly termed a Massachusetts
business trust is not now or hereafter prohibited from doing, exercising or
performing.
ARTICLE III
POWERS OF THE TRUSTEES
SECTION 3.1. POWERS IN GENERAL. The Trustees shall have, without other or
further authorization, full, entire, exclusive and absolute power, control and
authority over, and management of, the business of the Trust and over the Trust
Property, to the same extent as if the Trustees were the sole owners of the
business and property of the Trust in their own right, and with such powers of
delegation as may be permitted by this Declaration, subject only to such
limitations as may be expressly imposed by this Declaration of Trust or by
applicable law. The enumeration of any specific power or authority herein shall
not be construed as limiting the aforesaid power or authority or any specific
power or authority. Without limiting the foregoing, the Trustees may adopt
By-Laws not inconsistent with this Declaration of Trust providing for the
conduct of the business and affairs of the Trust and may amend and repeal them
to the extent that such By-Laws do not reserve that right to the Shareholders;
they may select, and from time to time change, the fiscal year of the Trust;
they may adopt and use a seal for the Trust, PROVIDED, that unless otherwise
required by the Trustees, it shall not be necessary to place the seal upon, and
its absence shall not impair the validity of, any document, instrument or other
<PAGE>
paper executed and delivered by or on behalf of the Trust; they may from time to
time in accordance with the provisions of Section 6.1 hereof establish one or
more Portfolios to which they may allocate such of the Trust Property, subject
to such liabilities, as they shall deem appropriate, each such Portfolio to be
operated by the Trustees as a separate and distinct investment medium and with
separately defined investment objectives and policies and distinct investment
purposes, all as established by the Trustees, or from time to time changed by
them; they may as they consider appropriate elect and remove officers and
appoint and terminate agents and consultants and hire and terminate employees,
any one or more of the foregoing of whom may be a Trustee; they may appoint from
their own number, and terminate, any one or more committees consisting of one or
more Trustees, including without implied limitation in Executive Committee,
which may, when the Trustees are not in session and subject to, the 1940 Act,
exercise some of the power and authority of the Trustees as the Trustees may
determine; in accordance with Section 5.2 they may employ one or more Investment
Advisors, Administrators and Custodians and may authorize any Custodian to
employ subcustodians or agents and to deposit all or any part of such assets in
a system or systems for the central handling of Securities, retain Transfer,
Dividend Disbursing, Accounting or Shareholder Servicing Agents or any of the
foregoing, provide for the distribution of Shares by the Trust through one or
more Distributors, Principals Underwriters or otherwise, set record dates or
times for the determination of Shareholders entitled to participate in, benefit
from or act with respect to various matters; and in general they may delegate to
any officer of the Trust, to any Committee of the Trustees and to any employee,
Investment Advisor, Administrator, Distributor, Custodian, Transfer Agent,
Dividend Disbursing Agent, or any other agent or consultant of the Trust, such
authority, powers, functions and duties as they consider desirable or
appropriate for the conduct of the business and affairs of the Trust, including
without implied limitation the power and authority to act in the name of the
Trust and of the Trustees, to sign documents and to act as attorney-in-fact for
the Trustees. Without limiting the foregoing and to the extent not inconsistent
with the 1940 Act or other applicable law, the Trustees shall have power and
authority;
(a) INVESTMENTS. To invest and reinvest cash and other property; to
buy, for cash or on margin, and otherwise acquire and hold, Securities
created or issued by any Persons, including Securities maturing after the
possible termination of the Trust; to make payment therefor in any lawful
manner in exchange for any of the Trust Property; and to hold cash or other
property uninvested without in any event being bound or limited by any
present or future law or custom in regard to investments by trustees;
(b) DISPOSITION OF ASSETS. Upon such terms and conditions as they deem
best, to lend, sell, exchange, mortgage, pledge, hypothecate, grant
security interests in, encumber, negotiate, convey, transfer or otherwise
dispose of, and to trade in, any and all of the Trust Property, free and
clear of all trusts, for cash or on terms, with or without advertisement,
and on such terms as to payment, security or otherwise, all as they shall
deem necessary or expedient;
<PAGE>
(c) OWNERSHIP POWERS. To vote or give assent, or exercise any and all
other rights, powers and privilege or ownership with respect to, and to
perform any and all duties and obligations as owners of, any Securities or
other property forming part of the Trust Property, the same as any
individual might do; to exercise powers and rights of subscription or
otherwise which in any manner arise out of ownership of Securities, and to
receive powers of attorney from, and to execute and deliver proxies or
powers of attorney to, such Person or Persons as the Trustees shall deem
proper, receiving from or granting to such Person or Persons such power and
discretion with relation to Securities or other property of the Trust, all
as the Trustees shall deem proper;
(d) FORM OF HOLDING. To hold any Security or other property in a form
not indicating any trust, whether in bearer, unregistered or other
negotiable form, or in the name of the Trustees or of the Trust, or of the
Portfolio to which such Securities or property belong, or in the name of a
Custodian, subcustodian or other nominee or nominees, or otherwise, upon
such terms, in such manner or with such powers, as the Trustees may
determine, and with or without indicating any trust or the interest of the
Trustees therein;
(e) REORGANIZATION, ETC. To consent to or participate in any plan for
the reorganization, consolidation or merger of any corporation or issuer,
any Security of which is or was held in the Trust or any Portfolio; to
consent to any contract, lease, mortgage, purchase or sale of property by
such corporation or issuer, and to pay calls or subscriptions with respect
to any Security forming part of the Trust Property;
(f) VOTING TRUSTS, ETC. To join with other holders of any Securities
in acting through a committee, depository, voting trustee or otherwise, and
in that connection to deposit any Security with, or transfer any Security
to, any such committee, depository or trustee, and to delegate to them such
power and authority with relation to any Security (whether or not so
deposited or transferred) as the Trustees shall deem prosper, and to agree
to pay, and to pay, such portion of the expenses and compensation of such
committee, depository or trustee as the Trustees shall deem proper;
(g) CONTRACTS, ETC. To enter into, make and perform all such
obligations, contracts, agreements and undertakings of every kind and
description, with any Person or Persons, as the Trustees shall in their
discretion deem expedient in the conduct of the business of the Trust, for
such terms as they shall see fit, whether or not extending beyond the term
of office of the Trustees, or beyond the possible expiration of the Trust;
to amend, extend, release or cancel any such obligations, contracts,
agreements, or understandings; and to execute, acknowledge, deliver and
record all written instruments which they may deem necessary or expedient
in the exercise of their powers;
<PAGE>
(h) GUARANTEES, ETC. To endorse or guarantee the payment of any notes
or other obligations of any Person; to make contracts of guaranty or
suretyship, or otherwise assume liability for payment thereof; and to
mortgage and pledge the Trust Property or any part thereof to secure any of
or all such obligations; (i) PARTNERSHIPS, ETC. To enter into joint
ventures, general or limited partnerships and any other combinations or
associations;
(j) INSURANCE. To purchase and pay for entirely out of Trust Property
such insurance as they may deem necessary or appropriate for the conduct of
the business, including, without limitation, insurance policies insuring
the assets of the Trust and payment of distributions and principal on its
portfolio investments, and insurance policies insuring the Shareholders,
Trustees, officers, employees, agents, consultants, Investment Advisors,
managers, Administrators, Distributors, Principal Underwriters, or other
independent contractors, or any thereof (or any Person connected
therewith), of the Trust, individually, against all claims and liabilities
of every nature arising by reason of holding, being or having held any such
office or position, or by reason of any action alleged to have been taken
or omitted by any such Person in any such capacity, including any action
taken or omitted that may be determined to constitute negligence, whether
or not the Trust would have the power to indemnify such Person against such
liability;
(k) PENSIONS, ETC. To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry our pension,
profit-sharing, share bonus, share purchase, savings, thrift and other
retirement, incentive and benefit plans, trusts and provisions, including
the purchasing of life insurance and annuity contracts as a means of
providing such retirement and other benefits, for any or all of the
Trustees, officers and agents of the Trust;
(l) POWER OF COLLECTION AND LITIGATION. To collect, sue for and
receive all sums of money coming due to the Trust, to employ counsel, and
to commence, engage in, prosecute, intervene in, join, defend, compound,
compromise, adjust or abandon, in the name of the Trust, any and all
actions, suits, proceedings, disputes, claims, controversies, demands or
other litigation or legal proceedings relating to the Trust, the business
of the Trust, the Trust Property, or the Trustees, officers, employees,
agents and other independent contractors of the Trust, in their capacity as
such, at law or in equity, or before any other bodies or tribunals, and to
compromise, arbitrate or otherwise adjust any dispute to which the Trust
may be a party, whether or not any suit is commenced or any claim shall
have been made or asserted;
(m) ISSUANCE AND REPURCHASE OF SHARES. To issue, sell, repurchase,
redeem, retire, cancel, acquire, hold, resell, reissue, dispose, transfer,
and otherwise deal in Shares of any Series, and, subject to Article VI
hereof, to apply to any such repurchase, redemption, retirement,
cancellation or acquisition of Shares of any Series, any of the Portfolio
Assets belonging to the Portfolio to which such Series relates, whether
constituting capital or surplus or otherwise, to the full extent now or
hereafter permitted by applicable law; provided, that any Shares belonging
to the Trust shall not be voted, directly or indirectly;
(n) OFFICES. To have one or more offices, and to carry on all or any
of the operations and business of the Trust, in any of the States,
Districts or Territories of the United States, and in any and all foreign
countries, subject to the laws of such State, District, Territory or
country;
(o) EXPENSES. To incur and pay any and all such expenses and charges
as they may deem advisable (including without limitation appropriate fees
to themselves as Trustees), and to pay all such sums of money for which
they may be held liable by way of damages, penalty, fine or otherwise;
(p) AGENTS, ETC. To retain and employ any and all such servants,
agents, employees, attorneys, brokers, investment advisers, accountants,
architects, engineers, builders, escrow agents depositories, consultants,
ancillary trusts, custodians, agents for collection, insurers, banks and
officers, as ;they think best for the business of the Trust or any
Portfolio, to supervise and direct the acts of any of the same, and to fix
and pay their compensation and define their duties;
(q) ACCOUNTS. To determine, and from time to time change, the method
or form in which the accounts of the Trust shall be kept;
<PAGE>
(r) VALUATION. Subject to the requirements of the 1940 Act, to
determine from time to time the value of all or any part of the Trust
Property and of any services, Securities, property or other consideration
to be furnished to or acquired by the Trust, and from time to time to
revalue all or any part of the Trust Property in accordance with such
appraisals or other information as is, in the Trustees' sole judgment,
necessary and satisfactory;
(s) INDEMNIFICATION. In addition to the mandatory indemnification
provided for in Article VIII hereof and to the extent permitted by law, to
indemnify or enter into agreements with respect to indemnification with any
Person with whom this Trust has dealings, including, without limitation,
any independent contractor, to such extent as the Trustees shall determine;
and
(t) GENERAL. To do all such other acts and things and to conduct,
operate, carry on and engage in such other lawful businesses or business
activities as they shall in their sole and absolute discretion consider to
be incidental to the business of the Trust or any Portfolio as an
investment company, and to exercise all powers which they shall in their
discretion consider necessary, useful or appropriate to carry on the
business of the Trust or any Portfolio, to promote any of the purposes for
which the Trust is formed, whether or not such things are specifically
mentioned herein, in order to protect or promote the interests of the Trust
or any Portfolio, or otherwise to carry out the provisions of this
Declaration.
SECTION 3.2. BORROWINGS; FINANCINGS; ISSUANCE OF SECURITIES. The Trustees
have power to borrow or in any other manner raise such sum or sums of money, and
to incur such other indebtedness for goods or services, or for or in connection
with the purchase or other acquisition of property, as they shall deem advisable
for the purposes of the Trust, in any manner and on any terms, and to evidence
the same by negotiable or non-negotiable Securities which may mature at any time
or times, even beyond the possible date of termination of the Trust; to issue
Securities of any type for such cash, property, services or other
considerations, and at such time or times and upon such terms, as they may deem
advisable; and to reacquire any such Securities. Any such Securities of the
Trust may, at the discretion of the Trustees, be made convertible into Shares of
any Series, or may evidence the right to purchase, subscribe for or otherwise
acquire Shares of any Series, at such times and on such terms as the Trustees
may prescribe.
SECTION 3.3. DEPOSITS. Subject to the requirements of the 1940 Act, the
Trustees shall have power to deposit, any moneys or Securities included in the
Trust Property with any one or more banks, trust companies or other banking
institutions, whether or not such deposits will draw interest. Such deposits are
to be subject to withdrawal in such manner as the Trustees may determine, and
the Trustees shall have no responsibility for any loss which may occur be reason
of the failure of the bank, trust company or other banking institution with
which any such moneys or Securities have been deposited, other than liability
based on their gross negligence or willful fault.
SECTION 3.4. ALLOCATIONS. The Trustees shall have power to determine
whether moneys or other assets received by the Trust shall be charged or
credited to income or capital, or allocated between income and capital,
including the power to amortize or fail to amortize any part or all of any
premium or discount, to treat any part or all of the profit resulting from the
maturity or sale of any asset, whether purchased at a premium or at a discount,
as income or capital, or to apportion the same between income and capital, to
apportion the sale price of any asset between income and capital, and to
determine in what manner any expenses or disbursements are to be borne as
between income and capital, whether or not in the absence of the power and
authority conferred by this Section 3.4 such assets would be regarded as income
or as capital or such expense or disbursement would be charged to income or to
capital; to treat any dividend or other distribution on any investment as income
or capital, or to apportion the same between income and capital; to provide or
fail to provide reserves, including reserves for depreciation, amortization or
obsolescence in respect of any Trust Property in such amounts and by such
methods as they shall determine; to allocate less than al of the consideration
paid for Shares of any Series to the shares of beneficial interest account of
the Portfolio to which such Shares relate and to allocate the balance thereof to
paid-in capital of that Portfolio, and to reallocate such amounts from time to
time; all as the Trustees may reasonably deem proper.
<PAGE>
SECTION 3.5. FURTHER POWERS; LIMITATIONS. The Trustees shall have power to
do all such other matters and things, and to execute all such instruments, as
they deem necessary, proper or desirable in order to carry out, promote or
advance the interests of the Trust, although such matters or things are not
herein specifically mentioned. Any determination as to what is in the interests
of the Trust made by the Trustees in good faith shall be conclusive. In
construing the provisions of this Declaration of Trust, the presumption shall be
in favor of a grant of power to the Trustees. The Trustees shall not be required
to obtain any court order to deal with the Trust Property. The Trustees may
limit their right to exercise any of their powers through express restrictive
provisions in the instruments evidencing or providing the terms for any
Securities of the Trust or in other contractual instruments adopted on behalf to
the Trust.
ARTICLE IV
TRUSTEES AND OFFICERS
SECTION 4.1. NUMBER, DESIGNATION, ELECTION, TERM, ETC.
(a) INITIAL TRUSTEE. Upon his execution of this Declaration of Trust
or a counterpart hereof or some other writing in which he accepts such
Trusteeship and agrees to the provisions hereof, the individual whose
signature is affixed hereto as Initial Trustee shall become the Initial
Trustee hereof.
(b) NUMBER. The Trustees serving as such, whether named above or
hereafter becoming Trustees, may increase (to not more than twenty (20)) or
decrease the number of Trustees to a number other than the number
theretofore determined by a written instrument signed by a Majority of the
Trustees (or by an officer of the Trust pursuant to the vote of a Majority
of the Trustees). No decrease in the number of Trustees shall have the
effect of removing any trustee from office prior to the expiration of his
term, but the number of Trustees may be decreased in conjunction with the
removal of a trustee pursuant to subsection (e) of this Section 4.1.
<PAGE>
(c) ELECTION AND TERM. The Trustees shall be elected by the
Shareholders of the Trust at the first meeting of Shareholders immediately
prior to the initial public offering of Shares of the Trust, and the term
of office of any trustees in office before such election shall terminate at
the time of such election. Subject to Section 16(a) of the 1940 Act and to
the preceding sentence of this subsection (c), the Trustees shall have the
power to set and alter the terms of office of the Trustees, and at any time
to lengthen or shorten their own terms or make their terms of unlimited
duration, to elect their own successors and, pursuant to subsection (f) of
this Section 4.1, to appoint Trustees, to fill vacancies; PROVIDED, that
Trustees shall be elected by a Majority Shareholder Vote at any such time
or times as the Trustees shall determine that such action is required under
Section 16(a) of the 1940 Act or; if not so required, that such action is
advisable; and FURTHER PROVIDED, that, after the initial election of
Trustees by the Shareholders, the term of office of any incumbent Trustee
shall continue until the termination of this Trust or his earlier death,
resignation, retirement, bankruptcy, adjudicated incompetency or other
incapacity or removal, or if not so terminated, until the election of such
Trustee's successor in office has become effective in accordance with this
subsection (c).
(e) REMOVAL. Any trustee may be removed with or without cause at any
time: (i) by written instrument, signed by a least two-thirds (2/3) of the
number of Trustees prior to such removal, specifying the date upon which
such removal shall become effective; or (ii) by vote of Shareholders
holding not less than two-thirds (2/3) of the Shares of each Series then
outstanding, cast in person or by proxy at any meeting called for the
purpose; or (iii) by a written declaration signed by Shareholders holding
not less than two-thirds (2/3) of the Shares of each Series then
outstanding and filed with the Trust's Custodian.
(f) VACANCIES. Any vacancy or anticipated vacancy resulting from any
reason, including an increase in the number of Trustees, may (but need not
unless required by the 1940 Act) be filled by a Majority of the Trustees,
subject to the provisions of Section 16(a) of the 1940 Act, through the
appointment in writing of such other individual as such remaining Trustees
in their discretion shall determine; PROVIDED, that if there shall be not
Trustee in office, such vacancy or vacancies shall be filled by vote of the
Shareholders. Any such appointment or election shall be effective upon such
individual's written acceptance of his appointment as a Trustee and his
agreement to be bound by the provision of this Declaration of Trust, except
that any such appointment in anticipation of a vacancy to occur be reason
of retirement, resignation or increase in the number of Trustees to be
effective at a later date shall become effective only at or after the
effective date of said retirement, resignation or increase in the number of
Trustees.
<PAGE>
(g) ACCEPTANCE OF TRUSTS. Any individual appointed as a Trustee under
subsection (f), and any individual elected as a Trustee under subsection
(c), of this Section 4.1 who was not, immediately prior to such election,
acting as a Trustee, shall accept such appointment or election in writing
and agree in such writing to be bound by the provisions hereof, and
whenever such individual shall have executed such writing and any
conditions to such appointment or election shall have been satisfied, such
individual shall become a Trustee and the Trust Property shall vest in the
new Trustee, together with the continuing Trustees, without any further act
or conveyance.
(h) EFFECT OF DEATH, RESIGNATION, ETC. No vacancy, whether resulting
from the death, resignation, retirement, removal or incapacity of any
Trustee, an increase in the number of trustees or otherwise, shall operate
to annul or terminate the Trust hereunder or to revoke or terminate any
existing agency or contract created or entered into pursuant to the terms
of this Declaration of Trust. Until such vacancy is filled as provided in
this Section 4.1, the Trustees in office (if any), regardless of their
number, shall have all the powers granted to the Trustees and shall
discharge all the duties imposed upon the Trustees by this Declaration. A
written instrument certifying the existence of such vacancy signed by a
majority of the Trustees shall be conclusive evidence of their existence of
such vacancy.
(i) CONVEYANCE. In the event of the resignation or removal of a
Trustee or his otherwise ceasing to be a Trustee, such former Trustee or
his legal representative shall, upon request of the continuing Trustees,
execute and deliver such documents as may be required for the purpose of
consummating or evidencing the conveyance to the Trust or the remaining
Trustees of any Trust Property held in such former Trustee's name, but the
execution and delivery of such documents shall not be requisite to the
vesting of title to the Trust Property in the remaining Trustees, as
provided in subsection (g) of this Section 4.1 and in Section 4.13 hereof.
(j) NO ACCOUNTING. Except to the extent required by the 1940 Act or
under circumstances which would justify his removal for cause, no Person
ceasing to be a Trustee (nor the estate of any such Person) shall be
required to make an accounting to the Shareholders or remaining Trustees
upon such cessation.
(k) FILINGS. Whenever there shall be a change in the composition of
the Trustees, the Trust shall cause to be filed in the office of the
Secretary of The Commonwealth of Massachusetts and in each other place
where the Trustee is required to file amendments to this Declaration a copy
of (i) the instrument by which (in the case of the appointment of a new
Trustee, or the election of an individual who was not theretofore a
Trustee) the new Trustee accepted his appointment or election and agreed to
be bound by the terms of this Declaration, or (in the case of a
resignation) by which the former Trustee resigned as such, together in
either case with a certificate of one of the other Trustees as to the
circumstances of such election, appointment or resignation, or (ii) in the
case of the removal or death of a Trustee, a certificate of one of the
Trustees as to the circumstances of such removal or resignation.
<PAGE>
SECTION 4.2. TRUSTEES' MEETINGS; PARTICIPATION BY TELEPHONE, ETC. An annual
meeting of Trustees shall be held not later than the last day of the fourth
month after the end of each fiscal year of the Trust and special meetings may be
held from time to time, in such case, upon the call of such officers as may be
thereunto authorized by the By-Laws or vote of the Trustees, or by any two (2)
Trustees, or pursuant to a vote of the Trustees adopted at a duly constituted
meeting of the Trustees, and upon such notice as shall be provided in the
By-Laws. The Trustees may act with or without a meeting, and a written consent
to any matter, signed by a majority of the Trustees, shall be equivalent to
action duly taken at a meeting of the trustees, duly called and held. Except as
otherwise provided by the 1949 Act or other applicable law, or by this
Declaration of Trust or the By-Laws, any action to be taken by the Trustees may
be taken by a majority of the Trustees present at a meeting of Trustees (a
quorum, consisting of at least a majority of the Trustees, being present, within
or without Massachusetts. If authorized by the By-Laws, all or any one or more
Trustees may participate in a meeting of the Trustees or any Committee thereof
by means of conference telephone or similar means of communication by means of
which all Persons participating in the meeting can hear each other, and
participation in a meeting pursuant to such means of communication shall
constitute presence in person at such meeting. The minutes of any meeting thus
held shall be prepared in the same manner as a meeting at which all participants
were present in person.
SECTION 4.3. COMMITTEES; DELEGATION. The Trustees shall have power,
consistent with their ultimate responsibility to supervise the affairs of the
Trust, to delegate from time to time to an Executive Committee, and to one or
more other Committees, or to any single Trustee, the doing of such things and
the exception of such deeds or other instruments, either, in the name of the
Trust or the names or the Trustees or as their attorney or attorneys in fact, or
otherwise as the Trustees may from time to time deem expedient, and any
agreement, deed, mortgage, lease or other instrument or writing executed by the
Trustee or Trustees or other Person to whom such delegation was made shall be
valid and binding upon the trustees and upon the Trust.
SECTION 4.4. OFFICERS. The Trustees shall annually elect such officers or
agents, who shall have such powers, duties and responsibilities as the Trustees
may deem to be advisable, and as they shall specify by resolution or in the
By-Laws. Except as may be provided in the By-Laws, any officer elected by the
Trustees may be removed at any time with or without cause Any two (2) or more
offices may be held by the same individual.
<PAGE>
SECTION 4.5. COMPENSATION OF TRUSTEES AND OFFICERS. The Trustees shall fix
the compensation of all officers and Trustees. Without limiting the generality
of any of the provisions hereof, the Trustees shall entitled to receive
reasonable compensation for their general services as such, and to fix the
amount of such compensation, and to pay themselves or any one or more of
themselves such compensation for special services, including legal, accounting,
or other professional services, as they in good faith may deem reasonable. No
Trustee or officer resigning and (except where a right to receive compensation
for a definite future period shall be expressly provided in a written agreement
with the Trusts duly approved by the Trustees) no Trustee or officer removed
shall have any right to any compensation as such Trustee or officer for any
period following his resignation or removal, or any right to damages on account
of his removal, whether his compensation be by the month, by the year or
otherwise.
SECTION 4.6. OWNERSHIP OF SHARES AND SECURITIES OF THE TRUST. Any Trustee,
and any officer, employee or agent of the Trust, and any organization in which
any such Person is interested, may acquire, own, hold and dispose of Shares of
Any Series and other Securities of the Trust for his or its individual account,
may exercise all rights of a holder of such Shares or Securities to the same
extent and in the same manner as if such Person were not such a Trustee,
officer, employee or agent of the Trust; subject, in the case of Trustees and
officers, to the same imitations as directors or officers (as the case may be)
of a Massachusetts business corporation; and the Trust may issue and sell or
cause to be issued and sold and may purchase any such Shares or other Securities
from any such Person or any such organization, subject only to the general,
limitations, restrictions or other provisions applicable to the sale or
purchases of Shares of such Series or other Securities of the Trust generally.
SECTION 4.7. RIGHT OF TRUSTEES AND OFFICERS TO OWN PROPERTY OR TO ENGAGE IN
BUSINESS; AUTHORITY OF TRUSTEES TO PERMIT OTHERS TO DO LIKEWISE. The Trustees,
in their capacity as Trustees, and (unless otherwise specifically directed by
vote of the Trustees) the officers of the Trust in their capacity as such, shall
not be required to devote their entire time to the business and affairs of the
Trust. Except as otherwise specifically provided by vote of the Trustees, or by
agreement in any particular case, any trustee or officer of the Trust may
acquire, own, hold and dispose of, for his own individual account, any property,
and acquire, own, hold, carry on and dispose of, for his own individual account,
any business sentry or business activity, whether similar or dissimilar to any
property or business entity or business, activity invested in or carried on by
the Trust, and without first offering the same as an investment opportunity to
the Trust, and may exercise all rights in respect thereof as if he were not a
Trustee or officer of the Trust. the Trustees shall also have power, generally
or in specific cases, to permit employees or agents of the Trust to have the
same rights (or lesser rights) to acquire hold, own and dispose of property and
business, to carry on business, and to accept investment opportunities without
offering them to the Trust, as the Trustees have by virtue of this Section 4.7.
<PAGE>
SECTION 4.8. RELIANCE ON EXPERTS. The Trustees and officers may consult
with counsel, engineers, brokers, appraisers, auctioneers, accountants,
investment bankers, securities analysts or other Persons (any of which may be a
firm in which one or more of the trustees or officers is or are members or
otherwise interested) whose profession gives authority to a statement made by
them on the subject in question, and who are reasonable deemed by the Trustees
or officers in question to be competent, and the advise or opinion of such
Persons shall be full and complete personal protection to all of the Trustees
and officers in respect of any action taken or suffered by them in good faith
and in reliance on or in accordance with such advice or opinion. In discharging
their duties, Trustees and officers, when acting in good faith, may rely upon
financial statements of the Trust represented to them to be correct by any
officer of the Trust having charge of its books of account, or stated in a
written report by an independent certified public accountant fairly to present
the financial position of the Trust. The Trustees and officers may rely, and
shall be personally protected in acting, upon any instrument or other document
believed by them to be genuine.
SECTION 4.9. SURETY BONDS. No Trustee, officer, employee or agent of the
Trust shall, as such, be obligated to give any bond or surety or other security
for the performance of any of his duties, unless required by applicable law or
regulation, or unless the Trustees shall otherwise determine in any particular
case.
SECTION 4.10. APPARENT AUTHORITY OF TRUSTEES AND OFFICERS. No purchaser,
lender, transfer agent or other Person dealing with the Trustees or any officer
of the Trust shall be bound to make any inquiry concerning the validity of any
transaction purporting to be made by the Trustees or by such officer, or to make
inquiry concerning or believable for the application of money or property paid,
loaned or delivered to or on the order of the Trustees or of such officer.
SECTION 4.11. OTHER RELATIONSHIPS NOT PROHIBITED. The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, manager,
adviser, principal underwriter or distributor or agent of or for any
Contracting Party (as defined in Section 5.2 hereof), or of or for any
parent or affiliate of any Contracting party, or that the Contracting Party
or any parent or affiliate thereof is a Shareholder or has an interest in
the rust or any Portfolio, or that
<PAGE>
(ii) any Contracting Party may have a contract providing for the
rendering of any similar services to one or more other corporations, trusts
associations, partnerships, limited partnerships or other organizations, or
have other business or interest, shall not affect the validity shall not
affect the validity of any contract for the performance and assumption of
services, duties and responsibilities to, for or of the Trust and/or the
Trustees or disqualify any Shareholder, Trustee or officer of the Trust
from voting upon or executing the same or create any liability or
accountability to the Trust or to the holders of Shares of any Series,
PROVIDED, that, in the case of any relationship or interest referred to in
the preceding clause (i) on the part of any Trustee or officer of the
Trust, either (x) the material facts as to such relationship or interest
have been disclosed to or are known by the Trustees not having any such
relationship or interest and the contract involved is approved in good
faith by a majority of such Trustees not having any such relationship or
interest (even though such unrelated or disinterested Trustees are less
than a quorum of all of the Trustees), (y) the material facts as to such
relationship or interest and as to the contract have been disclosed to or
are known by the shareholders entitled to vote thereon and the contract
involved is specifically approved in good faith by vote of the
Shareholders, or (z) the Specific contract involved is fair to the Trust as
of the time it is authorized, approved or ratified by the Trustees or by
the Shareholders.
SECTION 4.12. PAYMENT OF TRUST EXPENSES. The Trustees are authorized to pay
or to cause to be paid out of the principal or income of the Trust, or partly
out of principal and partly out of income, and according to any allocation to
particular Portfolios made by them pursuant to Section 6.2(b) hereof, all
expenses, fees, charges, taxes and liabilities incurred or arising in connection
with the business and affairs of the trust or in connection with the management
thereof, including but not limited to, the Trustees' compensation and such
expenses and charges for the services of the Trust's officers, employees,
Investment Advisor, Administrator, Distributor," Principal Underwriter, auditor,
counsel, Custodian, Transfer Agent, Dividend Disbursing Agent, Accounting Agent,
Shareholder Servicing Agent, and such other agents, consultants, and independent
contractors and such other expenses and charges as the Trustees may deem
necessary or proper to incur.
SECTION 4.13. OWNERSHIP OF THE TRUST PROPERTY. Legal title to all the Trust
Property shall be vested in the Trustees as joint tenants, except that the
Trustees shall have power to cause legal title to any Trust Property to be held
by or in the name of one or more of the Trustees, or in the name of the trust,
or of any particular Portfolio, or in the name of any other Person as nominee,
on such terms as the Trustees may determine, PROVIDED, that the interest of the
Trust and of the respective Portfolio therein is appropriately protected. The
right, title and interest of the Trustees in the Trust Property shall vest
automatically in each Person who may hereafter become a Trustee. Upon the
termination of the term of office of a Trustee as provided in Section 4.1(c),
(d) or (e) hereof, such Trustee shall automatically cease to have any, right,
title or interest in any of the Trust Property and the right, title and interest
of such Trustee in the Trust Property shall vest automatically in the remaining
Trustees. Such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to Section
4.1(i) hereof.
<PAGE>
ARTICLE V
DELEGATION OF MANAGERIAL RESPONSIBILITIES
SECTION 5.1 APPOINTMENT; ACTION BY LESS THAN ALL TRUSTEES. The Trustees
shall be responsible for the general operating policy of the Trust and for the
general supervisions of the business of the Trust conducted by officers, agents,
employees or advisers of the Trust or by independent contractors, but the
Trustees shall not be required personally to conduct all the business of the
Trust and, consistent with their ultimate responsibility as stated herein, the
Trustees may appoint, employ or contract with one or more officers, employees
and agents to conduct, manage and/or supervise the operations the Trust, and may
grant or delegate such authority to such officers, employees and/or agents as
the Trustees may, in their sole discretion, deem to be necessary or desirable,
without regard to whether such authority is normally granted or delegated by
Trustees. With respect to those matters of the operation and business of the
Trust which they shall elect to conduct themselves, except as otherwise provided
by this Declaration or the By-Laws, if any, the Trustees may authorize any
single Trustee or defined group of Trustees, or any committee consisting of a
number of Trustees less than the whole number of Trustees then in office without
specification of the particular Trustees required to be included therein, to act
for and to bind the Trust, to the same extent as the whole number of Trustees
could do, either with respect to one or more particular matters or classes of
matters, or generally.
SECTION 5.2. CERTAIN CONTRACTS. Subject to compliance with the provisions
of the 1940 Act, but notwithstanding any limitations of present and future law
or custom in regard to delegation of powers by trustees generally, the Trustees
may, at anytime and from time to time in their discretion and without limiting
the generality of their powers and authority otherwise set forth herein, enter
into one or more contracts with any one or more corporation, trusts,
associations, partnerships, limited partnerships or other types of
organizations, or individuals ("CONTRACTING PARTY"), to provide for the
performance and assumption of some or all of the following services, duties and
responsibilities to, for or on behalf of the Trust and/or any Portfolio, and/or
the Trustees, and to provide for the performance and assumption of such other
services, duties and responsibilities in addition to those set forth below, as
the Trustees may deem appropriate:
<PAGE>
(a) ADVISORY. An investment advisory or management agreement whereby
the Investment Advisor shall undertake to furnish the Trust such
management, investment advisory or supervisory, administrative, accounting,
legal, statistical and research facilities and services, and such other
facilities and services, if any, as the Trustees shall from time to time
consider desirable, al upon such terms and conditions as the trustees may
in their discretion determine to be not inconsistent with his Declaration,
the applicable provisions of the 1940 Act or any applicable provisions of
the By-Laws. Any such advisory or management agreement and any amendment
thereto shall be subject to approval by a Majority Shareholder vote at a
meeting of the Shareholders of the Trust. Notwithstanding any provisions of
this Declaration, the Trustees may authorize the Investment Advisor
(subject to such general or specific instructions as the Trustees may from
time to time adopt) to effect purchases, sales, loans or exchanges of
portfolio securities of the Trust on behalf of the Trustees or may
authorize any officer or employee of the rust or any Trustee to effect such
purchases, sales, loans or exchanges pursuant to recommendations of the
Investment Advisor (and all without further action by the Trustees). Any
such purchases, sales, loans and exchanges shall be deemed to have been
authorized by al of the Trustees. The Trustees may, in their sole
discretion, call a meeting If shareholders in order to submit to a vote of
Shareholders at such meeting the approval of continuance of any such
investment advisory or management agreement. If the Shareholders of any
Portfolio should fail to approve any such investment advisory or
management, the Investment Advisor may nonetheless serve as Investment
Advisor with respect to any other Portfolio whose Shareholders shall have
approved such contract.
(b) ADMINISTRATION. An agreement whereby the agent, subject to the
general supervision of the Trustees and in conformity with any policies of
the Trustees and in conformity with any policies of the Trustees with
respect to the operations of the Trust and each Portfolio, will supervise
all or any part of the operations of the Trust and each Portfolio, and will
provide al or any part of the administrative and clerical personnel, office
space and office equipment and services appropriate for the efficient
administration and operations of the Trust and each Portfolio (any such
agent being herein referred to as an "ADMINISTRATOR").
(c) DISTRIBUTION. An agreement providing for the sale of Shares of
any one or more Series to net the Trust not less than the net asset value
per Share (as described in Section 6.2 (h) hereof) and pursuant to which
the Trust may appoint the other party to such agreement as its principal
underwriter or sales agent for the distribution of such agreement as its
principal underwriter or sales agent of the distribution of such Shares.
The agreement shall contain such terms and conditions as the Trustees may
in their discretion determine to be not inconsistent with this Declaration,
the applicable provisions of the 1940 Act and any applicable provisions of
the by-Laws (any such event being herein referred to as a "DISTRIBUTOR" or
a "PRINCIPAL UNDERWRITER", as the case may be).
(d) CUSTODIAN. The appointment of a bank or trust company having an
aggregate capital, surplus and undivided profits (as shown in its last
published report) of at least two million dollars ($2,000,000) as custodian
of the Securities and cash of the Trust and of each Portfolio and of the
accounting records in connection therewith (any such agent being here
referred to as a "CUSTODIAN").
<PAGE>
(e) TRANSFER AND DIVIDEND DISBURSING AGENCY. An agreement with an
agent to maintain records of the ownership of outstanding Shares, the
issuance and redemption and the transfer thereof (any such agent being
herein referred to as a "Transfer Agent"), and to disburse any dividends
declared by the Trustees and/or the instructions of any particular
Shareholder to reinvest any such dividends, (any such agent being herein
referred to as a "Dividend Disbursing Agent").
(f) SHAREHOLDER SERVICING. An agreement with an agent to provide
service with respect to the relationship of the Trust and its Shareholders,
records with respect to Shareholders and their Shares, and similar matters
(any such, agent being herein referred to as a "SHAREHOLDER SERVICING
AGENT").
(g) ACCOUNTING. An agreement with an agent to handle all or any part
of the accounting responsibilities, whether with respect to the Trust's
properties, Shareholders or otherwise (any such agent being herein referred
to as an "ACCOUNTING AGENT").
The same Person may be the Contracting Party for some or all of the services,
duties and responsibilities to, for and of the Trust and/or the Trustees, and
the contracts with respect thereto may contain such terms interpretive of or in
addition to the delineation of the services, duties and responsibilities
provided for, including provisions that are not inconsistent with the 1940 Act
relating to the standard of duty of and the rights to indemnification of the
Contracting Party and others, as the Trustees may determine. Nothing herein
shall preclude, prevent or limit the rust or a Contracting Party from entering
into sub-contractual arrangements relative to any of the matters referred to in
subsections (a) through (g) of this Section 5.2.
ARTICLE VI
PORTFOLIOS AND SHARES
SECTION 6.1. DESCRIPTION OF PORTFOLIOS AND SHARES.
(a) Shares; Portfolio, Series of Shares. The beneficial interest in
the Trust shall be divided into Shares having a nominal interest in the
Trust shall be divided into Shares having a nominal or par value of one
mill ($.001) per Share, and all of one class, or which an unlimited number
may be issued. The Trustees shall have the authority from time to time to
establish and designate one or more separate, distinct and independent
Portfolios into which the assets of the Trust shall be divided, and to
authorize a separate Series of Shares for each such Portfolio (each of
which Series, including without limitation each Series authorized in
Section 6.2 hereof, shall represent interest only in the Portfolio with
respect to which such Series was authorized), as they deem necessary or
desirable. Except as otherwise provided as to a particular Portfolio
herein, or in the Exhibit 1(a)(2)
<PAGE>
Certificate of Designation therefor, The Trustees shall have all the rights
and powers, and be subject to all the duties and obligations, with respect
to each such Portfolio and the assets and affairs thereof as they have
under this Declaration with respect to the Trust and the Trust Property in
general.
(b) ESTABLISHMENT, ETC. OF PORTFOLIOS; AUTHORIZATION OF SHARES. The
establishment and designation of any Portfolio in addition to the
Portfolios established and designated in Section 6.2 hereof and the
authorization of the Shares thereof shall be effective upon the execution
by a Majority of the Trustees (or by an officer of the Trust pursuant to
the vote of a Majority of the Trustees) of an instrument setting forth such
establishment and designation and the relative rights and preferences of
the Shares of such Portfolio and the manner in which the same may be
amended (a "CERTIFICATE OF DESIGNATION"), and may provide that the number
of Shares of such Series which may be issued is unlimited, or may limit the
number issuable. At any time that there are no Shares outstanding of any
particular Portfolio previously established and designated, including any
Portfolio established and designated in Section 6.2 hereof, the Trustees
may by an instrument executed by a Majority of the Trustees (or by an
officer of the Trust pursuant to the vote of a Majority of the Trustees)
terminate such Portfolio and the establishment and designation thereof and
the authorization of its Shares (a "CERTIFICATE OF TERMINATION"). Each
Certificate of Designation, Certificate of Termination and any instrument
amending a Certificate of Designation shall have the status of an amendment
to this Declaration of Trust, and shall be filed and become effective as
provided in Section 9.4 hereof.
(c) CHARACTER OF SEPARATE PORTFOLIOS AND SHARES THEREOF. Each
Portfolio established hereunder shall be a separate component of the assets
of the Trust, and the holders of Shares of the Series representing the
beneficial interest in the assets of that Portfolio shall be considered
Shareholders of such Portfolio, but such shareholders shall also be
considered Shareholders of the Trust for purposes of receiving reports and
notices and, except as otherwise provided herein or in the Certificate of
Designation of a particular Portfolio as to such Portfolio, or as required
by the 1940 Act or other applicable law, the right to vote, all without
distinction by Series. The Trustees shall have exclusive power without the
requirement of Shareholder approval to establish and designate such
separate and distinct Portfolios, and to fix and determine the relative
rights and preferences as between the shares of the respective Portfolios
as to rights of redemption and the price, terms and manner of redemption,
special and relative rights as to dividends and other distributions and on
liquidation, sinking or purchase fund provisions, conversion rights, and
conditions under which the Shareholders of the several Portfolios shall
have separate voting rights or no voting rights.
(d) CONSIDERATION FOR SHARES. The Trustees may issue Shares of any
Series for such consideration (which may include property subject to, or
acquired in connection with the assumption of, liabilities) and on such
terms as they may determine (or for no consideration if pursuant to a Share
dividend or split-up), all without action or approval of the Shareholders.
All Shares when so issued on the terms determined by the Trustees shall be
fully paid and non-assessable (but may be subject to mandatory contribution
back to the Trust as provided in Section 6.2(h) hereof). The Trustees may
classify or reclassify any unissued shares, or any Shares of any Series
previously issued and reacquired by the Trust, into Shares of one or more
other Portfolios that may be established and designated from time to time.
