<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. / /
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Post-Effective Amendment No. 15 /X/
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and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 16 /X/
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(Check appropriate box or boxes.)
BARTLETT MANAGEMENT TRUST File Nos. 811-4071 and 2-92293
- --------------------------------------- -----------------------
(Exact Name of Registrant as Specified in Charter)
36 East Fourth Street, Cincinnati, Ohio 45202
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(Address of Principal Executive Offices) Zip Code
Registrant's Telephone Number, including Area Code (513) 621-0066
James F. Lummanick, 36 East Fourth Street, Cincinnati, Ohio 45202
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(Name and Address of Agent for Service)
Release Date: _____________________
It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b)
/x/ on August 1, 1995 pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a)
/ / on (date) pursuant to paragraph (a) of Rule 485
Registrant continues its election, made by the filing of its Registration
Statement, effective November 30, 1984, to register an indefinite number and
amount of securities under Rule 24f-2 under the Investment Company Act of 1940.
Pursuant to paragraph (b)(1) of Rule 24f-2, Registrant filed a Rule 24f-2
Notice for the fiscal year ended March 31, 1995, on April 27, 1995.
TOTAL NUMBER OF PAGES: _____.
EXHIBIT INDEX: PAGE _____.
<PAGE> 2
BARTLETT MANAGEMENT TRUST
FORM N-1A
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
N-1A ITEM NO. SECTION IN PROSPECTUS
<S> <C>
1............ Cover Page
2............ Fund Expenses
3............ Financial Highlights, Investment Performance
4............ Operation of the Trusts, Investment Objectives and
Strategies, General Information, Investment Policies
and Techniques, Investment Limitations, Portfolio
Management Policies for Bartlett Cash Reserves Fund
5............ Operation of the Trusts, Financial Highlights
5a........... In Registrant's Annual Report
6............ General Information, Cover Page, Dividends and
Distributions, Taxes
7............ Purchase of Shares, Calculation of Share Price,
Exchange Privilege
8............ Redemption of Shares
9............ None
14........... Trustees and Officers
15........... General Information
16........... Trustees and Officers
</TABLE>
<TABLE>
<CAPTION>
SECTION IN STATEMENT OF ADDITIONAL
INFORMATION
<S> <C>
10........... Cover Page
11........... Table of Contents
12........... Description of the Trust
13........... Investment Limitations, State Restrictions,
Additional Information about Fund Investments,
Portfolio Transactions and Brokerage
14........... The Investment Advisor, Management of the Trust
15........... Description of the Trust
16........... The Investment Advisor, Custodian, Accountants,
Transfer and Accounting Services Agent
17........... Portfolio Transactions and Brokerage
18........... Description of the Trust
19........... Calculation of Share Price
20........... None
21........... None
22........... Investment Performance
23........... Financial Statements
</TABLE>
<PAGE> 3
PROSPECTUS
BARTLETT VALUE INTERNATIONAL FUND
BARTLETT BASIC VALUE FUND
BARTLETT FIXED INCOME FUND
BARTLETT SHORT TERM BOND FUND
BARTLETT CASH RESERVES FUND
AUGUST 1, 1995
BARTLETT VALUE INTERNATIONAL FUND seeks capital appreciation by investing
primarily in foreign equity securities believed by its Advisor, Bartlett & Co.,
to be attractively priced relative to their intrinsic value. Income is a
secondary consideration. The Fund provides a means for individuals and
institutional investors to invest a portion of their assets outside the United
States. Foreign investments involve opportunities and risks not typically
associated with domestic investments.
BARTLETT BASIC VALUE FUND seeks capital appreciation by investing primarily in
common stocks or securities convertible into common stocks that are believed by
its Advisor, Bartlett & Co., to be attractively priced relative to their
intrinsic value. Income is a secondary consideration.
BARTLETT FIXED INCOME FUND seeks to provide a high level of current income by
investing primarily in high quality intermediate-term bonds. Capital
appreciation is a secondary consideration.
BARTLETT SHORT TERM BOND FUND seeks to provide a high level of current income
while maintaining a high degree of principal stability by investing primarily
in high quality short-term bonds.
BARTLETT CASH RESERVES FUND seeks the highest level of current income
consistent with stability of principal and liquidity. The Fund is a money
market fund designed for the short-term cash balances of corporations,
institutions and individuals.
An investment in the Bartlett Cash Reserves Fund is neither insured
nor guaranteed by the U.S. Government, and there can be no assurance that the
Fund will be able to maintain a stable net asset value of $1.00 per share.
Shares of these Funds are not deposits or obligations of any bank, are
not endorsed or guaranteed by any bank, and are not insured by the Federal
Deposit Insurance Corporation (FDIC) the Federal Reserve Board, or any other
government agency, entity or person. The purchase of Fund shares involves
investment risks, including the possible loss of principal.
Each Fund is a "no-load" fund. There are no sales or redemption
charges, and the Funds have no 12b-1 plans. The Bartlett Value International
Fund, the Bartlett Basic Value Fund, the Bartlett Fixed Income Fund and the
Bartlett Short Term Bond Fund are separate series of Bartlett Capital Trust.
The Bartlett Cash Reserves Fund is a series of Bartlett Management Trust. Both
Trusts are diversified open-end investment companies.
This Prospectus sets forth concisely the information about the Funds
that you ought to know before investing. Please read and retain this
Prospectus for future reference. Statements of Additional Information for the
Funds dated August 1,1995 have been filed with the Securities and Exchange
Commission and are hereby incorporated by reference in their entirety. A copy
of any Statement can be obtained at no charge by calling the numbers listed
below.
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For Information or Assistance in Opening an Account, Please Call:
Nationwide (Toll Free).............................(800)800-3609
Cincinnati.........................................(513)345-6212
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- --------------------------------------------------------------------------------
These securities have not been approved or disapproved by the Securities and
Exchange Commission or any state securities commission nor has the Securities
and Exchange Commission or any state securities commission passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is
a criminal offense.
- --------------------------------------------------------------------------------
BARTLETT CAPITAL TRUST
BARTLETT MANAGEMENT TRUST
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Fund Expenses. . . . . . . . . . . . . . . 2
Financial Highlights . . . . . . . . . . . 3
Investment Objectives and Strategies . . . 10
General. . . . . . . . . . . . . . . . . . 15
Trustees and Officer . . . . . . . . . . . 16
Purchase of Shares . . . . . . . . . . . . 18
Redemption of Shares . . . . . . . . . . . 20
Exchange Privilege . . . . . . . . . . . . 21
Operation of the Trusts . . . . . . . . . 22
Calculation of Share Price. . . . . . . . . . . 24
Dividends and Distributions . . . . . . . . . . 25
Taxes . . . . . . . . . . . . . . . . . . . . . 26
Investment Policies, Techniques and Risk
Considerations . . . . . . . . . . . . 27
Portfolio Management Policies for Bartlett
Cash Reserves Fund . . . . . . . . . . 40
Investment Limitations . . . . . . . . . . . . 40
General Information . . . . . . . . . . . . . . 41
Investment Performance . . . . . . . . . . . . 42
</TABLE>
<PAGE> 4
FUND EXPENSES
The purpose of the table below is to assist shareholders in understanding
the costs and expenses that shareholders of each Fund will bear directly or
indirectly. The expense information is based upon the operating expenses
incurred during the fiscal year ended March 31, 1995. The expenses are
expressed as a percentage of average net assets. The Example should not be
considered a representation of past or future performance or expenses, both of
which will vary.
Shareholders should be aware that the Funds are no-load funds and,
accordingly, a shareholder does not pay any sales charge or commission upon
purchase or redemption of shares of the Funds. Unlike most other mutual funds,
the management fees paid by the Funds include transfer agency, pricing,
custodial, auditing and legal services, and general administrative and other
operating expenses.
<TABLE>
<CAPTION>
Bartlett Value Bartlett Bartlett Bartlett Bartlett
International Basic Value Fixed Income Short Term Cash Reserves
Fund Fund Fund Bond Fund Fund
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION
EXPENSES
Maximum Sales Load on None None None None None
Purchases
Maximum Sales Load on
Reinvested None None None None None
Dividends
Deferred Sales Load None None None None None
Redemption Fee None None None None None
Exchange Fee None None None None None
ANNUAL FUND OPERATING
EXPENSES
Management Fees* 1.83% 1.20% 1.00% .85% .78%
12b-1 Fees None None None None None
Total Fund Operating 1.83% 1.20% 1.00% .85% .78%
Expenses*
</TABLE>
*The Fund's total operating expenses are equal to the management fee paid to
the Advisor. Unlike most other mutual funds, the management fees paid by the
Funds include transfer agency, pricing, custodial, auditing and legal services,
and general administrative and other operating expenses.
- 2 -
<PAGE> 5
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:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
Bartlett Value International Fund $19 $58 $99 $215
Bartlett Basic Value Fund $12 $38 $66 $145
Bartlett Fixed Income Fund $10 $32 $55 $122
Bartlett Short Term Bond Fund $ 9 $27 $47 $106
Bartlett Cash Reserves Fund $ 8 $25 $43 $97
</TABLE>
FINANCIAL HIGHLIGHTS
The following condensed financial information for all periods presented
for Bartlett Value International Fund, Bartlett Basic Value Fund, Bartlett
Fixed Income Fund and Bartlett Short Term Bond Fund and, for periods ending
subsequent to June 30, 1988, for Bartlett Cash Reserves Fund, has been audited
by Arthur Andersen LLP. The condensed financial information is an integral
part of Bartlett Capital Trust's and Bartlett Management Trust's audited
financial statements and should be read in conjunction with the financial
statements. The financial statements (excluding total return) for Bartlett
Management Trust for the period ending June 30, 1988 were audited by another
independent public accountant. The financial statements as of March 31, 1995
and related auditors' report appear in the applicable Statements of Additional
Information of the Trusts, which can be obtained by shareholders.
