<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITES / /
ACT OF 1933
Pre-effective Amendment No. / /
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Post-Effective Amendment No. 44 /X/
--
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and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT / /
COMPANY ACT OF 1940
Amendment No. 27 /X/
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(Check appropriate box or boxes)
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AMWAY MUTUAL FUND TRUST
(Exact Name of Registrant as Specified in Charter)
2905 Lucerne Dr SE, Grand Rapids, Michigan 49546-7116
(Address of Principal Executive Office) (Zip Code)
Registrant's Telephone Number, including Area Code: (616) 787-6288
James J. Rosloniec, President and Treasurer
Amway Mutual Fund
7575 Fulton Street East
Ada, Michigan 49355-7150
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b)
/X/ on April 28, 1998 pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a) (1)
/ / on (date) pursuant to paragraph (a) (1)
/ / 75 days after filing pursuant to paragraph (a) (2)
/ / on (date) pursuant to paragraph (a) (2) of Rule 485
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
-C-1997, AMWAY CORPORATION, U.S.A.
<PAGE>
AMWAY MUTUAL FUND
CROSS REFERENCE SHEET
PART A
<TABLE>
<CAPTION>
Item Caption in Prospectus Page No.
- ---- --------------------- --------
<S> <C> <C>
1 Front Page 1
2 Fee Expense Table 2
3 Financial Highlights 3
4 The Fund 3
The Fund's Investment Policy 4
5 Management of the Fund 4
Organization of the Fund 8
6 Stockholder Inquiries 10
Dividend and Capital Gain Distributions to Shareholders 10
Tax Consequences 10
7 Purchase of Shares 5
Determination of Net Asset Value and Offering Price of
the Fund's Shares 8
8 How Shares are Redeemed 6
9 Not Applicable --
PART B
Item Caption in Statement of Additional Information Page No.
- ---- ---------------------------------------------- --------
10 Cover Page 1
11 Contents 16
12 Not Applicable --
13 Objectives, Policies and Restrictions on Fund's Investments 3
14 Officers and Directors of the Fund 5
15 Principal Shareholders 5
16 Investment Adviser 6
Transfer Agent 8
Custodian 9
Auditors 9
</TABLE>
<PAGE>
AMWAY MUTUAL FUND
CROSS REFERENCE SHEET
PART B (Continued)
<TABLE>
<CAPTION>
Item Caption in Statement of Additional Information Page No.
- ---- ---------------------------------------------- --------
<S> <C> <C>
17 Portfolio Transactions and Brokerages 4
18 Organization of the Fund 9
19 Purchase of Shares 9
Determination of Net Asset Value and Offering Price of
the Fund's Shares 10
How Shares are Redeemed 11
Money Market Fund Exchange Privilege 12
20 Federal Income Tax 13
21 Plan of Distribution 8
22 Investment Performance Information 14
23 Reports to Stockholders and Annual Audit 15
</TABLE>
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART A
Information Required in a Prospectus
<PAGE>
AMWAY MUTUAL FUND
7575 Fulton Street East
Ada, Michigan, 49355-7150
(616) 787-6288
(800) 346-2670
Contents Page
Fee Expense Table 2
Financial Highlights 3
The Fund 3
The Fund's Investment Policy 4
Management of the Fund 4
Purchase of Shares 6
How Shares are Redeemed 6
Exchange Privilege 8
Determination of Net Asset Value and
Offering Price of the Fund's Shares 8
Retirement Plans 9
Description of Common Stock 9
Dividend and Capital Gain Distributions
to Shareholders 9
Tax Consequences 9
Shareholder Inquiries 10
Investment Performance Information 10
AMWAY MUTUAL FUND LOGO
PROSPECTUS
The primary investment objective of the Fund is capital appreciation
through the ownership of common stock of companies in various industries which
offer growth potential. Income, while a factor in portfolio selection, is
secondary to the Fund's principal objective.
This Prospectus sets forth information regarding the Fund that a
prospective investor should know prior to investing. Investors are advised to
carefully read and retain this Prospectus for future reference. Additional
information about the Fund has been filed with the United States Securities and
Exchange Commission. Such information may be examined by any person at the
Securities and Exchange Commission in Washington, D.C. or may be obtained from
the Commission upon payment of the prescribed fee. The Commission maintains a
Web site (http://www.sec.gov) that contains the Statement of Additional
Information, material incorporated by reference, and other information regarding
registrants that file electronically with the Commission. Prospective investors
may request, without charge, the Statement of Additional Information, dated
APRIL 28, 1998, by writing or telephoning the Fund as indicated above. The
Statement of Additional Information is incorporated into this Prospectus by
reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is APRIL 28, 1998.
1
<PAGE>
AMWAY MUTUAL FUND
FEE EXPENSE TABLE
Shareholder Transaction Expenses
Maximum Sales Charge Imposed on Purchases None
(as a percentage of offering price)
Maximum Sales Charge Imposed on Reinvested None
Dividends (as a percentage of offering price)
Deferred Sales Charge (as a percentage of None
original purchase price or redemption proceeds,
as applicable)
Redemption Fees (as a percentage of amount None
redeemed, if applicable)
Exchange Fee None
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fees .55%
12b-1 Fees .25%
Other Expenses .35%
----
Total Fund Operating Expenses 1.15%
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-----
Example*
1 year 3 years 5 years 10 years
An investor would pay the following
expenses on a $1,000 investment,
assuming (1) 5% annual return and
(2) redemption at the end of each
time period: $12 $36 $63 $139
--- --- --- ----
*This example should not be considered a representation of past or future
expenses and actual expenses may be greater or lesser than those shown.
The purpose of the fee table is to provide an investor with an understanding
of the various costs and expenses incurred by all shareholder accounts that an
investor will bear directly or indirectly. Prior to April 1, 1998 the Fund
charged a sales charge of 3%. This charge was eliminated when the Fund adopted
a 12b-1 distribution plan which has been reflected in the fee expense table
above. Annual Fund operating expenses are based upon total expenses incurred by
the Fund for the year ended December 31, 1997, and have been adjusted to reflect
adoption of the 12b-1 distribution plan. Operating expenses include the Fund's
portfolio accounting service expenses in the amount of $2,500 per month ($30,000
annually) which was paid through the use of directed brokerage commissions. The
example, as required by the Securities and Exchange Commission, assumes a 5%
annual return in determining the total expenses paid on an investment.
Therefore, future expenses may be greater or less than those shown in the
example. Expenses include only those expenses incurred by all shareholder
accounts and not those expenses incurred for specific shareholder purposes such
as bank fees for wire transfers under $5,000 which is currently $15 (see "How
Shares Are Redeemed"), Individual Retirement Accounts, or Profit-Sharing
Trusts.
2
<PAGE>
AMWAY MUTUAL FUND
FINANCIAL HIGHLIGHTS
The table below shows financial information for Amway Mutual Fund expressed in
terms of one share outstanding throughout the period. The information in the
tables is covered by the report of the Fund's independent auditors. The report
is contained in the Fund's Registration Statement available from the Fund. The
financial statements are contained in the Fund's 1997 Annual Report to
Shareholders along with additional information about the performance of the Fund
which may be obtained by writing or calling the Fund.
<TABLE>
<CAPTION>
(Selected data for each share of capital stock outstanding throughout each period.)
Year ended December 31,
- -----------------------------------------------------------------------------------------------------------------------------
1997 1996 1995* 1994 1993 1992 1991 1990 1989 1988
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
beginning of period $7.62 $7.43 $6.88 $7.71 $7.57 $8.11 $6.82 $7.26 $6.49 $7.87
Income from investment
operations:
Net investment income .09 .10 .10 .03 .02 .02 .06 .08 .16 .16
Net gain (loss) on
securities 1.62 1.59 1.98 (.49) .78 .10 2.65 (.01) 1.93 .36
-------------------------------------------------------------------------------------------------
Total from investment
operations 1.71 1.69 2.08 (.46) .80 .12 2.71 .07 2.09 .52
-------------------------------------------------------------------------------------------------
Distributions:
Dividends (from net
investment income) .10 .09 .11 .03 .02 .02 .06 .08 .16 .15
Distributions (from
capital gains) 1.50 1.41 1.42 .34 .64 .64 1.36 .43 1.16 1.75
-------------------------------------------------------------------------------------------------
Total distributions 1.60 1.50 1.53 .37 .66 .66 1.42 .51 1.32 1.90
Net Asset Value, end of
period $7.73 $7.62 $7.43 $6.88 $7.71 $7.57 $8.11 $6.82 $7.26 $6.49
-------------------------------------------------------------------------------------------------
Total Return** 22.47 23.18% 30.55% (5.87%) 10.85% 1.77% 41.81% 1.01% 32.83% 6.89%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $139,164 $113,327 $77,248 $58,921 $61,741 $55,342 $53,238 $38,286 $39,029 $31,274
Ratio of expenses to
average net assets*** .9% 1.0% 1.1% 1.1% 1.1% 1.1% 1.1% 1.2% 1.2% 1.3%
Ratio of net income to
average net assets 1.1% 1.2% 1.2% .4% .2% .3% .7% 1.1% 2.0% 1.9%
Portfolio turnover rate 103.1% 100.4% 173.3% 78.1% 91.5% 136.5% 160.4% 171.1% 14.6% 135.5%
Average commission
rate per share $.0574 $.0600 $.0598 $.0597 $.0682 $.0691 $.0697 $.0708 $.0684 $.0672
</TABLE>
The Supplementary Information has been audited by BDO Seidman, LLP, the
Independent Certified Public Accountants for the Fund.
*Effective May 1, 1995, Ark Asset Management Co., Inc. entered into a
Sub-Advisory Agreement with the Fund. Kemper Financial Services previously
served as the Fund's Sub-Advisor.
**The Fund's base portfolio accounting services expense in the amount of $2,500
per month ($30,000 annual base fee) was paid through the use of directed
brokerage commissions. The ratio includes fees paid with brokerage commissions
for fiscal years ending after September 1, 1995. Effective April 22, 1998 the
Fund adopted a 12b-1 plan of distribution (see page 6) which expenses are not
reflected prior to that date.
THE FUND
Amway Mutual Fund (the "Fund") is a series of Amway Mutual Fund Trust (the
"Trust"), a Delaware business trust. The Fund is the successor to Amway Mutual
Fund, Inc. a Delaware corporation.
The Fund is a mutual fund, i.e. a means by which many persons can, by
purchasing shares of beneficial interests ("shares") of the Fund, pool
relatively small amounts for a more diversified managed investment in securities
than would be possible for a single investor. The Fund will redeem (buy back)
its shares upon the request of a shareholder, at the net asset value of the
shares at the time of redemption (see "How Shares Are Redeemed").
3
<PAGE>
AMWAY MUTUAL FUND
THE FUND'S INVESTMENT POLICY
The primary investment objective of the Fund is capital appreciation.
Income, while a factor in portfolio selection, is secondary to the Fund's
principal objective. In pursuing this objective, it is the Fund's policy to
invest a major portion of its assets in common stocks (or securities convertible
into or with rights to purchase common stock) of companies believed by the Fund
to offer good growth potential over both the intermediate and the long-term
period. However, when current market or economic conditions make it seem
advisable by the Fund to do so, for temporary defensive reasons, the Fund may
invest all or any portion of its assets in other types of securities, including
preferred stocks, high-grade debt securities, or obligations of the United
States or of any State, or may hold its assets in cash.
In view of the Fund's investment objective of capital appreciation, with
income as a secondary objective, the Fund intends to purchase securities for
long-term or short-term profits, as appropriate. Securities will be disposed of
in situations where, in management's opinion, such potential is no longer
feasible or the risk of decline in the market price is too great. Therefore, in
order to achieve the Fund's objectives, the purchase and sale of securities will
be made without regard to the length of time the security is to be held.
Portfolio turnover rates for the years ended December 31, 1997 and 1996 were
103.1% and 100.4%, respectively. A 100% annual turnover rate would occur if all
of a Fund's securities were replaced one time during a period of one year.
Short-term gains realized from portfolio turnover are taxable to shareholders as
ordinary income. In addition, higher portfolio turnover rates can result in
corresponding increases in brokerage commissions.
Although care is being exercised in the selection of securities for
investment by the Fund, the Fund's investments are affected by market
fluctuations and are subject to the risks common to all security investments.
Therefore, there can be no certainty that the Fund's growth or income objective
will be realized.
The Fund's investment objective and policy as described above is
fundamental and may not be changed without the approval of the lesser of (i) 67%
or more of the shares present at a meeting at which the holders of more than 50%
of the shares are present in person or represented by proxy, or (ii) more than
50% of the outstanding shares of the Fund.
MANAGEMENT OF THE FUND
The business and affairs of the Fund are managed and under the direction of
the Board of Trustees. The Fund has entered into an Advisory and Service
Contract ("Contract") with Amway Management Company (the "Investment
Advisor"), 7575 Fulton Street East, Ada, Michigan 49355. Under the Contract,
the Fund employs the Investment Advisor to furnish investment advice and manage
on a regular basis the investment portfolio of the Fund, subject to the
direction of the Board of Trustees, and to the provisions of the Fund's current
Prospectus; to furnish for the use of the Fund, office space and all necessary
office facilities, equipment and personnel for servicing the investments of the
Fund, and (with certain specific exceptions) administering its affairs; and to
pay the salaries and fees of all Officers and Trustees. Except when otherwise
specifically directed by the Fund, the Investment Advisor will make investment
decisions on behalf of the Fund and place all orders for the purchase and sale
of portfolio securities for the Fund's account. The Investment Advisor shall be
permitted to enter into an agreement with another advisory organization
(sub-advisor), whereby the sub-advisor will provide all or part of the
investment advice and services required to manage the Fund's investment
portfolio as provided for in this agreement. Amway Management Company has served
as Investment Advisor for the Fund and its predecessor since 1971. The Fund pays
the Adviser a fee at the annual rate of 0.55% on the first $100 million of
average daily net assets of the Fund, 0.50% on the next $50 million in assets,
and 0.45% on the next $50 million in assets. When the Fund's assets reach $200
million the rate would be 0.50% on assets up to $200 million and 0.45% on assets
in excess of $200 million, so long as the Fund continued to have at least $200
million in assets.
4
<PAGE>
AMWAY MUTUAL FUND
The Investment Advisor has entered into a Sub-Advisory Agreement with Ark
Asset Management Co., Inc. ("Sub-Advisor"), One New York Plaza, New York, NY
10004. Under the Sub-Advisory Agreement, the Advisor employs the Sub-Advisor to
furnish investment advice and manage on a regular basis the investment portfolio
of the Fund, subject to the direction of the Advisor, the Board of Trustees, and
to the provisions of the Fund's current Prospectus. Except when otherwise
specifically directed by the Fund or the Advisor, the Sub-Advisor will make
investment decisions on behalf of the Fund and place all orders for the purchase
or sale of portfolio securities for the Fund's account. The Sub-Advisor is
engaged in the management of investment funds for institutional clients in
excess of $23 billion. The Sub-Advisor and its affiliates provide investment
advice and manage investment portfolios for other corporate, pension, profit-
sharing and individual accounts. For services rendered, the Investment Advisor,
not the Fund, pays the Sub-Advisor a fee at the annual rate of 0.45% on the
first $100 million of average daily net assets of the Fund, 0.40% on the next
$50 million in assets, and 0.35% on the next $50 million in assets. When the
Fund's assets reach $200 million the rate would be 0.40% on assets up to $200
million and 0.35% on assets in excess of $200 million, so long as the Fund
continued to have at least $200 million in assets.
C. Charles Hetzel, Vice Chairman of Ark Asset Management, Inc., is the head
of the Growth at a Reasonable Price Group, which, since April 1995, has been
responsible for management of the Fund's portfolio. He has served as the head of
the Growth at a Reasonable Price Group since 1981. Mr. Hetzel has spent his
entire career at Ark Asset Management, Inc. or a predecessor firm. He received a
B.S. degree from the University of Utah and M.B.A. from the Columbia School of
Business Administration.
The Growth at a Reasonable Price Group determines overall investment
strategy for equity portfolios managed by the Sub-Advisor. The Growth at a
Reasonable Price Group, in addition to Mr. Hetzel, consists of Steven M.
Steiner, John E. Bailey, William G. Steuernagel, and James G. Pontone. The
portfolio managers work together as a team with the firm's research analysts.
Equity analysts, through research, analysis and evaluation, work to develop
investment ideas appropriate for these portfolios. These ideas are studied and
debated by the Growth at a Reasonable Price Group and decisions regarding the
portfolio are made by the Group. After investment decisions are made, equity
traders execute the portfolios transactions through various broker-dealer firms.
Amway Management Company, 7575 Fulton Street East, Ada, Michigan 49355,
performs the Transfer Agent function for the Fund and serves as the dividend
disbursing agent.
Jay Van Andel and Richard M. DeVos are controlling persons of the
Investment Advisor and Transfer Agent, since they own, together with their
spouses, substantially all of the outstanding securities of Amway Corporation,
which indirectly controls the outstanding securities of each entity. Amway
Corporation is a Michigan manufacturer and direct selling distributor of home
care and personal care products.
PURCHASE OF SHARES
Pursuant to a Principal Underwriter Agreement, the Investment Advisor
acts as exclusive agent for the sale of shares of the Fund. The minimum
initial investment required to establish an account is $500. An additional
investment in the minimum amount of $50 can be made in your account at any
time. Investments are made at the offering price (see "Determination of Net
Asset Value and Offering Price of the Fund's Shares"), next determined after
the Fund receives your purchase application and investment.
You may open a new account with the Fund by completing the enclosed
application, submitting your check made payable to Amway Management Company and
mailing the required information to Amway Management Company, 7575 Fulton Street
East, Ada, Michigan 49355-7150.
You may make additional investments to existing accounts by mail, wire, or
by the use of the pre-authorized check privilege. When making an additional
investment by check, please tear-off the stub from your statement of account, or
enclose a letter of instructions including your account number and your check
made payable to Amway Management Company. Wire transfers would normally be used
for large purchases. You may also arrange to make periodic investments through
automatic deductions from your checking account by completing the appropriate
form and providing the necessary documentation to establish this privilege.
Please contact the Fund for additional information for utilizing either of these
two options.
5
<PAGE>
AMWAY MUTUAL FUND
DISTRIBUTION PLAN
The Trust has adopted a Plan and Agreement of Distribution ("Distribution
Plan"). Under the Distribution Plan, which became effective on April 22, 1998,
the Adviser will provide services in connection with distributing the Fund's
shares, and will be compensated at a maximum annual rate of 0.25 of 1% of the
average daily net assets of the Fund.
Amounts received by the Adviser may be retained by the Adviser as
compensation for its services, or paid to other investment professionals who
provide services in connection with the distribution of Fund shares. The
Trustees will review the services provided and compensation paid pursuant to the
Distribution Plan no less often than quarterly.
The Adviser acts as the exclusive agent for sales of shares of the Fund
pursuant to a Principal Underwriting Agreement. Prior to April 1, 1998, the
Adviser received a sales commission of 3% of the offering price of the Fund's
shares. The sales commission was eliminated when the Fund adopted the
Distribution Plan.
HOW SHARES ARE REDEEMED
The Fund will redeem your shares AT THE NET ASSET VALUE NEXT DETERMINED
AFTER receiving a proper request. There is no redemption charge by the Fund.
However, if a shareholder uses the services of a broker-dealer for the
repurchase, there may be a charge by the broker-dealer to the shareholder for
such services. Shares can be redeemed by the mail, telephone or telegram, or
through the automatic withdrawal plan as described below.
When redeeming by mail, if no certificates have been issued, you need only
send a written request for redemption to Amway Management Company, the Transfer
Agent, 7575 Fulton Street East, Ada, Michigan 49355-7150. This request must
state the portion of your account to be redeemed, including your account number
and the signature of each account owner, signed exactly as your name appears on
the records of the Fund. If a certificate has been issued to you for the shares
being redeemed, the certificate (endorsed or accompanied by a signed stock
power) must accompany your redemption request, with your signature guaranteed
without qualification by a national bank; a state bank; a member firm of a
principal stock exchange or other entity described in accordance with Rule 17Ad-
15 under the Securities Exchange Act of 1934. Additional documents may be
required in the event of special circumstances (described below).
You can request the telephone or telegram exchange or redemption option by
so indicating on your application. You may redeem shares under this option by
calling the Fund at the number indicated on the front of this Prospectus on any
business day before 4:00 p.m., Eastern Time. By establishing the telephone or
telegram exchange or redemption option, you authorize the Transfer Agent to
honor any telephone or telegram exchange or redemption request from any person
representing themselves to be the investor. Procedures required by the Fund to
ensure that a shareholder's requested telephone or telegram transaction is
genuine include identification by the shareholder of the account by number,
recording of the requested transaction and sending a written confirmation to
shareholders reporting the requested transaction. The
Fund is not responsible for unauthorized telephone or telegram exchanges or
redemptions unless the Fund fails to follow these procedures. Shares must be
owned for 15 days before redeeming by the telephone and telegram exchange and
cannot be in certificate form unless the certificate is tendered with the
request for redemption. Certificated shares cannot be redeemed by the telephone
and telegram exchange. All redemption proceeds will be forwarded to the address
or bank designated on the account application.
The Transfer Agent and the Fund have reserved the right to change, modify,
or terminate the telephone or telegram exchange or redemption option at any
time. Before this option is effective for a corporation, partnership, or other
organizations, additional documents may be required. This option is not
available for Profit-Sharing Trust and Individual Retirement Accounts.
Additional documents may be required in the event of special circumstances
(described below). The Fund and the Transfer Agent disclaim responsibility for
verifying the authenticity of telephone and telegram exchange or redemption
requests which are made in accordance with the procedures approved by
shareholders.
If the value of your account is $10,000 or more, you may arrange to receive
automatic periodic cash payments. Please contact the Fund for more information.
6
<PAGE>
AMWAY MUTUAL FUND
Redemption proceeds are normally paid in cash (check form) and mailed to
the address of record within two or three business days after a proper request
is received. A request that redemption proceeds be wired or mailed to your bank
of record will be honored provided the bank account registration matches exactly
the Fund account registration. Wire transfers will normally be used for large
redemptions. Any bank charges charged the Fund for wire redemptions under $5,000
(currently $15) will be deducted from your redemption proceeds. This charge is
subject to change without notice. Your bank may charge you for receiving wires.
Your bank registration information should be provided on the account application
if this option will be used.
Before redeeming shares, in special circumstances, the Transfer Agent may
request additional documents such as, but not limited to, a stock power, a trust
instrument, a certificate of death, an appointment as personal representative,
court orders, a divorce decree or property settlement, a certification of
corporate authority, and a waiver of tax required in some states when settling
estates. These procedures are for the protection of shareholders and to ensure
proper payment. An inquiry as to the proper redemption requirements should be
directed to the Transfer Agent if these circumstances are present.
When redeeming shares from an Individual Retirement Account, you will be
subject to withholding of Federal income tax, unless you elect not to have
withholding apply. When redeeming shares from a Profit-Sharing Trust, you will
generally be subject to withholding of Federal income tax. Therefore, you will
be required to complete a Distribution Election Form prior to redemption from
these accounts.
The price at which shares will be redeemed by the Fund is the net asset
value per share as next computed after a proper request is received. However,
your right to redeem might be suspended or postponed for more than seven days if
the New York Stock Exchange is closed, other than weekends or holiday closings,
or trading on the Exchange is restricted or the Securities and Exchange
Commission deems an emergency exists. The Fund will not mail redemption proceeds
until checks (including certified or cashier's checks) received for the shares
purchased have cleared. The amount you receive may be more or less than your
cost, depending on the net asset value of the shares at the time of redemption
and will result in an event reportable for tax purposes.
