1933 Act File No. 2-49591
1940 Act File No. 811-2430
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No. ....................
Post-Effective Amendment No. __77___ ................... X
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 35 __ ................................. X
MONEY MARKET MANAGEMENT, INC.
(Exact Name of Registrant as Specified in Charter)
Federated Investors Funds,
5800 Corporate Drive,
Pittsburgh, Pennsylvania 15237-7000
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire,
Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
immediately upon filing pursuant to paragraph (b)
X_ on February 28, 1998 pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a) (i) on pursuant to paragraph
(a) (i) 75 days after filing pursuant to paragraph (a)(ii) on
_________________ pursuant to paragraph (a)(ii) of Rule 485.
If appropriate, check the following box:
This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Copies to:
Matthew G. Maloney, Esquire
Dickstein Shapiro Morin & Oshinsky L.L.P.
2101 L Street, N.W.
Washington, D.C. 20037
<PAGE>
CROSS-REFERENCE SHEET
This amendment to the Registration Statement of MONEY MARKET MANAGEMENT,
INC. is comprised of the following:
PART A. INFORMATION REQUIRED IN A PROSPECTUS.
Prospectus Heading
(Rule 404(c) Cross Reference)
Item 1. Cover Page....................Cover Page.
Item 2. Synopsis......................Summary of Company Expenses.
Item 3. Condensed Financial
Information..................Financial Highlights; Performance
Information; Financial Statements.
Item 4. General Description of
Registrant...................General Information; Investment
Information; Investment Objective;
Investment Policies; Investment
Risks; Investment Limitations.
Item 5. Management of the Fund........Company Information; Management of
the Company; Distribution of Shares;
Administration of the Company.
Item 6. Capital Stock and Other
Securities...................Account and Share Information;
Dividends; Capital Gains; Voting
Rights; Tax Information; Federal
Income Tax; State and Local Taxes.
Item 7. Purchase of Securities Being
Offered......................Net Asset Value; How to Purchase
Shares; Purchasing Shares Through a
Financial institution; Purchasing
Shares by Wire; Purchasing Shares by
Check;Contingent Deferred Sales
Charge; Special Purchase Features;
Account Activity; Exchange Privilege;
Making an Exchange.
Item 8. Redemption or Repurchase......How
to Redeem Shares; Redeeming Shares
Through a Financial Institution;
Redeeming Shares By Telephone;
Redeeming Shares By Mail; Special
Redemption Features; Accounts With Low
Balances.
Item 9. Pending Legal Proceedings.....None.
<PAGE>
PART B. INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION.
Item 10. Cover Page....................Cover Page.
Item 11. Table of Contents.............Table of Contents.
Item 12. General Information and
History Filed in Part A.
Item 13. Investment Objectives and
Policies.....................Investment Policies; Investment
Limitations.
Item 14. Management of the Fund........Money Market Management, Inc.
Management; Directors' Compensation;
Director Liability.
Item 15. Control Persons and Principal
Holders of Securities Share Ownership.
Item 16. Investment Advisory and Other
Services.....................Investment Advisory Services; Other
Services; Company Administration;
Custodian and Portfolio
Accountant; Transfer Agent; Independent Public Accountants.
Item 17. Brokerage Allocation..........Brokerage Transactions.
Item 18. Capital Stock and Other
Securities Not applicable.
Item 19. Purchase, Redemption and
Pricing of Securities Being
Offered......................Determining Net Asset Value;
Redemption in Kind.
Item 20. Tax Status....................The Company's Tax Status.
Item 21. Underwriters Shareholder Services.
Item 22. Calculation of Performance
Data.........................Yield; Effective Yield; Total Return;
Performance Comparisons.
Item 23. Financial Statements..........Filed in Part A.
MONEY MARKET MANAGEMENT, INC.
PROSPECTUS
The shares of Money Market Management, Inc. (the "Company") offered by this
prospectus represent interests in an open-end management investment company (a
mutual fund). The Company invests in short-term money market securities to
achieve current income consistent with stability of principal.
THE SHARES OFFERED BY THIS PROSPECTUS ARE NOT DEPOSITS OR OBLIGATIONS OF ANY
BANK, ARE NOT ENDORSED OR GUARANTEED BY ANY BANK AND ARE NOT INSURED OR
GUARANTEED BY THE U.S. GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION,
THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENT AGENCY. INVESTMENT IN THESE
SHARES INVOLVES INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL. THE
COMPANY ATTEMPTS TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE; THERE
CAN BE NO ASSURANCE THAT THE COMPANY WILL BE ABLE TO DO SO.
This prospectus contains the information you should read and know before you
invest in the Company. Keep this prospectus for future reference.
The Company has also filed a Statement of Additional Information dated February
28, 1998, with the Securities and Exchange Commission ("SEC"). The information
contained in the Statement of Additional Information is incorporated by
reference into this prospectus. You may request a copy of the Statement of
Additional Information or a paper copy of this prospectus, if you have received
your prospectus electronically, free of charge by calling 1-800-341-7400. To
obtain other information, or make inquiries about the Company, contact your
financial institution. The Statement of Additional Information, material
incorporated by reference into this document, and other information regarding
the Company is maintained electronically with the SEC at Internet Web site
(http://www.sec.gov). THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Prospectus dated
February 28, 1998 TABLE OF CONTENTS <TABLE> <S> <C>
Summary of Company Expenses 1 Financial Highlights 2 General Information 3
Investment Information 3 Investment Objective 3 Investment Policies 3
Investment Risks 5 Investment Limitations 5 Company Information 5 Management of
the Company 5 Distribution of Shares 6 Administration of the Company 7 Net
Asset Value 7 How to Purchase Shares 7 Purchasing Shares Through a Financial
Institution 7 Purchasing Shares by Wire 7 Purchasing Shares by Check 7
Contingent Deferred Sales Charge 8 Special Purchase Features 8 Exchange
Privilege 8 Making an Exchange 9 How to Redeem Shares 9 Redeeming Shares
Through a Financial Institution 9 Redeeming Shares by Telephone 9 Redeeming
Shares by Mail 10 Special Redemption Features 10 Account and Share Information
10 Dividends 10 Capital Gains 10 Account Activity 10 Accounts with Low Balances
10 Voting Rights 10 Tax Information 11 Federal Income Tax 11 State and Local
Taxes 11 Performance Information 11 Financial Statements 12 Independent
Auditors' Report 20
</TABLE>
SUMMARY OF COMPANY EXPENSES
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Maximum Sales Charge Imposed on Purchases (as a percentage of offering price) None
Maximum Sales Charge Imposed on Reinvested Dividends (as a percentage of offering price None
Contingent Deferred Sales Charge* (as a percentage of original purchase price
or redemption proceeds, as applicable) None
Redemption Fee (as a percentage of amount redeemed, if applicable) None
Exchange Fee None
</TABLE>
ANNUAL OPERATING EXPENSES
(As a percentage of average net assets)
<TABLE>
<S> <C> <C>
Management Fee (after waiver)(1) 0.48%
12b-1 Fee None
Total Other Expenses 0.62%
Shareholder Services Fee (after waiver)(2) 0.12%
Total Operating Expenses(3) 1.10%
</TABLE>
(1) The management fee has been reduced to reflect the voluntary waiver of a
portion of the management fee. The adviser can terminate this voluntary waiver
at any time at its sole discretion. The maximum management fee is 0.50%.
(2) The shareholder services fee has been reduced to reflect the voluntary
waiver of a portion of the shareholder services fee. The shareholder service
provider can terminate this voluntary waiver at any time at its sole discretion.
The maximum shareholder services fee is 0.25%.
(3) The total operating expenses would have been 1.25% absent the voluntary
waivers of portions of the management fee and shareholder services fee.
* A contingent deferred sales charge of 1% will be imposed only under certain
limited circumstances in which Company shares being redeemed were acquired in
exchange for Class F Shares of another Federated Fund.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of the Company will bear, either directly
or indirectly. For more complete descriptions of the various costs and expenses,
see "Redeeming Shares" and "Company Information." Wire-transferred redemptions
of less than $5,000 may be subject to additional fees.
EXAMPLE
You 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.
1 Year $ 11
3 Years $ 35
5 Years $ 61
10 Years $134
THE ABOVE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR
FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
Reference is made to the Independent Auditors' Report on page 20.
<TABLE>
<CAPTION>
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, $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
BEGINNING OF PERIOD
INCOME FROM INVESTMENT
OPERATIONS
Net investment income 0.05 0.05 0.05 0.03 0.02 0.03 0.05 0.07 0.08 0.07
LESS DISTRIBUTIONS
Distributions from net
investment income (0.05) (0.05) (0.05) (0.03) (0.02) (0.03) (0.05) (0.07) (0.08) (0.07)
NET ASSET VALUE, END OF
PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
TOTAL RETURN(A) 4.69% 4.56% 5.13% 3.31% 2.19% 2.86% 5.43% 7.65% 8.73% 7.03%
RATIOS TO AVERAGE
NET ASSETS
Expenses 1.10% 1.06% 1.08% 1.14% 1.17% 1.11% 0.96% 0.89% 0.89% 0.91%
Net investment income 4.58% 4.46% 4.99% 3.27% 2.15% 2.85% 5.32% 7.38% 8.39% 6.81%
Expense waiver/
reimbursement(b) 0.15% 0.13% 0.15% 0.00% 0.07% 0.00% 0.00% 0.00% 0.00% 0.00%
SUPPLEMENTAL DATA
Net assets, end of $81,309 $87,381 $101,390 $114,588 $108,309 $127,711 $168,889 $194,836 $204,393 $188,239
period (000 omitted)
</TABLE>
(a) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(b) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
GENERAL INFORMATION
The Company was established as a Maryland corporation on October 30, 1973, and
was one of the first money market funds. The Company was reorganized as a
Massachusetts business trust on June 29, 1982, and then re-established as a
Maryland corporation under Articles of Incorporation dated August 19, 1992. The
Company is designed for investors with temporary cash balances and investors
with cash reserves as a convenient means of accumulating an interest in a
professionally managed, diversified portfolio investing in short-term money
market securities. A minimum initial investment of $500 is required except for
retirement plans.
The Company attempts to stabilize the value of a share at $1.00. Shares are
currently sold and redeemed at that price. However, a contingent deferred sales
charge may be imposed under certain circumstances.
INVESTMENT INFORMATION
INVESTMENT OBJECTIVE
The investment objective of the Company is current income consistent with
stability of principal. While there is no assurance that the Company will
achieve its investment objective, it endeavors to do so by complying with the
diversification and other requirements of Rule 2a-7 under the Investment Company
Act of 1940 which regulates money market mutual funds and by following the
investment policies described in this prospectus. The investment objective and
the policies and limitations described below, unless indicated otherwise, cannot
be changed without shareholder approval.
INVESTMENT POLICIES
The Company pursues its investment objective by investing in a portfolio of
money market securities maturing in 397 days or less. As a matter of operating
policy which can be changed without shareholder approval, the average maturity
of the securities in the Company's portfolio, computed on a dollar-weighted
basis, will be 90 days or less. ACCEPTABLE INVESTMENTS The Company
invests in high quality money market instruments that are either rated in one of
the two highest short-term rating categories by one or more nationally
recognized statistical rating organizations ("NRSROs") or are of comparable
quality to securities having such ratings. Examples of these instruments
include, but are not limited to:
* domestic issues of corporate debt obligations, including variable rate
demand notes;
* commercial paper (including Canadian Commercial Paper and Europaper); *
certificates of deposit, demand and time deposits, bankers' acceptances
and other instruments of domestic and foreign banks and other deposit
institutions ("Bank Instruments");
* short-term credit facilities;
* asset-backed securities;
* obligations issued or guaranteed as to payment of principal and
interest by the U.S. government or one of its agencies or
instrumentalities; and
* other money market instruments.
The Company invests only in instruments denominated and payable in U.S.
dollars.
VARIABLE RATE DEMAND NOTES
Variable rate demand notes are long-term debt instruments that have variable
or floating interest rates and provide the Company with the right to tender
the security for repurchase at its stated principal amount plus accrued
interest. Such securities typically bear interest at a rate that is intended
to cause the securities to trade at par. The interest rate may float or be
adjusted at regular intervals (ranging from daily to annually), and is
normally based on a published interest rate or interest rate index. Most
variable rate demand notes allow the Company to demand the repurchase of the
security on not more than seven days prior notice. Other notes only permit
the Company to tender the security at the time of each interest rate
adjustment or at other fixed intervals. See "Demand Features." The Company
treats variable rate demand notes as maturing on the later of the date of the
next interest rate adjustment or the date on which the Company may next
tender the security for repurchase.
BANK INSTRUMENTS
The Company only invests in Bank Instruments either issued by an institution
having capital, surplus and undivided profits over $100 million, or insured
by the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF"). Bank Instruments may include Eurodollar Certificates of Deposit
("ECDs"), Yankee Certificates of Deposit ("Yankee CDs") and Eurodollar Time
Deposits ("ETDs"). The Company will treat securities credit enhanced with a
bank's letter of credit as Bank Instruments.
ASSET-BACKED SECURITIES
Asset-backed securities are securities issued by special purpose entities
whose primary assets consist of a pool of loans or accounts receivable. The
securities may take the form of beneficial interests in special purpose
trusts, limited partnership interests, or commercial paper or other debt
securities issued by a special purpose corporation. Although the securities
often have some form of credit or liquidity enhancement, payments on the
securities depend predominantly upon collections of the loans and receivables
held by the issuer.