- 3 -
<PAGE> 6
BARTLETT VALUE INTERNATIONAL FUND
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Year Year Year Year Year Year
Ended Ended Ended Ended Ended Ended
3/31/95 3/31/94 3/31/93 3/31/92 3/31/91 3/31/90(a)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 12.46 $ 10.08 $9.93 $ 9.09 $ 9.79 $ 10.00
Income From Investment Operations:
Net Investment Income .09 .07 .12 .18 .30 .08
Net Realized and Unrealized Gains
(Losses) on Securities (.21) 2.38 .15 .88 (.70) (.05)
Total From Investment Operations (.12) 2.45 .27 1.06 (.40) .03
Less Distributions:
Dividends From Net Investment Income (.09) (.07) (.10) (.22) (.28) (.08)
Distributions From Realized Gains (.61) -- (.02) -- (.02) (.16)
Total Distributions (.70) (.07) (.12) (.22) (.30) (.24)
Net Asset Value, End of Period $ 11.64 $ 12.46 $ 10.08 $ 9.93 $ 9.09 $ 9.79
Total Return (1.18%) 24.42% 2.71% 11.88% (3.84%) 0.59%(c)
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $57,664 $49,607 $29,572 $22,042 $23,661 $20,557
Ratios Net of Fees Waived
by Advisor(b):
Ratio of Net Expenses to Average
Net Assets 1.83% 1.88% 2.00% 2.00% 1.99% 1.41%(c)
Ratio of Net Investment Income
to Average Net Assets .80% .55% 1.13% 1.79% 3.31% 1.80%(c)
Portfolio Turnover Rate 24% 19% 19% 27% 39% 155%(c)
</TABLE>
(a) From the date of the public offering of the Bartlett Value International
Fund (October 6, 1989) through March 31, 1990.
(b) The Advisor has periodically absorbed expenses of the Bartlett Value
International Fund through management fee waiver. If the Advisor had not
waived any fees, the ratios of net expenses to average net assets would
have been 1.94% and 2.14% and the ratios of net investment income to
average net assets would have been .49% and 1.07% for the periods ended
March 31, 1994 and 1990, respectively.
(c) Annualized.
- 4 -
<PAGE> 7
BARTLETT BASIC VALUE FUND
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Year Year Year Year Year
Ended Ended Ended Ended Ended
3/31/95 3/31/94 3/31/93 3/31/92 3/31/91
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 14.89 $ 14.76 $ 13.47 $ 12.60 $ 12.34
Income From Investment Operations:
Net Investment Income .27 .22 .30 .36 .46
Net Realized and Unrealized Gains
(Losses) on Securities 1.53 .28 1.57 .87 .26
Total From Investment Operations 1.80 .50 1.87 1.23 .72
Less Distributions:
Dividends From Net Investment (.27) (.23) (.30) (.36) (.46)
Income
Distributions From Realized Gains (1.03) (.14) (.28) -- --
Total Distributions (1.30) (.37) (.58) (.36) (.46)
Net Asset Value, End of Period $ 15.39 $ 14.89 $ 14.76 $ 13.47 $ 12.60
Total Return 12.67% 3.42% 14.22% 9.91% 6.29%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $102,721 $94,289 $103,507 $88,536 $96,165
Ratio of Expenses to Average
Net Assets 1.20% 1.20% 1.21% 1.22% 1.21%
Ratio of Net Investment Income
to Average Net Assets 1.81% 1.48% 2.14% 2.77% 3.87%
Portfolio Turnover Rate 26% 33% 43% 49% 92%
<CAPTION>
Year Year Year Year Year
Ended Ended Ended Ended Ended
3/31/90 3/31/89 3/31/88 3/31/87 3/31/86
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 12.56 $ 12.44 $ 12.96 $ 13.13 $ 10.88
Income From Investment Operations:
Net Investment Income .62 .57 .35 .46 .48
Net Realized and Unrealized Gains
(Losses) on Securities .21 1.20 (.51) 1.07 3.28
Total From Investment Operations .83 1.77 (.16) 1.53 3.76
Less Distributions:
Dividends From Net Investment (.62) (.56) (.36) (.45) (.49)
Income
Distributions From Realized Gains (.43) (1.09) -- (1.25) (1.02)
Total Distributions (1.05) (1.65) (.36) (1.70) (1.51)
Net Asset Value, End of Period $ 12.34 $ 12.56 $ 12.44 $ 12.96 $ 13.13
Total Return 6.49% 15.61% (1.24%) 11.38% 32.72%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $105,842 $100,333 $80,583 $91,091 $52,719
Ratio of Expenses to Average
Net Assets 1.19% 1.23% 1.57% 1.28% 1.56%
Ratio of Net Investment Income
to Average Net Assets 4.81% 4.57% 2.75% 3.49% 4.05%
Portfolio Turnover Rate 77% 99% 97% 58% 82%
</TABLE>
- 5 -
<PAGE> 8
BARTLETT FIXED INCOME FUND
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Year Year Year Year Year
Ended Ended Ended Ended Ended
3/31/95 3/31/94 3/31/93 3/31/92 3/31/91
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.02 $ 10.48 $ 9.93 $ 9.63 $ 9.46
Income From Investment Operations:
Net Investment Income .54 .48 .59 .67 .73
Net Realized and Unrealized Gains
(Losses) on Securities (.32) (.30) .55 .31 .17
Total From Investment Operations .22 .18 1.14 .98 .90
Less Distributions:
Dividends From Net Investment Income (.54) (.48) (.59) (.68) (.73)
Distributions From Realized Gains -- (.16) -- -- --
Total Distributions (.54) (.64) (.59) (.68) (.73)
Net Asset Value, End of Period $ 9.70 $ 10.02 $ 10.48 $ 9.93 $ 9.63
Total Return 2.41% 1.70% 11.81% 10.46% 9.86%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $91,349 $111,414 $135,487 $147,992 $159,218
Ratio of Expenses to Average
Net Assets(b) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of Net Investment Income
to Average Net Assets 5.60% 4.58% 5.81% 6.85% 7.68%
Portfolio Turnover Rate 118% 163% 175% 126% 165%
Amount of Debt Outstanding
at End of Period $ -- $ -- $ -- $ -- $ --
Average Amount of Debt
Outstanding During the
Period (c) (000's) $ 255 $ 2,550 $ 12,627 $ 6,601 $ --
Average Number of Shares
Outstanding During the
Period (d) (000's) 10,270 12,095 13,689 15,577 --
Average Amount of Debt Per
Share During the Period $ 0.02 $ 0.21 $ 0.92 $ 0.42 $ --
<CAPTION>
Year Year Year Year
Ended Ended Ended Ended
3/31/90 3/31/89 3/31/88 3/31/87(a)
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 9.36 $ 9.76 $ 10.18 $ 10.00
Income From Investment Operations:
Net Investment Income .82 .86 .83 .87
Net Realized and Unrealized Gains
(Losses) on Securities .10 (.40) (.42) .18
Total From Investment Operations .92 .46 .41 1.05
Less Distributions:
Dividends From Net Investment Income (.82) (.86) (.83) (.87)
Distributions From Realized Gains -- -- -- --
Total Distributions (.82) (.86) (.83) (.87)
Net Asset Value, End of Period $ 9.46 $ 9.36 $ 9.76 $ 10.18
Total Return 10.07% 4.83% 4.41% 11.27%(e)
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $156,587 $158,536 $157,116 $145,138
Ratio of Expenses to Average
Net Assets(b) 1.00% 1.00% 1.00% .93%(e)
Ratio of Net Investment Income
to Average Net Assets 8.56% 8.95% 8.56% 8.57%(e)
Portfolio Turnover Rate 95% 104% 205% 192%(e)
Amount of Debt Outstanding
at End of Period $ -- $ -- $ -- $ --
Average Amount of Debt
Outstanding During the
Period (c) (000's) $ -- $ -- $ -- $ --
Average Number of Shares
Outstanding During the
Period (d) (000's) -- -- -- --
Average Amount of Debt Per
Share During the Period $ -- $ -- $ -- $ --
</TABLE>
(a) Income earned and expenses incurred by the Fund from the date of the
initial purchase of shares by the Trust's Advisor (April 1, 1986) through
the initial public offering (April 22, 1986) were insignificant.
(b) Ratios do not include interest paid on reverse repurchase agreements.
(c) The average amount of debt outstanding during the period was calculated
by aggregating borrowings at the end of each day and dividing that sum by
the number of days in the period.
(d) The average number of shares outstanding during the period was calculated
by averaging the number of shares outstanding at the end of each month in
the period.
(e) Annualized.
- 6 -
<PAGE> 9
BARTLETT CASH RESERVES FUND
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Year Year Year Year
Ended Ended Ended Ended
3/31/95 3/31/94 3/31/93 3/31/92
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income From Investment Operations:
Net Investment Income .04 .03 .03 .05
Total From Investment Operations .04 .03 .03 .05
Less Distributions:
Dividends From Net Investment Income (.04) (.03) (.03) (.05)
Total Distributions (.04) (.03) (.03) (.05)
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total Return 4.22% 2.69% 3.26% 5.07%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $90,172 $77,558 $65,962 $75,867
Ratios Net of Fees Waived by Advisor (b):
Ratio of Net Expenses to Average
Net Assets .78% .77% .72% .67%
Ratio of Net Investment Income
to Average Net Assets 4.16% 2.71% 3.26% 5.05%
<CAPTION>
Year Nine Year Period
Ended Months Ended Ended
3/31/91 Ended 6/30/89 6/30/88
3/31/90 (a)
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income From Investment Operations:
Net Investment Income .07 .06 .08 .02
Total From Investment Operations .07 .06 .08 .02
Less Distributions:
Dividends From Net Investment Income (.07) (.06) (.08) (.02)
Total Distributions (.07) (.06) (.08) (.02)
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total Return 7.32% 8.13%(c) 8.42% 6.95%(c)
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $130,250 $105,503 $100,531 $71,780
Ratios Net of Fees Waived by Advisor (b):
Ratio of Net Expenses to Average
Net Assets .73% .75%(c) .86% .35%(c)
Ratio of Net Investment Income
to Average Net Assets 7.08% 7.97%(c) 8.11% 6.56%(c)
</TABLE>
(a) No income was earned or expense incurred by the Fund from the date of
organization (January 4, 1988) through the initial public offering date
(February 16, 1988).