MONEY MARKET FUND EXCHANGE PRIVILEGE
The Underwriter for Amway Mutual Fund ("Fund") has arranged for shares
of the three money market portfolios of Cash Equivalent Fund, an open-end
money market mutual fund ("Money Market Fund") to be available in exchange
for shares of the Fund for shareholders residing in the U.S. Also, clients of
the Underwriter can exchange shares in the Money Market Fund for shares of
the Fund. Shares of the Money Market Fund so acquired (including any
reinvested dividends thereon) may be re-exchanged for shares of the Fund
without sales charge. All other shares will be subject to the sales charge
(see "Determination of Net Asset Value and Offering Price of the Fund's
shares"). The Underwriter receives a maximum fee from Kemper Financial
Services, Inc., the distributor and administrator for the Money Market Fund,
of .38 of 1% per year of the average daily net asset value of shares of the
Money Market and Government Securities Portfolios, and of .33 of 1% per year
of the average daily net asset value of shares of Tax-Exempt Portfolio,
acquired through this exchange privilege. This exchange privilege does not
constitute an offering or recommendation by the Fund of the Money Market
Fund. The Money Market Fund is separately managed.
The above described Exchange Privilege may be exercised by sending written
instruction to the Transfer Agent. See "How Shares Are Redeemed" for
applicable signatures and signature guarantee requirements. Shareholders may
authorize telephone or telegram exchanges or redemptions by making an election
on your application. Procedures required by the Fund to ensure that a
shareholder's requested telephone or telegram transaction is genuine include
identification by the shareholder of the account by number, recording of the
requested transaction and sending a written confirmation to shareholders
reporting the requested transaction. The Fund is not responsible for
unauthorized telephone or telegram exchanges unless the Fund fails to follow
these procedures. Shares must be owned for 15 days before exchanging and cannot
be in certificate form unless the certificate is tendered with the request for
exchange. An exchange requires the purchase of shares of the particular
portfolio of the Money Market Fund with a value of at least $1,000 to establish
a new account or $100 to add to an existing account. Exchanges will be accepted
only if the registration of the two accounts is identical. Exchange redemptions
and purchases are effected on the
7
<PAGE>
AMWAY MUTUAL FUND.
basis of the net asset value next determined after receipt of the request in
proper order by the Fund. In the case of exchanges into the Money Market
Fund, dividends generally commence on the following business day. For federal
and state income tax purposes, an exchange is treated as a sale and may
result in a capital gain or loss, although if the shares exchanged have been
held less than 91 days, the sales charge paid on such shares is not included
in the tax basis of the exchanged shares, but is carried over and included in
the tax basis of the shares acquired.
A prospectus for the Money Market Fund which contains information
concerning charges and expenses may be obtained from the Underwriter. A
shareholder should read the prospectus carefully and consider differences in
objectives and policies before making any exchange. The Fund or the Underwriter
can change or discontinue this privilege, although shareholders generally would
be given 60 days advance notice of any termination or material amendment of the
Fund Exchange Privilege and shareholders who had exchanged into the Money Market
Fund generally would be permitted to reacquire shares of the Fund without sales
charge for at least 60 days after notice of termination of the Exchange
Privilege with the Money Market Fund.
DETERMINATION OF NET ASSET VALUE AND OFFERING PRICE
OF THE FUND'S SHARES
The net asset value of the Fund's shares is determined by dividing the
total current value of the assets of the Fund, less its liabilities, by the
number of shares outstanding at that time. This determination is made as of the
close of business on the New York Stock Exchange, 4:00 P.M. Eastern time, on
each business day on which that Exchange is open or on any other day in which
there is a sufficient degree of trading in the Fund's portfolio, except no
computation will be made on a day in which no order to purchase or redeem shares
was received.
In determining the current value of the Fund's assets, securities listed or
admitted to trading on a national securities exchange are valued at their last
reported sale price on the market where principally traded, before the time of
valuation. If a security is traded only in the over-the-counter market or if no
sales have been reported for a listed security on that day, it will be valued at
the mean between the current closing bid and asked prices. Securities for which
market quotations are not readily available, including any restricted
securities, and other assets of the Fund are valued at fair market value as
determined in good faith by the Fund's Board of TRUSTEES.
The offering price is the net asset value per share at the next
determined value after the order is placed, as determined above.
RETIREMENT PLANS
The Fund sponsors a prototype Profit-Sharing Trust and Individual
Retirement Accounts. Persons interested in additional information regarding
these plans should contact the Fund.
ORGANIZATION OF THE FUND
The Fund is a series of Amway Mutual Fund Trust, an open-end management
investment company which was organized as a Delaware business trust on February
2, 1998. The Fund is the successor of Amway Mutual Fund, Inc., which was
organized as a Delaware corporation on February 13, 1970.
The Fund is presently the only series of the Trust. The Declaration of
Trust authorizes the Trustees to create additional shares and to issue an
unlimited number of units of beneficial interest, or "shares." The Trustees are
also authorized to issue different classes of shares of any series. No series
which may be issued by the Trust is entitled to share in the assets of any other
series or is liable for the expenses or liabilities of any other series.
When issued, shares of beneficial interest in the Fund will be fully paid
and non-assessable. Shares are freely transferable and have no preemptive,
subscription or conversion rights. Each share has a par value of $1.00.
8
<PAGE>
AMWAY MUTUAL FUND
The Trust is not required to hold annual meetings of shareholders and does
not intend to hold such meetings. Shareholders of the Trust will have voting
rights only with respect to the limited number of matters specified in the
Declaration of Trust, and such other matters as may be determined or as may be
required by law. A meeting will be called for the purpose of voting on the
removal of a Trustee at the written request of holders of 10% of the Trust's
outstanding shares. In the event a meeting of shareholders is held, each share
will be entitled to one vote on all matters presented to shareholders, including
the election of Trustees.
DIVIDEND AND CAPITAL GAIN DISTRIBUTIONS TO SHAREHOLDERS
It is the policy of the Fund to distribute to shareholders each year as
dividends and distributions substantially all net investment income of the Fund
for the year and substantially all net capital gains received by the Fund, if
any. Such distributions, in the past, have been paid in December. Net investment
income and capital gain distributions, if any, will be paid on a basis which is
consistent with past policy. All net investment income and capital gain
distributions may be received in cash or reinvested in additional shares of the
Fund at their net asset value at the time of distribution, at no sales charge.
This election can be changed at any time by requesting a change in writing,
signed by all account owners.
TAX CONSEQUENCES
The Fund intends to continue to comply with the provisions of Subchapter M
of the Internal Revenue Code. Therefore, the Fund intends to distribute
substantially all net investment income and realized capital gains, if any.
Dividends derived from net investment income and net short-term capital gains
are taxable to shareholders as ordinary income and long-term capital gain
dividends are taxable to shareholders as long-term capital gain regardless of
how long the shares have been held and whether received in cash or reinvested in
additional shares of the Fund. Long-term capital gain dividends received by
individual shareholders are taxed at a maximum rate of 28%. Shareholders not
subject to tax on their income will not be required to pay tax on amounts
distributed to them. Each shareholder will receive a statement annually
informing them of the amount of the income and capital gains which have been
distributed by the Fund during the calendar year.
In addition, shareholders may realize a capital gain or loss when shares
are redeemed. For most types of accounts, the Fund will report the proceeds of
redemptions to shareholders and the IRS annually. However, because the tax
treatment also depends on the purchase price and a shareholder's personal tax
position, you should also keep your regular account statements to use in
determining your tax.
On the record date for a distribution, the Fund's share value is reduced by
the amount of the distribution. If a shareholder buys shares just before the
record date ("buying a dividend"), they will pay the full price for the
shares, and then receive a portion of the price back as a taxable distribution.
The Fund is required by law to withhold 31% of taxable dividends and
redemption proceeds paid to certain shareholders who do not furnish correct
tax payer identification numbers (in the case of individuals, a social
security number) and in certain other circumstances. Trustees of qualified
retirement plans are required by law to withhold 20% of the taxable portion
of any distribution that is eligible to be "rolled over." The 20%
withholding requirement does not apply to distributions from IRA's or any
part of a distribution that is transferred directly to another qualified
retirement plan, 403(b)(7) account or IRA. Shareholders should consult their
tax advisor regarding the 20% withholding requirement.
SHAREHOLDER INQUIRIES
Shareholder inquiries should be directed to the Fund by writing or
telephoning the Fund at the address or telephone number indicated on the cover
page of the Prospectus. Information relating to a specific account will be
disclosed, pursuant to a telephone inquiry, only if the shareholder identifies
the account by account number or by the social security number listed on the
account.
9
<PAGE>
AMWAY MUTUAL FUND
INVESTMENT PERFORMANCE INFORMATION
Following is a table illustrating the Fund's performance for annual periods
ended December 31, 1997, and its average annual total return percentages for
one, five, and ten years.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Accumulative Accumulative
Value of Shares Value of Shares
Calendar Years Cost of Value of Accepted As Accepted As
Ended Initial Initial Capital Gain Ordinary Income Total
December 31 Investment Investment Distributions Dividends Value
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1988 $1,000 825 226 18 1,069
1989 922 451 46 1,419
1990 867 509 58 1,434
1991 1,031 921 82 2,034
1992 962 1,026 82 2,070
1993 980 1,225 89 2,294
1994 874 1,196 89 2,159
1995 944 1,746 129 2,819
1996 968 2,336 168 3,472
1997 982 3,057 214 4,253
- -------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Average Annual Total Return For
The Periods Ended December 31, 1997
Amway Ark (Sub-advisor) Composite
- --------------------------------------------------------------------------------
<S> <C> <C>
One Year 22.47% 22.67%
Five Years 15.51% 19.56%
Ten Years 15.58% 17.48%
- --------------------------------------------------------------------------------
</TABLE>
Total return performance for the Fund is calculated by making an initial
investment of $1,000 at the beginning of the period, in the Fund's shares at net
asset value (without sales charges) and reinvesting all ordinary income
dividends and capital gain distributions paid during the period in additional
shares at net asset value per share on the reinvestment dates. Prior to 1991 and
1998 the Fund had a maximum sales charge of 6% and 3%, respectively, based upon
amount of shares purchased. The illustration includes recurring expenses
incurred by all shareholder accounts and not those incurred for specific
shareholder purposes such as bank fees for wire transfers, Individual Retirement
Accounts, or Profit-Sharing Trusts.
Total return performance also includes the composite performance of the
Fund's current sub-adviser, ARK Asset Management Company, who has been the
Fund's sub-adviser since May 1, 1995. The composite performance sets forth the
returns of the institutional private accounts managed by the sub-adviser which
have substantially similar investment objectives and policies as the Fund. The
data is provided to illustrate the past performance of the sub-adviser in
managing substantially similar accounts and does not represent the performance
of the Fund.
Shareholders should not consider the composite performance data as an
indication of future performance of the sub-adviser. The investment results of
the sub-adviser composite presented is unaudited and calculated in accordance
with the recommended standards of the Association for Investment Management and
Research retroactively applied to all time periods. All composite returns
presented were calculated on a total return basis and included all dividends and
interest, accrued income and realized and unrealized gains and losses, and
deductions for brokerage commissions and execution costs. Composite returns are
adjusted to assume that the Fund's operating charges, expenses, and fees (the
Fund's historical expense ratio) were deducted during such periods. No
adjustment has been made for the impact on the expense ratio due to growth in
the Fund's assets, RECENT REDUCTION OF management fees, or the adoption of a
12b-1 Distribution Plan.
10
<PAGE>
AMWAY MUTUAL FUND
The average annual total return for the Fund and Ark Composite for a
specific period is found by dividing the ending total value by the cost of the
initial investment for the period and taking this quotient to the Nth root, then
subtracting 1 (N represents the number of years in the period). The average
annual total return reflects the hypothetical annually compounded return that
would have produced the same cumulative total return if the Fund's performance
had been constant over the entire period. Such calculation is with all ordinary
income dividends and capital gain distributions reinvested at net asset value.
No adjustment has been made for any income taxes payable by shareholders on
ordinary income dividends and capital gain distributions accepted in shares
which are payable by shareholders in the tax year received.
Average annual total return percentages of the Fund will vary and the
publication of performance results is not a representation as to future
investment performance. Factors affecting the Fund's performance include general
market conditions, operating expenses and investment management. Net asset
values of the Fund will fluctuate. Additional information about the performance
of the Fund is contained in the Annual Shareholders Report which can be obtained
without charge.
11
<PAGE>
BULK RATE
U.S. POSTAGE
PAID
ADA, MI
PERMIT 100
AMWAY MUTUAL FUND
7575 Fulton Street East
Ada, Michigan 49355-7150
- --------------------------------------------------------------------------------
Amway
Mutual
Fund
Prospectus
APRIL 28, 1998
AMWAY MUTUAL FUND LOGO
- --------------------------------------------------------------------------------
12
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART B
Information Required in a Statement of Additional Information
<PAGE>
AMWAY MUTUAL FUND LOGO
STATEMENT OF ADDITIONAL INFORMATION
AMWAY MUTUAL FUND
7575 Fulton Street East
Ada, Michigan 49355-7150
(616) 787-6288
(800) 346-2670
This Statement of Additional Information is not a prospectus and,
therefore, should be read only in conjunction with the Prospectus, which can
be requested from the Fund by writing or telephoning as indicated above. This
Statement Of Additional Information relates to the Prospectus for the Fund
dated April 28, 1998.
The date of this Statement of Additional Information is April 28, 1998.
1
<PAGE>
(THIS PAGE INTENTIONALLY LEFT BLANK)
2
<PAGE>
AMWAY MUTUAL FUND
OBJECTIVES, POLICIES AND RESTRICTIONS ON THE FUND'S INVESTMENTS
The primary investment objective of the Fund is capital appreciation,
through the ownership of common stock of companies in various industries
which offer growth potential. Income, while a factor in portfolio selection,
is secondary to the Fund's principal objective. In addition to the discussion
found in the Prospectus, following is additional information concerning the
Fund's investments.
The Fund has the right to invest up to 10% of its total assets in
securities which are not readily marketable, including "restricted
securities" (securities which have not been registered with the Securities
and Exchange Commission or which are subject to contractual restrictions on
resale).
The Fund is subject to certain investment restrictions. In brief,
these provide that the Fund may not:
1. Underwrite securities of other issuers, except that it may acquire
portfolio securities under circumstances where, if sold publicly, it might
be deemed to be an underwriter for purposes of the Securities Act of 1933,
but no more than 10% of the value of the Fund's total assets will at any
time be invested in such securities.
2. Invest more than 5% of its total assets in the securities of any one issuer
other than the United States Government or purchase more than 10% of any
class of securities, including voting securities, of any one issuer.
3. Purchase interests in real estate as an investment, other than readily
marketable securities of companies which may have interests in real estate.
4. Engage in the purchase and sale of commodities or commodity contracts.
5. Invest in companies for the purpose of exercising control or management.
6. Make loans to others, although it may purchase a portion of an issue of
publicly distributed bonds, debentures, or other debt securities.
7. Engage in margin transactions or short sales.
8. Write, purchase, or sell puts, calls, or combinations thereof.
9. Participate in joint trading account.
10. Mortgage, pledge, hypothecate, or in any manner transfer as security for
indebtedness any securities owned or held by the Fund, except as permitted
in the following Item 11.
11. Borrow money, except that as a temporary measure and not for investment
purposes, it may borrow from banks up to 5% of the value of its total
assets taken at cost, which may be secured by up to 10% of such assets
taken at cost. (It should be noted that some states have laws which are
even more restrictive than the Fund's fundamental policy with respect to
this matter. As a result of these laws, it is the Fund's present operating
policy not to mortgage, pledge, or hypothecate its portfolio securities to
the extent that at any time the percentage of pledged securities plus the
sales load will exceed 10% of the offering price of the Fund's shares.)
12. Invest in securities of other investment companies, except in connection
with a merger with another investment company.
13. Invest more than 5% of its total assets in securities of companies having a
record of less than three years' continuous operation.
14. Retain, in the Fund's portfolio, securities of an issuer any of whose
officers, directors, or security holders is an officer or director of the
Fund or of the fund's investment advisor, if after the purchase of such
securities one or more of such officers or directors of the Fund or of the
Fund's investment advisor owns beneficially more than 1/2% of the
outstanding securities of such issuer and such officers and directors
owning beneficially more than 1/2% of such outstanding securities together
own beneficially more than 5% of such outstanding securities.
3
<PAGE>
AMWAY MUTUAL FUND
15. Invest more than 5% of its total assets in securities of a foreign issuer,
the purchase of whose securities is subject to the Federal Interest
Equalization Tax, which tax is not in effect at the date of this Statement
of Additional Information.
16. Invest in interests in oil, gas, or other mineral explorations or
development programs, other than readily marketable securities of
corporations which may have interests in such exploration or development
programs.
The Fund's investment objective, policy and restrictions as described
above are fundamental and may not be changed without shareholder approval, as
indicated in the Fund's Prospectus. The Fund is permitted to invest in
foreign issuers to the extent that the investments meet the Fund's primary
investment objective. The Fund does not currently own any warrants and does
not intend to own any warrants in excess of 5% of the Fund's net asset value.
PORTFOLIO TRANSACTIONS AND BROKERAGE
In purchasing and selling portfolio securities for the Fund, it is the
policy of the Fund to obtain the highest possible price on sales and the
lowest possible price on purchases of securities, consistent with the best
execution of portfolio transactions. Amway Management Company, the
("Investment Advisor"), or Ark Asset Management Co., Inc. ("Sub-Advisor")
will select the brokers and resulting allocation of brokerage commission;
but, the Investment Advisor's practice is subject to review by the Board of
Directors of the Fund, which has the primary responsibility in this regard,
and must be consistent with the policies stated above.
The Investment Advisor and Sub-Advisor, in effecting purchases and sales
of portfolio securities for the account of the Fund, will implement the
Fund's policy of seeking best execution of orders, which includes best net
prices. Consistent with this policy, orders for portfolio transactions are
placed with broker-dealer firms giving consideration to the quality,
quantity, and nature of each firm's professional services which include
execution, clearance procedures, wire service quotations, research
information, statistical, and other services provided to the Fund, Advisor,
and the Sub-Advisor. Any research benefits derived by the Sub-Advisor are
available to all clients of the Sub-Advisor. Since research information,
statistical, and other services are only supplementary to the research
efforts of the Sub-Advisor and still must be analyzed and reviewed by its
staff, the receipt of research information is not expected to materially
reduce expenses. Also, subject to the policy of seeking best price and
execution of orders, certain Fund expenses may be paid through the use of
directed brokerage commissions. While the Sub-Advisor will be primarily
responsible for the placement of the Fund's business, the policies and
practices in this regard must be consistent with the foregoing and will at
all times be subject to review by the Directors of the Fund.
The Sub-Advisor furnishes investment advice to other clients. The other
accounts may also make investments in the same investment securities and at
the same time as the Fund. When two or more of such clients are
simultaneously engaged in the purchase or sale of the same security, the
transactions are allocated as to amount and price in a manner considered
equitable to each and so that each receives to the extent practicable the
average price of such transactions, which may or may not be beneficial to the
Fund. The Board of Directors of the Fund believes that the benefits of the
Sub-Advisor's organization outweigh any limitations that may arise from
simultaneous transactions.
The Fund may acquire securities of brokers who execute the Fund's
portfolio transactions. As of December 31, 1997, the Fund owned no such
securities.
During the years ended December 31, 1997, 1996, and 1995, the Fund paid
total brokerage commissions on purchase and sale of portfolio securities of
$301,990, $250,136, and $333,077, respectively. Transactions in the amount of
$235,081,998, involving commissions of $268,072, were directed to brokers
because of research services provided during 1997.
4
<PAGE>
AMWAY MUTUAL FUND
PRINCIPAL SHAREHOLDERS
Amway Corporation indirectly, as of December 31, 1997, owned 981,389
shares, or 5.5% of the outstanding shares of the Fund. Jay Van Andel owns all
the outstanding securities of JVA Properties Corporation, the General Partner
for JVA Enterprises Limited Partnership, which owns, as of December 31, 1997,
2,615,030 shares, or 14.5% of the outstanding shares of the Fund. No other
person is known by the Fund to own of record or beneficially 5% or more of
the Fund's shares.
OFFICERS AND DIRECTORS OF THE FUND
The following are the Officers and Directors of the Fund or the Advisor or both,
together with their principal occupations during the past five years:
<TABLE>
<CAPTION>
Director's
Name and Address Age Office Held Principal Occupation Compensation
<S> <C> <C> <C> <C>
Richard A. DeWitt 84 Director of the Fund President, DeWitt Land and Cattle $5,000
720 Goldenrod Company (investments in land
Holland, Michigan and cattle); Chairman of the
49423 Board, Maes Board; Maes Incorporated
manufacturers (manufacturers of
agricultural equipment).
Allan D. Engel* 46 Director, Vice President, Sr. Manager, Investments and Real $5,000
7575 Fulton Street East Secretary and Assistant Estate, Amway Corporation
Ada, Michigan Treasurer of the Fund;
49355-7150 Director, President,
and Secretary of the Investment
Advisor; and Director, Vice
President, Secretary and
Assistant Treasurer of the
Transfer Agent.
Donald H. Johnson 67 Director of the Fund Retired Vice President-Treasurer, SPX $5,000
609 Second Street Corporation (Designs, manufactures and
No. Muskegon, Michigan markets products and services for the
49445 motor vehicle industry, 1986 to
present; Vice President and Director
Owatonna Tool, 1984 to 1986 (Owatonna
Tool acquired by SPX in 1985);
Secretary-Treasurer, Director Owatonna
Tool, Director Owatonna Tool, 1969 to
1984.
</TABLE>
5
<PAGE>
AMWAY MUTUAL FUND, INC.
<TABLE>
<CAPTION>
Director's
Name and Address Age Office Held Principal Occupation Compensation
<S> <C> <C> <C> <C>
Walter T. Jones 55 Director of the Fund Retired, Senior Vice President-Chief $5,000
936 Sycamore Ave. Financial Officer, Prince Corporation
Holland, Michigan (Automotive interior trim and interior
49424 systems; automotive designer,
manufacturer and supplier; and
designer and manufacturer of die
casting machines.)
James J. Rosloniec* 53 Director, President and Vice President-Audit and Control, Amway $5,000
7575 Fulton Street East Treasurer of the Fund; and Corporation, 1991 to present; Vice
Ada, Michigan Director, Vice-President and President-Finance and Treasurer, Amway
49355-7150 Treasurer of the Investment Corporation, 1979 to 1991.
Advisor; and Director,
President and Treasurer of the
Transfer Agent.
Richard E. Wayman 63 Director of the Fund Former Finance Director, Amway $5,000
7575 Fulton Street East Corporation, 1976 to 1996
Ada, Michigan
49355-7150
</TABLE>
*These Directors are interested persons under the Investment Company Act of
1940, as amended.
All Officers and certain Directors of the Fund and the Investment
Advisor are affiliated with Amway Corporation. The Officers serve without
compensation from the Fund. Fees paid to all Directors during the year ended
December 31, 1997, amounted to $25,000. Under the Advisory Contracts, the
Investment Advisor pays the fees of the Directors of the Fund. The Directors
and Officers of the Fund owned, as a group, less than 1% of the outstanding
shares of the Fund. The advisor also serves as the Fund's principal
underwriter (see "Distribution of Shares").
INVESTMENT ADVISOR AND OTHER SERVICES
The Fund has entered into an Advisory and Service Contract ("Contract")
with Amway Management Company (the "Investment Advisor"). Under the Contract,
the Fund employs the Investment Advisor to furnish investment advice and
manage on a regular basis the investment portfolio of the Fund, subject to
the direction of the Board of Directors of the Fund, and to provisions of the
Fund's current Prospectus; to furnish for the use of the Fund, office space
and all necessary office facilities, equipment, and personnel for servicing
the investments of the Fund; and (with certain specific exceptions)
administering its affairs and to pay the salaries and fees of all Officers
and Directors of the Fund. Amway Corporation provides the Investment Advisor
with such employee services on a contractual basis. The Investment Advisor
has served the Fund in that capacity since 1971. The Investment Advisor will,
from time to time, discuss with the Fund economic investment developments
which may affect the Fund's portfolio and furnish such information as the
Investment Advisor may believe appropriate for this purpose. The Investment
Advisor will maintain such statistical and analytical information with
respect to the Fund's portfolio securities as the Investment Advisor may
believe appropriate and shall make such materials available for inspection by
the Fund as may be reasonable. Except when otherwise specifically directed by
the Fund, the Investment Advisor will make investment decisions on behalf of
the Fund and place all orders for the purchase and sale of portfolio
securities for the Fund's account.