SHORT-TERM CREDIT FACILITIES
The Company may enter into, or acquire participations in, short-term
borrowing arrangements with corporations, consisting of either a short-term
revolving credit facility or a master note agreement payable upon demand.
Under these arrangements, the borrower may reborrow funds during the term of
the facility. The Company treats any commitments to provide such advances as
a standby commitment to purchase the borrower's notes.
REPURCHASE AGREEMENTS
Certain securities in which the Company invests may be purchased pursuant to
repurchase agreements. Repurchase agreements are arrangements in which banks,
broker/dealers, and other recognized financial institutions sell securities to
the Company and agree at the time of sale to repurchase them at a mutually
agreed upon time and price. To the extent that the seller does not repurchase
the securities from the Company, the Company could receive less than the
repurchase price on any sale of such securities.
CREDIT ENHANCEMENT
Certain of the Company's acceptable investments may be credit-enhanced by a
guaranty, letter of credit, or insurance. Any bankruptcy, receivership, or
default of the party providing the credit enhancement will adversely affect the
quality and marketability of the underlying security.
DEMAND FEATURES
The Company may acquire securities that are subject to puts and standby
commitments ("demand features") to purchase the securities at their principal
amount (usually with accrued interest) within a fixed period (usually seven
days) following a demand by the Company. The demand feature may be issued by the
issuer of the underlying securities, a dealer in the securities, or by another
third party, and may not be transferred separately from the underlying security.
The Company uses these arrangements to provide the Company with liquidity and
not to protect against changes in the market value of the underlying securities.
The bankruptcy, receivership, or default by the issuer of the demand feature, or
a default on the underlying security or other event that terminates the demand
feature before its exercise, will adversely affect the liquidity of the
underlying security. Demand features that are exercisable even after a payment
default on the underlying security may be treated as a form of credit
enhancement.
WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS
The Company may purchase securities on a when-issued or delayed delivery basis.
These transactions are arrangements in which the Company purchases securities
with payment and delivery scheduled for a future time. The seller's failure to
complete these transactions may cause the Company to miss a price or yield
considered to be advantageous. Settlement dates may be a month or more after
entering into these transactions, and the market values of the securities
purchased may vary from the purchase prices. Accordingly, the Company may pay
more or less than the market value of the securities on the settlement date.
The Company may dispose of a commitment prior to settlement if the adviser deems
it appropriate to do so. In addition, the Company may enter into transactions to
sell its purchase commitments to third parties at current market values and
simultaneously acquire other commitments to purchase similar securities at later
dates. The Company may realize short-term profits or losses upon the sale of
such commitments.
RESTRICTED AND ILLIQUID SECURITIES
The Company may invest in restricted securities. Restricted securities are any
securities in which the Company may invest pursuant to its investment objective
and policies but which are subject to restrictions on resale under federal
securities law. However, the Company will limit investments in illiquid
securities, including certain restricted securities not determined by the
Directors to be liquid, non-negotiable time deposits, and repurchase agreements
providing for settlement in more than seven days after notice, to 10% of its net
assets. The Company may invest in commercial paper issued in reliance on the
exemption from registration afforded by Section 4(2) of the Securities Act of
1933. Section 4(2) commercial paper is restricted as to disposition under
federal securities law, and is generally sold to institutional investors, such
as the Company, who agree that they are purchasing the paper for investment
purposes and not with a view to public distribution. Any resale by the purchaser
must be in an exempt transaction. Section 4(2) commercial paper is normally
resold to other institutional investors like the Company through or with the
assistance of the issuer or investment dealers who make a market in Section 4(2)
commercial paper, thus providing liquidity. The Company believes that Section
4(2) commercial paper and possibly certain other restricted securities which
meet the criteria for liquidity established by the Directors are quite liquid.
The Company intends, therefore, to treat the restricted securities which meet
the criteria for liquidity established by the Directors, including Section 4(2)
commercial paper, as determined by the Company's investment adviser, as liquid
and not subject to the investment limitation applicable to illiquid securities.
In addition, because Section 4(2) commercial paper is liquid, the Company
intends to not subject such paper to the limitation applicable to restricted
securities. INVESTMENT RISKS
ECDs, ETDs, Yankee CDs, Canadian Commercial Paper, and Europaper are subject to
different risks than domestic obligations of domestic banks or corporations.
Examples of these risks include international economic and political
developments, foreign governmental restrictions that may adversely affect the
payment of principal or interest, foreign withholding or other taxes on interest
income, difficulties in obtaining or enforcing a judgment against the issuing
entity, and the possible impact of interruptions in the flow of international
currency transactions. Risks may also exist for ECDs, ETDs, and Yankee CDs
because the banks issuing these instruments, or their domestic or foreign
branches, are not necessarily subject to the same regulatory requirements that
apply to domestic banks, such as reserve requirements, loan limitations,
examinations, accounting, auditing, recordkeeping, and the public availability
of information. These factors will be carefully considered by the Company's
adviser in selecting investments for the Company.
INVESTMENT LIMITATIONS
The Company will not borrow money directly or through reverse repurchase
agreements (arrangements in which the Company sells a money market instrument
for a percentage of its cash value with an agreement to buy it back on a set
date) or pledge securities except, under certain circumstances, the Company may
borrow up to one-third of the value of its total assets and pledge up to 10% of
the value of those assets to secure such borrowings. These investment
limitations cannot be changed without shareholder approval.
COMPANY INFORMATION
MANAGEMENT OF THE COMPANY
BOARD OF DIRECTORS
The Company is managed by a Board of Directors. The Directors are responsible
for managing the Company's business affairs and for exercising all the Company's
powers except those reserved for the shareholders. An Executive Committee of the
Board of Directors handles the Board's responsibilities between meetings of the
Board.
INVESTMENT ADVISER
Investment decisions for the Company are made by Federated Advisers, the
Company's investment adviser, subject to direction by the Directors. The adviser
continually conducts investment research and supervision for the Company and is
responsible for the purchase and sale of portfolio instruments.
ADVISORY FEES
The adviser receives an annual investment advisory fee based on the Company's
average net assets as shown in the chart below:
<TABLE>
<CAPTION>
ADVISORY FEES AS
AVERAGE DAILY PERCENTAGE OF AVERAGE
NET ASSETS DAILY NET ASSETS
<S> <C>
First $500 million 0.500 of 1%
Second $500 million 0.475 of 1%
Third $500 million 0.450 of 1%
Fourth $500 million 0.425 of 1%
Over $2 billion 0.400 of 1%
</TABLE>
The adviser may voluntarily choose to waive a portion of its fee or reimburse
other expenses of the Company, but reserves the right to terminate such
waiver or reimbursement at any time at its sole discretion.
ADVISER'S BACKGROUND
Federated Advisers, a Delaware business trust, organized on April 11, 1989,
is a registered investment adviser under the Investment Advisers Act of 1940.
It is a subsidiary of Federated Investors. All of the Class A (voting) shares
of Federated Investors are owned by a trust, the trustees of which are John
F. Donahue, Chairman and Trustee of Federated Investors, Mr. Donahue's wife,
and Mr. Donahue's son, J. Christopher Donahue, who is President and Trustee
of Federated Investors.
Federated Advisers and other subsidiaries of Federated Investors serve as
investment advisers to a number of investment companies and private accounts.
Certain other subsidiaries also provide administrative services to a number
of investment companies. With over $120 billion invested across more than 300
funds under management and/or administration by its subsidiaries, as of
December 31, 1997, Federated Investors is one of the largest mutual fund
investment managers in the United States. With more than 2,000 employees,
Federated continues to be led by the management who founded the company in
1955. Federated funds are presently at work in and through approximately
4,000 financial institutions nationwide.
Both the Company and the adviser have adopted strict codes of ethics governing
the conduct of all employees who manage the Company and its portfolio
securities. These codes recognize that such persons owe a fiduciary duty to the
Company's shareholders and must place the interests of shareholders ahead of the
employees' own interests. Among other things, the codes: require preclearance
and periodic reporting of personal securities transactions; prohibit personal
transactions in securities being purchased or sold, or being considered for
purchase or sale, by the Company; prohibit purchasing securities in initial
public offerings; and prohibit taking profits on securities held for less than
sixty days. Violations of the codes are subject to review by the Directors, and
could result in severe penalties.
DISTRIBUTION OF SHARES
Federated Securities Corp. is the principal distributor for shares of the
Company. It is a Pennsylvania corporation organized on November 14, 1969,
and is the principal distributor for a number of investment companies.
Federated Securities Corp. is a subsidiary of Federated Investors.
SHAREHOLDER SERVICES
The Company has entered into a Shareholder Services Agreement with Federated
Shareholder Services, a subsidiary of Federated Investors, under which the
Company may make payments up to 0.25% of the average daily net asset value of
its shares, computed at an annual rate, to obtain certain personal services for
shareholders and to maintain shareholder accounts. From time to time and for
such periods as deemed appropriate, the amount stated above may be reduced
voluntarily. Under the Shareholder Services Agreement, Federated
Shareholder Services will either perform shareholder services directly or will
select financial institutions to perform shareholder services. Financial
institutions will receive fees based upon shares owned by their clients or
customers. The schedules of such fees and the basis upon which such fees will be
paid will be determined from time to time by the Company and Federated
Shareholder Services.
SUPPLEMENTAL PAYMENTS TO FINANCIAL INSTITUTIONS
In addition to payments made pursuant to the Shareholder Services Agreement,
Federated Securities Corp. and Federated Shareholder Services, from their own
assets, may pay financial institutions supplemental fees for the performance of
substantial sales services, distribution-related support services, or
shareholder services. The support may include sponsoring sales, educational and
training seminars for their employees, providing sales literature, and
engineering computer software programs that emphasize the attributes of the
Company. Such assistance may be predicated upon the amount of shares the
financial institution sells or may sell, and/or upon the type and nature of
sales or marketing support furnished by the financial institution. Any payments
made by the distributor may be reimbursed by the Company's investment adviser or
its affiliates.
ADMINISTRATION OF THE COMPANY
ADMINISTRATIVE SERVICES
Federated Services Company, a subsidiary of Federated Investors, provides
administrative personnel and services (including certain legal and financial
reporting services) necessary to operate the Company at an annual rate which
relates to the average aggregate daily net assets of all funds advised by
affiliates of Federated Investors specified below: <TABLE> <CAPTION>
MAXIMUM AVERAGE AGGREGATE
FEE DAILY NET ASSETS
<C> <C>
0.150% on the first $250 million
0.125% on the next $250 million
0.100% on the next $250 million
0.075% on assets in excess of $750 million
</TABLE>
The administrative fee received during any fiscal year shall be at least
$125,000 per portfolio and $30,000 per each additional class of shares.
Federated Services Company may choose voluntarily to waive a portion of its fee.
NET ASSET VALUE
The Company attempts to stabilize the net asset value of its shares at $1.00 by
valuing the portfolio securities using the amortized cost method. The net asset
value per share is determined by subtracting total liabilities from total assets
and dividing the remainder by the number of shares outstanding. The Company
cannot guarantee that its net asset value will always remain at $1.00 per share.
The net asset value is determined at 12:00 noon, (Eastern time), and as of
the close of trading (normally 4:00 p.m., Eastern time) on the New York Stock
Exchange, Monday through Friday, except on New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day, and Christmas Day. HOW TO PURCHASE SHARES
Shares are sold at their net asset value, without a sales charge, next
determined after an order is received, on days which the New York Stock Exchange
is open for business. Shares may be purchased as described below, either through
a financial institution (such as a bank or broker/dealer) or by wire or by check
directly from the Company, with a minimum initial investment of $500 or more or
additional investments of as little as $100. The minimum initial and subsequent
investments for retirement plans are only $50. Financial institutions may impose
different minimum investment requirements on their customers.
In connection with any sale, Federated Securities Corp. may from time to time
offer certain items of nominal value to any shareholder or investor. The Company
reserves the right to reject any purchase request. An account must be
established at a financial institution or by completing, signing, and returning
the new account form available from the Company before shares can be purchased.
PURCHASING SHARES THROUGH A FINANCIAL INSTITUTION
Investors may purchase shares through a financial institution which has a sales
agreement with the distributor. Orders are considered received when the Company
receives payment by wire or converts payment by check from the financial
institution into federal funds. It is the financial institution's responsibility
to transmit orders promptly. Financial institutions may charge additional fees
for their services.
PURCHASING SHARES BY WIRE
Shares may be purchased by Federal Reserve wire by calling the Company before
3:00 p.m. (Eastern time) to place an order. The order is considered received
immediately. Payment by federal funds must be received before 3:00 p.m. (Eastern
time) in order to begin earning dividends that same day. Federal funds should be
wired as follows: Federated Shareholder Services Company, c/o State Street Bank
and Trust Company, Boston, MA; Attention: EDGEWIRE; For Credit to: Money Market
Management, Inc.; Fund Number (this number can be found on the account statement
or by contacting the Company); Group Number or Order Number; Nominee or
Institution Name; and ABA Number 011000028. Shares cannot be purchased by wire
on holidays when wire transfers are restricted. Questions on wire purchases
should be directed to your shareholder services representative at the telephone
number listed on your account statement. PURCHASING SHARES BY CHECK
Shares may be purchased by sending a check to Federated Shareholder Services
Company, P.O. Box 8600, Boston, MA 02266-8600. The check should be made payable
to: Money Market Management, Inc. Please include an account number on the check.