(b) The Advisor has periodically absorbed expenses of the Bartlett Cash
Reserves Fund through management fee waiver. If the Advisor had not
waived any fees, the ratios of net expenses to average net assets would
have been .88%, .90%, .90%, .90%, .90%, .89%, and .88%, and the ratios of
net investment income to average net assets would have been 2.60%,
3.07%, 4.82%, 6.91%, 7.83%, 8.07% and 6.03% for the periods ended March
31, 1994 through 1988, respectively.
(c) Annualized.
- 7 -
<PAGE> 10
BARTLETT SHORT TERM BOND FUND
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
Year Period
Ended Ended
3/31/95 3/31/94(a)
<S> <C> <C>
Net Asset Value, Beginning of Period $ 9.94 $ 10.00
Income From Investment Operations:
Net Investment Income .53 .06
Net Realized and Unrealized Gains
(Losses) on Securities (.28) (.06)
Total From Investment Operations .25 .00
Less Distributions
Dividends From Net Investment Income (.53) (.06)
Total Distributions (.53) (.06)
Net Asset Value, End of Period $ 9.66 $ 9.94
Total Return 2.58% .04%(b)
Ratios/Supplemental Data:
Net Assets, End of Period (000's) $19,748 $22,288
Ratio of Expenses to Average
Net Assets .85% .85%(c)
Ratio of Net Investment Income
to Average Net Assets 5.38% 4.55%(c)
Portfolio Turnover Rate 158% 202%(c)
</TABLE>
(a) The period is from the date of the public offering of the Bartlett Short
Term Bond Fund (February 4, 1994) through March 31, 1994.
(b) Total return is for the period February 4, 1994 through March 31, 1994.
(c) Annualized.
- 8 -
<PAGE> 11
INVESTMENT OBJECTIVES AND STRATEGIES
VALUE-ORIENTED STRATEGY
The investment advisor to the Funds, Bartlett & Co. ("the Advisor") uses
an active, value-oriented investment strategy in the management of the Bartlett
Value International Fund, the Bartlett Basic Value Fund, the Bartlett Fixed
Income Fund, the Bartlett Short Term Bond Fund and the Bartlett Cash Reserves
Fund.
Under this approach, the Advisor seeks to identify undervalued
securities. Evaluation of equity securities by the Advisor is based upon
analysis of several factors, including:
* low or declining debt levels
* comparatively low price to cash flow ratios
* comparatively low price to asset value ratios
Similarly, the Advisor seeks to identify undervalued fixed income securities
based upon an ongoing analysis of the following three major factors:
* yield curve -- evaluating the relative attractiveness of individual
bond maturities along the yield curve
* sector spreads -- monitoring the relative attractiveness between
U.S. Treasuries and other fixed income sectors, such as corporates,
mortgages and municipals
* credit quality -- seeking out issuers whose trend in credit quality
is stable or improving
The Advisor also employs a disciplined approach to the sell process.
Securities are sold from a Fund's portfolio when their relative valuations are
no longer favorable, generally when one of three triggering events occurs:
* a pre-determined price objective has been met
* a more attractive investment opportunity becomes available
* a change in the underlying fundamentals, such as a downgrade in
ratings
- 9 -
<PAGE> 12
BARTLETT VALUE INTERNATIONAL FUND
The Bartlett Value International Fund provides a means for individuals
and institutional investors to invest a portion of their assets outside the
United States. The investment objective of the Bartlett Value International
Fund is to seek capital appreciation. The Fund seeks its objective by
investing primarily in foreign equity securities believed by the Advisor to be
attractively priced relative to their intrinsic value. Income is a secondary
consideration.
The Fund invests primarily in equity securities of non-U.S. issuers
generally consisting of common stocks, common stock equivalents and preferred
stocks. The Fund also may invest indirectly in foreign equity securities by
purchasing American Depositary Receipts, European Depositary Receipts or other
similar securities and by purchasing shares of closed-end investment companies
that hold foreign equity securities in their portfolios.
However, there is no requirement that the Fund invest exclusively in
foreign equity securities. The Fund may invest in other types of foreign
securities such as debt obligations of foreign companies, foreign governments,
foreign governmental agencies and international organizations. In addition,
the Fund may invest a portion of its assets in U.S. government obligations,
debt and equity obligations of U.S. issuers, and repurchase agreements, and may
hold a portion of its assets in cash and U.S. dollar denominated time deposits.
For temporary defensive or temporary liquidity purposes, the Bartlett
Value International Fund may hold all or a portion of its assets in domestic or
foreign money market instruments, cash equivalents, securities of other no-load
registered investment companies or repurchase agreements.
In seeking its objective, the Fund intends to diversify its investments
among issuers representing various countries. Under normal circumstances, at
least 65% of the Fund's total assets will be invested in non-United States
issuers and at least three different foreign countries will be represented in
the Fund's portfolio. The Fund may invest in countries in Western Europe, the
Far East, Canada, Australia and other geographic regions. The Fund may, from
time to time, have more than 25% of its assets invested in any major industrial
or developed country which in the view of the Advisor poses no unique
investment risk. If circumstances warrant, for temporary, defensive purposes,
the Fund may invest substantially all of its assets in one or two countries.
The Advisor selects portfolio securities on the basis of what the Advisor
considers to be the intrinsic value of each
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<PAGE> 13
security. In analyzing the intrinsic value of a specific security, particular
emphasis is given to such characteristics as relative price/earnings ratio,
dividend yield, and price/book value ratio. In making investment decisions,
the Advisor considers all other pertinent factors affecting the intrinsic value
of a security, including financial, tax, social, political and national
conditions.
Although the Fund provides a means for individuals and institutional
investors to invest a portion of their assets outside the U.S., it should not
be considered to be a complete investment program. In addition, investments in
foreign securities may be subject to risks not typically associated with
investments in domestic securities. See "Foreign Securities" for a more
complete discussion of certain risks associated with investments in foreign
securities.
See "General" at page 15 and "Investment Policies, Techniques and Risk
Considerations" beginning at page 27 for a more detailed discussion of risks
associated with the securities and investment techniques discussed above.
BARTLETT BASIC VALUE FUND
The investment objective of the Bartlett Basic Value Fund is to seek
capital appreciation. The Fund seeks its objective by investing primarily in
common stocks or securities convertible into common stocks that the Advisor
believes to be selling at attractive prices relative to their intrinsic value.
Income is a secondary consideration. In determining whether a specific
security represents investment value, particular emphasis is given to such
characteristics as low debt, relative price/earnings ratio, dividend yield, and
price/book value ratio. The Fund seeks to diversify its investments across
industry sectors. The Fund's investments may include foreign securities.
In seeking its objective, the Bartlett Basic Value Fund invests only in
securities of companies with at least three years of operating history. Due
to the Bartlett Basic Value Fund's disciplined investment methodology, and the
cyclical nature of the economy and investment markets, there will be times when
the Advisor is unable to purchase reasonably valued common stocks and common
stock equivalents. At these times, the Fund may hold all or a portion of its
assets in fixed income securities.
For a further discussion of the risks associated with these securities
and techniques, see "General" at page 15 and "Investment Policies, Techniques
and Risk Considerations," beginning on page 27.
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<PAGE> 14
BARTLETT FIXED INCOME FUND
The investment objective of the Bartlett Fixed Income Fund is to seek a
high level of current income by investing primarily in high quality
intermediate-term bonds. Capital appreciation is a secondary consideration.
The Fund seeks to limit price volatility by investing primarily in
intermediate-term bonds, although it also may invest in short- and long-term
bonds. Historically, the Fund's dollar weighted average effective portfolio
maturity has ranged between four to eight years. Fixed income securities with
intermediate-term maturities generally have greater price stability than that
of long- term bonds that offer somewhat higher yields, but less price stability
than that of short-term bonds that offer somewhat lower yields.
The Fund seeks to achieve its objective by:
* maintaining at least 65% of the total assets of the Fund, under
normal circumstances, in U.S. Government securities or high quality
fixed income securities rated AA or higher by Standard & Poor's
Corporation ("S&P"), Moody's Investor Services ("Moody's"), Duff &
Phelps ("D&P") or Fitch Investors Services ("Fitch") (or if
unrated, judged by the Advisor to be of comparable quality);
* purchasing fixed income securities of predominately
investment-grade quality, while reserving the right to invest no
more than 5% of its assets in securities below investment grade;
* focusing on intermediate-term fixed income investments, although it
may also invest in short-term and long-term fixed income
investments; and
* using a "bottom up" value-oriented investment strategy to identify
undervalued fixed income securities or sectors.
Under normal circumstances, at least 65% of the total assets of the Fund
will be invested in a portfolio of U. S. Government securities or high quality
bonds rated AA or higher by Standard & Poor's Corporation ("S&P"), Moody's
Investor Services ("Moody's"), Duff & Phelps ("D&P") or Fitch Investors
Services ("Fitch"). The Fund's portfolio securities will include U.S.
Government obligations, securities of foreign governments, domestic or foreign
corporate debt securities, municipal obligations, mortgage-related securities,
financial service industry obligations, preferred stock and repurchase
agreements. Bonds are debt securities with a maturity of one year or
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<PAGE> 15
more at issuance. Eligible securities will include unrated securities judged by
the Advisor to be comparable to securities rated AA or higher.
The Fund generally will invest the remainder of its portfolio in debt
securities rated at the time of purchase as investment grade (BBB by S&P, Baa
by Moody's, BBB by D&P or BBB by Fitch). If the rating of a security held in
the portfolio is downgraded below investment grade, the Advisor will determine
whether it is in the best interest of the Fund's shareholders to continue to
hold such security. The Fund may invest in fixed income securities which are
unrated if they are judged by the Advisor to be of investment grade or higher
quality.