6
<PAGE>
AMWAY MUTUAL FUND
The Investment Advisor shall be permitted to enter into an agreement
with another advisory organization (sub-advisor) whereby the sub-advisor will
provide the investment advice and services required to manage the Fund's
investment portfolio as provided for in the Contract.
Under the Contract, the Fund will pay all its expenses other than those
expressly stated to be payable by the Investment Advisor, which expenses
payable by the Fund include, without implied limitation, (i) registration of
the Fund under the Investment Company Act of 1940; (ii) commissions, fees,
and other expenses connected with the purchase or sale of securities; (iii)
auditing, accounting, and legal expenses; (iv) taxes and interest; (v)
government fees; (vi) expenses of issue, sale, repurchase, and redemption of
shares; (vii) expenses of registering and qualifying the Fund and its shares
under federal and state securities laws and of preparing and printing
prospectuses for such purposes and for distributing the same to shareholders
and investors; (viii) expenses of reports and notices to shareholders and of
meetings of shareholders and proxy solicitations therefore; (ix) fees and
expenses related to the determination of the Fund's net asset value; (x)
insurance expenses; (xi) association membership dues; (xii) fees, expenses,
and disbursements of custodians and sub-custodians for all services to the
Fund (including without limitation safekeeping of funds and securities, and
keeping of books and accounts); (xiii) fees, expenses, and disbursement of
transfer agents, dividend disbursing agents, shareholder servicing agents,
and registrars for all services to the Fund; and (xiv) such non-recurring
items as may arise, including expenses incurred in connection with
litigation, proceedings and claims, and the obligation of the Fund to
indemnify its Directors and Officers with respect thereto.
In return for its management and investment advisory services, the Fund
pays the Advisor, pursuant to the Contract, a fee amounting on an annual
basis to approximately 0.55% on the first $100 million of average daily net
assets of the Fund, 0.50% on the next $50 million in assets, and 0.45% on the
next $50 million in assets. When the Fund's assets reach $200 million the
rate would be 0.50% on assets up to $200 million and 0.45% on assets in
excess of $200 million, so long as the Fund continued to have at least $200
million in assets. The fee is computed daily and paid quarterly. The advisory
fees paid by the Fund to the Investment Advisor during the years ended
December 31, 1997, 1996, and 1995, were $727,102, $524,637, and $378,693,
respectively.
Jay Van Andel and Richard M. DeVos are controlling persons of the
Investment Advisor and Transfer Agent (see "Transfer Agent"), since they own,
together with their spouses, substantially all of the outstanding securities
of Amway Corporation, which in turn indirectly owns all of the outstanding
securities of each entity.
A Sub-Advisory Agreement has been entered into between the Investment
Advisor and Ark Asset Management Co., Inc., One New York Plaza, 29th Floor,
New York, NY 10004 (Sub-Advisor). Under the Sub-Advisory Agreement, the
Advisor employs the Sub-Advisor to furnish investment advice and manage on a
regular basis the investment portfolio of the Fund, subject to the direction
of the Advisor, the Board of Directors of the Fund, and to the provisions of
the Fund's current Prospectus. Except when otherwise specifically directed by
the Fund or the Advisor, the Sub-Advisor will make investment decisions on
behalf of the Fund and place all orders for the purchase or sale of portfolio
securities for the Fund's account. For services rendered, the Investment
Advisor, not the Fund, pays the Sub-Advisor a fee amounting on an annual
basis to approximately 0.45% on the first $100 million of average daily net
assets of the Fund, 0.40% on the next $50 million in assets, and 0.35% on the
next $50 million in assets. When the Fund's assets reach $200 million the
rate would be 0.40% on assets up to $200 million and 0.35% on assets in
excess of $200 million, so long as the Fund continued to have at least $200
million in assets.
The Contract and Sub-Advisory Agreement continue in effect indefinitely
from year to year so long as their continuance after the initial two-year
period is specifically approved at least annually by vote of the Board of
Directors, or by vote of a majority of the outstanding shares of the Fund. In
addition, and in either event, the Contract and Sub-Advisory Agreement and
their terms must be approved at least annually by a vote of a majority of the
Directors of the Fund who are not parties to the Contract or Sub-Advisory
Agreement, or interested persons of any such party, cast in person at a
meeting called for the purpose of voting on such approval. The Contract and
Sub-Advisory Agreement were approved by vote of a majority of the outstanding
shares at the Annual Meeting of Shareholders on April 22, 1998. The Contract
and Sub-Advisory Agreement provide that they will terminate automatically in
the event of their assignment. In addition, the Contract and Sub-Advisory
Agreement are terminable at any time without penalty by the Board of
Directors or by vote of a majority of the Fund's outstanding shares on 60
days' written notice to the Investment Advisor or Sub-Advisor, and by the
Investment Advisor or Sub-Advisor on 60 days' written notice to the Fund.
7
<PAGE>
AMWAY MUTUAL FUND
The Fund has entered into an agreement with DST Systems, Inc. ("DSTS")
whereby DSTS provides a portfolio accounting and information system for
portfolio management for the maintenance of records and processing of
information which is needed daily in the determination of the net asset value
of the Fund. Currently, this expense amounts to approximately $2,500 per
month.
PLAN OF DISTRIBUTION
The Trust has adopted a Plan and Agreement of Distribution
("Distribution Plan"). Under the Distribution Plan, which became effective on
April 22, 1998, the Adviser will provide services in connection with
distributing the Fund's shares, and will be compensated at a maximum annual
rate of 0.25 of 1% of the average daily net assets of the Fund.
Amounts received by the Adviser may be retained by the Adviser as
compensation for its services, or paid to other investment professionals who
provide services in connection with the distribution of Fund shares. The
Trustees will review the services provided and compensation paid pursuant to
the Distribution Plan no less often than quarterly.
The Adviser acts as the exclusive agent for sales of shares of the Fund
pursuant to a Principal Underwriting Agreement. Prior to April 1, 1998, the
Adviser received a sales commission of 3% of the offering price of the Fund's
shares. The sales commission was eliminated when the Fund adopted the
Distribution Plan.
During the years ended December 31, 1997, 1996, and 1995, the Adviser
received sales commissions of $513,417, $475,319, and $406,631, respectively,
pursuant to the Principal Underwriting Agreement. The only compensation
currently received by the Adviser in connection with the sale of Fund shares
is pursuant to the Distribution Plan.
TRANSFER AGENT
Under a separate contract, the functions of the Transfer Agent and
Dividend Disbursing Agent are performed by Amway Management Company, Ada,
Michigan, which acts as the Fund's agent for transfer of the Fund's shares
and for payment of dividends and capital gain distributions to shareholders.
In return for its services, the Fund pays the Transfer Agent, pursuant
to the contract, a fee of $1.167 per account in existence during the month,
payable monthly, less earnings in the redemption liquidity account after
deducting bank fees, if any. The fee schedule is reviewed annually by the
Board of Directors.
8
<PAGE>
AMWAY MUTUAL FUND
CUSTODIAN
The portfolio securities of the Fund are held, pursuant to a Custodian
Agreement, by Michigan National Bank, 77 Monroe Avenue, Grand Rapids,
Michigan, as Custodian. The Custodian performs no managerial or policymaking
functions for the Fund.
AUDITORS
BDO Seidman, LLP, 99 Monroe Avenue, N.W., Suite 800, Grand Rapids,
Michigan, are the independent certified public accountants for the Fund.
Services include an annual audit of the Fund's financial statements, tax
return preparation, and review of certain filings with the SEC.
ORGANIZATION OF THE FUND
The Fund is a series of Amway Mutual Fund Trust, an open-end management
investment company which was organized as a Delaware business trust on
February 2, 1998. The Fund is the successor of Amway Mutual Fund, Inc., which
was organized as a Delaware corporation on February 13, 1970.
The Fund is presently the only series of the Trust. The Declaration of
Trust authorizes the Trustees to create additional series and to issue an
unlimited number of units of beneficial interest, or "shares." The Trustees
are also authorized to issue different classes of shares of any series. No
series which may be issued by the Trust is entitled to share in the assets of
any other series or is liable for the expenses or liabilities of any such
series.
When issued, shares of beneficial interest ("Shares") in the Fund will be
fully paid and non-assessable. Shares are freely transferable and have no
preemptive, subscription or conversion "rights." Each share has a par value of
$1.00.
The Trust is not required to hold annual meetings of shareholders and
does not intend to hold such meetings. Shareholders of the Trust will have
voting rights only with respect to the limited number of matters specified in
the Declaration of Trust, and such other matters as may be determined by the
Trustees or as may be required by law. A meeting will be called for the
purpose of voting on the removal of a Trustee at the written request of
holders of 10% of the Trust's outstanding shares. In the event a meeting of
shareholders is held, each share will be entitled to one vote on all matters
presented to shareholders, including the election of Trustees. In the event
that Amway Management Company ceases to be the investment advisor for the
Fund or the Trust, the right of the Fund and the Trust or the Fund to use the
identifying name "Amway" may be withdrawn.
PURCHASE OF SHARES
Pursuant to a Principal Underwriter Agreement, the Investment Advisor
acts as exclusive agent for the sale of shares of the Fund. The minimum
initial investment required to establish an account is $500. An additional
investment in the minimum amount of $50 can be made in your account at any
time. Investments are made at the offering price, which includes a sales
charge (see "Determination of Net Asset Value and Offering Price of the
Fund's Shares"), next determined after the Fund receives your purchase
application and investment.
You may open a new account with the Fund by completing the enclosed
application, submitting your check made payable to Amway Management Company
and mailing the required information to Amway Management Company, 7575 Fulton
Street East, Ada, Michigan 49355-7150.
You may make additional investments to existing accounts by mail, wire,
or by the use of the pre-authorized check privilege. When making an
additional investment by check, please tear-off the stub from your statement
of account, or enclose a letter of instructions including your account number
and your check made payable to Amway Management Company. Wire transfers would
normally be used for large purchases. You may also arrange to make periodic
investments through automatic deductions from your checking account by
completing the appropriate form and providing the necessary documentation to
establish this privilege. Please contact the Fund for additional information
for utilizing either of these two options.
9
<PAGE>
AMWAY MUTUAL FUND
When your first investment is received, the Fund will open an investment
account for you which will remain open as long as you are a shareholder. This
account offers you a simple means of purchasing shares of the Fund whenever
you choose without submitting any additional application forms. This account
is also designed to encourage you to make investments regularly towards your
financial goals, but you have no obligation to purchase any specified amount
of shares and you may terminate your account at any time. When the Investment
Advisor receives your investment, it will purchase for your account the
corresponding number of the Fund's shares, and any fraction of a share
carried out to three decimal places, at the offering price next computed
after your investment is received by the Investment Advisor.
Each time you purchase shares or sell shares, you will receive a
Statement of Account showing the number of shares then in your investment
account.
Under this arrangement, stock certificates will not be delivered to you
unless you so request in writing, in which cases a certificate will promptly
be delivered to you or your bank for the number of shares, not including
fractional shares, which you own. It will generally be for your convenience
not to receive stock certificates, as you are spared the trouble and expense
of safeguarding stock certificates and the cost of a lost instrument bond in
case of loss or destruction. Since stock certificates are unnecessary except
for certain purposes, such as collateral for a loan, we recommend that you
leave your shares on deposit until you need a certificate. If certificates
have been issued for shares, they must be surrendered for redemption or
transfer of those shares.
DETERMINATION OF NET ASSET VALUE AND OFFERING PRICE
OF THE FUND'S SHARES
The net asset value of the Fund's shares is determined by dividing the
total current value of the assets of the Fund, less its liabilities, by the
number of shares outstanding at that time. This determination is made as of
the close of business on the New York Stock Exchange, 4:00 P.M. Eastern time,
on each business day on which that Exchange is open or on any other day in
which there is a sufficient degree of trading in the Fund's portfolio, except
no computation will be made on a day in which no order to purchase or redeem
was received. National holidays on which the New York Stock Exchange and the
Fund will be closed are: New Year's Day, Washington's Birthday, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas
Day.
In determining the current value of the Fund's assets, securities listed
or admitted to trading on a national securities exchange are valued at their
last reported sale price on the market where principally traded, before the
time of valuation. If a security is traded only in the over-the-counter
market or if no sales have been reported for a listed security on that day,
it will be valued at the mean between the current closing bid and asked
prices. Securities for which market quotations are not readily available,
including any restricted securities, and other assets of the Fund are valued
at fair market value as determined in good faith by the Fund's Board of
Trustees. The offering price is the net asset value per share at the next
determined value after the order is placed, as determined above.
10
<PAGE>
AMWAY MUTUAL FUND
HOW SHARES ARE REDEEMED
The Fund will redeem your shares AT THE NET ASSET VALUE NEXT DETERMINED
AFTER receiving a proper request, as described in the Prospectus.
Payment for redeemed shares is normally made in cash and mailed within
seven days thereafter. However, under the Investment Company Act of 1940, the
right of redemption may be suspended or the date of payment postponed for
more than seven days: (1) for any period during which the New York Stock
Exchange is closed, other than for customary weekend and holiday closings;
(2) when trading on the New York Stock Exchange is restricted, as determined
by the SEC; (3) when an emergency exists, as determined by the SEC, as a
result of which it is not reasonably practicable for the Fund to dispose of
its securities or determine the value of its nets assets; or (4) for such
other period as the SEC may by order permit for the protection of the
shareholders. During such a period, a shareholder may withdraw his request
for redemption or receive the net asset value next computed when regular
trading resumes.
The Fund has filed with the SEC an election to pay for all redeemed
shares in cash up to a limit, as to any one shareholder during any 90-day
period, of $250,000 or 1% of the net asset value of the Fund, whichever is
less. Beyond that limit, the Fund is permitted to pay the redemption price
wholly or partly "in kind," that is, by distribution of portfolio securities
held by the Fund. This would occur only upon specific authorization by the
Board of Directors when, in their judgment, unusual circumstances make it
advisable. It is unlikely that this will ever happen, but if it does, you
will incur a brokerage charge in converting the securities received in this
manner into cash. Portfolio securities distributed "in kind" will be valued
as they are valued for the determination of the net asset value of the Fund's
shares.
MONEY MARKET FUND EXCHANGE PRIVILEGE
The Underwriter for Amway Mutual Fund, Inc. ("Fund") has arranged for
shares of the three money market portfolios of Cash Equivalent Fund, an
open-end money market mutual fund ("Money Market Fund") to be available in
exchange for shares of the Fund for shareholders resident in the U.S. Also,
clients of the Underwriter can exchange shares in the Money Market Fund for
shares of the Fund. Shares of the Money Market Fund so acquired (including
any reinvested dividends thereon) may be re-exchanged for shares of the Fund
without sales charge. All other shares will be subject to the sales charge
(see "Determination of Net Asset Value and Offering Price of the Fund's
shares"). The Underwriter receives a maximum fee from Kemper Financial
Services, Inc., the distributor and administrator for the Money Market Fund,
of .38 of 1% per year of the average daily net asset value of shares of the
Money Market and Government Securities Portfolios, and of .33 of 1% per year
of the average daily net asset value of shares of Tax-Exempt Portfolio,
acquired through this exchange privilege. This exchange privilege does not
constitute an offering or recommendation by the Fund of the Money Market
Fund. The Money Market Fund is separately managed.
11
<PAGE>
AMWAY MUTUAL FUND
The above described Exchange Privilege may be exercised by sending
written instruction to the Transfer Agent. See "How Shares Are Redeemed" for
applicable signatures and signature guarantee requirements. Shareholders may
authorize telephone or telegram exchanges or redemptions by making an
election on your application. Procedures required by the Fund to ensure that
a shareholder's requested telephone or telegram transaction is genuine
include identification by the shareholder of the account by number, recording
of the requested transaction and sending a written confirmation to
shareholders reporting the requested transaction. The Fund is not responsible
for unauthorized telephone or telegram exchanges unless the Fund fails to
follow these procedures. Shares must be owned for 15 days before exchanging
and cannot be in certificate form unless the certificate is tendered with the
request for exchange. An exchange requires the purchase of shares of the
particular portfolio of the Money Market Fund with a value of at least $1,000
to establish a new account or $100 to add to an existing account. Exchanges
will be accepted only if the registration of the two accounts is identical.
Exchange redemptions and purchases are effected on the basis of the net asset
value next determined after receipt of the request in proper order by the
Fund. In the case of exchanges into the Money Market Fund, dividends
generally commence on the following business day. For federal and state
income tax purposes, an exchange is treated as a sale and may result in a
capital gain or loss, although if the shares exchanged have been held less
than 91 days, the sales charge paid on such shares is not included in the tax
basis of the exchanged shares, but is carried over and included in the tax
basis of the shares acquired.
A prospectus for the Money Market Fund which contains information
concerning charges and expenses may be obtained from the Underwriter. A
shareholder should read the prospectus carefully and consider differences in
objectives and policies before making any exchange. The Fund or the
Underwriter can change or discontinue this privilege, although shareholders
generally would be given 60 days advance notice of any termination or
material amendment of the Fund Exchange Privilege and shareholders who had
exchanged into the Money Market Fund generally would be permitted to
reacquire shares of the Fund without sales charge for at least 60 days after
notice of termination of the Exchange Privilege with the Money Market Fund.
12
<PAGE>
AMWAY MUTUAL FUND
FEDERAL INCOME TAX
The Fund intends to continue to comply with the provisions of Subchapter
M of the Internal Revenue Code applicable to investment companies.
Accordingly, as the result of paying to its shareholders as dividends and
distributions substantially all net investment income and realized capital
gains, if any, the Fund will be relieved of substantially all Federal income
tax.
For Federal income tax purposes, distributions of net investment income
and any capital gains will be taxable to shareholders. Distributions of net
investment income will normally qualify for the 70% deduction for dividends
received by corporations. After the last dividend and capital gains
distribution in each year, the Fund will send you a statement of the amount
of the income and capital gains which you should report on your Federal
income tax return. Dividends derived from net investment income and net
short-term capital gains are taxable to shareholders as ordinary income and
long-term capital gain dividends are taxable to shareholders as long-term
capital gain regardless of how long the shares have been held and whether
received in cash or reinvested in additional shares of the Fund. Qualified
long-term capital gain dividends received by individual shareholders are
taxed a maximum rate of 28%.
In addition, shareholders may realize a capital gain or loss when shares
are redeemed. For most types of accounts, the Fund will report the proceeds
of redemptions to shareholders and the IRS annually. However, because the tax
treatment also depends on the purchase price and a shareholder's personal tax
position, you should also keep your regular account statements to use in
determining your tax.
On the record date for a distribution, the Fund's share value is reduced
by the amount of the distribution. If a shareholder buys shares just before
the record date ("buying a dividend"), they will pay the full price for the
shares, and then receive a portion of the price back as a taxable
distribution.
Also, under the Code, a 4% excise tax is imposed on the excess of the
required distribution for a calendar year over the distributed amount for
such calendar year. The required distribution is the sum of 98% of the Fund's
net investment income for the calendar year plus 98% of its capital gain net
income for the one-year period ended December 31, plus any undistributed net
investment income from the prior calendar year, plus any undistributed
capital gain net income from the prior calendar year, minus any over
distribution in the prior calendar year. The Fund intends to declare or
distribute dividends during the appropriate periods of an amount sufficient
to prevent imposition of the 4% excise tax.
Under certain circumstances, the Fund will be required to withhold 31%
of a shareholder's distribution or redemption from the Fund. These
circumstances include failure by the shareholder to furnish the Fund with a
proper taxpayer identification number; notification of the Fund by the
Secretary of the Treasury that a taxpayer identification number is incorrect,
or that withholding should commence as a result of the shareholder's failure
to report interest and dividends; and failure of the shareholder to certify,
under penalties of perjury, that he is not subject to withholding. In this
regard, failure of a shareholder who is a foreign resident to certify that he
is a nonresident alien may result in 31% of his redemption proceeds and 31%
of his capital gain distribution being withheld. In addition, such a foreign
resident may be subject to a 30% or less, as prescribed by an applicable tax
treaty, withholding tax on ordinary income dividends distributed unless he
qualifies for relief under an applicable tax treaty.
13
<PAGE>
AMWAY MUTUAL FUND
Trustees of qualified retirement plans are required by law to withhold
20% of the taxable portion of any distribution that is eligible to be "rolled
over." The 20% withholding requirement does not apply to distributions from
IRA's or any part of a distribution that is transferred directly to another
qualified retirement plan, 403(b)(7) account or IRA. Shareholders should
consult their tax advisor regarding the 20% withholding requirement.
Prior to purchasing shares of the Fund, the impact of any dividends or
capital gain distributions which are about to be declared should be carefully
considered. Any such dividends and capital gain distributions declared
shortly after you purchase shares will have the effect of reducing the per
share net asset value of your shares by the amount of dividends or
distributions on the ex-dividend date. All or a portion of such dividends or
distributions, although in effect a return of capital, are subject to taxes
which may be at ordinary income tax rates.
Each shareholder is advised to consult with his tax advisor regarding the
treatment of distributions to him under various state and local income tax laws.
INVESTMENT PERFORMANCE INFORMATION
Following is a table illustrating the Fund's performance for annual
periods ended December 31, 1997, and its average annual total return
percentages for one, five and ten years.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Accumulative Accumulative
Value of Shares Value of Shares
Calendar Years Cost of Value of Accepted As Accepted As
Ended Initial Initial Capital Gain Ordinary Income Total
December 31 Investment Investment Distributions Dividends Value
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1988 $1,000 825 226 18 1,069
1989 922 451 46 1,419
1990 867 509 58 1,434
1991 1,031 921 82 2,034
1992 962 1,026 82 2,070
1993 980 1,225 89 2,294
1994 874 1,196 89 2,159
1995 944 1,746 129 2,819
1996 968 2,336 168 3,472
1997 982 3,057 214 4,253
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Average Annual Total Return For
The Periods Ended December 31, 1997
Amway Ark (Sub-advisor) Composite
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
One Year 22.47% 22.67%
Five Years 15.51% 19.56%
Ten Years 15.58% 17.48%
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
14
<PAGE>
AMWAY MUTUAL FUND
Total return performance for the Fund is calculated by making an initial
investment of $1,000 at the beginning of the period, in the Fund's shares at
the NET ASSET VALUE (WITHOUT SALES CHARGE) and reinvesting all ordinary
income dividends and capital gain distributions paid during the period in
additional shares at net asset value per share on the reinvestment dates.
Prior to 1991 and 1998 the Fund had a maximum sales charge of 6% and 3%,
respectively, based upon amount of shares purchased. The illustration
includes recurring expenses incurred by all shareholder accounts and not
those incurred for specific shareholder purposes such as bank fees for wire
transfers, Individual Retirement Accounts, or Profit-Sharing Trusts.
Total return performance also includes the composite performance of the
Fund's current sub-adviser, ARK Asset Management Company, who has been the
Fund's sub-adviser since May 1, 1995. The composite performance sets forth
the returns of the institutional private accounts managed by the sub-adviser
which have substantially similar investment objectives and policies as the
Fund. The data is provided to illustrate the past performance of the
sub-adviser in managing substantially similar accounts and does not represent
the performance of the Fund.
Shareholders should not consider the composite performance data as an
indication of future performance of the sub-adviser. The investment results
of the sub-adviser composite presented is unaudited and calculated in
accordance with the recommended standards of the Association for Investment
Management and Research retroactively applied to all time periods. All
composite returns presented were calculated on a total return basis and
included all dividends and interest, accrued income and realized and
unrealized gains and losses, and deductions for brokerage commissions and
execution costs. Composite returns are adjusted to assume that the Fund's
operating charges, expenses, and fees (the Fund's historical expense ratio)
were deducted during such periods. No adjustment has been made for the
impact on the expense ratio due to growth in the Fund's assets, RECENT
REDUCTION OF management fees or the adoption of a 12b-1 Distribution Plan.