Orders by mail are considered received when payment by check is converted into
federal funds (normally the business day after the check is received), and
shares begin earning dividends the next day.
CONTINGENT DEFERRED SALES CHARGE
A contingent deferred sales charge will be imposed only in certain instances in
which the Company shares being redeemed were acquired in exchange for Class F
Shares of certain other Federated Funds ("Participating Fund"). (Please see
"Exchange Privilege.") If Company shares were acquired in exchange for shares of
a Participating Fund, a redemption of those Company shares within four years of
the initial Participating Fund purchase will be subject to a contingent deferred
sales charge of 1% of the lesser of the purchase price of the shares acquired in
the initial Participating Fund purchase or the net asset value of the Company
shares acquired through the exchange. The contingent deferred sales charge will
not be imposed on Company shares obtained through the reinvestment of dividends
or distributions of long-term capital gains. In imposing the contingent deferred
sales charge, if any, redemptions of Company shares are deemed to relate first
to shares of other Participating Funds acquired through the reinvestment of
dividends and long-term capital gains, second to purchases of shares occurring
more than four years before the date of redemption, and finally to purchases of
such shares within the previous four years.
Also, the contingent deferred sales charge will not be imposed in connection
with redemptions by the Company of accounts with low balances or when a
redemption results from a return under the following circumstances: (i) a total
or partial distribution from a qualified plan, other than an IRA, Keough Plan,
or a custodial account, following retirement; (ii) a total or partial
distribution from an IRA, Keough Plan, or a custodial account after the
beneficial owner attains age 59-1/2; or (iii) from the death or disability of
the last surviving beneficial owner. The exemption from the contingent deferred
sales charge for qualified plans, an IRA, Keough Plan or a custodial account
does not extend to account transfers, rollovers, and other redemptions made for
purposes of reinvestment.
INVEST-BY-PHONE
Once an account has been opened, a shareholder may use invest-by-phone for
investments if an authorization form has been filed with Federated Shareholder
Services Company, the transfer agent for shares of the Company. Approximately
two weeks after sending the form to Federated Shareholder Services Company, the
shareholder may call Federated Shareholder Services Company to purchase shares.
Federated Shareholder Services Company will send a request for monies to the
shareholder's commercial bank, savings bank, or credit union ("bank") via the
Automated Clearing House ("ACH"). The shareholder's bank, which must be an ACH
member, will then forward the monies to Federated Shareholder Services Company.
The purchase is normally entered the next business day after the initial phone
request. For further information and an application, call the Company. BY
DIRECT DEPOSIT
Shareholders of the Company may have their Social Security, Railroad Retirement,
VA Compensation or Pension, Civil Service Retirement, and certain other
retirement payments invested directly into their Company account. Shareholders
must complete an application and file it with Federated Shareholder Services
Company prior to use of this program. Allow 60 to 90 days for the application to
be processed.
SPECIAL PURCHASE FEATURES
SYSTEMATIC INVESTMENT PROGRAM
A minimum of $100 can be automatically withdrawn periodically from the
shareholder's checking account at an ACH member and invested in Company shares.
Shareholders should contact their financial institution or the Company to
participate in this program. EXCHANGE PRIVILEGE
The Company has exchange privileges with the Class F Shares of Participating
Funds. Not all Federated Funds participate in the exchange privilege or
currently offer Class F Shares. Contact your financial institution regarding the
availability of Class F Shares of the Federated Funds.
Shares of the Participating Funds may be exchanged for Company shares at net
asset value. Company shares may also be exchanged for Participating Funds at net
asset value plus a 1% contingent deferred sales charge if applicable and not
previously paid. No additional fees are imposed on exchanges. This privilege is
available to shareholders resident in any state in which the funds share being
acquired may be sold.
Shareholders using this privilege must exchange shares having a net asset value
of at least $1,500.
Each of the Participating Funds may also invest in certain other types of
securities as described in the prospectus of each fund.
Before the exchange, the shareholder must receive a prospectus for the fund for
which the exchange is being made.
An exercise of the exchange privilege is treated as a sale for federal
income tax purposes. Depending on the circumstances, a short-term or
long-term capital gain or loss may be realized.
Please contact your financial institution directly or Federated Securities
Corp. at 1-800-245-5051 for information on and prospectuses for the
Participating Funds into which Company shares may be exchanged.
MAKING AN EXCHANGE
Instructions for exchanges may be given in writing or by telephone. Written
instructions may be sent to Federated Shareholder Services Company, P.O. Box
8600, Boston, MA 02266-8600. Orders for exchanges received by Federated
Shareholder Services Company on any day the Company is open for business will be
executed as of the close of business that day.
Before an exchange can be made by telephone, a properly executed authorization
form must be completed and on file with Federated Shareholder Services Company.
Shares may be exchanged between two funds only if they have identical
shareholder registrations. Shares held in certificate form cannot be exchanged
by telephone until they are deposited to the shareholder's account at Federated
Shareholder Services Company. Telephone instructions may be recorded. If
reasonable procedures are not followed by the Fund, it may be liable for losses
due to unauthorized or fraudulent telephone instructions.
Shareholders may have difficulty making exchanges by telephone during times of
drastic economic or market changes. If this occurs, it is recommended that an
exchange request be made in writing.
HOW TO REDEEM SHARES
Shares are redeemed at their net asset value next determined after Federated
Shareholder Services Company receives the redemption request. Redemptions will
be made on days on which the Company computes its net asset value. Redemption
requests must be received in proper form and can be made as described below.
REDEEMING SHARES THROUGH A FINANCIAL INSTITUTION
Shares may be redeemed by contacting the shareholder's financial institution.
Shares will be redeemed at the net asset value next determined after Federated
Shareholder Services Company receives the redemption request. According to the
shareholder's instructions, redemption proceeds can be sent to the financial
institution or to the shareholder by check or by wire. The financial institution
is responsible for promptly submitting redemption requests and providing proper
written redemption instructions. Customary fees and commissions may be charged
by the financial institution for this service.
REDEEMING SHARES BY TELEPHONE
Redemptions in any amount may be made by calling the Company provided the
Company has a properly completed authorization form. These forms can be obtained
from Federated Securities Corp. Proceeds from redemption requests received
before 3:00 p.m. (Eastern time) will be wired the same day to the shareholder's
account at a domestic commercial bank which is a member of the Federal Reserve
System, but will not include that day's dividend. Proceeds from redeemed shares
purchased by check or through ACH will not be wired until that method of payment
has cleared. Proceeds from redemption requests received after that time include
that day's dividend but will be wired the following business day. Proceeds from
redemption requests on holidays when wire transfers are restricted will be wired
the following business day. Questions about telephone redemptions on days when
wire transfers are restricted should be directed to your shareholder services
representative at the telephone number listed on your account statement.
Telephone instructions may be recorded and if reasonable procedures are not
followed by the Company, it may be liable for losses due to unauthorized or
fraudulent telephone instructions.
In the event of drastic economic or market changes, a shareholder may experience
difficulty in redeeming by telephone. If this occurs, "Redeeming Shares by Mail"
should be considered. If at any time the Company shall determine it necessary to
terminate or modify the telephone redemption privilege, shareholders would be
promptly notified.
REDEEMING SHARES BY MAIL
Shares may be redeemed in any amount by mailing a written request to: Federated
Shareholder Services Company, P.O. Box 8600, Boston, MA 02266-8600. If share
certificates have been issued, they should be sent unendorsed with the written
request by registered or certified mail to the address noted above.
The written request should state: the Company name; the account name as
registered with the Company; the account number; and the number of shares to be
redeemed or the dollar amount requested. All owners of the account must sign the
request exactly as the shares are registered. Normally, a check for the proceeds
is mailed within one business day, but in no event more than seven days, after
the receipt of a proper written redemption request. Dividends are paid up to and
including the day that a redemption request is processed.
Shareholders requesting a redemption of any amount to be sent to an address
other than that on record with the Company or a redemption payable other than to
the shareholder of record must have their signatures guaranteed by a commercial
or savings bank, trust company or savings association whose deposits are insured
by an organization which is administered by the Federal Deposit Insurance
Corporation; a member firm of a domestic stock exchange; or any other "eligible
guarantor institution," as defined in the Securities Exchange Act of 1934. The
Company does not accept signatures guaranteed by a notary public.
SPECIAL REDEMPTION FEATURES
CHECK WRITING
Upon request, a checking account will be established to allow shareholders to
redeem their Company shares. Shareholder accounts will continue to receive the
daily dividend declared on the shares to be redeemed until the check is
presented to UMB Bank, N.A., the bank responsible for administering the check
writing program, for payment. However, checks should never be made payable or
sent to UMB Bank, N.A. or the Company to redeem shares, and a check may not be
written to close an account.
SYSTEMATIC WITHDRAWAL PROGRAM
If a shareholder's account has a value of at least $10,000, other than
retirement accounts subject to required minimum distributions, a systematic
withdrawal program may be established whereby automatic redemptions are made
from the account and transferred electronically to any commercial bank, savings
bank, or credit union that is an ACH member. Shareholders may apply for
participation in this program through their financial institutions or the
Company.
ACCOUNT AND SHARE INFORMATION
DIVIDENDS
Dividends are declared daily and paid monthly. Dividends are automatically
reinvested on payment dates in additional shares of the Company unless cash
payments are requested by writing to the Company. Shares purchased by wire
before 3:00 p.m. (Eastern time) begin earning dividends that day. Shares
purchased by check begin earning dividends the day after the check is converted
into federal funds.
CAPITAL GAINS
The Company does not expect to realize any capital gains or losses. If
capital gains or losses were to occur, they could result in an increase or
decrease in dividends. The Company will distribute in cash or additional
shares any realized net long-term capital gains at least once every 12
months.
ACCOUNT ACTIVITY
Shareholders will receive periodic statements reporting all account activity,
including dividends paid. The Company will not issue share certificates.
ACCOUNTS WITH LOW BALANCES
Due to the high cost of maintaining accounts with low balances, the Company may
redeem shares in any account, except accounts maintained by retirement plans,
and pay the proceeds to the shareholder if the account balance falls below a
required minimum value of $500 due to shareholder redemptions. Before shares are
redeemed to close an account, the shareholder is notified in writing and allowed
30 days to purchase additional shares to meet the minimum requirement.
VOTING RIGHTS
Each share of the Company owned by a shareholder gives that shareholder one vote
in Director elections and other matters submitted to shareholders for vote. The
Company is not required to hold annual shareholder meetings. Shareholder
approval will be sought only for certain changes in the Company's operation and
for election of Directors under certain circumstances.
Directors may be removed by the Directors or by shareholders at a special
meeting. A special meeting shall be called by the Directors upon the written
request of shareholders owning at least 10% of the outstanding shares of the
Company.
TAX INFORMATION
FEDERAL INCOME TAX
The Company will pay no federal income tax because it expects to meet
requirements of the Internal Revenue Code applicable to regulated investment
companies and to receive the special tax treatment afforded to such companies.
Unless otherwise exempt, shareholders are required to pay federal income tax on
any dividends and other distributions received. This applies whether dividends
and distributions are received in cash or as additional shares.
STATE AND LOCAL TAXES
Shareholders are urged to consult their own tax advisers regarding the status of
their accounts under state and local tax laws.
PERFORMANCE INFORMATION
From time to time, the Company advertises its yield, effective yield and total
return.
Yield represents the annualized rate of income earned on an investment over a
seven-day period. It is the annualized dividends earned during the period on an
investment shown as a percentage of the investment. The effective yield is
calculated similarly to the yield, but when annualized, the income earned by an
investment is assumed to be reinvested daily. The effective yield will be
slightly higher than the yield because of the compounding effect of this assumed
reinvestment.
Total return represents the change, over a specified period of time, in the
value of an investment in the Company after reinvesting all income
distributions. It is calculated by dividing that change by the initial
investment and is expressed as a percentage.
From time to time, advertisements for the Company may refer to ratings,
rankings, and other information in certain financial publications and/or compare
the Company's performance to certain indices.
PORTFOLIO OF INVESTMENTS
MONEY MARKET MANAGEMENT, INC.