SECTION 6.2 ESTABLISHMENT AND DESIGNATION OF CERTAIN PORTFOLIOS; GENERAL,
PROVISIONS FOR ALL PORTFOLIOS. Without limiting the authority of the Trustees
set forth in Section 6.1(a) hereof to establish and designate further
Portfolios, there are hereby established and designated the following five (5)
Portfolios. The Alger Money Market Portfolio, The Alger Tax-Exempt Money
Portfolio, The Alger Fixed Income Portfolio, The Alger Small Capitalization
Portfolio and The Alger Growth Portfolio. The Shares of such Portfolios, and the
Shares of any further Portfolios that may from time to time be established and
designated by the Trustees shall (unless the Trustees otherwise determine with
respect to some further Portfolio at the time of establishing and designating
the same) have the following relative rights and preferences:
(a) ASSETS BELONGING TO PORTFOLIOS. Any portion of the Trust Property
allocated to a particular Portfolio, and all consideration received by the
Trust for the issue or sale of Shares of such Portfolio, together with all
assets in which such consideration is invested or reinvested, all interest,
dividends, income, earnings, profits and gains therefrom, and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be
held by the Trustees in trust for the benefit of the holders of Shares of
that Portfolio and shall irrevocably belong to that Portfolio for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of such Portfolio shall not have, and shall be
conclusively deemed to have waived, any claims to the assets of any
Portfolio of which they are not Shareholders. Such consideration, assets,
interest, dividends, income, earnings, profits, gains and proceeds,
together with any General Items allocated to that Portfolio as provided in
the following sentence, are herein referred to collectively as "Portfolio
Assets" of such Portfolio, and as assets "BELONGING TO" that Portfolio. In
the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Portfolio (collectively, "GENERAL ITEMS"), the
Trustees shall allocate such General Items to and among any one or more of
the Portfolios established and designated from time to time in such manner
and on such basis as they, in their sole discretion, deem fair and
equitable; and any General Items so allocated to a particular Portfolio
shall belong to and be part of the Portfolio Assets of that Portfolio. Each
such allocation by the Trustees shall be conclusive and binding upon the
Shareholders of all Portfolios for all purposes.
<PAGE>
(b) LIABILITIES OF PORTFOLIOS. The assets belonging to each particular
Portfolio shall be charged with the liabilities in respect of that
Portfolio and all expenses, costs, charges and reserves attributable to
that Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Portfolio shall be allocated and charged by the Trustees to
and among any one or more of the Portfolios established and designated from
time to time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The Indebtedness, expenses, costs,
charges and reserves allocated and so charged to a particular Portfolio are
herein referred to as "liabilities of" that Portfolio. Each allocation of
liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all Portfolios for all
purposes. Any creditor of any Portfolio may look only to the assets of that
Portfolio to satisfy such creditor's debt.
(c) DIVIDENDS. Dividends and distributions on Shares of a particular
Portfolio may be paid with such frequency as the Trustees may determine,
which may be daily or otherwise pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the Trustees may
determine, to the Shareholders of that Portfolio, from such of the income,
accrued or realized, and capital gains, realized or unrealized, and out of
the assets belonging to that Portfolio, as the Trustees may determine,
after providing for actual and accrued liabilities of that Portfolio. All
dividends and distributions on Shares of a particular Portfolio shall be
distributed pro rata to the Shareholders of that Portfolio in proportion to
the number of such Shares held by such holders at the date and time of
record established for the payment of such dividends or distributions,
except that in connection with any dividend or distribution program or
procedure the Trustees may determine that no dividend or distribution shall
be payable on Shares as to which the Shareholder's purchase order and/or
payment have not been received by the time or times established by the
Trustees under such program or procedure, or that dividends or
distributions shall be payable on Shares which have been tendered by the
holder thereof for redemption or repurchase, but the redemption or
repurchase proceeds of which have not yet been paid to such Shareholder.
Such dividends and distributions may be made in cash or Shares of that
Portfolio or a combination thereof as determined by the Trustees, or
pursuant to any program that the Trustees may have in effect at the time
for the election by each Shareholder of, the mode of the making of such
dividend or distribution to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with subsection (h) of this Section 6.2.
<PAGE>
(d) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, the Shareholders of each Portfolio of which Shares are outstanding
shall be entitled to receive, when and as declared by the Trustees, the
excess of the Portfolio Assets over the liabilities of such Portfolio. The
assets so distributable to the Shareholders of any particular Portfolio
shall be undistributed among such Shareholders in proportion to the number
of Shares of that Portfolio held by them and recorded on the books of the
Trust. The liquidation of any particular Portfolio may be authorized by
vote of a Majority of the Trustees, subject to the affirmative vote of "a
majority of the outstanding voting securities" of that Portfolio, as the
quoted phrase is defined in the 1940 Act, determined in accordance with
clause (iii) of the definition of "MAJORITY SHAREHOLDER VOTE" in Section
1.4 hereof.
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article VII hereof.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of a particular
Portfolio shall have the right at such times as may be permitted by the
Trust, but no less frequently than once each week, to require the Trust to
redeem all or any part of his Shares of that Portfolio at a redemption
price equal to the net asset value per Share of that Portfolio next
determined in accordance with subsection (h) of this Section 6.2 after the
Shares are properly tendered for redemption; PROVIDED that the Trustees may
from time to time, in their discretion, determine and impose a fee for such
redemption. Payment of the redemption price shall be in cash; PROVIDED,
HOWEVER, that if the Trustees determine, which determination shall be
conclusive, that conditions exist which make payment wholly in cash unwise
or undesirable, the Trust may make payment wholly or partly in Securities
or other assets belonging to such Portfolio at the value of such Securities
or assets used in such determination of net asset value. Notwithstanding
the foregoing, the Trust may postpone payment of the redemption price and
may suspend the right of the holders of Shares of any Portfolio to require
the Trust to redeem Shares of that Portfolio during any period or at any
time when and to the extent permissible under the 1940 Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each Share of any Portfolio
shall be subject to redemption at the option of the Trust at the redemption
price which would be applicable if such Share were than being redeemed by
the Shareholder pursuant to subsection (f) of this Section 6.2: (i) at any
time, if the Trustees determine in their sole discretion that failure to so
redeem may have materially adverse consequences to the holders of the
Shares of the Trust or of any Portfolio, or (ii) upon such other conditions
with respect to maintenance of Shareholder accounts of a minimum amount as
may from time to time be determined by the Trustees and set forth in the
then current Prospectus of such Portfolio. Upon such redemption the holders
of the Shares so redeemed shall have no further right with respect thereto
other than to receive payment of such redemption price.
<PAGE>
(h) NET ASSET VALUE. The net asset value per Share of any Portfolio at
any time shall be the quotient obtained by dividing the value of the net
assets of such Portfolio at such time (being the current value of the
assets belonging to such Portfolio, less its then existing liabilities) by
the total number of Shares of that Portfolio then outstanding, all
determined in accordance with the methods and procedures, including without
limitation those with respect to rounding, established by the Trustees from
time to time. The Trustees may determine to maintain the net asset value
per Share of any Portfolio at a designated constant dollar amount and in
connection therewith may adopt procedures not inconsistent with the 1940
Act for the continuing declaration of income attributable to that Portfolio
as dividends payable in additional Shares of that Portfolio at the
designated constant dollar amount and for the handling of any losses
attributable to that Portfolio. Such procedures may provide that in the
event of any loss each Shareholder shall be deemed to have contributed to
the shares of beneficial interest account of that Portfolio his pro rata
portion of the total number of Shares required to be cancelled in order to
permit the net asset value per Share of that Portfolio to be maintained,
after reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Trust shall be deemed to have expressly agreed, by his
investment in any Portfolio with respect to which the Trustees shall have
adopted any such procedure, to make the contribution referred to in the
preceding sentence in the event of any such loss.
(i) TRANSFER. All Shares of each particular Portfolio shall be
transferable, but transfers of Shares of a particular Portfolio will be
recorded on the Share transfer records of the Trust applicable to that
Portfolio only at such times as Shareholders shall have the right to
require the Trust to redeem Shares of that Portfolio and at such other
times as may be permitted by the Trustees.
(j) EQUALITY. All Shares of each particular Portfolio shall represent
an equal proportionate interest in the assets belonging to that Portfolio
(subject to the liabilities of the Portfolio), and each Share of any
particular Portfolio shall be equal to each other Share thereof; but the
provisions of this sentence shall not restrict any distinctions permissible
under subsection (c) of this Section 6.2 that may exist with respect to
dividends and distributions on Shares of the same Portfolio. The Trustees
may from time to time divide or combine the Shares of any particular
Portfolio into a greater or lesser number of Shares of that Portfolio
without thereby changing the proportionate beneficial interest in the
assets belonging to that Portfolio or in any way affecting the rights of
the holders of Shares of any other Portfolio.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share
of the Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust, if of the Portfolio to which they pertain.
<PAGE>
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of shares of any Portfolio shall have the right to convert said Shares into
Shares of one or more other Portfolios in accordance with such requirements
and procedures as the Trustees may establish.
SECTION 6.3. OWNERSHIP OF SHARES. The ownership of Shares shall be recorded
on the books of the Trust or of a Transfer Agent or similar agent for the Trust,
which books shall be maintained separately for the Shares of each Series that
has been authorized. Certificates evidencing the ownership of Shares need not be
issued except as the Trustees may otherwise determine from time to time, and the
Trustees shall have power to call outstanding Share certificates and to replace
them with book entries. The Trustees may make such rules as they consider
appropriate for the issuance of Share certificates, the use of facsimile
signatures, the transfer of Shares and similar matters. The record books of the
Trust as kept by the Trust or Trust Agent or similar agent, as the case may be,
shall be conclusive as to who are the Shareholders and as to the number of
Shares of each Portfolio held from time to time by each such Shareholder.
The holders of Shares of each Portfolio shall upon demand disclose to the
Trustees in writing such information with respect to their direct and indirect
ownership of Shares of such Portfolio as the Trustees deem necessary to comply
with the provisions of the Internal Revenue Code, or to comply with the
requirements of any other authority.
SECTION 6.4. INVESTMENTS IN THE TRUST. The Trustees may accept investments
in any Portfolio of the Trust from such Persons and on such terms and for such
consideration, not inconsistent with the provisions of the 1940 act, as they
from time to time authorize. The Trustees may authorize any Distributor,
Principal Underwriter, Custodian, Transfer Agent or other Person to accept
orders for the purchase of Shares that conform to such authorized terms and to
reject any purchase orders for Shares, whether or not conforming to such
authorized terms. SECTION 6.5. NO PRE-EMPTIVE RIGHTS. No Shareholder, by virtue
of holding Shares of any Portfolio, shall have any pre-emptive or other right to
subscribe to any additional Shares of that Portfolio; or to any shares of any
other Portfolio, or any other Securities issued by the Trust.
SECTION 6.5. NO PRE-EMPTIVE RIGHTS. No Shareholder, by virtue of holding
Shares of any Portfolio, shall have any pre-emptive or other right to subscribe
to any additional Shares of that Portfolio, or to any shares of any other
Portfolio, or any other Securities issued by the Trust.
SECTION 6.6. STATUS OF SHARES. Every Shareholder, by virtue of having
become a Shareholder, shall be held to have expressly assented and agreed to the
terms hereof and to have become a party hereto. Shares shall be deemed to be
personal property, giving only the rights provided herein. Ownership of Shares
shall not entitle the Shareholder to any title in or to the whole or any part of
the Trust Property or right to call for a partition or division of the same or
for an accounting, nor shall the ownership of Shares constitute the Shareholders
partners. The death of a Shareholder during the continuance of the Trust shall
not operate to terminate the Trust or any Portfolio, nor entitle the
representative of any deceased Shareholder to an accounting or to take any
action in court or elsewhere against the Trust or the Trustees, but only to the
rights of said decedent under this Declaration of Trust.
<PAGE>
ARTICLE VII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
SECTION 7.1. VOTING POWERS. The Shareholders shall have power to vote only
(i) for the election or removal of Trustees as provided in Sections 4.1(c) and
(e) hereof, (ii) with respect to the approval or termination in accordance with
the 1940 Act of any contract with a Contracting Party as provided in Section 5.2
hereof as to which Shareholder approval is as required by the 1940 Act, (iii)
with respect to any termination or reorganization of the Trust or any Portfolio
to the extent and as provided in Sections 9.1 and 9.2 hereof, (iv) with respect
to any amendment of this Declaration of Trust to the extent and as provided in
Section 9.3 hereof, (v) to the same extent as the stockholders of a
Massachusetts business corporation as to whether or not a court action,
proceeding or claim should or should not be brought or maintained derivatively
or as a class action on behalf of the Trust or any Portfolio, or the
Shareholders of any of them (PROVIDED, HOWEVER, that a Shareholder of a
particular Portfolio shall not in any event be entitled to maintain a derivative
or class action on behalf of any other Portfolio or the Shareholders thereof),
and (vi) with respect to such additional matters relating to the Trust as may be
required by the 1940 Act, this Declaration of Trust, the By-Laws or any
registration of the Trust with the Commission (or any successor agency) or any
State, or as the Trustees may consider necessary or desirable. If and to the
extent that the Trustees shall determine that such action is required by law,
they shall cause each matter required or permitted to be voted upon at a meeting
or by written consent of Shareholders to be submitted to a separate vote of the
outstanding Shares of each Portfolio entitled to vote thereon; PROVIDED, that
(i) when expressly required by this Declaration or by the 1940 Act, actions of
Shareholders shall be taken by Single Class Voting of all outstanding Shares of
each Series whose holders are entitled to vote thereon; and (ii) when the
Trustees determine that any matter to be submitted to a vote of Shareholders
affects only the rights or interests of Shareholders of one or more but not all
Portfolios, then only the Shareholders of the Portfolios so affected shall be
entitled to vote thereon.
SECTION 7.2. NUMBER OF VOTES AND MANNER OF VOTING; PROXIES. On each matter
submitted to a vote of the Shareholders, each Holder of Shares of any Series
shall be entitled to a number of votes equal to the number of Shares of such
Series standing in his name on the books of the Trust. There shall be no
cumulative voting in the election of Trustees. Shares may be voted in person or
by proxy. A proxy with respect to Shares held in the name of two (2) or more
Persons shall be valid if executed by any one of them unless at or prior to
exercise of the proxy the Trust receives a specific written notion to the
contrary from any one of them. A proxy purporting to be executed by or on behalf
of a Shareholder shall be deemed valid unless challenged at or prior to its
exercise and the burden of proving invalidity shall rest on the challenger.
Until Shares are issued, the Trustees may exercise all rights of Shareholders
and may take any action required by law, this Declaration of Trust or the
By-Laws to be taken by Shareholders.
<PAGE>
SECTION 7.3. MEETINGS. Meetings of Shareholders may be called by the
Trustees from time to time for the purpose of taking action upon any matter
requiring the vote or authority of the Shareholders as herein provided, or upon
any other matter deemed by the Trustees to be necessary or desirable. Written
notice of any meeting of Shareholders shall be given or caused to be given by
the Trustees by mailing such notice at least seven (7) days before such meeting,
postage prepaid, stating the time, place and purpose of the meeting, to each
Shareholder at the Shareholder's address as it appears on the records of the
Trust. The Trustees shall promptly call and give notice of a meeting of
Shareholders for the purpose of voting upon removal of any Trustee of the Trust
when requested to do so in writing by Shareholders holding not less than ten
percent (10%) of the Shares then outstanding. If the Trustees shall fail to call
or give notice of any meeting of Shareholders for a period of thirty (30) days
after written application by Shareholders holding at least ten percent (10%) of
the Shares then outstanding requesting that a meeting be called for any other
purpose requiring action by the Shareholders as provided herein or in the
By-Laws, then Shareholders holding at least ten percent (10%) of the Shares then
outstanding may call and give notice of such meeting, and thereupon the meeting
shall be held in the manner provided for herein in case of call thereof by the
Trustees.
SECTION 7.4. RECORDING DATES. For the purpose of determining the
Shareholders who are entitled to vote or act at any meeting or any adjournment
thereof, or who are entitled to participate in any dividend or distribution, or
for the purpose of any other action, the Trustees may from time to time close
the transfer books for such period, not exceeding thirty (30) days (except at or
in connection with the termination of the Trust), as the Trustees determine; or
without closing the transfer books the Trustees may fix a date and time not more
than sixty (60) days prior to the date of any meeting of Shareholders or other
action as the date and time of record for the determination of Shareholders
entitled to vote at such meeting or any adjournment thereof or to be treated as
Shareholders of record for purposes of such other action, and any Shareholder
who was a Shareholder at the date and time to fixed shall be entitled to vote at
such meeting or any adjournment thereof or to be treated as a Shareholder of
record for purposes of such other action, even though he has since that date and
time disposed of his Shares, and no Shareholder becoming such after that date
and time shall be so entitled to vote at such meeting or any adjournment thereof
or to be treated as a Shareholder of record for purposes of such other action.
<PAGE>
SECTION 7.5. QUORUM AND REQUIRED VOTE. A majority of the Shares entitled to
vote shall be a quorum for the transaction of business at a Shareholders'
meeting, but any less number shall be sufficient for adjournments. Any adjourned
session or sessions may be held within a reasonable time after the date set for
the original meeting without the necessity of further notice. A Majority
Shareholder Vote at a meeting of which a quorum is present shall decide any
question, except when a different vote is required or permitted by any provision
of the 1940 Act or other applicable law or by this Declaration of Trust or the
By-Laws, or when the Trustees shall in their discretion require a larger vote or
the vote of a majority or larger fraction of the Shares of one or more
particular Series.
SECTION 7.6. ACTION BY WRITTEN CONSENT. Subject to the provisions of the
1940 Act and other applicable law, any action taken by Shareholders may be taken
without a meeting if a majority of Shareholders entitled to vote on the matter
(or such larger proportion thereof or of the Shares of any particular Series as
shall be required by the 1940 Act or by any express provision of this
Declaration of Trust or the By-Laws or as shall be permitted by the Trustees)
consent to the action in writing and if the writings in which such consent is
given are filed with the records of the meetings of Shareholders, to the
same-extent and for the same period as proxies given in connection with a
Shareholders' meeting. Such consent shall be treated for all purposes as a vote
taken at a meeting of Shareholders.
SECTION 7.7. INSPECTION OF RECORDS. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted stockholders of
a Massachusetts business corporation under the Massachusetts Business
Corporation Law.
SECTION 7.8. ADDITIONAL PROVISIONS. The By-Laws may include further
provisions for Shareholders votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE VIII
LIMITATION OF LIABILITY, INDEMNIFICATION
SECTION 8.1. TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE.
The Trustees and officers of the Trust, in incurring any debts, liabilities or
obligations, or in limiting or omitting any other actions for or in connection
with the Trust, are or shall be deemed to be acting as Trustees or officers of
the Trust and not in their own capacities. No Shareholder shall be subject to
any personal liability whatsoever in tort, contract or otherwise to any other
Person or Persons in connection with the assets or the affairs of the Trust or
of any Portfolio, and subject to Section 8.4 hereof, no Trustee, officer,
employee or agent of the Trust shall be subject to any personal liability
whatsoever in tort, contract, or otherwise, to any other Person or Persons in
<PAGE>
connection with the assets or affairs of the Trust or of any Portfolio, save
only that arising from his own willful misfeasance, bad faith, gross negligence
or reckless disregard of his duties involved in the conduct of his office or the
discharge of his functions. The Trust (or if the matter relates only to a
particular Portfolio, that Portfolio) shall be solely liable for any and all
debts, claims, demands, judgments, decrees, liabilities or obligations of any
and every kind against or with respect to the Trust or such Portfolio in tort,
contract or otherwise in connection with the assets or the affairs of the Trust
or such Portfolio, and all Persons dealing with the Trust or any Portfolio shall
be deemed to have agreed that resort shall be had solely to the Trust Property
of the Trust or the Portfolio Assets of such Portfolio, as the case may be, for
the payment or performance thereof.
The Trustees shall use their best efforts to ensure that every note, bond,
contract, instrument, certificate or undertaking made or issued by the Trustees
or by any officer shall give notice that this Declaration of Trust is on file
with the Secretary of The Commonwealth of Massachusetts and shall recite to the
effect that the same was executed or made by or on behalf of the Trust or by
them as Trustees or Trustee or as officers or officer, and not individually, and
that the obligations of such instrument are not binding upon any of them or the
Shareholders individually but are binding only upon the assets and property of
the Trust, or the particular Portfolio in question, as the case may be, but the
omission thereof shall not operate to bind any Trustees or Trustee or officers
or officer or Shareholders or Shareholder individually, or to subject the
Portfolio Assets of any Portfolio to the obligations of any other Portfolio.
SECTION 8.2. TRUSTEES' GOOD FAITH ACTION; EXPERT ADVICE; NO BOND OR SURETY.
The exercise by the Trustees of their powers and discretions hereunder shall be
binding upon everyone interested. Subject to Section 8.4 hereof, a Trustee shall
be liable for his own willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of
Trustee, and for nothing else, and shall not be liable for errors of judgment or
mistakes of fact or law. Subject to the foregoing, (i) the Trustees shall not be
responsible or liable in any event for any neglect or wrongdoing of any officer,
agent, employee, consultant, Investment Advisor, Administrator, Distributor or
Principal Underwriter, Custodian or Transfer Agent, Dividend Disbursing Agent,
Shareholder, Servicing Agent or Accounting Agent of the Trust, nor shall any
Trustee be responsible for the act or omission of any other Trustee; (ii) the
Trustees may take advice of counsel or other experts with respect to the meaning
and operation of this Declaration of Trust and their duties as Trustees, and
shall be under no liability for any act or omission in accordance with such
advice or for failing to follow such advice; and (iii) in discharging their
duties, the Trustees, when acting in good faith, shall be entitled to rely upon
the books of account of the Trust and upon written reports made to the Trustees
by any officer appointed by them, any independent public accountant, and (with
respect to the subject matter of the contract involved) any officer, partner or
<PAGE>
responsible employee of a Contracting Party appointed by the Trustees pursuant
to Section 5.2 hereof. The Trustees as such shall not be required to give any
bond or surety or any other security for the performance of their duties.
SECTION 8.3. INDEMNIFICATION OF SHAREHOLDERS. If any Shareholder (or former
Shareholder) of the Trust shall be charged or held to be personally liable for
any obligation or liability of the Trust solely by reason of being or having
been a Shareholder and not because of such Shareholder's acts or omissions or
for some other reason, the Trust (upon proper and timely request by the
Shareholder) shall assume the defense against such charge and satisfy any
judgment thereon, and the Shareholder or former Shareholder (or the heirs,
executors, administrators or other legal representatives thereof, or in the case
of a corporation or other entity, its corporate or other general successor)
shall be entitled (but solely out of the assets of the Portfolio of which such
Shareholder or former Shareholder is or was the holder of Shares) to be held
harmless from and indemnified against all loss and expense arising from such
liability.
SECTION 8.4. INDEMNIFICATION OF TRUSTEES, OFFICERS, ETC. Subject to the
limitations set forth hereinafter in this Section 8.4, the Trust shall indemnify
(from the assets of the Portfolio or Portfolios to which the conduct in question
relates) each of its Trustees and officers (including Persons who serve at the
Trust's request as directors, officers or trustees of another organization in
which the Trust has any interest as a shareholder, creditor or otherwise
[hereinafter, together with such Person's heirs, executors, administrators or
personal representative, referred to as a "Covered Person"]) against all
liabilities, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such Covered Person may be or may have
been threatened, while in office or thereafter, by reason of being or having
been such a Trustee or officer, director or trustee, except with respect to any
matter as to which it has been determined that such Covered Person (i) did not
act in good faith in the reasonable belief that such Covered Person's action was
in or not opposed to the best interests of the Trust or (ii) had acted with
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office (either and both
of the conduct described in (i) and (ii) being referred to hereafter as
"DISABLING CONDUCT"). A determination that the Covered Person is entitled to
indemnification may be made by (i) a final decision on the merits by a court of
other body before whom the proceeding was brought that the Covered Person to be
indemnified was not liable by reason of Disabling Conduct, (ii) dismissal of a
court action or an administrative proceeding against a Covered Person for
insufficiency of evidence of Disabling Conduct, or (iii) a reasonable
determination, based upon a review of the facts, that the indemnitee was not
<PAGE>
liable by reason Disabling Conduct by (a) a vote of a majority of a quorum of
Trustees who are neither "interested persons" of the Trust as defined in Section
2(a)(19) of the 1940 Act nor parties to the proceeding, or (b) an independent
legal counsel in a written opinion. Expenses including accountants' and counsel
fees so incurred by any such Covered Person (but excluding amounts paid in
satisfaction of judgments, in compromise or as fines or penalties), may be paid
from time to time by the Portfolio or Portfolios to which the conduct in
question related in advance of the final disposition of any such action, suit or
proceeding; PROVIDED, that the Covered Person shall have undertaken to repay the
amounts so paid to such Portfolio or Portfolios if it is ultimately determined
that indemnification of such expenses is not authorized under this Article VIII
and (i) the Covered Person shall have provided security for such undertaking,
(ii) the Trust shall be insured against losses arising by reason of any lawful
advances, or (iii) a majority of a quorum of the disinterested Trustees, or an
independent legal counsel in a written opinion, shall have determined, based on
a review of readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the Covered Person ultimately will be found
entitled to indemnification.
SECTION 8.5. COMPROMISE PAYMENT. As to any matter disposed of by a
compromise payment by any such Covered Person referred to in Section 8.4 hereof,
pursuant to a consent decree or otherwise, no such indemnification either for
said payment or for any other expenses shall be provided unless such
indemnification shall be approved (i) by a majority of a quorum of the
disinterested Trustees or (ii) by an independent legal counsel in a written
opinion. Approval by the Trustees pursuant to clause (i) or by independent legal
counsel pursuant to clause (ii) shall not prevent the recovery from any Covered
Person of any amount paid to such Covered Person in accordance with either of
such clauses as indemnification if such Covered persons is subsequently
adjudicated by a court of competent jurisdiction not to have acted in good faith
in the reasonable belief that such Covered Person's action was in or not opposed
to the best interests of the Trust or to have been liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Covered
Person's office.
SECTION 8.6. INDEMNIFICATION NOT EXCLUSIVE, ETC. The right of
indemnification provided by this Article VIII shall not be exclusive of or
affect any other rights to which any such Covered Person may be entitled. As
used in this Article VIII, a "DISINTERESTED" Person is one against whom none of
the actions, suits or other proceedings in question, and no other action, suit
or other proceeding on the same or similar grounds is then or has been pending
or threatened. Nothing contained in this Article VIII shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees and
officers, and other Persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such Person.
<PAGE>
SECTION 8.7. LIABILITY OF THIRD PERSONS DEALING WITH TRUSTEES. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees or to see to the
application of any payments made or property transferred to the Trust or upon
its order.
ARTICLE IX
DURATION, REORGANIZATION, AMENDMENTS
SECTION 9.1. DURATION AND TERMINATION OF TRUST. Unless terminated as
provided herein, the Trust shall continue without limitation of time and,
without limiting the generality of the foregoing, no change, alternation or
modification with respect to any Portfolio or Series of Shares shall operate to
terminate the Trust. The Trust may be terminated at any time by a Majority of
the Trustees, subject to the favorable vote of the holders of not less than a
majority of the Shares outstanding and entitled to vote of each Portfolio of the
Trust, or by an instrument or instruments in writing without a meeting,
consented to by the holders of not less than a majority of such Shares, or by
such greater or different vote of Shareholders of any Series as may be
established by the Certificate of Designation by which such Series was
authorized. Upon termination, after paying or otherwise providing for all
charges, taxes, expenses and liabilities, whether due to accrued or anticipated
as may be determined by the Trustees, the Trust shall in accordance with such
procedures as the Trustees consider appropriate reduce the remaining assets to
distributable form of cash, Securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with the
provisions of Section 6.2(d) hereof.
SECTION 9.2. REORGANIZATION. The Trustees may sell, convey and transfer all
or substantially all of the assets of the Trust, or the assets belonging to any
one or more Portfolios, to another trust, partnership, association or
corporation organized under the laws of any state of the United States, or may
transfer such assets to another Portfolio of the Trust, in exchange for cash,
Shares or other Securities (including, in the case of a transfer to another
Portfolio of the Trust, Shares of such other Portfolio), or to the extent
permitted by law then in effect may merge or consolidate the Trust or any
Portfolio with any other Trust or any corporation, partnership, or association
organized under the laws of any state of United States, all upon such terms and
conditions and for such consideration when and as authorized by vote or written
consent of a Majority of the Trustees and approved by the affirmative vote of
the holders of not less than a majority of the Shares outstanding and entitled
to vote of each Portfolio whose assets are affected by such termination, or by
an instrument or instruments in writing without a meeting, consented to by the
holders of not less than a majority of such Shares, and/or by such other vote of
any Series as may be established by the Certificate of Designation with respect
to such Series. Following such transfer, the Trustees shall distribute the cash,
<PAGE>
Shares or other Securities or other consideration received in such transaction
(giving due effect to the assets belonging to and indebtedness of, and any other
differences among, the various Portfolios of which the assets have so been
transferred) among the Shareholders of the Portfolio of which the assets have
been so transferred; and if all of the assets of the Trust have been so
transferred, the Trust shall be terminated. Nothing in this Section 9.2 shall be
construed as requiring approval of Shareholders for the Trustees or organize or
assist in organizing one or more corporations, trusts, partnerships,
associations or other organizations, and to sell, convey or transfer less than
substantially all of the Trust Property or the assets belonging to any Portfolio
to such organizations or entities.
SECTION 9.3. AMENDMENTS, ETC. All rights granted to the Shareholders under
this Declaration of Trust are granted subject to the reservation of the right to
amend this Declaration of Trust as herein provided, except that no amendment
shall repeal the limitations on personal liability of any Shareholder or Trustee
or the prohibition of assessment upon the Shareholders (otherwise than as
permitted under Section 6.2(h)) without the express consent of each Shareholder
or Trustee involved. Subject to the foregoing, the provisions of this
Declaration of Trust (whether or not related to the rights of Shareholders) may
be amended at any time, so long as such amendment does not adversely affect the
rights of any Shareholder with respect to which such amendment is or purports to
be applicable and so long as such amendment is not in contravention of
applicable law, including the 1940 Act, by an instrument in writing signed by a
Majority of the Trustees (or by an officer of the Trust pursuant to the vote of
a Majority of the Trustees). Any amendment to this Declaration of Trust that
adversely affects the rights of all Shareholders may be adopted at any time by
an instrument in writing signed by a Majority of the Trustees (or by an officer
of the Trust pursuant to a vote of a Majority of the Trustees) when authorized
to do so by the vote in accordance with Section 7.1 hereof of Shareholders
holding a majority of all the Shares outstanding and entitled to vote, without
regard to Series, or if said amendment adversely affects the rights of the
Shareholders of less than all of the Portfolios, by the vote of the holders of a
majority of all the Shares entitled to vote of each Portfolio so affected.
Subject to the foregoing, any such amendment shall be effective when the
instrument containing the terms thereof and a certificate (which may be a part
of such instrument) to the effect that such amendment has been duly adopted, and
setting forth the circumstances thereof, shall have been executed and
acknowledged by a Trustee or officer of the Trust and filed as provided in
Section 9.4 hereof.
SECTION 9.4. FILING OF COPIES OF DECLARATION AND AMENDMENTS. The original
or a copy of this Declaration and of each Amendment hereto (including each
Certificate of Designation and Certificate of Termination), as well as the
certificates called for by Section 4.1(k) hereof as to changes in the Trustees
shall be kept at the office of the Trust where it may be inspected by any
Shareholder, and one copy of each such instrument shall be filed with the
Secretary of The Commonwealth of Massachusetts, as well as with any other
<PAGE>
governmental office where such filing may from time to time be required by the
laws of Massachusetts. A restated Declaration, integrating into a single
instrument all of the provisions of this Declaration which are then in effect
and operative, may be executed from time to time by a Majority of the Trustees
and shall, upon filing with the Secretary of The Commonwealth of Massachusetts,
be conclusive evidence of all amendments contained therein and may thereafter be
referred to in lieu of the original Declaration and the various amendments
thereto.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. GOVERNING LAW. This Declaration of Trust is executed and
delivered in The Commonwealth of Massachusetts and with reference to the laws
thereof, and the rights of all parties and the construction and effect of every
provision hereof shall be subject to and construed according to the laws of said
Commonwealth.
SECTION 10.2. COUNTERPARTS. This Declaration of Trust and any amendment
thereto may be simultaneously executed in several counterparts, each of which so
executed shall be deemed to be an original, and such counterparts, together,
shall constitute but one and the same instrument, which shall be sufficiently
evidenced by any such original counterpart.
SECTION 10.3. RELIANCE BY THIRD PARTIES. Any certificate executed by an
individual who, according to the records in the office of the Secretary of The
Commonwealth of Massachusetts appears to be a Trustee hereunder, certifying to:
(a) the number or identity of Trustees or Shareholders, (b) the due
authorization of the execution of any instrument or writing, (c) the form of any
vote passed as a meeting of Trustees or Shareholders, (d) the fact that the
number of Trustees or Shareholders present at any meeting or executing any
written instrument satisfies the requirements of this Declaration of Trust, (e)
the form of any By-Law adopted, or the identity of any officers elected, by the
Trustees, or (f) the existence or non-existence of any fact or facts which in
any manner relate to the affairs of the Trust, shall be conclusive evidence as
to the matters so certified in favor of any Person dealing with the Trustees, or
any of them, and the successors of such Person.
SECTION 10.4. REFERENCES, HEADINGS. The masculine gender shall include the
feminine and neuter genders. Headings are placed herein for convenience of
reference only and shall not be taken as a part of this Declaration or control
or affect the meaning, construction or effect hereof.
SECTION 10.5. USE OF THE NAME "ALGER". Alger Associates, Inc. ("Alger") has
consented to the use by the Trust of the identifying name ("Alger"), which is a
property right of Alger. The Trust will only use the name "Alger" as a component
<PAGE>
of its name and for no other purpose, and will not purport to grant to any third
party the right to use the name "Alger" for any purpose. Alger or any corporate
affiliate of Alger may use or grant to others the right to use the name "Alger",
as all or a portion of a corporate or business name or for any commercial
purpose, including a grant of such right to any other investment company. At the
request of Alger, the Trust will take such action as may be required to provide
its consent to the use of such name by Alger, or any corporate affiliate of
Alger, or by any Person to whom Alger or an affiliate of Alger shall have
granted the right to the use of the name "Alger". Upon the termination of any
investment advisory or management agreement into which Alger and the Trust may
enter, the Trust shall, upon request by Alger, cease to use the name "Alger" as
a component of its name, and shall not use such name or initials as a part of
its name or for any other commercial purpose, and shall cause its officers and
Trustees to take any and all actions which Alger may request to effect the
foregoing and to reconvey, to Alger or such corporate affiliate any and all
rights to such name.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal, for
himself and his assigns, and has thereby accepted the Trusteeship as the initial
Trustee of The Alger Fund hereby granted and agreed to the provisions hereof,
all as of the day and year first above written.
/s/Bryan G. Tyson
--------------
Bryan G. Tyson
The undersigned Settler of The Alger Fund, hereby accepts, approves and
authorizes the foregoing Agreement and Declaration of Trust of The Alger Fund.
Date: March 20, 1986
/s/Peter C. Aseltine
---------------
Peter C. Aseltine
<PAGE>
ACKNOWLEDGMENTS
MASSACHUSETTS
Suffolk, ss:
March 20, 1986
Then personally appeared the above named Bryan G. Tyson and
acknowledged the foregoing instrument to be his free act and deed.
Before me,
/s/ Kathleen A. McSharry
-----------------------
Notary Public
MASSACHUSETTS
Suffolk, ss.:
March 20, 1986
Then personally appeared the above named Peter C. Aseltine and
acknowledged the foregoing instrument to be his free act and deed.
Before me,
/s/ Kathleen A. McSharry
-----------------------
Notary Public
Exhibit 1(b)
THE ALGER FUND
Certificate of Designation, Preferences and Rights of a Portfolio of Shares of
Beneficial Interest, and the Manner in Which the Same May Be Amended, of The
Alger Fund by Written Action of the Initial Trustee Providing for the
Establishment of a Portfolio Designated the "Alger High Yield Portfolio"
- ------------------------------------------------------------
The undersigned, being the Secretary of The Alger Fund (hereinafter referred to
as the "Trust"), a trust with transferable shares of the type commonly called a
Massachusetts business trust, DOES HEREBY CERTIFY:
That, pursuant to the authority conferred upon the Trustees of the Trust by
Section 6.1(b) of the Agreement and Declaration of Trust, dated March 20, 1986
(hereinafter referred to as the "Declaration of Trust"), and by the affirmative
vote of a Majority of the Trustees, there is hereby established and designated
the Alger High Yield Portfolio (hereinafter referred to as the "Alger High Yield
Portfolio"). The beneficial interest in the Alger High Yield Portfolio shall be
divided into Shares having a nominal or par value of one mill ($.001) per Share,
of which an unlimited number may be issued, which Shares shall represent
interests only in the Alger High Yield Portfolio. The Trustees shall have
authority from time to time to authorize separate Series of Shares for the Alger
High Yield Portfolio (each of which Series shall represent interests only in the
Alger High Yield Portfolio), as they deem necessary and desirable. The Shares of
the Alger High Yield Portfolio shall have the following relative rights and
preferences:
(a) ASSETS BELONGING TO THE ALGER HIGH YIELD PORTFOLIO. Any portion of
the Trust Property allocated to the Alger High Yield Portfolio, and all
consideration received by the Trust for the issue or sale of Shares of the
Alger High Yield Portfolio, together with all assets in which such
consideration is invested or reinvested, all interest, dividends, income,
earnings, profits and gains therefrom, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets, and
any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall be held by the Trustees in trust for
the benefit of the holders of Shares of the Alger High Yield Portfolio and
shall irrevocably belong to the Alger High Yield Portfolio for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of the Alger High Yield Portfolio shall not have, and
shall be conclusively deemed to have waived, any claims to the assets of
any Portfolio of which they are not Shareholders. Such consideration,
assets, interests, dividends, income, earnings, profits, gains and
proceeds, together with any General Items allocated to the Alger High Yield
Portfolio as provided in the following sentence, are herein referred to
collectively as "PORTFOLIO ASSETS" of the Alger High Yield Portfolio, and
as assets "BELONGING TO" the Alger High Yield Portfolio. In the event that
there are any assets, income, earnings, profits, and proceeds thereof,
funds, or payments which are not readily identifiable as belonging to any
particular Portfolio (collectively "GENERAL ITEMS"), the Trustees shall
allocate such General Items to and among any one or more of the Portfolios
established and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and equitable; and any
General Items so allocated to the Alger High Yield Portfolio shall belong
to and be part of the Portfolio Assets of the Alger High Yield Portfolio.
Each such allocation by the Trustees shall be conclusive and binding upon
the Shareholders of all Portfolios for all purposes.
(b) LIABILITIES OF THE ALGER HIGH YIELD PORTFOLIO. The assets
belonging to the Alger High Yield Portfolio shall be charged with the
liabilities in respect of the Alger High Yield Portfolio shall be charged
with the liabilities in respect of the Alger High Yield Portfolio and all
expenses, costs, charges and reserves attributable to the Alger High Yield
Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Portfolio shall be allocated and charged by the Trustees to
and among any one or more of the Portfolios established and designated from
time to time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Alger High Yield
Portfolio are herein referred to as "LIABILITIES OF" the Alger High Yield
Portfolio. Each allocation of liabilities, expenses, costs, charges and
reserves by the Trustees shall be conclusive and binding upon the
Shareholders of all Portfolios for all purposes. Any creditor of the Alger
High Yield Portfolio may look only to the assets of the Alger High
Portfolio to satisfy such creditor's debt. The Trust shall use their best
efforts to ensure that every note, bond, contract, instrument, certificate
or undertaking make or issued by the Trustees or by any officers or officer
shall give notice that the obligations of such instrument are binding only
upon the Portfolio Assets of the Alger High Yield Portfolio, and that any
creditor's acceptance or execution of such instrument shall constitute
agreement that such creditor shall look only to the assets and property of
the Alger High Yield Portfolio to satisfy the obligations of such
instrument.
<PAGE>
(c) DIVIDENDS. Dividends and distributions on Shares of the Alger High
Yield Portfolio may be paid with such frequency as the Trustees may
determine, which may be daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as the
Trustees may determine, to the Shareholders of the Alger High Yield
Portfolio, from such of the income, accrued or realized, and capital gains,
realized or unrealized, and out of the assets belonging to the Alger High
Yield Portfolio, as the Trustees may determine, after providing for actual
and accrued liabilities of the Alger High Yield Portfolio. All dividends
and distributions on Shares of the Alger High Yield Portfolio shall be
distributed pro rata to the Shareholders of the Alger High-Yield Portfolio
in proportion to the number of such Shares held by such holders at the date
and time of record established for the payment of such dividends or
distributions, except that in connection with any dividend or distribution
programs or procedure the Trustees may determine that no dividend or
distribution shall be payable on Shares as to which the Shareholder's
purchase order and/or payment have not been received by the time or times
established by the Trustees under such program or procedure, or that
dividends or distributions shall be payable on Shares which have been
tendered by the holder thereof for redemption or repurchase, but the
redemption or repurchase proceeds of which have not yet been paid to such
Shareholder. Such dividends and distributions may be made in cash or Shares
of the Alger High Yield Portfolio or a combination thereof as determined by
the Trustees, or pursuant to any program that the Trustees may have in
effect at the time for the election by each Shareholder of mode or the
making of such dividend or distribution to that Shareholder. Any such
dividend or distribution paid in Shares will be paid at the net asset value
thereof as determined in accordance with subsection (h) of this Certificate
of Designation.
(d) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Alger High Yield Portfolio shall be entitled
to receive, when and as declared by the Trustees, the excess of the
Portfolio Assets over the liabilities of the Alger High Yield Portfolio.
The assets so distributable to the Shareholders of the Alger High Yield
Portfolio shall be distributed among such Shareholders in proportion to the
number of Shares of the Alger High Yield Portfolio held by them and
recorded on the books of the Trust. The liquidation of the Alger High Yield
Portfolio may be authorized by vote of a Majority of the Trustees, subject
to the affirmative vote of "a majority of the outstanding voting
securities" of the Alger High Yield Portfolio, as the quoted phrase is
defined in the 1940 Act, determined in accordance with clause (iii) of the
definition of "MAJORITY SHAREHOLDER VOTE" in Section 1.4 of the Declaration
of Trust.