The Fund reserves the right to invest no more than five percent of its
portfolio in debt securities rated at the time of purchase as below investment
grade. Such securities commonly are known as "junk bonds" and entail default
and other risks (including weakened capacity to pay interest and repay
principal) greater than those associated with higher-rated securities. See
"Fixed Income Securities" for a further discussion of quality ratings, as well
as the discussion of ratings under "Additional Information About Fund
Investments" in the Statement of Additional Information.
For a further discussion of the risks associated with these securities
and techniques, see "General" at page 15 and "Investment Policies, Techniques
and Risk Considerations" beginning on page 27.
BARTLETT SHORT TERM BOND FUND
The investment objective of the Bartlett Short Term Bond Fund is to seek
a high level of current income while maintaining a high degree of principal
stability by investing primarily in high quality short-term bonds.
The Fund is designed for individual, institutional and corporate
investors who seek:
* higher current income than is normally provided by money market
investments
* greater price stability than is generally available from
intermediate or long-term bonds, and
* the relative safety provided by higher quality fixed income
securities.
Money market funds usually are managed for total price stability, but
generally tend to provide somewhat lower yields
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<PAGE> 16
than do short-term bond funds. Unlike money market funds, the Bartlett Short
Term Bond Fund does not maintain a stable net asset value of $1.00 per share.
Investors seeking high levels of price stability may find the Fund attractive
compared to intermediate or long-term bond funds that generally offer somewhat
higher yields, but less price stability.
Certain investors may view the Fund as an alternative to a bank
certificate of deposit ("CD"). Although an investment in the Fund is not
federally insured and there is no guarantee of price stability, an investment
in the Fund may be redeemed at its current value at any time without incurring
early withdrawal penalties generally associated with CDs. The Fund also may
provide a higher yield than CDs. The Fund may be appropriate for Individual
Retirement Accounts ("IRAs"), 401(k) plans and other retirement plans which
compound income on a tax-deferred basis.
The Fund seeks to achieve its objective by:
* purchasing fixed income securities of at least investment-grade
quality;
* maintaining at least 65% of the total assets of the Fund, under
normal circumstances, in U.S. Government securities or high quality
fixed income securities rated AA or higher by Standard & Poor's
Corporation ("S&P"), Moody's Investor Services ("Moody's"), Duff &
Phelps ("D&P") or Fitch Investors Services ("Fitch") (or if
unrated, judged by the Advisor to be of comparable quality);
* focusing on short-term fixed income investments, normally
maintaining a dollar weighted average effective portfolio maturity
from one to three years; and
* using a "bottom up" value-oriented investment strategy to identify
undervalued fixed income securities or sectors.
The share price of the Fund will fluctuate. However, the Fund seeks to
maintain a high degree of principal stability by:
* maintaining a relatively short portfolio maturity;
* investing in higher quality securities;
* investing in undervalued securities, which tend to experience less
negative price volatility; and
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<PAGE> 17
* investing in some securities whose prices exhibit a low, no or
negative correlation to broad movements in interest rates.
To maintain a shorter portfolio maturity, the Fund will not invest in
individual securities with remaining expected maturities longer than ten years
from the date of purchase (although the face maturity may be longer than ten
years). The "expected" maturity of a security and the "effective" portfolio
maturity will take into account the availability of demand features and
anticipated calls or prepayments of securities to shorten the face maturity of
the security or portfolio.
Under normal circumstances, at least 65% of the total assets of the Fund
will be invested in a portfolio of high quality securities rated AA or higher
by S&P, Moody's, D&P, or Fitch. These securities will include U.S. Government
securities (including bonds, notes and bills issued by the U.S. Treasury and
securities issued by agencies of the U.S. Government), securities of foreign
governments, domestic or foreign high-grade corporate debt securities
(including bonds, notes and debentures), mortgage-related securities, financial
service industry obligations, municipal obligations, repurchase agreements and
other asset-backed securities. Eligible securities will include unrated
securities judged by the Advisor to be comparable to securities rated AA or
higher. Under normal circumstances, at least 65% of the total assets of the
Fund will be invested in bonds, which are debt securities with a maturity of
one year or more at issuance.
The Fund will not invest in any debt security rated at the time of
purchase lower than investment grade (BBB by S&P, Baa by Moody's, BBB by D&P or
BBB by Fitch). If the rating of a security held in the portfolio is downgraded
below investment grade, the Advisor will determine whether it is in the best
interest of the Fund's shareholders to continue to hold such security. The
Fund may invest in fixed income securities which are unrated if they are judged
by the Advisor to be of investment grade or higher quality. See "Fixed Income
Securities" for a further discussion of quality ratings, as well as the
discussion of ratings under "Additional Information About Fund Investments" in
the Statement of Additional Information.
In addition, the Fund may invest in money market instruments (including
commercial paper) reverse repurchase agreements and privately placed debt
obligations. The Fund also may purchase securities on a when-issued or forward
delivery basis and utilize foreign currency transactions, hedging and other
investment strategies. See "Investment Policies and Techniques."
For a further discussion of the risks associated with these securities
and techniques, see "General" at page 15 and
- 15 -
<PAGE> 18
"Investment Policies, Techniques and Risk Considerations" beginning on page 27.
BARTLETT CASH RESERVES FUND
The investment objective of the Bartlett Cash Reserves Fund is to produce
the highest level of current income consistent with stability of principal and
liquidity. The Fund is a money market fund designed for the investment of
short-term cash reserves, and the Advisor believes the Fund is an appropriate
investment for corporations, pension and profit sharing plans, and other
institutional and individual investors.
In seeking its objective, the Fund invests in a broad range of short-term
money market securities, which may include: (i) U.S. government obligations,
(ii) corporate debt securities (including commercial paper), (iii) municipal
obligations, (iv) mortgage-related securities, (v) financial services industry
(including bank and savings and loan association) obligations, (vi) repurchase
agreements involving these securities, (vii) U.S. dollar denominated foreign
securities (securities issued by foreign issuers, including foreign governments
and foreign branches of U.S. banks) and (viii) shares of money market funds.
See "Investment Policies and Techniques" for a more detailed discussion of the
Fund's investment practices.
The Fund seeks to maintain a stable net asset value of $1.00 per share
pursuant to a rule of the Securities and Exchange Commission, which requires
that the Fund's portfolio meet certain maturity, quality and diversification
standards. Those standards are described in "Portfolio Management Policies for
the Bartlett Cash Reserves Fund."
The Fund under normal market conditions will invest at least 25% of its
total assets in the financial services industry, and an investment in the Fund
should be made with an understanding of the characteristics of the industry and
the risks which such an investment may entail. See "Financial Service Industry
Obligations" for a discussion of these matters.
GENERAL
In addition to the securities and investment techniques described above,
the Bartlett Basic Value Fund, the Bartlett Fixed Income Fund and the Bartlett
Short Term Bond Fund may invest in a wide variety of other securities,
including U. S. Government securities, mortgage-related securities, municipal
obligations, asset- or receivable backed securities and foreign securities, and
they may employ several investment techniques, including the use of options,
hedging programs, currency
- 16 -
<PAGE> 19
transactions, repurchase agreements, reverse repurchase agreements and dollar
rolls, lending of portfolio securities and forward commitment transactions.
See "Investment Policies, Techniques and Risk Considerations" beginning on page
27.
For temporary defensive purposes, each of the Bartlett Mutual Funds
(other than the Bartlett Cash Reserves Fund) may hold all or a portion of its
assets in money market instruments, cash equivalents (fixed income securities
with maturities of less than one year), securities of other no-load registered
investment companies or repurchase agreements. See "Investment Policies,
Techniques and Risk Considerations" beginning on page 27.
As all investment securities are subject to inherent market risks and
fluctuations in value due to earnings, economic and political conditions and
other factors, no Fund can give any assurance that its investment objective
will be achieved. The values of fixed income securities fluctuate inversely to
interest rate changes. Current yields or rates of total return quoted by a Fund
may be higher or lower than past quotations, and there can be no assurance that
any current yield or rate of total return will be maintained.
TRUSTEES AND OFFICERS
The names of the Trustees and executive officers of Bartlett Capital
Trust and Bartlett Management Trust are shown below. Each Trustee who is an
"interested person" of either Trust, as defined in the Investment Company Act
of 1940, is indicated by an asterisk.
<TABLE>
<CAPTION>
POSITION WITH POSITION WITH BARTLETT
NAME BARTLETT CAPITAL TRUST MANAGEMENT TRUST
<S> <C> <C>
*Dale H. Rabiner, CFA Trustee, Chairman Trustee and Vice
of the Board and President
Vice President
*James B. Reynolds, CFA Trustee and Vice Trustee, Chairman of
President the Board and Vice
President
Lorrence T. Kellar Trustee Trustee
Philip J. Ringo Trustee Trustee
Alan R. Schriber Trustee Trustee
William P. Sheehan Trustee Trustee
George J. Wile Trustee Trustee
Carol D. Hard President President
James F. Lummanick, Esq. Secretary Secretary
Thomas A. Steele, CPA Treasurer Treasurer
Kenneth L. Schlachter, CFA Assistant Treasurer Assistant Treasurer
R. Stuart Crickmer, CFA,CPA Vice President Vice President
Madelynn M. Matlock, CFA Vice President
James A. Miller, CFA Vice President
Donna M. Prieshoff Vice President Vice President
Troy R. Snider,CFA Vice President
Woodrow H. Uible, CFA Vice President
</TABLE>
- 17 -
<PAGE> 20
The principal occupations of the executive officers and Trustees of the
Trusts during the past five years are set forth below:
Dale H. Rabiner, CFA, 36 East Fourth Street, Cincinnati, Ohio is a Senior
Portfolio Manager and a Managing Director of Bartlett & Co.