The average annual total return for the Fund and Ark Composite for a
specific period is found by dividing the ending total value by the cost of
the initial investment for the period and taking this quotient to the Nth
root, then subtracting 1 (N represents the number of years in the period).
The average annual total return reflects the hypothetical annually compounded
return that would have produced the same cumulative total return if the
Fund's performance had been constant over the entire period. Such calculation
is with all ordinary income dividends and capital gain distributions
reinvested at net asset value exclusive of sales charges. No adjustment has
been made for any income taxes payable by shareholders on ordinary income
dividends and capital gain distributions accepted in shares which are payable
by shareholders in the tax year received.
Average annual total return percentages of the Fund will vary and the
publication of performance results is not a representation as to future
investment performance. Factors affecting the Fund's performance include
general market conditions, operating expenses and investment management. Net
asset values of the Fund will fluctuate. Additional information about the
performance of the Fund is contained in the Annual Shareholders Report which
can be obtained without charge.
REPORTS TO SHAREHOLDERS AND ANNUAL AUDIT
The Fund's year begins on January 1 and ends on December 31. At least
semiannually, the shareholders of the Fund receive reports, pursuant to
applicable laws and regulations, containing financial information. The annual
shareholders report is incorporated by reference into the Statement of
Additional Information. The cost of printing and distribution of such reports
to shareholders is borne by the Fund.
At least once during each year, the Fund is audited by independent
certified public accountants appointed by resolution of the Board and
approved by the shareholders. The fees and expenses of the auditors are paid
by the Fund.
The financial statements for the Fund are contained in the Fund's 1997
Annual Report to Shareholders along with additional information about the
performance of the Fund, which is incorporated herein by reference and may be
obtained by writing or calling the Fund.
15
<PAGE>
AMWAY MUTUAL FUND
7575 Fulton Street East
Ada, Michigan, 49355-7150
(616) 787-6288
(800) 346-2670
Contents Page
Objectives, Policies, and
Restrictions on the Fund's
Investments 3
Portfolio Transactions and
Brokerages 4
Principal Shareholders 5
Officers and Directors of the Fund 5
Investment Advisor and Other Services 6
Distribution of Shares 8
Transfer Agent 9
Custodian 9
Auditors 9
Voting Rights of Common Shareholders 9
Purchase of Shares 9
Determination of Net Asset Value
and Offering Price of the Fund's
Shares 10
How Shares are Redeemed 11
Reinvestment Privilege 11
Money Market Fund Exchange Privilege 12
Federal Income Tax 13
Investment Performance Information 14
Reports to Shareholders and
Annual Audit 15
Printed in U.S.A.
Amway
Mutual
Fund,
Statement of
Additional Information
April 28, 1998
AMWAY MUTUAL FUND LOGO
16
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits
(a) Financial Statements:
The financial statements listed below are incorporated by
reference to the Registration Statement under the Securities Act
of 1933, Post Effective Amendment No. 43, Part C, Pages 40
through 53, as filed on February 27, 1998.
Location in Registration Statement
Part A Part B Part C
(Prospectus) (Statement of
Additional
Information)
Page No. Page No. Page No.
------------ -------------- -------------
Independent Auditors' Report
Assets and Liabilities
Year Ended December
31, 1997
Statement of Income
Year Ended December
31, 1997
Schedule of Investments
Year Ended December
31, 1997
Changes in Net Assets
Years Ended December
31, 1997 and 1996
Consent of Independent Certified
Public Accountants
C-1
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits (Continued)
(a) Exhibits:
i. DECLARATION OF TRUST
The Declaration of Trust for Amway Mutual Fund Trust
(a Delaware Trust) is included on Pages C-7 through C-35.
ii. BY-LAWS
The By-Laws of Amway Mutual Fund Trust (a Delaware
trust), is incorporated by reference to the Registration
Statement under the Securities Act of 1933, Post Effective
Amendment No. 43, Part C, Pages 83 through 97, as filed on
February 27, 1998.
iii. CERTIFICATE OF OWNERSHIP INTERESTS
The Certificate of Ownership Interests is included on
Page C-36.
iv. ADVISORY AND SERVICE CONTRACT BETWEEN AMWAY MUTUAL FUND AND
AMWAY MANAGEMENT COMPANY
The Restated Advisory and Service Contract between Amway
Mutual Fund and Amway Management Company is included on Pages
C-37 through C-39.
v. SUB-ADVISORY AGREEMENT
The Restated Sub-Advisory Agreement between Amway
Management Company and ARK Asset Management Company, Inc.,
with amendments, is included on Pages C-40 through C-42.
C-2
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits (Continued)
(b) Exhibits:
vi. PRINCIPAL UNDERWRITER AGREEMENT BETWEEN AMWAY MUTUAL FUND
AND AMWAY MANAGEMENT COMPANY
The Restated Principal Underwriter Agreement between
Amway Mutual Fund and Amway Management Company is included
on Pages C-43 through C-48.
vii. CUSTODIAN AGREEMENT
The Amended Custodian Agreement is incorporated by
reference to the Registration Statement under the Securities
Act of 1933, Post-Effective Amendment No. 41, Part C, Pages
C-100 through C-112, as filed on March 1, 1996, except for
the amendment which is included herein on Page C-49.
viii. TRANSFER AGENCY AND DIVIDEND DISBURSING AGENCY AGREEMENT
BETWEEN AMWAY MUTUAL FUND. AND AMWAY MANAGEMENT COMPANY
The Restated Transfer Agency and Dividend Disbursing
Agency Agreement between Amway Mutual Fund and Amway
Management Company is included on Pages C-50 through C-51.
ix. COMMON-RECORDS AGREEMENT AMONG AMWAY MUTUAL FUND AND AMWAY
MANAGEMENT COMPANY
The Restated Common-Records Agreement between Amway
Mutual Fund and Amway Management Company is included on
Page C-52.
C-3
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits (Continued)
(b) Exhibits
x. PORTFOLIO ACCOUNTING AND RESEARCH INFORMATION SYSTEM
The Portfolio Accounting and Research Information
System Agreement between Amway Management Company and DST
Securities, Inc. is incorporated by reference to the
Registration Statement under the Securities Act of 1933,
Post Effective Amendment No. 41, Part C, Pages C-122
through C-147, as filed on March 1, 1996, except for the
amendment dated May 1, 1998 included on Pages C-53
through C-56.
xi. LEGAL OPINION
The legal opinion is included on Page C-57.
xii. FINANCIAL STATEMENT
The Annual Report for Amway Mutual Fund, Inc.
is incorporated by reference to the Registration
Statement under the Securities Act of 1933, Post
Effective Amendment No. 43, Part C, Pages C-8 through
C-22, as filed on February 27, 1998.
xiii. TRUST AGREEMENT ESTABLISHING THE AMWAY MUTUAL FUND MASTER
PROFIT-SHARING TRUST AND RELATED DOCUMENTS
The Trust Agreement establishing the Amway
Management Company Master Profit-Sharing Trust and
related documents is incorporated by reference to the
Registration Statement under the Securities Act of 1933,
Post Effective Amendment No. 43, Part C, Pages C-95
through C-130, as filed on February 27, 1998.
xiv. TRUST AGREEMENT ESTABLISHING THE AMWAY MUTUAL FUND
INDIVIDUAL RETIREMENT ACCOUNT AND RELATED DOCUMENTS
The Trust Agreement establishing the Amway
Management Company Individual Retirement Account and
related documents, as amended, are incorporated by
reference to the Registration Statement under the
Securities Act of 1933, Post Effective Amendment No. 43,
Part C, Pages C-131 through C-188, as filed on February
27, 1998.
C-4
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. Financial Statement and Exhibits (Continued)
(b) Exhibits
xv. 12b-1 PLAN FOR DISTRIBUTION
The Restated 12b-1 Plan for Distribution is included
on Pages C-58 through Page C-61.
xvi. APPLICATION ESTABLISHING AN AMWAY MUTUAL FUND INVESTMENT
The Application establishing an investment with
Amway Mutual Fund is incorporated by reference to the
Registration Statement under the Securities Act of 1933,
Post Effective Amendment No.42, Part C, Pages C-20 and
C-21.
xvii. EXHIBIT OF PERFORMANCE CALCULATIONS
The schedules for computation of each
performance quotation provided in the Registration
Statement in response to Item 22 are incorporated by
reference to the Registration Statement under the
Securities Act of 1933, Post Effective Amendment No. 43,
Part C, Pages C-193 through C-195, as filed on February
27, 1998.
xviii. POWER OF ATTORNEY
The Power of Attorney authorizing the signer of
the Registration Statement to sign as Attorney-In-Fact
for certain Directors is incorporated by reference to the
Registration Statement under the Securities Act of 1933,
Post Effective Amendment No. 43, Part C, Page C-196, as
filed on February 27, 1998.
C-5
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
LOCATION IN REGISTRATION STATEMENT
Part A Part B Part C
(Prospectus) (Statement of
Additional
Information)
Page No. Page No. Page No.
------------ ------------- -----------
ITEM 25. Persons Controlled by
or under Common Control C-62
with Registrant
ITEM 26. Number of Holders of
Securities C-62
ITEM 27. Indemnification C-62
ITEM 28. Business and Other
Connections of C-62
Investment Adviser
ITEM 29. Principal Underwriter C-63
ITEM 30. Location of Accounts
and Records C-63
ITEM 31. Management Services C-63
ITEM 32. Undertakings C-64
C-6
<PAGE>
AGREEMENT AND DECLARATION OF TRUST
of
AMWAY MUTUAL FUND
a Delaware Business Trust
Principal Place of Business:
7575 Fulton Street East
Ada, Michigan 49355
Agent for Service of
Process in Delaware:
Corporation Trust Company
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
C-7
<PAGE>
AGREEMENT AND DECLARATION OF TRUST
AMWAY MUTUAL FUND TRUST
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
ARTICLE 1 Name and Definitions ................................ 1
Section 1 Name ................................................. 1
Section 2 Definitions........................................... 1
Adviser(s)............................................ 1
By-Laws............................................... 1
(a) Certificate of Trust............................. 1
(b) Class............................................ 1
(c) Commission....................................... 1
(d) Declaration of Trust............................. 1
(e) Delaware Act..................................... 2
(f) Interested Person................................ 2
(g) 1940 Act......................................... 2
(h) Person........................................... 2
(i) Principal Underwriter............................ 2
(j) Series........................................... 2
(k) Unitholders...................................... 2
(l) Units............................................ 2
(m) Trust............................................ 2
(n) Trust Property .................................. 2
(o) Trustees......................................... 2
ARTICLE II Purpose of Trust ..................................... 3
ARTICLE III Units ................................................ 3
Section 1 Division of Beneficial Interest ...................... 3
Section 2 Ownership of Units ................................... 4
Section 3 Transfer of Units .................................... 4
Section 4 Investments in the Trust.............................. 4
Section 5 Status of Units and Limitation of Personal Liability.. 4
Section 6 Establishment, Designation, Abolition or Termination,
etc. of Series or Class .............................. 5
(a) Assets held with Respect to a Particular Series.. 5
(b) Liabilities Held with Respect to a Particular
Series .......................................... 6
(c) Dividends, Distributions, Redemptions and
Repurchases ..................................... 6
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(d) Equality......................................... 7
(e) Fractions ....................................... 7
(f) Exchange Privilege .............................. 7
(g) Combination of Series ........................... 7
Section 7 Number of Units ...................................... 7
ARTICLE IV Trustees.............................................. 8
Section 1 Number, Election and Tenure .......................... 8
Section 2 Effect of Death, Resignation, etc. of a Trustee ...... 8
Section 3 Powers ............................................... 9
Section 4 Payment of Expenses by the Trust...................... 12
Section 5 Payment of Expenses by Unitholders ................... 13
Section 6 Ownership of Assets of the Trust ..................... 13
Section 7 Services Contracts .................................. 13
Section 8 Trustees and Officers as Unitholders ................. 14
Section 9 Compensation ....................................... 14
ARTICLE V Unitholders' Voting Powers and Meetings .............. 15
Section 1 Voting Powers, Meetings, Notice and Record Dates...... 15
Section 2 Quorum and Required Vote ............................. 15
Section 3 Record Dates ......................................... 16
Section 4 Additional Provisions ................................ 16
ARTICLE VI Net Asset Value, Distributions and Redemptions ....... 16
Section 1 Determination of Net Asset Value, Net Income and
Distributions ....................................... 16
Section 2 Redemptions and Repurchases........................... 16
ARTICLE VII Limitation of Liability; Indemnification ............. 17
Section 1 Trustees, Unitholders, etc. Not Personally Liable;
Notice ............................................... 17
Section 2 Trustees' Good Faith Action; Expert Advice; No
Bond or Surety ....................................... 18
Section 3 Indemnification of Unitholders ....................... 19
Section 4 Indemnification of Trustees, Officers, etc. .......... 19
Section 5 Compromise Payment .................................. 20
Section 6 Indemnification Not Exclusive, etc. .................. 20
Section 7 Liability of Third Persons Dealing with Trustees ..... 21
Section 8 Insurance ............................................ 21
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<PAGE>
ARTICLE VIII Miscellaneous......................................... 21
Section 1 Termination of the Trust or Any Series or Class ...... 21
Section 2 Reorganization ....................................... 22
Section 3 Amendments ........................................... 23
Section 4 Filing of Copies; References; Headings ............... 23
Section 5 Applicable Law ....................................... 23
Section 6 Provisions in Conflict with Law or Regulations ....... 24
Section 7 Business Trust Only .................................. 24
</TABLE>
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<PAGE>
AGREEMENT AND DECLARATION OF TRUST
AMWAY MUTUAL FUND TRUST
THIS AGREEMENT AND DECLARATION OF TRUST is made and entered into as of
the date set forth below by the Trustees named hereunder for the purpose of
forming a Delaware business trust in accordance with the provisions
hereinafter set forth.
NOW, THEREFORE, the Trustees hereby direct that the Certificate of Trust
be filed with the Office of the Secretary of State of the State of Delaware
and do hereby declare that the Trustees will hold IN TRUST all cash,
securities, and other assets which the Trust now possesses or may hereafter
acquire from time to time in any manner and manage and dispose of the same
upon the following terms and conditions for the benefit of the holders of
Units of this Trust.
ARTICLE I
Name and Definitions
Section 1. Name. This Trust shall be known as Amway Mutual Fund Trust
and the Trustees shall conduct the business of the Trust under that name or
any other name as they may from time to time determine.
Section 2. Definitions. Whenever used herein, unless otherwise required
by the context or specifically provided:
(a) "Adviser(s)" means a party or parties furnishing services to the
Trust pursuant to any investment advisory or investment management contract
described in Article IV, Section 6(a) hereof;
(b) "By-Laws" shall mean the By-Laws of the Trust as amended from time
to time, which By-Laws are expressly herein incorporated by reference as part
of the "governing instrument" within the meaning of the Delaware Act;
(c) "Certificate of Trust" means the certificate of trust, as amended or
restated from time to time, filed by the Trustees in the Office of the
Secretary of State of the State of Delaware in accordance with the Delaware
Act;
(d) "Class" means a class of Units of a Series of the Trust established
in accordance with the provisions of Article III hereof;
(e) "Commission" shall have the meaning given such term in the 1940 Act;
(f) "Declaration of Trust" means this Agreement and Declaration of Trust,
as amended or restated from time to time;
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<PAGE>
(g) "Delaware Act" means the Delaware Business Trust Act, 12 Del. C.
ss.ss. 3801 et seq., as amended from time to time;
(h) "Interested Person" shall have the meaning given it in Section
2(a)(19) of the 1940 Act;
(i) "1940 Act" means the Investment Company Act of 1940 and the rules
and regulations thereunder, all as amended from time to time;
(j) "Person" means and includes individuals, corporations, partnerships,
trusts, associations, joint ventures, estates, and other entities, whether or
not legal entities, and governments and agencies and political subdivisions
thereof, whether domestic or foreign;
(k) "Principal Underwriter" shall have the meaning given such term in
the 1940 Act;
(l) "Series" means each Series of Units established and designated under
or in accordance with the provisions of Article III hereof; and where the
context requires or where appropriate, shall be deemed to include "Class" or
"Classes";
(m) "Unitholder" means a record owner of outstanding Units;
(n) "Units" means the units of beneficial interest into which the
beneficial interest in the Trust shall be divided from time to time and
includes fractions of Units as well as whole Units;
(o) "Trust" means the Delaware Business Trust established under the
Delaware Act by this Declaration of Trust and the filing of the Certificate
of Trust in the Office of the Secretary of State of the State of Delaware;
(p) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is from time to time owned or held by or for
the account of the Trust; and
(q) "Trustees" means the Person or Persons who have signed this Declaration
of Trust and all other Persons who may from time to time be duly
elected or appointed to serve as Trustees in accordance with the
provisions hereof, in each case so long as such Person shall continue
in office in accordance with the terms of this Declaration of Trust,
and reference herein to a Trustee or the Trustees shall refer to such
Person or Persons in his or her or their capacity as Trustees
hereunder.
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<PAGE>
ARTICLE II
Purpose of Trust
The purpose of the Trust is to conduct, operate and carry on the
business of an investment company registered under the 1940 Act through one
or more Series and to carry on such other business as the Trustees may from
time to time determine. The Trustees shall not be limited by any law limiting
the investments which may be made by fiduciaries.
ARTICLE III
Units
Section 1. Division of Beneficial Interest. The beneficial interest in
the Trust shall be divided into one or more Series. The Trustees may divide
each Series into Classes. Subject to the further provisions of this Article
III and any applicable requirements of the 1940 Act, the Trustees shall have
full power and authority, in their sole discretion, and without obtaining any
authorization or vote of the Unitholders of any Series or Class thereof, (i)
to divide the beneficial interest in each Series or Class thereof into Units,
with or without par value as the Trustees shall determine, (ii) to issue
Units without limitation as to number (including fractional Units) to such
Persons and for such amount and type of consideration, including cash or
securities, subject to any restriction set forth in the By-Laws, at such time
or times and on such terms as the Trustees may deem appropriate, (iii) to
establish and designate and to change in any manner any Series or Class
thereof and to fix such preferences, voting powers, rights, duties and
privileges and business purpose of each Series or Class thereof as the
Trustees may from time to time determine, which preferences, voting powers,
rights, duties and privileges may be senior or subordinate to (or in the case
of business purpose, different from) any existing Series or Class thereof and
may be limited to specified property or obligations of the Trust or profits
and losses associated with specified property or obligations of the Trust,
(iv) to divide or combine the Units of any Series or Class thereof into a
greater or lesser number without thereby materially changing the
proportionate beneficial interest of the Units of such Series or Class
thereof in the assets held with respect to that Series, (v) to classify or
reclassify any issued Units of any Series or Class thereof into Units of one
or more Series or Classes thereof; (vi) to change the name of any Series or
Class thereof; (vii) to abolish or terminate any one or more Series or
Classes thereof; (viii) to refuse to issue Units to any Person or class of
Persons; and (ix) to take such other action with respect to the Units as the
Trustees may deem desirable.
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<PAGE>
Subject to the distinctions permitted among Classes of the same Series
as established by the Trustees, consistent with the requirements of the 1940
Act, each Unit of a Series of the Trust shall represent an equal beneficial
interest in the net assets of such Series, and each holder of Units of a
Series shall be entitled to receive such Unitholder's pro rata share of
distributions of income and capital gains, if any, made with respect to such
Series and upon redemption of the Units of any Series, such Unitholder shall
be paid solely out of the funds and property of such Series of the Trust.
All references to Units in this Declaration of Trust shall be deemed to
be Units of any or all Series or Classes thereof, as the context may require.
All provisions herein relating to the Trust shall apply equally to each
Series of the Trust and each Class thereof, except as the context otherwise
requires.
All Units issued hereunder, including, without limitation, Units issued
in connection with a dividend or other distribution in Units or a split or
reverse split of Units, shall be fully paid and nonassessable. Except as
otherwise provided by the Trustees, Unitholders shall have no preemptive or
other right to subscribe to any additional Units or other securities issued
by the Trust.
Section 2. Ownership of Units. The ownership of Units shall be recorded
on the books of the Trust or those of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Units of each
Series or Class of the Trust. No certificates certifying the ownership of
Units shall be issued except as the Trustees may otherwise determine from
time to time. The Trustees may make such rules as they consider appropriate
for the issuance of Unit certificates, the transfer of Units of each Series
or Class of the Trust and similar matters. The record books of the Trust as
kept by the Trust or any transfer or similar agent, as the case may be, shall
be conclusive as to the identity of the Unitholders of each Series or Class
of the Trust and as to the number of Units of each Series or Class of the
Trust held from time to time by each Unitholder.
Section 3. Transfer of Units. Except as otherwise provided by the
Trustees, Units shall be transferable on the books of the Trust only by the
record holder thereof or by his or her duly authorized agent upon delivery to
the Trustees or the Trust's transfer agent of a duly executed instrument of
transfer, together with a Unit certificate if one is outstanding, and such
evidence of the genuineness of each such execution and authorization and of
such other matters as may be required by the Trustees. Upon such delivery,
and subject to any further requirements specified by the Trustees or
contained in the By-Laws, the transfer shall be recorded on the books of the
Trust. Until a transfer is so recorded, the holder of record of Units shall
be deemed to be the holder of such Units for all purposes hereunder and
neither the Trustees nor the Trust, nor any transfer agent or registrar or
any officer, employee, or agent of the Trust, shall be affected by any notice
of a proposed transfer.
Section 4. Investments in the Trust. Investments may be accepted by the
Trust from Persons, at such times, on such terms, and for such consideration
as the Trustees from time to time may authorize.
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<PAGE>
Section 5. Status of Units and Limitation of Personal Liability. Units
shall be deemed to be personal property giving only the rights provided in
this instrument. Every Unitholder by virtue of having become a Unitholder
shall be held to have expressly assented and agreed to the terms hereof. The
death, incapacity, dissolution, termination, or bankruptcy of a Unitholder
during the existence of the Trust shall not operate to terminate the Trust,
nor entitle the representative of any such Unitholder to an accounting or to
take any action in court or elsewhere against the Trust or the Trustees, but
shall entitle such representative only to the rights of such Unitholder under
this Trust. Ownership of Units shall not entitle the Unitholder to any title
in or to the whole or any part of the Trust Property or any right to call for
a participation or division of the same or for an accounting, nor shall the
ownership of Units constitute the Unitholders as partners. No Unitholder
shall be personally liable for the debts, liabilities, obligations and
expenses incurred by, contracted for, or otherwise existing with respect to,
the Trust or any Series. Neither the Trust nor the Trustees, nor any officer,
employee, or agent of the Trust shall have any power to bind personally any
Unitholder, nor, except as specifically provided herein, to call upon any
Unitholder for the payment of any sum of money or assessment whatsoever other
than such as the Unitholder may at any time personally agree to pay.
Section 6. Establishment, Designation, Abolition or Termination etc. of
Series or Class. The establishment and designation of any Series or Class of
Units of the Trust shall be effective upon the adoption by a majority of the
Trustees then in office of a resolution that sets forth such establishment
and designation and the relative rights and preferences of such Series or
Class of the Trust, whether directly in such resolution or by reference to
another document including, without limitation, any registration statement of
the Trust, or as otherwise provided in such resolution. The abolition or
termination of any Series or Class of Units of the Trust shall be effective
upon the adoption by a majority of the Trustees then in office of a
resolution that abolishes or terminates such Series or Class.
Units of each Series or Class of the Trust established pursuant to this
Article III, unless otherwise provided in the resolution establishing such
Series or Class, shall have the following relative rights and preferences:
(a) Assets Held with Respect to a Particular Series. All consideration
received by the Trust for the issue or sale of Units of a particular Series,
together with all assets in which such consideration is invested or
reinvested, all income, earnings, profits, and proceeds thereof from whatever
source derived (including, without limitation, 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 irrevocably be held separate with respect to that Series for all
purposes, and shall be so recorded upon the books of account of the Trust.