DECEMBER 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
CERTIFICATES OF DEPOSIT--13.5%
BANKING--13.5%
$ 1,000,000 Bankers Trust Co., New York, 5.950%, 9/9/1998 $ 999,671
1,000,000 Royal Bank of Canada, Montreal, 6.200%, 4/6/1998 1,000,339
2,000,000 Sanwa Bank Ltd., Osaka, 6.190%, 1/20/1998 2,000,011
3,000,000 Societe Generale, Paris, 5.870% - 5.970%, 3/18/1998 - 3,000,073
10/14/1998
2,000,000 Sumitomo Bank Ltd., Osaka, 6.180%, 1/20/1998 2,000,011
2,000,000 Sumitomo Bank Ltd., Osaka, 5.810%, 1/23/1998 1,999,183
TOTAL CERTIFICATES OF DEPOSIT 10,999,288
(A)COMMERCIAL PAPER--8.6%
ELECTRIC POWER--2.2%
1,800,000 Southern Electric Generating Co. (SEGCO), (Guaranteed by
Alabama Power Co., Guaranteed by Georgia Power Co.), 5.980%,
1/13/1998 1,796,412
ENERGY MINERALS--1.0%
800,000 Occidental Petroleum Corp., 6.170%, 1/27/1998 796,435
FINANCE - AUTOMOTIVE--2.4%
2,000,000 Ford Motor Credit Corp., 5.580%, 1/16/1998 1,995,350
FINANCE - EQUIPMENT--1.0%
800,000 Comdisco, Inc., 6.000%, 3/13/1998 790,533
INDUSTRIAL PRODUCTS--1.0%
800,000 Praxair, Inc., 5.850%, 3/20/1998 789,860
INSURANCE--1.0%
800,000 CNA Financial Corp., 5.930%, 3/19/1998 789,853
TOTAL COMMERCIAL PAPER 6,958,443
(B)NOTES - VARIABLE--23.8%
BANKING--5.0%
2,000,000 Liquid Asset Backed Securities Trust, Series 1996-3,
(Westdeutsche Landesbank Girozentrale Swap Agreement), 6.000%,
1/15/1998 2,000,000
1,000,000 Long Lane Master Trust III, Series 1997-C, 5.780%, 1/2/1998 1,000,000
1,035,000 North Center Properties, (Huntington National Bank, Columbus,
OH LOC), 6.030%, 1/1/1998 1,035,000
TOTAL 4,035,000
FINANCE - COMMERCIAL--4.8%
Triangle Funding Ltd., 5.750%, 1/15/98 3,900,000
</TABLE>
MONEY MARKET MANAGEMENT, INC.
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
(B)NOTES - VARIABLE--CONTINUED
FINANCE - RETAIL--8.6%
$ 2,000,000 AFS Insurance Premium Receivables Trust, (Series 1994-A), $ 2,000,000
6.537%, 1/15/1998
2,000,000 Associates Corp. of North America, 6.170%, 1/2/1998 1,999,024
3,000,000 Carco Auto Loan Master Trust 1993-2, Class A1, 5.855%, 3,000,000
1/15/1998
TOTAL 6,999,024
INSURANCE--5.4%
3,500,000 General American Life Insurance Co., 6.141%, 1/21/1998 3,500,000
918,679 Liquid Asset Backed Securities Trust, Series 1997-3 Senior 918,679
Notes, (Guaranteed by AMBAC), 5.906%, 3/27/1998
TOTAL 4,418,679
TOTAL NOTES - VARIABLE 19,352,703
SHORT-TERM NOTES--24.2%
BANKING--4.9%
1,000,000 BankBoston, N.A., 6.020%, 10/21/1998 1,000,000
1,000,000 Bayerische Landesbank- NY, 6.250%, 4/15/1998 999,917
2,000,000 SALTS II Cayman Islands Corp., 1997-16 (Guaranteed by Bankers 2,000,000
Trust International) 5.988%, 3/19/1998
TOTAL 3,999,917
BROKERAGE--2.5%
2,000,000 Goldman Sachs & Co., 5.781%, 1/26/1998 2,000,000
FINANCE - AUTOMOTIVE--5.5%
182,174 Chase Manhattan Auto Owner Trust 1997-B, Class A-1, 5.744%, 182,174
7/10/1998
2,272,085 Ford Credit Auto Owner Trust 1997-B, Class A-1, 5.748%, 2,272,085
10/15/1998
2,000,000 Ford Motor Credit Corp., 6.420%, 2/4/1998 2,001,036
TOTAL 4,455,295
FINANCE - COMMERCIAL--7.9%
3,000,000 Beta Finance, Inc., 6.270%, 4/16/1998 3,000,000
1,150,000 CIT Group Holdings, Inc., 6.125%, 9/1/1998 1,151,661
1,100,000 CIT Group Holdings, Inc., 6.200%, 4/15/1998 1,101,244
1,200,000 CIT Group Holdings, Inc., 6.500%, 7/13/1998 1,204,159
TOTAL 6,457,064
FINANCE - EQUIPMENT--2.5%
2,000,000 Green Tree Lease Finance 1997-1 LLC, Class A-1, 5.906%, 2,000,000
1/23/1999
INSURANCE--0.9%
775,000 Transamerica Corp., 9.875%, 1/1/1998 775,000
TOTAL SHORT-TERM NOTES 19,687,276
</TABLE>
MONEY MARKET MANAGEMENT, INC.
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
(C)REPURCHASE AGREEMENTS--29.4%
$ 4,000,000 Fuji Government Securities, Inc., 6.600%, dated 12/31/1997, due $ 4,000,000
1/2/1998
3,900,000 HSBC Securities, Inc., 6.800%, dated 12/31/1997, due
1/2/1998 3,900,000 4,000,000 PaineWebber Group, Inc., 6.600%, dated
12/31/1997, due 1/2/1998 4,000,000 4,000,000 Societe Generale, New
York, 6.600%, dated 12/31/1997, due 4,000,000
1/2/1998
4,000,000 Swiss Bank Capital Markets, 6.550%, dated 12/31/1997, due 4,000,000
1/2/1998
4,000,000 UBS Securities, Inc., 6.800%, dated 12/31/1997, due 1/2/1998 4,000,000
TOTAL REPURCHASE AGREEMENTS 23,900,000
TOTAL INVESTMENTS (AT AMORTIZED COST)(D) $ 80,897,710
</TABLE>
(a) Each issue shows the rate of discount at the time of purchase for discount
issues, or the coupon for interest bearing issues.
(b) Floating rate note with current rate and next reset date shown.
(c) The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio. The
investments in the repurchase agreements are through participation in joint
accounts with other Federated funds.
(d) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($81,309,479) at December 31, 1997.
The following acronyms are used throughout this portfolio:
AMBAC --American Municipal Bond Assurance Corporation
LLC --Limited Liability Corporation
LOC --Letter of Credit
(See Notes which are an integral part of the Financial Statements)
STATEMENT OF ASSETS AND LIABILITIES
MONEY MARKET MANAGEMENT, INC.
DECEMBER 31, 1997
<TABLE>
<S> <C> <C>
ASSETS:
Investments in repurchase agreements $ 23,900,000
Investments in securities 56,997,710
Total investments in securities, at amortized cost and value $ 80,897,710
Income receivable 642,594
Receivable for shares sold 8,615
Total assets 81,548,919
LIABILITIES:
Payable for shares redeemed 22,796
Income distribution payable 24,044
Payable to Bank 135,544
Accrued expenses 57,056
Total liabilities 239,440
Net Assets for 81,309,479 shares outstanding $ 81,309,479
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PROCEEDS PER SHARE:
$81,309,479 / 81,309,479 shares outstanding $1.00
</TABLE>
(See Notes which are an integral part of the Financial Statements)
STATEMENT OF OPERATIONS
MONEY MARKET MANAGEMENT, INC.
YEAR ENDED DECEMBER 31, 1997
<TABLE>
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 4,928,360
EXPENSES:
Investment advisory fee $ 433,191
Administrative personnel and services fee 125,002
Custodian fees 17,369
Transfer and dividend disbursing agent fees and expenses 172,035
Directors'/Trustees' fees 12,235
Auditing fees 14,244
Legal fees 5,036
Portfolio accounting fees 42,561
Shareholder services fee 216,596
Share registration costs 20,243
Printing and postage 16,272
Insurance premiums 2,736
Miscellaneous 6,593
Total expenses 1,084,113
Waivers --
Waiver of investment advisory fee $ (14,375)
Waiver of shareholder services fee (112,630)
Total waivers (127,005)
Net expenses 957,108
Net investment income $ 3,971,252
</TABLE>
(See Notes which are an integral part of the Financial Statements)
STATEMENT OF CHANGES IN NET ASSETS
MONEY MARKET MANAGEMENT, INC.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS--
Net investment income $ 3,971,252 $ 4,503,969
DISTRIBUTIONS TO SHAREHOLDERS--
Distributions from net investment income (3,971,252) (4,503,969)
SHARE TRANSACTIONS--
Proceeds from sale of shares 128,239,157 121,628,840
Net asset value of shares issued to shareholders in payment of 3,647,147 4,216,111
distributions declared
Cost of shares redeemed (137,957,643) (139,854,088)
Change in net assets resulting from share transactions (6,071,339) (14,009,137)
Change in net assets (6,071,339) (14,009,137)
NET ASSETS:
Beginning of period 87,380,818 101,389,955
End of period $ 81,309,479 $ 87,380,818
</TABLE>
(See Notes which are an integral part of the Financial Statements)
NOTES TO FINANCIAL STATEMENTS
MONEY MARKET MANAGEMENT, INC.
DECEMBER 31, 1997
ORGANIZATION
Money Market Management, Inc. (the "Company") is registered under the Investment
Company Act of 1940, as amended (the "Act"), as an open-end management
investment company. The investment objective of the Company is to obtain current
income consistent with stability of principal.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Company in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATIONS The Company's use of the amortized cost method to
value its portfolio securities is in accordance with Rule 2a-7 under the Act.
REPURCHASE AGREEMENTS It is the policy of the Company to require the
custodian bank to take possession, to have legally segregated in the Federal
Reserve Book Entry System, or to have segregated within the custodian bank's
vault, all securities held as collateral under repurchase agreement
transactions. Additionally, procedures have been established by the Company to
monitor, on a daily basis, the market value of each repurchase agreement's
collateral to ensure that the value of collateral at least equals the repurchase
price to be paid under the repurchase agreement transaction.
The Company will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/ dealers, which are deemed by
the Company's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Directors (the "Directors").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Company could receive less
than the repurchase price on the sale of collateral securities. INVESTMENT
INCOME, EXPENSES, AND DISTRIBUTIONS
Interest income and expenses are accrued daily. Bond premium and discount, if
applicable, are amortized as required by the Internal Revenue Code, as amended
(the "Code"). Distributions to shareholders are recorded on the ex-dividend
date.
FEDERAL TAXES
It is the Company's policy to comply with the provisions of the Code applicable
to regulated investment companies and to distribute to shareholders each year
substantially all of its income. Accordingly, no provisions for federal tax are
necessary. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS The Company
may engage in when-issued or delayed delivery transactions. The Company records
when-issued securities on the trade date and maintains security positions such
that sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed delivery
basis are marked to market daily and begin earning interest on the settlement
date. USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts of assets, liabilities, expenses and revenues reported in the
financial statements. Actual results could differ from those estimated.
OTHER
Investment transactions are accounted for on the trade date.
CAPITAL STOCK
At December 31, 1997, there were 50,000,000,000 shares of $0.001 par value
capital stock authorized. Capital paid-in aggregated $81,309,479.
Transactions in capital stock were as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996
<S> <C> <C>
Shares sold 128,239,157 121,628,840
Shares issued to shareholders in payment of distributions declared 3,647,147 4,216,111
Shares redeemed (137,957,643) (139,854,088)
Net change resulting from share transactions (6,071,339) (14,009,137)
</TABLE>
INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE
Federated Advisers, the Company's investment adviser (the "Adviser"), receives
for its services an annual investment advisory fee based on the average daily
net assets of the Company as follows: 0.50% on the first $500 million, 0.475% on
the next $500 million, 0.45% on the next $500 million, 0.425% on the next $500
million, and 0.40% thereafter. The Adviser may voluntarily choose to waive any
portion of its fee. The Adviser can modify or terminate this voluntary waiver at
any time at its sole discretion.
ADMINISTRATIVE FEE
Federated Services Company ("FServ"), under the Administrative Services
Agreement, provides the Company with administrative personnel and services. The
fee paid to FServ is based on the level of average aggregate daily net assets of
all funds advised by subsidiaries of Federated Investors for the period. The
administrative fee received during the period of the Administrative Services
Agreement shall be at least $125,000 per portfolio and $30,000 per each
additional class of shares. SHAREHOLDER SERVICES FEE Under the terms of
a Shareholder Services Agreement with Federated Shareholder Services, the
Company will pay Federated Shareholder Services ("FSS") up to 0.25% of average
daily net assets of the Company for the period. The fee paid to FSS is used to
finance certain services for shareholders and to maintain shareholder accounts.
FSS may voluntarily choose to waive any portion of its fee. FSS can modify or
terminate this voluntary waiver at any time at its sole discretion.
TRANSFER AND DIVIDEND DISBURSING AGENT FEES AND EXPENSES
FServ, through its subsidiary, Federated Shareholder Services Company ("FSSC")
serves as transfer and dividend disbursing agent for the Fund. The fee paid to
FSSC is based on the size, type, and number of accounts and transactions made by
shareholders.
PORTFOLIO ACCOUNTING FEES
FServ maintains the Company's accounting records for which it receives a
fee. The fee is based on the level of the Company's average daily net assets
for the period, plus out-of-pocket expenses.
GENERAL
Certain of the Officers and Directors of the Company are Officers and
Directors or Trustees of the above companies.
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders of MONEY MARKET MANAGEMENT, INC.:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments of Money Market Management, Inc. as of December 31,
1997, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended December 31, 1997 and
1996, and the financial highlights for the periods presented. These financial
statements and financial highlights are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of the securities owned as of
December 31, 1997, by correspondence with the custodian and brokers; where
replies were not received, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position Money Market
Management, Inc. as of December 31, 1997, the results of its operations, the
changes in its net assets and its financial highlights for the respective stated
periods in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Pittsburgh, Pennsylvania
February 6, 1998
[Graphic]
FEDERATED INVESTORS
MONEY MARKET MANAGEMENT, INC.