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article VII of the Declaration of Trust.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of the Alger High
Yield Portfolio shall have the right at such times as may be permitted by
the Trust, but no less frequently than once each week, to require the Trust
to redeem all or any part of his Shares of the Alger High Yield Portfolio
at a redemption price equal to the net asset value per Share of the Alger
High Yield Portfolio next determined in accordance with subsection (h) of
this Certificate of Designation after the Shares are properly tendered for
redemption; PROVIDED, that the Trustees may from time to time, in their
discretion, determine and impose a fee for such redemption. Payment of the
redemption price shall be in cash; PROVIDED, HOWEVER, that if the Trustees
determine, which determination shall be conclusive, that conditions exist
which make payment wholly in cash unwise or undesirable, the Trust may make
payment wholly or partly in Securities or other assets belonging to the
Alger High Yield Portfolio at the value of such Securities or assets used
in such determination of net asset value. Notwithstanding the foregoing,
the Trust may postpone payment of the redemption price and may suspend the
right of the holders of Shares of the Alger High Yield Portfolio to require
the Trust to redeem shares of the Alger High Yield Portfolio during any
period or at any time and to the extent permissible under the 1940 Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each share of the Alger
High Yield Portfolio shall be subject to redemption at ????? of the Trust
at the redemption price which would be applicable if the Shares were then
being redeemed by the Shareholder pursuant to subsection (f) of this
Certificate of Designation (f) at any time if the Trustees determine in
their sole discretion that failure ????? redeem may have materially adverse
consequences to the holders of the Shares of the Trust or of any Portfolio
or (ii) upon each other ?????? conditions with respect to maintenance of
Shareholder accounts of a minimum amount as may from time to time be
determined by the Trustees and set forth in the then current Prospectus of
the Alger High Yield Portfolio. Upon such redemption the holders of the
Shares so redeemed shall have no further right with respect thereto other
than to receive payment of such redemption price.
<PAGE>
(h) NET ASSET VALUE. The net asset value per Share of the Alger High
Yield Portfolio at any time shall be the quotient obtained by dividing the
value of the net assets of the High Yield Portfolio at such time (being the
current value of the assets belonging to the Alger High Yield Portfolio,
less its then existing liabilities by the total number of Shares of the
Alger High Yield Portfolio then outstanding, all determined in accordance
with the methods and procedures, including without limitation those with
respect to rounding, established by the Trustees from time to time. The
Trustees may determine to maintain the net asset value per Share of the
Alger High Yield Portfolio at a designated constant dollar amount and in
connection therewith may adopt procedures not inconsistent with the 1940
Act for the continuing declaration of income attributable to the Alger High
Yield Portfolio as dividends payable in additional shares of the Alger High
Yield Portfolio at the designated constant dollar amount and for the
handling of any losses attributable to the Alger High Yield Portfolio. Such
procedures may provide that in the event of any loss each Shareholder shall
be deemed to have contributed to the shares of beneficial interest account
of the Alger High Yield Portfolio his pro rata portion of the total number
of Shares required to be cancelled in order to permit the net asset value
per Share of the Alger High Yield Portfolio to be maintained, after
reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Alger High Yield Portfolio shall be deemed to have
expressly agreed by his investment in the Alger High Yield Portfolio, to
make the contribution referred to in the preceding sentence in the event of
any such loss and in the event of the adoption by the Trustees of any such
procedure with respect to the Alger High Yield Portfolio.
(i) TRANSFER. All Shares of the Alger High Yield Portfolio shall be
transferable, but transfers of Shares of the Alger High Yield Portfolio
will be recorded on the Share transfer records of the Trust applicable to
the Alger High Yield Portfolio only at such times as Shareholders shall
have the right to require the Trust to redeem shares of the Alger High
Yield Portfolio and at such other times as may be permitted by the
Trustees.
(j) EQUALITY. All Shares of the Alger High Yield Portfolio shall
represent an equal proportionate interest in the assets belonging to the
Alger High Yield Portfolio (subject to the liabilities of the Alger High
Yield Portfolio), and each Share of the Alger High Yield Portfolio shall be
equal to each other Share thereof; but the provisions of this sentence
shall not restrict any distinctions permissible under subsection (c) of
this Certificate of Designation that may exist with respect to dividends
and distributions on Shares of the Alger High Yield Portfolio. The Trustees
may from time to time divide or combine the Shares of the Alger High Yield
Portfolio into a greater or lesser number of Shares of the Alger High Yield
Portfolio without thereby changing the proportionate beneficial interest in
the assets belonging to the Alger High Yield Portfolio or in any way
affecting the rights of the holders of Shares of any other Portfolio.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share
of that Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Alger High Yield Portfolio.
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Alger High Yield Portfolio shall have the right to convert
said Shares into Shares of one or more other Portfolios in accordance with
such requirements and procedures as the Trustees may establish.
(m) AMENDMENT, ETC. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument signed in
writing by a majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), provided that, if any
amendment adversely affects the rights of the Shareholders of the Alger
High Yield Portfolio, such amendment may be adopted by an instrument in
writing signed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees) when authorized to do
so by the vote in accordance with Section 7.1 of the Declaration of Trust
of the holders of a majority of all the Shares of the Alger High Yield
Portfolio outstanding and entitled to vote, without regard to Series.
(n) INCORPORATION OF DEFINED TERMS. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of State of The
Commonwealth of Massachusetts. The Trustees further direct that, upon the
execution of these resolutions, the Trust take all necessary action to file
a copy of this Certificate of Designation with the Secretary of State of
The Commonwealth of Massachusetts and at any other place required by law or
by the Declaration of Trust. IN WITNESS WHEREOF, the undersigned has set
his hand and seal this 11 day of September, 1986.
/s/ George J. Boggio
---------------------
George J. Boggio
<PAGE>
ACKNOWLEDGMENT
STATE OF NEW YORK )
) :ss
COUNTY OF NEW YORK )
On this 11th day of September, 1986, before me personally appeared George
J. Boggio, to me known and known to me to be the person described in and who
executed the foregoing Certificate of Designation as Secretary of The Alger
Fund, as stated therein, and he acknowledged that he executed the same as his
free act and deed, and that he is the Secretary now in office of The Alger Fund.
Before me,
/s/ Cynthia M. Harney
---------------------
Notary
[NOTARIAL SEAL]
CYNTHIA M. HARNEY
NOTARY PUBLIC STATE OF NEW YORK
No. 31-4677867
Certified in New York County
Commission Expires Nov. 30, 1988
Exhibit 1(c)
THE ALGER FUND
Certificate of Designation, Preferences and Rights of a Portfolio of Shares of
Beneficial Interest, and the Manner in which the Same May Be Amended, of The
Alger Fund by Written Action of the Initial Trustee Providing for the
Establishment of a Portfolio Designated the "Alger Income and Growth Portfolio".
The undersigned, being the Secretary of The Alger Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY:
That, pursuant to the authority conferred upon the Trustees of the Trust by
Section 6.1(b) of the Agreement and Declaration of Trust, dated. March 20, 1986
(hereinafter referred to as the "Declaration of Trust"), and by the affirmative
vote of a Majority of the Trustees, there is hereby established and designated
the Alger Income and Growth Portfolio (hereinafter referred to as the "Alger
Income and Growth Portfolio"). The beneficial interest in the Alger Income and
Growth Portfolio shall be divided into Shares having a nominal or par value of
one mill ($.001) per Share, of which an unlimited number may be issued, which
Shares shall represent interests only in the Alger Income and Growth Portfolio.
The Trustees shall have authority from time to time to authorize separate Series
of Shares for the Alger Income and Growth Portfolio (each of which Series shall
represent interests only in the Alger Income and Growth Portfolio), as they deem
necessary and desirable. The Shares of the Alger Income and Growth Portfolio
shall have the following relative rights and preferences:
(a) ASSETS BELONGING TO THE ALGER INCOME AND GROWTH PORTFOLIO. Any
portion of the Trust Property allocated to the Alger Income and Growth
Portfolio, and all consideration received by the Trust for the issue or
sale of Shares of the Alger Income and Growth Portfolio, together with all
assets in which such consideration is invested or reinvested, all interest,
dividends, income, earnings, profits and gains therefrom, and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be
held by the Trustees in trust for the benefit of the holders of Shares of
the Alger Income and Growth Portfolio and shall irrevocably belong to the
Alger Income and Growth Portfolio for all purposes, and shall be so
recorded upon the books of account of the Trust, and the Shareholders of
the Alger Income and Growth Portfolio shall not have, and shall be
conclusively deemed to have waived, any claims to the assets of any
Portfolio of which they are not Shareholders. Such consideration, assets,
interest, dividends income, earnings, profits, gains and proceeds, together
with any General Items allocated to the Alger Income and Growth Portfolio
as provided in the following sentence, are herein referred to collectively
as "PORTFOLIO ASSETS" the Alger Income and Growth Portfolio, and as assets
"belonging to" the Alger Income and Growth Portfolio. In the event that
there are any assets, income, earnings, profits and proceeds thereof,
funds, or payments which are not readily identifiable as belonging to any
particular Portfolio (collectively "GENERAL ITEMS"), the Trustees shall
<PAGE>
allocate such General Items to and among any one or more of the Portfolios
established and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and equitable; and any
General Items so allocated, to the Alger Income and Growth Portfolio shall
belong to and be part of the Portfolio Assets of the Alger Income and
Growth Portfolio. Each such allocation by the Trustees shall be conclusive
and binding upon the Shareholders of all Portfolios for all purposes.
(b) LIABILITIES OF THE ALGER INCOME AND GROWTH PORTFOLIO. The assets
belonging to the Alger Income and Growth Portfolio shall be charged with
the liabilities in respect of the Alger Income and Growth Portfolio and all
expenses, costs, charges and reserves attributable to the Alger Income and
Growth Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Portfolio shall be allocated and charged by the Trustees to
and among any one or more of the Portfolios established and designated from
time to time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Alger Income and
Growth Portfolio are herein referred to as "LIABILITIES OF" the Alger
Income and Growth Portfolio. Each allocation of liabilities, expenses,
costs, charges and reserves by the Trustees shall be conclusive and binding
upon the Shareholders of all Portfolios for all purposes. Any creditor of
the Alger Income and Growth Portfolio may look only to the assets of the
Alger Income and Growth Portfolio to satisfy such creditor's debt. The
Trustees shall use their best efforts to ensure that every note, bond,
contract, instrument, certificate or undertaking made or issued by the
Trustees or by any officers or officer shall give notice that the
obligations of such instrument are binding only upon the Portfolio Assets
of the Alger Income and Growth Portfolio, and that any creditor's
acceptance or execution of such instrument shall constitute agreement that
such creditor shall look only to the assets and property of the Alger
Income and Growth Portfolio to satisfy the obligator of such instrument.
(c) DIVIDENDS. Dividends and distributions on Shares of the Alger
Income and Growth Portfolio may be paid with such frequency as the Trustees
may determine, which may be daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as the
Trustees may determine, to the Shareholders of the Alger Income and Growth
Portfolio, from such of the income, accrued or realized, and capital gains,
realized or unrealized, and out of the assets belonging to the Alger Income
and Growth Portfolio, as the Trustees may determine after providing for
actual and accrued liabilities of the Alger Income and Growth Portfolio.
All dividends and distributions on Shares of the Alger Income and Growth
Portfolio shall be distributed pro rata to the Shareholders of the Alger
Income and Growth Portfolio in proportion to the number of such Shares held
by such holders at the date and time of record established for the payment
<PAGE>
of such dividends or distributions, except that in accordance with any
dividend or distribution program or procedure the Trustees may determine
that no dividend or distribution shall be payable on shares as to which the
Shareholder's purchase order and/or ????? been received by the time or
times established by the Trustees under which program or procedure, or that
dividends or distributions shall be payable on Shares which have been
tendered by the holder thereof for redemption or repurchase, but the
redemption or repurchase proceeds of which have not yet been paid to such
Shareholder. Such dividends and distributions may be made in cash or Shares
of the Alger Income and Growth Portfolio or a combination thereof as
determined by the Trustees, or pursuant to any program that the Trustees
may have in effect at the time for the election by each Shareholder of the
mode of the making of such dividend or distribution to that Shareholder.
Any such dividend or distribution paid in Shares will be paid at the net
asset value thereof as determined in accordance with subsection (h) of this
Certificate of Designation.
(d) LIQUIDATION. In the event of this liquidation or dissolution of
the Trust, the Shareholders of the Alger Income and Growth Portfolio shall
be entitled to receive, when and as declared by the Trustees, the excess of
the Portfolio Assets over the liabilities of the Alger Income and Growth
Portfolio. The assets so distributable to the Shareholders of the Alger
Income and Growth Portfolio shall be distributed among such Shareholders in
proportion to the number of Shares of the Alger Income and Growth Portfolio
held by them and recorded on the books of the Trust. The liquidation of the
Alger Income and Growth Portfolio may be authorized by vote of a Majority
of the Trustees, subject to the affirmative vote of "a majority of the
outstanding voting securities" of the Alger Income and Growth Portfolio, as
the quoted phrase is defined in the 1940 Act, determined in accordance with
clause (iii) of the definition of "MAJORITY SHAREHOLDER VOTE" in Section
1.4 of the Declaration of Trust.
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article VII of the Declaration of Trust.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of the Alger
Income and Growth Portfolio shall have the right at such times as may be
permitted by the Trust, but no less frequently than once each week, to
require the Trust to redeem all or any part of his Shares of the Alger
Income and Growth Portfolio at a redemption price equal to the net asset
value per Share of the Alger Income and Growth Portfolio next determined in
accordance with subsection (h) of this Certificate of Designation after the
Shares are properly tendered for redemption; provided, that the Trustees
may from time to time, in their discretion, determine and impose a fee for
such redemption. Payment of the redemption price shall be in cash;
PROVIDED, HOWEVER, that if the Trustees determine, which determination
shall be conclusive, that conditions exist which make payment wholly in
cash unwise or undesirable, the Trust may make payment wholly or partly in
<PAGE>
Securities or other assets belonging to the Alger Income and Growth
Portfolios at the value of such Securities or assets used in such
determination of net asset value. Notwithstanding the foregoing, the Trust
may propose payment of the redemption price and may suspend the right-of
the holders of Shares of the Alger Income and Growth Portfolio to require
the Trust to redeem Shares of the Alger Income and Growth Portfolio during
any period or at any time when and to the extent permissible under the 1940
Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each Share of the Alger
Income and Growth Portfolio shall be subject to redemption at the option of
the Trust at the redemption price which would be applicable if such Share
were then being redeemed by the Shareholder pursuant to subsection (f) of
this Certificate of Designation. (i) at any time, if the Trustees determine
in their sole discretion that failure to so redeem may have materially
adverse consequences to the holders of the Shares of the Trust or of any
Portfolio or (ii) upon such other conditions with respect to maintenance of
Shareholder accounts of a minimum amount as may from time to time be
determined by the Trustees and set forth in the then current Prospectus of
the Alger Income and Growth Portfolio. Upon such redemption the holders of
the Shares so redeemed shall have no further right with respect thereto
other than to receive payment of such redemption price.
(h) NET ASSET VALUE. The net asset value per Share of the Alger Income
and Growth Portfolio at any time shall be the quotient obtained by dividing
the value of the net assets of the Alger Income and Growth Portfolio at
such time (being the current value of the assets belonging to the Alger
Income and Growth Portfolio, less its then existing liabilities) by the
total number of Shares of the Alger Income and Growth Portfolio then
outstanding, all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by
the Trustees from time to time. The Trustees may determine to maintain the
net asset value per Share of the Alger Income and Growth Portfolio at a
designated constant dollar, amount and in connection therewith may adopt
procedures not inconsistent with the 1940 Act for the continuing
declaration of income attributable to the Alger Income and Growth Portfolio
as dividends payable in additional Shares of the Alger Income and Growth
Portfolio at the designated constant dollar amount and for the handling of
any losses attributable to the Alger Income and Growth Portfolio. Such
procedures may provide that in the event of any loss each Shareholder shall
be deemed to have contributed to the shares of beneficial interest account
of the Alger Income and Growth Portfolio his pro rata portion of the total
number of Shares required to be cancelled in order to permit the net asset
value per Share of the Alger Income and Growth Portfolio to be maintained,
after reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Alger Income and Growth Portfolio shall be deemed to
have expressly agreed, by his investment in the Alger Income and Growth
Portfolio, to make the contribution referred to in the preceding sentence
<PAGE>
in the event of any such loss and in the event of the adoption by the
Trustees of any such procedure with respect to the Alger Income and Growth
Portfolio.
(i) TRANSFER. All Shares of the Alger Income and Growth Portfolio
shall be transferable, but transfers of Shares of the Alger Income and
Growth Portfolio will be recorded on the Share transfer records of the
Trust applicable to the Alger Income and Growth Portfolio only at such
times as Shareholders shall have the right to require the Trust to redeem
Shares of the Alger Income and Growth Portfolio and at such other times as
may be permitted by the Trustees.
(j) EQUALITY. All Shares of the Alger Income and Growth Portfolio
shall represent an equal proportionate interest in the assets belonging to
the Alger Income and Growth Portfolio (subject to the liabilities of the
Alger Income and Growth Portfolio), and each Share of the Alger Income and
Growth Portfolio shall be equal to each other Share thereof; but the
provisions of this sentence shall not restrict any distinctions permissible
under subsection (c) of this Certificate of designation that may exist with
respect to dividends and distributions on Shares of the Alger Income and
Growth Portfolio. The Trustees may from time to time divide or combine the
Shares of the Alger Income and Growth Portfolio into a greater or lesser
number of Shares of the Alger Income and Growth Portfolio without thereby
changing the proportionate beneficial interest in the assets belonging to
the Alger Income and Growth Portfolio or, in any way affecting the rights
of the holders of Shares of any other Portfolio.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share
of that Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Alger Income and Growth Portfolio.
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Alger Income and Growth Portfolio shall have the right to
convert said Shares into Shares of one or more other Portfolios in
accordance with such requirements and procedures as the Trustees may
establish.
(m) AMENDMENT, ETC. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument signed in
writing by a majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), PROVIDED THAT, if any
amendment adversity affects the rights of the Shareholders of the Alger
Income and Growth Portfolio, such amendment may be adopted by an instrument
in writing signed by a Majority of the Trustees (or by an officer of the
Trust pursuant to the vote of a Majority of the Trustees) when authorized
<PAGE>
to do so by the vote in accordance with Section 7.1 of the Declaration of
Trust of the holders of a majority of all the Shares of the Alger Income
and Growth Portfolio outstanding and entitled to vote, without regard to
Series.
(n) INCORPORATION OF DEFINED TERMS. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filled with the Secretary of State of The
Commonwealth of Massachusetts.
The Trustees further direct that, upon the execution of these resolutions,
the Trust take all necessary action to file a copy of this Certificate of
Designation with the Secretary of State of The Commonwealth of Massachusetts and
at any other place required by law or by the Declaration of Trust.
IN WITNESS WHEREOF, the undersigned has set his hand and seal this 11 day
of September, 1986.
/s/George J. Boggio
--------------------
George J. Boggio
<PAGE>
ACKNOWLEDGMENT
STATE OF NEW YORK)
COUNTY OF NEW YORK) :ss
On this 11th day of September, 1986, before me personally appeared George
J. Boggio, to me known and known to me to be the person described in and who
executed the foregoing Certification of Designation as Secretary of The Alger
Fund, as stated therein, and he acknowledged that he executed the same as his
free act and deed, and that he is the Secretary now in office of The Alger Fund.
Before me,
/s/ Cynthia M. Harney
Notary Public
[NOTARIAL SEAL]
CYNTHIA M. HARNEY
NOTARY PUBLIC STATE OF NEW YORK
No. 31-4677357
Qualified in New York County
Commission Expires Nov. 30, 1988
Exhibit 1(d)
THE ALGER FUND
CERTIFICATE OF DESIGNATION
The undersigned, being the Secretary of The Alger Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated March
20, 1986 (hereinafter referred to as the "Declaration of Trust"), and by the
affirmative vote of a Majority of the Trustees at a meeting duly called and held
on March 19, 1992 the Declaration of Trust is amended as follows:
(1) There is hereby established and designated the Alger Balanced Portfolio
(hereinafter referred to as the "Alger Balanced Portfolio"). The beneficial
interest in the Alger Balanced Portfolio shall be divided into Shares having a
nominal or par value of one mill ($.001) per Share, of which an unlimited number
may be issued, which Shares shall represent interests only in the Alger Balanced
Portfolio. The Trustees shall have authority from time to time to authorize
separate Series of Shares for the Alger Balanced Portfolio (each of which Series
shall represent interests only in the Alger Balanced Portfolio), as they deem
necessary and desirable. The Shares of the Alger Balanced Portfolio shall have
the following rights and preferences:
(a) ASSETS BELONGING TO THE ALGER BALANCED PORTFOLIO. Any portion of
the Trust Property allocated to the Alger Balanced Portfolio, and all
consideration received by the Trust for the issue or sale of Shares of the
Alger Balanced Portfolio, together with all assets in which such
consideration is invested or reinvested, all interest, dividends, income,
earnings, profits and gains therefrom, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets, and
any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall be held by the Trustees in trust for
the benefit of the holders of Shares of the Alger Balanced Portfolio and
shall irrevocably belong to the Alger Balanced Portfolio for all purposes,
and shall be so recorded upon the books of account of the Trust, and the
Shareholders of any other Fund who are not Shareholders of the Alger
Balanced Portfolio shall not have, and shall be conclusively deemed to have
waived, any
<PAGE>
claims to the assets of the Alger Balanced Portfolio. Such consideration,
assets, interest, dividends, income, earnings, profits, gains and proceeds,
together with any General Items allocated to the Alger Balanced Portfolio
as provided in the following sentence, are herein referred to collectively
as "FUND ASSETS" of the Alger Balanced Portfolio, and as assets "BELONGING
TO" the Alger Balanced Portfolio. In the event that there are any assets,
income, earnings, profits, and proceeds thereof, funds, or payments which
are not readily identifiable as belonging to any particular Fund
(collectively "GENERAL ITEMS"), the Trustees shall allocate such General
Items to and among any one or more of the Funds established and designated
from time to time in such manner and on such basis as they, in their sole
discretion, deem fair and equitable; and any General Items so allocated to
the Alger Balanced Portfolio shall belong to and be part of the Fund Assets
of the Alger Balanced Portfolio. Each such allocation by the Trustees shall
be conclusive and binding upon the Shareholders of all the Funds for all
purposes.
(b) LIABILITIES OF THE ALGER BALANCED PORTFOLIO. The assets belonging
to the Alger Balanced Portfolio shall be charged with the liabilities in
respect of the Alger Balanced Portfolio and all expenses, costs, charges
and reserves attributable to the Alger Balanced Portfolio, and any general
liabilities, expenses, costs, charges or reserves of the Trust which are
not readily identifiable as pertaining to any particular Fund shall be
allocated and charged by the Trustees to and among any one or more of the
Funds established and designated from time to time in such manner and on
such basis as the Trustees in their sole discretion deem fair and
equitable. The indebtedness, expenses, costs, charges and reserves
allocated and so charged to the Alger Balanced Portfolio are herein
referred to as "LIABILITIES OF" the Alger Balanced Portfolio. Each
allocation of liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon the Shareholders of all the
Funds for all purposes. Any creditor of the Alger Balanced Portfolio may
look only to the assets of the Alger Balanced Portfolio to satisfy such
creditor's debt.
(c) DIVIDENDS. Dividends and distributions on Shares of the Alger
Balanced Portfolio may be paid with such frequency as the Trustees may
determine, which may be daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency
<PAGE>
as the Trustees may determine, to the Shareholders of the Alger Balanced
Portfolio, from such of the income, accrued or realized, and capital gains,
realized or unrealized, and out of the assets belonging to the Alger
Balanced Portfolio, as the Trustees may determine, after providing for
actual and accrued liabilities of the Alger Balanced Portfolio. All
dividends and distributions on Shares of the Alger Balanced Portfolio shall
be distributed pro rata to the Shareholders of the Alger Balanced Portfolio
in proportion to the number of such Shares held by such holders at the date
and time of record established for the payment of such dividends or
distributions, except that in connection with any dividend or distribution
program or procedure the Trustees may determine that no dividend or
distribution shall be payable on Shares as to which the Shareholder's
purchase order and/or payment have not been received by the time or times
established by the Trustees under such program or procedure, or that
dividends or distributions shall be payable on Shares which have been
tendered by the holder thereof for redemption or repurchase, but the
redemption or repurchase proceeds of which have not yet been paid to such
Shareholder. Such dividends and distributions may be made in cash or Shares
of the Alger Balanced Portfolio or a combination thereof as determined by
the Trustees, or pursuant to any program that the Trustees may have in
effect at the time for the election by each Shareholder of the mode of the
making of such dividend or distribution to that Shareholder. Any such
dividend or distribution paid in Shares will be paid at the net asset value
thereof as determined in accordance with subsection (h) hereof.
(d) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Alger Balanced Portfolio shall be entitled
to receive, when and as declared by the Trustees, the excess of the Fund
Assets over the liabilities of the Alger Balanced Portfolio. The assets so
distributable to the Shareholders of the Alger Balanced Portfolio shall be
distributed among such Shareholders in proportion to the number of Shares
of the Alger Balanced Portfolio held by them and recorded on the books of
the Trust. The liquidation of the Alger Balanced Portfolio may be
authorized by vote of a Majority of the Trustees, subject to the
affirmative vote of "a majority of the outstanding voting securities" of
the Alger Balanced Portfolio, as the quoted phrase is defined in the 1940
Act, determined in accordance with clause (iii) of the definition of
"Majority Shareholder Vote" in Section 1.4 of the Declaration of Trust.
<PAGE>
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of the Alger
Balanced Portfolio shall have the right at such times as may be permitted
by the Trust, but no less frequently than once each week, to require the
Trust to redeem all or any part of his Shares of the Alger Balanced
Portfolio at a redemption price equal to the net asset value per Share of
the Alger Balanced Portfolio next determined in accordance with subsection
(h) hereof after the Shares are properly tendered for redemption; PROVIDED,
that the Trustees may from time to time, in their discretion, determine and
impose a fee for such redemption. Payment of the redemption price shall be
in cash; PROVIDED, HOWEVER, that if the Trustees determine, which
determination shall be conclusive, that conditions exist which make payment
wholly in cash unwise or undesirable, the Trust may make payment wholly or
partly in Securities or other assets belonging to the Alger Balanced
Portfolio at the value of such Securities or assets used in such
determination of net asset value. Notwithstanding the foregoing, the Trust
may postpone payment of the redemption price and may suspend the right of
the holders of Shares of the Alger Balanced Portfolio to require the Trust
to redeem Shares of the Alger Balanced Portfolio during any period or at
any time when and to the extent permissible under the 1940 Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each Share of the Alger
Balanced Portfolio shall be subject to redemption at the option of the
Trust at the redemption price which would be applicable if such Share were
then being redeemed by the Shareholder pursuant to subsection (f) hereof:
(i) at any time, if the Trustees determine in their sole discretion that
failure to so redeem may have materially adverse consequences to the
holders of the Shares of the Trust or of any Fund, or (ii) upon such other
conditions with respect to maintenance of Shareholder accounts of a minimum
amount as may from time to time be determined by the Trustees and set forth
in the then current Prospectus of the Alger Balanced Portfolio. Upon such
redemption the holders of the Shares so redeemed shall have no further
right with respect thereto other than to receive payment of such redemption
price.
(h) NET ASSET VALUE. The net asset value per Share of the Alger
Balanced Portfolio at any time shall be the quotient obtained by dividing
<PAGE>
the value of the net assets of the Alger Balanced Portfolio at such time
(being the current value of the assets belonging to the Alger Balanced
Portfolio, less its then existing liabilities) by the total number of
Shares of the Alger Balanced Portfolio then outstanding, all determined in
accordance with the methods and procedures, including without limitation
those with respect to rounding, established by the Trustees from time to
time. The Trustees may determine to maintain the net asset value per Share
of the Alger Balanced Portfolio at a designated constant dollar amount and
in connection therewith may adopt procedures not inconsistent with the 1940
Act for the continuing declaration of income attributable to the Alger
Balanced Portfolio as dividends payable in additional Shares of the Alger
Balanced Portfolio at the designated constant dollar amount and for the
handling of any losses attributable to the Alger Balanced Portfolio. Such
procedures may provide that in the event of any loss each Shareholder shall
be deemed to have contributed to the shares of beneficial interest account
of the Alger Balanced Portfolio his pro rata portion of the total number of
Shares required to be cancelled in order to permit the net asset value per
Share of the Alger Balanced Portfolio to be maintained, after reflecting
such loss, at the designated constant dollar amount. Each Shareholder of
the Alger Balanced Portfolio shall be deemed to have expressly agreed, by
his investment in the Alger Balanced Portfolio, to make the contribution
referred to in the preceding sentence in the event of any such loss.
(i) TRANSFER. All Shares of the Alger Balanced Portfolio shall be
transferable, but transfers of Shares of the Alger Balanced Portfolio will
be recorded on the Share transfer records of the Trust applicable to the
Alger Balanced Portfolio only at such times as Shareholders shall have the
right to require the Trust to redeem Shares of the Alger Balanced Portfolio
and at such other times as may be permitted by the Trustees.
(j) EQUALITY. All Shares of the Alger Balanced Portfolio shall
represent an equal proportionate interest in the assets belonging to the
Alger Balanced Portfolio (subject to the liabilities of the Alger Balanced
Portfolio), and each Share of the Alger Balanced Portfolio shall be equal
to each other Share thereof; but the provisions of this sentence shall not
restrict any distinctions permissible under subsection (c) hereof that may
exist with respect to dividends and distributions on Shares of the Alger
Balanced Portfolio. The Trustees may from time to time divide or combine
the Shares of the Alger Balanced Portfolio into a greater or lesser number
<PAGE>
of Shares of the Alger Balanced Portfolio without thereby changing the
proportionate beneficial interest in the assets belonging to the Alger
Balanced Portfolio or in any way affecting the rights of the holders of
Shares of any other Fund.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractionalShare of any Series
shall carry proportionately all the rights and obligations of a whole Share
of that Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Alger Balanced Portfolio.
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Alger Balanced Portfolio shall have the right to convert
said Shares into Shares of one or more other Funds in accordance with such
requirements and procedures as the Trustees may establish.
(m) AMENDMENT, ETC. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument signed in
writing by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), PROVIDED THAT, if any
amendment adversely affects the rights of the Shareholders of the Alger
Balanced Portfolio, such amendment may be adopted by an instrument signed
in writing by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees) when authorized to do
so by the vote in accordance with Section 7.1 of the Declaration of Trust
of the holders of a majority of all the Shares of the Alger Balanced
Portfolio outstanding and entitled to vote.
(n) INCORPORATION OF DEFINED TERMS. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of the
Commonwealth of Massachusetts.
<PAGE>
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place require by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 19th day
of March, 1992.
/s/Nanci K. Staple
------------------
Nanci K. Staple
Secretary
<PAGE>
ACKNOWLEDGMENT
State of New York )
) :ss
County of New York)
March 19, 1992
Then personally appeared the above named Nanci K. Staple and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
/s/ DOLORES M. COSTA
Notary Public, State of New York
No. 24-4941104
Qualified in King County
Commission Expires 8/15/92
Exhibit 1(e)
THE ALGER FUND
CERTIFICATE OF DESIGNATION
The undersigned, being the Secretary of The Alger Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.l(b) and Section 9.3 of the Agreement and Declaration of Trust, dated March
20, 1986, as amended March 19, 1992 (hereinafter referred to as the "Declaration
of Trust"), and by the affirmative vote of a Majority of the Trustees at a
meeting duly called and held on February 24, 1993 the Declaration of Trust is
amended as follows:
(1) There is hereby established and designated the Alger MidCap Growth
Portfolio thereinafter referred to as the "Alger MidCap Growth Portfolio").
The beneficial interest in the Alger MidCap Growth Portfolio shall be
divided into Shares having a nominal or par value of one mill ($.001) per
Share, of which an unlimited number may be issued, which Shares shall
represent interests only in the Alger MidCap Growth Portfolio. The Trustees
shall have authority from time to time to authorize separate Series of
Shares for the Alger MidCap Growth Portfolio (each of which Series shall
represent interests only in the Alger MidCap Growth Portfolio), as they
deem necessary and desirable. The Shares of the Alger MidCap Growth
Portfolio shall have the following rights and preferences:
(a) ASSETS BELONGING TO THE ALGER MIDCAP GROWTH PORTFOLIO. Any portion
of the Trust Property allocated to the Alger MidCap Growth Portfolio, and
all consideration received by the Trust for the issue or sale of Shares of
the Alger MidCap Growth Portfolio, together with all assets in which such
consideration is invested or reinvested, all interest, dividends, income,
earnings, profits and gains therefrom, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets, add
any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall be held by the Trustees in trust for
the benefit of the holders of Shares of the Alger MidCap Growth Portfolio
and shall irrevocably belong to the Alger MidCap Growth Portfolio for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of any other Fund who are not Shareholders of the
<PAGE>
Alger MidCap Growth Portfolio shall not have, and shall be conclusively
deemed to have waived, any claims to the assets of the Alger MidCap Growth
Portfolio. Such consideration, assets, interest, dividends, income,
earnings, profits, gains and proceeds, together with any General Items
allocated to the Alger MidCap Growth Portfolio as provided in the following
sentence, are herein referred to collectively as "FUND ASSETS" of the Alger
MidCap Growth Portfolio, and as assets "BELONGING TO" the Alger MidCap
Growth Portfolio. In the event that there are any assets, income, earnings,
profits, and proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular Fund (collectively "GENERAL
ITEMS"), the Trustees shall allocate such General Items to and among any
one or more of the Funds established and designated from time to time in
such manner and on such basis as they, in their sole discretion, deem fair
and equitable; and any General Items so allocated to the Alger MidCap
Growth Portfolio shall belong to and be part of the Fund Assets of the
Alger MidCap Growth Portfolio. Each such allocation by the Trustees shall
be conclusive and binding upon the Shareholders of all the Funds for all
purposes.
(b) LIABILITIES OF THE ALGER MIDCAP GROWTH PORTFOLIO. The assets
belonging to the Alger MidCap Growth Portfolio shall be charged with the
liabilities in respect of the Alger MidCap Growth Portfolio and all
expenses, costs, charges and reserves attributable to the Alger MidCap
Growth Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Fund shall be allocated and charged by the Trustees to and
among any one or more of the Funds established and designated from time to
time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Alger MidCap Growth
Portfolio are herein referred to as "LIABILITIES OF" the Alger MidCap
Growth Portfolio. Each allocation of liabilities, expenses, costs, charges
and reserves by the Trustees shall be conclusive and binding upon the
Shareholders of all the Funds for all purposes. Any creditor of the Alger
MidCap Growth Portfolio may look only to the assets of the Alger MidCap
Growth Portfolio to satisfy such creditor's debt.
(c) DIVIDENDS. Dividends and distributions on Shares of the Alger
MidCap Growth Portfolio may be paid with such frequency as the Trustees may
<PAGE>
determine, which may be daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as the
Trustees may determine, to the Shareholders of the Alger MidCap Growth
Portfolio, from such of the income, accrued or realized, and capital gains,
realized or unrealized, and out of the assets belonging to the Alger MidCap
Growth Portfolio, as the Trustees may determine, after providing for actual
and accrued liabilities of the Alger MidCap Growth Portfolio. All dividends
and distributions on Shares of the Alger MidCap Growth Portfolio shall be
distributed pro rata to the Shareholders of the Alger MidCap Growth
Portfolio in proportion to the number of such Shares held by such holders
at the date and time of record established for the payment of such
dividends or distributions, except that in connection with any dividend or
distribution program or procedure the Trustees may determine that no
dividend or distribution shall be payable on Shares as to which the
Shareholder's purchase order and/or payment have not been received by the
time or times established by the Trustees under such program or procedure,
or that dividends or distributions shall be payable on Shares which have
been tendered by the holder thereof for redemption or repurchase, but the
redemption or repurchase proceeds of which have not yet been paid to such
Shareholder. Such dividends and distributions may be made in cash or Shares
of the Alger MidCap Growth Portfolio or a combination thereof as determined
by the Trustees, or pursuant to any program that the Trustees may have in
effect at the time for the election by each Shareholder of the mode of the
making of such dividend or distribution to that Shareholder. Any such
dividend or distribution paid in Shares will be paid at the net asset value
thereof as determined in accordance with subsection (h) hereof.
(d) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Alger MidCap Growth Portfolio shall be
entitled to receive, when and as declared by the Trustees, the excess of
the Fund Assets over the liabilities of the Alger MidCap Growth Portfolio.
The assets so distributable to the Shareholders of the Alger MidCap Growth
Portfolio shall be distributed among such Shareholders in proportion to the
number of Shares of the Alger MidCap Growth Portfolio held by them and
recorded on the books of the Trust. The liquidation of the Alger MidCap
Growth Portfolio may be authorized by vote of a Majority of the Trustees,
subject to the affirmative vote of "a majority of the outstanding voting
securities" of the Alger MidCap Growth Portfolio, as the quoted phrase is
defined in the 1940 Act, determined in accordance with clause (iii) of the
definition of "MAJORITY SHAREHOLDER VOTE" in Section 1.4 of the Declaration
of Trust.
<PAGE>
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of the Alger
MidCap Growth Portfolio shall have the right at such times as may be
permitted by the Trust, but no less frequently than once each week, to
require the Trust to redeem all or any part of his Shares of the Alger
MidCap Growth Portfolio at a redemption price equal to the net asset value
per Share of the Alger MidCap Growth Portfolio next determined in
accordance with subsection (h) hereof after the Shares are properly
tendered for redemption; PROVIDED, that the Trustees may from time to time,
in their discretion, determine and impose a fee for such redemption.
Payment of the redemption price shall be in cash; PROVIDED, HOWEVER, that
if the Trustees determine, which determination shall be conclusive, that
conditions exist which make payment wholly in cash unwise or undesirable,
the Trust may make payment wholly or partly in Securities or other assets
belonging to the Alger MidCap Growth Portfolio at the value of such
Securities or assets used in such determination of net asset value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of the
Alger MidCap Growth Portfolio to require the Trust to redeem Shares of the
Alger MidCap Growth Portfolio during any period or at any time when and to
the extent permissible under the 1940 Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each Share of the Alger
MidCap Growth Portfolio shall be subject to redemption at the option of the
Trust at the redemption price which would be applicable if such Share were
then being redeemed by the Shareholder pursuant to subsection (f) hereof:
(i) at any time, if the Trustees determine in their sole discretion that
failure to so redeem may have materially adverse consequences to the
holders of the Shares of the Trust or of any Fund, or (ii) upon such other
conditions with respect to maintenance of Shareholder accounts of a minimum
amount as may from time to time be determined by the Trustees and set forth
in the then current Prospectus of the Alger MidCap Growth Portfolio. Upon
such redemption the holders of the Shares so redeemed shall have no further
right with respect thereto other than to receive payment of such redemption
price.
<PAGE>
(h) NET ASSET VALUE. The net asset value per Share of the Alger MidCap
Growth Portfolio at any time shall be the quotient obtained by dividing the
value of the net assets of the Alger MidCap Growth Portfolio at such time
(being the current value of the assets belonging to the Alger MidCap Growth
Portfolio, less its then existing liabilities) by the total number of
Shares of the Alger MidCap Growth Portfolio then outstanding, all
determined in accordance with the methods and procedures, including without
limitation those with respect to rounding, established by the Trustees from
time to time. The Trustees may determine to maintain the net asset value
per Share of the Alger MidCap Growth Portfolio at a designated constant
dollar amount and in connection therewith may adopt procedures not
inconsistent with the 1940 Act for the continuing declaration of income
attributable to the Alger MidCap Growth Portfolio as dividends payable in
additional Shares of the Alger MidCap Growth Portfolio at the designated
constant dollar amount and for the handling of any losses attributable to
the Alger MidCap Growth Portfolio. Such procedures may provide that in the
event of any loss each Shareholder shall be deemed to have contributed to
the shares of beneficial interest account of the Alger MidCap Growth
Portfolio his pro rata portion of the total number of Shares required to be
cancelled in order to permit the net asset value per Share of the Alger
MidCap Growth Portfolio to be maintained, after reflecting such loss, at
the designated constant dollar amount. Each Shareholder of the Alger MidCap
Growth Portfolio shall be deemed to have expressly agreed, by his
investment in the Alger MidCap Growth Portfolio, to make the contribution
referred to in the preceding sentence in the event of any such loss.
(i) TRANSFER. All Shares of the Alger MidCap Growth Portfolio shall be
transferable, but transfers of Shares of the Alger MidCap Growth Portfolio
will be recorded on the Share transfer records of the Trust applicable to
the Alger MidCap Growth Portfolio only at such times as Shareholders shall
have the right to require the Trust to redeem Shares of the Alger MidCap
Growth Portfolio and at such other times as may be permitted by the
Trustees.
(j) EQUALITY. All Shares of the Alger MidCap Growth Portfolio shall
represent an equal proportionate interest in the assets belonging to the
Alger MidCap Growth Portfolio(subject to the liabilities of the Alger
MidCap Growth Portfolio), and each Share of the Alger MidCap Growth
Portfolio shall be equal to each other Share thereof; but the provisions of
this sentence shall not restrict any distinctions permissible under
<PAGE>
subsection (c) hereof that may exist with respect to dividends and
distributions on Shares of the Alger MidCap Growth Portfolio. The Trustees
may from time to time divide or combine the Shares of the Alger MidCap
Growth Portfolio into a greater or lesser number of Shares of the Alger
MidCap Growth Portfolio without thereby changing the proportionate
beneficial interest in the assets belonging to the Alger MidCap Growth
Portfolio or in any way affecting the rights of the holders of Shares of
any other Fund.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share
of that Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Alger MidCap Growth Portfolio.
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Alger MidCap Growth Portfolio shall have the right to
convert said Shares into Shares of one or more other Funds in accordance
with such requirements and procedures as the Trustees may establish.
(m) AMENDMENT, ETC. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument signed in
writing by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), PROVIDED THAT, if any
amendment adversely affects the rights of the Shareholders of the Alger
MidCap Growth Portfolio, such amendment may be adopted by an instrument
signed in writing by a Majority of the Trustees (or by an officer of the
Trust pursuant to the vote of a Majority of the Trustees) when authorized
to do so by the vote in accordance with Section 7.1 of the Declaration of
Trust of the holders of a majority of all the Shares of the Alger MidCap
Growth Portfolio outstanding and entitled to vote.
(n) INCORPORATION OF DEFINED TERMS. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of the
Commonwealth of Massachusetts.
<PAGE>
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 24th day
of February, 1993.