James B. Reynolds, CFA, 36 East Fourth Street, Cincinnati, Ohio is a Senior
Portfolio Manager and a Managing Director of Bartlett & Co.
Lorrence T. Kellar, 1014 Vine Street, Cincinnati, Ohio is Group Vice-President
of The Kroger Co., a food retailer.
Philip J. Ringo, 102 Pickering Way, Exton, Pennsylvania is the President and
Chief Executive Officer of Chemical Lehman Tank Lines, Inc. a bulk motor
carrier. Prior to July 1995, he was Chairman of the Board and Chief Executive
Officer of Morgan Drive Away, Inc., a transporter of mobile homes, recreational
vehicles and other commodities. Prior to August, 1992, he was Chief Executive
Officer and President of Energy Innovations, Inc., Dayton, Ohio, a monitoring
and communications equipment firm.
Alan R. Schriber, 133 South Main Street, Batesville, Indiana is the President
of ARS Broadcasting Corp., a company which owns and operates radio stations.
Prior to October, 1989, he was a Commissioner of the Public Utilities
Commission of Ohio.
William P. Sheehan, 65 East State Street, Columbus, Ohio is a member of the
State of Ohio Employment Relations Board.
George J. Wile, 4200 Malsbary Road, Cincinnati, Ohio is the Chief Executive
Officer of Planet Products Corporation, a manufacturer of packaging machinery.
Prior to October, 1993, he was Chairman of the Board of Atek Metals Center,
Inc., a company that distributes and manufactures super-alloy products used in
the aviation industry.
Carol D. Hard, 36 East Fourth Street, Cincinnati, Ohio is Director of Mutual
Funds for Bartlett & Co. Between April, 1990 and September, 1993, she was a
Vice President with AAL Capital Management Corporation, a broker-dealer and
investment advisor for a family of mutual funds. Prior thereto, she was a
registered representative with Edward D. Jones & Co. and a limited partner of
The Jones Financial Companies.
James F. Lummanick, Esq., 36 East Fourth Street, Cincinnati, Ohio is the
Secretary and Counsel for Bartlett & Co. Prior to November 1993, he practiced
law with the firm of Frost & Jacobs, Cincinnati, Ohio.
Thomas A. Steele, CPA, 36 East Fourth Street, Cincinnati, Ohio is the Internal
Tax Manager for Bartlett & Co.
- 18 -
<PAGE> 21
Kenneth L. Schlachter, CFA, 36 East Fourth Street, Cincinnati, Ohio is the
Mutual Fund Operations Manager of Bartlett & Co.
R. Stuart Crickmer, CPA, CFA, 36 East Fourth Street, Cincinnati, Ohio is a
Portfolio Manager and Fixed Income Analyst for Bartlett & Co.
Madelynn M. Matlock, CFA, 36 East Fourth Street, Cincinnati, Ohio is the
Director of International Equities for Bartlett & Co.
James A. Miller, CFA, 36 East Fourth Street, Cincinnati, Ohio is a Senior
Portfolio Manager and a Managing Director of Bartlett & Co.
Donna M. Prieshoff, 36 East Fourth Street, Cincinnati, Ohio is the Director of
Operations and a Director of Bartlett & Co.
Troy R. Snider, CFA, 36 East Fourth Street, Cincinnati, Ohio has been a Fixed
Income Analyst of Bartlett & Co. since April 1991. Prior thereto he was an
energy analyst with Duff & Phelps, an investment research firm.
Woodrow H. Uible, CFA, 36 East Fourth Street, Cincinnati, Ohio is a Senior
Portfolio Manager and a Director of Bartlett & Co.
PURCHASE OF SHARES
Shares of each Fund are sold without a sales charge at the next price
calculated after receipt of the order in proper form by the Fund. A minimum
investment of $5,000 is required to open an account in any Fund ($250 for IRAs
or other tax sheltered retirement plans). Additional purchases may be made in
any Fund in amounts of $100 or more. In its discretion, the Fund may waive
such minimums for investments made by employer sponsored qualified retirement
plans or through automatic investment programs, investments made through
brokerage firms or other financial institutions, or for investments made by
advisory clients of Bartlett & Co. and employees of Bartlett & Co. and their
families.
If your check or wire does not clear, or if any telephone purchase must
be cancelled due to nonpayment, you will be responsible for any loss incurred.
If you are already a shareholder, the Fund can redeem shares from any
identically registered account in any of the Funds as reimbursement for any
loss incurred. You may be prohibited or restricted from making future
purchases in any of the Funds.
- 19 -
<PAGE> 22
INITIAL INVESTMENTS BY MAIL
You may purchase shares of each Fund by completing and signing the
investment application form which accompanies this Prospectus and mailing it,
together with a check made payable to Bartlett Mutual Funds (subject to the
above minimum amounts), c/o Bartlett & Co., 36 E. Fourth St., Cincinnati, Ohio
45202.
Your order for shares of the Bartlett Cash Reserves Fund will not be
complete until the Fund has received federal funds. If a check for purchase of
shares is not drawn on federal funds, shares will be purchased at the next
share price calculated after the check is converted into federal funds
(normally two days or less).
INITIAL INVESTMENTS BY WIRE
You also may purchase shares of each Fund by bank wire. Prior to your
initial investment by wire, you must telephone Bartlett & Co. (Nationwide call
toll free 800-800-3609; in Cincinnati call 513-345-6212) to advise it of the
investment and to receive instructions. You should be prepared to give the
name(s) of the Fund in which you wish to invest, the name(s) in which the
account is to be registered, the address, telephone number and taxpayer
identification number for the account(s) and the name of the bank which will
wire the money.
Then, you must instruct your bank (which must be a member of, or have a
corresponding relationship with a member of, the Federal Reserve System) to
wire federal funds to:
The Provident Bank, Cincinnati, Ohio
ABA No. 042000424
For Credit to Bartlett Mutual Funds
Transfer Agency Account No. 0387-515
For Further Credit to:
Client Names(s)
Client Account No. (if existing account)
Specific Bartlett Mutual Fund(s) selected
Your purchase will be effected at the share price next determined after
receipt of your wire. Any wire purchase for which a specific Fund is not
indicated will be invested in the Bartlett Cash Reserves Fund.
You are required to mail a signed application to Bartlett Mutual Funds at
the above address in order to complete your initial wire purchase. Your bank
may impose a charge for sending your wire. There is presently no fee for the
receipt of wired funds, but the right to charge shareholders for this service
is reserved by the Funds.
- 20 -
<PAGE> 23
ADDITIONAL INVESTMENTS
You may purchase additional shares of each Fund at any time by mail or by
bank wire (minimum of $100). In its discretion, the Fund may waive such
minimums for investments made by employer sponsored qualified retirement plans
or through automatic investment programs, investments made through brokerage
firms or other financial institutions, or for investments made by advisory
clients of Bartlett & Co. and employees of Bartlett & Co. and their families.
Each additional purchase request must contain your name, your client number(s),
the name of your account(s), your account number(s) and the Fund(s) in which
you wish to invest. Checks should be made payable to Bartlett Mutual Funds and
should be sent to the Bartlett Mutual Funds' address. A bank wire should be
sent as outlined on the previous page.
AUTOMATIC INVESTMENT PROGRAM
You also may be able to purchase shares of any Fund through an automatic
investment program. By using such a program, funds are automatically
transferred from your payroll check or your bank checking or savings account
into your Fund account on a regular basis. This type of automatic investment
program is offered free of charge. For further information, you or your
employer may contact the Bartlett Mutual Funds.
TAX SHELTERED RETIREMENT PLANS
Shares of any Fund are available for purchase in connection with the
following tax sheltered retirement plans:
-- individual retirement account (IRA) plans for individuals and their
non-employed spouses
-- Keogh Plans (H.R. 10) for self-employed individuals
-- qualified pension and profit-sharing plans for employees, including those
profit-sharing plans with a 401(k) provision
-- 403(b) retirement plans for employees of public school systems,
hospitals, colleges and other non-profit organizations meeting certain
requirements of the Internal Revenue Code.
OTHER PURCHASE INFORMATION
Shares of each Fund also may be purchased through a broker at the share
price next determined after receipt by the broker of your order in proper form.
The broker may charge a fee for its services in connection with the purchase.
The Funds do not issue share certificates. You will receive a confirmation of
all
- 21 -
<PAGE> 24
investments in or withdrawals from your account in the Bartlett Value
International Fund, the Bartlett Basic Value Fund, the Bartlett Fixed Income
Fund and the Bartlett Short Term Bond Fund. You will receive a confirmation of
your initial investment and a statement of subsequent investments and
withdrawals at least monthly from the Bartlett Cash Reserves Fund. The rights
to limit the amount of purchases and to refuse to sell to any person are
reserved by each Fund.
You may exchange securities that you own for shares of any Fund, provided
the securities meet the Fund's investment criteria and the Advisor deems them
to be a desirable investment for the Fund. Any exchange will be a taxable
event and you may incur certain transaction costs relating to the exchange.
Contact Bartlett Mutual Funds for additional information.
REDEMPTION OF SHARES
You may redeem any part of your account in any Fund by mail or telephone.
Each Fund will redeem your shares without charge at the next share price
calculated after receipt of your properly completed request for withdrawal.
BY MAIL
To redeem shares by mail, you must send a letter to Bartlett Mutual
Funds, 36 E. Fourth St., Cincinnati, Ohio 45202, stating your client number(s),
your account number(s), the Fund(s) from which the shares are to be redeemed
and the number or dollar amount of the shares to be redeemed. The letter must
be signed by each shareholder, including each joint owner, exactly as the
shareholder's name appears on the Fund's client registration. Although you are
not required to do so currently, for withdrawals in excess of $5,000, the Trust
may require that signatures be guaranteed by a domestic commercial bank or
trust company or by a member firm of a national securities exchange. Signature
guarantees are for the protection of shareholders. At the discretion of a Fund
or Bartlett & Co., a shareholder, prior to redemption, may be required to
furnish additional legal documents to insure proper authorization.