PROSPECTUS
February 28, 1998
An Open-End, Diversified, Management
Investment Company
MONEY MARKET MANAGEMENT, INC.
FEDERATED INVESTORS FUNDS
5800 Corporate Drive
Pittsburgh, PA 15237-7000
DISTRIBUTOR
Federated Securities Corp.
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779
INVESTMENT ADVISER
Federated Advisers
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, PA 15222-3779
CUSTODIAN
State Street Bank and
Trust Company
P.O. Box 8600
Boston, MA 02266-8600
TRANSFER AGENT
AND DIVIDEND
DISBURSING AGENT
Federated Shareholder
Services Company
P.O. Box 8600
Boston, MA 02266-8600
INDEPENDENT PUBLIC ACCOUNTANTS Deloitte & Touche LLP 2500 One PPG Place
Pittsburgh, PA 15222-5401
Federated Securities Corp., Distributor
1-800-341-7400
www.FEDERATEDINVESTORS.COM
[Graphic]
Cusip 609346200
8012811A (2/98)
MONEY MARKET MANAGEMENT, INC.
STATEMENT OF ADDITIONAL INFORMATION
This Statement of Additional Information should be read with the prospectus of
Money Market Management, Inc. (the "Company") dated February 28, 1998. This
Statement is not a prospectus. You may request a copy of a prospectus or a paper
copy of this Statement, if you have received it electronically, free of charge
by calling 1-800-341-7400.
MONEY MARKET MANAGEMENT, INC.
FEDERATED INVESTORS FUNDS
5800 CORPORATE DRIVE
PITTSBURGH, PENNSYLVANIA 15237-7000
Statement dated February 28, 1998
[Graphic]
Cusip 609346200
8012811B (2/98)
[Graphic]
TABLE OF CONTENTS
INVESTMENT POLICIES 1 Acceptable Investments 1 U.S. Government Securities 1
Bank Instruments 1 Ratings 1 When-Issued and Delayed Delivery Transactions 1
Repurchase Agreements 1 Reverse Repurchase Agreements 2 Credit Enhancement 2
INVESTMENT LIMITATIONS 2 Selling Short and Buying on Margin 2 Borrowing Money 2
Pledging Assets 2 Lending Cash or Securities 2 Investing in Commodities and
Real Estate 2 Underwriting 2 Concentration of Investments 2 Diversification of
Investments 3 Investing in Restricted Securities 3 Investing in Securities of
Other Investment Companies 3 Investing for Control 3 Investing in Illiquid
Securities 3 Regulatory Compliance 3 MONEY MARKET MANAGEMENT, INC. MANAGEMENT 4
Share Ownership 7 Directors Compensation 8 Directors Liability 8 INVESTMENT
ADVISORY SERVICES 8 Investment Adviser 8 Advisory Fees 9 BROKERAGE TRANSACTIONS
9 OTHER SERVICES 9 Company Administration 9 Custodian and Portfolio
Recordkeeper 9 Transfer Agent 9 Independent Auditors 9 SHAREHOLDER SERVICES 10
DETERMINING NET ASSET VALUE 10 Exchanging Securities for Company Shares 10 Tax
Consequences 10 REDEMPTION IN KIND 11 THE COMPANY'S TAX STATUS 11 PERFORMANCE
INFORMATION 11 Yield 11 Effective Yield 11 Total Return 11 Performance
Comparisons 12 Economic and Market Information 12 ABOUT FEDERATED INVESTORS 12
Mutual Fund Market 13 Institutional Clients 13 Bank Marketing 13 Broker/Dealers
and Bank Broker/Dealer Subsidaries 13
INVESTMENT POLICIES
Unless indicated otherwise, the policies described below may not be changed by
the Board of Directors without shareholder approval.
ACCEPTABLE INVESTMENTS
When determining whether a security presents minimal credit risks, the
investment adviser will consider the creditworthiness of: the issuer of the
security; the issuer of any demand feature applicable to the security; or any
guarantor of either the security or any demand feature.
U.S. GOVERNMENT SECURITIES
The types of U.S. government securities in which the Company may invest
generally include direct obligations of the U.S. Treasury (such as U.S.
Treasury bills, notes, and bonds) and obligations issued or guaranteed by
U.S. government agencies or instrumentalities. These securities are backed
by:
* the full faith and credit of the U.S. Treasury;
* the issuer's right to borrow from the U.S. Treasury;
* the discretionary authority of the U.S. government to purchase certain
obligations of agencies or instrumentalities; or
* the credit of the agency or instrumentality issuing the obligations.
BANK INSTRUMENTS
The instruments of banks and savings associations whose deposits are insured by
the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF"), such as certificates of deposit, demand and time deposits, savings
shares, and bankers' acceptances, are not necessarily guaranteed by those
organizations. In addition to domestic bank instruments, the Company may invest
in: Eurodollar Certificates of Deposit issued by foreign branches of U.S. or
foreign banks; Eurodollar Time Deposits, which are U.S. dollar-denominated
deposits in foreign branches of U.S. or foreign banks; Canadian Time Deposits,
which are U.S. dollar-denominated deposits issued by branches of major Canadian
banks located in the United States; and Yankee Certificates of Deposit, which
are U.S. dollar-denominated certificates of deposit issued by U.S. branches of
foreign banks and held in the United States.
RATINGS
An NRSRO's two highest rating categories are determined without regard for
sub-categories and gradations. For example, securities rated A-1+, A-1, or A-2
by Standard & Poor's ("S&P"), Prime-1, or Prime-2 by Moody's Investors Service,
Inc. ("Moody's"), or F-1 (+ or -) or F -2 (+ or -) by Fitch IBCA, Inc. ("Fitch")
are all considered rated in one of the two highest short-term rating categories.
The Company will limit its investments in securities rated in the second highest
short-term rating category e.g., A-2 by S&P, Prime-2 by Moody's, or F-2 (+ or -)
by Fitch, to not more than 5% of its total assets, with not more than 1%
invested in the securities of any one issuer. The Company will follow applicable
regulations in determining whether a security rated by more than one NRSRO can
be treated as being in one of the two highest short-term rating categories;
currently, such securities must be rated by two NRSROs in one of their two
highest rating categories. See "Regulatory Compliance." WHEN-ISSUED AND
DELAYED DELIVERY TRANSACTIONS
These transactions are made to secure what is considered to be an advantageous
price or yield for the Company. No fees or other expenses, other than normal
transaction costs, are incurred. However, liquid assets of the Company
sufficient to make payment for the securities to be purchased are segregated on
the Company's records at the trade date. These assets are marked to market daily
and are maintained until the transaction has been settled. The Company does not
intend to engage in when-issued and delayed delivery transactions to an extent
that would cause the segregation of more than 20% of the total value of its
assets.
REPURCHASE AGREEMENTS
The Company believes that under the regular procedures normally in effect for
custody of the Company's portfolio securities subject to repurchase agreements,
a court of competent jurisdiction would rule in favor of the Company and allow
retention or disposition of such securities. The Company will only enter into
repurchase agreements with banks and other recognized financial institutions,
such as broker/dealers, which are deemed by the Company's adviser to be
creditworthy pursuant to guidelines established by the Directors.
REVERSE REPURCHASE AGREEMENTS
The Company may also enter into reverse repurchase agreements. These
transactions are similar to borrowing cash. In a reverse repurchase agreement,
the Company transfers possession of a portfolio instrument in return for a
percentage of the instrument's market value in cash and agrees that on a
stipulated date in the future the Company will repurchase the portfolio
instrument by remitting the original consideration plus interest at an
agreed-upon rate. The use of reverse repurchase agreements may enable the
Company to avoid selling portfolio instruments at a time when a sale may be
deemed to be disadvantageous, but does not ensure this result. However, liquid
assets of the Company, in a dollar amount sufficient to make payment for the
securities to be purchased, are: segregated on the Company's records at the
trade date; marked to market daily; and maintained until the transaction is
settled. CREDIT ENHANCEMENT
The Company typically evaluates the credit quality and ratings of
credit-enhanced securities based upon the financial condition and ratings of the
party providing the credit enhancement (the "credit enhancer"), rather than the
issuer. Generally, the Company will not treat credit-enhanced securities as
being issued by the credit enhancer for diversification purposes. However, under
certain circumstances applicable regulations may require the Company to treat
securities as having been issued by both the issuer and the credit enhancer.
INVESTMENT LIMITATIONS
SELLING SHORT AND BUYING ON MARGIN
The Company will not sell any securities short or purchase any securities on
margin.
BORROWING MONEY
The Company will not borrow money except as a temporary measure for
extraordinary purposes and then only in amounts not in excess of 5% of the value
of its net assets. In addition, the Company may enter into reverse repurchase
agreements and otherwise borrow up to one-third of the value of its total
assets, including the amount borrowed, in order to meet redemption requests
without immediately selling any portfolio instruments.
This latter practice is not for investment leverage but solely to facilitate
management of the portfolio by enabling the Company to meet redemption requests
when the liquidation of portfolio instruments would be inconvenient or
disadvantageous. Interest paid on borrowed funds will not be available for
investment. The Company may not purchase any portfolio instruments while any
borrowings (exclusive of reverse repurchase agreements) are outstanding.
PLEDGING ASSETS
The Company will not mortgage, pledge, or hypothecate any assets except as
necessary to secure permitted borrowings. In those cases, it may mortgage,
pledge or hypothecate assets having a market value not exceeding the lesser of
the dollar amounts borrowed or 10% of the value of total assets at the time of
the borrowing.
LENDING CASH OR SECURITIES
The Company will not lend any of its assets, except that it may purchase or hold
money market instruments permitted by its investment objective and policies.
INVESTING IN COMMODITIES AND REAL ESTATE
The Company will not invest in commodities, commodity contracts, or real estate,
except that it may purchase money market instruments issued by companies that
invest in real estate or interests in real estate.
UNDERWRITING
The Company will not act as underwriter of securities issued by others, except
as it may be deemed to be an underwriter under the Securities Act of 1933 in
connection with the sale of restricted securities which the Company may purchase
pursuant to its investment objective, policies, and limitations.
CONCENTRATION OF INVESTMENTS
The Company will not purchase money market instruments if, as a result of such
purchase, more than 25% of the value of its total assets would be invested in
any one industry. However, investing in bank instruments (such as time and
demand deposits and certificates of deposit), U.S. government obligations, or
instruments secured by these money market instruments, such as repurchase
agreements, shall not be considered investments in any one industry.
DIVERSIFICATION OF INVESTMENTS
The Company will not invest more than 5% of the value of its assets in
securities of any one issuer, except cash or cash items and U.S. government
obligations. With respect to 75% of the Company's assets, the Company will not
purchase securities other than repurchase agreements, issued by any one banking
institution having a value of more than 5% of the value of the Company's total
assets. INVESTING IN RESTRICTED SECURITIES
The Company will not invest more than 10% of its net assets in securities
subject to restrictions on resale under federal securities law (except for
commercial paper issued under Section 4(2) of the Securities Act of 1933).
INVESTING IN SECURITIES OF OTHER INVESTMENT COMPANIES
The Company will not invest in securities issued by any other investment
company.
INVESTING FOR CONTROL
The Company will not invest in securities of a company for the purpose of
exercising control or management.
The above limitations cannot be changed without shareholder approval. The
following investment limitation, however, may be changed by the Directors
without shareholder approval. Shareholders will be notified before any material
change in this limitation becomes effective.
INVESTING IN ILLIQUID SECURITIES
The Company will not invest more than 10% of the value of its net assets in
illiquid securities.
For purposes of the above limitations, the Company considers certificates of
deposit and demand and time deposits issued by a U.S. branch of a domestic bank
or savings association having capital, surplus, and undivided profits in excess
of $100,000,000 at the time of investment to be "cash items." Except with
respect to borrowing money, if a percentage limitation is adhered to at the time
of investment, a later increase or decrease in percentage resulting from any
change in value or net assets will not result in a violation of such limitation.
The Company did not borrow money or pledge securities in excess of 5% of the
value of its net assets during the last fiscal year and has no present intent to
do so during the coming fiscal year.
REGULATORY COMPLIANCE
The Company may follow non-fundamental operational policies that are more
restrictive than its fundamental investment limitations, as set forth in the
prospectus and this Statement of Additional Information, in order to comply with
applicable laws and regulations, including the provisions of and regulations
under the Investment Company Act of 1940. In particular, the Company will comply
with the various requirements of Rule 2a-7, which regulates money market mutual
funds. For example, with limited exceptions, Rule 2a-7 prohibits the investment
of more than 5% of the Company's total assets in the securities of any one
issuer, although the Company's investment limitation only requires such 5%
diversification with respect to 75% of its assets. The Company will invest more
than 5% of its assets in any one issuer only under the circumstances permitted
by Rule 2a-7. The Company will also determine the effective maturity of its
investments, as well as its ability to consider a security as having received
the requisite short-term ratings by NRSROs, according to Rule 2a-7. The Company
may change these operational policies to reflect changes in the laws and
regulations without the approval of its shareholders.