/s/Nanci K. Staple
----------------------------
Nanci K. Staple
Secretary
<PAGE>
ACKNOWLEDGMENT
STATE OF NEW YORK )
) :ss
COUNTY OF NEW YORK )
February 24, 1993
Then personally appeared the above named Nanci K. Staple and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
/s/ Dolores M. Costa
---------------------------------
DOLORES M. COSTA
Notary Public, State of New York
No. 31-4941104
Qualified in New York County
Commission Expires 8/15/94
Exhibit 1(f)
THE ALGER FUND
CERTIFICATE OF DESIGNATION
The undersigned, being the Secretary of The Alger Fund (hereinafter
referred top as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated March
20, 1986, as amended March 19, 1992 (hereinafter referred to as the "Declaration
of Trust"), and by the affirmative vote of a Majority of the Trustees at a
meeting duly called and held on August 13, 1993 the Declaration of Trust is
amended as follows:
(1) There is hereby established and designated the Alger Leveraged AllCap
Portfolio (hereinafter referred to as the "Portfolio"). The beneficial interest
in the Portfolio shall be divided into Shares having a nominal or par value of
one mill ($.001) per Share, of which an unlimited number may be issued, which
Shares shall represent interests only in the Portfolio. The Trustees shall have
authority from time to time to authorize separate Series of Shares for the
Portfolio (each of which Series shall represent interests only in the
Portfolio), as they deem necessary and desirable. The Shares of the Portfolio
shall have the following rights and preferences:
(a) ASSETS BELONGING TO THE PORTFOLIO. Any portion of the Trust
Property allocated to the Portfolio, and all consideration received by the
Trust for the issue or sale of Shares of the Portfolio, together with all
assets in which such consideration is invested or reinvested, all interest,
dividend, income, earnings, profits and gains therefrom, and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be
held by the Trustees in trust for the benefit of the holders of Shares of
the Portfolio and shall irrevocably belong to the Portfolio for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of any other Fund who are not Shareholders of the
Portfolio shall not have, and shall be conclusively deemed to have waived,
any claims to the assets of the Portfolio. Such consideration, assets,
interest, dividends, income, earnings, profits, gains and proceeds,
<PAGE>
together with any General Items allocated to the Portfolio as provided in
the following sentence, are herein referred to collectively as "FUND
ASSETS" of the Portfolio, and as assets "BELONGING TO" the Portfolio. In
the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Fund (collectively "GENERAL ITEMS"), the
Trustees shall allocate such General Items to and among any one or more of
the Funds established and designated from time to time in such manner and
on such basis as they, in their sole discretion, deem fair and equitable;
and any General Items so allocated to the Portfolio shall belong to and be
part of the Fund Assets of the Portfolio. Each such allocation by the
Trustees shall be conclusive and binding upon the Shareholders of all the
Funds for all purposes.
(b) LIABILITIES OF THE PORTFOLIO. The assets belonging to the
Portfolio shall be charged with the liabilities in respect of the Portfolio
and all expenses, costs, charges and reserves attributable to the
Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Fund shall be allocated and charged by the Trustees to and
among any one or more of the Funds established and designated from time to
time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Portfolio are herein
referred to as "LIABILITIES OF" the Portfolio. Each allocation of
liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all the Funds for all
purposes. Any creditor of the Portfolio may look only to the assets of the
Portfolio to satisfy such creditor's debt.
(c) DIVIDENDS. Dividends and distributions on Shares of the Portfolio
may be paid with such frequency as the Trustees may determine, which may be
daily or otherwise pursuant to a standing resolution or resolutions adopted
only once or with such frequency as the Trustees may determine, to the
Shareholders of the Portfolio, from such of the income, accrued or
realized, and capital gains, realized or unrealized, and out of the assets
belonging to the Portfolio, as the Trustees may determine, after providing
for actual and accrued liabilities of the Portfolio. All dividends and
distributions on Shares of the Portfolio shall be distributed pro rata to
the Shareholders of the Portfolio in proportion to the number of such
shares held by such holders at the date and time of record established for
<PAGE>
the payment of such dividends or distributions, except that in connection
with any dividend or distribution program or procedure the Trustees may
determine that no dividend or distribution shall be payable on Shares as to
which the Shareholder's purchase order and/or payment have not been
received by the time or times established by the Trustees under such
program or procedure, or that dividends and distributions shall be payable
on Shares which have been tendered by the holder thereof for redemption or
repurchase, but the redemption or repurchase proceeds of which have not yet
been paid to such Shareholder. Such dividends and distributions may be made
in cash or Shares of the Portfolio or a combination thereof as determined
by the Trustees, or pursuant to any program that the Trsutees may have in
effect at the time for the election by each Shareholder of the mode of the
making of such dividend or distribution to that Shareholder. Any such
dividend or distribution to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with subsection (h) hereof.
(d) LIQUIDATION. In the event of the liquidation or dissolution of
the Trust, the Shareholders of the Portfolio shall be entitled to receive,
when and as declared by the Trustees, the excess of the Fund Assets over
the liabilities of the Portfolio. The assets so distributed among such
Shareholders in proportion to the number of Shares of the Portfolio held
by them and recorded on the books of the Trust. The liquidation of the
Portfolio may be authorized by voice of a Majority of the Trustees,
subject to the affirmative vote of "a majority of the outstanding voting
securities" of the Portfolio, as the quoted phrase is defined in the 1940
Act, determined in accordance with clause (iii) of the definition of
"MAJORITY SHAREHOLDER VOTE" in Section 1.4 of the Declaration of Trust.
(e) VOTING. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of the Portfolio
shall have the right at such times as may be permitted by the Trust, but no
less frequently than once each week, to require the Trust to redeem all or
any pact of his Shares of the Portfolio at a redemption price equal to the
net asset value per Share of the Portfolio next determined in accordance
with subsection (h) hereof after the Shares are properly tendered for
redemption; PROVIDED, that the Trustees may from time to time in their
<PAGE>
discretion, determine and impose a fee for such redemption. Payment of the
redemption price shall be in cash; PROVIDED, HOWEVER, that if the Trustees
determine, which determination shall be conclusive, that conditions exist
which make payment wholly in cash unwise or undesirable, the Trust may make
payment wholly or partly in Securities or other assets belonging to the
Portfolio at the value of such Securities or assets used in such
determination of net asset value. Notwithstanding the foregoing, the Trust
may postpone payment of the redemption price and may suspend the right of
the holders of Shares of the Portfolio to require the Trust to redeem
Shares of the Portfolio during any period or at any time when and to the
extent permissible under the 1940 Act.
(g) REDEMPTION AT THE OPTION OF THE TRUST. Each Share of the Portfolio
shall be subject to redemption at the option of the Trust at the redemption
price which would be applicable if such Share were then redeemed by the
Shareholder pursuant to subsection (f) hereof: (i) at any time, if the
Trustees determine in their sole discretion that failure to so redeem may
have materially adverse consequences to the holders of the Shares of the
Trust or of any Fund, or (ii) upon such other conditions with respect to
maintenance of Shareholder accounts of a minimum amount as may from time to
time be determined by the Trustees and set forth in the then current
Prospectus of the Portfolio. Upon such redemption the holders of the Shares
so redeemed shall have no further right with respect thereto other than to
receive payment of such redemption price.
<PAGE>
(h) NET ASSET VALUE. The net asset value per Share of the Portfolio at
any time shall be the quotient obtained by dividing the value of the net
assets of the Portfolio at such time (being the current value of the assets
belonging to the Portfolio, less its then existing liabilities) by the
total number of Shares of the Portfolio then outstanding, all determined in
accordance with the methods and procedures, including without limitation
those with respect to rounding, established by the Trustees from time to
time. The Trustees may determine to maintain the net asset value per Share
of the Portfolio at a designated constant dollar amount and in connection
therewith may adopt procedures not inconsistent with the 1940 Act for the
continuing declaration of income attributable to the Portfolio as dividends
payable in additional Shares of the Portfolio at the designated constant
dollar amount and for the handling of any losses attributable to the
Portfolio. Such procedures may provide that in the event of any loss each
<PAGE>
Shareholder shall be deemed to have contributed to the shares of beneficial
interest account of the Portfolio his pro rata portion of the total number
of Shares required to be cancelled in order to permit the net asset value
per Share of the Portfolio to be maintained, after reflecting such loss, at
the designated constant dollar amount. Each Shareholder of the Portfolio
shall be deemed to have expressly agreed, by his investment in the
Portfolio, to make the contribution referred to in the preceding sentence
in the event of any such loss.
(i) TRANSFER. All Shares of the Portfolio shall be transferable, but
transfers of Shares of the Portfolio will be recorded on the Share transfer
records of the Trust applicable to the Portfolio only at such times as
Shareholders shall have the right to require the Trust to redeem Shares of
the Portfolio and at such other times as may be permitted by the Trustees.
(j) EQUALITY. All Shares of the Portfolio shall represent an equal
proportionate interest in the assets belonging to the Portfolio (subject to
the liabilities of the Portfolio), and each Share of the Portfolio shall be
equal to each other Share thereof; but the provisions of this sentence
shall not restrict any distinctions permissible under subsection (c) hereof
that may exist with respect to dividends and distributions on Shares of the
Portfolio. The Trustees may from time to time divide or combine the Shares
of the Portfolio into a greater or lesser number of Shares of the Portfolio
without thereby changing the proportionate beneficial interest in the
assets belonging to the Portfolio or in any way affecting the rights of the
holders of Shares of any Fund.
(k) RIGHTS OF FRACTIONAL SHARES. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share
of that Series, including rights and obligations with respect to voting,
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Portfolio.
(l) CONVERSION RIGHTS. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Portfolios shall have the right to convert said Shares
into Shares of one or more other Funds in accordance with such requirements
and procedures as the Trustees may establish.
(m) AMENDMENTS, etc., Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
<PAGE>
Certificate of Designation may be amended by an instrument signed in
writing by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees PROVIDED THAT, if any
amendment adversely affects the rights of the Shareholders of the
Portfolio, such amendment may be adopted by an instrument signed in writing
by a Majority of the Trustees (or by an officer of the Trust pursuant to
the vote of a majority of the Trustees) when authorized to do so by the
vote in accordance with Section 7.1 of the Declaration of Trust of the
holders of a majority of all the Shares of the Portfolio outstanding and
entitled to vote.
(n) INCORPORATION OF DEFINED TERMS. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of the
Commonwealth of Massachusetts.
<PAGE>
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of the Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 16th day
of August, 1993.
/s/ Nanci K. Staple
---------------------
Nanci K. Staple
Secretary
ACKNOWLEDGMENT
STATE OF NEW YORK )
) ss
COUNTY OF NEW YORK )
August 16, 1993
Then personally appeared the above named Nanci K. Staple and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
/s/ Louise M. Ulitto
--------------------
Louise M. Ulitto
Louise M. Ulitto
Notary Public, State of New York
No. XX-XXXXXXX
Qualified in New York County
Commission Expires January 31, 1995
Exhibit 1(g)
THE ALGER FUND
CERTIFICATE OF AMENDMENT
The undersigned, being the Secretary of the Alger Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that
pursuant to the authority conferred upon the Trustees of the Trust by Section
9.3 of the Agreement and Declaration of Trust, dated March 20, 1986, as amended
(as so amended, referred to as the "Declaration of Trust"), and by the
affirmative vote of a Majority of the Trustees at a meeting duly called and held
on December 7, 1994, the Certificate of Designation, dated August 16, 1993,
establishing the "Alger Leveraged AllCap Portfolio" of the Trust is hereby
amended to change the name of such Portfolio to be the "Alger Capital
Appreciation Portfolio."
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 27th day
of March 1995.
/s/ Nanci K. Staple
----------------
Secretary
ACKNOWLEDGEMENT
STATE OF NEW YORK )
) :ss
COUNTY OF NEW YORK )
March 27, 1995
Then personally appeared the above-named Nanci K. Staple and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
Dolores M. Costa
--------------
Notary Public
My commission expires: 8/15/96
[NOTARIAL SEAL]
DOLORES M. COSTA
Notary Public, State of New York
No. 31-4941104
Qualified in New York County
Commission Expires 8/15/96
Exhibit 1(h)
THE ALGER FUND
CERTIFICATE OF TERMINATION
OF
THE ALGER INCOME AND GROWTH PORTFOLIO
The undersigned, being the duly elected and qualified Secretary of The
Alger Fund a trust with transferable shares under the laws of Massachusetts (the
"Trust") authorized to establish one or more series funds, which was organized
pursuant to an Agreement and Declaration of Trust dated March 20, 1986 (as
amended to date the "Declaration"). DOES HEREBY CERTIFY that:
1. Pursuant to Section 6.1 of the Declaration, at a meeting of the
Trustees of the Trust duly called and held on February 15, 1995, at which a
quorum was present and acting, the said Trustees adopted resolutions, a
copy of which is attached hereto approving the liquidation of The Alger
Income and Growth Portfolio of the Trust, after which The Alger Income and
Growth Portfolio would be terminated.
2. Thereafter, at a meeting of the shareholders of The Alger Income
and Growth Portfolio duly called and held on April 17, 1995, at which a
quorum was present and acting, the holders of not less than a majority of
the shares of beneficial interest of the Portfolio outstanding and entitled
to vote, voted to approve the liquidation and the transactions called for
thereby, including the termination of the Portfolio.
3. Thereafter, the Portfolio wound up its business and affairs, and
the assets of the Portfolio remaining after, were distributed to the
shareholders of the Portfolio, in conformity with Section 6.2(d) of the
Declaration. NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS that pursuant
to Section 9.1 of the Declaration the Portfolio be, and it is hereby,
TERMINATED, effective immediately upon the filing of a copy of this
Certificate with the office of the Secretary of State of The Commonwealth
of Massachusetts.
IN WITNESS WHEREOF, the undersigned has hereunto set his/her hand on the
date set opposite his/her signature below.
/s/ Nanci K. Staple
----------------
Dated: May 23, 1995 Secretary
<PAGE>
ACKNOWLEDGEMENT
STATE OF New York )
) :ss
COUNTY OF New York )
March 17, 1995
Then personally appeared the above-named Nanci K. Staple and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
Dolores M. Costa
--------------
Notary Public
My commission expires: 8/15/96
[NOTARIAL SEAL]
DOLORES M. COSTA
Notary Public, State of New York
No. 31-4941104
Qualified in New York County
Commission Expires 8/15/96
Exhibit 2
- --------------------------------------------------------------------------------
THE ALGER FUND
By-Laws
- --------------------------------------------------------------------------------
THE ALGER FUND
By-Laws
INDEX
PAGE NO.
RECITALS.......................................................................1
ARTICLE I - SHAREHOLDERS AND SHAREHOLDERS'
MEETINGS...............................................1
Section 1.1 Meetings...............................................1
Section 1.2 Presiding Officer; Secretary...........................1
Section 1.3 Authority of Chairman of Meetings to
Interpret Declaration and By-Laws......................1
Section 1.4 Voting; Quorum.........................................1
Section 1.5 Inspectors.............................................2
Section 1.6 Shareholders' Action in Writing........................2
ARTICLE II-TRUSTEES AND TRUSTEES' MEETINGS.....................................2
Section 2.1 Number of Trustees.....................................2
Section 2.2 Meetings of Trustees...................................2
Section 2.3 Quorum; Presiding Officer..............................3
Section 2.4 Participation by Telephone.............................3
Section 2.5 Location of Meetings...................................3
Section 2.6 Votes..................................................3
Section 2.7 Rulings by Chairman....................................3
Section 2.8 Trustees' Action in Writing............................3
Section 2.9 Resignations...........................................3
<PAGE>
ARTICLE III - OFFICERS .......................................................3
Section 3.1 Officers of the Trust..................................3
Section 3.2 Time and Terms of Election.............................4
Section 3.3 Resignation and Removal................................4
Section 3.4 Fidelity Bond..........................................4
Section 3.5 Chairman of the Trustees...............................4
Section 3.6 Vice Chairmen..........................................4
Section 3.7 President..............................................4
Section 3.8 Vice Presidents........................................5
Section 3.9 Treasurer and Assistant Treasurers.....................5
Section 3.10 Controller and Assistant Controllers...................5
Section 3.11 Secretary and Assistant Secretaries....................5
Section 3.12 Substitutions..........................................6
Section 3.13 Execution of Deeds, etc................................6
Section 3.14 Power to Vote Securities...............................6
ARTICLE IV - COMMITTEES .......................................................6
Section 4.1 Power of Trustees to Designate
Committees...........................................6
Section 4.2 Rules for Conduct of Committee Affairs.................7
Section 4.3 Trustees may Alter, Abolish, etc.,
Committees...........................................7
Section 4.4 Minutes; Review by Trustees............................7
ARTICLE V - SEAL .......................................................7
<PAGE>
ARTICLE VI - SHARES .......................................................7
Section 6.1 Share Certificates.....................................7
Section 6.2 Lost, Stolen, etc., Certificates.......................8
Section 6.3 Record Transfer of Pledged Shares......................8
ARTICLE VII - AMENDMENTS.......................................................8
Section 7.1 By-Laws Subject to Amendment...........................8
Section 7.2 Notice of Proposal to Amend By-Laws
Required.............................................9
<PAGE>
THE ALGER FUND
BY-LAWS
These Articles are the By-Laws of The Alger Fund, a trust with transferable
shares established under the laws of The Commonwealth of Massachusetts (the
"Trust"), pursuant to an Agreement and Declaration of Trust of the Trust (the
"Declaration") made the 20th day of March, 1986, and filed in the office of the
Secretary of the Commonwealth. These By-Laws have been adopted by the Trustees
pursuant to the authority granted by Section 3.1(x) of the Declaration.
All words and terms capitalized in these By-Laws, unless otherwise defined
herein, shall have the same meanings as they have in the Declaration.
ARTICLE I
SHAREHOLDERS AND SHAREHOLDERS' MEETINGS
SECTION 1.1. MEETINGS. The annual meeting of Shareholders shall be held
within six (6) months of the end of each fiscal year, commencing with the end of
the first full fiscal year, at such time, on such day and at such place as the
Trustees may from time to time determine. A meeting of the Shareholders of the
Trust shall also be held whenever called by any member of the Executive
Committee (if one has been established) or by a majority of the Trustees then in
office in accordance with Section 9.1(b) of the Declaration. Notice of
Shareholders' meetings shall be given as provided in the Declaration.
SECTION 1.2. PRESIDING OFFICER; SECRETARY. The President, or in his absence
the Chairman of the Trustees, or in the absence of the President and the
Chairman, the Vice Chairman or Chairmen, if any, in the order of their seniority
or as the Trustees shall otherwise determine, shall preside at each
Shareholders' meeting as chairman of the meeting, or in the absence of the
President, the Chairman and all Vice Chairmen, the Trustees present at the
meeting shall elect one of their number as chairman of the meeting. Unless
otherwise provided for by the Trustees, the Secretary of the Trust shall be the
secretary of all meetings of Shareholders and shall record the minutes thereof.
SECTION 1.3. AUTHORITY OF CHAIRMAN OF MEETING TO INTERPRET DECLARATION AND
BY-LAWS. At any Shareholders' meeting the chairman of the meeting shall be
empowered to determine the construction or interpretation of the Declaration or
these By-Laws, or any part thereof or hereof, and his ruling shall be final.
SECTION 1.4. VOTING; QUORUM. At each meeting of Shareholders, except as
otherwise provided by the Declaration, every holder of record of Shares entitled
to vote shall be entitled to a number of votes equal to the number of Shares
standing in his name on the Share register of the Trust.
<PAGE>
Shareholders may vote by proxy and the form of any such proxy may be prescribed
from time to time by the Trustees. A quorum shall exist if the holders of a
majority of the outstanding Shares of the Trust entitled to vote without regard
to Series, are present in person or by proxy, but any lesser number shall be
sufficient for adjournments. At all meetings of the Shareholders, votes shall be
taken by ballot for all matters which may be binding upon the Trustees pursuant
to Section 6.3 of the Declaration. On other matters, votes of Shareholders need
not be taken by ballot unless otherwise provided for by the Declaration or by
vote of the Trustees, but the chairman of the meeting may in his discretion
authorize any matter to be voted upon by ballot.
SECTION 1.5. INSPECTORS. At any meeting of Shareholders, the chairman of
the meeting may appoint one or more Inspectors of Election or Balloting to
supervise the voting at such meeting or any adjournment thereof. If Inspectors
are not so appointed, the chairman of the meeting may, and on the request of any
Shareholder present or represented and entitled to vote shall, appoint one or
more Inspectors for such purpose. Each Inspector, before entering upon the
discharge of his duties, shall take and sign an oath faithfully to execute the
duties of Inspector of Election or Balloting, as the case may be, at such
meeting with strict impartiality and according to the best of his ability. If
appointed, Inspectors shall take charge of the polls and, when the vote is
completed, shall make a certificate of the result of the vote taken and of such
other facts as may be required by law.
SECTION 1.6. SHAREHOLDERS' ACTION IN WRITING. Nothing in this Article I
shall limit the power of the Shareholders to take any action by means of written
instruments without a meeting, as permitted by Section 9.6 of the Declaration.
ARTICLE II
TRUSTEES AND TRUSTEES' MEETINGS
SECTION 2.1. NUMBER OF TRUSTEES. There shall initially be two (2) Trustees,
and the number of Trustees shall thereafter be such number, authorized by the
Declaration, as from time to time shall be fixed by a vote adopted by a majority
of the Trustees then in office.
SECTION 2.2. MEETINGS OF TRUSTEES. An annual meeting of the Trustees shall
be held immediately following the annual meeting of Shareholders, or the
execution of any consent in lieu of such a meeting. Other meetings of the
Trustees shall be called in accordance with Section 10.6 of the Declaration at
such time, on such day and at such place as shall be designated by the notice
provided for therein. Notice of each Trustees' meeting shall be mailed or
delivered to the last known address of each Trustee entitled to such notice, or
to such other address as may have been specified by such Trustee to the
Secretary. Written notices need not be manually signed. Unless otherwise
<PAGE>
specified in the notice, and except as provided in Section 7.2 of these By-Laws,
any and all business may be transacted at any Trustees' meeting.
SECTION 2.3 QUORUM; PRESIDING OFFICER. At any meeting of the Trustees, a
majority of the Trustees then in office shall constitute a quorum. Any meeting
may be adjourned from time to time by a majority of the votes cast upon the
question, whether or not a quorum is present, and the meeting may be held as
adjourned without further notice. Unless the Trustees shall otherwise elect,
generally or in a particular case, the President, or in the absence the
Chairman, shall preside at each meeting of the Trustees as chairman of the
meeting or in the absence of the President and the Chairman, the Trustees
present at the meeting shall elect one of their number as chairman of the
meeting.
SECTION 2.4. PARTICIPATION BY TELEPHONE. One or more of the Trustees may
participate in a meeting thereof or of any Committee of the Trustees by means of
a conference telephone or similar communications equipment allowing all persons
participating in the meeting to hear each other at the same time. Participation
by such means shall constitute presence in person at a meeting.
SECTION 2.5. LOCATION OF MEETINGS. Trustees' meetings may be held at any
place, within or without Massachusetts.
SECTION 2.6. VOTES. Voting at Trustees' meetings may be conducted orally,
by show of hands, or, if requested by any Trustee, by written ballot. The
results of all voting shall be recorded by the Secretary in the minute book.
SECTION 2.7. RULINGS OF CHAIRMAN. All other rules of conduct adopted and
used at any Trustees' meeting shall be determined by the chairman of such
meeting, whose ruling on all procedural matters shall be final.
SECTION 2.8. TRUSTEES' ACTION IN WRITING. Nothing in this Article II shall
limit the power of the Trustees to take action by means of a written instrument
without a meeting, as provided in Section 10.6 of the Declaration.
SECTION 2.9. RESIGNATIONS. Any Trustee may resign at any time by written
instrument signed by him and delivered to the Chairman, the President or the
Secretary or to a meeting of the Trustees. Such resignation shall be effective
upon receipt unless specified to be effective at some other time.
ARTICLE III
OFFICERS
SECTION 3.1. OFFICERS OF THE TRUST. The officers of the Trust shall consist
of a Chairman of the Trustees, a President, a Treasurer and a Secretary, and may
<PAGE>
include one or more Vice Chairmen, Vice Presidents, Assistant Treasurers and
Assistant Secretaries, and such other officers as the Trustees may designate.
Any person may hold more than one office. Except for the Chairman, the President
and any Vice Chairmen, no officer need be a Trustee.
SECTION 3.2. TIME AND TERMS OF ELECTION. The Chairman, the President, the
Treasurer and the Secretary shall be elected by the Trustees at their first
meeting and thereafter at the annual meeting of the Trustees, as provided in
Section 10.6 of the Declaration. Such officers shall hold office until the next
annual meeting of the Trustees and until their successors shall have been duly
elected and qualified, and may be removed at any meeting by the affirmative vote
of a majority of the Trustees then in office. All other officers of the Trust
may be elected or appointed at any meeting of the Trustees. Such officers shall
hold office for any term, or indefinitely, as determined by the Trustees, and
shall be subject to removal, with or without cause, at any time by the Trustees.
SECTION 3.3. RESIGNATION AND REMOVAL. Any officer may resign at any time by
giving written notice to the Trustees. Such resignation shall take effect at the
time specified therein, and, unless otherwise specified therein, the acceptance
of such resignation shall not be necessary to make it effective. If the office
of any officer or agent becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the Trustees may
choose a successor, who shall hold office for the unexpired term in respect of
which such vacancy occurred. Except to the extent expressly provided in a
written agreement with the Trust, no officer resigning or removed shall have any
right to any compensation for any period following such resignation or removal,
or any right to damage on account of such removal.
SECTION 3.4. FIDELITY BOND. The Trustees may, in their discretion, direct
any officer appointed by them to furnish at the expense of the Trust a fidelilty
bond approved by the Trustees, in such amount as the Trustees may prescribe.
SECTION 3.5. CHAIRMAN OF THE TRUSTEES. The Chairman of the Trustees shall
preside in the absence of the President at meetings of the Shareholders and
meetings of the Trustees and shall have, subject to the supervision of the
Trustees, such other powers and duties as the Trustees may prescribe.
SECTION 3.6. VICE CHAIRMEN. If the Trustees shall elect one or more Vice
Chairmen, the Vice Chairman or if there shall be more than one, such Vice
Chairmen in the order of their seniority or as otherwise designated by the
Trustees, shall exercise such powers and duties of the Chairman as the Trustees
shall determine.
SECTION 3.7. PRESIDENT. The President shall be the chief executive officer
of the Trust and, subject to the supervision of the Trustees, shall have general
<PAGE>
charge of the operations of the Trust and general supervision of the personnel
of the Trust, and such other powers and duties as the Trustees shall prescribe.
SECTION 3.8. VICE PRESIDENTS. In the absence or disability of the
President, the Vice President or, if there shall be more than one, the Vice
Presidents in the order of their seniority or as otherwise designated by the
Trustees, shall exercise all of the powers and duties of the President. The Vice
Presidents shall have the power to execute bonds, notes, mortgages and other
contracts, agreements and instruments in the name of the Trust, and shall do and
perform such other duties as the Trustees or the President shall direct.
SECTION 3.9. TREASURER AND ASSISTANT TREASURERS. The Treasurer shall be the
chief financial officer of the Trust, and shall have the custody of the Trust's
funds and Securities, and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Trust and shall deposit all moneys, and
other valuable effects in the name and to the credit of the Trust, in such
depositories as may be designated by the Trustees, taking proper vouchers for
such disbursements, shall have such other duties and powers as may be prescribed
from time to time by the Trustees or the Treasurer, and shall be responsible to
and shall report to the Treasurer. In the absence or disability of the
Treasurer, the Assistant Treasurer or, if there shall be more than one, the
Assistant Treasurers in the order of their seniority or as otherwise designated
by the Trustees, shall have the powers and duties of the Treasurer.
SECTION 3.10. CONTROLLER AND ASSISTANT CONTROLLERS. If a Controller is
elected, he shall be the chief accounting officer of the Trust and shall be in
charge of its books of account and accounting records and of its accounting
procedures, and shall have such duties and powers as are commonly incident to
the office of a controller, and such other duties and powers as may be
prescribed from time to time by the Trustees. The Controller shall be
responsible to and shall report to the Trustees, but in the ordinary conduct of
the Trust's business, shall be under the supervision of the Treasurer. Any
Assistant Controller shall have such duties and powers as shall be prescribed
from time to time by the Trustees or the Controller, and shall be responsible to
and shall report to the Controller. In the absence or disability of the
Controller, the Assistant Controller or, if there shall be more than one, the
Assistant Controllers in the order of their seniority or as otherwise designated
by the Trustees, shall have the powers and duties of the Controller.
SECTION 3.11. SECRETARY AND ASSISTANT SECRETARIES. The Secretary shall, if
and to the extent requested by the Trustees, attend all meetings of the
<PAGE>
Trustees, any Committee of the Trustees and/or the Shareholders and record all
votes and the minutes of proceedings in a book to be kept for that purpose,
shall give or cause to be given notice of all meetings of the Trustees, any
Committee of the Trustees, and of the Shareholders and shall perform such other
duties as may be prescribed by the Trustees. The Secretary, or in his absence
any Assistant Secretary, shall affix the Trust's seal to any instrument
requiring it, and when so affixed, it shall be attested by the signature of the
Secretary of an Assistant Secretary. The Secretary shall be the custodian of the
Share records and all other books, records and papers of the Trust (other than
financial) and shall see that all books, reports, statements, certificates and
other documents and records required by law are properly kept and filed. In the
absence or disability of the Secretary, the Assistant Secretary or, if there
shall be more than one, the Assistant Secretaries in the order of their
seniority or as otherwise designated by the Trustees, shall have the powers and
duties of the Secretary.
SECTION 3.12. SUBSTITUTIONS. In case of the absence or disability of any
officer of the Trust, or for any other reason that the Trustees may deem
sufficient, the Trustees may delegate, for the time being, the powers or duties,
or any of them, of such officer to any other officer, or to any Trustee.
SECTION 3.13. EXECUTION OF DEEDS, ETC. Except as the Trustees may generally
or in particular cases otherwise authorize or direct, all deeds, leases,
transfers, contracts, proposals, bonds, notes, checks, drafts and other
obligations made, accepted or endorsed by the Trust shall be signed or endorsed
on behalf of the Trust by the President, one of the Vice Presidents or the
Treasurer.
SECTION 3.14. POWER TO VOTE SECURITIES. Unless otherwise ordered by the
Trustees, the Treasurer shall have full power and authority on behalf of the
Trust to give proxies for, and/or to attend and to act and to vote at, any
meeting of stockholders of any corporation in which the Trust may hold stock,
and at any such meeting the Treasurer or his proxy shall possess and may
exercise any and all rights and powers incident to the ownership of such stock
which, as the owner thereof, the Trust might have possessed and exercised if
present. The Trustees, by resolution from time to time, or, in the absence
thereof, the Treasurer, may confer like powers upon any other person or persons
as attorneys and proxies of the Trust.
ARTICLE IV
COMMITTEES
SECTION 4.1. POWER OF TRUSTEES TO DESIGNATE COMMITTEES. The Trustees, by
vote of a majority of the Trustees then in office, may elect from their number
an Executive Committee and any other Committees and may delegate thereto some or
all of their powers except those which by law, by the Declaration or by these
<PAGE>
By-Laws may not be delegated; PROVIDED, that the Executive Committee shall not
be empowered to elect the Chairman of the Trustees, the President, the Treasurer
or the Secretary, to amend the By-Laws, to exercise the powers of the Trustees
under this Section 4.1 or under Section 4.3 hereof, or to perform any act for
which the action of a majority of the Trustees is required by law, by the
Declaration or by these By-Laws. The members of any such Committee shall serve
at the pleasure of the Trustees.
SECTION 4.2. RULES FOR CONDUCT OF COMMITTEE AFFAIRS. Except as otherwise
provided by the Trustees, each Committee elected or appointed pursuant to this
Article IV may adopt such standing rules and regulations for the conduct of its
affairs as it may deem desirable, subject to review and approval of such rules
and regulations by the Trustees at the next succeeding meeting of the Trustees,
but in the absence of any such action or any contrary provisions by the
trustees, the business of each Committee shall be conducted, so far as
practicable, in the same manner as provided herein and in the Declaration for
the Trustees.
SECTION 4.3. TRUSTEES MAY ALTER, ABOLISH, ETC., COMMITTEES. The Trustees
may at any time alter or abolish any Committee, change the membership of any
Committee, or revoke, rescind or modify any action of any Committee or the
authority of any Committee with respect to any matter or class of matters;
provided, that no such action shall impair the rights of any third parties.
SECTION 4.4. MINUTES; REVIEW BY TRUSTEES. Any Committee to which the
Trustees delegate any of their powers or duties shall keep records of its
meetings and shall report its actions to the Trustees.
<PAGE>
ARTICLE V
SEAL
The seal of the Trust shall consist of a flat-faced circular die with the
word "Massachusetts", together with the name of the Trust, the words "Trust
Seal", and the year of its organization cut or engraved thereon, but, unless
otherwise required by the Trustees, the seal shall not be necessary to be placed
on, and its absence shall not impair the validity of, any document, instrument
or other paper executed and delivered by or on behalf of the Trust.
ARTICLE VI
SHARES
SECTION 6.1. SHARE CERTIFICATES. Each Shareholder shall be entitled to
certificate stating the number of Shares owned by him in such form as shall be
prescribed from time to time by the Trustees. Such certificate shall be signed
by the Chairman or a Vice Chairman, or the President or a Vice-President, and by
the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
<PAGE>
Secretary of the Trust. Such signatures may be facsimiles if the certificate is
countersigned by a Transfer Agent, or by a Registrar, other than a Trustee,
officer or employee of the Trust. In case any officer who has signed or whose
facsimile signature has been placed on such certificate shall cease to be such
officer before such certificate is issued, it may be issued by the Trust with
the same effect as if he were such officer at the time of its issue.
SECTION 6.2. LOST, STOLEN, ETC., CERTIFICATES. If any certificate for
Shares shall be lost, stolen, destroyed or mutilated, the Trustees may authorize
the issuance of a new certificate of the same tenor and for the same number of
Shares in lieu thereof. The Trustees shall require the surrender of any
mutilated certificate in respect of which a new certificate is issued, and may,
in their discretion, before the issuance of a new certificate, require the owner
of a lost, stolen or destroyed certificate, or the owner's legal representative,
to make an affidavit or affirmation setting forth such facts as to the loss,
theft or destruction as they deem necessary, and to give the Trust a bond in
such reasonable sum as the Trustees direct, in order to indemnify the Trust.
SECTION 6.3. RECORD TRANSFER OF PLEDGED SHARES. A pledgee of Shares pledged
as collateral security shall be entitled to a new certificate in his name as
pledgee; PROVIDED, that the instrument of pledge substantially describes the
debt or duty that is intended to be secured thereby. Any such new certificate
shall express on its face that it is held as collateral security, and the name
of the pledgor shall be stated thereon. After such issue, and unless and until
such pledge is released, such pledgee and his successors and assigns shall alone
be entitled to the rights of a Shareholder, and entitled to vote such Shares.
ARTICLE VII
AMENDMENTS
SECTION 7.1. BY-LAWS SUBJECT TO AMENDMENT. These By-Laws may be altered,
amended or repealed, in whole or in part, at any time by vote of the holders of
a majority of the Shares (or whenever there shall be more than one class or
series of Shares, of the holders of sixty percent (60%) of the Shares of each
such class or series) issued, outstanding and entitled to vote. The Trustees, by
vote of a majority of the Trustees then in office, may alter, amend or repeal
these By-Laws, in whole or in party, including By-Laws adopted by the
Shareholders, except with respect to any provision hereof which by law, the
Declaration or these By-Laws requires action by the Shareholders; PROVIDED, that
no later than the time of giving notice of the meeting of Shareholders next
following the alternation, amendment ore repeal of these By-Laws, in whole or in
part, notice thereof, stating the substance of such action shall be given to all
Shareholders entitled to vote. By-Laws adopted by the Trustees may be altered,
amended or repealed by the Shareholders.
<PAGE>
SECTION 7.2. NOTICE OF PROPOSAL TO AMEND BY-LAWS REQUIRED. No proposal to
amend or repeal these By-Laws or to adopt new By-Laws shall be acted upon at a
meeting unless either (i) such proposal is stated in the notice or in the waiver
of notice, as the case may be, of the meeting of the Trustees or Shareholders at
which such action is take, or (ii) all of the Trustees or Shareholders, as the
case may be, are present at such meeting and all agree to consider such proposal
without protesting the lack of notice.
Exhibit 4(a)(i)
THE ALGER FUND
ALGER BALANCED PORTFOLIO
CLASS A
NUMBER
SHARES
CUSIP 015565 83 1
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(a)(ii)
THE ALGER FUND
ALGER BALANCED PORTFOLIO
CLASS B
NUMBER
SHARES
CUSIP 015565 70 8
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(a)(iii)
THE ALGER FUND
ALGER BALANCED PORTFOLIO
CLASS C
NUMBER
SHARES
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(b)(i)
THE ALGER FUND
ALGER MIDCAP GROWTH PORTFOLIO
CLASS A
NUMBER
SHARES
CUSIP 015565 86 4
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(b)(ii)
THE ALGER FUND
ALGER MIDCAP GROWTH PORTFOLIO
CLASS B
NUMBER
SHARES
CUSIP 015565 80 7
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(b)(iii)
THE ALGER FUND
ALGER MIDCAP GROWTH PORTFOLIO
CLASS C
NUMBER
SHARES
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger MidCap Growth
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Staple Secretary
ACKNOWLEDGMENT State of New York )
): S3 County of New York)
February 24, 1993
Then personally appeared the above named Nanci K. Staple and
acknowledged the foregoing instrument to be her free act and deed.
Before me,
Exhibit 4(c)(i)
THE ALGER FUND
ALGER CAPITAL APPRECIATION PORTFOLIO
CLASS A
NUMBER
SHARES
CUSIP 015565 84 9
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(c)(ii)
THE ALGER FUND
ALGER CAPITAL APPRECIATION PORTFOLIO
CLASS B
NUMBER
SHARES
CUSIP 015565 88 0
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(c)(iii)
THE ALGER FUND
ALGER CAPITAL APPRECIATION PORTFOLIO
CLASS C
NUMBER
SHARES
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(d)(i)
THE ALGER FUND
ALGER GROWTH PORTFOLIO
CLASS A
NUMBER
SHARES
CUSIP 015565 85 6
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(d)(ii)
THE ALGER FUND
ALGER GROWTH PORTFOLIO
CLASS B
NUMBER
SHARES
CUSIP 015565 60 9
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(d)(iii)
THE ALGER FUND
ALGER GROWTH PORTFOLIO
CLASS C
NUMBER
SHARES
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(e)(i)
THE ALGER FUND
ALGER SMALL CAPITALIZATION PORTFOLIO
CLASS A
NUMBER
SHARES
CUSIP 015565 87 2
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(e)(ii)
THE ALGER FUND
ALGER SMALL CAPITALIZATION PORTFOLIO
CLASS B
NUMBER
SHARES
CUSIP 015565 50 0
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 4(e)(iii)
THE ALGER FUND
ALGER SMALL CAPITALIZATION PORTFOLIO
CLASS C
NUMBER
SHARES
SEE REVERSE
FOR CERTAIN DEFINITIONS
is the owner of
COUNTERSIGNED AND REGISTERED
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NEW JERSEY 07302
TRANSFER AGENT
AND REGISTRAR
AUTHORIZED SIGNATURE
This Certifies that
Shares of beneficial interest with a $.001 par value of the Alger Balanced
Portfolio of The Alger Fund (hereinafter called the "Fund"), transferable on the
books of the Fund by the holder hereof in person or by duly authorized attorney,
upon surrender of this certificate properly endorsed. This certificate and the
shares represented hereby are issued and shall be held subject to all of the
provisions of the Agreement and Declaration of Trust of the Fund, a copy of
which is on file with the Secretary of State of the Commonwealth of
Massachusetts, to all of which the holder by acceptance hereof assents. This
certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
Witness the signatures of the Fund's duly authorized officers or facsimiles
thereof.
Dated:
TREASURER PRESIDENT
---------------
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
---------------
For value received, .......................hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
========================================
========================================........................................
................................................................................
Please print or typewrite name and address including postal zip code of assignee
................................................................................
................................................................................
..........................................................................Shares
represented by the within Certificate, and do hereby irrevocably constitute and
appoint
................................................................................
Attorney to transfer the said shares on the books of the within-named
Corporation with full power of substitution in the premises.
Dated,...........................................
................................................................................
NOTICE. THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: .......................................................
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO S.E.C. RULE
17Ad-15.
Exhibit 5(a)
INVESTMENT MANAGEMENT AGREEMENT
-------------------------------
THE ALGER FUND
ALGER BALANCED PORTFOLIO
May 22, 1992
Fred Alger Management, Inc.
75 Maiden Lane
New York, NY 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized under
the laws of the Commonwealth of Massachusetts, hereby confirms its agreement
with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger Balanced Portfolio (the
"Portfolio") by investing and reinvesting in investments of the kind and in
accordance with the limitations specified in its Agreement and Declaration of
Trust and in its Prospectus and Statement of Additional Information, as from
time to time in effect, and in such manner and to such extent as may from time
to time be approved by the Board of Trustees of the Fund. Copies of the Fund's
Prospectus, Statement of Additional Information and Agreement and Declaration of
Trust, as each may from time to time be amended, have been or will be submitted
to Alger. The Fund desires to employ and hereby appoints Alger to act as the
investment manager for the Portfolio. Alger accepts the appointment and agrees
to furnish the services for the compensation set forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
<PAGE>
Information as from time to time in effect; (c) make general investment
decisions for the Portfolio involving decisions concerning (i) the specific
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of tax returns, reports to and filings with the Securities and Exchange
Commission (the "SEC") and state Blue Sky authorities; calculation of the net
asset value of shares of the Portfolio; maintenance of the Portfolio's financial
accounts and records; and general assistance in all aspects of the Fund's
operations with respect to the Portfolio. In providing those services, Alger
will supervise the Portfolio's investments generally and conduct a continual
program of evaluation of the Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transactions, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, Alger may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
<PAGE>
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose.