BY TELEPHONE
You may request a redemption of your shares in any Fund by calling
Bartlett Mutual Funds and requesting that proceeds be mailed to you or wired to
your bank or brokerage firm. It is not necessary for you to first make a
written election to initiate a telephone redemption. The redemption will be
effected at the next determined share price. The proceeds will then be made
- 22 -
<PAGE> 25
payable to the registered shareholder and mailed to the address registered on
the account, or wired to your bank or brokerage firm, as previously authorized
by you on your application or in some other written form. The Trusts, the
Transfer Agent and the Custodians will employ reasonable procedures to confirm
that instructions communicated by telephone are genuine. Such procedures will
include recording telephone instructions and requiring a form of personal
identification from the caller. There is no charge for wire redemptions;
however, the Fund reserves the right, upon 30 days' written notice, to charge
for this service. Any charges for wire redemptions will be deducted from the
shareholder's Fund account by redemption of shares.
The Trusts, the Transfer Agent and the Custodians are not liable for
following instructions communicated by telephone that they reasonably believe
to be genuine. However, if they do not employ reasonable procedures to confirm
that telephone instructions are genuine, they may be liable for any losses due
to unauthorized or fraudulent instructions. The telephone redemption procedure
may be terminated at any time by the Fund or the Transfer Agent. During
periods of extreme market activity it is possible that shareholders may
encounter some difficulty in telephoning the Funds, although neither the Funds
nor the Transfer Agent has ever experienced difficulties in receiving and in a
timely fashion responding to telephone requests for redemptions or exchanges.
If you are unable to reach the Funds by telephone, you may request a redemption
or exchange by mail or facsimile.
CHECKWRITING PRIVILEGES
Shareholders of the Bartlett Short Term Bond Fund and the Bartlett Cash
Reserves Fund also may elect to write checks on their accounts with those
Funds. With this feature, shareholders may redeem by check, provided that the
checks(s) contain the proper signatures, and that the appropriate
authorizations are provided to the Bartlett Mutual Funds. Ordinarily, shares
will be redeemed on the day a check drawn on the Bartlett Mutual Fund Account
is presented in proper form to the Transfer Agent. However, Bartlett Mutual
Fund shares purchased by check may not be redeemed by writing a check against
the account until the purchase check has been collected, which normally may
take up to fifteen days.
There will be no charge for this service, but checks written against a
Fund account must be for at least $500 in the case of the Bartlett Cash
Reserves Fund or $1,000 in the case of the Bartlett Short Term Bond Fund. An
investment in a Fund will continue to earn dividends until a check is presented
to the Fund for payment. As would occur with a bank check, if there are
insufficient funds to cover the withdrawal amount, the Fund's
- 23 -
<PAGE> 26
check will be returned by the Fund's Transfer Agent. Shareholders should not
attempt to close an account by check, because the exact account balance at the
time the check clears likely will be different from the account balance at the
time the check is written.
Shareholders should be aware that a redemption by check entails a sale of
shares in the Fund and thus may have tax consequences.
Shareholders should be aware that the checkwriting feature is not
available for certain retirement plans or accounts.
OTHER REDEMPTION INFORMATION
Each Fund generally will make payment on the next business day, but in no
event later than seven days, after it accepts your request, except under
unusual circumstances as determined by the Securities and Exchange Commission.
However, payment for redemption made against shares purchased by check will be
made only after the check has been collected, which normally may take up to
fifteen days. To eliminate this delay, you may purchase shares by certified
check or bank wire.
Shares of each Fund also may be redeemed through a broker which may
charge a fee for its services in connection with the redemption.
Because the Funds incur certain fixed costs in maintaining shareholder
accounts, each Fund reserves the right to require any shareholder to redeem all
of his or her shares in the Fund on 30 days' written notice if the value of his
or her shares in the Fund is less than $5,000 due to redemption ($250 for tax
sheltered retirement plans), or such other minimum amount as the Fund may
determine from time to time. A shareholder may increase the value of his or
her shares in the Fund to the minimum amount within the 30 day period. The
shares of each Fund are subject to redemption at any time if the Board of
Trustees of the applicable Trust determines in its sole discretion that failure
to so redeem may have materially adverse consequences to all or any of the
shareholders of the Trust or any Fund of the Trust. The net asset value of
your shares will fluctuate with the value of the underlying securities, and
your account at the time of redemption may be worth more or less than the
amount you invested. However, it is anticipated that the Bartlett Cash
Reserves Fund will maintain a stable net asset value of $1.00.
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<PAGE> 27
EXCHANGE PRIVILEGE
The Funds have made arrangements to enable you, if your investment
objectives change, to exchange shares of any Fund without sales charge for
shares of any other Bartlett Fund and any Bartlett Fund offered in the future.
An exchange is generally a taxable event and shareholders should consult their
tax advisors about the tax effect of an exchange. Exchanges may only be made
for shares of Bartlett Funds then offering shares for sale in your state of
residence. Exchanges are subject to the applicable minimum initial investment
requirement.
You may request exchanges in writing or by telephone. It is not
necessary for you to first make a written election to initiate a telephone
exchange. The Trusts and the Transfer Agent are not liable for following
exchange instructions communicated by telephone that they reasonably believe to
be genuine. However, if they do not employ reasonable procedures to confirm
that telephone instructions are genuine, they may be liable for any losses due
to unauthorized or fraudulent instructions. Procedures employed will include
recording telephone instructions and requiring a form of personal
identification from the caller. Shareholders will be given 60 days' prior
notice of any modifications or termination of this Exchange Privilege.
In addition, an excessive number of exchanges may be disadvantageous to
the shareholders of the Funds, in that such exchanges increase transaction
costs and may require the maintenance of excessive cash positions, both of
which may reduce investment returns. Therefore, each Fund reserves the right
to limit the amount of any exchange or at any time temporarily or permanently
terminate the exchange privilege for any person who makes more than twelve
exchanges into or out of any Fund in any twelve month period.
OPERATION OF THE TRUSTS
Bartlett Capital Trust is a diversified, open-end management investment
company organized as a Massachusetts business trust on October 31, 1982.
Bartlett Management Trust is a diversified, open-end management investment
company organized as an Ohio business trust on July 16, 1984. The business
activities of each Trust are supervised by its Board of Trustees. Like other
mutual funds, the Trusts retain various organizations to perform specialized
services.
THE ADVISOR
Each Trust retains Bartlett & Co., 36 East Fourth Street, Cincinnati,
Ohio (the "Advisor") to manage its investments and
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its business affairs. The Advisor is an investment advisory firm which has
provided investment advice to individuals, corporations, pension and profit
sharing plans and trust accounts since 1898, and is the oldest, independent
registered investment advisor in the United States.
In return for its services, the Advisor receives a monthly fee from each
Fund, computed and accrued daily, based on the Fund's average net assets. For
the year ended March 31, 1995, the Bartlett Basic Value Fund paid the Advisor a
fee equal to 1.20% of its daily net assets; the Bartlett Fixed Income Fund paid
the Advisor a fee equal to 1.00% of its average daily net assets; the Bartlett
Value International Fund paid the Advisor a fee equal to 1.83% of its average
daily net assets; the Bartlett Short Term Bond Fund paid the Advisor a fee
equal to .85% of its average daily net assets; and the Bartlett Cash Reserves
Fund paid the Advisor a fee equal to .78% of its average daily net assets.
Unlike most other mutual funds, the management fees paid by the Funds to
the Advisor include transfer agency, pricing, custodial, auditing and legal
services, and general administrative and other operating expenses. The Advisor
pays all of the expenses of each Fund except brokerage, taxes, interest and
extraordinary expenses. The rates of the advisory fees paid by most investment
companies to their investment advisors is lower than the rates of the advisory
fees paid by the Bartlett Value International Fund, the Bartlett Basic Value
Fund, the Bartlett Fixed Income Fund, the Bartlett Short Term Bond Fund and the
Bartlett Cash Reserves Fund. In this regard, it should be noted that most
investment companies pay their own operating expenses, while each Fund's
expenses (except those specified above) are paid by the Advisor. In addition,
the expenses of the Bartlett Value International Fund, like those of other
international funds, generally can be expected to be higher than expenses of
investment companies investing in domestic securities due to the greater costs
of custody, communications and investment advisory services for foreign
securities.
The Trusts also retain Bartlett & Co. to serve as transfer agent,
dividend paying agent and shareholder service agent.
Because the Board of Trustees of each Trust believes that in certain
circumstances it is more efficient to place portfolio transactions with the
Advisor than with other brokers and dealers, each Fund may pay brokerage
commissions to the Advisor. Each Fund may also pay brokerage commissions to
any broker which is an affiliate of the Advisor, or an affiliate of which is an
affiliate of the Advisor or either Trust. Consistent with the Rules of Fair
Practice of the National Association of Securities Dealers, Inc., and subject
to its obligation of seeking best qualitative execution, the Advisor may also
give consideration to
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sales of shares of the Funds as a factor in the selection of brokers and
dealers to execute portfolio transactions. In addition, registered
representatives of broker/dealers (including Bartlett & Co.) may receive
compensation from the broker/dealer based upon the number of shares of the
Funds purchased by clients of such broker-dealers.
THE BARTLETT MUTUAL FUNDS PORTFOLIO MANAGERS
Dale H. Rabiner, CFA, Chairman of the Board of Trustees and Vice
President of the Bartlett Capital Trust and a Trustee and Vice President of the
Bartlett Management Trust, is responsible for managing the portfolios of the
Bartlett Fixed Income Fund, the Bartlett Short Term Bond Fund and the Bartlett
Cash Reserves Fund. Mr. Rabiner is a Senior Portfolio Manager and a Managing
Director of the Advisor. Mr. Rabiner has been employed by the Advisor since
1983 and has served since then as Director of its Fixed Income Group. Prior
thereto, Mr. Rabiner was affiliated for seven years with another investment
advisor and the investment companies managed by it. In managing the Fund's
portfolio, Mr. Rabiner works closely with other members of the Advisor's Fixed
Income Group who specialize in fixed income securities.