MONEY MARKET MANAGEMENT, INC. MANAGEMENT
Officers and Directors are listed with their addresses, birthdates, present
positions with Money Market Management, Inc., and principal occupations.
John F. Donahue@*
Federated Investors Tower
Pittsburgh, PA
Birthdate: July 28, 1924
Chairman and Director
Chairman and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; Chairman and Director, Federated
Research Corp. and Federated Global Research Corp.; Chairman, Passport
Research, Ltd.; Chief Executive Officer and Director or Trustee of the
Funds. Mr. Donahue is the father of J. Christopher Donahue, President and
Director of the Company.
J. Christopher Donahue*
Federated Investors Tower
Pittsburgh, PA
Birthdate: April 11, 1949
President and Director
President and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; President and Director, Federated
Research Corp. and Federated Global Research Corp.; President, Passport
Research, Ltd.; Trustee, Federated Shareholder Services Company and
Federated Shareholder Services; Director, Federated Services Company;
President or Executive Vice President of the Funds; Director or Trustee of
some of the Funds. Mr. Donahue is the son of John F. Donahue, Chairman and
Director of the Company.
Thomas G. Bigley
15 Old Timber Trail
Pittsburgh, PA
Birthdate: February 3, 1934
Director
Chairman of the Board, Children's Hospital of Pittsburgh; formerly, Senior
Partner, Ernst & Young LLP; Director, MED 3000 Group, Inc.; Director, Member
of Executive Committee, University of Pittsburgh; Director or Trustee of the
Funds.
John T. Conroy, Jr.
Wood/IPC Commercial Department
John R. Wood and Associates, Inc., Realtors
3255 Tamiami Trail North
Naples, FL
Birthdate: June 23, 1937
Director
President, Investment Properties Corporation; Senior Vice-President, John R.
Wood and Associates, Inc., Realtors; Partner or Trustee in private real
estate ventures in Southwest Florida; formerly, President, Naples Property
Management, Inc. and Northgate Village Development Corporation; Director or
Trustee of the Funds.
William J. Copeland
One PNC Plaza - 23rd Floor
Pittsburgh, PA
Birthdate: July 4, 1918
Director
Director and Member of the Executive Committee, Michael Baker, Inc.; formerly,
Vice Chairman and Director, PNC Bank, N.A., and PNC Bank Corp.; Director, Ryan
Homes, Inc.; Director or Trustee of the Funds.
James E. Dowd
571 Hayward Mill Road
Concord, MA
Birthdate: May 18, 1922
Director
Attorney-at-law; Director, The Emerging Germany Fund, Inc.; Director or
Trustee of the Funds.
Lawrence D. Ellis, M.D.*
3471 Fifth Avenue, Suite 1111
Pittsburgh, PA
Birthdate: October 11, 1932
Director
Professor of Medicine, University of Pittsburgh; Medical Director, University of
Pittsburgh Medical Center - Downtown; Member, Board of Directors, University of
Pittsburgh Medical Center; formerly, Hematologist, Oncologist, and Internist,
Presbyterian and Montefiore Hospitals; Director or Trustee of the Funds.
Edward L. Flaherty, Jr.@
Miller, Ament, Henny & Kochuba
205 Ross Street
Pittsburgh, PA
Birthdate: June 18, 1924
Director
Attorney of Counsel, Miller, Ament, Henny & Kochuba; Director, Eat'N Park
Restaurants, Inc.; formerly, Counsel, Horizon Financial, F.A., Western
Region; Director or Trustee of the Funds.
Peter E. Madden
One Royal Palm Way
100 Royal Palm Way
Palm Beach, FL
Birthdate: March 16, 1942
Director
Consultant; Former State Representative, Commonwealth of Massachusetts;
formerly, President, State Street Bank and Trust Company and State Street Boston
Corporation; Director or Trustee of the Funds.
John E. Murray, Jr., J.D., S.J.D.
President, Duquesne University
Pittsburgh, PA
Birthdate: December 20, 1932
Director
President, Law Professor, Duquesne University; Consulting Partner, Mollica &
Murray; Director or Trustee of the Funds.
Wesley W. Posvar
1202 Cathedral of Learning
University of Pittsburgh
Pittsburgh, PA
Birthdate: September 14, 1925
Director
Professor, International Politics; Management Consultant; Trustee, Carnegie
Endowment for International Peace, RAND Corporation, Online Computer Library
Center, Inc., National Defense University and U.S. Space Foundation;
President Emeritus, University of Pittsburgh; Founding Chairman, National
Advisory Council for Environmental Policy and Technology, Federal Emergency
Management Advisory Board and Czech Management Center, Prague; Director or
Trustee of the Funds.
Marjorie P. Smuts
4905 Bayard Street
Pittsburgh, PA
Birthdate: June 21, 1935
Director
Public Relations/Marketing/Conference Planning; Director or Trustee of the
Funds.
Edward C. Gonzales
Federated Investors Tower
Pittsburgh, PA
Birthdate: October 22, 1930
Executive Vice President
Vice Chairman, Treasurer, and Trustee, Federated Investors; Vice President,
Federated Advisers, Federated Management, Federated Research, Federated Research
Corp., Federated Global Research Corp. and Passport Research, Ltd.; Executive
Vice President and Director, Federated Securities Corp.; Trustee, Federated
Shareholder Services Company; Trustee or Director of some of the Funds;
President, Executive Vice President and Treasurer of some of the Funds.
John W. McGonigle
Federated Investors Tower
Pittsburgh, PA
Birthdate: October 26, 1938
Executive Vice President, Secretary and Treasurer
Executive Vice President, Secretary, and Trustee, Federated Investors; Trustee,
Federated Advisers, Federated Management, and Federated Research; Director,
Federated Research Corp. and Federated Global Research Corp.; Trustee, Federated
Shareholder Services Company; Director, Federated Services Company; President
and Trustee, Federated Shareholder Services; Director, Federated Securities
Corp.; Executive Vice President and Secretary of the Funds; Treasurer of some of
the Funds.
Richard B. Fisher
Federated Investors Tower
Pittsburgh, PA
Birthdate: May 17, 1923
Vice President
Executive Vice President and Trustee, Federated Investors; Chairman and
Director, Federated Securities Corp.; President or Vice President of some of
the Funds; Director or Trustee of some of the Funds.
* This Director is deemed to be an "interested person" as defined in the
Investment Company Act of 1940.
@ Member of the Executive Committee. The Executive Committee of the Board of
Directors handles the responsibilities of the Board between meetings of the
Board.
As referred to in the list of Directors and Officers, "Funds" includes the
following investment companies:
111 Corcoran Funds; Automated Government Money Trust; Blanchard Funds; Blanchard
Precious Metals Fund, Inc.; Cash Trust Series II; Cash Trust Series, Inc.; DG
Investor Series; Edward D. Jones & Co. Daily Passport Cash Trust; Federated
Adjustable Rate U.S. Government Fund, Inc.; Federated American Leaders Fund,
Inc.; Federated ARMs Fund; Federated Equity Funds; Federated Equity Income Fund,
Inc.; Federated Fund for U.S. Government Securities, Inc.; Federated GNMA Trust;
Federated Government Income Securities, Inc.; Federated Government Trust;
Federated High Income Bond Fund, Inc.; Federated High Yield Trust; Federated
Income Securities Trust; Federated Income Trust; Federated Index Trust;
Federated Institutional Trust; Federated Insurance Series; Federated Investment
Portfolios; Federated Investment Trust; Federated Master Trust; Federated
Municipal Opportunities Fund, Inc.; Federated Municipal Securities Fund, Inc.;
Federated Municipal Trust; Federated Short-Term Municipal Trust; Federated
Short-Term U.S. Government Trust; Federated Stock and Bond Fund, Inc.; Federated
Stock Trust; Federated Tax-Free Trust; Federated Total Return Series, Inc.;
Federated U.S. Government Bond Fund; Federated U.S. Government Securities Fund:
1-3 Years; Federated U.S. Government Securities Fund: 2-5 Years; Federated U.S.
Government Securities Fund: 5-10 Years; Federated Utility Fund, Inc.; First
Priority Funds; Fixed Income Securities, Inc.; High Yield Cash Trust;
Intermediate Municipal Trust; International Series, Inc.; Investment Series
Funds, Inc.; Investment Series Trust; Liberty Term Trust, Inc.--1999; Liberty
U.S. Government Money Market Trust; Liquid Cash Trust; Managed Series Trust;
Money Market Management, Inc.; Money Market Obligations Trust; Money Market
Obligations Trust II; Money Market Trust; Municipal Securities Income Trust;
Newpoint Funds; RIMCO Monument Funds; Targeted Duration Trust; Tax-Free
Instruments Trust; The Planters Funds; The Virtus Funds; Trust for Financial
Institutions; Trust for Government Cash Reserves; Trust for Short-Term U.S.
Government Securities; Trust for U.S. Treasury Obligations; Wesmark Funds; WCT
Funds; and World Investment Series, Inc.
SHARE OWNERSHIP
Officers and Directors as a group own less than 1% of the Company.
DIRECTORS COMPENSATION
AGGREGATE
NAME, COMPENSATION
POSITION WITH FROM TOTAL COMPENSATION PAID
TRUST TRUST*# FROM FUND COMPLEX+
John F. Donahue $-0- $0 for the Company and
Chairman and Director 56 other investment companies in
the Fund Complex
J. Christopher Donahue $-0- $0 for the Company and
President and Director 18 other investment companies in
the Fund Complex
Thomas G. Bigley++ $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
John T. Conroy, Jr. $1,181.00 $122,362 for the Company and
Director 56 other investment companies in
the Fund Complex
William J. Copeland $1,181.00 $122,362 for the Company and
Director 56 other investment companies in
the Fund Complex
James E. Dowd $1,181.00 $122,362 for the Company and
Director 56 other investment companies in
the Fund Complex
Lawrence D. Ellis, M.D. $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
Edward L. Flaherty, Jr. $1,181.00 $122,362 for the Company and
Director 56 other investment companies in
the Fund Complex
Peter E. Madden $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
John E. Murray, Jr. $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
Wesley W. Posvar $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
Marjorie P. Smuts $1,073.00 $111,222 for the Company and
Director 56 other investment companies in
the Fund Complex
* Information is furnished for the fiscal year ended December 31, 1997.
+ The information is provided for the last calendar year.
++ Mr. Bigley served on 39 investment companies in the Federated Funds Complex
from January 1 through September 30, 1995. On October 1, 1995, he was appointed
a Trustee on 15 additional Federated Funds.
DIRECTORS LIABILITY
The Articles of Incorporation provide that the Directors will not be liable for
errors of judgment or mistakes of fact or law. However, they are not protected
against any liability to which they would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of their office.
INVESTMENT ADVISORY SERVICES
INVESTMENT ADVISER
The Company's investment adviser is Federated Advisers. It is a subsidiary of
Federated Investors. All the voting securities of Federated Investors are owned
by a trust, the trustees of which are John F. Donahue, his wife and his son, J.
Christopher Donahue. The adviser shall not be liable to the Money Market
Management, Inc. or any shareholder for any losses that may be sustained in the
purchase, holding, or sale of any security or for anything done or omitted by
it, except acts or omissions involving willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties imposed upon it by its contract
with the Money Market Management, Inc. ADVISORY FEES For its advisory
services, Federated Advisers receives an annual investment advisory fee as
described in the prospectus. For the fiscal years ended December 31, 1997, 1996,
and 1995, the adviser earned $433,191, $504,804, and $519,840, respectively, of
which $14,375, $0, and $0, respectively, were waived. BROKERAGE
TRANSACTIONS When selecting brokers and dealers to handle the purchase and
sale of portfolio instruments, the adviser looks for prompt execution of the
order at a favorable price. In working with dealers, the adviser will generally
use those who are recognized dealers in specific portfolio instruments, except
when a better price and execution of the order can be obtained elsewhere. The
adviser makes decisions on portfolio transactions and selects brokers and
dealers subject to guidelines established by the Directors. The adviser may
select brokers and dealers who offer brokerage and research services. These
services may be furnished directly to the Company or to the adviser and may
include: advice as to the advisability of investing in securities; security
analysis and reports; economic studies; industry studies; receipt of quotations
for portfolio evaluations; and similar services. Research services provided by
brokers and dealers may be used by the adviser or its affiliates in advising the
Company and other accounts. To the extent that receipt of these services may
supplant services for which the adviser or its affiliates might otherwise have
paid, it would tend to reduce their expenses. The adviser and its affiliates
exercise reasonable business judgment in selecting brokers who offer brokerage
and research services to execute securities transactions. They determine in good
faith that commissions charged by such persons are reasonable in relationship to
the value of the brokerage and research services provided. During the fiscal
year(s) ended December 31, 1997, 1996, and 1995, the Company paid total
brokerage commissions of 0, 0, and 0, respectively. Although investment
decisions for the Company are made independently from those of the other
accounts managed by the adviser, investments of the type the Company may make
may also be made by those other accounts. When the Company and one or more other
accounts managed by the adviser are prepared to invest in, or desire to dispose
of, the same security, available investments or opportunities for sales will be
allocated in a manner believed by the adviser to be equitable to each. In some
cases, this procedure may adversely affect the price paid or received by the
Company or the size of the position obtained or disposed of by the Company. In
other cases, however, it is believed that coordination and the ability to
participate in volume transactions will be to the benefit of the Company.