In compliance with the requirements of Rule 31a-3 under the Act, Alger
hereby agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .75 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
<PAGE>
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund and of the officers or
Board of Trustees of the Fund; and any extraordinary expenses. Fund-wide
expenses not specifically identifiable to the Portfolio or any other portfolio
of the Fund will be allocated to all portfolios pro rata on the basis of their
relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and distribution expenses and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The Fund understands that Alger now acts, will continue to act and may act
in the future as investment adviser to fiduciary and other managed accounts and
as investment manager to one or more other investment companies (including other
portfolios of the Fund), and the Fund has no objection to Alger so acting,
provided that whenever the Portfolio and one or more other accounts or
investment companies advised by Alger have available funds for investment,
<PAGE>
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each entity. The Fund recognizes that
in some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Fund understands that the persons
employed by Alger to assist in the performance of Alger's duties hereunder will
not devote their full time to such service and nothing contained herein shall be
deemed to limit or restrict the right of Alger or any affiliate of Alger to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
10. TERM OF AGREEMENT
This Agreement shall continue until May 22, 1994 and thereafter shall
continue automatically for successive annual periods, provided such continuance
is specifically approved at least annually by (i) the Board of Trustees of the
Fund or (ii) a vote of a "majority" (as defined in the Act) of the Portfolio's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Trustees who are not "interested
persons" (as defined in the Act) of any party to this Agreement, by vote cast in
person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable, without penalty, on sixty (60) days' written notice, by
the Board of Trustees of the Fund or by vote of holders of a majority of the
Portfolio's outstanding voting securities, or upon sixty (60) days' written
notice, by Alger. This Agreement will also terminate automatically in the event
of its assignment (as defined in the Act and the rules thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
<PAGE>
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
THE ALGER FUND
/s/ Gregory S. Duch
By:---------------------
Authorized Officer
Accepted and Agreed:
FRED ALGER MANAGEMENT, INC.
/s/ Gregory S. Duch
By:---------------------------
Authorized Officer
Exhibit 5(b)
INVESTMENT MANAGEMENT AGREEMENT
-------------------------------
THE ALGER FUND
ALGER MIDCAP GROWTH PORTFOLIO
March 29, 1993
Fred Alger Management, Inc.
75 Maiden Lane
New York, NY 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, hereby confirms its
agreement with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger MidCap Growth Portfolio
(the "Portfolio") by investing and reinvesting in investments of the kind and in
accordance with the limitations specified in its Agreement and Declaration of
Trust and in its Prospectus and Statement of Additional Information, as from
time to time in effect, and in such manner and to such extent as may from time
to time be approved by the Board of Trustees of the Fund. Copies of the Fund's
Prospectus, Statement of Additional Information and Agreement and Declaration of
Trust, as each may from time to time be amended, have been or will be submitted
to Alger. The Fund desires to employ and hereby appoints Alger to act as the
investment manager for the Portfolio. Alger accepts the appointment and agrees
to furnish the services for the compensation set forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
<PAGE>
Information as from time to time in effect; (c) make general investment
decisions for the Portfolio involving decisions concerning (i) the specific
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of tax returns, reports to and filings with the Securities and Exchange
Commission (the "SEC") and state Blue Sky authorities; calculation of the net
asset value of shares of the Portfolio; maintenance of the Portfolio's financial
accounts and records; and general assistance in all aspects of the Fund's
operations with respect to the Portfolio. In providing those services, Alger
will supervise the Portfolio's investments generally and conduct a continual
program of evaluaton of the Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transactions, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, Alger may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
<PAGE>
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose.
In compliance with the requirements of Rule 31a-3 under the Act, Alger
hereby agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .80 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination if this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
<PAGE>
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund and of the officers or
Board of Trustees of the Fund; and any extraordinary expenses. Fund-wide
expenses not specifically identifiable to the Portfolio or any other portfolio
of the Fund will be allocated to all portfolios pro rata on the basis of their
relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and distribution expenses and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The Fund understands that Alger now acts, will continue to act and may act
in the future as investment adviser to fiduciary and other managed accounts and
as investment manager to one or more other investment companies (including other
portfolios of the Fund), and the Fund has no objection to Alger so acting,
provided that whenever the Portfolio and one or more other accounts or
investment companies advised by Alger have available funds for investment,
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each entity. The Fund recognizes that
in some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Fund understands that the persons
employed by Alger to assist in the performance of Alger's duties hereunder will
not devote their full time to such service and nothing contained herein shall be
deemed to limit or restrict the right of Alger or any affiliate of Alger to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
10. TERM OF AGREEMENT
This Agreement shall continue until March 29, 1995 and thereafter shall
continue automatically for successive annual periods, provided such continuance
is specifically approved at least annually by (i) the Board of Trustees of the
Fund or (ii) a vote of a "majority" (as defined in the Act) of the Portfolio's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Trustees who are not "interested
persons" (as defined in the Act) of any party to this Agreement, by vote cast in
person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable, without penalty, on sixty (60) days' written notice, by
the Board of Trustees of the Fund or by vote of holders of a majority of the
Portfolio's outstanding voting securities, or upon sixty (60) days' written
notice, by Alger. This Agreement will also terminate automatically in the event
of its assignment (as defined in the Act and the rules thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
<PAGE>
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York,
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
THE ALGER FUND
/s/ Gregory S. Duch
By: -------------------------------
Authorized Officer
Accepted and Agreed:
FRED ALGER MANAGEMENT, INC,
/s/ Gregory S. Duch
By: -----------------------------
Authorized Officer
Exhibit 5(c)
INVESTMENT MANAGEMENT AGREEMENT
-------------------------------
THE ALGER FUND
ALGER LEVERAGED ALLCAP PORTFOLIO
October 15, 1993
Fred Alger Management, Inc.
75 Maiden Lane
New York, NY 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, hereby confirms its
agreement with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger Leveraged AllCap
Portfolio (the "Portfolio") by investing and reinvesting in investments of the
kind and in accordance with the limitations specified in its Agreement and
Declaration of Trust and in its Prospectus and Statement of Additional
Information, as from time to time in effect, and in such manner and to such
extent as may from time to time be approved by the Board of Trustees of the
Fund. Copies of the Fund's Prospectus, Statement of Additional Information and
Agreement and Declaration of Trust, as each may from time to time be amended,
have been or will be submitted to Alger. The Fund desires to employ and hereby
appoints Alger to act as the investment manager for the Portfolio. Alger accepts
the appointment and agrees to furnish the services for the compensation set
forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect; (c) make general investment
<PAGE>
decisions for the Portfolio involving decisions concerning (i) the specific
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of tax returns, reports to and filings with the Securities and Exchange
Commission (the "SEC") and state Blue Sky authorities; calculation of the net
asset value of shares of the Portfolio; maintenance of the Portfolio's financial
accounts and records; and general assistance in all aspects of the Fund's
operations with respect to the Portfolio. In providing those services, Alger
will supervise the Portfolio's investments generally and conduct a continual
program of evaluation of the Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transactions, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, Alger may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
<PAGE>
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose.
In compliance with the requirements of Rule 31a-3 under the Act, Alger
hereby agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .85 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination if this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
<PAGE>
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund and of the officers or
Board of Trustees of the Fund; and any extraordinary expenses. Fund-wide
expenses not specifically identifiable to the Portfolio or any other portfolio
of the Fund will be allocated to all portfolios pro rata on the basis of their
relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and extraordinary expenses, and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The Fund understands that Alger now acts, will continue to act and may act
in the future as investment adviser to fiduciary and other managed accounts and
as investment manager to one or more other investment companies (including other
portfolios of the Fund), and the Fund has no objection to Alger so acting,
provided that whenever the Portfolio and one or more other accounts or
investment companies advised by Alger have available funds for investment,
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each entity. The Fund recognizes that
in some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Fund understands that the persons
employed by Alger to assist in the performance of Alger's duties hereunder will
not devote their full time to such service and nothing contained herein shall be
deemed to limit or restrict the right of Alger or any affiliate of Alger to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
10. TERM OF AGREEMENT
This Agreement shall continue until October 15, 1995 and thereafter shall
continue automatically for successive annual periods, provided such continuance
is specifically approved at least annually by (i) the Board of Trustees of the
Fund or (ii) a vote of a "majority" (as defined in the Act) of the Portfolio's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Trustees who are not "interested
persons" (as defined in the Act) of any party to this Agreement, by vote cast in
person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable, without penalty, on sixty (60) days' written notice, by
the Board of Trustees of the Fund or by vote of holders of a majority of the
Portfolio's outstanding voting securities, or upon sixty (60) days' written
notice, by Alger. This Agreement will also terminate automatically in the event
of its assignment (as defined in the Act and the rules thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1988, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
<PAGE>
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
THE ALGER FUND
/s/ Gregory S. Duch
By: ---------------------
Authorized Officer
Accepted and Agreed:
FRED ALGER MANAGEMENT, INC.
/s/ Gregory S. Duch
By: -----------------------
Authorized Officer
Exhibit 5(d)
INVESTMENT MANAGEMENT AGREEMENT
THE ALGER FUND
Alger Small Capitalization Portfolio
October 24, 1986
Fred Alger Management
75 Maiden Lane
New York, New York 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, hereby confirms its
agreement with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger Small Capitalization
Portfolio (the "Portfolio") by investing and reinvesting in investments of the
kind and in accordance with the limitations specified in its Agreement and
Declaration of Trust and in its Prospectus and Statement of Additional
Information, as from time to time in effect, and in such manner and to such
extent as may from time to time be approved by the Board of Trustees of the
Fund. Copies of the Fund's Prospectus, Statement of Additional Information and
Agreement and Declaration of Trust, as each may from time to time be amended,
have been or will be submitted to Alger. The Fund desires to employ and hereby
appoints Alger to act as the investment manager for the Portfolio. Alger accepts
the appointment and agrees to furnish the services for the compensation set
forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect; (c) make general investment
decisions for the Portfolio involving decisions concerning (i) the specific
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of tax returns, reports to and filings with the Securities and Exchange
Commission (the "SEC") and state Blue Sky authorities; calculation of the net
asset value of shares of the Portfolio; maintenance of the Portfolio's financial
accounts and records; and general assistance in all aspects of the Fund's
operations with respect to the Portfolio. In providing those services, Alger
will supervise the Portfolio's investments generally and conduct a continual
program of evaluation of the Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transaction, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, Alger may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
<PAGE>
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose. In
compliance with the requirements of Rule 31a-3 under the Act, Alger hereby
agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .85 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of its Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund and of the officers or
Board of Trustees of the Fund; and any extraordinary expenses. Fund-wide
expenses not specifically identifiable to the Portfolio or any other portfolio
of the Fund will be allocated to all portfolios pro rata on the basis of their
relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and distribution expenses and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER
Companies or Accounts The Fund understands that Alger now acts, will
continue to act and may act in the future as investment adviser to fiduciary and
other managed accounts and as investment manager to one or more other investment
companies (including other portfolios of the Fund), and the Fund has no
objection to Alger so acting, provided that whenever the Portfolio and one or
more other accounts or investment companies advised by Alger have available
funds for investment, investments suitable and appropriate for each will be
allocated in accordance with a formula believed to be equitable to each entity.
The Fund recognizes that in some cases this procedure may adversely affect the
size of the position obtainable for the Portfolio. In addition, the Fund
understands that the persons employed by Alger to assist in the performance of
Alger's duties hereunder will not devote their full time to such service and
nothing contained herein shall be deemed to limit or restrict the right of Alger
or any affiliate of Alger to engage in and devote time and attention to other
businesses or to render services of whatever kind or nature.
<PAGE>
10. TERM OF AGREEMENT
This Agreement shall continue until October 24, 1988 and thereafter shall
continue automatically for successive annual periods ending on October 24th of
each year, provided such continuance is specifically approved at least annually
by (i) the Board of Trustees of the Fund or (ii) a vote of a "majority" (as
defined in the Act) of the Portfolio's outstanding voting securities, provided
that in either event the continuance is also approved by a majority of the Board
of Trustees who are not "interested persons" (as defined in the Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable, without
penalty, on 60 days written notice, by the Board of Trustees of the Fund or by
vote of holders of a majority of the Portfolio's outstanding voting securities,
or upon 60 days' written notice, by Alger. This Agreement will also terminate
automatically in the event of its assignment (as defined in the Act and the
ruled thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws
(except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
The Alger Fund
By: /s/George J. Boggio
-----------------------
Authorized Officer
Accepted and Agreed:
Fred Alger Management, Inc.
By: /s/George J. Boggio
- ---------------------------
Authorized Officer
Exhibit 5(e)
INVESTMENT MANAGEMENT AGREEMENT
-------------------------------
THE ALGER FUND
Alger Money Market Portfolio
October 24, 1986
Fred Alger Management, Inc.
75 Maiden Lane
New York, New York 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized under
the laws of the Commonwealth of Massachusetts, hereby confirms its agreement
with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger Money Market Portfolio
(the "Portfolio") by investing and reinvesting in investments of the kind and in
accordance with the limitations specified in its Agreement and Declaration of
Trust and in its Prospectus and Statement of Additional Information, as from
time to time in effect, and in such manner and to such extent as may from time
to time be approved by the Board of Trustees of the Fund. Copies of the Fund's
Prospectus, Statement of Additional Information and Agreement and Declaration of
Trust, as each may from time to time be amended, have been or will be submitted
to Alger. The Fund desires to employ and hereby appoints Alger to act as the
investment manager for the Portfolio. Alger accepts the appointment and agrees
to furnish the services for the compensation set forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect; (c) make general investment
decisions for the Portfolio involving decisions concerning (i) the specific
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of tax returns, reports to and filings with the Securities and Exchange
Commission (the "SEC") and state Blue Sky authorities; calculation of the net
asset value of shares of the Portfolio; maintenance of the Portfolio's financial
accounts and records; and general assistance in all aspects of the Fund's
operations with respect to the Portfolio. In providing those services, Alger
will supervise the Portfolio's investments generally and conduct a continual
program of evaluation of the Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transaction, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute a particular
transaction and in evaluating the best overall terms available, Alger may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
<PAGE>
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose.
In compliance with the requirements of Rule 31a-3 under the Act, Alger
hereby agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .50 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
<PAGE>
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund and of the officers or
Board of Trustees of the Fund; and any extraordinary expenses. Fund-wide
expenses not specifically identifiable to the Portfolio or any other portfolio
of the Fund will be allocated to all portfolios pro rata on the basis of their
relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and distribution expenses and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The Fund understands that Alger now acts, will continue to act and may act
in the future as investment adviser to fiduciary and other managed accounts and
as investment manager to one or more other investment companies (including other
portfolios of the Fund), and the Fund has no objection to Alger so acting,
provided that whenever the Portfolio and one or more other accounts or
investment companies advised by Alger have available funds for investment,
<PAGE>
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each entity. The Fund recognizes that
in some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Fund understands that the persons
employed by Alger to assist in the performance of Alger's duties hereunder will
not devote their full time to such service and nothing contained herein shall be
deemed to limit or restrict the right of Alger or any affiliate of Alger to
engage in and devote time and attention to other businesses or to render
services of whatever kind or nature.
10. TERM OF AGREEMENT
This Agreement shall continue until October 24, 1988 and thereafter shall
continue automatically for successive annual periods ending on October 24th of
each year, provided such continuance is specifically approved at least annually
by (i) the Board of Trustees of the Fund or (ii) a vote of a "majority" (as
defined in the Act) of the Portfolio's outstanding voting securities, provided
that in either event the continuance is also approved by a majority of the Board
of Trustees who are not "interested persons" (as defined in the Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable, without
penalty, on 60 days' written notice, by the Board of Trustees of the Fund or by
vote of holders of a majority of the Portfolio's outstanding voting securities,
or upon 60 days' written notice, by Alger. This Agreement will also terminate
automatically in the event of its assignment (as defined in the Act and the
rules thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
<PAGE>
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
The Alger Fund
/s/George Boggio
By: ----------------------
Authorized Signature
Accepted and Agreed:
Fred Alger Management, Inc.
/s/George Boggio
By: ---------------------
Authorized Signature
Exhibit 5(f)
INVESTMENT MANAGEMENT AGREEMENT
-------------------------------
THE ALGER FUND
Alger Growth Portfolio
October 24, 1986
Fred Alger Management, Inc.
75 Maiden Lane
New York, New York 10038
Dear Sirs:
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, hereby confirms its
agreement with Fred Alger Management, Inc. ("Alger") as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Alger Growth Portfolio (the
"Portfolio") by investing and reinvesting in investments of the kind and in
accordance with the limitations specified in its Agreement and Declaration of
Trust and in its Prospectus and Statement of Additional Information, as from
time to time in effect, and in such manner and to such extent as may from time
to time be approved by the Board of Trustees of the Fund. Copies of the Fund's
Prospectus, Statement of Additional Information and Agreement and Declaration of
Trust, as each may from time to time be amended, have been or will be submitted
to Alger. The Fund desires to employ and hereby appoints Alger to act as the
investment manager for the Portfolio. Alger accepts the appointment and agrees
to furnish the services for the compensation set forth below.
2. SERVICES AS INVESTMENT MANAGER
Subject to the supervision and direction of the Board of Trustees of the
Fund, Alger will (a) act in strict conformity with the Fund's Agreement and
Declaration of Trust, the Investment Company Act of 1940 (the "Act") and the
Investment Advisers Act of 1940, as the same may from time to time be amended;
(b) manage the Portfolio in accordance with the Portfolio's investment objective
and policies as stated in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect; (c) make general investment
decisions for the Portfolio involving decisions concerning (i) the specific
<PAGE>
types of securities to be held by the Portfolio and the proportion of the
Portfolio's assets that should be allocated to such investments during
particular market cycles and (ii) the specific issuers whose securities will be
purchased or sold by the Portfolio; and (d) supply office facilities (which may
be in Alger's own offices); statistical and research data; data processing
services; clerical, accounting and bookkeeping services; internal auditing
services; internal executive and administrative services; stationery and office
supplies; preparation of reports to shareholders of the Portfolio; preparation
of reports to shareholder of the Portfolio; preparation of tax returns, reports
to and filings with the Securities and Exchange Commission (the "SEC") and state
Blue Sky authorities; calculation of the net asset value of shares of the
Portfolio; maintenance of the Portfolio's financial accounts and records; and
general assistance in all aspects of the Fund's operations with respect to the
Portfolio. In providing those services, Alger will supervise the Portfolio's
investments generally and conduct a continual program of evaluation of the
Portfolio's assets.
In connection with the performance of its duties under this Agreement, it
is understood that Alger may from time to time employ or associate with itself
such person or persons as Alger may believe to be particularly fitted to assist
it in the performance of this Agreement, it being understood that the
compensation of such person or persons shall be paid by Alger and that no
obligation may be incurred on the Fund's behalf in any such respect.
3. BROKERAGE
In executing transactions for the Portfolio and selecting brokers or
dealers, Alger will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Portfolio
transaction, Alger will consider all factors it deems relevant including, but
not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transactions
and on a continuing basis. In selecting brokers or dealers to execute a
particular transaction and in evaluating the best overall terms available, Alger
may consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Portfolio
and/or other accounts over which Alger or an affiliate exercises investment
discretion.
4. INFORMATION PROVIDED TO THE FUND
Alger will keep the Fund informed of developments materially affecting the
<PAGE>
Portfolio, and will, on its own initiative, furnish the Fund from time to time
with whatever information Alger believes is appropriate for this purpose.
In compliance with the requirements of Rule 31a-3 under the Act, Alger
hereby agrees that all records that it maintains for the Fund in respect of the
Portfolio are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
5. STANDARD OF CARE
Alger shall exercise its best judgment in rendering the services listed in
paragraph 2 above. Alger shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio in connection with the
matters to which this Agreement relates, provided that nothing herein shall be
deemed to protect or purport to protect Alger against any liability to the
Portfolio or to its shareholders to which Alger would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Alger's reckless disregard of its
obligations and duties under this Agreement.
6. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, the
Portfolio will pay Alger on the first business day of each month a fee for the
previous month at the annual rate of .75 of 1.00% of the Portfolio's average
daily net assets. The fee for the period from the date the Fund's registration
statement is declared effective by the SEC to the end of the month during which
its registration statement is declared effective shall be prorated according to
the proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
Alger, the value of the Portfolio's net assets shall be computed at the times
and in the manner specified in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect.
7. EXPENSES
Alger will bear all expenses in connection with the performance of its
services under this Agreement. The Portfolio will bear certain other expenses to
be incurred in its operation, including: taxes, interest, brokerage fees and
<PAGE>
commissions, if any; fees of Trustees of the Fund who are not officers,
directors or employees of Alger or any of its affiliates; SEC fees and state
Blue Sky qualification fees; charges of custodians and transfer and dividend
disbursing agents; charges of any independent pricing service retained to assist
in valuing the assets of the Portfolio; the Fund's proportionate share of
insurance premiums; outside auditing and legal expenses; costs of maintenance of
the Fund's existence; costs attributable to shareholder services, including,
without limitation, telephone and personnel expenses; costs of preparing and
printing prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of shareholders'
reports and meetings of the shareholders of the Fund; and any extraordinary
expenses. Fund-wide expenses not specifically identifiable to the Portfolio or
any other portfolio of the Fund will be allocated to all portfolios pro rata on
the basis of their relative net assets.
8. REIMBURSEMENT TO THE PORTFOLIO
If in any fiscal year the aggregate expenses of the Portfolio (including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
expenses and distribution expenses and, if permitted by state securities
commissions, extraordinary expenses) exceed the expense limitation imposed by
any state having jurisdiction over the Portfolio, Alger will reimburse the
Portfolio for such excess expense. Such expense reimbursement, if any, will be
estimated, reconciled and paid on a monthly basis.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS.
The Fund understands that Alger now acts, will continue to act and may act
in the future as investment adviser to fiduciary and other managed accounts and
as investment manager to one or more other investment companies (including other
portfolios of the Fund), and the Fund has no objection to Alger so acting,
provided that whenever the Portfolio and one or more other accounts or
investment companies advised by Alger have available funds for investment,
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each entity. The Fund recognizes that
in some cases this procedure may adversely affect the size of the position
obtainable for the Portfolio. In addition, the Fund understands that the persons
employed by Alger to assist in the performance of Alger's duties hereunder will
not devote their full time to such service and nothing contained herein shall be
<PAGE>
deemed to limit or restrict the right of Alger or any affiliate of Alger to
engage in and devote time and attention to other businesses or to render
services of whatever kind of nature.
10. TERM OF AGREEMENT
This Agreement shall continue until October 24, 1988 and thereafter shall
continue automatically for successive annual periods ending on October 24th of
each year, provided such continuance is specifically approved at least annually
by (i) the Board of Trustees of the Fund or (ii) a vote of a "majority" (as
defined in the Act) of the Portfolio's outstanding voting securities, provided
that in either event the continuance is also approved by a majority of the Board
of Trustees who are not "interested persons" (as defined in the Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable, without
penalty, on 60 days' written notice, by the Board of Trustees of the Fund or by
vote of holders of a majority of the Portfolio's outstanding voting securities,
or upon 60 days' written notice, by Alger. This Agreement will also terminate
automatically in the event of its assignment (as defined in the Act and the
rules thereunder).
11. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
12. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund in respect of the
Portfolio by the undersigned officer of the Fund in his capacity as an officer
of the Fund. The obligations of this Agreement shall be binding on the assets
and property of the Portfolio only and shall not be binding on any other
portfolio of the Fund or any Trustee, officer or shareholder of the Fund
individually.
13. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
The Alger Fund
/s/George Boggio
By: ---------------------
Authorized Officer
Accepted and Agreed:
Fred Alger Management, Inc.
/s/George Boggio
By: ------------------------
Authorized Officer
6011K Exhibit 6(a)
DISTRIBUTION AGREEMENT
----------------------
October 24, 1986
Fred Alger & Company, Incorporated
30 Montgomery Street
Jersey City, New Jersey 07302
Dear Sirs:
This is to confirm that, in consideration of the agreements hereinafter
contained, the undersigned, The Alger Fund (the "Fund"), an unincorporated
business trust organized under the laws of the Commonwealth of Massachusetts,
has agreed that Fred Alger & Company, Incorporated ("Alger") shall be, for the
period of this Agreement, the distributor of shares of beneficial interest of
the Fund.
1. SERVICES AS DISTRIBUTOR
1.1 Alger will act as agent for the distribution of each series of shares
of beneficial interest of the Fund (the "Shares") covered by the registration
statement, prospectus and statement of additional information then in effect
(the "Registration Statement") under the Securities Act of 1933, as amended (the
"1933 Act"), and the Investment Company Act of 1940, as amended (the "1940
Act").
1.2 Alger agrees to use its best efforts to solicit orders for the sale of
the Shares at the public offering price, as determined in accordance with the
Registration Statement, and will undertake such advertising and promotion as it
believes is reasonable in connection with such solicitation. Alger agrees to
bear all selling expenses, including the cost of printing prospectuses and
statements of additional information and distributing them to prospective
shareholders.
1.3 All activities by Alger as distributor of the Shares shall comply with
all applicable laws, rules and regulations, including, without limitation, all
rules and regulations made or adopted by the Securities and Exchange Commission
(the "SEC") or by any securities association registered under the Securities
Exchange Act of 1934. 1.4 Alger will provide one or more persons during normal
business hours to respond to telephone inquiries concerning the Fund.
--1--
<PAGE>
1.4 Alger will provide one or more persons during normal business hours to
respond to telephone inquiries concerning the Fund.
1.5 Alger acknowledges that, whenever in the judgment of the Fund's
officers such action is warranted for any reason, including, without limitation,
market, economic or political conditions, those officers may decline to accept
any orders for, or make any sales of, the Shares until such time as those
officers deem it advisable to accept such orders and to make such sales.
1.6 Alger will act only on its own behalf as principal should it choose to
enter into selling agreements with selected dealers or others.
1.7 As promptly as is possible after the last day of each month this
Agreement is in effect, the Fund may reimburse Alger for certain expenses
incurred by Alger in connection with the offering and sales of the Shares of
each of the portfolios of the Fund, other than the Alger Money Market Portfolio
(each a "Portfolio" and collectively, the "Portfolios"), under this Agreement
that are not covered by any contingent deferred sales charges received by Alger;
provided that payment shall be made in any month only to the extent that such
payment, together with any other payments made by the Fund pursuant to its Plan
of Distribution adopted in accordance with Rule 12b-1 under the 1940 Act (the
"Plan"), shall not exceed .0625 (.75 on an annualized basis) of the average
daily net assets of each of the Portfolios for the prior month. If distribution
expenses incurred during a month in excess of any contingent deferred sales
charges received by Alger in respect of a Portfolio are not fully reimbursed by
said monthly payment, the unpaid portion of the expenses may be carried forward
for payment by the Fund at the end of the following month(s) and interest, at
the prevailing broker loan rate, may be charged thereon, but only if such
payment would not cause the Portfolio for that month to exceed the monthly or
annual limitations on distribution expenses stated above.
For purposes of this Agreement, "distribution expenses" of Alger shall mean
all expenses borne by Alger or by any other person with which Alger has an
agreement approved by the Fund, which expenses represent payment for activities
primarily intended to result in the sale of the Shares, including, but not
limited to, the following:
(a) payments made to and expenses of persons who provide support
services in connection with the distribution of the Shares, including, but
not limited to, answering routine inquiries regarding the Portfolios,
processing shareholder transactions and providing any other shareholder
services not otherwise provided by the Fund's transfer agent;
--2--
<PAGE>
- --------------------------------------------------------------------------------
6011K
- --------------------------------------------------------------------------------
(b) costs relating to the formulation and implementation of marketing
and promotional activities, including, but not limited to, direct mail
promotions and television, radio, newspaper, magazine and other mass media
advertising;
(c) costs of printing and distributing prospectuses and reports of the
Fund to prospective shareholders of the Portfolios;
(d) costs involved in preparing, printing and distributing sales
literature pertaining to the Portfolios; and
(e) costs involved in obtaining whatever information, analyses and
reports with respect to marketing and promotional activities on behalf of
the Portfolios that the Fund may, from time to time, deem advisable.
Expenses incurred in connection with promotional activities shall be
identified to the Portfolio involved, except that, where expenses cannot be
identified to any particular Portfolio, expenses shall be allocated among the
Portfolios pro rata on the basis of their relative net assets. Distribution
expenses shall not include any expenditures in connection with services that
Alger, any of its affiliates or any other person have agreed to bear without
reimbursement.
1.8 Each written request for reimbursement under section 1.7 shall be
directed to the Treasurer of the Fund and shall show in reasonable detail the
expenses incurred by Alger.
1.9 Alger shall prepare and deliver reports to the Treasurer of the Fund,
for review by the Trustees, on a regular, at least quarterly, basis showing the
distribution expenses expected to be incurred in the ensuing quarter pursuant to
this Agreement and the Plan and the purposes therefor. Alger shall also prepare
and deliver reports to the Treasurer of the Fund, for review by the Trustees, on
a regular, at least quarterly, basis showing the distribution expenses actually
incurred in the past quarter, as well as any supplemental reports as the
Trustees, from time to time, may request.
1.10 Alger acknowledges that payments under the Plan are subject to the
approval of the Fund's Board of Trustees and that no Portfolio is contractually
obligated to make payments in any amount or at anytime, including those in
reimbursement of Alger for expenses and interest thereon incurred in a prior
month or year.
--3--
<PAGE>
- --------------------------------------------------------------------------------
6011K
- --------------------------------------------------------------------------------
2. DUTIES OF THE FUND
2.1 The Fund agrees to execute at its own expense any and all documents, to
furnish any and all information and to take any other actions that may be
reasonably necessary in connection with the qualification of the Shares for sale
in those states that Alger may designate.
2.2 The Fund shall furnish from time to time, for use in connection with
the sale of the Shares, such information reports with respect to the Fund and
the Shares as Alger may reasonably request, all of which shall be signed by one
or more of the Fund's duly authorized officers; and the Fund warrants that the
statements contained in any such reports, when so signed by one or more of the
Fund's officers, shall be true and correct. The Fund shall also furnish Alger
upon request with: (a) annual audits of the Fund's books and accounts made by
independent public accountants regularly retained by the Fund, (b) semiannual
unaudited financial statements pertaining to the Fund, (c) quarterly earnings
statements prepared by the Fund, (d) a monthly itemized list of the securities
in each Portfolio, (e) monthly balance sheets as soon as practicable after the
end of each month and (f) from time to time such additional information
regarding the Fund's financial condition as Alger may reasonably request.
3. REPRESENTATIONS AND WARRANTIES
The Fund represents to Alger that all registration statements, prospectuses
and statements of additional information filed by the Fund with the SEC under
the 1933 Act and the 1940 Act with respect to the Shares have been prepared in
conformity with the requirements of the 1933 Act, the 1940 Act and the rules and
regulations of the SEC thereunder. As used in this Agreement the terms
"registration statement", "prospectus" and "statement of additional information"
shall mean any registration statement, prospectus and statement of additional
information filed by the Fund with the SEC and any amendments and supplements
thereto that at any time shall have been filed with the SEC. The Fund represents
and warrants to Alger that any registration statement, prospectus and statement
of additional information, when such registration statement becomes effective,
will include all statements required to be contained therein in conformity with
the 1933 Act, the 1940 Act and the rules and regulations of the SEC; that all
statements of fact contained in any registration statement, prospectus or
statement of additional information will be true and correct when such
registration statement becomes effective; and that neither any registration
statement nor any prospectus or statement of additional information when such
registration
--4--
<PAGE>
- --------------------------------------------------------------------------------
6011K
- --------------------------------------------------------------------------------
statement becomes effective will include an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading to a purchaser of the Shares. Alger
may, but shall not be obligated to, propose from time to time such amendment or
amendments to any registration statement and such supplement or supplements to
any prospectus or statement of additional information as, in the light of future
developments, may, in the opinion of Alger's counsel, be necessary or advisable.
If the Fund shall not propose such amendment or amendments and/or supplement or
supplements within fifteen days after receipt by the Fund of a written request
from Alger to do so, Alger may, at its option, terminate this Agreement. The
Fund shall not file any amendment to any registration statement or supplement to
any prospectus or statement of additional information without giving Alger
reasonable notice thereof in advance; provided, however, that nothing contained
in this Agreement shall in any way limit the Fund's right to file at any time
such amendments to any registration statement and/or supplements to any
prospectus or statement of additional information, of whatever character, as the
Fund may deem advisable, such right being in all respects absolute and
unconditional.
4. INDEMNIFICATION
4.1 The Fund authorizes Alger and any dealers with whom Alger has entered
into dealer agreements to use any prospectus or statement of additional
information furnished by the Fund from time to time, in connection with the sale
of the Fund's shares. The Fund agrees to indemnify, defend and hold Alger, its
several officers and directors, and any person who controls Alger within the
meaning of Section 15 of the 1933 Act, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) that Alger, its officers and directors,
or any such controlling person, may incur under the 1933 Act, the 1940 Act or
common law or otherwise, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement, any prospectus or any statement of additional information, or arising
out of or based upon any omission or alleged omission to state a material fact
required to be stated in any registration statement, any prospectus or any
statement of additional information, or necessary to make the statements in any
of them not misleading; provided, however, that the Fund's agreement to
indemnify Alger, its officers or directors, and any such controlling person
shall not be deemed to cover any claims, demands,
--5--
<PAGE>
- --------------------------------------------------------------------------------
6011K
- --------------------------------------------------------------------------------
liabilities or expenses arising out of or based upon any statements or
representations made by Alger or its representatives or agents other than such
statements and representations as are contained in any registration statement,
prospectus or statement of additional information and in such financial and
other statements as are furnished to Alger pursuant to paragraph 2.2 hereof; and
further provided that the Fund's agreement to indemnify Alger and the Fund's
representations and warranties hereinbefore set forth in paragraph 3 shall not
be deemed to cover any liability to the Fund or its shareholders to which Alger
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of Alger's reckless
disregard of its obligations and duties under this Agreement. The Fund's
agreement to indemnify Alger, its officers and directors, and any such
controlling person, as aforesaid, is expressly conditioned upon the Fund's being
notified of any action brought against Alger, its officers or directors, or any
such controlling person, such notification to be given by letter or by telegram
addressed to the Fund at its principal office in New York, New York and sent to
the Fund by the person against whom such action is brought, within ten days
after the summons or other first legal process shall have been served. The
failure so to notify the Fund of any such action shall not relieve the Fund from
any liability that the Fund may have to the person against whom such action is
brought by reason of any such untrue or alleged untrue statement or omission or
alleged omission otherwise than on account of the Fund's indemnity agreement
contained in this paragraph 4.1. The Fund will be entitled to assume the defense
of any suit brought to enforce any such claim, demand or liability, but, in such
case, such defense shall be conducted by counsel of good standing chosen by the
Fund and approved by Alger. In the event the Fund elects to assume the defense
of any such suit and retain counsel of good standing approved by Alger, the
defendant or defendants in such suit shall bear the fees and expenses of any
additional counsel retained by any of them; but in case the Fund does not elect
to assume the defense of any such suit, or in case Alger does not approve of
counsel chosen by the Fund, the Fund will reimburse Alger, its officers and
directors, or the controlling person or persons named as defendant or defendants
in such suit, for the fees and expenses or any counsel retained by Alger or
them. The Fund's indemnification agreement contained in this paragraph 4.1 and
the Fund's representations and warranties in this Agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of Alger, its officers and directors, or any controlling person,
and shall survive the delivery of any of the Fund's shares. This agreement of
indemnity will inure exclusively to Alger's
--6--
<PAGE>
- --------------------------------------------------------------------------------
6011R
- --------------------------------------------------------------------------------
benefit, to the benefit of its several officers and directors, and their
respective estates, and to the benefit of the controlling persons and their
successors. The Fund agrees to notify Alger promptly of the commencement of any
litigation or proceedings against the Fund or any of its officers or Trustees in
connection with the issuance and sale of any of the Shares.
4.2 Alger agrees to indemnify, defend and hold the Fund, its several
officers and Trustees, and any person who controls the Fund within the meaning
of Section 15 of the 1933 Act, free and harmless from and against any and all
claims, demands, liabilities and expenses (including the costs of investigating
or defending such claims, demands or liabilities and any counsel fees incurred
in connection therewith) that the Fund, its officers or Trustees or any such
controlling person may incur under the 1933 Act, the 1940 Act or common law or
otherwise, but only to the extent that such liability or expense incurred by the
Fund, its officers or Trustees or such controlling person resulting from such
claims or demands shall arise out of or be based upon (a) any unauthorized sales
literature, advertisements, information, statements or representations or (b)
any untrue or alleged untrue statement of a material fact contained in
information furnished in writing by Alger to the Fund and used in the answers to
any of the items of the registration statement or in the corresponding
statements made in the prospectus or statement of additional information, or
shall arise out of or be based upon any omission or alleged omission to state a
material fact in connection with such information furnished in writing by Alger
to the Fund and required to be stated in such answers or necessary to make such
information not misleading. Alger's agreement to indemnify the Fund, its
officers and Trustees, and any such controlling person, as aforesaid, is
expressly conditioned upon Alger's being notified of any action brought against
the Fund, its officers or Trustees, or any such controlling person, such
notification to be given by letter or telegram addressed to Alger at its
executive office in New York, New York and sent to Alger by the person against
whom such action is brought, within ten days after the summons or other first
legal process shall have been served. Alger shall have the right of first
control of the defense of such action, with counsel of its own choosing,
satisfactory to the Fund, if such action is based solely upon such alleged
misstatement or omission on Alger's part, and in any other event the Fund, its
officers or Trustees or such controlling person shall each have the right to
participate in the defense or preparation of the defense of any such action. The
failure so to notify Alger of any such action shall not relieve Alger from any
liability that Alger may have to the Fund, its officers or Trustees, or to such
controlling person by reason of any such untrue or alleged
--7--
<PAGE>
- --------------------------------------------------------------------------------
6011K
- --------------------------------------------------------------------------------
untrue statement or omission or alleged omission otherwise than on account of
Alger's indemnity agreement contained in this paragraph 4.2. Alger agrees to
notify the Fund promptly of the commencement of any litigation or proceedings
against Alger or any of its officers or directors in connection with the
issuance and sale of any of the Shares.
5. EFFECTIVENESS OF REGISTRATION
None of the Shares shall be offered by either Alger or the Fund under any
of the provisions of this Agreement and no orders for the purchase or sale of
the Shares hereunder shall be accepted by the Fund if and so long as the
effectiveness of the registration statement then in effect or any necessary
amendments thereto shall be suspended under any of the provisions of the 1933
Act or if and so long as a current prospectus as required by Section 5(b)(2) of
the 1933 Act is not on file with the SEC; provided, however, that nothing
contained in this paragraph 5 shall in any way restrict or have an application
to or bearing upon the Fund's obligation to redeem its shares from any
shareholder in accordance with the provisions of the Fund's prospectus,
statement of additional information or articles of incorporation.
6. NOTICE TO ALGER
The Fund agrees to advise Alger immediately in writing:
(a) of any request by the SEC for amendments to the registration
statement, prospectus or statement of additional information then in effect
or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the registration statement, prospectus or
statement of additional information then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event that makes untrue any statement of a
material fact made in the registration statement, prospectus or statement
of additional information then in effect or that requires the making of a
change in such registration statement, prospectus or statement of
additional information in order to make the statements therein not
misleading; and
(d) of all actions of the SEC with respect to any amendment to any
registration statement, prospectus or statement of additional information
which may from time to time be filed with the SEC.
--8--
<PAGE>
- --------------------------------------------------------------------------------
6011R
- --------------------------------------------------------------------------------
7. TERM OF AGREEMENT
This Agreement shall continue until October 24, 1988 and thereafter shall
continue automatically for successive annual periods ending on October 24th of
each year, provided such continuance is specifically approved at least annually
by (a) the Fund's Board of Trustees or (b) a vote of a majority (as-defined in
the 1940 Act) of the Fund's outstanding voting securities, provided that in
either event the continuance is also approved by a majority of the Trustees of
the Fund who are not interested persons (as defined in the 1940 Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable, without
penalty, on 60 days' written notice, by the Fund's Board of Trustees or by vote
of the holders of a majority of the Fund's shares, or on 90 days' written
notice, by Alger. This agreement will also terminate automatically in the event
of its assignment (as defined in the 1940 Act and the rules thereunder).
8. REPRESENTATION BY THE FUND
The Fund represents that a copy of its Agreement and Declaration of Trust,
dated March 20, 1986, together with all amendments thereto, is on file in the
office of the Secretary of the Commonwealth of Massachusetts.
9. LIMITATION OF LIABILITY
This Agreement has been executed on behalf of the Fund by the undersigned
officer of the Fund in his capacity as an officer of the Fund. The obligations
of this Agreement shall be binding upon the assets and property of the Fund only
and shall not be binding upon any Trustee, officer or shareholder of the Fund
individually.
10. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws (except the conflict of law rules) of the State of New York.
--9--
<PAGE>
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
THE ALGER FUND
By: /s/George J. Boggio
-----------------------
Authorized Officer
Accepted and Agreed:
FRED ALGER & COMPANY, INCORPORATED
By: /s/George J. Boggio
----------------------------
Authorized Officer
--10--
Exhibit 6(a)(ii)
AMENDMENT TO DISTRIBUTION AGREEMENT
-----------------------------------
The Distribution Agreement dated October 24, 1986 between The Alger Fund
and Fred Alger & Company, Incorporated as amended December 31, 1996, is hereby
amended to reflect the creation of Class C shares for all Portfolios other than
the Alger Money Market Portfolio. The amended Distribution Agreement is affirmed
in all respects except that Paragraphs 1.7, 1.9 and 1.10 of the Agreement are
amended to read as follows:
1.7 As promptly as is possible after the last day of each month this
Agreement is in effect the Fund may reimburse Alger for certain expenses
incurred by Alger in connection with the offering and sales of the Class B
Shares of each of the portfolios of the Fund, other than the Alger Money Market
Portfolio (each a "Portfolio" and collectively, the "Portfolios"), under this
Agreement that are not covered by any contingent deferred sales charges received
by Alger with respect to Class B Shares of that Portfolio; provided that such
payment shall be made in any month only to the extent that such payment,
together with any other payments made by the Fund pursuant to its Plan of
Distribution for Class B Shares adopted in accordance with Rule 12b-1 under the
1940 Act shall not exceed .0625% (.75% on an annualized basis) of the average
daily net assets represented by the Class B Shares of each of the Portfolios for
the prior month. If distribution expenses incurred during a month in excess of
any contingent deferred sales charges received by Alger in respect of the Class
B Shares of a Portfolio are not fully reimbursed by said monthly payment, the
unpaid portion of the expenses may be carried forward for payment by the
Portfolio at the end of the following month(s) and interest, at the prevailing
broker loan rate, may be charged thereon but only if such payment would not
cause the Portfolio for the month to exceed the monthly or annual limitations on
distribution expenses stated above. The payments contemplated by this paragraph
shall be made only out of the assets allocable to each Portfolio's Class B
Shares.