Such consideration, assets, income, earnings, profits and proceeds thereof,
from whatever source derived, (including, without limitation, any proceeds
derived from the sale,
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<PAGE>
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,
are herein referred to as "assets held with respect to" that Series. In the
event that there are any assets, income, earnings, profits and proceeds
thereof, funds or payments which are not readily identifiable as assets held
with respect to any particular Series (collectively "General Assets"), the
Trustees shall allocate such General Assets to, between or among any one or
more of the Series in such manner and on such basis as the Trustees, in their
sole discretion, deem fair and equitable, and any General Assets so allocated
to a particular Series shall be held with respect to that Series. Each such
allocation by the Trustees shall be conclusive and binding upon the
Unitholders of all Series for all purposes. Separate and distinct records
shall be maintained for each Series and the assets held with respect to each
Series shall be held and accounted for separately from the assets held with
respect to all other Series and the General Assets of the Trust not allocated
to such Series.
(b) Liabilities Held with Respect to a Particular Series. The assets of
the Trust held with respect to each particular Series shall be charged
against the liabilities of the Trust held with respect to that Series and all
expenses, costs, charges, and reserves attributable to that Series, except
that liabilities and expenses allocated solely to a particular Class shall be
borne by that Class. Any general liabilities of the Trust which are not
readily identifiable as being held with respect to any particular Series or
Class shall be allocated and charged by the Trustees to and among any one or
more of the Series or Classes in such manner and on such basis as the
Trustees in their sole discretion deem fair and equitable. All liabilities,
expenses, costs, charges, and reserves so charged to a Series or Class are
herein referred to as "liabilities held with respect to" that Series or
Class. Each allocation of liabilities, expenses, costs, charges, and reserves
by the Trustees shall be conclusive and binding upon the Unitholders of all
Series or Classes for all purposes. Without limiting the foregoing, but
subject to the right of the Trustees to allocate general liabilities,
expenses, costs, charges or reserves as herein provided, the debts,
liabilities, obligations and expenses incurred, contracted for or otherwise
existing with respect to a particular Series shall be enforceable against the
assets held with respect to such Series only and not against the assets of
the Trust generally or against the assets held with respect to any other
Series. Notice of this contractual limitation on liabilities among Series
may, in the Trustees' discretion, be set forth in the Certificate of Trust
and upon the giving of such notice in the Certificate of Trust, the statutory
provisions of Section 3804 of the Delaware Act relating to limitations on
liabilities among Series (and the statutory effect under Section 3804 of
setting forth such notice in the certificate of trust) shall become
applicable to the Trust and each Series. Any person extending credit to,
contracting with or having any claim against any Series may look only to the
assets of that Series to satisfy or enforce any debt with respect to that
Series. No Unitholder or former Unitholder of any Series shall have a claim
on or any right to any assets allocated or belonging to any other Series.
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<PAGE>
(c) Dividends, Distributions, Redemptions, and Repurchases.
Notwithstanding any other provisions of this Declaration of Trust, including,
without limitation, Article Vl, no dividend or distribution, including,
without limitation, any distribution paid upon termination of the Trust or of
any Series or Class with respect to, nor any redemption or repurchase of, the
Units of any Series or Class, shall be effected by the Trust other than from
the assets held with respect to such Series, nor shall any Unitholder or any
particular Series or Class otherwise have any right or claim against the
assets held with respect to any other Series except to the extent that such
Unitholder has such a right or claim hereunder as a Unitholder of such other
Series. The Trustees shall have full discretion, to the extent not
inconsistent with the 1940 Act, to determine which items shall be treated as
income and which items as capital, and each such determination and allocation
shall be conclusive and binding upon the Unitholders.
(d) Equality. All the Units of each particular Series shall represent an
equal proportionate interest in the assets held with respect to that Series
(subject to the liabilities held with respect to that Series or Class thereof
and such rights and preferences as may have been established and designated
with respect to any Class within such Series), and each Unit of any
particular Series shall be equal to each other Unit of that Series. With
respect to any Class of a Series, each such Class shall represent interests
in the assets held with respect to that Series and shall have identical
voting, dividend, liquidation and other rights and the same terms and
conditions, except that expenses allocated to a Class may be borne solely by
such Class as determined by the Trustees and a Class may have exclusive
voting rights with respect to matters affecting only that Class.
(e) Fractions. Any fractional Unit of a Series or Class thereof shall
carry proportionately all the rights and obligations of a whole Unit of that
Series or Class, including rights with respect to voting, receipt of
dividends and distributions, redemption of Units and termination of the Trust.
(f) Exchange Privilege. The Trustees shall have the authority to provide
that the holders of Units of any Series or Class shall have the right to
exchange said Units for Units of one or more other Series of Units or Class
of Units of the Trust or of other investment companies registered under the
1940 Act in accordance with such requirements and procedures as may be
established by the Trustees.
(g) Combination of Series. The Trustees shall have the authority,
without the approval of the Unitholders of any Series or Class unless
otherwise required by applicable law, to combine the assets and liabilities
held with respect to any two or more Series or Classes into assets and
liabilities held with respect to a single Series or Class.
Section 7. Number of Units. The beneficial interest in the Trust shall
be divided into not more than forty million units of beneficial interest.
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<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
ARTICLE IV
Trustees
Section 1. Number, Election and Tenure. The number of Trustees shall
initially be 5 who shall be Richard A. DeWitt, Allan D. Engel, Donald H.
Johnson, Walter T. Jones, and James J. Rosloniec. Thereafter, the number of
Trustees shall at all times be at least one and no more than such number as
determined, from time to time, by the Trustees pursuant to Section 3 of this
Article IV. Each Trustee shall serve during the lifetime of the Trust until he
or she dies, resigns, has reached any mandatory retirement age as set by the
Trustees, is declared bankrupt or incompetent by a court of appropriate
jurisdiction, or is removed, or, if sooner, until the next meeting of
Unitholders called for the purpose of electing Trustees and until the election
and qualification of his or her successor. In the event that less than a
majority of the Trustees holding office have been elected by the Unitholders,
the Trustees then in office shall take such actions as may be necessary under
applicable law for the election of Trustees. Any Trustee may resign at any time
by written instrument signed by him or her and delivered to any officer of the
Trust or to a meeting of the Trustees. Such resignation shall be effective upon
receipt unless specified to be effective at some other time. Except to the
extent expressly provided in a written agreement with the Trust, no Trustee
resigning and no Trustee removed shall have any right to any compensation for
any period following his or her resignation or removal, or any right to damages
on account of such removal. The Unitholders may elect Trustees at any meeting of
Unitholders called by the Trustees for that purpose. Any Trustee may be removed
(a) at any meeting of Unitholders by a vote of two-thirds of the outstanding
Units of the Trust, or (b) by a written instrument signed by at least two-thirds
of the number of Trustees prior to such removal.
Section 2. Effect of Death, Resignation, etc. of a Trustee. The death,
declination to serve, resignation, retirement, removal or incapacity of one or
more Trustees, or all of them, shall not operate to annul the Trust or to revoke
any existing agency created pursuant to the terms of this Declaration of Trust.
Whenever there shall be fewer than the designated number of Trustees, until
additional Trustees are elected or appointed as provided herein to bring the
total number of Trustees equal to the designated number, the Trustees in office,
regardless of their number, shall have all the powers granted to the Trustees
and shall discharge all the duties imposed upon the Trustees by this Declaration
of Trust. As conclusive evidence of such vacancy, a written instrument
certifying the existence of such vacancy may be executed by an officer of the
Trust or by a majority of the Trustees. In the event of the death, declination,
resignation, retirement, removal, or incapacity of all the then Trustees within
a short period of time and without the opportunity for at least one Trustee
being able to appoint additional Trustees to replace those no longer serving,
the Trust's Adviser(s) are empowered to appoint new Trustees subject to the
provisions of the 1940 Act.
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<PAGE>
Section 3. Powers. Subject to the provisions of this Declaration of Trust,
the business of the Trust shall be managed by the Trustees, and the Trustees
shall have all powers necessary or convenient to carry out that responsibility
including the power to engage in transactions of all kinds on behalf of the
Trust as described in this Declaration of Trust. Without limiting the foregoing,
the Trustees may: adopt By-Laws not inconsistent with this Declaration of Trust
providing for the management of the affairs of the Trust and may amend and
repeal such By-Laws to the extent that such By-Laws do not reserve that right to
the Unitholders; enlarge or reduce the number of Trustees; remove any Trustee
with or without cause at any time by written instrument signed by at least
two-thirds of the number of Trustees prior to such removal, specifying the date
when such removal shall become effective, and fill vacancies caused by
enlargement of their number or by the death, resignation, retirement or removal
of a Trustee; elect and remove, with or without cause, such officers and appoint
and terminate such agents as they consider appropriate; appoint from their own
number and establish and terminate one or more committees, consisting of two or
more Trustees, that may exercise the powers and authority of the Board of
Trustees to the extent that the Trustees so determine; employ one or more
custodians of the assets of the Trust and may authorize such custodians to
employ sub-custodians and to deposit all or any part of such assets in a system
or systems for the central handling of securities or with a Federal Reserve
Bank; employ an administrator for the Trust and may authorize such administrator
to employ sub-administrators; employ an investment adviser or investment
advisers to the Trust and may authorize such Advisers to employ sub-advisers;
retain a transfer agent or a shareholder servicing agent, or both; provide for
the issuance and distribution of Units by the Trust directly or through one or
more Principal Underwriters or otherwise; redeem, repurchase and transfer Units
pursuant to applicable law; set record dates for the determination of
Unitholders with respect to various matters; declare and pay dividends and
distributions to Unitholders of each Series from the assets of such Series; and
in general delegate such authority as they consider desirable to any officer of
the Trust, to any committee of the Trustees and to any agent or employee of the
Trust or to any such custodian, transfer or shareholder servicing agent, or
Principal Underwriter. 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. Unless otherwise specified herein or in the
By-Laws or required by law, any action by the Trustees shall be deemed effective
if approved or taken by a majority of the Trustees present at a meeting of
Trustees at which a quorum of Trustees is present, within or without the State
of Delaware.
Without limiting the foregoing, the Trustees shall have the power and
authority to cause the Trust (or to act on behalf of the Trust):
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<PAGE>
(a) To invest and reinvest cash, to hold cash uninvested, and to subscribe
for, invest in, reinvest in, purchase or otherwise acquire, own, hold, pledge,
sell, assign, transfer, exchange, distribute, write options on, lend or
otherwise deal in or dispose of contracts for the future acquisition or delivery
of fixed income or other securities, and securities of every nature and kind,
including, without limitation, all types of bonds, debentures, stocks,
negotiable or non-negotiable instruments, obligations, evidences of
indebtedness, certificates of deposit or indebtedness, commercial papers,
repurchase agreements, bankers' acceptances, and other securities of any kind,
issued, created, guaranteed, or sponsored by any and all Persons, including
without limitation, states, territories, and possessions of the United States
and the District of Columbia and any political subdivision, agency, or
instrumentality thereof, any foreign government or any political subdivision of
the United States Government or any foreign government, or any international
instrumentality, or by any bank or savings institution, or by any corporation or
organization organized under the laws of the United States or of any state,
territory, or possession thereof, or by any corporation or organization
organized under any foreign law, or in "when issued" contracts for any such
securities, to change the investments of the assets of the Trust; and to
exercise any and all rights, powers, and privileges of ownership or interest in
respect of any and all such investments of every kind and description,
including, without limitation, the right to consent and otherwise act with
respect thereto, with power to designate one or more Persons to exercise any of
said rights, powers, and privileges in respect of any of said instruments;
(b) To sell, exchange, lend, pledge, mortgage, hypothecate, lease, or write
options (including, options on futures contracts) with respect to or otherwise
deal in any property rights relating to any or all of the assets of the Trust or
any Series;
(c) To vote or give assent, or exercise any rights of ownership, with
respect to stock or other securities or property; and to execute and deliver
proxies or powers of attorney to such Person or Persons as the Trustees shall
deem proper, granting to such Person or Persons such power and discretion with
relation to securities or property as the Trustees shall deem proper;
(d) To exercise powers and rights of subscription or otherwise which in any
manner arise out of ownership of securities;
(e) To hold any security or property in a form not indicating any trust,
whether in bearer, unregistered or other negotiable form, or in its own name or
in the name of a custodian or sub-custodian or a nominee or nominees or
otherwise;
(f) To consent to or participate in any plan for the reorganization,
consolidation or merger of any corporation or issuer of any security which is
held in the Trust; 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 held in the Trust;
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<PAGE>
(g) To join with other security holders 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
proper, 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;
(h) To compromise, arbitrate or otherwise adjust claims in favor of or
against the Trust or any matter in controversy, including, but not limited to,
claims for taxes;
(i) To enter into joint ventures, general or limited partnerships and any
other combinations or associations;
(j) To borrow funds or other property in the name of the Trust exclusively
for Trust purposes and in connection therewith to issue notes or other evidences
of indebtedness; and to mortgage and pledge the Trust Property or any part
thereof to secure any or all of such indebtedness;
(k) 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 of such obligations;
(l) To purchase and pay for entirely out of Trust Property such
insurance as the Trustees may deem necessary or appropriate for the conduct
of the business, including, without limitation, insurance policies insuring
the assets of the Trust or payment of distributions and principal on its
portfolio investments, and insurance polices insuring the Unitholders,
Trustees, officers, employees, agents, investment advisers, principal
underwriters, or independent contractors of the Trust, individually against
all claims and liabilities of every nature arising by reason of holding,
being or having held any such office or position, or by reason of any action
alleged to have been taken or omitted by any such Person as Trustee, officer,
employee, agent, investment adviser, principal underwriter, or independent
contractor, including any action taken or omitted that may be determined to
constitute negligence, whether or not the Trust would have the power to
indemnify such Person against liability;
(m) To adopt, establish and carry out pension, profit-sharing, share
bonus, share purchase, savings, thrift and other retirement, incentive and
benefit plans and trusts, including the purchasing of life insurance and
annuity contracts as a means of providing such retirement and other benefits,
for any or all of the Trustees, officers, employees and agents of the Trust;
(n) To operate as and carry out the business of an investment company, and
exercise all the powers necessary or appropriate to the conduct of such
operations;
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(o) To enter into contracts of any kind and description;
(p) To employ as custodian of any assets of the Trust one or more banks,
trust companies or companies that are members of a national securities exchange
or such other entities as the Commission may permit as custodians of the Trust,
subject to any conditions set forth in this Declaration of Trust or in the
By-Laws;
(q) To employ auditors, counsel or other agents of the Trust, subject to
any conditions set forth in this Declaration of Trust or in the By-Laws;
(r) To interpret the investment policies, practices, or limitations of any
Series or Class;
(s) To establish separate and distinct Series with separately defined
investment objectives and policies and distinct investment purposes, and with
separate Units representing beneficial interests in such Series, and to
establish separate Classes, all in accordance with the provisions of Article
III;
(t) To the full extent permitted by the Delaware Act, to allocate assets,
liabilities and expenses of the Trust to a particular Series and Class or to
apportion the same between or among two or more Series or Classes, provided that
any liabilities or expenses incurred by a particular Series or Class shall be
payable solely out of the assets belonging to that Series or Class as provided
for in Article III;
(u) To invest all of the assets of the Trust, or any Series or any Class
thereof in a single investment company;
(v) Subject to the 1940 Act, to engage in any other lawful act or activity
in which a business trust organized under the Delaware Act may engage.
The Trust shall not be limited to investing in obligations maturing before
the possible termination of the Trust or one or more of its Series. The Trust
shall not in any way be bound or limited by any present or future law or custom
in regard to investment by fiduciaries. The Trust shall not be required to
obtain any court order to deal with any assets of the Trust or take any other
action hereunder.
Section 4. Payment of Expenses by the Trust. The Trustees are authorized to
pay or cause to be paid out of the principal or income of the Trust, or partly
out of the principal and partly out of income, as they deem fair, all expenses,
fees, charges, taxes and liabilities incurred or arising in connection with 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, Advisers, Principal Underwriter, auditors,
counsel, custodian, transfer agent, shareholder servicing agent, and such other
agents or independent contractors and such other expenses and charges as the
Trustees may deem necessary or proper to incur, which expenses, fees, charges,
taxes and liabilities shall be allocated in accordance with Article III,
Section 6 hereof.
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Section 5. Payment of Expenses by Unitholders. The Trustees shall have the
power, as frequently as they may determine, to cause each Unitholder, or each
Unitholder of any particular Series, to pay directly, in advance or arrears,
expenses of the Trust as described in Section 4 of this Article IV ("Expenses"),
in an amount fixed from time to time by the Trustees, by setting off such
Expenses due from such Unitholder from declared but unpaid dividends owed such
Unitholder and/or by reducing the number of Units in the account of such
Unitholder by that number of full and/or fractional Units which represents the
outstanding amount of such Expenses due from such Unitholder, provided that the
direct payment of such Expenses by Unitholders is permitted under applicable
law.
Section 6. Ownership of Assets of the Trust. Title to all of the assets of
the Trust shall at all times be considered as vested in the Trust, 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 in the name of any other Person as nominee, on such terms as the
Trustees may determine. 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 resignation, removal or death of a Trustee, he or she 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.
Section 7. Service Contracts.
(a) Subject to such requirements and restrictions as may be set forth under
federal and/or state law and in the By-Laws, including, without limitation, the
requirements of Section 15 of the 1940 Act, the Trustees may, at any time and
from time to time, contract for exclusive or nonexclusive advisory, management
and/or administrative services for the Trust or for any Series (or Class
thereof) with any Person and any such contract may contain such other terms as
the Trustees may determine, including, without limitation, authority for the
Adviser(s) or administrator to delegate certain or all of its duties under such
contracts to other qualified investment advisers and administrators and to
determine from time to time without prior consultation with the Trustees what
investments shall be purchased, held, sold or exchanged and what portion, if
any, of the assets of the Trust shall be held uninvested and to make changes in
the Trust's investments, or such other activities as may specifically be
delegated to such party.
(b) The Trustees may also, at any time and from time to time, contract with
any Person, appointing such Person exclusive or nonexclusive distributor or
Principal Underwriter for the Units of one or more of the Series (or Classes) or
other securities to be issued by the Trust.
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(c) The Trustees are also empowered, at any time and from time to time, to
contract with any Person, appointing such Person or Persons the custodian,
transfer agent and/or shareholder servicing agent for the Trust or one or more
of its Series.
(d) The Trustees are further empowered, at any time and from time to time,
to contract with any Person to provide such other services to the Trust or one
or more of the Series, as the Trustees determine to be in the best interests of
the Trust and the applicable Series.
(e) The fact that:
(i) any of the Unitholders, Trustees, or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, Adviser, Principal
Underwriter, distributor, or affiliate or agent of or for any Person, or for any
parent or affiliate of any Person with which an advisory, management, or
administration contract, or Principal Underwriter's or distributor's contract,
or transfer agent, shareholder servicing agent or other type of service contract
may have been or may hereafter be made, or that any such organization, or any
parent or affiliate thereof, is a Unitholder or has an interest in the Trust; or
that
(ii) any Person with which an advisory, management, or administration
contract or Principal Underwriter's or distributor's contract, or transfer agent
or shareholder servicing agent contract may have been or may hereafter be made
also has an advisory, management, or administration contract, or Principal
Underwriter's or distributor's or other service contract with one or more other
Persons, or has other business or interests, shall not affect the validity of
any such contract or disqualify any Unitholder, Trustee or officer of the Trust
from voting upon or executing the same, or create any liability or
accountability to the Trust or its Unitholders.
Section 8. Trustees and Officers as Unitholders. Any Trustee, officer or
agent of the Trust may acquire, own and dispose of Units to the same extent as
if he or she were not a Trustee, officer or agent; and the Trustees may issue
and sell and cause to be issued and sold Units to, and redeem such Units from,
any such Person or any firm or company in which such Person is interested,
subject only to the general limitations contained herein or in the By-Laws
relating to the sale and redemption of such Units.
Section 9. Compensation. The Trustees in such capacity shall be entitled to
reasonable compensation from the Trust and they may fix the amount of such
compensation. Nothing herein shall in any way prevent the employment of any
Trustee for advisory, management, legal, accounting, investment banking or other
services and payment for such services by the Trust.
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ARTICLE V
Unitholders' Voting Powers and Meetings
Section 1. Voting Powers. Meetings. Notice. and Record Dates. The
Unitholders shall have power to vote only: (i) for the election or removal of
Trustees as provided in Article IV, Section 1 hereof, and (ii) with respect to
such additional matters relating to the Trust as may be required by applicable
law, this Declaration of Trust, the By-Laws or any registration statement of the
Trust with the Commission (or any successor agency) or as the Trustees may
consider necessary or desirable. Unitholders shall be entitled to one vote for
each Unit held, and a fractional vote for each fraction of a Unit held, as to
any matter on which the Unit is entitled to vote. Notwithstanding any other
provision of this Declaration of Trust, on any matters submitted to a vote of
the Unitholders, all Units of the Trust then entitled to vote shall be voted in
aggregate, except: (i) when required by the 1940 Act, Units shall be voted by
individual Series; (ii) when the matter involves any action that the Trustees
have determined will affect only the interests of one or more Series, then only
Unitholders of such Series shall be entitled to vote thereon; and (iii) when the
matter involves any action that the Trustees have determined will affect only
the interests of one or more Classes, then only the Unitholders of such Class or
Classes shall be entitled to vote thereon. There shall be no cumulative voting
in the election of Trustees. Units may be voted in person or by proxy. A proxy
may be given in writing. The By-Laws may provide that proxies may also, or may
instead, be given by an electronic or telecommunications device or in any other
manner. Until Units are issued, the Trustees may exercise all rights of
Unitholders and may take any action required by law, this Declaration of Trust
or the By-Laws to be taken by the Unitholders. Meetings of the Unitholders shall
be called and notice thereof and record dates therefor shall be given and set as
provided in the By-Laws.
Section 2. Quorum and Required Vote. Except when a larger quorum is
required by applicable law, by the By-Laws or by this Declaration of Trust,
twenty-five percent (25%) of the Units issued and outstanding shall
constitute a quorum at a Unitholders' meeting but any lesser number shall be
sufficient for adjourned sessions. When any one or more Series (or Classes)
is to vote as a single Series (or Class) separate from any other Units,
twenty-five percent (25%) of the Units of each such Series (or Class) issued
and outstanding shall constitute a quorum at a Unitholders' meeting of that
Series (or Class). Except when a larger vote is required by any provision of
this Declaration of Trust or the By-Laws or by applicable law, when a quorum
is present at any meeting, a majority of the Units voted shall decide any
questions and a plurality of the Units voted shall elect a Trustee, provided
that where any provision of law or of this Declaration of Trust requires that
the holders of any Series shall vote as a Series (or that holders of a Class
shall vote as a Class), then a majority of the Units of that Series (or
Class) voted on the matter (or a plurality with respect to the election of a
Trustee) shall decide that matter insofar as that Series (or Class) is
concerned.
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Section 3. Record Dates. For the purpose of determining the Unitholders of
any Series (or Class) who are entitled to receive payment of any dividend or of
any other distribution, the Trustees may from time to time fix a date, which
shall be before the date for the payment of such dividend or such other payment,
as the record date for determining the Unitholders of such Series (or Class)
having the right to receive such dividend or distribution. Without fixing a
record date, the Trustees may for distribution purposes close the register or
transfer books for one or more Series (or Classes) at any time prior to the
payment of a distribution. Nothing in this Section shall be construed as
precluding the Trustees from setting different record dates for different Series
(or Classes).
Section 4. Additional Provisions. The By-Laws may include further
provisions for Unitholders' votes and meetings and related matters.
ARTICLE VI
Net Asset Value, Distributions and Redemptions
Section 1. Determination of Net Asset Value, Net Income and Distributions.