OTHER SERVICES
COMPANY ADMINISTRATION
Federated Services Company, a subsidiary of Federated Investors, provides
administrative personnel and services to the Company for a fee as described in
the prospectus. From March 1, 1994 to March 1, 1996, Federated Administrative
Services served as the Company's Administrator. Prior to March 1, 1994,
Federated Administrative Services, Inc. served as the Company's Administrator.
Both former Administrators are subsidiaries of Federated Investors. For purposes
of this Statement of Additional information, Federated Services Company,
Federated Administrative Services and Federated Administrative Services, Inc.
may hereinafter collectively be referred to as the "Administrators." For the
fiscal year ended December 31, 1997, 1996, and 1995, the Administrators earned
$125,002, $125,000, and $125,002 respectively.
CUSTODIAN AND PORTFOLIO RECORDKEEPER
State Street Bank and Trust Company, Boston, Boston, MA, is custodian for the
securities and cash of the Company. Federated Services Company, Pittsburgh, PA
provides certain accounting and recordkeeping services with respect to the
Company's portfolio investments. The fee paid for this service is based upon the
level of the Company's average net assets for the period plus out-of-pocket
expenses.
TRANSFER AGENT
Federated Services Company, through its registered transfer agent, Federated
Shareholder Services Company maintains all necessary shareholder records. For
its services, the transfer agent receives a fee based on the number of
shareholder accounts.
INDEPENDENT AUDITORS
The independent auditors for the Company are Deloitte & Touche LLP, Pittsburgh,
PA.
SHAREHOLDER SERVICES
This arrangement permits the payment of fees to Federated Shareholder Services
and financial institutions to cause services to be provided which are necessary
for the maintenance of shareholder accounts and to encourage personal services
to shareholders by a representative who has knowledge of the shareholder's
particular circumstances and goals. These activities and services may include
but are not limited to providing office space, equipment, telephone facilities,
and various clerical, supervisory, computer, and other personnel as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries; and assisting
clients in changing dividend options, account designations, and addresses.
By adopting the Shareholder Services Agreement, the Directors expect that the
Company will benefit by: (1) providing personal services to shareholders; (2)
investing shareholder assets with a minimum of delay and administrative detail;
(3) enhancing shareholder recordkeeping systems; and (4) responding promptly to
shareholders' requests and inquiries concerning their accounts. For the
fiscal year ended December 31, 1997, payments in the amount of $216,596 were
made pursuant to the Shareholder Services Agreement, $112,630 of which was
waived. DETERMINING NET ASSET VALUE
The Directors have decided that the best method for determining the value of
portfolio instruments is amortized cost. Under this method, portfolio
instruments are valued at the acquisition cost as adjusted for amortization of
premium or accumulation of discount rather than at current market value.
Accordingly, neither the amount of daily income nor the net asset value is
affected by any unrealized appreciation or depreciation of the portfolio. In
periods of declining interest rates, the indicated daily yield on shares of the
Company computed by dividing the annualized daily income on the Company's
portfolio by the net asset value computed as above may tend to be higher than a
similar computation made by using a method of valuation based upon market prices
and estimates. In periods of rising interest rates, the opposite may be true.
The Company's use of the amortized cost method of valuing portfolio instruments
depends on its compliance with certain conditions in Rule 2a-7 (the "Rule")
promulgated by the Securities and Exchange Commission under the Investment
Company Act of 1940. Under the Rule, the Directors must establish procedures
reasonably designed to stabilize the net asset value per share, as computed for
purposes of distribution and redemption, at $1.00 per share, taking into account
current market conditions and the Company's investment objective. The procedures
include monitoring the relationship between the amortized cost value per share
and the net asset value per share based upon available indications of market
value. The Directors will decide what, if any, steps should be taken if there is
a difference of more than 0.5 of 1% between the two values. The Directors will
take any steps they consider appropriate (such as redemption in kind or
shortening the average portfolio maturity) to minimize any material dilution or
other unfair results arising from differences between the two methods of
determining net asset value.
EXCHANGING SECURITIES FOR COMPANY SHARES
Any Securities to be exchanged must meet the investment objective and policies
of the Company, must have a readily ascertainable market value, must be liquid,
and must not be subject to restrictions on resale. An investor should forward
the securities in negotiable form with an authorized letter of transmittal to
Federated Advisors. The Company will notify the investor of its acceptances and
valuation of the securities within five business days of their receipt. The
basis of the exchange will depend upon the net asset value of the Company shares
on the day the securities are valued. One share of the Company will be issued
for each equivalent amount of securities accepted. Any interest earned on the
securities prior to exchange will be considered in valuing securities. All
interest, dividends, subscriptions, conversions, or other rights attached to the
securities become the property of the Company along with the securities.
TAX CONSEQUENCES
Exercise of this exchange privilege is currently treated as a sale for federal
income tax purposes. Depending upon the cost basis of the securities exchanged
for Company shares, a gain or loss may be realized by the investor.
REDEMPTION IN KIND
The Company is obligated to redeem shares solely in cash up to $250,000 or 1% of
the Company's net asset value, whichever is less, for any one shareholder within
a 90-day period. Any redemption beyond this amount will also be in cash unless
the Directors determine that further payments should be in kind. In such cases,
the Company will pay all or a portion of the remainder of the redemption in
portfolio instruments valued in the same way as the Company determines net asset
value. The portfolio instruments will be selected in a manner that the Directors
deem fair and equitable. Redemption in kind is not as liquid as a cash
redemption. If redemption is made in kind, shareholders who sell these
securities could receive less than the redemption value and could incur certain
transaction costs.
THE COMPANY'S TAX STATUS
To qualify for the special tax treatment afforded to regulated investment
companies, the Company must, among other requirements: derive at least 90% of
its gross income from dividends, interest, and gains from the sale of
securities; invest in securities within certain statutory limits; and distribute
to its shareholders at least 90% of its net income earned during the year.
PERFORMANCE INFORMATION
Performance depends upon such variables as: portfolio quality; average portfolio
maturity; type of instruments in which the portfolio is invested; changes in
interest rates; changes in expenses; and the relative amount of cash flow. To
the extent that financial institutions and broker/dealers charge fees in
connection with services provided in conjunction with an investment in shares of
the Company, the performance will be reduced for those shareholders paying those
fees.
YIELD
The yield is calculated based upon the seven days ending on the day of the
calculation, called the "base period." This yield is computed by: determining
the net change in the value of a hypothetical account with a balance of one
share at the beginning of the base period, with the net change excluding capital
changes but including the value of any additional shares purchased with
dividends earned from the original one share and all dividends declared on the
original and any purchased shares; dividing the net change in the account's
value by the value of the account at the beginning of the base period to
determine the base period return; and multiplying the base period return by
365/7. The Company's yield for the seven-day period ended December 31, 1997,
was 4.81%. EFFECTIVE YIELD The effective yield is calculated by
compounding the unannualized base period return by: adding 1 to the base period
return; raising the sum to the 365/7th power; and subtracting 1 from the result.
The Company's effective yield for the seven-day period ended December 31, 1997,
was 4.92%. TOTAL RETURN
Average annual total return is the average compounded rate of return for a given
period that would equate a $1,000 initial investment to the ending redeemable
value of that investment. The ending redeemable value is computed by multiplying
the number of shares owned at the end of the period by the net asset value per
share at the end of the period. The number of shares owned at the end of the
period is based on the number of shares purchased at the beginning of the period
with $1,000, adjusted over the period by any additional shares, assuming the
monthly reinvestment of all dividends and distributions. The Company's
average annual total returns for the one-five-and ten year period ended December
31, 1997 were 4.69%, 4.79%, and 7.24%, respectively. PERFORMANCE
COMPARISONS
Investors may use financial publications and/or indices to obtain a more
complete view of the Company's performance. When comparing performance,
investors should consider all relevant factors such as the composition of any
index used, prevailing market conditions, portfolio compositions of other funds,
and methods used to value portfolio securities and compute offering price. The
financial publications and/or indices which the Company uses in advertising may
include:
* LIPPER ANALYTICAL SERVICES, INC., ranks funds in various fund categories
based on total return, which assumes the reinvestment of all income
dividends and capital gains distributions, if any.
* IBC/DONOGHUE'S MONEY FUND REPORT publishes annualized yields of money
market funds weekly. Donoghue's Money Market Insight publication reports
monthly and 12-month-to-date investment results for the same money funds.
* MONEY, a monthly magazine, regularly ranks money market funds in various
categories based on the latest available seven-day effective yield.
* BANK RATE MONITOR(C) NATIONAL INDEX, MIAMI BEACH, FLORIDA, published
weekly, is an average of the interest rates of personal money market
deposit accounts at ten of the largest banks and thrifts in each of the
five largest Standard Metropolitan Statistical Areas. If more than one rate
is offered, the lowest rate is used. Account minimums and compounding
methods may vary.
Advertising and other promotional literature may include charts, graphs and
other illustrations using the Company's returns, or returns in general, that
demonstrate basic investment concepts such as tax-deferred compounding,
dollar-cost averaging and systematic investment. In addition, the Company can
compare its performance, or performance for the types of securities in which it
invests, to a variety of other investments, such as bank savings accounts,
certificates of deposit, and Treasury bills.
ECONOMIC AND MARKET INFORMATION
Advertising and sales literature for the Company may include discussions of
economic, financial and political developments and their effect on the
securities market. Such discussions may take the form of commentary on these
developments by portfolio managers and their views and analysis on how such
developments could affect the funds. In addition, advertising and sales
literature may quote statistics and give general information about the mutual
fund industry, including the growth of the industry, from sources such as the
Investment Company Institute. ABOUT FEDERATED INVESTORS
Federated Investors is dedicated to meeting investor needs which is reflected in
its investment decision making --structured, straightforward, and consistent.
This has resulted in a history of competitive performance with a range of
competitive investment products that have gained the confidence of thousands of
clients and their customers.
The company's disciplined security selection process is firmly rooted in sound
methodologies backed by fundamental and technical research. Investment decisions
are made and executed by teams of portfolio managers, analysts, and traders
dedicated to specific market sectors. These traders handle trillions of dollars
in annual trading volume. In the money market sector, Federated Investors
gained prominence in the mutual fund industry in 1974 with the creation of the
first institutional money market fund. Simultaneously, the company pioneered the
use of the amortized cost method of accounting for valuing shares of money
market funds, a principal means used by money managers today to value money
market fund shares. Other innovations include the first institutional tax-free
money market fund. As of December 31, 1997, Federated Investors managed more
than $63.1 billion in assets across 51 money market funds, including 18
government, 11 prime and 22 municipal with assets approximating $35 billion,
$17.1 billion and $10.9 billion, respectively.
J. Thomas Madden, Executive Vice President, oversees Federated Investors' equity
and high yield corporate bond management while William D. Dawson, Executive Vice
President, oversees Federated Investors' domestic fixed income management. Henry
A. Frantzen, Executive Vice President, oversees the management of Federated
Investors' international and global portfolios.
MUTUAL FUND MARKET
Thirty-seven percent of American households are pursuing their financial goals
through mutual funds. These investors, as well as businesses and institutions,
have entrusted over $4.4 trillion to the more than 6,700 funds available.*
Federated Investors, through its subsidiaries, distributes mutual funds for a
variety of investment applications. Specific markets include:
INSTITUTIONAL CLIENTS
Federated Investors meets the needs of approximately 900 institutional clients
nationwide by managing and servicing separate accounts and mutual funds for a
variety of applications, including defined benefit and defined contribution
programs, cash management, and asset/liability management. Institutional clients
include corporations, pension funds, tax-exempt entities,
foundations/endowments, insurance companies, and investment and financial
advisors. The marketing effort to these institutional clients is headed by John
B. Fisher, President, Institutional Sales Division.
BANK MARKETING
Other institutional clients include close relationships with more than 1,600
banks and trust organizations. Virtually all of the trust divisions of the top
100 bank holding companies use Federated funds in their clients' portfolios. The
marketing effort to trust clients is headed by Timothy C. Pillion, Senior Vice
President, Bank Marketing & Sales.
BROKER/DEALERS AND BANK BROKER/DEALER SUBSIDIARIES
Federated funds are available to consumers through major brokerage firms
nationwide--we have over 2,200 broker/dealer and bank broker/dealer
relationships across the country--supported by more wholesalers than any other
mutual fund distributor. Federated's service to financial professionals and
institutions has earned it high ratings in several surveys performed by DALBAR,
Inc. DALBAR is recognized as the industry benchmark for service quality
measurement. The marketing effort to these firms is headed by James F. Getz,
President, Federated Securities Corp.
*Source: Investment Company Institute
PART C. OTHER INFORMATION.
Item 24. Financial Statements and Exhibits:
(a) Financial Statements (Filed in Part A).
(b) Exhibits:
(1) Conformed copy of Articles of Incorporation of the
Registrant (8); (2) Copy of By-Laws of the Registrant, as
amended (4); (3) Not applicable; (4) Copy of Specimen
Certificate for Shares of Common Stock of the Registrant (9);
(5) Conformed copy of Investment Advisory Contract of the
Registrant (9); (6) (i) Conformed copy of Distributor's
Contract of the Registrant (9);
(ii) The Registrant hereby incorporates the conformed
copy of the specimen Mutual Funds Sales and Service
Agreement; Mutual Funds Service Agreement and Plan
Trustee/Mutual Funds Service Agreement from Item 24(b)6
of the Cash Trust Series II Registration Statement on
Form N-1A, filed with the Commission on July 24, 1995.