For purposes of this Agreement, "distribution expenses" of Alger shall mean
all expenses borne by Alger or by any other person with which Alger has an
agreement approved by the Fund, which expenses represent payment for activities
primarily intended to result in the sale of Class B Shares, including, but not
limited to the following to the extent that they relate to Class B Shares:
(a) payments made to and expenses of persons who provide support
services in connection with the distribution of the Shares, including, but
not limited to, answering routine inquiries regarding the Portfolios,
processing shareholder transactions and providing any other shareholder
services not otherwise provided by the Fund's transfer agent;
(b) costs relating to the formulation and implementation of marketing
and promotional activities, including, but not limited to, direct mail
promotions and television, radio, newspaper, magazine and other mass media
advertising;
(c) costs of printing and distributing prospectuses and reports of the
Fund to prospective shareholders of the Portfolios;
(d) costs involved in preparing, printing and distributing sales
literature pertaining to the Portfolios; and
(e) costs involved in obtaining whatever information, analyses and
reports with respect to marketing and promotional activities on behalf of
the Portfolios that the Fund may from time to time deem advisable.
Expenses incurred in connection with promotional activities shall be
identified to the Portfolio involved, except that, where expenses cannot be
identified to any particular portfolio, expenses shall be allocated among the
Portfolios pro rata on the basis of their relative net assets represented by
Class B Shares. Distribution expenses shall not include any expenditures in
connection with services that Alger, any of its affiliates or any other person
have agreed to bear without reimbursement.
In addition to the foregoing, as promptly as is possible after the last day
of each month this Agreement is in effect, the Fund may, as compensation to
Alger for its distribution-related activities with respect to Class C Shares of
the Portfolios, make payments to Alger at an annual rate of up to .75% of the
average daily net assets of each Portfolio represented by the Class C Shares of
that Portfolio, such payments to be made, in each case, only out of the assets
allocable to the Portfolio's Class C Shares as contemplated by the Fund's Plan
of Distribution for Class C Shares. (Each of such Plan of Distribution and the
Plan of Distribution for Class B Shares is hereinafter referred to as a "Plan.")
1.9 Alger shall prepare and deliver reports to the Treasurer of the Fund,
for review by the Trustees, on a regular, at least quarterly basis showing the
distribution expenses expected to be incurred in the ensuing quarter pursuant to
this Agreement and the Plans and the purposes therefor. Alger shall also prepare
and deliver reports to the Treasurer of the Fund, for review by the Trustees, on
a regular, at least quarterly basis showing the distribution expenses actually
incurred in the past quarter, as well as any supplemental reports as the
Trustees, from time to time, may request.
1.10 Alger acknowledges that payments under each Plan are subject to the
approval of the Fund's Board of Trustees and that no Portfolio is contractually
obligated to make payments in any amount or at any time, including those in
reimbursement of Alger for expenses and interest thereon incurred in a prior
month or year.
This Amendment is accepted and agreed to by the Parties by their authorized
representatives as indicated by their signatures below on this 31st of July,
1997.
THE ALGER FUND
---------------
Treasurer
FRED ALGER & COMPANY, INCORPORATED
---------------
Executive Vice President
Exhibit 6(b)
SHAREHOLDER SERVICING AGREEMENT
-------------------------------
Fred Alger & Company, Incorporated
75 Maiden Lane
New York, NY 10038
Dear Sirs:
The Alger Fund (the "Fund") confirms its agreement with Fred Alger & Company,
Incorporated ("Alger Inc.") with respect to the servicing of shareholder
accounts in each series of the Fund other than the Alger Money Market Portfolio
(the "Series").
Section 1. COMPENSATION AND SERVICES TO BE RENDERED.
(a) The Fund will pay Alger Inc. an annual fee in compensation for its
services in connection with the servicing of shareholder accounts in each
Series. The annual fee paid to Alger Inc. under this Agreement will be
calculated daily and paid monthly by the Fund at the annual rate of .25% of the
Fund's average daily net assets attributable to each Series.
(b) The annual fee will be used by Alger Inc. to provide compensation for
ongoing servicing and/or maintenance of shareholder accounts in each Series and
to cover an allocable portion of overhead and other Alger Inc. and selected
dealer office expenses related to the servicing and/or maintenance of
shareholder accounts. Compensation will be paid by Alger Inc. to persons,
including Alger Inc. employees, who respond to inquiries of shareholders of the
Fund regarding their ownership of shares or their accounts with the Fund or who
provide other similar services not otherwise required to be provided by the
Fund's investment manager, transfer agent or other agent of the Fund.
Section 2. APPROVAL OF TRUSTEES.
This Agreement will not take effect until approved by a majority vote of both
(a) the full Board of Trustees of the Fund and (b) those Trustees who are not
interested persons of the Fund and who have no direct or indirect financial
interest in the operation of this Agreement (the "Independent Trustees"), cast
in person at a meeting called for the purpose of voting on this Agreement.
<PAGE>
SECTION 3. CONTINUANCE OF AGREEMENT.
This Agreement will continue will continue in effect from year to year so
long as its continuance is specifically approved annually by vote of the Fund's
Board of Trustees in the manner described in Section 2 above.
SECTION 4. TERMINATION.
(a) This Agreement may be terminated at any time with respect to any Series
without the payment of penalty, by vote of a majority of the Independent
Trustees or by vote of a majority of the outstanding voting securities
represented by the Series on not more than 60 days' written notice to Alger Inc.
(b) This Agreement will terminate automatically in the event of its
assignment.
Section 5. SELECTION OF CERTAIN TRUSTEES.
While this Agreement is in effect, the selection and nomination of the
Fund's Trustees who are not interested persons of the Fund will be committed to
the discretion of the Trustees then in office who are not interested persons of
the Fund.
Section 6. AMENDMENTS.
No material amendment to the Plan may be made unless approved by the Fund's
Board of Trustees in the manner described in Section 2 above.
Section 7. PRESERVATION OF MATERIALS.
The Fund will preserve copies of this Agreement for a period of not less
than six years (the first two years in an easily accessible place) from the date
of this Agreement.
Section 8. MEANING OF CERTAIN TERMS.
As used in this Agreement, the terms "interested person" and "majority of
the outstanding voting securities" will be deemed to have the same meaning that
those terms have under the investment Company Act of 1940, as amended (the
"Act") and the rules and regulations under the Act, subject to any exemption
that may be granted to the Fund under the Act by the Securities and Exchange
Commission.
<PAGE>
Section 9. FILING OF DECLARATION OF TRUST.
The Fund represents that a copy of its Declaration of Trust dated as of March
20, 1986, as amended from time to time (the "Declaration of Trust"), is on file
with the Secretary of the Commonwealth of Massachusetts and with the Boston City
Clerk.
Section 10. LIMITATION OF LIABILITY.
The obligations of the Fund under the Agreement will not be binding upon
any of the Trustees, shareholders, nominees, officers, employees or agents,
whether past, present or future, of the Fund, individually, but are binding only
upon the assets and property of the Fund, as provided in the Declaration of
Trust. The execution and delivery of this Agreement have been authorized by the
Trustees of the Fund, and signed by an authorized officer of the Fund, acting as
such, and neither the authorization by the Trustees nor the execution and
delivery by the officer will be deemed to have been made by any of them
individually or to impose any liability on any of them personally, but will bind
only the trust property of the Fund as provided in the Declaration of Trust. No
Series of the Fund will be liable for any claims against any other Series.
Section 11 DATES.
This Agreement has been executed by the Fund as of May 12, 1993 and will
become effective as of May 24, 1993.
If the terms and conditions described above are in accordance with your
understanding, kindly indicate your acceptance of this Agreement by signing and
returning to us the enclosed copy of this Agreement.
Very truly yours,
THE ALGER FUND
/s/ Gregory S. Duch
By: ---------------------------
Gregory S. Duch, Treasurer
Accepted:
FRED ALGER & COMPANY, INCORPORATED
/s/ Nanci K. Staple
By: ---------------------------
Nanci K. Staple, Secretary
Exhibit 8
CUSTODIAN CONTRACT
BETWEEN
THE ALGER FUND
AND
STATE STREET BANK AND TRUST COMPANY
-----------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
1. Employment of Custodian and Property to be Held By
It..................................................................... 1
2. Duties of the Custodian with Respect to Property of the
Fund by the Custodian in the United States............................. 2
2.1 Holding Securities 2
2.2 Delivery of Securities 2
2.3 Registration of Securities 4
2.4 Bank Accounts 4
2.5 Availability of Federal Funds 5
2.6 Collection of Income 5
2.7 Payment of Fund Monies 5
2.8 Liability for Payment in Advance of Receipt of
Securities Purchased 7
2.9 Appointment of Agents 7
2.10 Deposit of Fund Assets in U.S. Securities System 7
2.11 Fund Assets Held in the Custodian's Direct Paper
System 8
2.12 Segregated Account 9
2.13 Ownership Certificates for Tax Purposes 10
2.14 Proxies 10
2.15 Communications Relating to Portfolio Securities 10
3. Duties of the Custodian with Respect to Property of the
Fund Held Outside of the United States ................................ 10
3.1 Appointment of Foreign Sub-Custodians ............................ 10
3.2 Assets to be Held ................................................ 11
3.3 Foreign Securities Systems ....................................... 11
3.4 Holding Securities ............................................... 11
3.5 Agreements with Foreign Banking Institutions ..................... 11
3.6 Access of Independent Accountants of the Fund .................... 12
3.7 Reports by Custodian ............................................. 12
3.8 Transactions in Foreign Custody Account .......................... 12
3.9 Bank Accounts .................................................... 12
3.10 Liability of Foreign Sub-Custodians .............................. 12
3.11 Liability of Custodian ........................................... 13
3.12 Monitoring Responsibilities ...................................... 13
3.13 Branches of U.S. Banks ........................................... 13
3.14 Tax Law .......................................................... 14
<PAGE>
3.15 Rule 17f-5 ....................................................... 14
4. Payments for Sales or Repurchases or Redemptions of
Shares of the Fund .................................................... 14
5. Proper Instructions ................................................... 15
6. Actions Permitted Without Express Authority ........................... 15
7. Evidence of Authority ................................................. 16
8. Duties of Custodian With Respect to the Books of
Account and Calculation of Net Asset Value and Net
Income ................................................................ 16
9. Records ............................................................... 16
10. Opinions of Fund's Independent Accountants ............................ 17
11. Reports to Fund by independent Public Accountants ..................... 17
12. Compensation of Custodian ............................................. 17
13. Responsibility of Custodian ........................................... 17
14. Effective Period, Termination and Amendment ........................... 19
15. Successor Custodian ................................................... 19
16. Interpretive and Additional Provisions ................................ 20
17. Additional Funds ...................................................... 20
18. Massachusetts law to Apply ............................................ 20
19. Prior Contracts ....................................................... 20
20. Shareholder Communications Election ................................... 21
21. Limitation of Liability ............................................... 21
22. Headings .............................................................. 21
23. Notices ............................................................... 22
<PAGE>
CUSTODIAN CONTRACT
This Contract between The Alger Fund, a business trust organized and
existing under the laws of the Commonwealth of Massachusetts, having its
principal place of business at 75 Maiden Lane, New York, NY 10038, hereinafter
called the "Fund", and State Street Bank and Trust Company, a Massachusetts
trust company, having its principal place of business at 225 Franklin Street,
Boston, Massachusetts, 02110, hereinafter called the "Custodian",
WITNESSETH:
WHEREAS, the Fund is authorized to issue shares in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets; and
WHEREAS, the Fund currently offers shares in six series, Alger Money Market
Portfolio, Alger Small Capitalization Portfolio, Alger MidCap Growth Portfolio,
Alger Growth Portfolio, Alger Balanced Portfolio and Alger Capital Appreciation
Portfolio (such series together with all other series subsequently established
by the Fund and made subject to this Contract in accordance with paragraph 17,
being herein referred to as the "Portfolio(s)");
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
The Fund hereby employs the Custodian as the custodian of the assets of the
Portfolios of the Fund, including securities which the Fund, on behalf of the
applicable Portfolio desires to be held in places within the United States
("domestic securities") and securities it desires to be held outside the United
States ("foreign securities") pursuant to the provisions of the Declaration of
Trust. The Fund on behalf of the Portfolio(s) agrees to deliver to the Custodian
all securities and cash of the Portfolios, and all payments of income, payments
of principal or capital distributions received by it with respect to all
securities owned by the Portfolio(s) from time to time, and the cash
consideration received by it for such new or treasury shares of beneficial
interest of the Fund representing interests in the Portfolios, ("Shares") as may
be issued or sold from time to time. The Custodian shall not be responsible for
any property of a Portfolio held or received by the Portfolio and not delivered
to the Custodian or a sub-custodian.
Upon receipt of "Proper Instructions" (within the meaning of Article 5),
the Custodian shall on behalf of the applicable Portfolio(s) from time to time
employ one or more sub-custodians, located in the United States but only in
accordance with an applicable vote by the Board of Trustees of the Fund on
behalf of the applicable Portfolio(s), and provided that the Custodian shall
have no more or less responsibility or liability to the Fund on account of any
actions or omissions of any sub-custodian so employed than any such
sub-custodian has to the Custodian. The Custodian may employ as sub-custodian
for the Fund's foreign securities on behalf of the applicable Portfolio(s) the
<PAGE>
foreign banking institutions and foreign securities depositories designated in
Schedule A hereto, but only in accordance with the provisions of Article 3.
2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND HELD BY THE
CUSTODIAN IN THE UNITED STATES
2.1 HOLDING SECURITIES. The Custodian shall hold and physically segregate for
the account of each Portfolio all non-cash property, to be held by it in
the United States including all domestic securities owned by such
Portfolio, other than (a) securities which are maintained pursuant to
Section 2.10 in a clearing agency which acts as a securities depository or
in a book-entry system authorized by the U.S. Department of the Treasury
and certain federal agencies (each, a "U.S. Securities System") and (b)
commercial paper of an issuer for which State Street Bank and Trust Company
acts as issuing and paying agent ("Direct Paper") which is deposited and/or
maintained in the Direct Paper System of the Custodian (the "Direct Paper
System") pursuant to Section 2.11.
2.2 DELIVERY OF SECURITIES. The Custodian shall release and deliver domestic
securities owned by a Portfolio held by the Custodian or in a U.S.
Securities System account of the Custodian or in the Custodian's Direct
Paper book entry system account ("Direct Paper System Account") only upon
receipt of Proper Instructions from the Fund on behalf of the applicable
Portfolio, which may be continuing instructions when deemed appropriate by
the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Portfolio and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Portfolio;
3) In the case of a sale effected through a U.S. Securities System, in
accordance with the provisions of Section 2.10 hereof;
4) To the depository agent in connection with tender or other similar
offers for securities of the Portfolio;
5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of the
Portfolio or into the name of any nominee or nominees of the Custodian
or into the name or nominee name of any agent appointed pursuant to
Section 2.9 or into the name or nominee name of any sub-custodian
appointed pursuant to Article 1; or for exchange for a different
number of bonds, certificates or other evidence representing the same
aggregate face amount or number of units; PROVIDED that, in any such
case, the new securities are to be delivered to the Custodian;
<PAGE>
7) Upon the sale of such securities for the account of the Portfolio, to
the broker or its clearing agent, against a receipt, for examination
in accordance with "street delivery" custom; provided that in any such
case, the Custodian shall have no responsibility or liability for any
loss arising from the delivery of such securities prior to receiving
payment for such securities except as may arise from the Custodian's
own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions
for conversion contained in such securities, or pursuant to any
deposit agreement; provided that, in any such case, the new securities
and cash, if any, are to be delivered to the Custodian;
9) In the case of warrants, rights or similar securities, the surrender
thereof in the exercise of such warrants, rights or similar securities
or the surrender of interim receipts or temporary securities for
definitive securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;
10) For delivery in connection with any loans of securities made by the
Portfolio, BUT ONLY against receipt of adequate collateral as agreed
upon from time to time by the Custodian and the Fund on behalf of the
Portfolio, which may be in the form of cash or obligations issued by
the United States government, its agencies or instrumentalities,
except that in connection with any loans for which collateral is to be
credited to the Custodian's account in the book-entry system
authorized by the U.S. Department of the Treasury, the Custodian will
not be held liable or responsible for the delivery of securities owned
by the Portfolio prior to the receipt of such collateral;
11) For delivery as security in connection with any borrowings by the Fund
on behalf of the Portfolio requiring a pledge of assets by the Fund on
behalf of the Portfolio, BUT ONLY against receipt of amounts borrowed;
12) For delivery in accordance with the provisions of any agreement among
the Fund on behalf of the Portfolio, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 (the "Exchange
Act") and a member of The National Association of Securities Dealers,
Inc. ("NASD"), relating to compliance with the rules of The Options
Clearing Corporation and of any registered national securities
exchange, or of any similar organization or organizations. regarding
escrow or other arrangements in connection with transactions by the
Portfolio of the Fund;
<PAGE>
13) For delivery in accordance with the provisions of any agreement among
the Fund on behalf of the Portfolio, the Custodian, and a Futures
Commission Merchant registered under the Commodity Exchange Act,
relating to compliance with the rules of the Commodity Futures Trading
Commission and/or any Contract Market, or any similar organization or
organizations, regarding account deposits in connection with
transactions by the Portfolio of the Fund;
14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such Transfer Agent or to the
holders of Shares in connection with distributions in kind, as may be
described from time to time in the currently effective prospectus and
statement of additional information of the Fund, related to the
Portfolio ("Prospectus"), in satisfaction of requests by holders of
Shares for repurchase or redemption; and
15) For any other proper corporate purpose, BUT ONLY upon receipt of, in
addition to Proper Instructions from the Fund on behalf of the
applicable Portfolio, a certified copy of a resolution of the Board of
Trustees or of the Executive Committee signed by an officer of the
Fund and certified by the Secretary or an Assistant Secretary,
specifying the securities of the Portfolio to be delivered, setting
forth the purpose for which such delivery is to be made, declaring
such purpose to be a proper corporate purpose, and naming the person
or persons to whom delivery of such securities shall be made.
2.3 REGISTRATION OF SECURITIES. Domestic securities held by the Custodian
(other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of the Fund on behalf of the
Portfolio or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Portfolio, UNLESS the Fund has authorized in
writing the appointment of a nominee to be used in common with other
registered investment companies having the same investment adviser as the
Portfolio, or in the name or nominee name of any agent appointed pursuant
to Section 2.9 or in the name or nominee name of any sub-custodian
appointed pursuant to Article 1. All securities accepted by the Custodian
on behalf of the Portfolio under the terms of this Contract shall be in
"street name" or other good delivery form. If, however, the Fund directs
the Custodian to maintain securities in "street name", the Custodian shall
utilize its best efforts only to timely collect income due the Fund on such
securities and to notify the Fund on a best efforts basis only of relevant
corporate actions including, without limitation, pendency of calls,
maturities, tender or exchange offers.
2.4 BANK ACCOUNTS. The Custodian shall open and maintain a separate bank
account or accounts in the United States in the name of each Portfolio of
the Fund, subject only to draft or order by the Custodian acting pursuant
to the terms of this Contract, and shall hold in such account or accounts,
subject to the provisions hereof, all cash received by it from or for the
account of the Portfolio, other than cash maintained by the Portfolio in a
<PAGE>
bank account established and used in accordance with Rule 17f-3 under the
Investment Company Act of 1940. Funds held by the Custodian for a Portfolio
may be deposited by it to its credit as Custodian in the Banking Department
of the Custodian or in such other banks or trust companies as it may in its
discretion deem necessary or desirable; PROVIDED, however, that every such
bank or trust company shall be qualified to act as a custodian under the
Investment Company Act of 1940 and that each such bank or trust company and
the funds to be deposited with each such bank or trust company shall on
behalf of each applicable Portfolio be approved by vote of a majority of
the Board of Trustees of the Fund. Such funds shall be deposited by the
Custodian in its capacity as Custodian and shall be withdrawable by the
Custodian only in that capacity.
2.5 AVAILABILITY OF FEDERAL FUNDS. Upon mutual agreement between the Fund on
behalf of each applicable Portfolio and the Custodian, the Custodian shall,
upon the receipt of Proper Instructions from the Fund on behalf of a
Portfolio, make federal funds available to such Portfolio as of specified
times agreed upon from time to time by the Fund and the Custodian in the
amount of checks received in payment for Shares of such Portfolio which are
deposited into the Portfolio's account.
2.6 COLLECTION OF INCOME. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments
with respect to registered domestic securities held hereunder to which each
Portfolio shall be entitled either by law or pursuant to custom in the
securities business, and shall collect on a timely basis all income and
other payments with respect to bearer domestic securities if, on the date
of payment by the issuer, such securities are held by the Custodian or its
agent and shall credit such income, as collected, to such Portfolio's
custodian account. Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons and other income
items requiring presentation as and when they become due and shall collect
interest when due on securities held hereunder. Income due each Portfolio
on securities loaned pursuant to the provisions of Section 2.2 (10) shall
be the responsibility of the Fund. The Custodian will have no duty or
responsibility in connection therewith, other than to provide the Fund with
such information or data as may be necessary to assist the Fund in
arranging for the timely delivery to the Custodian of the income to which
the Portfolio is properly entitled.
2.7 PAYMENT OF FUND MONIES. Upon receipt of Proper instructions from the Fund
on behalf of the applicable Portfolio, which may be continuing instructions
when deemed appropriate by the parties, the Custodian shall pay out monies
of a Portfolio in the following cases only:
1) Upon the purchase of domestic securities, options, futures contracts
or options on futures contracts for the account of the Portfolio but
only (a) against the delivery of such securities or evidence of title
to such options, futures contracts or options on futures contracts to
the Custodian (or any bank, banking finn or trust company doing
business in the United States or abroad which is qualified under the
Investment Company Act of 1940, as amended, to act as a custodian and
has been designated by the Custodian as its subcustodian or as its
agent (pursuant to Section 2.9 hereof), as the case may be, for this
<PAGE>
purpose) registered in the name of the Portfolio or in the name of a
nominee of the Custodian referred to in Section 2.3 hereof or in
proper form for transfer; (b) in the case of a purchase effected
through a U.S. Securities System, in accordance with the conditions
set forth in Section 2.10 hereof; (c) in the case of a purchase
involving the Direct Paper System, in accordance with the conditions
set forth in Section 2.11; (d) in the case of repurchase agreements
entered into between the Fund on behalf of the Portfolio and the
Custodian, or another bank, or a broker-dealer which is a member of
NASD, (i) against delivery of the securities either in certificate
form or through an entry crediting the Custodian's account at the
Federal Reserve Bank, with such securities or (ii) against delivery of
the receipt evidencing purchase by the Portfolio of securities owned
by the Custodian along with written evidence of the agreement by the
Custodian to repurchase such securities from the Portfolio; or (e) for
transfer to a time deposit account of the Portfolio in any bank,
whether domestic or foreign; such transfer may be effected prior to
receipt of a confirmation from a broker and/or the applicable bank
pursuant to Proper Instructions from the Fund on behalf of the
Portfolio as defined in Article 5;
2) In connection with conversion, exchange or surrender of securities
owned by the Portfolio as set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued by the Portfolio as
set forth in Article 4 hereof;
4) For the payment of any expense or liability incurred by the Portfolio,
including but not limited to the following payments for the account of
the Portfolio: interest, taxes, management, accounting, transfer agent
and legal fees, and operating expenses of the Fund whether or not such
expenses are to be in whole or part capitalized or treated as deferred
expenses;
5) For the payment of any dividends on Shares of the Portfolio declared
pursuant to the governing documents of the Fund;
6) For payment of the amount of dividends received in respect of
securities sold short;
7) For any other proper purpose, BUT ONLY upon receipt of, in addition to
Proper Instructions from the Fund on behalf of the Portfolio, a
certified copy of a resolution of the Board of Trustees or of the
Executive Committee of the Fund signed by an officer of the Fund and
certified by its Secretary or an Assistant Secretary, specifying the
amount of such payment, setting forth the purpose for which such
payment is to be made, declaring such purpose to be a proper purpose,
and naming the person or persons to whom such payment is to be made.
<PAGE>
2.8 LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED. Except
as specifically stated otherwise in this Contract, in any and every case
where payment for purchase of domestic securities for the account of a
Portfolio is made by the Custodian in advance of receipt of the securities
purchased in the absence of specific written instructions from the Fund on
behalf of such Portfolio to so pay in advance, the Custodian shall be
absolutely liable to the Fund for such securities to the same extent as if
the securities had been received by the Custodian.
2.9 APPOINTMENT OF AGENTS. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940,
as amended, to act as a custodian, as its agent to carry out such of the
provisions of this Article 2 as the Custodian may from time to time direct;
PROVIDED, however, that the Fund shall be notified of such appointment and
the appointment of any agent shall not relieve the Custodian of its
responsibilities or liabilities hereunder. The Fund acknowledges that the
Custodian has notified the Fund that Chemical Bank acts as agent for the
Custodian for the delivery and safekeeping of physical securities in New
York.
2.10 DEPOSIT OF FUND ASSETS IN U.S. SECURITIES SYSTEMS. The Custodian may
deposit and/or maintain securities owned by a Portfolio in a clearing
agency registered with the Securities and Exchange Commission under Section
17A of the Securities Exchange Act of 1934, which acts as a securities
depository, or in the book-entry system authorized by the U.S. Department
of the Treasury and certain federal agencies, collectively referred to
herein as "U.S. Securities System" in accordance with applicable Federal
Reserve Board and Securities and Exchange Commission rules and regulations,
if any, and subject to the following provisions:
1) The Custodian may keep securities of the Portfolio in a U.S.
Securities System provided that such securities are represented in an
account ("Account") of the Custodian in the U.S. Securities System
which shall not include any assets of the Custodian other than assets
held as a fiduciary, custodian or otherwise for customers;
2) The records of the Custodian with respect to securities of the
Portfolio which are maintained in a U.S. Securities System shall
identify. by book-entry those securities belonging to the Portfolio;
3) The Custodian shall pay for securities purchased for the account of
the Portfolio upon (i) receipt of advice from the U.S. Securities
System that such securities have been transferred to the Account, and
(ii) the making of an entry on the records of the Custodian to reflect
such payment and transfer for the account of the Portfolio. The
Custodian shall transfer securities sold for the account of the
Portfolio upon (i) receipt of advice from the U.S. Securities System
that payment for such securities has been transferred to the Account,
and (ii) the making of an entry on the records of the Custodian to
<PAGE>
reflect such transfer and payment for the account of the Portfolio.
Copies of all advices from the U.S. Securities System of transfers of
securities for the account of the Portfolio shall identify the
Portfolio, be maintained for the Portfolio by the Custodian and be
provided to the Fund at its request. Upon request, the Custodian shall
furnish the Fund on behalf of the Portfolio confirmation of each
transfer to or from the account of the Portfolio in the form of a
written advice or notice and shall furnish to the Fund on behalf of
the Portfolio copies of daily transaction sheets reflecting each day's
transactions in the U.S. Securities System for the account of the
Portfolio;
4) The Custodian shall provide the Fund for the Portfolio with any report
obtained by the Custodian on the U.S. Securities System's accounting
system, internal accounting control and procedures for safeguarding
securities deposited in the U.S. Securities System;
5) The Custodian shall have received from the Fund on behalf of the
Portfolio the initial or annual certificate, as the case may be,
required by Article 14 hereof;
6) Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Fund for the benefit of the Portfolio
for any loss or damage to the Portfolio resulting from use of the U.S.
Securities System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any of its or
their employees or from failure of the Custodian or any such agent to
enforce effectively such rights as it may have against the U.S.
Securities System; at the election of the Fund, it shall be entitled
to be subrogated to the rights of the Custodian with respect to any
claim against the U.S. Securities System or any other person which the
Custodian may have as a consequence of any such loss or damage if and
to the extent that the Portfolio has not been made whole for any such
loss or damage.
2.11 FUND ASSETS HELD IN THE CUSTODIAN'S DIRECT PAPER SYSTEM. The Custodian may
deposit and/or maintain securities owned by a Portfolio in the Direct Paper
System of the Custodian subject to the following provisions:
1) No transaction relating to securities in the Direct Paper System will
be effected in the absence of Proper Instructions from the Fund on
behalf of the Portfolio;
2) The Custodian may keep securities of the Portfolio in the Direct Paper
System only if such securities are represented in an account
("Account") of the Custodian in the Direct Paper System which shall
not include any assets of the Custodian other than assets held as a
fiduciary, custodian or otherwise for customers;
<PAGE>
3) The records of the Custodian with respect to securities of the
Portfolio which are maintained in the Direct Paper System shall
identify by book-entry those securities belonging to the Portfolio;
4) The Custodian shall pay for securities purchased for the account of
the Portfolio upon the making of an entry on the records of the
Custodian to reflect such payment and transfer of securities to the
account of the Portfolio. The Custodian shall transfer securities sold
for the account of the Portfolio upon the making of an entry on the
records of the Custodian to reflect such transfer and receipt of
payment for the account of the Portfolio;
5) The Custodian shall furnish the Fund on behalf of the Portfolio
confirmation of each transfer to or from the account of the Portfolio,
in the form of a written advice or notice, of Direct Paper on the next
business day following such transfer and shall furnish to the Fund on
behalf of the Portfolio copies of daily transaction sheets reflecting
each day's transaction in the U.S. Securities System for the account
of the Portfolio;
6) The Custodian shall provide the Fund on behalf of the Portfolio with
any report on its system of internal accounting control as the Fund
may reasonably request from time to time.
2.12 SEGREGATED ACCOUNT. The Custodian shall upon receipt of Proper Instructions
from the Fund on behalf of each applicable Portfolio establish and maintain
a segregated account or accounts for and on behalf of each such Portfolio,
into which account or accounts may be transferred cash and/or securities,
including securities maintained in an account by the Custodian pursuant to
Section 2.10 hereof, (i) in accordance with the provisions of any agreement
among the Fund on behalf of the Portfolio. the Custodian and a
broker-dealer registered under the Exchange Act and a member of the NASD
(or any futures commission merchant registered under the Commodity Exchange
Act), relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange (or the
Commodity Futures Trading Commission or any registered contract market), or
of any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Portfolio, (ii) for
purposes of segregating cash or government securities in connection with
options purchased, sold or written by the Portfolio Or commodity futures
contracts or options thereon purchased or sold by the Portfolio, (iii) for
the purposes of compliance by the Portfolio with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the
maintenance of segregated accounts by registered investment companies and
(iv) for other proper corporate purposes, BUT ONLY, in the case of clause
(iv), upon receipt of. in addition to Proper Instructions from the Fund on
behalf of the applicable Portfolio, a certified copy or' a resolution of
the Board of Trustees or of the Executive Committee signed by an officer of
<PAGE>
the Fund and certified by the Secretary or an Assistant Secretary, setting
forth the purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.
2.13 OWNERSHIP CERTIFICATES FOR TAX PURPOSES. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments with
respect to domestic securities of each Portfolio held by it and in
connection with transfers of securities.
2.14 PROXIES. The Custodian shall, with respect to the domestic securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of
the Portfolio or a nominee of the Portfolio, all proxies, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Portfolio such proxies, all proxy soliciting
materials and all notices relating to such securities.
2.15 COMMUNICATIONS RELATING TO PORTFOLIO SECURITIES. Subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the Fund for each
Portfolio all written information (including, without limitation, pendency
of calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options
written by the Fund on behalf of the Portfolio and the maturity of futures
contracts purchased or sold by the Portfolio) received by the Custodian
from issuers of the securities being held for the Portfolio. With respect
to tender or exchange offers, the Custodian shall transmit promptly to the
Portfolio all written information received by the Custodian from issuers of
the securities whose tender or exchange is sought and from the party (or
his agents) making the tender or exchange offer. If the Portfolio desires
to take action with respect to any tender offer, exchange offer or any
other similar transaction, the Portfolio shall notify the Custodian at
least three business days prior to the date on which the Custodian is to
take such action.
3. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND HELD OUTSIDE
OF THE UNITED STATES
3.1 APPOINTMENT OF FOREIGN SUB-CUSTODIANS. The Fund hereby authorizes and
instructs the Custodian to employ as sub-custodians for the Portfolio's
securities and other assets maintained outside the United States the
foreign banking institutions and foreign securities depositories designated
on Schedule A hereto ("foreign sub-custodians"). Upon receipt of "Proper
Instructions", as defined in Section 5 of this Contract, together with a
certified resolution of the Fund's Board of Trustees, the Custodian and the
Fund may agree to amend Schedule A hereto from time to time to designate
additional foreign banking institutions and foreign securities depositories
to act as sub-custodian. Upon receipt of Proper Instructions, the Fund may
instruct the Custodian to cease the employment of any one or more such
sub-custodians for maintaining custody of the Portfolio's assets.
<PAGE>
3.2 ASSETS TO BE HELD. The Custodian shall limit the securities and other
assets maintained in the custody of the foreign sub-custodians to: (a)
"foreign securities", as defined in paragraph (c)(1) of Rule 17f-5 under
the Investment Company Act of 1940, and (b) cash and cash equivalents in
such amounts as the Custodian or the Fund may determine to be reasonably
necessary to effect the Portfolio's foreign securities transactions. The
Custodian shall identify on its books as belonging to the Fund, the foreign
securities of the Fund held by each foreign sub-custodian.
3.3 FOREIGN SECURITIES SYSTEMS. Except as may otherwise be agreed upon in
writing by the Custodian and the Fund, assets of the Portfolios shall be
maintained in a foreign clearing agency which acts as a securities
depository or in a book-entry system for the central handling of securities
in a country or a foreign securities depository or clearing agency which
operates a transnational system for the central handling of securities or
equivalent book entries, located outside the United States (each a "Foreign
Securities System") only through arrangements implemented by the foreign
banking institutions serving as sub-custodians pursuant to the terms hereof
(Foreign Securities Systems and U.S. Securities Systems are collectively
referred to herein as the "Securities Systems"). Where possible, such
arrangements shall include entry into agreements containing the provisions
set forth in Section 3.5 hereof.
3.4 HOLDING SECURITIES. The Custodian may hold securities and other non-cash
property for all of its customers, including each Portfolio, with a foreign
sub-custodian in a single account that is identified as belonging to the
Custodian for the benefit of its customers, PROVIDED HOWEVER, that (i) the
records of the Custodian with respect to securities and other non-cash
property of the Portfolio which are maintained in such account shall
identify by book-entry those securities and other non-cash property
belonging to the Portfolio and (ii) the Custodian shall require that
securities and other non-cash property so held by the foreign sub-custodian
be held separately from any assets of the foreign sub-custodian or of
others.
3.5 AGREEMENTS WITH FOREIGN BANKING INSTITUTIONS. Each agreement with a foreign
banking institution shall provide that: (a) the assets of each Portfolio
will not be subject to any right, charge, security interest, lien or claim
of any kind in favor of the foreign banking institution or its creditors or
agent, except a claim of payment for their safe custody or administration;
(b) beneficial ownership for the assets of each Portfolio will be freely
transferable without the payment of money or value other than for custody
or administration; (c) adequate records will be maintained identifying the
assets as belonging to each applicable Portfolio; (d) officers of or
auditors employed by, or other representatives of the Custodian, including
to the extent permitted under applicable law the independent public
accountants for the Fund, will be given access to the books and records of
the foreign banking institution relating to its actions under its agreement
with the Custodian: and (e) assets of the Portfolios held by the foreign
sub-custodian will be subject only to the instructions of the Custodian or
its agents.
<PAGE>
3.6 ACCESS OF INDEPENDENT ACCOUNTANTS OF THE FUND. Upon request of the Fund,
the Custodian will use its best efforts to arrange for the independent
accountants of the Fund to be afforded access to the books and records of
any foreign banking institution employed as a foreign sub-custodian insofar
as such books and records relate to the performance of such foreign banking
institution under its agreement with the Custodian.
3.7 REPORTS BY CUSTODIAN. The Custodian will supply to the Fund from time to
time, as mutually agreed upon, and in any event upon the Fund's reasonable
request, statements in respect of the securities and other assets of the
Portfolio(s) held by foreign sub-custodians, including but not limited to
an identification of entities having possession of such securities and
other assets and advices or notifications of any transfers of securities to
or from each custodial account maintained by a foreign banking institution
for the Custodian on behalf of each applicable Portfolio indicating, as to
securities acquired for a Portfolio, the identity of the entity having
physical possession of such securities.
3.8 TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT. (a) Except as otherwise provided
in paragraph (b) of this Section 3.8, the provisions of Sections 2.2 and
2.7 of this Contract shall apply, MUTATIS MUTANDIS to the foreign
securities of the Fund held outside the United States by foreign
sub-custodians.
(b) Notwithstanding any provision of this Contract to the contrary,
settlement and payment for securities received for the account of each
applicable Portfolio and delivery of securities maintained for the
account of each applicable Portfolio may be effected in accordance
with the customary established securities trading or securities
processing practices and procedures in the jurisdiction or market in
which the transaction occurs, including, without limitation,
delivering securities to the purchaser thereof or to a dealer therefor
(or an agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such securities from such
purchaser or dealer.
(c) Securities maintained in the custody of a foreign sub-custodian may be
maintained in the name of such entity's nominee to the same extent as
set forth in Section 2.3 of this Contract, and the Fund agrees to hold
any such nominee harmless from any liability as a holder of record of
such securities.
3.9 BANK ACCOUNTS. The Custodian (or its foreign sub-custodian) may open and
maintain outside the United States a bank account or bank accounts on
behalf of the Fund or its applicable Portfolios in foreign banking
institutions, subject only to draft or order by the Custodian or its
foreign sub-custodian, acting pursuant to the terms of this Contract to
hold cash received by or from or for the account of the Fund on behalf of
its applicable Portfolios.
3.10 LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement pursuant to which the
Custodian employs a foreign banking institution as a foreign sub-custodian
shall require the institution to exercise reasonable care in the
performance of its duties and to indemnify, and hold harmless, the
<PAGE>
Custodian and the Fund from and against any loss, damage, cost, expense,
liability or claim arising out of or in connection with the institution's
performance of such obligations. At the election of the Fund, it shall be
entitled to be subrogated to the rights of the Custodian with respect to
any claims against a foreign banking institution as a consequence of any
such loss, damage, cost, expense, liability or claim if and to the extent
that the Fund has not been made whole for any such loss, damage, cost,
expense, liability or claim.
3.11 LIABILITY OF CUSTODIAN. The Custodian shall be liable for the acts or
omissions of a foreign banking institution to the same extent as set forth
with respect to sub-custodians generally in this Contract and, regardless
of whether assets are maintained in the custody of a foreign banking
institution, a foreign securities depository or a branch of a U.S. bank as
contemplated by paragraph 3.13 hereof, the Custodian shall not be liable
for any loss, damage, cost, expense, liability or claim resulting from
nationalization, expropriation, currency restrictions, or acts of war or
terrorism or any loss where the sub-custodian has otherwise exercised
reasonable care. Notwithstanding the foregoing provisions of this paragraph
3.10, in delegating custody duties to State Street London Ltd., the
Custodian shall not be relieved of any responsibility to the Fund for any
loss due to such delegation, except such loss as may result from (a)
political risk (including, but not limited to, exchange control
restrictions, confiscation, expropriation, nationalization, insurrection,
civil strife or armed hostilities) or (b) other losses (excluding a
bankruptcy or insolvency of State Street London Ltd. not caused by
political risk) due to Acts of God, nuclear incident or other losses under
circumstances where the Custodian and State Street London Ltd. have
exercised reasonable care.
3.12 MONITORING RESPONSIBILITIES. The Custodian shall furnish annually to the
Fund, during the month of June, information concerning the foreign
sub-custodians employed by the Custodian. Such information shall be similar
in kind and scope to that furnished to the Fund in connection with the
initial approval of this Contract. In addition, the Custodian will promptly
inform the Fund in writing in the event that the Custodian learns of a
material adverse change in the financial condition of a foreign
sub-custodian or any material loss of the assets of the Fund or in the case
of any foreign sub-custodian not the subject of an exemptive order from the
Securities and Exchange Commission is notified by such foreign
sub-custodian that there appears to be a substantial likelihood that its
shareholders' equity will decline below $200 million (U.S. dollars or the
equivalent thereof) or that its shareholders' equity has declined below
$200 million (in each case computed in accordance with generally accepted
U.S. accounting principles).
3.13 BRANCHES OF U.S. BANKS.
(a) Except as otherwise set forth in this Contract, the provisions hereof
shall not apply where the custody of the Portfolios assets are
maintained in a foreign branch of a banking institution which is a
"bank" as defined by Section 2(a)(5) of the Investment Company Act of
1940 meeting the qualification set forth in Section 26(a) of said Act.
The appointment of any such branch as a sub-custodian shall be
governed by paragraph 1 of this Contract.
<PAGE>
(b) Cash held for each Portfolio of the Fund in the United Kingdom shall
be maintained in an interest bearing account established for the
Portfolio with the Custodian's London branch, which account shall be
subject to the direction of the Custodian, State Street London Ltd. or
both.
3.14 TAX LAW. The Custodian shall have no responsibility or liability for any
obligations now or hereafter imposed on the Fund or the Custodian as
custodian of the Fund by the tax law of the United States of America or
any state or political subdivision thereof other than for income,
franchise or similar taxes imposed on or assessed against the Custodian as
custodian. It shall be the responsibility of the Fund to notify the
Custodian of the obligations imposed on the Fund or the Custodian as
custodian of the Fund by the tax law of jurisdictions other than those
mentioned in the above sentence, including responsibility for withholding
and other taxes, assessments or other governmental charges, certifications
and governmental reporting. The sole responsibility of the Custodian with
regard to such tax law shall be to use reasonable efforts to assist the
Fund with respect to any claim for exemption or refund under the tax law
of jurisdictions for which the Fund has provided such information.
3.15 RULE 17F-5. This Article 3 shall be governed by, and interpreted in
accordance with, and the practices, arrangements and other matters
contemplated hereby shall be conducted in conformity with, Rule 17f-5
under the Investment Company Act of 1940, as amended, as such Rule is
interpreted in publications of the Securities and Exchange Commission and
its staff; in any conflict between this Article 3 and the Rule (as
interpreted), the Rule shall govern.