Subject to applicable law and Article III, Section 6 hereof, the Trustees, in
their absolute discretion, may prescribe and shall set forth in the By-Laws or
in a duly adopted vote of the Trustees such bases and time for determining the
per Unit or net asset value of the Units of any Series or Class or net income
attributable to the Units of any Series or Class, or the declaration and payment
of dividends and distributions on the Units of any Series or Class, as they may
deem necessary or desirable.
Section 2. Redemptions and Repurchases.
(a) The Trust shall purchase such Units as are offered by any Unitholder
for redemption, upon the presentation of a proper instrument of transfer
together with a request directed to the Trust, or a Person designated by the
Trust, that the Trust purchase such Units or in accordance with such other
procedures for redemption as the Trustees may from time to time authorize;
and the Trust will pay therefor the net asset value thereof as determined by
the Trustees (or on their behalf), in accordance with any applicable
provisions of the By-Laws, any registration statement of the Trust and
applicable law. Unless extraordinary circumstances exist, payment for said
Units shall be made by the Trust to the Unitholder in accordance with the
1940 Act and any rules and regulations thereunder or as otherwise required by
the Commission. The obligation set forth in this Section 2(a) is subject to
the provision that, during any emergency which makes it impracticable for the
Trust to dispose of the investments of the applicable Series or to determine
fairly the value of the net assets held with respect to such Series, such
obligation may be suspended or postponed by the Trustees. In the case of a
suspension of the right of redemption as provided herein, a Unitholder may
either withdraw the request for redemption or receive payment based on the
net asset value per share next determined after the termination of such
suspension.
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(b) The redemption price may in any case or cases be paid wholly or partly
in kind if the Trustees determine that such payment is advisable in the interest
of the remaining Unitholders of the Series or Class thereof for which the Units
are being redeemed. Subject to the foregoing, the fair value, selection and
quantity of securities or other property so paid or delivered as all or part of
the redemption price may be determined by or under authority of the Trustees. In
no case shall the Trust be liable for any delay of any Adviser or other Person
in transferring securities selected for delivery as all or part of any
payment-in-kind.
(c) If the Trustees shall, at any time and in good faith, determine that
direct or indirect ownership of Units of any Series or Class thereof has or may
become concentrated in any Person to an extent that would disqualify any Series
as a regulated investment company under the Internal Revenue Code of 1986, as
amended (or any successor statute thereof), then the Trustees shall have the
power (but not the obligation) by such means as they deem equitable (i) to call
for the redemption by any such Person of a number, or principal amount, of Units
sufficient to maintain or bring the direct or indirect ownership of Units into
conformity with the requirements for such qualification, (ii) to refuse to
transfer or issue Units of any Series or Class thereof to such Person whose
acquisition of the Units in question would result in such disqualification, or
(iii) to take such other actions as they deem necessary and appropriate to avoid
such disqualification. Any such redemption shall be effected at the redemption
price and in the manner provided in this Article VI.
(d) The holders of Units shall upon demand disclose to the Trustees in
writing such information with respect to direct and indirect ownership of Units
as the Trustees deem necessary to comply with the provisions of the Internal
Revenue Code of 1986, as amended (or any successor statute thereto), or to
comply with the requirements of any other taxing authority.
ARTICLE VII
Limitation of Liability; Indemnification
Section 1. Trustees, Unitholders, etc. Not Personally Liable; Notice. The
Trustees, officers, employees and agents of the Trust, in incurring any debts,
liabilities or obligations, or in taking or omitting any other actions for or in
connection with the Trust, are or shall be deemed to be acting as Trustees,
officers, employees or agents of the Trust and not in their own capacities. No
Unitholder 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 Series, and subject to Section 4 of
this Article VII, 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 connection with the assets or affairs of the
Trust or of any Series, save only that arising from his or her own willful
misfeasance, bad faith, gross
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negligence or reckless disregard of the duties involved in the conduct of his or
her office or the discharge of his or her functions. The Trust (or if the matter
relates only to a particular Series, that Series) 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 Series in
tort, contract or otherwise in connection with the assets or the affairs of the
Trust or such Series, and all Persons dealing with the Trust or any Series shall
be deemed to have agreed that resort shall be had solely to the Trust Property
of the Trust (or if the matter relates only to a particular Series, that of such
Series), for the payment or performance thereof.
The Trustees may provide 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 a Certificate of Trust in respect of the Trust is
on file with the Secretary of State of the State of Delaware and may 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 any instrument made or issued by the Trustees or by any
officer of officers of the Trust are not binding upon any of them or the
Unitholders individually but are binding only upon the assets and property of
the Trust, or the particular Series in question, as the case may be. The
omission of any statement to such effect from such instrument shall not operate
to bind any Trustees or Trustee or officers or officer or Unitholders or
Unitholder individually, or to subject the assets of any Series to the
obligations of any other Series.
Section 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 4 of this Article VII, a
Trustee shall be liable for his or her 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, Adviser, 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
responsible employee of a contracting party employed by the Trust. The Trustees
as such shall not be required to give any bond or surety or any other security
for the performance of their duties.
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Section 3. Indemnification of Unitholders. If any Unitholder (or former
Unitholder) 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 Unitholder and not because of such Unitholder's acts or omissions or for
some other reason, the Trust (upon proper and timely request by the Unitholder)
may assume the defense against such charge and satisfy any judgment thereon or
may reimburse the Unitholders for expenses, and the Unitholder or former
Unitholder (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 Series of which such Unitholder or former Unitholder is or was the
holder of Units) to be held harmless from and indemnified against all loss and
expense arising from such liability.
Section 4. Indemnification of Trustees, Officers, etc. Subject to the
limitations, if applicable, hereinafter set forth in this Section 4, the Trust
shall indemnify (from the assets of one or more Series to which the conduct in
question relates) each of its Trustees, officers, employees and agents
(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 Persons") 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;
and (iii) for a criminal proceeding, had reasonable cause to believe that his or
her conduct was unlawful (the conduct described in (i), (ii) and (iii) 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 or 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
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not liable by reason of Disabling Conduct by (a) a vote of a majority of a
quorum of the Trustees who are neither "interested persons" of the Trust as
defined in the 1940 Act nor parties to the proceeding (the "Disinterested
Trustees"), 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 one or more Series 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 Series if it is ultimately
determined that indemnification of such expenses is not authorized under this
Article VII 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 5. Compromise Payment. As to any matter disposed of by a compromise
payment by any such Covered Person referred to in Section 4 of this Article VII,
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 Person 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
Unitholders by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the Covered Person's
office.
Section 6. Indemnification Not Exclusive, etc. The right of indemnification
provided by this Article VII shall not be exclusive of or affect any other
rights to which any such Covered Person or shareholder may be entitled. As used
in this Article VII, 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 VII 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.
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Section 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.
Section 8. Insurance. The Trustees shall be entitled and empowered to the
fullest extent permitted by law to purchase with Trust assets insurance for
liability and for all expenses reasonably incurred or paid or expected to be
paid by a Trustee, officer, employee, or agent of the Trust in connection with
any claim, action, suit, or proceeding in which he or she may become involved by
virtue of his or her capacity or former capacity as a Trustee of the Trust.
ARTICLE VIII
Miscellaneous
Section 1. Termination of the Trust or Any Series or Class.
(a) Unless terminated as provided herein, the Trust shall continue without
limitation of time. The Trustees in their sole discretion may terminate the
Trust.
(b) Upon the requisite action by the Trustees to terminate the Trust or any
one or more Series of Units or any Class thereof, after paying or otherwise
providing for all charges, taxes, expenses, and liabilities, whether due or
accrued or anticipated, of the Trust or of the particular Series or any Class
thereof as may be determined by the Trustees, the Trust shall in accordance with
such procedures as the Trustees may consider appropriate reduce the remaining
assets of the Trust or of the affected Series or Class to distributable form in
cash or Units (if any Series remain) or other securities, or any combination
thereof, and distribute the proceeds to the Unitholders of the Series or Classes
involved, ratably according to the number of Units of such Series or Class held
by the Unitholders of such Series or Class on the date of distribution.
Thereupon, the Trust or any affected Series or Class shall terminate and the
Trustees and the Trust shall be discharged from any and all further liabilities
and duties relating thereto or arising therefrom, and the right, title, and
interest of all parties with respect to the Trust or such Series or Class shall
be canceled and discharged.
(c) Upon termination of the Trust, following completion of winding up of
its business, the Trustees shall cause a certificate of cancellation of the
Trust's Certificate of Trust to be filed in accordance with the Delaware Act,
which certificate of cancellation may be signed by any one Trustee.
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Section 2. Reorganization.
(a) Notwithstanding anything else herein, the Trustees may, without
Shareholder approval unless such approval is required by applicable law, (i)
cause the Trust to merge or consolidate with or into or transfer its assets and
any liabilities to one or more trusts (or series thereof to the extent permitted
by law), partnerships, associations, corporations or other business entities
(including trusts, partnerships, associations, corporations or other business
entities created by the Trustees to accomplish such merger or consolidation or
transfer of assets and any liabilities) so long as the surviving or resulting
entity is an investment company as defined in the 1940 Act, or is a series
thereof, that will succeed to or assume the Trust's registration under the 1940
Act and that is formed, organized, or existing under the laws of the United
States or of a state, commonwealth, possession or colony of the United States,
unless otherwise permitted under the 1940 Act, (ii) cause any one or more Series
(or Classes) of the Trust to merge or consolidate with or into or transfer its
assets and any liabilities to any one or more other Series (or Classes) of the
Trust, one or more trusts (or series or classes thereof to the extent permitted
by law), partnerships, associations, corporations, (iii) cause the Units to be
exchanged under or pursuant to any state or federal statute to the extent
permitted by law or (iv) cause the Trust to reorganize as a corporation, limited
liability company or limited liability partnership under the laws of Delaware or
any other state or jurisdiction.
(b) Pursuant to and in accordance with the provisions of Section 3815(f) of
the Delaware Act, and notwithstanding anything to the contrary contained in this
Declaration of Trust, an agreement of merger or consolidation or exchange or
transfer of assets and liabilities approved by the Trustees in accordance with
this Section 2 may (i) effect any amendment to the governing instrument of the
Trust or (ii) effect the adoption of a new governing instrument of the Trust if
the Trust is the surviving or resulting trust in the merger or consolidation.
(c) The Trustees may create one or more business trusts to which all or any
part of the assets, liabilities, profits, or losses of the Trust or any Series
or Class thereof may be transferred and may provide for the conversion of Units
in the Trust or any Series or Class thereof into beneficial interests in any
such newly created trust or trusts or any series or classes thereof.
-22-
C-32
<PAGE>
Section 3. Amendments. Except as specifically provided in this Section
3, the Trustees may, without Unitholder vote, restate, amend, or otherwise
supplement this Declaration of Trust. Unitholders shall have the right to
vote on (i) any amendment that would affect their right to vote granted in
Article V, Section 1 hereof, (ii) any amendment to this Section 3 of Article
VIII; (iii) any amendment that may require their vote under applicable law or
by the Trust's registration statement, as filed with the Commission, and (iv)
any amendment submitted to them for their vote by the Trustees. Any amendment
required or permitted to be submitted to the Unitholders that, as the
Trustees determine, shall affect the Unitholders of one or more Series shall
be authorized by a vote of the Unitholders of each Series affected and no
vote of Unitholders of a Series not affected shall be required.
Notwithstanding anything else herein, no amendment hereof shall limit the
rights to insurance provided by Article VII hereof with respect to any acts
or omissions of Persons covered thereby prior to such amendment nor shall any
such amendment limit the rights to indemnification referenced in Article VII
hereof as provided in the By-Laws with respect to any actions or omissions of
Persons covered thereby prior to such amendment. The Trustees may, without
Unitholder vote, restate, amend, or otherwise supplement the Certificate of
Trust as they deem necessary or desirable.
Section 4. Filing of Copies; References; Headings. The original or a
copy of this instrument and of each restatement and/or amendment hereto shall
be kept at the office of the Trust where it may be inspected by any
Unitholder. Anyone dealing with the Trust may rely on a certificate by an
officer of the Trust as to whether or not any such restatements and/or
amendments have been made and as to any matters in connection with the Trust
hereunder; and, with the same effect as if it were the original, may rely on
a copy certified by an officer of the Trust to be a copy of this instrument
or of any such restatements and/or amendments. In this instrument and in any
such restatements and/or amendments, references to this instrument, and all
expressions such as "herein," "hereof," and "hereunder," shall be deemed to
refer to this instrument as amended or affected by any such restatements
and/or amendments. Headings are placed herein for convenience of reference
only and shall not be taken as a part hereof or control or affect the
meaning, construction or effect of this instrument. Whenever the singular
number is used herein, the same shall include the plural; and the neuter,
masculine and feminine genders shall include each other, as applicable. This
instrument may be executed in any number of counterparts each of which shall
be deemed an original.
Section 5. Applicable Law.
(a) The Trust is created under, and this Declaration of Trust is to be
governed by, and construed and enforced in accordance with, the laws of
the State of Delaware. The Trust shall be of the type commonly called a
business trust, and without limiting the provisions hereof, the Trust
specifically reserves the right to exercise any of the powers or
privileges afforded to business trusts or actions that may be engaged
in by business trusts under the Delaware Act, and the absence of a
specific reference herein to any such power, privilege, or action shall
not imply that the Trust may not exercise such power or privilege or
take such actions.
-23-
C-33
<PAGE>
(b) Notwithstanding the first sentence of Section 5(a) of this Article
VIII, there shall not be applicable to the Trust, the Trustees, or this
Declaration of Trust either the provisions of Section 3540 of Title 12 of the
Delaware Code or any provisions of the laws (statutory or common) of the
State of Delaware (other than the Delaware Act) pertaining to trusts that
relate to or regulate: (i) the filing with any court or governmental body or
agency of Trustee accounts or schedules of trustee fees and charges; (ii)
affirmative requirements to post bonds for trustees, officers, agents, or
employees of a trust; (iii) the necessity for obtaining a court or other
governmental approval concerning the acquisition, holding, or disposition of
real or personal property; (iv) fees or other sums applicable to trustees,
officers, agents or employees of a trust; (v) the allocation of receipts and
expenditures to income or principal; (vi) restrictions or limitations on the
permissible nature, amount, or concentration of trust investments or
requirements relating to the titling, storage, or other manner of holding of
trust assets; or (vii) the establishment of fiduciary or other standards or
responsibilities or limitations on the acts or powers or liabilities or
authorities and powers of trustees that are inconsistent with the limitations
or liabilities or authorities and powers of the Trustees set forth or
referenced in this Declaration of Trust; or (viii) activities similar to
those referenced in the foregoing items (i) through (vii).
Section 6. Provisions in Conflict with Law or Regulations.
(a) The provisions of this Declaration of Trust are severable, and if
the Trustees shall determine, with the advice of counsel, that any such
provision is in conflict with the 1940 Act, the regulated investment company
provisions of the Internal Revenue Code of 1986, as amended (or any successor
statute thereto), and the regulations thereunder, the Delaware Act or with
other applicable laws and regulations, the conflicting provision shall be
deemed never to have constituted a part of this Declaration of Trust;
provided, however, that such decision shall not affect any of the remaining
provisions of this Declaration of Trust or render invalid or improper any
action taken or omitted prior to such determination.
(b) If any provision of this Declaration of Trust shall be held invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability
shall attach only to such provision in such jurisdiction and shall, not in
any MANNER affect such provision in any other jurisdiction or any other
provision of this Declaration of Trust in any jurisdiction.
Section 7. Business Trust Only. It is the intention of the Trustees to
create a business trust pursuant to the Delaware Act. It is not the intention
of the Trustees to create a general partnership, limited partnership, joint
stock association, corporation, bailment, or any form of legal relationship
other than a business trust pursuant to the Delaware Act. Nothing in this
Declaration of Trust shall be construed to make the Unitholders, either by
themselves or with the Trustees, partners, or members of a joint stock
association.
-24-
C-34
<PAGE>
IN WITNESS WHEREOF, the Trustees named below do hereby make and enter into
this Agreement and Declaration of Trust as of the 22nd day of April, 1998.
/s/ Richard A. DeWitt /s/ James J. Rosloniec
/s/ Richard A. DeWitt /s/ James J. Rosloniec
- -------------------------------- -------------------------------
Richard A. DeWitt James J. Rosloniec
Trustee and not individually Trustee and not individually
/s/ Allan D. Engel /s/ Walter T. Jones
/s/ Allan D. Engel /s/ Walter T. Jones
- -------------------------------- -------------------------------
Allan D. Engel Walter T. Jones
Trustee and not individually Trustee and not individually
/s/ Donald H. Johnson
/s/ Donald H. Johnson
- --------------------------------
Donald H. Johnson
Trustee and not individually
THE PRINCIPAL PLACE OF BUSINESS
OF THE TRUST IS:
7575 Fulton Street East,
Ada, Michigan 49355
-25-
C-35
<PAGE>
CERTIFICATE NO.
FOR _______________ SHARES
ISSUED TO
__________________________
__________________________
__________________________
DATED __________ 19__
FROM WHOM TRANSFERRED
__________________________
DATED __________ 19__
NO. ORIGINAL NO. ORIGINAL NO. OF SHARES
CERTIFICATE SHARES TRANSFERRED
__________________________
RECEIVED CERTIFICATE NO.
FOR __________ SHARES
THIS ____ DAY OF ____ 19__
__________________________
__________________________
[GRAPHIC] [GRAPHIC] [GRAPHIC]
AMWAY
MUTUAL
Organized as a Business Trust FUND OF THE STATE OF DELAWARE
THIS CERTIFIES THAT ___________________________________________ IS THE OWNER OF
____________________________________________ FULLY PAID AND NON-ASSESSABLE
SHARES OF BENEFICIAL INTEREST OF AMWAY MUTUAL FUND A SERIES OF AMWAY MUTUAL
FUND TRUST TRANFERABLE ON THE BOOKS OF THE TRUST IN PERSON OR BY DULY
AUTHORIZED ATTORNEY UPON SURRENDER OF THIS CERTIFICATE PROPERLY ENDORSED.
IN WITNESS WHEREOF THE SAID TRUST HAS CAUSED THIS CERTIFICATE
TO BE SIGNED BY ITS DULY AUTHORIZED OFFICERS AND SEALED WITH THE
SEAL OF THE AMWAY MUTUAL FUND TRUST
[SEAL] THIS __________________ DAY OF _________________ A.D. 19___
_________________________ ________________________________
SECRETARY VICE PRESIDENT
<PAGE>
ADVISORY AND SERVICE CONTRACT
BETWEEN
AMWAY MUTUAL FUND TRUST
AND
AMWAY MANAGEMENT COMPANY
AGREEMENT made as of the 22nd day of April, 1998, between AMWAY MUTUAL
FUND TRUST, a Delaware business trust (hereinafter called the "Trust"), and
AMWAY MANAGEMENT COMPANY, a Michigan corporation (hereinafter called the
"Adviser");
WITNESSETH:
In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by the parties hereto as follows:
1. DUTIES OF THE ADVISER. The Trust hereby employs the Adviser to
furnish investment advice and manage on a regular basis the investment
portfolio of Amway Mutual Fund (the "Fund"), a series of the Trust, subject
to the direction of the Board of Trustees of the Trust, and to provisions of
the Fund's current Prospectus; to furnish for the use of the Trust, office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Fund and administering its affairs subject
to the provisions of Section 2 herein; and to pay the salaries and fees of
Trustees of the Trust. The Adviser will, from time to time, discuss with the
Trust economic investment developments which may affect the Fund's portfolio
and furnish such information as the Adviser may believe appropriate for this
purpose. The Adviser will maintain such statistical and analytical
information with respect to the Fund's portfolio securities as the Adviser
may believe appropriate, and shall make such materials available for
inspection by the Trust, as may be reasonable. Except when otherwise
specifically directed by the Trust, the Adviser will make investment
decisions on behalf of the Fund and place all orders for the purchase and
sale of portfolio securities for the Fund's account. The Adviser, for all
purposes herein provided, be deemed to be an independent contractor and,
unless otherwise expressly provided or authorized, shall have no authority to
act for or represent the Trust in any way or otherwise be deemed an agent of
the Trust. The Adviser shall be free to render similar services or other
services to others so long as its services hereunder shall not be impaired
thereby. The Adviser shall be permitted to enter into an agreement with
another advisory organization whereby the other organization will provide all
or a part of the investment advice and the services required to manage the
Trust's investment portfolio as provided for in this agreement. Any such
agreement will be subject to approval, as required in Section 5 herein.
2. FEES AND EXPENSES. For the services and facilities to be rendered,
as provided herein, during any fiscal quarter by the Adviser hereunder, the
Trust shall pay the Adviser a fee, payable quarterly, at the annual rate of
0.55% on the first $100 million of average daily net assets of the Fund,
0.50% on the next $50 million in assets, and 0.45% on the next $50 million in
assets. When the Fund's assets reach $200 million, the rate shall be 0.50%
on assets up to $200 million and 0.45% on assets in excess of $200 million,
so long as the Fund continues to have at least $200 million in assets. The
Fund's assets shall be determined as of the close of each business day
throughout the quarter. For the month and year in which this agreement
become effective or terminates, there shall be an appropriate pro-ration on
the basis of the number of days that the agreement is in effect during the
month and year, respectively.
C-37
<PAGE>
It is understood that the Trust will pay all its expenses other than
those expressly stated to be payable by the Adviser hereunder, which expenses
payable by the Trust shall include, without implied limitation, (i)
registration of the Trust under the Investment Company Act of 1940; (ii)
commissions, fees and other expenses connected with the purchase or sale of
securities; (iii) auditing, accounting and legal expenses; (iv) taxes and
interest; (v) governmental fees; (vi) expenses of issue, sale, repurchase and
redemption of shares; (vii) expenses of registering and qualifying the Trust
and its shares under federal and state securities laws and of preparing and
printing prospectuses for such purposes and for distributing the same to
stockholders and investors; (viii) expenses of reports and notices to
stockholders and of meetings of stockholders and proxy solicitations
therefore; (ix) fees and expenses related to the determination of the Trust's
net asset value; (x) insurance expenses; (xi) association membership dues;
(xii) fees, expenses and disbursements of custodians and sub-custodians for
all services to the Trust (including without limitation safekeeping of funds
and securities, and keeping of books and accounts); (xiii) fees, expenses and
disbursement of transfer agents, dividend disbursing agents, stockholder
servicing agents and registrars for all services to the Trust; and (xiv) such
non-recurring items as may arise, including expenses incurred in connection
with litigation, proceedings and claims and the obligation of the Trust to
indemnify its Trustees with respect thereto.
3. MUTUAL INTERESTS. Subject to applicable statutes and regulations,
it is understood that trustees, officers, beneficial shareholders, or agents
of the Trust may be interested in the Adviser as directors, officers,
stockholders, agents, or otherwise; and that the directors, officers,
stockholders, and agents of the Adviser may be interested in the Trust
otherwise than as directors, officers, or agents.
4. LIMITATION OF LIABILITY OF THE ADVISER. The Adviser shall not be
liable for any error of judgment or of law, or for any loss suffered by the
Trust or to any stockholder in connection with the matters to which this
agreement relates, except loss resulting from willful misfeasance, bad faith
or gross negligence on the part of the Adviser in the performance of its
obligations and duties, or by reason of its reckless disregard of its
obligations and duties under this agreement.
5. DURATION AND TERMINATION OF THIS AGREEMENT. This agreement shall
become effective upon execution and shall remain in force for two years,
unless sooner terminated as hereinafter provided and shall continue in force
from year to year thereafter, but only so long as such continuance is
specifically approved, at least annually, by a majority vote of the Trustees
of the Trust, including a majority of the Trustees who are not parties to the
agreement or interested persons of any such party (other than as Trustees of
the Trust) or by a vote of a majority of the Trust's outstanding shares, but
in either case by the disinterested Trustees, in the manner required by the
Investment Company Act of 1940.