James A. Miller, CFA, Vice President of the Bartlett Capital Trust, and
Woodrow H. Uible, CFA, Vice President of the Bartlett Capital Trust, are
responsible for co-managing the portfolio of the Bartlett Basic Value Fund.
Mr. Miller is a Senior Portfolio Manager, President and a Managing Director of
the Advisor. Mr. Miller joined the Advisor in 1977, and is a member of its
Institutional Investment Group. Mr. Uible is a Senior Portfolio Manager and a
member of the Board of Directors of the Advisor. Mr. Uible has been employed
by the Advisor since 1980. He chairs the Advisor's Equity Investment Group,
and is responsible for the Advisor's equity investment processes. Messrs.
Miller and Uible work closely with other members of the Advisor's Equity
Investment and Institutional Investment Groups who specialize in equity
securities.
Madelynn M. Matlock, CFA, Vice President of the Bartlett Capital Trust,
is primarily responsible for managing the portfolio of the Bartlett Value
International Fund. Ms. Matlock, Director of International Investment for the
Advisor, joined the Advisor in 1981. She also served as Director of Research
for the Advisor from 1983 to 1992.
CALCULATION OF SHARE PRICE
The share prices (net asset values) of the Bartlett Value International
Fund, the Bartlett Basic Value Fund, the Bartlett Fixed Income Fund and the
Bartlett Short Term Bond Fund are
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calculated once daily, as of the close of trading on the New York Stock
Exchange (generally, 4:00 p.m., New York time), on each day the Trust and the
custodian of the applicable Fund are open for business. The net asset value of
shares of the Bartlett Cash Reserves Fund is calculated twice daily as of 12:00
p.m. and 4:00 p.m., New York time, on any day when the Trusts and the Fund's
custodian are open for business. The price of the shares of a Fund will also
be calculated on other days if there is sufficient trading in the Fund's
portfolio securities that its net asset value might be materially affected.
The net asset value per share of each Fund is computed by dividing the sum of
the value of the securities held by the Fund plus any cash or other assets
minus all liabilities (including estimated accrued expenses) by the total
number of shares outstanding at such time, rounded to the nearest cent. For
the Bartlett Cash Reserves Fund, which is a money market fund, this is known as
the penny-rounding method of pricing.
Equity securities, options and commodities listed on exchanges are valued
at the last sale price as of the close of business on the day the securities
are being valued. Listed securities not traded on a particular day and
securities traded in the over-the- counter market are valued at the mean
between closing bid and ask prices quoted by brokers or dealers that make
markets in the securities. Portfolio securities which are traded both in the
over-the-counter market and on an exchange are valued according to the broadest
and most representative market.
Fixed income securities generally are valued by using market quotations,
or independent pricing services which use prices provided by market makers or
estimates of market values. However, if the Advisor believes the market value
of a security will be more accurately reflected thereby, it will use market
value estimates obtained from yield spreads relating to securities with similar
characteristics as to credit quality, coupon rate, maturity and other factors.
Fixed income securities having a maturity of less than 60 days (except
for those in the Bartlett Cash Reserves Fund) are valued at amortized cost.
Securities and other assets of a Fund for which market quotations are not
readily available are valued at fair value as determined in good faith by the
Advisor, subject to review of the Board of Trustees. Any of the Funds may use
pricing services to determine the market value of its portfolio securities,
subject to the Advisor's review. If the Board of Trustees determines in good
faith that another method of valuing options and futures contracts is necessary
to appraise their fair value, such other method will be used.
For valuation purposes, quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents at the time of pricing. In
computing the net asset value of a Fund,
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the values of foreign portfolio securities are generally based upon market
quotations which, depending upon the exchange or market, may be last sale
price, last bid price, or the mean between last bid and asked prices as of, in
each case, the close of the appropriate exchange or another designated time.
Trading in securities on European and Far Eastern securities exchanges
and over-the-counter markets is normally completed at various times before the
close of business on each day on which the NYSE is open. Trading of these
securities may not take place on every NYSE business day. In addition, trading
may take place in various foreign markets on Saturdays or on other days when
the NYSE is not open and on which a Fund's share price is not calculated.
Therefore, the value of the portfolio of a Fund holding foreign securities may
be significantly affected on days when shares of the Fund may not be purchased
or redeemed.
The calculation of the share price of a Fund holding foreign securities
in its portfolio does not take place contemporaneously with the determination
of the values of many of the foreign portfolio securities used in such
calculation. Events affecting the values of foreign portfolio securities that
occur between the time their prices are determined and the calculation of the
Fund's share price will not be reflected in the calculation unless the Advisor
determines, subject to review by the Board of Trustees, that the particular
event would materially affect net asset value, in which case an adjustment will
be made.
DIVIDENDS AND DISTRIBUTIONS
Each Fund intends to distribute substantially all of its net investment
income, if any, in the form of dividends to its shareholders. The Bartlett
Value International Fund and the Bartlett Basic Value Fund each intend to
declare and pay dividends on a quarterly basis. The Bartlett Fixed Income
Fund, the Bartlett Short Term Bond Fund and the Bartlett Cash Reserves Fund
each intend to declare dividends daily and pay them monthly. Each Fund intends
to distribute net long term and net short term capital gains, if any, at least
once a year.
Distributions from each Fund are made pursuant to one of the following
options:
SHARE OPTION. Income distributions and capital gains distributions
reinvested in additional shares.
INCOME OPTION. Income distributions in cash; capital gains
distributions reinvested in additional shares.
CASH OPTION. Income distributions and capital gains distributions in
cash.
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You should indicate your choice of options on the application. If no
option is specified on your application, distributions will automatically be
reinvested in additional shares. You may change the option you have chosen by
sending a written request to Bartlett Mutual Funds indicating the Fund(s) for
which the change in option is requested. All distributions (regardless of the
option you select) will be based on the share price in effect on the payable
date. Reinvestment of distributions in additional shares are also made on the
payable date; however, distributions in cash may be mailed to the shareholder
several days subsequent to the payable date.
TAXES
Each Fund has qualified and intends to qualify each year as a "regulated
investment company" under federal tax law. By so qualifying, the Fund will not
be subject to federal income taxes to the extent that it distributes
substantially all of its net investment income and any realized capital gains.
For federal income tax purposes, each Fund is treated as a separate
entity for the purpose of computing taxable net income and net realized capital
gains and losses. Dividends paid by each Fund from ordinary income are taxable
to shareholders as ordinary income, but may be eligible in part for the
dividends received deduction for corporations. Any distributions designated as
being made from net realized long term capital gains are taxable to
shareholders as long term capital gains regardless of the holding period of the
shareholder. The tax consequences described in this section apply whether
distributions are taken in cash or reinvested in additional shares.
Each Fund will mail a statement to each shareholder setting forth the
federal income tax status of distributions made during the year. Dividends and
capital gains distributions also may be subject to state and local taxes.
Income received by the Bartlett Value International Fund and any other
Fund holding foreign securities may be subject to foreign tax withholding. Tax
treaties between certain countries and the U.S. may reduce or eliminate such
taxes. Shareholders may be entitled to claim tax credits or deductions,
subject to provisions and limitations of the Internal Revenue Code, for foreign
income taxes paid by the Fund. The Fund will notify its shareholders if such
credit or deduction is available.
Shareholders of each Fund are urged to consult their own tax advisers
regarding specific questions as to federal, state or local taxes, applicable
foreign tax credits and deductions and
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the tax effect of distributions, redemptions and the use of the Exchange
Privilege.
Unless a shareholder of a Fund furnishes his certified taxpayer
identification number (social security number for individuals) and certifies
that he is not subject to backup withholding, the Fund will be required to
withhold and remit to the U.S. Treasury 31% of the dividend, distributions and
redemption proceeds payable to the shareholder. Shareholders should be aware
that, under regulations promulgated by the Internal Revenue Service, a Fund may
be fined $50 annually for each account for which a certified taxpayer
identification number is not provided. In the event that such a fine is
imposed with respect to a specific account in any year, the Fund will make a
corresponding charge against the account.
INVESTMENT POLICIES, TECHNIQUES AND RISK CONSIDERATIONS
This section contains general information about various types of
securities and investment techniques. Each Fund may invest in any security or
employ any investment technique described in this section unless specifically
noted otherwise. Each Fund may purchase combinations of different types of
securities provided that the securities in the combination are permissible
investments of the Fund.
EQUITY SECURITIES
Each Fund (other than the Bartlett Cash Reserves Fund) may invest in
equity securities. Equity securities include common stock, preferred stock and
common stock equivalents such as convertible preferred stock, convertible
debentures, rights and warrants.
CONVERTIBLE PREFERRED STOCK is preferred stock that can be converted into
common stock pursuant to its terms. CONVERTIBLE DEBENTURES are debt
instruments that can be converted into common stock pursuant to their terms.
WARRANTS are options to purchase equity securities at a specified price
valid for a specific time period. RIGHTS are similar to warrants, but normally
have a short duration and are distributed by the issuer to its shareholders. A
Fund may not invest more than 5% of its assets at the time of purchase in
rights and warrants other than those that have been acquired in units or
attached to other securities. No more than 2% of assets at the time of
purchase may be invested in warrants which are not listed on either the New
York Stock Exchange or the American Stock Exchange.
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FIXED INCOME SECURITIES
Fixed income securities include corporate debt securities, municipal
obligations, mortgage related securities, asset-backed and receivable-backed
securities, U.S. government obligations and participation interests in such
securities. Certain fixed income securities are floating rate obligations or
variable rate obligations. Certain fixed income securities may carry demand
features that permit a Fund to sell the obligation back to the issuer or to a
third party at a specified price upon short notice at any time or prior to
specific dates. Preferred stock and certain common stock equivalents may also
be considered to be fixed income securities. Financial service industry
obligations are fixed income securities issued by a specific industry. Under
normal circumstances, at least 65% of the total assets of the Bartlett Fixed
Income Fund will be invested in fixed income securities other than floating
rate and variable rate obligations.