4. Payments for Sales or Repurchases or Redemptions of Shares of the Fund
The Custodian shall receive from the distributor for the Shares or from the
transfer agent of the Fund ("Transfer Agent") and deposit into the account of
the appropriate Portfolio such payments as are received for Shares of that
Portfolio issued or sold from time to time by the Fund. The Custodian will
provide timely notification to the Fund on behalf of each such Portfolio and the
Transfer Agent of any receipt by it of payments for Shares of such Portfolio.
From such funds as may be available for the purpose but subject to the
limitations of the Declaration of Trust and any applicable votes of the Board of
Trustees of the Fund pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for payment to
holders of Shares who have delivered to the Transfer Agent a request for
redemption or repurchase of their Shares. In connection with the redemption or
repurchase of Shares of a Portfolio, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares of the Fund, the Custodian shall honor payable through
drafts drawn on the Custodian by a holder of Shares, which payable-through
drafts have been furnished by the Fund to the holder of Shares. when presented
to the Custodian in accordance with such procedures and controls as are mutually
agreed upon from time to time between the Fund and the Custodian.
5. PROPER INSTRUCTIONS
Proper Instructions as used throughout this Contract means a writing signed
or initialed by one or more person or persons as the Board of Trustees of the
Fund shall have from time to time authorized. Each such writing shall set forth
the specific transaction or type of transaction involved, including a specific
statement of the purpose for which such action is requested. Oral instructions
will be considered Proper Instructions if the Custodian reasonably believes them
to have been given by a person authorized to give oral instructions with respect
to the transaction involved. The Fund shall cause all oral instructions to be
confirmed in writing. Upon receipt of a certificate of the Secretary or an
Assistant Secretary as to the authorization by the Board of Trustees of the Fund
accompanied by a detailed description of procedures approved by the Board of
Trustees, Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Board of
Trustees and the Custodian are satisfied that such procedures afford adequate
safeguards for the Portfolios' assets. For purposes of this Section, Proper
Instructions shall include instructions received by the Custodian pursuant to
any three - party agreement which requires a segregated asset account in
<PAGE>
accordance with Section 2.12. The Fund shall provide the Custodian with a list
of authorized persons, certified as to their authority by the Secretary or
Assistant Secretary of the Fund and updated as appropriate from time to time.
6. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY.
The Custodian may in its discretion, without express authority from the
Fund on behalf of each applicable Portfolio:
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Contract, PROVIDED that all such payments shall be accounted for to
the Fund on behalf of the Portfolio;
2) surrender securities in temporary form for securities in definitive
form;
3) endorse for collection, in the name of the Portfolio, checks, drafts
and other negotiable instruments; and
4) in general, attend to all non-discretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other
dealings with the securities and property of the Portfolio except as
otherwise directed by the Board of Trustees of the Fund.
<PAGE>
7. EVIDENCE OF AUTHORITY
The Custodian shall be protected in acting as provided herein upon any
instructions, notice, request, consent, certificate or other instrument or paper
reasonably believed by it to be genuine and to have been properly executed by or
on behalf of the Fund. The Custodian may receive and accept a certified copy of
a vote of the Board of Trustees of the Fund as conclusive evidence (a) of the
authority of any person to act in accordance with such vote or (b) of any
determination or of any action by the Board of Trustees pursuant to the
Declaration of Trust as described in such vote, and such vote may be considered
as in full force and effect until receipt by the Custodian of written notice to
the contrary.
8. DUTIES OF CUSTODIAN WITH RESPECT TO THE BOOKS OF ACCOUNT AND CALCULATION OF
NET ASSET VALUE AND NET INCOME
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board of Trustees of the Fund to keep the
books of account of each Portfolio and/or compute the net asset value per share
of the outstanding Shares of each Portfolio or, if directed in writing to do so
by the Fund on behalf of the Portfolio, shall itself keep such books of account
and/or compute such net asset value per share. If so directed, the Custodian
shall also calculate daily the net income of the Portfolio as described in the
Fund's currently effective prospectus related to such Portfolio and shall advise
the Fund and the Transfer Agent daily of the total amounts of such net income
and, if instructed in writing by an officer of the Fund to do so, shall advise
the Transfer Agent periodically of the division of such net income among its
various components. The calculations of the net asset value per share and the
dally income of each Portfolio shall be made at the time or times described from
time to time in the Fund's currently effective prospectus related to such
Portfolio.
9. RECORDS
The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Contract in such
manner as will meet the obligations of the Fund under the Investment Company Act
of 1940, with particular attention to Section 31 thereof and Rules 3la-1 and
3la-2 thereunder. All such records shall be the property of the Fund and shall
at all times during the regular business hours of the Custodian be open for
inspection by duly authorized officers, employees or agents of the Fund and
employees and agents of the Securities and Exchange Commission. The Custodian
shall, at the Fund's request, supply the Fund with a tabulation of securities
owned by each Portfolio and held by the Custodian and shall. when requested to
do so by the Fund and for such compensation as shall be agreed upon between the
Fund and the Custodian. include certificate numbers in such tabulations.
10. OPINION OF FUND'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as the Fund on behalf of
each applicable Portfolio may from time to time request, to obtain from year to
year favorable opinions from the Fund's independent accountants with respect to
<PAGE>
its activities hereunder in connection with the preparation of the Fund's
registration statement and amendments thereto and Form N-SAR or other annual
reports to the Securities and Exchange Commission and with respect to any other
requirements of such Commission.
11. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Fund, on behalf of each of the Portfolios
at such times as the Fund may reasonably require, with reports by independent
public accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, futures contracts and options on futures
contracts, including securities deposited and/or maintained in a Securities
System, relating to the services provided by the Custodian under this Contract;
such reports, shall be of sufficient scope and in sufficient detail, as may
reasonably be required by the Fund to provide reasonable assurance that any
material inadequacies would be disclosed by such examination, and, if there are
no such inadequacies, the reports shall so state. In addition, the Custodian
shall supply the Fund and its independent public accountants with such
information as they may reasonably request from time to time in order to monitor
the performance of the Custodian under this Contract.
12. COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to reasonable compensation for its services
and expenses as Custodian, as set forth in the attached [Appendix A], which may
be changed as agreed from time to time between the Fund on behalf of each
applicable Portfolio and the Custodian.
13. RESPONSIBILITY OF CUSTODIAN
So long as and to the extent that it is in the exercise of reasonable care,
the Custodian shall not be responsible/for the title.,validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. Except as otherwise specifically stated heroin in
Section 2.8, the Custodian shall be held to the exercise of reasonable care in
carrying out the provisions of this Contract, but shall be kept indemnified by
and shall be without liability to the Fund for any action taken or omitted by it
in good faith without negligence. It shall be entitled to rely on and may act
upon advice of counsel (who may be counsel for the Fund) on all matters, and
shall be without liability for any action reasonably taken or omitted in good
faith and without negligence in conformity with such advice.
Except as may arise from the Custodian's own negligence or willful
misconduct or the negligence or willful misconduct of a sub-custodian, nominee
or agent, the Custodian shall be without liability to the Fund for any loss,
liability, claim or expense resulting from or caused by: (1) events or
circumstances beyond the reasonable control of the Custodian or any
sub-custodian or Securities System or any agent or nominee of any of the
foregoing, including, without limitation, nationalization or expropriation,
<PAGE>
imposition of currency controls or restrictions, the interruption, suspension or
restriction of trading on or the closure of any securities market, power or
other mechanical or technological failures or interruptions, computer viruses or
communications disruptions, acts of war or terrorism, riots, revolutions, work
stoppages, natural disasters or other similar events or acts; (ii) errors by the
Fund or the Investment Advisor in their instructions to the Custodian provided
such instructions have been in accordance with this Contract; (iii) the
insolvency of or acts or omissions by a Securities System; (iv) any delay or
failure of any broker, agent or intermediary, central bank or other commercially
prevalent payment or clearing system to deliver to the Custodian's sub-custodian
or agent securities purchased or in the remittance or payment made in connection
with securities sold; (v) any delay or failure of any company, corporation, or
other body in charge of registering or transferring securities in the name of
the Custodian, the Fund, the Custodian's sub-custodians, nominees or agents or
any consequential losses arising out of such delay or failure to transfer such
securities including non-receipt of bonus, dividends and rights and other
accretions or benefits; (vi) delays or inability to perform its duties due to
any disorder in market infrastructure with respect to any particular security or
Securities System: and (vii) any provision of any present or future law or
regulation or order of the United States of America, or any state thereof, or
any other country, or political subdivision thereof or of any court of competent
jurisdiction. The Custodian shall promptly inform the Fund in writing of any of
the foregoing matters; as they arise. Upon the occurrence of any of the
foregoing events which causes or may cause any loss, damage or expense to the
Fund, the Custodian shall use all commercially reasonable efforts and take all
reasonable steps under the circumstances to mitigate the effects of such event
and to avoid continuing harm to the Fund.
If the Fund on behalf of the Portfolio requires the Custodian to take any
action with respect to securities, which action involves the payment of money or
which action may, in the opinion of the Custodian, result in the Custodian or
its nominee assigned to the Fund or the Portfolio being liable for the payment
of money or incurring liability of some other form, the Fund on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it as shall be agreed by the parties in writing.
If the Fund requires the Custodian, its affiliates, subsidiaries or agents,
to advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses incurred on behalf of the applicable Portfolio,
assessments, claims or liabilities in connection with the performance of this
Contract, except such as may arise from its or its nominee's own negligent
action, negligent failure to act or willful misconduct, any property at any time
held for the account of the applicable Portfolio other than property held in a
segregated account pursuant to Section 2.10 hereof shall be security therefor
and should the Fund fail to repay the Custodian promptly upon written notice
from the Custodian. the Custodian shall, upon written notice to the Fund, be
entitled to utilize available cash and to dispose of such Portfolio's assets to
the extent necessary to obtain reimbursement.
In no event shall the Custodian be liable for indirect, special or consequential
damages.
<PAGE>
14. EFFECTIVE PERIOD. TERMINATION AND AMENDMENT
This Contract shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than thirty (30)
days after the date of such delivery or mailing; PROVIDED, however that the
Custodian shall not with respect to a Portfolio act under Section 2.10 hereof in
the absence of receipt of an initial certificate of the Secretary or an
Assistant Secretary that the Board of Trustees of the Fund has approved the
initial use of a particular Securities System by such Portfolio, as required by
Rule 17f-4 under the Investment Company Act of 1940, as amended and that the
Custodian shall not with respect to a Portfolio act under Section 2.11 hereof in
the absence of receipt of an initial certificate of the Secretary or an
Assistant Secretary that the Board of Trustees has approved the initial use of
the Direct Paper System by such Portfolio; PROVIDED FURTHER, however, that
neither party shall amend or terminate this Contract in contravention of any
applicable federal or state regulations, or any provision of the Declaration of
Trust, and further provided, that the Fund on behalf of one or more of the
Portfolios may at any time by action of its Board of Trustees (i) substitute
another bank or trust company for the Custodian by giving notice as described
above to the Custodian, or (ii) immediately terminate this Contract in the event
of the appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Upon termination of the Contract, the Fund on behalf of each applicable
Portfolio shall pay to the Custodian such compensation as may be due as of the
date of such termination and shall likewise reimburse the Custodian for its
costs, expenses and disbursements.
15. SUCCESSOR CUSTODIAN
If a successor custodian for the Fund or for one or more of the Portfolios
shall be appointed by the Board of Trustees of the Fund, the Custodian shall,
upon termination, deliver to such successor custodian at the office of the
Custodian, duly endorsed and in the form for transfer, all securities of each
applicable Portfolio then held by it hereunder and shall transfer to an account
of the successor custodian all of the securities of each such Portfolio held in
a Securities System.
If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Board of Trustees
of the Fund, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
<PAGE>
properties held by the Custodian on behalf of each applicable Portfolio and all
instruments held by the Custodian relative thereto and all other property held
by it under this Contract on behalf of each applicable Portfolio and to transfer
to an account of such successor custodian all of the securities of each such
Portfolio held in any Securities System. Thereafter, such bank or trust company
shall be the successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or of
the Board of Trustees to appoint a successor custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.
16. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this Contract, the Custodian and the
Fund on behalf of each of the Portfolios, may from time to time agree on such
provisions interpretive of or in addition to the provisions of this Contract as
may in their joint opinion be consistent with the general tenor of this
Contract. Any such interpretive or additional provisions shall be in a writing
signed by both parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any applicable federal or
state regulations or any provision of the prospectus or the Declaration of Trust
of the Fund. No interpretive or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Contract.
17. ADDITIONAL FUNDS
In the event that the Fund establishes one or more series of Shares in
addition to Alger Money Market Portfolio, Alger Small Capitalization Portfolio,
Alger MidCap Growth Portfolio, Alger Growth Portfolio, Alger Balanced Portfolio
and Alger Capital Appreciation Portfolio with respect to which it desires to
have the Custodian render services as custodian under the terms hereof, it shall
so notify the Custodian in writing, and if the Custodian agrees in writing to
provide such services, such series of Shares shall become a Portfolio hereunder
and such written agreement shall be made a schedule to this Contract.
18. MASSACHUSETTS LAW TO APPLY
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of The Commonwealth of Massachusetts.
19. PRIOR CONTRACTS
This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Fund on behalf of each of the Portfolios and the Custodian
relating to the custody of the Fund's assets.
<PAGE>
20. SHAREHOLDER COMMUNICATIONS ELECTION
Securities and Exchange Commission Rule 14b-2 requires banks which hold
securities for the account of customers to respond to requests by issuers of
securities for the names, addresses and holdngs of beneficial owners of
securities of that issuer held by the bank unless the beneficial owner has
expressly objected to disclosure of this information. In order to comply with
the rule, the Custodian needs the Fund to indicate whether it authorizes the
Custodian to provide the Fund's name, address, and share position to requesting
companies whose securities the Fund owns. If the Fund tells the Custodian "no",
the Custodian will not provide this information to requesting companies. If the
Fund tells the Custodian "yes" or does not check either "yes" or "no" below, the
Custodian is required by the rule to treat the Fund as consenting to disclosure
of this information for all securities owned by the Fund or any funds or
accounts established by the Fund. For the Fund's protection, the Rule prohibits
the requesting company from using the Fund's name and address for any purpose
other than corporate communications. Please indicate below whether the Fund
consents or objects by checking one of the alternative below.
YES [ ] The Custodian is authorized to release the Fund's name, address,
and share positions.
NO [X] The Custodian is not authorized to release the Fund's name,
address, and share positions.
21. LIMITATION OF LIABILITY_
The Fund is a business trust organized under the laws of the Commonwealth
of Massachusetts and under a Declaration of Trust, to which reference is hereby
made, a copy of which is on file at the office of the Secretary of State of the
Commonwealth of Massachusetts, and to any and all amendments thereto so filed or
hereafter filed. The obligations of the Fund entered into hereunder in the name
of the Fund or on behalf thereof by any of its trustees, officers, employees or
agents are undertaken not individually but in such capacities, and are not
binding upon any of the trustees, officers, employees or shareholders of the
Fund personally, but bind only the assets of the Fund or of the particular
Portfolio in question, as the case may be.
22. HEADINGS
The section headings contained in this Contract are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Contract.
<PAGE>
23. NOTICES
Except as may be otherwise provided herein, any notice or other instrument
in writing authorized or required by this Contract to be given by either party
hereto shall be sufficiently given if addressed to such party and mailed or
delivered to it at the address set forth below:
(a) If to the Fund, to:
The Alger Fund
30 Montgomery Street
Jersey City, NJ 07302
Attention: Gregory S. Duch
(b) If the Custodian, to:
State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, MA 02171
Attention: Robert Bagdasarian
or at such other place as the receiving party may from time to time designate in
writing.
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 15 day of July, 1996.
ATTEST THE ALGER FUND
/s/Mary Marsden Cochran /s/ Gregory S. Duch
- ----------------------- By ------------------------------
Mary Marsden Cochran Gregory S. Duch
ATTEST STATE STREET BANK AND TRUST COMPANY
/s/Francine A. Hayes /s/Robert F. Owen
- --------------------- By ------------------------------
Francine A. Hayes Vice/President
<PAGE>
SCHEDULE A
The following foreign banking institutions and foreign securities depositories
have been approved by the Board of Trustees of The Alger Fund for use as
sub-custodians for the Fund's securities and other assets:
Country Subcustodian Central Depository
Austria GiroCredit Bank Oesterreichische
Aktiengesellschaft Kontrollbank AG
der Sparkassen (Wertpapiersammelbank
Division)
Belgium Generale Bank Caisse
Interprofessionnelle
de Depots et de Virements
de Titres S.A. (CIK);
Banque Nationale de
Belgique
Denmark Den Danske Bank Vzrdipapircentralen The
Danish Securities Center
(VP)
Finland Merita Bank Limited The Central Share Register
of Finland
France Banque Paribas Societe
Interprofessionnelle pour
la Compensation des
Valeurs Mobilieres
(SICOVAM);
Banque de France,
Saturne System
Germany Dresdner Bank A.G. The Deutscher
Kassenverein AG
Ireland Bank of Ireland None;
The Central Bank of
Ireland, The Gilt
Settlement Office (GSO)
Italy Morgan Guaranty Trust Monte Titoli S.p.A.:
Company
Banca d'Italia
Netherlands MeesPierson N.V. Nederlands Centraal
Instituut voor Giraal
Effectenverkeer B.V.
(NECIGEF)
Norway Christiania Bank og Verdipapirsentralen
Kreditkasse The Norwegian Registry
of Securities (VPS)
<PAGE>
SCHEDULE A (CONT,)
Country Subcustodian Central Depository
Portugal Banco Comercial Portugues Central de Valores
Mobiliairios (Central)
Spain Banco Santander, S.A. Servicio de Compensacion y
Liquidacion de Valores
(SCLV);
Banco de Espana,
Anotaciones en Cuenta
Sweden Skandinaviska Enskilda Virdepapperscentralen VPC
Banken AB The Swedish Central
Securities Depository
Switzerland Union Bank of Switzerland Schweizerische Effekten
Giro AG (SEGA)
United Kingdom State Street Bank and None:
Trust Company The Bank of England.
The Central Gilts Office
(CGO):
The Central Moneymarkets
Office (CMO)
Euroclear (The Euroclear System)/State Street London Limited
Cedel (Cedel Bank societe anonyme)/State Street London Limited
Certified:
/s/
- ------------------------
Fund's Authorized Officer
Date: 7-15-96
------------
SULLIVAN & WORCESTER LLP
ONE POST OFFICE SQUARE
BOSTON, MASSACHUSETTS 02109
(617) 338-2800
FAX NO. 617-338-2880
IN WASHINGTON, D.C. IN NEW YORK CITY
1025 CONNECTICUT AVENUE, N.W. 767 THIRD AVENUE
WASHINGTON, D.C. 20036 NEW YORK, NEW YORK 10017
(202) 775-8190 (212) 486-8200
FAX NO. 202-293-2275 FAX NO. 212-758-2151
Boston
June 2, 1997
The Trustees of The Alger Fund
75 Maiden Lane
New York, New York 10038
Re: THE ALGER FUND - AMENDMENT TO REGISTRATION STATEMENT ON FORM N1-A
Ladies and Gentlemen:
You have requested our opinion as to certain matters of Massachusetts law
relating to The Alger Fund, a trust with transferable shares (the "TRUST")
established under Massachusetts law pursuant to a Declaration of Trust dated
March 20, 1986 (the "ORIGINAL DECLARATION"), and thereafter from time to time
amended, supplemented and restated (the Original Declaration, as amended,
supplemented and restated to date, the "DECLARATION"). We understand that our
opinion is desired in connection with (i) the filing by the Trust with the
United States Securities and Exchange Commission (the "SEC"), pursuant to the
Securities Act of 1933, as amended (the "1933 ACT") and the Investment Company
Act of 1940, as amended (the "1940 ACT"), of amendments (collectively, the
"AMENDMENT") to the Trust's Registration Statement on Form N1-A (the
"REGISTRATION STATEMENT") under the 1933 Act (File No. 33-4959, and the
Amendment, Post-Effective Amendment No. 23 thereto) and the 1940 Act (File No.
811-6880, and the Amendment, Amendment No. 25 thereto), and (ii) the conversion
of the Registration Statement and the files relating thereto into the SEC's
EDGAR format.
The Trust operates as an investment company of the type known as a
"series fund". Its assets are divided into a total of six separate investment
portfolios, or funds (the "FUNDS", and each singly, a "Fund"), each subject to
its own obligations and having its own investment objectives and shareholders,
distinct from those of the other Funds. Each Fund is treated as a separate
open-end investment company, or mutual fund, for purposes of the 1940 Act. The
beneficial interests in the Trust are represented by shares of beneficial
interest, par value $.001 per share ("SHARES"). The Shares are divided into six
separate series (each, a "SERIES"), one for each Fund, representing the
beneficial interests in that Fund, and the Shares of a Fund provide no
beneficial interest in the assets of any other Fund. At present, the Shares of
The Alger Money Market Portfolio consist of a single class, and the Shares of
The Alger Small Capitalization Portfolio, The Alger Growth Portfolio, the Alger
Balanced Portfolio, the Alger MidCap Growth Portfolio and the Alger Capital
<PAGE>
Appreciation Portfolio (collectively, the "CLASSIFIED FUNDS", and the Shares
thereof, the "CLASSIFIED SERIES"), consist of two classes, designated Class A
and Class B ("CLASSES"), which represent the beneficial interests in the same
portfolio of assets, but are subject to differing expenses, charges and loads,
and accordingly have differing net asset values. The Trustees of the Trust have
authorized the establishment of one additional Class of Shares for each of the
Classified Series, to be designated Class C Shares, and the amendment of the
terms of the Class B Shares of each Classified Series to provide that such Class
B Shares will convert into Class A Shares of the same Series after the
expiration of a certain period of time. We understand that no Class C Shares
have yet been issued, but that the Classified Funds will begin to offer Class C
Shares of their respective Series when the Amendment has become effective. We
further understand that the Registration Statement relates to the unclassified
Shares of The Alger Money-Market Portfolio and to the Class A, Class B and Class
C Shares of each Classified Series.
We acted as Massachusetts counsel to the Trust in connection with the
drafting, execution and delivery of the Original Declaration and the various
amendments and supplements thereto and restatements thereof, the organization of
the Trust and the drafting and adoption of its By-laws, the establishment of the
Funds and of the several Series and Classes of Shares thereof, and the
authorization of such Shares for issue, and for purposes of this opinion we have
examined the amended forms of the Prospectus (the "PROSPECTUS") and Statement of
Additional Information to be filed with the Amendment, certificates of public
officials and of Trustees and officers of the Trust as to matters of fact, and
such other documents and instruments, certified or otherwise identified to our
satisfaction, and such questions of law and fact, as we have considered
necessary or appropriate for purposes of the opinions expressed herein. We have
assumed the genuineness of the signatures on, and the authenticity of, all
documents furnished to us, and the conformity to the originals of documents
submitted to us as certified copies, which facts we have not independently
verified.
Based upon and subject to the foregoing, we hereby advise you that, in our
opinion, under Massachusetts law:
1. The Trust has been duly organized and is validly existing as a trust
with transferable shares of the type commonly called a Massachusetts
business trust, and has all trust right, power and authority under the
Declaration and the laws of Massachusetts, to the extent that such
laws apply, to own its properties and to carry on its business as
described in the Prospectus.
2. The Trust is authorized to issue an unlimited number of Shares of the
Series that represents the beneficial interest in The Alger Money
Market Portfolio, and unlimited numbers of the Class A, Class B and
Class C Shares of each Classified Series.
3. When Shares of the several Series and Classes to which the
Registration Statement relates are issued in the manner and for
consideration determined as stated in the Prospectus, such Shares will
have been validly and legally issued, fully paid and nonassessable by
the Trust, or by the Fund which issued them.
With respect to the opinion stated in paragraph 3 above, we wish to point
out that the shareholders of a Massachusetts business trust may under some
<PAGE>
circumstances be subject to assessment at the instance of creditors to pay the
obligations of such trust in the event that its assets are insufficient for the
purpose.
This letter expresses our opinions as to the provisions of the Declaration
and the laws of The Commonwealth of Massachusetts applying to business trusts
generally, but does not extend to the Massachusetts Securities Act, or to
federal securities or other laws.
We hereby consent to the filing of this letter with the SEC as an exhibit
to the Registration Statement, but we do not thereby concede that we come within
the category of persons whose consent is required under Section 7 of the 1933
Act. We further consent to the reliance on the opinions expressed herein by the
firm of Hollyer Brady Smith Troxell Barrett Rockett Hines & Mone LLP for
purposes of rendering their opinion which is also being filed as an exhibit to
the Registration Statement, concurrently with the filing of this letter.
Very truly yours,
/S/ SULLIVAN & WORCESTER LLP
----------------------------
SULLIVAN & WORCESTER LLP
HOLLYER BRADY SMITH TROXELL
BARRETT ROCKETT HINES & MONE LLP
551 Fifth Avenue
New York, NY 10176
Tel: (212) 818-1110
Fax: (212) 818-0494
June 2, 1997
The Trustees of The Alger Fund
75 Maiden Lane
New York, New York 10038
Gentlemen:
We have acted as counsel to The Alger Fund (the "Fund"), a trust with
transferable shares organized under Massachusetts law pursuant to a Declaration
of Trust (as subsequently amended to date, the "Declaration of Trust"), in
connection with the preparation and filing with the Securities and Exchange
Commission (the "SEC") of an amendment to the Registration Statement of the Fund
on Form N-1A (the "Amendment") under the Securities Act of 1933 (Post-Effective
Amendment No. 23, File No. 33-4959) and the Investment Company Act of 1940
(Amendment No. 25, File No. 811-6880) relating to the public offering of an
indefinite number of shares of beneficial interest, par value $.001 per share,
divided into six separate series of shares, five of which series will be further
divided into three classes (the "Shares").
We have examined copies of the Amendment, the Declaration of Trust and the
By-Laws of the Fund and such certificates of public officials and Trustees and
officers of the Fund and other documents, certified or otherwise identified to
our satisfaction, and such questions of law and fact, as we have deemed
necessary for purposes of the opinions expressed herein. In our examination, we
have assumed the genuineness of the signatures on, and the authenticity of, all
documents furnished to us and the conformity to the originals of documents
submitted to us as copies. Insofar as this opinion relates to the law of the
Commonwealth of Massachusetts applying to business trusts, we have relied on the
opinion of the firm of Sullivan & Worcester LLP, which we understand is being
filed as an exhibit to the Amendment and a copy of which is being delivered with
this opinion.
Based upon and subject to the foregoing, it is our opinion that:
1. The Fund has been duly organized and is validly existing under
the laws of Massachusetts as a trust of the type commonly
known as a Massachusetts business trust.
2. When Shares of the several series and classes to which the
Amendment relates are issued in the manner and for
consideration as stated therein, such Shares will have been
legally issued, fully paid and nonassessable.
With respect to the opinion stated in paragraph 2 above, we note that the
shareholders of a Massachusetts business trust may under some circumstances be
subject to assessment at the instance of creditors to pay the obligations of the
trust in the event that its assets are insufficient for that purpose.
We consent to the filing of this opinion as an exhibit to the Amendment.
Very truly yours,
HOLLYER BRADY SMITH TROXELL
BARRETT ROCKETT HINES & MONE LLP
By:/s/ Robert I. Jones
-------------------------------------
Robert I. Jones, a member of the firm
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
As independent public accountants, we hereby consent to the incorporation by
reference of our report dated December 4, 1996 on the financial statements of
The Alger Fund for the year ended October 31, 1996 and to all references to our
Firm included in or made a part of the registration statement of The Alger Fund
filed on Form N-1A (Amendment No. 25), Investment Company Act File No. 811-6880
with the Securities and Exchange Commission.
/s/ARTHUR ANDERSEN LLP
-------------------
ARTHUR ANDERSEN LLP
New York, New York
June 2, 1997
Exhibit 13
THE ALGER FUND
NEW ACCOUNT APPLICATION
Remember to sign and date this application (See Section 10)
PLEASE DO NOT USE THIS APPLICATION FOR AN IRA. IF YOU HAVE QUESTIONS ABOUT
COMPLETING THIS APPLICATION OR NEED AN IRA APPLICATION, PLEASE CALL
1-800-992-3863.
RETURN YOUR COMPLETED APPLICATION IN THE POSTPAID ENVELOPE OR MAIL TO:
ALGER SHAREHOLDER SERVICES, INC.
30 MONTGOMERY STREET
JERSEY CITY, NJ 07302
Please print
1 YOUR ACCOUNT REGISTRATION
(CHECK ONE BOX)
/ / INDIVIDUAL OR JOINT ACCOUNT
................................................................................
Owner's Name: (First, Middle Initial, Last)
................................................................................
Owner's Social Security Number
................................................................................
Joint Owner's Name: (First, Middle Initial, Last)
Joint accounts will be registered joint tenants with the right of survivorship,
unless otherwise indicated.
- --------------------------------------------------------------------------------
/ / GIFT OR TRANSFER TO MINOR
................................................................................
Custodian's Name (One Name Only: First, Middle Initial, Last)
................................................................................
Minor's Name (One Name Only: First, Middle Initial, Last)
Under the..................................Uniform Gifts/Transfers to Minors Act
(State of Minor's residence)
Minor's Social Security Number..................................................
- --------------------------------------------------------------------------------
/ / TRUST (Please include copy of first and last page of trust agreement)
................................................................as trustee(s) of
Trustee(s)' Name
..............................................................for the benefit of
Name of Trust
................................................................................
Beneficiary's Name
................................................................................
Taxpayer ID Number Full Date of Trust Agreement
- --------------------------------------------------------------------------------
/ / CORPORATION PARTNERSHIP, OR OTHER ENTITY
................................................................................
Name of Corp. or Other Entity
................................................................................
Taxpayer ID Number..............................................................
Please include copy of corporate resolution or call 1-800-992-3863 for
additional forms.
- --------------------------------------------------------------------------------
2 YOUR ADDRESS
................................................................................
Street or P.O. Box Number
................................................................................
City State Zip
Citizenship: / / U.S. / / Resident / /Non-Resident...................
Alien Alien Specify Country
( ) ( )
................................................................................
Daytime Phone Evening Phone
- --------------------------------------------------------------------------------
3 INVESTMENT INSTRUCTIONS
($500 minimum required for each portfolio unless you are signing up for the
Automatic Investment Plan. If no selection is made below, we will invest the
proceeds into The Alger Money Market Portfolio
Alger Money Market Portfolio $..................................................
CLASS A CLASS B
(Initial Sales Charge) (Contingent Deferred
Sales Charge)
Alger Growth Portfolio $.................... $....................
Alger MidCap Growth Portfolio $.................... $....................
Alger Small Capitalization
Portfolio $.................... $....................
Alger Capital
Appreciation
Portfolio $.................... $....................
Alger Balanced
Portfolio $.................... $....................
TOTAL $.................... $....................
<PAGE>
MY/OUR INITIAL INVESTMENT IS BEING MADE BY:
/ / CHECK Made payable to THE ALGER FUND. We do not accept third party
checks.
/ / WIRE to purchase shares by federal funds or bank wire, first call
1-800-992-3863.
..........................
Date Wired
- --------------------------------------------------------------------------------
4 DIVIDEND AND CAPITAL GAIN PAYMENT OPTIONS
UNLESS A BOX IS CHECKED, ALL DISTRIBUTIONS WILL BE REINVESTED IN SHARES.
Dividends Capital Gains
REINVEST IN SHARES / / / /
PAY IN CASH / / / /
(over)
- --------------------------------------------------------------------------------
ALGER CHECK WRITING SIGNATURE CARD ON REVERSE
<PAGE>
New Account Application (continued)
5 TELEPHONE PRIVILEGES
A. TELEPHONE EXCHANGE OPTION
/ / Yes, I/We wish to be able to exchange shares amount Portfolios of the
same class by telephone.
B. TELEPHONE CHECK REDEMPTION OPTION
/ / Yes, I/We authorize The Alger Fund to honor check redemption requests
by telephone to the address of record. Any request for redemption proceeds
to be sent to the address of record must be in writing with the
signature(S) guaranteed if made within 60 days of changing your address.
C. TELEPHONE WIRE REDEMPTION OPTION
MINIMUM $2,500
/ / Yes, I/We authorize The Alger Fund to honor wire redemption requests by
telephone to the bank account indicated below.
D. TELEPURCHASE/TELEREDEMPTION OPTION
MINIMUM $500, MAXIMUM $50,000
/ / Yes, I/We wish to establish the TelePurchase/TeleRedemption
option--permits transfer of money by telephone between my designated bank
account below and my Alger Fund account. Your bank must be a member of the
Automated Clearing House.
BANK ACCOUNT INFORMATION
(complete if requesting Telephone Wire Redemption Option and/or
TelePurchase/TeleRedemption Option above)
A VOIDED CHECK MUST BE ATTACHED HERE.
................................................................................
Bank Name Routing Number
................................................................................
Bank Address
................................................................................
City State ZIP
................................................................................
Account Name Account Number
- ------------------------------------------------------------------------
6 LETTER OF INTENT - CLASS A SHARES ONLY
/ / I agree to the terms of the Letter of Intent set forth in the
Prospectus. Although I am not obligated to do so, it is my intention to
invest over a 13-month period in Class A shares of one or more Alger Fund
Portfolios in an aggregate amount at lease equal to:
/ / $100,000 / / $250,000 / / $500,000 / / $1,000,000
(Note: For a letter of intent, the minimum initial investment must equal at
least 5% of the intended amount.)
- ------------------------------------------------------------------------
7 MONEY MARKET PORTFOLIO ONLY
CHECK WRITING OPTION ($500 MINIMUM)
/ / YES, I/we wish to take advantage of the Money Market Portfolio
checkwriting option.
FOR JOINT ACCOUNTS ONLY
/ / We require both owners' signature to appear on redemption checks. If
you do not check this box, redemption checks signed by either owner will be
accepted.
- ------------------------------------------------------------------------
CHECK WRITING SIGNATURE CARD
PLEASE SIGN HERE: (EXACTLY AS YOU WILL SIGN ON CHECKS)
(MINIMUM CHECK AMOUNT IS $500.00
................................................................................
Print Name
................................................................................
Signature
................................................................................
Print Name
................................................................................
Signature
A/C.............................................................................
- --------------------------------------------------------------------------------
8 AUTOMATIC INVESTMENT PLAN
/ / Check here to authorize a monthly amount ($25 minimum per Portfolio) to
be debited from your bank account to purchase shares in your specified
Alger Portfolio(s). The withdrawal will occur on the last business day of
the month. Attach a VOIDED check from your bank account to ensure proper
processing. Any co-signer of the bank account who is not a joint owner of
the Alger Fund account must authorize this service by signing below.
YOUR BANK MUST BE A MEMBER OF THE AUTOMATED CLEARING HOUSE.
MONTHLY AMOUNT $......................................$25 MINIMUM PER PORTFOLIO)
PORTFOLIO ALLOCATION:
Alger Money Market Portfolio $.............................................
CLASS A CLASS B
(Initial Sales Charge) (Contingent Deferred
Sales Charge)
Alger Growth Portfolio $.................... $....................
Alger MidCap Growth
Portfolio $.................... $....................
Alger Small
Capitalization
Portfolio $.................... $....................
Alger Capital
Appreciation
Portfolio $.................... $....................
Alger Balanced
Portfolio $.................... $....................
TOTAL $.................... $....................
................................................................................
Co-signer Authorization Date
- --------------------------------------------------------------------------------
9 AUTOMATIC EXCHANGE PLAN
/ / Check here to authorize an Automatic Exchange ($25 minimum per
Portfolio) from the Alger Money Market Portfolio to one (or all) of The
Alger Fund Portfolios of the same class. The Automatic Exchange will occur
on or about the fifteenth day of each month and will be invested in the
Portfolio(s) selected below. Class A shares may be subject to an initial
sales charge.
MONTHLY AMOUNT $.....................................($25 MINIMUM PER PORTFOLIO)
PORTFOLIO ALLOCATION:
CLASS A CLASS B
(Initial Sales Charge) (Contingent Deferred
Sales Charge)
Alger Growth Portfolio $.................... $....................
Alger MidCap Growth
Portfolio $.................... $....................
Alger Small
Capitalization
Portfolio $.................... $....................
Alger Capital
Appreciation
Portfolio $.................... $....................
Alger Balanced
Portfolio $.................... $....................
- --------------------------------------------------------------------------------
10 SIGNATURES AND TAXPAYER CERTIFICATION
The undersigned warrant(s) that I(we) have full authority and, if a natural
person, I(we) am (are) of legal age to purchase shares pursuant to this
application, have received a current Alger Fund Prospectus and agree to be bound
by its terms.
According to the Interest and Dividend Tax Compliance Act of 1983, we are
required to have the following certification: under the penalties of perjury, I
certify that (i) the number shown in section 1 is my correct Social
Security/Taxpayer Identification Number or I have applied, or will apply, for
such a number and will provide it within sixty (60) days after signing this
application, and (ii) I am not subject to backup withholding because the IRS has
(a) not notified me that I am subject to backup withholding as a result of
failure to report all interest or dividends, or (b) has rescinded a previously
imposed backup withholding requirement. If you are subject to backup
withholding, please cross out Number (ii) above.
The Internal Revenue Service does not require your consent to any provision of
this document other than the certifications required to avoid backup
withholding.
X...............................................................................
Signature Date
X...............................................................................
Signature Date
- --------------------------------------------------------------------------------
BROKER DEALER INFORMATION (FOR BROKER USE ONLY)
................................................................................
Name of Broker/Dealer Firm Broker Dealer #
................................................................................
Branch Office Address
................................................................................
Branch Office #
................................................................................
Rep Name Rep #
................................................................................
Rep Phone #
A17
Exhibit 13(a)
PURCHASE AGREEMENT
------------------
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, and Fred Alger Management,
Inc. ("Alger"), hereby agree as follows:
1. The Fund hereby offers Alger and Alger hereby purchases one
(1) share of beneficial interest of the Fund, par value $.001
per share (the "Share"), consisting of one (1) Share in the
Alger Balanced Portfolio, at a price of $10.00 per share.
Alger hereby acknowledges receipt of the Share acquired in the
Portfolio and the Fund hereby acknowledges receipt from Alger
of $10.00 in full payment for the Share.
2. Alger represents and warrants to the Fund that the Share is
being acquired for investment purposes and not for the purpose
of distribution.
3. Alger agrees that if it redeems the Share before five years
after the date of this Agreement, it will pay to the Fund an
amount that is equal to the number resulting from multiplying
the Fund's total unamortized organizational expenses allocable
to the Portfolio by a fraction, the numerator of which is
equal to the number of Shares of the Portfolio redeemed and
the denominator of which is equal to the aggregate number of
Shares of the Portfolio outstanding at the time of such
redemption.
4. The Fund represents that a copy of its Agreement and
Declaration of Trust, dated March 20, 1986, together with all
amendments thereto, is on file in the office of the Secretary
of the Commonwealth of Massachusetts.
5. This Agreement has been executed on behalf of the Fund by
the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
be binding upon the assets and property of the Fund only and
shall not be binding upon any Trustee, officer or shareholder
of the Fund individually.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the 30th day of March, 1992.
THE ALGER FUND
By: /s/Gregory S. Duch
------------------------
ATTEST:
/s/Nanci Staple
- ------------------------
FRED ALGER MANAGEMENT, INC.
By: /s/Gregory S. Duch
------------------------
ATTEST:
/s/Nanci Staple
- ------------------------
Exhibit 13(b)
PURCHASE AGREEMENT
------------------
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, and Fred Alger Management,
Inc. ("Alger"), hereby agree as follows:
1. The Fund hereby offers Alger and Alger hereby purchases one
(1) share of beneficial interest of the Fund, par value $.001
per share (the "Share"), consisting of one (1) Share in the
Alger MidCap Growth Portfolio, at a price of $10.00 per share.
Alger hereby acknowledges receipt of the Share acquired in the
Portfolio and the Fund hereby acknowledges receipt from Alger
of $10.00 in full payment for the Share.
2. Alger represents and warrants to the Fund that the Share is
being acquired for investment purposes and not for the purpose
of distribution.
3. Alger agrees that if it redeems the Share before five years
after the date of this Agreement, it will pay to the Fund an
amount that is equal to the number resulting from multiplying
the Fund's total unamortized organizational expenses allocable
to the Portfolio by a fraction, the numerator of which is
equal to the number of Shares of the Portfolio redeemed and
the denominator of which is equal to the aggregate number of
Shares of the Portfolio outstanding at the time of such
redemption.
4. The Fund represents that a copy of its Agreement and
Declaration of Trust, dated March 20, 1986, together with all
amendments thereto, is on file in the office of the Secretary
of the Commonwealth of Massachusetts.
5. This Agreement has been executed on behalf of the Fund by
the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
be binding upon the assets and property of the Fund only and
shall not be binding upon any Trustee, officer or shareholder
of the Fund individually.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the 26th day of April, 1993.
THE ALGER FUND
By: /s/Gregory S. Duch
------------------------
ATTEST:
/s/Nanci Staple
- ------------------------
FRED ALGER MANAGEMENT, INC.
By: /s/Gregory S. Duch
------------------------
ATTEST:
/s/Nanci Staple
- ------------------------
Exhibit 13(c)
PURCHASE AGREEMENT
------------------
The Alger Fund (the "Fund"), an unincorporated business trust organized under
the laws of the Commonwealth of Massachusetts, and Fred Alger Management, Inc.
("Alger"), hereby agree as follows:
1. The Fund hereby offers Alger and Alger hereby purchases one
(1) share of beneficial interest of the Fund, par value $.001 per
share (the "Share"), consisting of one (1) Share in the Alger
Leveraged AllCap Portfolio, at a price of $10.00 per share. Alger
hereby acknowledges receipt of the Share acquired in the Portfolio
and the Fund hereby acknowledges receipt from Alger of $10.00 in
full payment for the Share.
2. Alger represents and warrants to the Fund that the Share is
being acquired for investment purposes and not for the purpose of
distribution.