This agreement may be terminated by the Trust or by the Adviser at any
time without payment of any penalty by vote of the Trustees of the Trust or
Adviser or by vote of the holders of a majority of the outstanding shares of
the Trust on sixty (60) days' written notice to the other parties hereto.
Termination of this agreement shall not affect the right of the Adviser
to receive payments on any unpaid balance of the compensation described in
Section 2 earned prior to such termination.
If any provision of this agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder shall not be
thereby affected.
C-38
<PAGE>
This agreement shall automatically terminate in the event of its
assignment. The term "assignment" for this purpose has the meaning defined in
Section 2(a)4 of the Investment Company Act of 1940.
6. WRITTEN NOTICE. Any notice under this agreement shall be in
writing addressed and delivered or mailed postage prepaid, to the other
parties at such address as such other parties may designate for the receipt
of such notices.
IN WITNESS WHEREOF, the Trust and the Adviser have caused this agreement
to be signed, as of the day and year first above written.
AMWAY MUTUAL FUND TRUST
By: /s/ James J. Rosloniec
-------------------------------
James J. Rosloniec
President
AMWAY MANAGEMENT COMPANY
By: /s/ Allan D. Engel
-------------------------------
Allan D. Engel
President
C-39
<PAGE>
SUB-ADVISORY AGREEMENT
AGREEMENT made as of the 22nd day of April, 1998 between AMWAY
MANAGEMENT COMPANY, a Michigan corporation having its principal place of
business in Ada, Michigan (hereinafter called "AMC"), and ARK Asset
Management Co., Inc., having its principal place of business in New York, New
York (hereinafter called "ARK");
WHEREAS, AMC is the investment adviser to Amway Mutual Fund (the "Fund")
a series of Amway Mutual Fund Trust (the "Trust"), a Delaware business trust,
an investment company registered under the Investment Company Act of 1940, as
amended (hereinafter called "1940 Act"); and
WHEREAS, AMC wishes to retain ARK to furnish it with investment advice
in connection with AMC's advisory activities on behalf of the Trust and the
Fund, and ARK is willing to furnish such services to AMC.
WITNESSETH:
In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by the parties hereto as follows:
1. AMC hereby employs ARK to furnish investment advice and manage on a
regular basis the investment portfolio of the Fund, subject always to the
direction of AMC, the Board of Trustees of the Trust, and to the provisions
of the Fund's current Prospectus. ARK shall provide administrative
facilities, including bookkeeping, clerical personnel and equipment necessary
for the investment management of the Fund's portfolio of investments
(excluding determination of net asset value and shareholder accounting
services). ARK shall advise and assist AMC and the officers of the Trust in
taking such steps as are necessary or appropriate to carry out the decisions
of the Trust's Board of Trustees, in regard to the foregoing matters and the
supervision of the Fund's investment portfolio.
ARK will, from time to time, discuss with AMC economic and investment
developments which may affect the Fund's portfolio and furnish such
information as ARK may believe appropriate for this purpose. ARK will
maintain such statistical and analytical information with respect to the
Fund's portfolio securities as ARK may believe appropriate and shall make
such material available for inspection by AMC as may be reasonable from time
to time.
Except when otherwise specifically directed by the Trust or AMC, ARK
will make investment decisions on behalf of the Fund and place all orders for
the purchase or sale of portfolio securities for the Fund's account. ARK
agrees that upon request from time to time one of its representatives will
attend as mutually agreed upon meetings of the Board of Trustees or
beneficial shareholders of the Trust in order to make reports on investment
strategy and results. ARK accepts such employment and agrees at its own
expense to render the services and to assume the obligations herein set forth
for the compensation herein provided. ARK shall, for all purposes herein
provided, be deemed to be an independent contractor and, unless otherwise
expressly provided or authorized, shall have no authority to act for or
represent AMC, the Trust, or the Fund in any way or otherwise be deemed an
agent of AMC or the Trust. ARK shall be free to render similar services or
other services to others so long as its services hereunder shall not be
impaired thereby. Likewise, AMC shall be free to utilize other persons to
perform similar or unrelated services.
C-40
<PAGE>
2. For the services to be rendered by ARK, as provided herein, AMC
shall pay to ARK a fee, payable quarterly, at the annual rate of 0.45 on the
first $100 million of average daily net assets of the Fund, 0.40% on the next
$50 million in assets, and 0.35% on the next $50 million in assets. When the
Fund's assets reach $200 million, the rate shall be 0.40% on assets up to
$200 million and 0.35% on assets in excess of $200 million, so long as the
Fund continues to have at least $200 million in assets. The Fund's assets
shall be determined to have as of the close of each business day throughout
the quarter. For the month and year in which the agreement becomes effective
or terminates, there shall be an appropriate proration on the basis of the
number of days that the agreement is in effect during the month and year,
respectively.
3. Subject to applicable statutes and regulations, it is understood
that directors, trustees, officers, stockholders, or agents of AMC or the
Trust may be interested in ARK as officers, directors, agents, shareholders
or otherwise, and that the officers, directors, shareholders and agents of
ARK may be interested in AMC or the Trust otherwise than as a director,
officer or agent.
4. ARK shall not be liable for any error of judgment or of law, or for
any loss suffered by the Trust in connection with the matters to which this
agreement relates, except loss resulting from willful misfeasance, bad faith
or gross negligence on the part of ARK in the performance of its obligations
and duties, or by reason of its reckless disregard of its obligations and
duties under this agreement. ARK shall not be liable for any action
undertaken at AMC's direction.
5. In compliance with the requirements of Rule 31a-3 under the 1940
Act, ARK hereby agrees that all records which it maintains for the Trust, as
specifically agreed upon by ARK and AMC, are the property of the Trust and
further agrees to surrender promptly to the Trust any of such records upon
the Trust's request. ARK further agrees to preserve such records for the
periods prescribed by Rule 31a-2 under the 1940 Act and to make such records
available as requested by regulatory agencies for inspection.
6. This agreement shall become effective upon execution and shall
remain in force for two years, unless sooner terminated as hereinafter
provided and shall continue in force from year to year thereafter, but only
so long as such continuance is specifically approved, at least annually, by a
majority of the Trustees, including a majority of the Trustees who are not
parties to the agreement or interested persons of any such party (other than
as Trustees of the Trust) by a vote of a majority of the Trust's outstanding
shares, but in either case by the disinterested Trustees, in the manner
required by the 1940 Act.
This agreement may be terminated by AMC or by ARK at any time without
the payment of any penalty on sixty (60) day's written notice to the other
party, and may also be terminated at any time without payment of any penalty
by vote of the Board of Trustees of the Trust or by vote of the holders of a
majority of the outstanding shares of the Fund on sixty (60) days' written
notice to the other parties hereto.
Termination of this agreement shall not affect the right of ARK to
receive payments on any unpaid balance of the compensation described in
Section 2 earned prior to such termination.
If any provision of this agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder shall not be
thereby affected.
This agreement shall automatically terminate in the event of its
assignment. The term "assignment" for this purpose has the meaning defined in
Section 2(a)4 of the 1940 Act.
C-41
<PAGE>
7. Any notice under this agreement shall be in writing, addressed and
delivered or mailed, postage prepaid, to the other parties at such address as
such other parties may designate for the receipt of such notices.
IN WITNESS WHEREOF, AMC and ARK have caused this agreement to be
signed, as of the day and year first above written.
AMWAY MANAGEMENT COMPANY
By: /s/ Allan D. Engel
------------------------------
Allan D. Engel
President
ARK ASSET MANAGEMENT CO., INC.
By: /s/ Lauri London
------------------------------
Lauri London
General Counsel
This Agreement is hereby accepted and approved as of this day and year
first above written.
AMWAY MUTUAL FUND TRUST
By: /s/ James J. Rosloniec
------------------------------
James J. Rosloniec
President
C-42
<PAGE>
PRINCIPAL UNDERWRITER AGREEMENT
BETWEEN
AMWAY MUTUAL FUND TRUST
AND
AMWAY MANAGEMENT COMPANY
AGREEMENT made as of the 22nd day of April, 1998, between AMWAY MUTUAL
FUND TRUST, a Delaware business trust (hereinafter called the "TRUST"), and
AMWAY MANAGEMENT COMPANY, a Michigan corporation (hereinafter called the
"Adviser");
In consideration of the mutual promises and undertakings herein contained
the parties hereto agree as follows:
SECTION 1. GENERAL. The Trust hereby grants to Principal Underwriter
the right, during the term of this Agreement and subject to registration
requirements of the Securities Act of 1933 as amended (herein called the
"1933 Act"), to purchase shares of beneficial interest ("Shares") of Amway
Mutual Fund (the "Fund"), a series of the Trust, and to resell such Shares
upon the terms and conditions hereinafter set forth. Principal Underwriter
shall have the right to purchase from the Trust as principal at a price equal
to the net asset value during each period determined as described in the
current prospectus the Shares needed, but no more than the Shares needed
(except for clerical errors and errors of transmission), to fill
unconditional orders for Shares of the Fund received during such period by
Principal Underwriter from dealers or investors. Principal Underwriter shall
resell such Shares purchased at a price equal to the public offering price
determined as described in the current prospectus less, in the case of a sale
to a dealer, the discount allowed the dealer, if any.
The foregoing right granted to Principal Underwriter to purchase Shares
from the Trust shall be exclusive, except that Shares may be issued by the
Trust (a) in connection with any merger or consolidation of the Trust with
any other investment company or trust or any personal holding company or the
acquisition by the fund, by purchase or otherwise, of any other investment
company or trust or any personal holding company or of the assets of any such
entity, (b) in connection with offers of exchange exempted from Section 22(d)
of the Investment Company Act of 1940 by reason of the fact that said offers
are permitted by Section 11 of said Act, (c) in connection with the
reinvestment of any dividends paid or capital gains distributed to
shareholders in additional Shares of the Fund at the net asset value per
share, and (d) for cash at net asset value to depositors, underwriters or
sponsors of unit investment trusts or any similar legal entities which
acquires shares of the Fund.
SECTION 2. PUBLIC OFFERING PRICE; SALES CHARGE. The net asset value and
the public offering price and the decision of whether or not to impose a
sales charge upon a public offering of the shares of the Fund shall be
determined by the Trust. The net asset value and the public offering price
shall be computed in accordance with the Rules of Fair Practice of the
National Association of Securities Dealers, Inc., and the current prospectus
of the Fund and Principal Underwriter shall be notified promptly thereof.
The public offering price (being the price at which Principal Underwriter or
dealers may sell shares to the public) shall be an amount equal to such net
asset
C-43
<PAGE>
value plus a sales charge, if any, varying with the size of the investment as
described in the currently effective offering prospectus of the Fund; and so
long as this Agreement remains in effect the sales charge, if any, and the
method of determining net asset value and the public offering price shall not
be changed without the written consent of Principal Underwriter. The net
asset value and the offering price based thereon shall be subject to
adjustment in the event of wide fluctuations in market prices, subject to the
provisions of the Investment Company Act of 1940 and state laws regulating
the sales of securities, and any regulations of the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc. and state
blue sky commissioners having jurisdiction.
SECTION 3. DEALER AGREEMENTS. If a sales charge is in effect, Principal
Underwriter shall have the right to enter into uniform sales agreements with
dealers of its choice for the sale of Shares of the Fund and fix therein the
portion of the sales charge which may be retained by dealers, provided that
the Trust shall approve the form of the dealer agreement and the dealer
discounts set forth therein and shall evidence such approval by filing said
form of dealer agreement and amendments thereto as an exhibit to its
currently effective registration statement on Form N-1A filed under the 1933
Act.
SECTION 4. PAYMENT AND DELIVERY OF SHARES. Upon receipt by the Trust at
its principal place of business, or by the Custodian of the Trust as such
place as the Custodian shall designate, of a written order from Principal
Underwriter, together with delivery instructions, the Trust shall, as
promptly as practicable, cause certificates for the Shares called for in such
written order to be delivered in such amounts and in such names as shall be
specified by Principal Underwriter, against payment thereof in such manner as
may be acceptable to the Trust, provided that Principal Underwriter shall pay
for such shares as soon as conveniently possible, but in no event later than
the tenth business day following the date on which Principal Underwriter
shall have contracted to purchase the shares.
SECTION 5. TAXES. The Trust shall pay for and affix any stock issue
stamps (or in the case of treasury shares transfer stamps) required for the
issue (or transfer) of Shares sold to Principal Underwriter as principal.
Principal Underwriter shall pay for and affix any stock transfer stamps
required in connection with the sale of Shares by Principal Underwriter as
principal to dealers or to investors.
SECTION 6. INFORMATION; PROSPECTUSES. The Trust shall furnish to
Principal Underwriter copies of all information, financial statements and
other papers which Principal Underwriter may reasonably request for use in
connection with the distribution of Shares of the Fund, and this shall
include, but shall not be limited to, one certified copy, upon request by
Principal Underwriter, of all financial statements prepared for the Fund by
independent public accountants. The Trust shall make available to Principal
Underwriter such number of copies of its currently effective prospectus as
Principal Underwriter shall request.
SECTION 7. INDEMNIFICATION BY FUND. The Trust agrees to indemnify and
hold harmless Principal Underwriter and each person, if any, who controls
Principal Underwriter within the meaning of Section 15 of the 1933 Act
against any loss, liability, claim, damages or expenses (including the
reasonable cost of investigating or defending any alleged loss, liability,
claim, damages, or expense and reasonable counsel fees incurred in connection
therewith), arising by reason of any person acquiring any Shares, which may
be based upon the 1933 Act or on any other statute or at common law, on the
ground that the registration statement or prospectus, as
C-44
<PAGE>
from time to time amended and supplemented, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading, unless
such statement or omission was made in reliance upon, and in conformity with,
information furnished to the Trust in connection therewith by or on behalf of
Principal Underwriter; provided, however, that in no case (i) is the
indemnity of the Trust in favor of Principal Underwriter and any such
controlling person to be deemed to protect Principal Underwriter or any such
controlling person against any liability to the Trust or its securities
holders to which Principal Underwriter or any such controlling person would
otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties under this Agreement, or (ii) is the
Trust to be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against Principal Underwriter or any such
controlling person unless Principal Underwriter or such controlling person,
as the case may be, shall have notified the Trust in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon Principal
Underwriter or such controlling Person (or after Principal Underwriter or
such controlling person shall have received notice of such service on any
designated agent), but failure to notify the Trust of any such claim shall
not relieve it from any liability which it may have to the person against
whom such action is brought otherwise than on account of its indemnity
agreement contained in this paragraph.
The Trust will be entitled to participate at its own expense in the
defense, or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but if the Trust elects to assume the defense,
such defense shall be conducted by counsel chosen by it and satisfactory to
Principal Underwriter or such controlling person or persons, defendant or
defendants in the suit. In the event the Trust elects to assume the defense
of any such suit and retain such counsel, Principal Underwriter or such
controlling person or persons, defendant or defendants in the suit, shall
bear the fees and expenses of any additional counsel retained by them, but,
in case the Trust does not elect to assume the defense of any such suit, it
will reimburse Principal Underwriter or such controlling person or persons,
defendant or defendants in the suit, for the reasonable fees and expenses of
any counsel retained by them. The Trust agrees promptly to notify Principal
Underwriter of the commencement of any litigation or proceedings against it
or any of its officers or directors, employees or agents in connection with
the issuance or sale of any of the Shares.
SECTION 8. INDEMNIFICATION BY PRINCIPAL UNDERWRITER. Principal
Underwriter covenants and agrees that it will indemnify and hold harmless the
Trust and each of its directors, officers, employees or agents and each
person, if any, who controls the Trust within the meaning of Section 15 of
the 1933 Act, against any loss, liability, damages, claim or expense
(including the reasonable cost of investigating or defending any alleged
loss, liability, damages, claim or expense and reasonable counsel fees
incurred in connection therewith) arising by reason of any person acquiring
any Shares, which may be based upon the 1933 Act or any other statute or at
common law, on account of any wrongful act of Principal Underwriter or any of
its employees or on the ground that the registration statement or prospectus,
as from time to time amended, included an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, insofar as any such
statement or omission was made in reliance upon, and in conformity with,
information furnished to the Trust in connection therewith by or on behalf of
Principal Underwriter, provided, however, that in no case (i) is the
indemnity of Principal Underwriter in favor of the Trust or any
C-45
<PAGE>
person indemnified to be deemed to protect the Trust or any such person
against any liability to which the Trust or any such person would otherwise
be subject by reason or willful misfeasance, bad faith, or gross negligence
in the performance of its duties or by reason of its reckless disregard of
its obligations and duties under this Agreement, or (ii) is Principal
Underwriter to be liable under its indemnity agreement contained in this
paragraph with respect to any claim made against the Trust or any person
indemnified unless the Trust or such person, as the case may be, shall have
notified Principal Underwriter in writing within a reasonable time after the
summons or other first legal process giving information of the nature of the
claim shall have been served upon the Trust or upon such person (or after the
Trust or such person shall have received notice of such service on any
designated agent), but failure to notify Principal Underwriter of any such
claim shall not relieve it from any liability which it may have to the Trust
of any person against whom such action if brought otherwise than on account
of its indemnity agreement contained in this paragraph.
In the case of any such notice to Principal Underwriter, it shall be
entitled to participate, at its own expense, in the defense, or , if it so
elects, to assume the defense of any suit brought to enforce any such
liability, but, if Principal Underwriter elects to assume the defense, such
defense shall be conducted by counsel chosen by it and satisfactory to the
Trust, to its officers, directors, employees and agents, and to any
controlling person or persons, defendant or defendants in the suit. In the
event that Principal Underwriter elects to assume the defense of any such
suit and retain such counsel, the Trust or such controlling persons,
defendant or defendants in the suit, shall bear the fees and expenses of any
additional counsel retained by them, but in case Principal Underwriter does
not elect to assume the defense of any such suit, it will reimburse the
Trust, such officers and directors or controlling person or persons,
defendant or defendants in such suit, for the reasonable fees and expenses of
any counsel retained by them. Principal Underwriter agrees promptly to
notify the Trust of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of the shares.
SECTION 9. OTHER ACTIVITIES OF PRINCIPAL UNDERWRITER. Principal
Underwriter agrees to devote reasonable time and effort to effecting sales of
shares of the Fund, but, so long as it does so, nothing herein contained
shall prevent Principal Underwriter from entering into like arrangements with
other investment companies.
SECTION 10. AUTHORIZED INFORMATION; NO AGENCY. Principal Underwriter is
not authorized by the Trust to give any information, or to make any
representations, other than those contained in the registration statement or
prospectus filed with the Securities and Exchange Commission under the 1933
Act, as amended (as said registration statement and prospectus may be amended
from time to time), covering the Shares of the Fund or such sales literature
as may be prepared by or on behalf of the Trust for Principal Underwriter's
use. No person is authorized to act as agent for the Fund in connection with
the offering or sale of Shares of the Fund to the public or otherwise.
SECTION 11. OTHER LIMITATIONS ON PRINCIPAL UNDERWRITER. Principal
Underwriter shall not take any long or short positions in Shares of the Fund
except as permitted by Paragraph 1 hereof, and, so far as it can reasonably
control the situation, Principal Underwriter will prevent any persons
financially interested in Principal Underwriter from taking any long or short
positions in Shares of the Fund. No portfolio securities of the Fund will be
bought or sold by or through Principal Underwriter, nor will Principal
Underwriter participate in brokerage commissions or "spread" in respect of
such transactions.
C-46
<PAGE>
SECTION 12. EXPENSES. Principal Underwriter agrees to bear all expenses
(a) of printing and distributing any prospectuses or reports, prepared for
its use other than (i) the expense of preparing and setting up in type any
prospectuses required under Federal law to be filed with the Securities and
Exchange Commission or (ii) the expense of preparing and setting up in type
and distributing any reports or other communication to Shareholders of the
Fund is their capacity as such, (b) of preparing, printing and distributing
any other literature used by Principal Underwriter or its dealers in
connection with the offering of the Shares for sale to the public, (c) of
advertising in connection with such offering, and (d) of qualification (other
than auditing expenses) of the Shares for the sale in such states as shall be
selected by Principal Underwriter and the fees payable to each such state for
maintaining the qualification therein until Principal Underwriter notifies
the Trust that it does not wish such qualification maintained.
SECTION 13. DISTRIBUTION PLAN. If the Fund adopts a distribution plan
pursuant to Rule 12b-1 under the Investment Company Act of 1940, the
Principal Underwriter shall be entitled to receive, in addition to the
amounts specified in Sections 1 and 2 of this Agreement, such amounts as may
be authorized by the Fund's Board of Directors pursuant to such plan.
SECTION 14. TERMINATION. This Agreement shall be effective upon the
execution thereof, and, unless terminated as hereinafter provided, this
Agreement shall continue in force for two years from the date hereof and
thereafter from year to year, provided such continuance for each successive
year after such two year period is approved in writing by Principal
Underwriter and the Trust at least three months before the beginning of the
year for which this Agreement is to be continued (unless a shorter period is
agreed upon ), and provided, further, that such continuance is specifically
approved by the Trust's Board of Trustees, or by the vote of the holders of a
majority of the outstanding voting securities (as defined in Section 2(a)(4)
of said Act), of the Trust. In addition, and in either event, the contract
and its terms must be approved at least annually by vote of a majority of the
Trustees of the Trust who are not parties to the contract or interested
persons (as defined in Section 2(a)(19) of said Act) of any such party, cast
in person at a meeting called for the purpose of voting on such approve.
This Agreement shall automatically terminate in the event of its
assignment by Principal Underwriter. As used in the preceding sentence, the
word "assignment" shall have the meaning defined in Section 2(a)(4) of the
Investment Company Act of 1940.
In addition to termination by failure to approve continuance, this
Agreement may at any time be terminated by either party hereto upon not less
than six months' previous written notice to the other party.
SECTION 15. NOTICE. Any notice required or permitted to be given
hereunder by either party to the other shall be deemed sufficiently given if
sent by registered or certified mail, postage prepaid, addressed by the party
giving such notice to the other party at the last address furnished by such
other party to the party giving notice, and unless and until changed pursuant
to the foregoing provisions hereof, addressed, if to the Trust, at 7575 East
Fulton Road, Ada, Michigan 49355, and if to Principal Underwriter, at 7575
East Fulton, Road, Ada, Michigan 49355.
C-47
<PAGE>
IN WITNESS WHEREOF, the Trust has caused this instrument to be executed in
its name and behalf, and its corporate seal to be hereunto affixed, by one of
its officers thereunto duly authorized, and Principal Underwriter has caused
this instrument to be executed in its name and behalf, and its corporate seal to
be hereunto affixed, by one of its officers thereunto duly authorized, as of the
day and year first above written.
AMWAY MUTUAL FUND TRUST
By: /s/ James J. Rosloniec
-----------------------------------
James J. Rosloniec, President
AMWAY MANAGEMENT COMPANY
By: /s/ Allan D. Engel
-----------------------------------
Allan D. Engel, President
C-48
<PAGE>
AMENDMENT TO CUSTODIAN AGREEMENT
DATED JULY 26, 1984
THIS AMENDMENT made this 28th day of April, 1998, amending the Custodian
Agreement dated July 26, 1984, by and between Amway Mutual Fund, Inc., a
Delaware corporation, and Michigan National Bank, a national banking association
of Grand Rapids, Michigan as follows:
1. Pursuant to the reorganization of Amway Mutual Fund, Inc. from a
Delaware Corporation to a Delaware Business Trust, the name of the Fund as
referenced in the Custodian Agreement dated July 26, 1984 is amended to read
Amway Mutual Fund Trust.
2. The other terms of the Agreement remain in full force and effect.
MICHIGAN NATIONAL BANK
By:
--------------------------
AMWAY MUTUAL FUND TRUST
By: /s/ James J. Rosloniec
--------------------------
James J. Rosloniec
President
C-49
<PAGE>
TRANSFER AGENCY AND DIVIDEND
DISBURSING AGENCY AGREEMENT
between
AMWAY MUTUAL FUND
and
AMWAY MANAGEMENT COMPANY
AGREEMENT made this 22nd day of April, 1998, between AMWAY MUTUAL FUND
(hereinafter called the "Fund"), a series of Amway Mutual Fund Trust, a Delaware
Business Trust ("the Trust") and AMWAY MANAGEMENT COMPANY, a Michigan
corporation (hereinafter called the "Agent").