(File Nos. 33-38550 and 811-6269)
(7) Not applicable;
(8) Conformed copy of Custodian Agreement of the
Registrant (10);
(9) (i) Conformed Copy of Agreement for Fund Accounting,
Shareholder Recordkeeping, and Custody Services
Procurement of the Registrant(10);
(ii) Conformed Copy of Shareholder Services
Agreement (10);
(iii) The responses described in Item 24(6)(ii) are
hereby incorporated by reference. (10) Not applicable; (11)
Conformed copy of Consent of Independent Public Accountants ;+
(12) Not applicable; (13) Conformed copy of Initial
Capitalization
Letter (9);
(14) Not applicable;
(15) Not applicable;
(16) Copy of Schedule for Computation of Yield
Calculation (5);
+ All exhibits have been filed electronically.
4. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 57 on Form N-1A filed February 19, 1988. (File Nos. 2-49591
and 811-2430)
5. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 59 on Form N-1A filed February 23, 1989. (File Nos. 2-49591
and 811-2430)
8. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 68 on Form N-1A filed February 25, 1993. (File Nos. 2-49591
and 811-2430)
9. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 70 on Form N-1A filed February 24, 1994. (File Nos. 2-49591
and 811-2430)
10. Response is incorporated by reference to Registrant's Post- Effective
Amendment No. 74 on Form N-1A filed February 29, 1996. (File Nos. 2-49591
and 811-2430)
<PAGE>
(17) Copy of Financial Data Schedule; +
(18) Not applicable;
(19) Conformed copy of Power of Attorney. (11)
Item 25. Persons Controlled by or Under Common Control with Registrant:
None
Item 26. Number of Holders of Securities:
Number of Record Holders
Title of Class as of February 3, 1998_
Shares of Capital Stock 7,371
(par value $0.001 per share)
Item 27. Indemnification: (9):
Item 28. Business and Other Connections of Investment Adviser:
For a description of the other business of Federated Administrative
Services, the investment adviser for Government Obligations Tax-Managed
Fund, see the section entitled "Fund Information - Management of the
Fund" in Part A. The affiliations with the Registrant of two of the
Trustees of Federated Administrative Services are included in Part B of
this Registration Statement under "Money Market Obligations Trust
Management." The remaining Trustees of Federated Administrative
Services, their principal occupations and business addresses are: Mark
D. Olson (Partner, Wilson, Halbrook & Bayard), 107 W. Market Street,
Georgetown, Delaware 19947, and Arthur L. Cherry (President, Chief
Executive Officer, and Trustee, Federated Services Company; Director,
Edgewood Services, Inc.; Trustee, Advanced Information Systems;
President and Director, Federated Administrative Services, Inc.;
President, Federated Administrative Services; Trustee, Federated Bank
and Trust; President and Trustee, Federated Shareholder Services
Company; President and Director, FS Holdings, Inc.; Chairman and
Trustee, Retirement Plan Service Company of America), Federated
Investors Tower, Pittsburgh, Pennsylvania, 15222-3779. From 1994 to
January 27, 1997, Mr. Cherry was Managing Partner, AT&T Solutions.
+ All exhibits have been filed electronically.
9. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 70 on Form N-1A filed February 24, 1994. (File Nos. 2-49591
and 811-2430)
11. Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 76 filed February 26, 1997. (File Nos. 2-49591 and 811-2430)
<PAGE>
The remaining Officers of Federated Administrative Services are:
President: Arthur L. Cherry
Senior Vice Presidents: S. Elliott Cohan
Emily H. Emigh
Ronald M. Petnuch
Thomas J. Ward
Vice Presidents: Debbie Adams-Marshall
C. Grant Anderson
Keith A. Antle
F. Jefferson Bragdon
Gail Cagney
Charles L. Davis, Jr.
Peter J. Germain
Michael L. Guzzi
J. Crilley Kelly
Dennis M. Laffey
Joseph S. Machi
Diane M. Marzula
Jay S. Neuman
Kenneth W. Pegher
J. David Richter
Melinda Schmidt
Thomas P. Sholes
Victor R. Siclari
Jeffrey W. Sterling
Richard J. Thomas
C. Christine Thomson
Assistant Vice Presidents: Anthony R. Bosch
Karen M. Brownlee
Mark Crowley
Gerald P. DiMarco
C. Todd Gibson
Timothy S. Johnson
Judy Mackin
Deborah M. Molini
Donna J. Padezan
Leslie C. Petrone
James R. Risbon
Secretary: Thomas J. Ward
Treasurer: Lawrence Caracciolo
Assistant Secretary: S. Elliott Cohan
The business address of each of the Officers of Federated
Administrative Services is Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779.
<PAGE>
Item 29. Principal Underwriters:
(a)...Federated Securities Corp. the Distributor for shares of the
Registrant, acts as principal underwriter for the
following open-end investment companies, including the Registrant:
111 Corcoran Funds; Automated Government Money Trust; Blanchard Funds; Blanchard
Precious Metals Fund, Inc.; Cash Trust Series II; Cash Trust Series, Inc.; DG
Investor Series; Edward D. Jones & Co. Daily Passport Cash Trust; Federated
Adjustable Rate U.S. Government Fund, Inc.; Federated American Leaders Fund,
Inc.; Federated ARMs Fund; Federated Core Trust; Federated Equity Funds;
Federated Equity Income Fund, Inc.; Federated Fund for U.S. Government
Securities, Inc.; Federated GNMA Trust; Federated Government Income Securities,
Inc.; Federated Government Trust; Federated High Income Bond Fund, Inc.;
Federated High Yield Trust; Federated Income Securities Trust; Federated Income
Trust; Federated Index Trust; Federated Institutional Trust; Federated Insurance
Series; Federated Investment Portfolios; Federated Investment Trust; Federated
Master Trust; Federated Municipal Opportunities Fund, Inc.; Federated Municipal
Securities Fund, Inc.; Federated Municipal Trust; Federated Short-Term Municipal
Trust; Federated Short-Term U.S. Government Trust; Federated Stock and Bond
Fund, Inc.; Federated Stock Trust; Federated Tax-Free Trust; Federated Total
Return Series, Inc.; Federated U.S. Government Bond Fund; Federated U.S.
Government Securities Fund: 1-3 Years; Federated U.S. Government Securities
Fund: 2-5 Years; Federated U.S. Government Securities Fund: 5-10 Years;
Federated Utility Fund, Inc.; First Priority Funds; Fixed Income Securities,
Inc.; High Yield Cash Trust; Independence One Mutual Funds; Intermediate
Municipal Trust; International Series, Inc.; Investment Series Funds, Inc.;
Investment Series Trust; Liberty U.S. Government Money Market Trust; Liquid Cash
Trust; Managed Series Trust; Marshall Funds, Inc.; Money Market Management,
Inc.; Money Market Obligations Trust; Money Market Obligations Trust II; Money
Market Trust; Municipal Securities Income Trust; Newpoint Funds; Peachtree
Funds; RIMCO Monument Funds; SouthTrust Vulcan Funds; Star Funds; Targeted
Duration Trust; Tax-Free Instruments Trust; The Planters Funds; The Virtus
Funds; The Wachovia Funds; The Wachovia Municipal Funds; Tower Mutual Funds;
Trust for Financial Institutions; Trust for Government Cash Reserves; Trust for
Short-Term U.S. Government Securities; Trust for U.S. Treasury Obligations;
Vision Group of Funds, Inc.; and World Investment Series, Inc.
Federated Securities Corp. also acts as principal underwriter for the
following closed-end investment company: Liberty Term Trust, Inc.- 1999.
<PAGE>
(b)
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Richard B. Fisher Director, Chairman, Chief Vice President
Federated Investors Tower Executive Officer, Chief
Pittsburgh, PA 15222-3779 Operating Officer, Asst.
Secretary and Asst.
Treasurer, Federated
Securities Corp.
Edward C. Gonzales Director, Executive Vice Executive Vice
Federated Investors Tower President, Federated, President
Pittsburgh, PA 15222-3779 Securities Corp.
Thomas R. Donahue Director, Assistant Secretary --
Federated Investors Tower and Assistant Treasurer
Pittsburgh, PA 15222-3779 Federated Securities Corp
James F. Getz President-Broker/Dealer, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John B. Fisher President-Institutional Sales, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
David M. Taylor Executive Vice President --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark W. Bloss Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard W. Boyd Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Laura M. Deger Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Theodore Fadool, Jr. Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Bryant R. Fisher Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Christopher T. Fives Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James S. Hamilton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James M. Heaton Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Keith Nixon Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Solon A. Person, IV Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Timothy C. Pillion Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Thomas E. Territ Senior Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Teresa M. Antoszyk Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John B. Bohnet Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Byron F. Bowman Vice President, Secretary, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jane E. Broeren-Lambesis Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mary J. Combs Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
R. Edmond Connell, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
R. Leonard Corton, Jr. Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Kevin J. Crenny Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Daniel T. Culbertson Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
G. Michael Cullen Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
William C. Doyle Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
<PAGE>
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Jill Ehrenfeld Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark D. Fisher Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Joseph D. Gibbons Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John K. Goettlicher Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Craig S. Gonzales Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard C. Gonzales Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Bruce E. Hastings Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Beth A. Hetzel Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
James E. Hickey Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Brian G. Kelly Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
H. Joseph Kennedy Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Mark J. Miehl Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard C. Mihm Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
J. Michael Miller Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Thomas A. Peters III Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
<PAGE>
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Robert F. Phillips Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard A. Recker Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Eugene B. Reed Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
George D. Riedel Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Paul V. Riordan Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John Rogers Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Brian S. Ronayne Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Thomas S. Schinabeck Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Edward L. Smith Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
David W. Spears Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John A. Staley Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Jeffrey A. Stewart Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard Suder Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
William C. Tustin Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Paul A. Uhlman Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Miles J. Wallace Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
John F. Wallin Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Richard B. Watts Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Edward J. Wojnarowski Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Michael P. Wolff Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Edward R. Bozek Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Terri E. Bush Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Beth C. Dell Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Charlene H. Jennings Assistant Vice President, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Denis McAuley Treasurer, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
Leslie K. Platt Assistant Secretary, --
Federated Investors Tower Federated Securities Corp.
Pittsburgh, PA 15222-3779
(c) Not applicable.
Item 30. Location of Accounts and Records:
Money Market Management, Inc. Federated Investors Funds
5800 Corporate Drive
(Registrant) Pittsburgh, PA 15237-7000
Federated Shareholder
Services Company P.O. Box 8600
(Transfer Agent and Dividend Boston, MA 02266-8600
Disbursing Agent)
Federated Services Company Federated Investors Tower
(Administrator) Pittsburgh, PA 15222-3779
Federated Advisers Federated Investors Tower
(Adviser) Pittsburgh, PA 15222-3779
State Street Bank and Trust P.O. Box 8600
Company Boston, MA 02266-8600
(Custodian)
Item 31. Management Services: Not applicable.
Item 32. Undertakings:
Registrant hereby undertakes to comply with the provisions of
Section 16(c) of the 1940 Act with respect to the removal of
Directors and the calling of special shareholder meetings by
shareholders.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, MONEY MARKET MANAGEMENT, INC.,
certifies that it meets all the requirements for effectiveness of this
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933
and has duly caused this Amendment to its Registration Statement to be signed on
its behalf by the undersigned, thereto duly authorized, all in the City of
Pittsburgh and Commonwealth of Pennsylvania, on the 24th day of February 1998.
MONEY MARKET MANAGEMENT, INC.
BY: /s/ Karen M. Brownlee
Karen M. Brownlee , Assistant Secretary
Attorney in Fact for John F. Donahue
February 24, 1998
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to its Registration Statement has been signed below by the following person in
the capacity and on the date indicated:
NAME TITLE DATE
By: /s/ Karen M. Brownlee
Karen M. Brownlee Attorney In Fact February 24, 1998
ASSISTANT SECRETARY For the Persons
Listed Below
NAME TITLE
John F. Donahue* Chairman and Director
(Chief Executive Officer)
J. Christopher Donahue* President and Director
John W. McGonigle* Treasurer, Executive Vice President,
and Secretary (Principal Financial
and Accounting Officer)
Thomas G. Bigley* Director
John T. Conroy, Jr.* Director
William J. Copeland* Director
James E. Dowd* Director
Lawrence D. Ellis, M.D.* Director
Edward L. Flaherty, Jr.* Director
Peter E. Madden* Director
John E. Murray, Jr.* Director
Wesley W. Posvar* Director
Marjorie P. Smuts* Director
* By Power of Attorney
Exhibit (11) under N-1A
Exhibit 23 under Item 601/Reg SK
INDEPENDENT AUDITORS' REPORT
To the Board of Trustees and Shareholders of Money MARKET MANAGEMENT, INC.
We consent to the use in Post-Effective Amendment No. 77 to Registration
Statement 2-49591 of Money Market Management, Inc. of our report dated February
6, 1997 appearing in the Prospectus, which is a part of such Registration
Statement, and to the reference to us under the heading "Financial Highlights"
in such Prospectus.
By: DELOITTE & TOUCHE LLP
Deloitte & Touche LLP
Pittsburgh, PA
February 23, 1998
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<PERIOD-END> Dec-31-1997
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