3. Alger agrees that if it redeems the Share before five years
after the date of this Agreement, it will pay to the Fund an amount
that is equal to the number resulting from multiplying the Fund's
total unamortized organizational expenses allocable to the Portfolio
by a fraction, the numerator of which is equal to the number of
Shares of the Portfolio redeemed and the denominator of which is
equal to the aggregate number of Shares of the Portfolio outstanding
at the time of such redemption.
4. The Fund represents that a copy of its Agreement and
Declaration of Trust, dated March 10, 1986, together with all
amendments thereto, is on file in the office of the Secretary of the
Commonwealth of Massachusetts.
5. This Agreement has been executed on behalf of the Fund by
the undersigned officer of the Fund in his capacity as an officer of
the Fund. The obligations of this Agreement shall be binding upon
the assets and property of the Fund only and shall not be binding
upon any Trustee, officer or shareholder of the Fund individually.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 15th day of October, 1993.
THE ALGER FUND
By:/s/Gregory Duch
------------------------
ATTEST:
/s/Nanci Staple
---------------------------
FRED ALGER MANAGEMENT, INC.
By:/s/Gregory Duch
------------------------
ATTEST:
/s/Nanci Staple
---------------------------
Exhibit 13(d)
PURCHASE AGREEMENT
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, and Fred Alger Management,
Inc. ("Alger"), hereby agree as follows:
1. The Fund hereby offers Alger and Alger hereby purchases one
(1) share of beneficial interest of the Fund, par value $.001 per share
(the "Share"), consisting of one (1) Share in the Alger Small
Capitalization Portfolio, at a price of $10.00 per share. Alger hereby
acknowledges receipt of the Share acquired in the Portfolio and the Fund
hereby acknowledges receipt from Alger of $10.00 in full payment for the
Share.
2. Alger represents and warrant to the Fund that the
Share is being acquired for investment purposes and not for the
purpose of distribution.
3. Alger agrees that if it redeems the Share before five years
after the date of this Agreement, it will pay to the Fund an amount that
is equal to the number resulting from multiplying the Fund's total
unamortized organizational expenses allocable to the Portfolio by a
fraction, the numerator of which is equal to the number of Shares of the
Portfolio redeemed and the denominator of which is equal to the
aggregate number of Shares of the Portfolio outstanding at the time of
such redemption.
4. The Fund represents that a copy of its Agreement and
Declaration of Trust, dated March 10, 1986, together with all amendments
thereto, is on file in the office of the Secretary of the Commonwealth
of Massachusetts.
5. This Agreement has been executed on behalf of the Fund by the
undersigned officer of the Fund in his capacity as an officer of the
Fund. The obligations of this Agreement shall be binding upon the assets
and property of the Fund only and shall not be binding upon any Trustee,
officer or shareholder of the Fund individually.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the _________ day of ________________, 1986.
THE ALGER FUND
By: ____________________
ATTEST:
________________________
FRED ALGER MANAGEMENT, INC.
By: ____________________
ATTEST:
________________________
Exhibit 13(e)
PURCHASE AGREEMENT
The Alger Fund (the "Fund"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, and Fred Alger Management,
Inc. ("Alger"), hereby agree as follows:
1. The Fund hereby offers Alger and Alger hereby purchases one
(1) share of beneficial interest of the Fund, par value $.001 per share
(the "Share"), consisting of one (1) Share in the Alger Growth
Portfolio, at a price of $10.00 per share. Alger hereby acknowledges
receipt of the Share acquired in the Portfolio and the Fund hereby
acknowledges receipt from Alger of $10.00 in full payment for the Share.
2. Alger represents and warrants to the Fund that the Share is
being acquired for investment purposes and not for the purpose of
distribution.
3. Alger agrees that if it redeems the Share before five years
after the date of this Agreement, it will pay to the Fund an amount that
is equal to the number resulting from multiplying the Fund's total
unamortized organizational expenses allocable to the Portfolio by a
fraction, the numerator of which is equal to the number of Shares of the
Portfolio redeemed and the denominator of which is equal to the
aggregate number of Shares of the Portfolio outstanding at the time of
such redemption.
4. The Fund represents that a copy of its Agreement and
Declaration of Trust, dated March 10, 1986, together with all amendments
thereto, is on file in the office of the Secretary of the Commonwealth
of Massachusetts.
5. This Agreement has been executed on behalf of the Fund by the
undersigned officer of the Fund in his capacity as an officer of the
Fund. The obligations of this Agreement shall be binding upon the assets
and property of the Fund only and shall not be binding upon any Trustee,
officer or shareholder of the Fund individually.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the _____ day of ___________, 1986.
THE ALGER FUND
By: _______________________
ATTEST:
______________________________
FRED ALGER MANAGEMENT, INC.
By:_______________________
ATTEST:
______________________________
EXHIBIT 15
THE ALGER FUND
--------------
PLAN OF DISTRIBUTION
--------------------
This Plan of Distribution (the "Plan") is adopted in accordance
with Rule 12b-1 (the "Rule") under the Investment Company Act of 1940, as
amended (the "Act"), by The Alger Fund, an unincorporated business trust
organized under the laws of the Commonwealth of Massachusetts (the "Fund"),
subject to the following terms and conditions:
Section 1. REIMBURSEMENT OF EXPENSES.
The Fund will reimburse the distributor of its shares, Fred
Alger & Company, Incorporated ("Alger"), for certain expenses incurred by Alger
in connection with the offering and sale of shares of beneficial interest of
each of the Fund's portfolios other than the Alger Money Market Portfolio (each
a "Portfolio" and, collectively, the "Portfolios"). The Fund may reimburse Alger
for distribution expenses at an annual rate not exceeding 1.00% of the average
daily net assets of each of the Portfolios. Any contingent deferred sales
charges received by Alger will also be used in defraying expenses related to the
distribution of shares of the Portfolios. Amounts so received will reduce the
amount of total expenses for which reimbursement may be sought under the Plan.
Distribution expenses incurred in a year in excess of contingent deferred sales
charges received by Alger relating to redemptions of shares of a Portfolio
during that year and 1.00 percent of the Portfolio's average daily net assets
may be carried forward and sought to be reimbursed in future years. Interest at
the prevailing broker loan rate may be charged to the Portfolios on any expenses
carried forward.
Section 2. EXPENSES COVERED by the Plan.
The Fund may reimburse Alger under Section 1 of the Plan for
any expenses primarily intended to result in the sale of the Portfolios'
shares, including, but not limited to: (a) payments to and expenses of persons
who service shareholder accounts, including, but not limited to, answering
routine inquiries regarding the Portfolios, processing shareholder transactions
and providing any other shareholder services not otherwise provided by the
Fund's transfer agent; (b) costs relating to the formulation and implementation
of marketing and promotional activities, including, but not limited to, direct
mail promotions and television, radio, newspaper, magazine and other mass media
advertising; (c) costs of printing and distributing prospectuses, statements of
additional information and reports of the Fund to prospective shareholders of
the Portfolios; (d) costs involved in preparing, printing and
<PAGE>
distributing sales literature pertaining to the Portfolios; and (e) costs
involved in obtaining whatever information, analyses and reports with respect to
marketing and promotional activities on behalf of the Portfolios that the Fund
may, from time to time, deem advisable.
Section 3. APPROVAL BY SHAREHOLDERS.
The Plan will not take effect with respect to a Portfolio, and
no fee will be payable in accordance with Section 1 of the Plan, until the Plan
has been approved by a vote of at least a majority of the outstanding voting
securities of the Portfolio.
Section 4. APPROVAL BY TRUSTEES.
Neither the Plan nor any related agreements will take effect
until approved by a majority vote of both (a) the full Board of Trustees of the
Fund and (b) those Trustees 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 it (the "Qualified Trustees"), cast in person at a
meeting called for the purpose of voting on the Plan and the related agreements.
Section 5. CONTINUANCE OF THE PLAN.
The Plan will continue in effect for so long as its continuance
is specifically approved at least annually by the Fund's Board of Trustees in
the manner described in Section 4 above.
Section 6. TERMINATION.
The Plan may be terminated with respect to a Portfolio at any
time by a majority vote of the Qualified Directors or by vote of a majority of
the outstanding voting securities of the Portfolio.
SECTION 7. AMENDMENTS.
The Plan may not be amended so as to increase materially the
amount of reimbursement described in Section 1 above, unless the amendment is
approved by a vote of at least a majority of the outstanding voting securities
of the affected Portfolio. In addition, no material amendment to the Plan may be
made unless approved by the Fund's Board of Trustees in the manner described in
Section 4 above.
-2-
<PAGE>
Section 8. SELECTION OF CERTAIN TRUSTEES.
While the Plan is in effect, the selection and nomination of
the Fund's Trustees who are not interested persons of the Fund will be committed
to the discretion of the Trustees then in office who are not interested persons
of the Fund.
Section 9. WRITTEN REPORTS.
In each year during which the Plan remains in effect, any
person authorized to direct the disposition of monies paid or payable by the
Portfolios pursuant to the Plan or any related agreement will prepare and
furnish to the Fund's Board of Trustees, and the Board will review, at least
quarterly, written reports, complying with the requirements of the Rule, which
set forth the amounts expended under the Plan and the purposes for which those
expenditures were made.
Section 10. PRESERVATION OF MATERIALS.
The Fund will preserve copies of the Plan, any agreement
relating to the Plan and any report made pursuant to Section 9 above, for a
period of not less than six years (the first two years in an easily accessible
place) from the date of the Plan, agreement or report.
Section 11. Meanings of Certain Terms.
As used in the Plan, the terms "interested person" and
"majority of the outstanding voting securities" will be deemed to have meanings
that those terms have under the Act and the rules thereunder subject to any
exemption that may be granted to the Fund under the Act by the Securities and
Exchange Commission.
IN WITNESS WHEREOF, the Fund has executed the Plan
as of October 24, 1986.
THE ALGER FUND
By: /s/
--------------------------
Authorized Officer
Exhibit 15(b)
CLASS "C" SHARE
DISTRIBUTION PLAN
OF
THE ALGER FUND
Distribution Plan, dated as of , 1994, of The Alger Fund, a Massachusetts
business trust ("the Fund"), with respect to Class C shares to be issued by one
or more series of the Trust.
Section I. One or more series of the Fund as listed in Schedule A (herein
after each such series is referred to as a "Portfolio") may act as a distributor
of the shares of the Class C Shares (the "Shares") of which the Fund is the
issuer, pursuant to Rule 12b-1 under the Investment Company Act of 1940, as
amended (the "1940 Act") according to the terms of this Distribution Plan (the
"Plan").
Section 2. Each Portfolio may incur, as a distributor of the Shares,
expenses at the annual rate of 0.75% of the average daily net assets of the
Portfolio attributable to the Shares, subject to any applicable limitations
imposed from time to time by rules of the National Association of Security
Dealers, Inc.
Section 3. Amounts set forth in Section 2 may be used to finance any
activity which is primarily intended to result in the sale of the Shares,
including, but not limited to, expenses of organizing and conducting sales
seminars, advertising programs, finders fees, printing of prospectuses and
statements of additional information (and supplements thereto) and reports for
other than existing shareholders, preparation and distribution of advertising
material and sales literature, overhead, supplemental payments to dealers and
other institutions as asset-based sales charges or as payments of commissions or
service fees by the Fund's distributor and the costs of administering the Plan.
To the extent that amounts paid hereunder are not used specifically to reimburse
the distributor for any such expense, such amounts may be treated as
compensation for the distributor distribution-related services. All amounts
expended pursuant to the Plan shall be paid to the distributor for and are the
legal obligation of the Fund and not of the distributor.
Section 4. This Plan shall not take effect until it has been approved,
together with any related agreements, by votes of the majority of both (a) the
Board of Trustees of the Fund and (b) those trustees of the Fund who are not
"interested persons" of the Fund (as defined in the 1940 Act) and have no direct
or indirect financial interest in the operation of this Plan or any agreements
related to it (the "Non-interested Trustees"), cast in person at a meeting
called for the purpose of voting on this Plan or such agreements.
Section 5. Unless sooner terminated pursuant to Section 7, this Plan shall
continue in effect for a period of one year from the date it takes effect and
thereafter shall continue in effect so long as such continuance is specifically
approved at least annually in the manner provided in Section 4.
Section 6. Distributors shall provide to the Board of Trustees and the
Board of Trustees shall review, at least quarterly, a written report of the
amounts so expended and the purposes for which such expenditures were made.
Section 7. This Plan may be terminated at any time by vote of a majority of
the Non-interested Trustees, or by vote of a majority of the outstanding voting
securities of the Shares.
Section 8. Any agreement related to this Plan shall be made in writing, and
shall provide:
(a) that such agreement may be terminated at any time, without payment
of any penalty, by vote of a majority of the Non-interested Trustees or by
a vote of the outstanding voting securities of the Fund attributable to the
Shares, on not more than sixty (60) days' written notice to any other party
to the agreement; and
(b) that such agreement shall terminate automatically in the event of
the assignment.
Section 9. This Plan may not be amended to increase materially the amount
of distribution expenses provided for in Section 2 hereof unless such amendment
is approved by a vote of at least a "majority of the outstanding securities" (as
defined in the 1940 Act) of the Shares, and no material amendment to the Plan
shall be made unless approved in the manner provided for in Section 4 hereof.
Schedule A
Portfolios in Program
Alger Small Capitalization Alger Balanced
Alger MidCap Growth Alger Capital Appreciation
Alger Growth
THE ALGER FUND
(Class C Shares)
Attest: _______________________ By:_______________________
Name: Name:
Title: Title:
Plan in effect as of ________________, 1997
AVERAGE ANNUAL RETURN COMPUTATION
The Average Annual Return for each Portfolio
was computed according to the following formula:
n
FORMULA: P(1+T) = ERV
Where: P = a hypothetical investment of $1,000
T = average annual total return
n = number of years
ERV = Ending Redeemable Value of a hypothetical
$1,000 payment made at the beginning of
the 1, 5, or 10 year (or other) periods at the
end of the 1, 5, or 10 year (or other)
periods (or fractional portion thereof)
<TABLE>
<CAPTION>
ENDING AVERAGE
PERIOD REDEEMABLE ANNUAL RATE
PORTFOLIO COVERED VALUE OF RETURN FORMULA *
- --------- ------- ---------- ----------- ---------
CLASS A:
<S> <C> <C> <C> <C>
ALGER SMALL 1/1/97 (commencement of
CAPITALIZATION: operations) through 4/30/97** 837.70 -16.23 @RATE(837.70,1000,1)
ALGER GROWTH: 1/1/97 (commencement of
operations) through 4/30/97** 981.89 -1.81 @RATE(981.89,1000,1)
ALGER BALANCED: 1/1/97 (commencement of
operations) through 4/30/97** 978.37 -2.16 @RATE(978.37,1000,1)
ALGER MIDCAP GROWTH: 1/1/97 (commencement of
operations) through 4/30/97** 910.21 -8.98 @RATE(910.21,1000,1)
ALGER CAPTIAL 1/1/97 (commencement of
APPRECIATION operations) through 4/30/97** 956.91 -4.31 @RATE(956.91,1000,1)
CLASS B:
ALGER SMALL
CAPITALIZATION: 10 YEARS ENDED 4/30/97 3,886.09 14.54 @RATE(3886.09,1000,10)
5 YEARS ENDED 4/30/97 1,767.00 12.06 @RATE(1767.00,1000,5)
YEAR ENDED 4/30/97 789.32 -21.07 @RATE(789.32,1000,1)
ALGER GROWTH: 10 YEARS ENDED 4/30/97 3,679.65 13.91 @RATE(3679.65,1000,10)
5 YEARS ENDED 4/30/97 2,212.76 17.22 @RATE(2212.76,1000,5)
YEAR ENDED 4/30/97 1,017.46 1.75 @RATE(1017.46,1000,1)
ALGER BALANCED: 6/1/92 (commencement of
operations) through 4/30/97*** 1,490.55 8.46 @RATE(1490.55,1000,4.92)
YEAR ENDED 4/30/97 992.76 -0.72 @RATE(992.76,1000,1)
ALGER MIDCAP GROWTH: 5/24/93 (commencement of
operations) through 4/30/97**** 2,001.63 19.28 @RATE(2001.63,1000,3.94)
YEAR ENDED 4/30/97 903.52 -9.65 @RATE(903.52,1000,1)
ALGER CAPTIAL 11/1/93 (commencement of
APPRECIATION: operations) through 4/30/97***** 2,219.40 25.61 @RATE(2219.40,1000,3.50)
YEAR ENDED 4/30/97 930.78 -6.92 @RATE(930.78,1000,1)
* LOTUS 123 @RATE FUNCTION:
@RATE(FV,PV,TERM) The periodic interest rate necessary for
present value "pv", to grow to future
value "fv", over the number of compounding periods in "term".
** Not annualized.
*** Period equals 4.92 years.
**** Period equals 3.94 years.
***** Period equals 3.50 years.
</TABLE>
Exhibit 19 (a)
THE ALGER FUND
Alger Balanced Portfolio
Rule 18f-3
Multiple Class Plan, as Amended
The ALGER BALANCED PORTFOLIO (the "Portfolio") of THE ALGER FUND (the
"Fund"), has elected to rely on Rule 18f-3 under the Investment Company Act of
1940, as amended (the "1940 Act"), in offering multiple classes of shares with
differing distribution arrangements, voting rights and exchange and conversion
features.
Pursuant to Rule 18f-3, the Board of Trustees of the Fund has approved and
adopted this amended written plan (the "Plan") specifying all of the differences
among the classes of shares to be offered by the Portfolio. Prior to such
offering, the Plan will be filed as an exhibit to the Fund's registration
statement. The Plan sets forth all the differences among the classes including
those, if any, pertaining to shareholder services, distribution arrangements,
expense allocations, and conversion or exchange features.
I. ATTRIBUTES OF SHARE CLASSES
This section discusses the attributes of the various classes of shares.
Each share of the Portfolio represents an equal pro rata interest in the
Portfolio and has identical voting rights, powers, qualifications, terms and
conditions and, in proportion to each share's net asset value, liquidation
rights and preferences. The classes differ in that: (a) each class has a
different class designation; (b) only the Class A Shares are subject to a
front-end sales charge ("FESC"); (c) only the Class B and Class C Shares are
subject to contingent deferred sales charges ("CDSCs"), except that certain
Class A Shares may also be subject to a CDSC; (d) only the Class B and Class C
Shares (as described below) are subject to distribution fees under plans adopted
pursuant to Rule 12b-1 under the 1940 Act (each a "Rule 12b-1 Plan"); (e) to the
extent that one class alone is affected by a matter submitted to a vote of the
shareholders, then only that class has voting power on the matter; (f) the
exchange privileges of each class differ from those of the other; and (g) as
described below, Class B and Class C Shares will automatically convert to Class
A Shares after designated holding period.(1)
A. CLASS A SHARES
Class A Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class A Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class A Shares are sold subject to the current maximum
FESC (with scheduled variations or elimination of the sales charge, as
permitted by the 1940 Act), except that certain Class A Shares for which
the FESC has been eliminated may instead be subject to a CDSC.
2. DISTRIBUTION AND SERVICE FEES. Class A Shares are not subject to a
Rule 12b-1 distribution fee. However, they are, like the Class B and Class
C Shares, subject to a shareholder servicing fee not to exceed .25% of the
average daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses are allocated particularly to Class A
Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class A Shares are
exchangeable for Class A Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class A Shares have no
conversion features.
B. CLASS B SHARES
Class B Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class B Shares under the exchange privileges
of the Fund. Shares of the Fund outstanding on the date that multiple classes of
shares were first made available have been redesignated Class B Shares.
1. SALES LOADS. Class B Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class B Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class B and, like the Class A and Class C
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class B Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class B Shares are
exchangeable for Class B Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class B shares
automatically convert to Class A Shares eight years after purchase as set
forth in the prospectus of the Fund.
C. CLASS C SHARES
Class C Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class C Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class C Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class C Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class C and, like the Class A and Class B
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class C Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class C Shares are
exchangeable for Class C Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class C shares
automatically convert to Class A Shares twelve years after purchase as set
forth in the prospectus of the Fund.
D. ADDITIONAL CLASSES
In the future, the Portfolio may offer additional classes of shares which
differ from the classes discussed above. However, any additional classes of
shares must be approved by the Board, and the Plan must be amended to describe
those classes.
II. APPROVAL OF MULTIPLE CLASS PLAN
The Board of the Fund, including a majority of the independent Trustees,
must approve the Plan initially. In addition, the Board must approve any
material changes to the classes and the Plan prior to their implementation. The
Board must find that the Plan is in the best interests of each class
individually and the Portfolio as a whole. In making its findings, the Board
should focus on, among other things, the relationships among the classes and
examine potential conflicts of interest among classes regarding the allocation
of fees, services, waivers and reimbursements of expenses, and voting rights.
Most significantly. the Board should evaluate the level of services provided to
each class and the cost of those services to ensure that the services are
appropriate and that the costs thereof are reasonable. In accordance with the
foregoing provisions of this Section II, the Board of the Fund has approved and
adopted this Plan, as amended, as of the date written below. III. Dividends and
Distributions
III. DIVIDENDS AND DISTRIBUTIONS
Because of the differences in fees paid under a Rule 12b-1 Plan, the
dividends payable to shareholders of Class A Shares will differ from the
dividends payable to shareholders of the other classes. Dividends paid to each
class of shares in the Portfolio will, however, as declared and paid at the same
time and, except for the differences in expenses listed above, will be
determined in the same manner and paid in the same amounts per outstanding
shares.
IV. EXPENSE ALLOCATIONS
Income, realized and unrealized capital gains and losses, and Portfolio
expenses not allocated to a particular class shall be allocated to each class on
the basis of the net asset value of that class in relation to the net asset
value of the Portfolio.
Dated _______________ 1997
- --------
1. All three classes of Shares are subject to the same non-Rule 12b-1
Shareholder Servicing fee.
Exhibit 19 (b)
THE ALGER FUND
Alger MidCap Growth Portfolio
Rule 18f-3
Multiple Class Plan, as Amended
The ALGER MIDCAP GROWTH PORTFOLIO (the "Portfolio") of THE ALGER FUND (the
"Fund"), has elected to rely on Rule 18f-3 under the Investment Company Act of
1940, as amended (the "1940 Act"), in offering multiple classes of shares with
differing distribution arrangements, voting rights and exchange and conversion
features.
Pursuant to Rule 18f-3, the Board of Trustees of the Fund has approved and
adopted this amended written plan (the "Plan") specifying all of the differences
among the classes of shares to be offered by the Portfolio. Prior to such
offering, the Plan will be filed as an exhibit to the Fund's registration
statement. The Plan sets forth all the differences among the classes including
those, if any, pertaining to shareholder services, distribution arrangements,
expense allocations, and conversion or exchange features.
I. ATTRIBUTES OF SHARE CLASSES
This section discusses the attributes of the various classes of shares.
Each share of the Portfolio represents an equal pro rata interest in the
Portfolio and has identical voting rights, powers, qualifications, terms and
conditions and, in proportion to each share's net asset value, liquidation
rights and preferences. The classes differ in that: (a) each class has a
different class designation; (b) only the Class A Shares are subject to a
front-end sales charge ("FESC"); (c) only the Class B and Class C Shares are
subject to contingent deferred sales charges ("CDSCs"), except that certain
Class A Shares may also be subject to a CDSC; (d) only the Class B and Class C
Shares (as described below) are subject to distribution fees under plans adopted
pursuant to Rule 12b-1 under the 1940 Act (each a "Rule 12b-1 Plan"); (e) to the
extent that one class alone is affected by a matter submitted to a vote of the
shareholders, then only that class has voting power on the matter; (f) the
exchange privileges of each class differ from those of the other; and (g) as
described below, Class B and Class C Shares will automatically convert to Class
A Shares after designated holding period.(1)
A. CLASS A SHARES
Class A Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class A Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class A Shares are sold subject to the current maximum
FESC (with scheduled variations or elimination of the sales charge, as
permitted by the 1940 Act), except that certain Class A Shares for which
the FESC has been eliminated may instead be subject to a CDSC.
2. DISTRIBUTION AND SERVICE FEES. Class A Shares are not subject to a
Rule 12b-1 distribution fee. However, they are, like the Class B and Class
C Shares, subject to a shareholder servicing fee not to exceed .25% of the
average daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses are allocated particularly to Class A
Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class A Shares are
exchangeable for Class A Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class A Shares have no
conversion features.
B. CLASS B SHARES
Class B Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class B Shares under the exchange privileges
of the Fund. Shares of the Fund outstanding on the date that multiple classes of
shares were first made available have been redesignated Class B Shares.
1. SALES LOADS. Class B Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class B Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class B and, like the Class A and Class C
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class B Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class B Shares are
exchangeable for Class B Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class B shares
automatically convert to Class A Shares eight years after purchase as set
forth in the prospectus of the Fund.
C. CLASS C SHARES
Class C Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class C Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class C Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class C Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class C and, like the Class A and Class B
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class C Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class C Shares are
exchangeable for Class C Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class C shares
automatically convert to Class A Shares twelve years after purchase as set
forth in the prospectus of the Fund.
D. ADDITIONAL CLASSES
In the future, the Portfolio may offer additional classes of shares which
differ from the classes discussed above. However, any additional classes of
shares must be approved by the Board, and the Plan must be amended to describe
those classes.
II. APPROVAL OF MULTIPLE CLASS PLAN
The Board of the Fund, including a majority of the independent Trustees,
must approve the Plan initially. In addition, the Board must approve any
material changes to the classes and the Plan prior to their implementation. The
Board must find that the Plan is in the best interests of each class
individually and the Portfolio as a whole. In making its findings, the Board
should focus on, among other things, the relationships among the classes and
examine potential conflicts of interest among classes regarding the allocation
of fees, services, waivers and reimbursements of expenses, and voting rights.
Most significantly. the Board should evaluate the level of services provided to
each class and the cost of those services to ensure that the services are
appropriate and that the costs thereof are reasonable. In accordance with the
foregoing provisions of this Section II, the Board of the Fund has approved and
adopted this Plan, as amended, as of the date written below. III. Dividends and
Distributions
III. DIVIDENDS AND DISTRIBUTIONS
Because of the differences in fees paid under a Rule 12b-1 Plan, the
dividends payable to shareholders of Class A Shares will differ from the
dividends payable to shareholders of the other classes. Dividends paid to each
class of shares in the Portfolio will, however, as declared and paid at the same
time and, except for the differences in expenses listed above, will be
determined in the same manner and paid in the same amounts per outstanding
shares.
IV. EXPENSE ALLOCATIONS
Income, realized and unrealized capital gains and losses, and Portfolio
expenses not allocated to a particular class shall be allocated to each class on
the basis of the net asset value of that class in relation to the net asset
value of the Portfolio.
Dated _______________ 1997
- --------
1. All three classes of Shares are subject to the same non-Rule 12b-1
Shareholder Servicing fee.
Exhibit 19 (c)
THE ALGER FUND
Alger Capital Appreciation Portfolio
Rule 18f-3
Multiple Class Plan, as Amended
The ALGER CAPITAL APPRECIATION PORTFOLIO (the "Portfolio") of THE ALGER
FUND (the "Fund"), has elected to rely on Rule 18f-3 under the Investment
Company Act of 1940, as amended (the "1940 Act"), in offering multiple classes
of shares with differing distribution arrangements, voting rights and exchange
and conversion features.
Pursuant to Rule 18f-3, the Board of Trustees of the Fund has approved and
adopted this amended written plan (the "Plan") specifying all of the differences
among the classes of shares to be offered by the Portfolio. Prior to such
offering, the Plan will be filed as an exhibit to the Fund's registration
statement. The Plan sets forth all the differences among the classes including
those, if any, pertaining to shareholder services, distribution arrangements,
expense allocations, and conversion or exchange features.
I. ATTRIBUTES OF SHARE CLASSES
This section discusses the attributes of the various classes of shares.
Each share of the Portfolio represents an equal pro rata interest in the
Portfolio and has identical voting rights, powers, qualifications, terms and
conditions and, in proportion to each share's net asset value, liquidation
rights and preferences. The classes differ in that: (a) each class has a
different class designation; (b) only the Class A Shares are subject to a
front-end sales charge ("FESC"); (c) only the Class B and Class C Shares are
subject to contingent deferred sales charges ("CDSCs"), except that certain
Class A Shares may also be subject to a CDSC; (d) only the Class B and Class C
Shares (as described below) are subject to distribution fees under plans adopted
pursuant to Rule 12b-1 under the 1940 Act (each a "Rule 12b-1 Plan"); (e) to the
extent that one class alone is affected by a matter submitted to a vote of the
shareholders, then only that class has voting power on the matter; (f) the
exchange privileges of each class differ from those of the other; and (g) as
described below, Class B and Class C Shares will automatically convert to Class
A Shares after designated holding period.(1)
A. CLASS A SHARES
Class A Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class A Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class A Shares are sold subject to the current maximum
FESC (with scheduled variations or elimination of the sales charge, as
permitted by the 1940 Act), except that certain Class A Shares for which
the FESC has been eliminated may instead be subject to a CDSC.
2. DISTRIBUTION AND SERVICE FEES. Class A Shares are not subject to a
Rule 12b-1 distribution fee. However, they are, like the Class B and Class
C Shares, subject to a shareholder servicing fee not to exceed .25% of the
average daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses are allocated particularly to Class A
Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class A Shares are
exchangeable for Class A Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class A Shares have no
conversion features.
B. CLASS B SHARES
Class B Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class B Shares under the exchange privileges
of the Fund. Shares of the Fund outstanding on the date that multiple classes of
shares were first made available have been redesignated Class B Shares.
1. SALES LOADS. Class B Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class B Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class B and, like the Class A and Class C
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class B Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class B Shares are
exchangeable for Class B Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class B shares
automatically convert to Class A Shares eight years after purchase as set
forth in the prospectus of the Fund.
C. CLASS C SHARES
Class C Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class C Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class C Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class C Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class C and, like the Class A and Class B
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class C Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class C Shares are
exchangeable for Class C Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class C shares
automatically convert to Class A Shares twelve years after purchase as set
forth in the prospectus of the Fund.
D. ADDITIONAL CLASSES
In the future, the Portfolio may offer additional classes of shares which
differ from the classes discussed above. However, any additional classes of
shares must be approved by the Board, and the Plan must be amended to describe
those classes.
II. APPROVAL OF MULTIPLE CLASS PLAN
The Board of the Fund, including a majority of the independent Trustees,
must approve the Plan initially. In addition, the Board must approve any
material changes to the classes and the Plan prior to their implementation. The
Board must find that the Plan is in the best interests of each class
individually and the Portfolio as a whole. In making its findings, the Board
should focus on, among other things, the relationships among the classes and
examine potential conflicts of interest among classes regarding the allocation
of fees, services, waivers and reimbursements of expenses, and voting rights.
Most significantly. the Board should evaluate the level of services provided to
each class and the cost of those services to ensure that the services are
appropriate and that the costs thereof are reasonable. In accordance with the
foregoing provisions of this Section II, the Board of the Fund has approved and
adopted this Plan, as amended, as of the date written below. III. Dividends and
Distributions
III. DIVIDENDS AND DISTRIBUTIONS
Because of the differences in fees paid under a Rule 12b-1 Plan, the
dividends payable to shareholders of Class A Shares will differ from the
dividends payable to shareholders of the other classes. Dividends paid to each
class of shares in the Portfolio will, however, as declared and paid at the same
time and, except for the differences in expenses listed above, will be
determined in the same manner and paid in the same amounts per outstanding
shares.
IV. EXPENSE ALLOCATIONS
Income, realized and unrealized capital gains and losses, and Portfolio
expenses not allocated to a particular class shall be allocated to each class on
the basis of the net asset value of that class in relation to the net asset
value of the Portfolio.
Dated _______________ 1997
- --------
1. All three classes of Shares are subject to the same non-Rule 12b-1
Shareholder Servicing fee.
Exhibit 19 (d)
THE ALGER FUND
Alger Growth Portfolio
Rule 18f-3
Multiple Class Plan, as Amended
The ALGER GROWTH PORTFOLIO (the "Portfolio") of THE ALGER FUND (the
"Fund"), has elected to rely on Rule 18f-3 under the Investment Company Act of
1940, as amended (the "1940 Act"), in offering multiple classes of shares with
differing distribution arrangements, voting rights and exchange and conversion
features.
Pursuant to Rule 18f-3, the Board of Trustees of the Fund has approved and
adopted this amended written plan (the "Plan") specifying all of the differences
among the classes of shares to be offered by the Portfolio. Prior to such
offering, the Plan will be filed as an exhibit to the Fund's registration
statement. The Plan sets forth all the differences among the classes including
those, if any, pertaining to shareholder services, distribution arrangements,
expense allocations, and conversion or exchange features.
I. ATTRIBUTES OF SHARE CLASSES
This section discusses the attributes of the various classes of shares.
Each share of the Portfolio represents an equal pro rata interest in the
Portfolio and has identical voting rights, powers, qualifications, terms and
conditions and, in proportion to each share's net asset value, liquidation
rights and preferences. The classes differ in that: (a) each class has a
different class designation; (b) only the Class A Shares are subject to a
front-end sales charge ("FESC"); (c) only the Class B and Class C Shares are
subject to contingent deferred sales charges ("CDSCs"), except that certain
Class A Shares may also be subject to a CDSC; (d) only the Class B and Class C
Shares (as described below) are subject to distribution fees under plans adopted
pursuant to Rule 12b-1 under the 1940 Act (each a "Rule 12b-1 Plan"); (e) to the
extent that one class alone is affected by a matter submitted to a vote of the
shareholders, then only that class has voting power on the matter; (f) the
exchange privileges of each class differ from those of the other; and (g) as
described below, Class B and Class C Shares will automatically convert to Class
A Shares after designated holding period.(1)
A. CLASS A SHARES
Class A Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class A Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class A Shares are sold subject to the current maximum
FESC (with scheduled variations or elimination of the sales charge, as
permitted by the 1940 Act), except that certain Class A Shares for which
the FESC has been eliminated may instead be subject to a CDSC.
2. DISTRIBUTION AND SERVICE FEES. Class A Shares are not subject to a
Rule 12b-1 distribution fee. However, they are, like the Class B and Class
C Shares, subject to a shareholder servicing fee not to exceed .25% of the
average daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses are allocated particularly to Class A
Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class A Shares are
exchangeable for Class A Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class A Shares have no
conversion features.
B. CLASS B SHARES
Class B Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class B Shares under the exchange privileges
of the Fund. Shares of the Fund outstanding on the date that multiple classes of
shares were first made available have been redesignated Class B Shares.
1. SALES LOADS. Class B Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class B Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class B and, like the Class A and Class C
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class B Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class B Shares are
exchangeable for Class B Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class B shares
automatically convert to Class A Shares eight years after purchase as set
forth in the prospectus of the Fund.
C. CLASS C SHARES
Class C Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class C Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class C Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class C Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class C and, like the Class A and Class B
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class C Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class C Shares are
exchangeable for Class C Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class C shares
automatically convert to Class A Shares twelve years after purchase as set
forth in the prospectus of the Fund.
D. ADDITIONAL CLASSES
In the future, the Portfolio may offer additional classes of shares which
differ from the classes discussed above. However, any additional classes of
shares must be approved by the Board, and the Plan must be amended to describe
those classes.
II. APPROVAL OF MULTIPLE CLASS PLAN
The Board of the Fund, including a majority of the independent Trustees,
must approve the Plan initially. In addition, the Board must approve any
material changes to the classes and the Plan prior to their implementation. The
Board must find that the Plan is in the best interests of each class
individually and the Portfolio as a whole. In making its findings, the Board
should focus on, among other things, the relationships among the classes and
examine potential conflicts of interest among classes regarding the allocation
of fees, services, waivers and reimbursements of expenses, and voting rights.
Most significantly. the Board should evaluate the level of services provided to
each class and the cost of those services to ensure that the services are
appropriate and that the costs thereof are reasonable. In accordance with the
foregoing provisions of this Section II, the Board of the Fund has approved and
adopted this Plan, as amended, as of the date written below. III. Dividends and
Distributions
III. DIVIDENDS AND DISTRIBUTIONS
Because of the differences in fees paid under a Rule 12b-1 Plan, the
dividends payable to shareholders of Class A Shares will differ from the
dividends payable to shareholders of the other classes. Dividends paid to each
class of shares in the Portfolio will, however, as declared and paid at the same
time and, except for the differences in expenses listed above, will be
determined in the same manner and paid in the same amounts per outstanding
shares.
IV. EXPENSE ALLOCATIONS
Income, realized and unrealized capital gains and losses, and Portfolio
expenses not allocated to a particular class shall be allocated to each class on
the basis of the net asset value of that class in relation to the net asset
value of the Portfolio.
Dated _______________ 1997
- --------
1. All three classes of Shares are subject to the same non-Rule 12b-1
Shareholder Servicing fee.
Exhibit 19 (e)
THE ALGER FUND
Alger Small Capitalization Portfolio
Rule 18f-3
Multiple Class Plan, as Amended
The ALGER SMALL CAPITALIZATION PORTFOLIO (the "Portfolio") of THE ALGER
FUND (the "Fund"), has elected to rely on Rule 18f-3 under the Investment
Company Act of 1940, as amended (the "1940 Act"), in offering multiple classes
of shares with differing distribution arrangements, voting rights and exchange
and conversion features.
Pursuant to Rule 18f-3, the Board of Trustees of the Fund has approved and
adopted this amended written plan (the "Plan") specifying all of the differences
among the classes of shares to be offered by the Portfolio. Prior to such
offering, the Plan will be filed as an exhibit to the Fund's registration
statement. The Plan sets forth all the differences among the classes including
those, if any, pertaining to shareholder services, distribution arrangements,
expense allocations, and conversion or exchange features.
I. ATTRIBUTES OF SHARE CLASSES
This section discusses the attributes of the various classes of shares.
Each share of the Portfolio represents an equal pro rata interest in the
Portfolio and has identical voting rights, powers, qualifications, terms and
conditions and, in proportion to each share's net asset value, liquidation
rights and preferences. The classes differ in that: (a) each class has a
different class designation; (b) only the Class A Shares are subject to a
front-end sales charge ("FESC"); (c) only the Class B and Class C Shares are
subject to contingent deferred sales charges ("CDSCs"), except that certain
Class A Shares may also be subject to a CDSC; (d) only the Class B and Class C
Shares (as described below) are subject to distribution fees under plans adopted
pursuant to Rule 12b-1 under the 1940 Act (each a "Rule 12b-1 Plan"); (e) to the
extent that one class alone is affected by a matter submitted to a vote of the
shareholders, then only that class has voting power on the matter; (f) the
exchange privileges of each class differ from those of the other; and (g) as
described below, Class B and Class C Shares will automatically convert to Class
A Shares after designated holding period.(1)
A. CLASS A SHARES
Class A Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class A Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class A Shares are sold subject to the current maximum
FESC (with scheduled variations or elimination of the sales charge, as
permitted by the 1940 Act), except that certain Class A Shares for which
the FESC has been eliminated may instead be subject to a CDSC.
2. DISTRIBUTION AND SERVICE FEES. Class A Shares are not subject to a
Rule 12b-1 distribution fee. However, they are, like the Class B and Class
C Shares, subject to a shareholder servicing fee not to exceed .25% of the
average daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses are allocated particularly to Class A
Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class A Shares are
exchangeable for Class A Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class A Shares have no
conversion features.
B. CLASS B SHARES
Class B Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class B Shares under the exchange privileges
of the Fund. Shares of the Fund outstanding on the date that multiple classes of
shares were first made available have been redesignated Class B Shares.
1. SALES LOADS. Class B Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class B Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class B and, like the Class A and Class C
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class B Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class B Shares are
exchangeable for Class B Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class B shares
automatically convert to Class A Shares eight years after purchase as set
forth in the prospectus of the Fund.
C. CLASS C SHARES
Class C Shares are sold to (1) retail and institutional customers and (2)
persons entitled to exchange into Class C Shares under the exchange privileges
of the Fund.
1. SALES LOADS. Class C Shares are sold without the imposition of any
FESC, but are subject to a CDSC (with scheduled variations or eliminations
of the sales charge, as permitted by the 1940 Act).
2. DISTRIBUTION AND SERVICE FEES. Class C Shares are subject to a
distribution fee pursuant to a Rule 12b-1 Plan not to exceed .75% of the
average daily net asserts of Class C and, like the Class A and Class B
Shares, to a shareholder servicing fee not to exceed .25% of the average
daily net assets of the Portfolio.
3. CLASS EXPENSES. No expenses other than the distribution fee are
allocated particularly to Class C Shares.
4. EXCHANGE PRIVILEGES AND CONVERSION FEATURES. Class C Shares are
exchangeable for Class C Shares of the other portfolios of the Fund and for
shares of the Money Market Portfolio of the Fund. Class C shares
automatically convert to Class A Shares twelve years after purchase as set
forth in the prospectus of the Fund.
D. ADDITIONAL CLASSES
In the future, the Portfolio may offer additional classes of shares which
differ from the classes discussed above. However, any additional classes of
shares must be approved by the Board, and the Plan must be amended to describe
those classes.
II. APPROVAL OF MULTIPLE CLASS PLAN
The Board of the Fund, including a majority of the independent Trustees,
must approve the Plan initially. In addition, the Board must approve any
material changes to the classes and the Plan prior to their implementation. The
Board must find that the Plan is in the best interests of each class
individually and the Portfolio as a whole. In making its findings, the Board
should focus on, among other things, the relationships among the classes and
examine potential conflicts of interest among classes regarding the allocation
of fees, services, waivers and reimbursements of expenses, and voting rights.
Most significantly. the Board should evaluate the level of services provided to
each class and the cost of those services to ensure that the services are
appropriate and that the costs thereof are reasonable. In accordance with the
foregoing provisions of this Section II, the Board of the Fund has approved and
adopted this Plan, as amended, as of the date written below. III. Dividends and
Distributions
III. DIVIDENDS AND DISTRIBUTIONS
Because of the differences in fees paid under a Rule 12b-1 Plan, the
dividends payable to shareholders of Class A Shares will differ from the
dividends payable to shareholders of the other classes. Dividends paid to each
class of shares in the Portfolio will, however, as declared and paid at the same
time and, except for the differences in expenses listed above, will be
determined in the same manner and paid in the same amounts per outstanding
shares.
IV. EXPENSE ALLOCATIONS
Income, realized and unrealized capital gains and losses, and Portfolio
expenses not allocated to a particular class shall be allocated to each class on
the basis of the net asset value of that class in relation to the net asset
value of the Portfolio.
Dated _______________ 1997
- --------
1. All three classes of Shares are subject to the same non-Rule 12b-1
Shareholder Servicing fee.