In consideration of the mutual promises and undertakings herein contained,
the parties hereto agree as follows:
SECTION 1. STOCK TRANSFER AGENT. The Agent shall be the stock transfer
agent for the Fund and as such shall:
(a) keep the stock transfer books and records of the Fund, including
the names and addresses of all stockholders, the number and date of
issuance of shares and fractional shares held by each stockholder, the
number and date of certificates issued for such shares, the number and
date of cancellation of redeemed shares, and the number and date of
cancellation of each certificate surrendered for cancellation;
(b) be responsible for the issuance and redemption of shares of the
Fund;
(c) effect and record transfers of ownership of shares and changes in
the registration of shares;
(d) cause all stockholder reports and proxies for stockholders'
meetings to be properly addressed and mailed;
(e) tabulate all proxies; and
(f) prepare and mail all required federal, state and other income tax
information to stockholders.
SECTION 2. DIVIDEND DISBURSING AGENT. The Agent shall be the dividend
disbursing agent of the Fund and as such shall, in accordance with stockholders'
instructions, disburse to stockholders the ordinary dividends and capital gains
distributions allocable to their shares or, alternatively, cause such
distributions to be reinvested in additional shares of the Fund for
stockholders.
SECTION 3. STAFF. The Agent shall at all times maintain a staff of
trained personnel for the purpose of performing its obligations under this
Agreement. The Agent assumes no responsibility under this Agreement other than
the services agreed to herein.
SECTION 4. FEES. For the services of the Agent agreed herein to be
rendered, the Fund shall pay to the Agent, quarterly, the fees provided in the
schedule attached hereto as Exhibit A and by this reference made a part hereof.
C-50
<PAGE>
SECTION 5. CONFORMITY TO CORPORATE INSTRUMENTS AND STATUTES. The Agent
agrees that in all matters relating to the services to be performed by it
herein, it will use its best efforts to act in conformity with the terms of the
Certificate of Incorporation, By-Laws, Registration Statements and current
Prospectus of the Fund. Each of the parties agrees that in all matters relating
to the performance of this Agreement, it will use its best efforts to comply
with the requirements of the Investment Company Act of 1940 and all other
applicable laws and regulations. Nothing herein contained shall be deemed to
relieve or deprive the Board of Directors of the Fund of its responsibility for
the conduct of the affairs of the Fund.
SECTION 6. SERVICES TO OTHERS. The Agent shall be free to render
services of this or any other kind to any other person or organization,
including other investment companies, and to engage in any other business or
activity.
SECTION 7. AMENDMENT. This Agreement, including the schedule
attached hereto as Exhibit A, may be amended at any time by mutual written
consent of the parties.
SECTION 8. EFFECTIVE DATE; TERMINATION. This Agreement shall be
effective as of the date of execution, and may be terminated by either party
hereto upon sixty (60) days' written notice to the other, provided that no such
notice of termination given by the Agent to the Fund shall be effective unless
and until a substitute person or entity has been engaged by the Fund to perform
the services required hereunder for the Fund, or the Fund has certified to the
Agent that other arrangements have been made by it to provide such services.
IN WITNESS WHEREOF the parties hereto have caused this instrument to be
signed in their behalf by their respective officers thereunto duly authorized,
and their respective seals to be hereunto affixed, all as of the date first
above written.
AMWAY MUTUAL FUND TRUST
By /s/ James J. Rosloniec
-------------------------------
James J. Rosloniec, President
AMWAY MANAGEMENT COMPANY
By /s/ Allan D. Engel
-------------------------------
Allan D. Engel, President
C-51
<PAGE>
COMMON - RECORDS CONTRACT
between
AMWAY MUTUAL FUND TRUST
and
AMWAY MANAGEMENT COMPANY
THIS AGREEMENT, made as of the 22ND day of APRIL, 1998 by and between
AMWAY MUTUAL FUND TRUST, a Delaware Business Trust, of Ada, Michigan
(hereinafter called the "Fund"), and AMWAY MANAGEMENT COMPANY, a Michigan
corporation, of Ada, Michigan (hereinafter called the "Adviser"), WITNESSETH
as follows:
WHEREAS, it is considered advisable and desirable to avoid the keeping of
certain identical, or nearly identical, accounts, journals, ledgers, files and
other records by or for each of the parties to this Agreement.
Now, therefore, in consideration of the mutual promises and undertakings
herein contained, the parties hereto AGREE as follows:
(1) The Adviser shall keep, or cause to be kept, such accounts,
journals, ledgers, files and other records as it deems appropriate or needed, or
as requested by the Fund, pertaining to any of its undertakings for or on behalf
of the Fund under any of the several contracts or agreements between the Fund
and the Adviser.
(2) Any of such accounts, journals, ledgers, files and other records
so kept by or for the Adviser in accordance with (1) above shall be considered
to be, and are hereby agreed by the parties hereto to be, the separate and legal
records of each of the parties to this Agreement and/or of both of such parties,
as the case may be.
(3) Included in such accounts, journals, ledgers, files and other
records mentioned in (1) and (2) above, but not limited to the following, are
the records pertaining to the stock portfolio of the Fund, and the computation
and use of the daily net asset value per share of the common stock of the Fund,
the customer accounting as to shareholders of the Fund, and any other records
that are required, pertinent, or desired by either of the parties.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed in their behalf by their respective officers thereunto duly authorized,
and their respective seals to be hereunto affixed, all as of the date first
above written.
AMWAY MUTUAL FUND TRUST
/s/ James J. Rosloniec
----------------------------------
James J. Rosloniec, President
AMWAY MANAGEMENT COMPANY
/s/ Allan D. Engel
----------------------------------
Allan D. Engel, President
C-52
<PAGE>
AMENDMENT TO AGREEMENT
PORTFOLIO ACCOUNTING SYSTEM
REMOTE SERVICE AGREEMENT
The undersigned duly authorized officers hereby agree to amend the Portfolio
Accounting and Information System Remote Service Agreement (the "Agreement")
dated April 26, 1982 and amended August 1, 1984 between Amway Mutual Fund, Inc.
(Amway) and DST Securities, Inc. as follows:
Whereas Amway has reorganized from Amway Mutual Fund, Inc., a Michigan
Corporation, to Amway Mutual Fund Trust, a Delaware Business Trust, the
Agreement shall be made between Amway Mutual Fund Trust, ("Amway") a Delaware
Business Trust and DST Securities, Inc. ("DSTS") a Missouri Corporation
Section 6 is modified as follows:
6.01 It is a Delaware Business Trust duly organized under the laws of the
State of Delaware
Section 12 is modified as follows:
12.01 All notices to be given hereunder shall be deemed properly given
if delivered in person or if sent by U.S. mail, first class, postage
prepaid, as follows:
If to DSTS: If to Amway:
DST Securities, Inc. Amway Mutual Fund Trust
127 W. 10th St., 7th Fl. 7575 Fulton Street East
Kansas City, Missouri 64105 Ada, Michigan 49344-7150
Attn: Mr. John T. O'Neal, President
Fax: (816) 435-3747
With a copy of non-operational notices to:
DST Systems, Inc. If to Clearing Broker:
333 W. 11th St., 5th Fl.
Kansas City, Missouri 64105 Shroeder Wertheim & Co.
Attn: Legal Dept. 787 - 7th Avenue
Fax: (816) 435-8630 New York, NY 10019
or to such address as shall have been specified in writing by the party to
whom such notice is given.
C-53
<PAGE>
The Fee Schedule shall be as indicated on the Fee Schedule, EXHIBIT 2,
attached hereto and made a part hereof.
An amended Schedule of Authorized Client Personnel, EXHIBIT 3, is attached
hereto and made a part hereof.
In Witness Whereof, the parties hereto have caused this amendment to be executed
in their name and on their behalf by their duly authorized officers as of the
1st day of May, 1998.
DST SECURITIES, INC.
By:
-------------------------
AMWAY MUTUAL FUND TRUST
By: /s/ Allan D. Engel
-------------------------
Allan D. Engel
Vice President
C-54
<PAGE>
AMWAY MUTUAL FUND TRUST
EXHIBIT 2
FEE SCHEDULE
PORTFOLIO ACCOUNTING SYSTEM
Effective January 1, 1998
REMOTE ACCESS FEES
Processing and Accounting Fee
$2,500 Per Month
Fees are exclusive of terminal equipment and communications line costs.
Fees will be billed and are payable on a monthly basis.
Fees billed will also include any out-of-pocket expenses incurred by DSTS for
services performed at the request of the client.
Any fees not paid within 30 days of the date of the original invoice will be
charged a late payment fee of one-half percent per month until payment of said
fees are received.
C-55
<PAGE>
EXHIBIT 3
SCHEDULE OF AUTHORIZED CLIENT PERSONNEL
The following persons are authorized to furnish oral and written instructions
which may be relied upon as provided in the Agreement attached hereto:
Allan Engel
Kathleen Vogelsang
The listing may be amended or supplemented from time to time by a corporate
action or other document designating the authorized persons, as deemed
appropriate by the client upon receipt by DSTS.
C-56
<PAGE>
April 21, 1998
Amway Mutual Fund Trust
7575 East Fulton Road
Ada, Michigan 49355
Re: 1933 Act Registration Statement
No. 2-39663
Dear Sirs:
In connection with the registration under the Securities Act of 1933 of an
indefinite number of shares of beneficial interest, $1.00 par value per share
(the "Shares"), of Amway Mutual Fund (the "Fund"), which is a series of Amway
Mutual Fund Trust (the "Trust"), I have reviewed the actions taken by the
Trustees of the Trust to organize the Trust and to authorize the issuance and
sale of the Shares. In addition, I have examined the Trust's Certificate of
Trust and Agreement and Declaration of Trust, the above captioned Registration
Statement, certificates of public officials and officers of the Fund, and such
other documents as I have considered necessary for the purposes of this opinion.
Based upon the foregoing, and having regard for legal considerations which
I deem relevant, it is my opinion that the Shares have been duly authorized
and, when issued and paid for as described in the Registration Statement, will
be validly issued, fully paid and non-assessable by the Trust.
Very truly yours,
/s/ John Dougherty
----------------------------
John Dougherty
C-57
<PAGE>
PLAN AND AGREEMENT OF DISTRIBUTION PURSUANT TO RULE 12b-1
PLAN AND AGREEMENT made as of the 22nd day of April, 1998, by and between
AMWAY MUTUAL FUND TRUST, a Delaware business trust (hereinafter the "Trust"),
and AMWAY MANAGEMENT COMPANY, a Michigan corporation (hereinafter the
"Distributor").
WHEREAS, the Trust engages in business as an open-end management
investment company, and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Trust desires to finance the distribution of the shares of
beneficial interest ("shares") of Amway Mutual fund (the "Fund"), a series of
the Trust, together with any additional such classes or series that may
hereafter be offered to the public in accordance with this Plan and Agreement of
Distribution pursuant to Rule 12b-1 under the Act (the "Plan and Agreement");
and
WHEREAS, the Distributor desires to be retained to perform services in
accordance with such Plan and Agreement and on said terms and conditions; and
WHEREAS, this Plan and Agreement has been approved by a vote of the Board
of Trustees of the Trust, including a majority of the Trustees who are not
interested persons of the Trust, as defined in the Act, and who have no direct
or indirect financial interest in the operation of this Plan and Agreement (the
"Disinterested Trustees") cast in person at a meeting called for the purpose of
voting on this Plan and Agreement; and
WHEREAS, this Plan and Agreement has been approved by Amway Mutual Fund,
Inc. as the sole owner of shares of the Fund; and
NOW, THEREFORE, the Trust adopts the Plan set forth herein and the Trust
and the Distributor hereby enter into this Agreement pursuant to the Plan in
accordance with the requirements of Rule 12b-1 under the Act, and provide and
agree as follows:
1. The Plan is defined as those provisions of this document by which the
Trust adopts a Plan pursuant to Rule 12b-1 under the Act and
authorizes payments as described herein. The Agreement is defined as
those provisions of this document by which the Trust retains the
Distributor to provide distribution services as described herein.
The Trust may retain the Plan notwithstanding termination of the
Agreement. The Trust is hereby authorized to utilize the assets of
the Fund to finance certain activities in connection with distribution
of the Fund's shares.
C-58
<PAGE>
2. Subject to the supervision of the Board of Trustees, the Trust hereby
retains the Distributor to promote the distribution of shares of the
Fund by providing services and engaging in activities as specified
herein. The activities and services to be provided by the Distributor
hereunder shall include one or more of the following: (a) the payment
of compensation (including trail commissions and incentive
compensation) to securities dealers, financial institutions and other
organizations, which may include companies affiliated with the
Distributor, that render distribution and administrative services in
connection with the distribution of the shares of the Fund; (b) the
printing and distribution of reports and prospectuses for the use of
potential investors in the Fund; (c) the preparing and distributing of
sales literature; (d) the providing of advertising and engaging in
other promotional activities, including direct mail solicitation, and
television, radio, newspaper and other media advertisements; and
(e) the providing of such other services and activities as may from
time to time be agreed upon by the Distributor and the Trust. Such
reports and prospectuses, sales literature, advertising and
promotional activities and other services and activities may be
prepared Uand/or conducted either by companies affiliated with the
Distributor or by third parties.
3. The Distributor hereby undertakes to use its best efforts to
promote sales of shares of the Fund to investors by engaging in those
activities specified in paragraph (2) above as may be necessary and as
it from time to time believes will best further sales of such shares.
4. The Trust is hereby authorized to expend, out of the Fund's
assets, on a monthly basis, and shall pay to the Distributor a maximum
amount computed at an annual rate of 0.25 of 1% of the average daily
net assets of the Fund during the month. The Trust's Board of
Trustees shall from time to time determine the amounts, within the
foregoing maximum amounts, that the Trust will pay the Distributor
hereunder. No payments will be made by the Trust hereunder after the
date of termination of the Plan and Agreement.
5. To the extent that obligations incurred by the Distributor out of
its own resources to finance any activity primarily intended to result
in the sales of shares of the Fund, pursuant to this Plan and
Agreement or otherwise, may be deemed to constitute the indirect use
of Trust assets, such indirect use of Trust assets is hereby
authorized in addition to, and not in lieu of, any other payments
authorized under this Plan and Agreement.
6. The Distributor shall provide to the Board of Trustees of the Trust,
at least quarterly, a written report of all moneys spent by the
Distributor on the activities and services specified in paragraph (2)
above pursuant to the Plan and Agreement. Upon request, but no less
frequently than annually, the Distributor shall provide to the Board
of Trustees of the Trust such information as may reasonably be
required for it to review the continuing appropriateness of the Plan
and Agreement.
C-59
<PAGE>
7. This Plan and Agreement shall continue in effect until February 9, 1999
unless terminated as provided below. Thereafter, the Plan and
Agreement shall continue in effect from year to year, provided that the
continuance of each is approved at least annually by a vote of the
Board of Trustees of the Trust, including a majority of the
Disinterested Trustees, cast in person at a meeting called for the
purpose of voting on such continuance. The Plan may be terminated at
any time, without penalty, by the vote of a majority of the
Disinterested Trustees or by the vote of a majority of the outstanding
voting securities of the Trust. The Distributor, or the Trust, by vote
of a majority of the Disinterested Trustees or of the holders of a
majority of the outstanding voting securities of the Fund, may
terminate the Agreement under this Plan, without penalty, upon 30 days'
written notice to the other party.
8. So long as the Plan remains in effect, the selection of persons to
serve as Trustees of the Trust who are not "interested persons" of the
Trust shall be committed to the discretion of the directors then in
office who are not "interested persons" of the Trust. However, nothing
contained herein shall prevent the participation of other persons in
the selection and nomination process, provided that a final decision on
any such selection or nomination is within the discretion of, and
approved by, a majority of the Trustees of the Trust then in office who
are not "interested persons" of the Trust.
9. This Plan may not be amended to increase the amount to be spent by the
Trust hereunder without approval of a majority of the outstanding
voting securities of the Fund. All material amendments to the Plan and
Agreement must be approved by the vote of the Board of Trustees of the
Trust including a majority of the Disinterested Trustees, cast in
person at a meeting called for the purpose of voting on such amendment.
10. To the extent that this Plan and Agreement constitutes a Plan of
Distribution adopted pursuant to Rule 12b-1 under the Act it shall
remain in effect as such, so as to authorize the use by the Trust of
its assets in the amounts and for the purposes set forth herein,
notwithstanding the occurrence of an "assignment," as defined by the
Act and the rules thereunder. To the extent it constitutes an
agreement with the Distributor pursuant to a plan, it shall terminate
automatically in the event of such "assignment." Upon a termination of
the agreement with the Distributor, the Trust may continue to make
payments pursuant to the Plan only upon the approval of a new agreement
under this Plan and Agreement, which may or may not be with the
Distributor, or the adoption of other arrangements regarding the use of
the amounts authorized to be paid by the Trust hereunder, by the
Trust's Board of Trustees in accordance with the procedures set forth
in paragraph 7 above.
11. The Trust shall preserve copies of this Plan and Agreement and all
reports made pursuant to paragraph 6 hereof, together with minutes of
all Board of Trustees meetings at which the adoption, amendment of
continuance of the Plan were considered (describing the factors
considered and the basis for decision), for a period of not less than
six years from the date of this Plan and Agreement, or any such reports
or minutes, as the case may be, the first two years in an easily
accessible place.
C-60
<PAGE>
12. This Plan and Agreement shall be construed in accordance with the laws
of the State of Michigan and applicable provisions of the Act. To the
extent the applicable laws of the State of Michigan, or any provisions
herein, conflict with the applicable provisions of the Act, the latter
shall control.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Plan and Agreement on the 22nd day of April, 1998.
AMWAY MUTUAL FUND TRUST
By: /s/ James J. Rosloniec
---------------------------------
ATTEST: James J. Rosloniec
--------------------------- President
AMWAY MANAGEMENT COMPANY
By: /s/ Allan D. Engel
---------------------------------
ATTEST: Allan D. Engel
--------------------------- President
C-61
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 25. Persons Controlled by or under Common Control with Registrant
Not Applicable.
ITEM 26. Number of Holders of Securities
Listed below is the number of Amway Mutual Fund, Inc. common stock
shareholders as of December 31, 1997. Common stock with a par value
of $1 is the only class of stock issued.
<TABLE>
<CAPTION>
Title of Class Number of Record Holders
-------------- ------------------------
<S> <C>
Common Stock 18,694
</TABLE>
ITEM 27. Indemnification
Indemnification is covered in Section 9 of the Principal Underwriter
Agreement between Amway Mutual Fund and Amway Management Company,
which is filed as an exhibit hereto. Also, a Joint Directors and
Officers Liability Insurance Policy for Amway Management Company and
Amway Mutual Fund. is provided by those entities. The Sixth Article
of the Agreement and Declaration of Trust of Amway Mutual Fund, which
is filed as an exhibit hereto, provides for indemnification for any
person to the extent permitted by law.
ITEM 28. Business and Other Connections of Investment Adviser.
Amway Management Company acts as the investment advisor, principal
underwriter, and transfer agent for Amway Mutual Fund and as a
servicing agent for the Cash Equivalent Fund.
Business histories of each Director and Officer of the Investment
Adviser of the Registrant are incorporated by reference to the
Registration Statement under the Securities Act of 1933, Post
Effective Amendment No. 43, Part C, Pages 233 through 240.
Business histories of the Sub-Adviser for the Registrant and of
each of its Directors and Officers are incorporated by reference to
the Registration Statement under the Securities Act of 1933, Post
Effective Amendment No. 43, Part C, Pages 241 through 242.
C-62
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 29. Principal Underwriter
(a) The principal underwriter, Amway Management Company, acts as such only
for Amway Mutual Fund. Listed below is the information required pertaining
to the individual Directors and Officers of the principal underwriter.
There is no other principal underwriter.
<TABLE>
<CAPTION>
(b) Name and Principal Positions and Office Position and Offices
Business Address With Underwriter With Registrant
------------------ -------------------- ---------------------
<C> <C> <C>
James J. Rosloniec Vice President, Treasurer President, Treasurer
7575 Fulton Street, East and Director and Director
Ada, MI 49355-0001
Allan D. Engel President, Secretary and Secretary and Assistant
7575 Fulton Street, East Director Treasurer
Ada, MI 49355-7150
</TABLE>
(c) Not Applicable.
ITEM 30. Location of Accounts and Records
With respect to each account, book, or other document required to
be maintained by Section 31(a) of the 1940 Act and the Rules (17
CFR 270.31a-1 to 31a-3) promulgated thereunder, all transfer agent
and shareholder records are in the custody and control of Amway
Management Company., Ada, Michigan, pursuant to the Common Records
Agreement Among Amway Mutual Fund and Amway Management Company, all
portfolio securities held or in transfer are under the control of
the Custodian, Michigan National Bank, Grand Rapids, Michigan; all
portfolio security records and brokerage records related thereto
are in the custody and control of Amway Management Company, Ada,
Michigan, or Ark Asset Management Company, Inc., the Sub-Adviser,
pursuant to the Sub-Advisory Agreement; and all remaining records
are in the custody and control of Amway Mutual Fund, Ada, Michigan.
ITEM 31. Management Services
Amway Management Company has entered into a contract with DST, Inc.
which provides access to a data processing recordkeeping system for
stockholder accounting. The system provides and supports remote
terminal access to DST facilities for the maintenance of
stockholder records, processing of information, and the generation
of output with respect thereto. Pursuant to this agreement, Amway
Management has paid to DST, including equipment costs, telephone
lines, and service fees for the three rears ending August 31, 1997,
the fiscal year-end, a total of $279,930.59.
C-63
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 32. Undertakings
(a) Not applicable - Amway Mutual Fund Trust adopts the Form N-8A
notification and Form N-1A registration statement of Amway
Mutual Fund, Inc. as the notification and registration
statement of the Trust, effective as of the effective date of
this Post-Effective Amendment.
(b) Not applicable - Amway Mutual Fund Trust adopts the Form N-8A
notification and Form N-1A registration statement of Amway
Mutual Fund, Inc. as the notification and registration
statement of the Trust, effective as of the effective date of
this Post-Effective Amendment.
(c) Amway Mutual Fund undertakes to furnish to each person to
whom a prospectus is delivered a copy of the Fund's latest
Annual Report to Shareholders, upon request and without charge.
C-64
<PAGE>
AMWAY MUTUAL FUND
FORM N-1A
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, the Registrant certifies that it
meets all of the requirements for effectiveness of this Registration
Statement pursuant to Rule 485(a) Under the Securities Act of 1933, and has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereto duly authorized in the Township of Ada,
and State of Michigan, on the day of APRIL 28, 1998.
- -------------------------------------------------------------------------------
AMWAY MUTUAL FUND TRUST
- -------------------------------------------------------------------------------
By /s/ James J. Rosloniec
----------------------
JAMES J. ROSLONIEC
President
- -------------------------------------------------------------------------------
Pursuant to the requirements of the Securities Act of 1933, as amended, and
the Investment Company Act of 1940, this Amendment to the Registration Statement
has been signed below by the following persons in the capacities and on the date
indicated:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Signature Title and Capacity Date
- --------------------------------------------------------------------------------
<S> <C> <C>
/s/James J. Rosloniec Principal Executive and April 28, 1998
- --------------------- Financial Officer and --------------
JAMES J. ROSLONIEC Trustee
/s/ Allan D. Engel Principal Accounting April 28, 1998
- --------------------- Officer and Trustee --------------
ALLAN D. ENGEL
RICHARD A. DEWITT Trustee
DONALD H. JOHNSON Trustee
WALTER T. JONES Trustee
By /s/ James J. Rosloniec April 28, 1998
---------------------- --------------
JAMES J. ROSLONIEC
(Attorney-in-Fact)
</TABLE>