CORPORATE DEBT SECURITIES AND MUNICIPAL OBLIGATIONS. Each Fund is
permitted to invest in CORPORATE DEBT SECURITIES, i.e., long-term and
short-term debt obligations issued by companies (such as publicly issued and
privately placed bonds, notes and commercial paper). Corporate debt securities
include variable amount master demand notes. These obligations permit the
investment of fluctuating amounts at varying rates of interest pursuant to
direct arrangements between a Fund, as lender, and the borrower. Variable
amount master demand notes are direct lending arrangements between the lender
and borrower and are not generally transferable. A Fund may invest in such
notes only if the Board of Trustees believes that the notes are of comparable
quality to the other obligations in which the Fund may invest. Variable amount
master demand notes may be deemed illiquid under certain circumstances and a
Fund's investment in such notes would be limited to the extent that it is not
permitted to invest more than 10% of the value of its net assets in illiquid
investments.
Each Fund is also permitted to invest in municipal obligations.
MUNICIPAL OBLIGATIONS are debt obligations issued by or on behalf of states,
territories and possessions of the United States and the District of Columbia,
and their political subdivisions, agencies, authorities and instrumentalities
and other qualifying issuers which pay interest that is, in the opinion of bond
counsel to the issuer, exempt from federal income tax. Each Fund may also
invest less than 5% of its total assets in participation interests in municipal
obligations.
Each Fund (except the Bartlett Cash Reserves Fund--see "Portfolio
Management Policies for the Bartlett Cash Reserves Fund" and the Bartlett Short
Term Bond Fund) may invest in debt obligations (such as corporate debt
securities and municipal obligations) in any rating category of the recognized
rating
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services, including issues that are in default, and may invest in unrated debt
obligations. Most foreign debt obligations are not rated (see "Foreign
Securities").
SECURITIES RATINGS. Generally, investments in securities in the lower
rating categories or comparable unrated securities provide higher yields but
involve greater price volatility and risk of loss of principal and interest
than investments in securities with higher ratings. Securities rated lower
than Baa by Moody's or BBB by Standard & Poor's (commonly known as "junk
bonds") are below investment grade and have speculative characteristics. None
of the Funds intends to invest more than 5% of its portfolio in securities
below investment grade; neither the Bartlett Short Term Bond Fund nor the
Bartlett Cash Reserves Fund may purchase any securities that are below
investment grade at the time of purchase.
Lower ratings reflect a greater possibility that an adverse change in
financial condition will affect the ability of the issuer to make payments of
principal and interest than is the case with higher grade securities. In
addition, lower-rated securities will also be affected by the market's
perception of their credit quality and the outlook for economic growth. In
the past, economic downturns or an increase in interest rates have under
certain circumstances caused a higher incidence of default by the issuers of
these securities and may do so in the future, especially in the case of highly
leveraged issuers. The prices for these securities may be affected by
legislative and regulatory developments. For example, new federal rules
require that savings and loan associations gradually reduce their holdings of
high yield securities. An effect of such legislation may be to significantly
depress the prices of outstanding lower- rated securities. The market for
lower-rated securities may be less liquid than the market for securities with
higher ratings. Furthermore, the liquidity of lower-rated securities may be
affected by the market's perception of their credit quality. Therefore,
judgment may at times play a greater role in valuing these securities than in
the case of higher-rated securities, and it also may be more difficult during
certain adverse market conditions to sell lower- rated securities at their fair
value to meet redemption requests or to respond to changes in the market.
Although the above risks apply to all lower-rated securities, the
investment risk increases when the rating of the security is below investment
grade. The lowest-rated securities (D by S&P and C by Moody's) are regarded as
having extremely poor prospects of ever attaining any real investment standing,
and, in fact, may be in default of payment of interest or repayment of
principal. To the extent a Fund (other than the Bartlett Short Term Bond Fund
and the Bartlett Cash Reserves Fund) invests in these lower rated securities,
the achievement of its investment objective may be more dependent on the
Advisor's own credit
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analysis than in the case of a Fund investing in higher-rated securities.
Each Fund (other than the Bartlett Short Term Bond Fund and the Bartlett
Cash Reserves Fund) may invest in securities which are in lower rating
categories or are unrated if the Advisor determines that the securities provide
the opportunity of meeting the Fund's objective without presenting excessive
risk. The Advisor will consider all factors which it deems appropriate,
including ratings, in making investment decisions for a Fund and will attempt
to minimize investment risks through diversification, investment analysis and
monitoring of general economic conditions and trends. While the Advisor may
refer to ratings, it does not rely exclusively on ratings, but makes its own
independent and ongoing review of credit quality.
LOAN PARTICIPATION INTERESTS. Loan participation interests are interests
in debt obligations (such as corporate loans) that are owned by banks or other
financial institutions. Loan participation interests are subject to the credit
risks generally associated with the corporate borrower; however, certain loan
participation interests may be backed by irrevocable letters of credit or a
guarantee of the bank or financial institution. Certain loan participation
interests may carry demand features that permit a Fund to sell the obligations
back to the financial intermediaries for the full amount of the Fund's interest
in the debt obligation plus accrued interest upon short notice at any time or
prior to specific dates. In the event of a default by the corporate borrower,
a Fund may be required to assert its rights through the financial intermediary
which may subject the Fund to delays, expenses and risks that are greater than
those that would have been involved if the Fund had purchased a direct
obligation (such as commercial paper) of such borrower. Moreover, under the
terms of the loan participation the Fund may be regarded as a creditor of the
bank or financial institution (rather than of the corporate borrower), so that
the Fund may also be subject to the risk that the financial intermediary may
become insolvent. Further, in the event of the bankruptcy or insolvency of the
corporate borrower, the loan participation may be subject to certain defenses
that can be asserted by such borrower as a result of improper conduct by the
financial intermediary. Loan participation interests which do not carry
unconditional demand features that can be exercised within seven days or less
are deemed illiquid and a Fund's investment in such interests would be limited
to the extent that it is not permitted to invest more than 10% of the value of
its net assets in illiquid investments.
MORTGAGE-RELATED SECURITIES. Each Fund may invest in mortgage-related
securities. Mortgage-related securities provide capital for mortgage loans
made to residential homeowners, including securities which represent interests
in pools of
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mortgage loans made by lenders such as savings and loan institutions, mortgage
bankers, commercial banks and others. Pools of mortgage loans are assembled
for sale to investors (such as the Funds) by various governmental,
government-related and private organizations, such as dealers. The market
value of mortgage-related securities will fluctuate as a result of changes in
interest rates and mortgage rates.
Interests in pools of mortgage loans generally provide a monthly payment
which consists of both interest and principal payments. In effect, these
payments are a "pass-through" of the monthly payments made by the individual
borrowers on their residential mortgage loans, net of any fees paid to the
issuer or guarantor of such securities. Additional payments are caused by
repayments of principal resulting from the sale of the underlying residential
property, refinancing or foreclosure, net of fees or costs which may be
incurred. Some mortgage-related securities (such as securities issued by the
Government National Mortgage Association) are described as "modified
pass-through" because they entitle the holder to receive all interest and
principal payments owed on the mortgage pool, net of certain fees, regardless
of whether the mortgagor actually makes the payment.
Commercial banks, savings and loan institutions, private mortgage
insurance companies, mortgage bankers and other secondary market issuers, such
as dealers, create pass-through pools of conventional residential mortgage
loans. Such issuers also may be the originators of the underlying mortgage
loans as well as the guarantors of the mortgage-related securities. Pools
created by such non-governmental issuers generally offer a higher rate of
interest than government and government-related pools because there are no
direct or indirect government guarantees of payments with respect to such
pools. However, timely payment of interest and principal of these pools is
supported by various forms of insurance or guarantees, including individual
loan, title, pool and hazard insurance. There can be no assurance that the
private insurers can meet their obligations under the policies. A Fund may buy
mortgage-related securities without insurance or guarantees if, through an
examination of the loan experience and practices of the persons creating the
pools, the Advisor determines that the securities are appropriate investments
for the Fund.
Another type of security representing an interest in a pool of mortgage
loans is known as a collateralized mortgage obligation ("CMO"). CMOs represent
interests in a short term, intermediate term or long term portion of a mortgage
pool. Each portion of the pool receives monthly interest payments, but the
principal repayments pass through to the short term CMO first and the long term
CMO last. A CMO permits an investor to more accurately predict the rate of
principal repayments. CMOs are issued by private issuers, such as broker
dealers, and government
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agencies, such as the Federal National Mortgage Association and the Federal
Home Loan Mortgage Corporation. Investments in CMOs are subject to the same
risks as direct investments in the underlying mortgage-backed securities. In
addition, in the event of a bankruptcy or other default of a broker who issued
the CMO held by a Fund, the Fund could experience both delays in liquidating
its position and losses. Each Fund (other than the Bartlett Short Term Bond
Fund and the Bartlett Cash Reserves Fund) may invest in CMOs in any rating
category of the recognized rating services and may invest in unrated CMOs.
Each Fund may also invest in "stripped" CMOs, which represent only the income
portion or the principal portion of the CMO.
The Advisor expects that governmental, government-related or private
entities may create mortgage loan pools offering pass-through investments in
addition to those described above. The mortgages underlying these securities
may be second mortgages or alternative mortgage instruments (for example,
mortgage instruments whose principal or interest payments may vary or whose
terms to maturity may differ from customary long-term fixed rate mortgages).
As new types of mortgage-related securities are developed and offered to
investors, the Advisor will, consistent with a Fund's investment objective and
policies, consider making investments in such new types of securities. The
Prospectus of a Fund will be amended with any necessary additional disclosure
prior to the Fund investing in such securities.
The average life of securities representing interests in pools of
mortgage loans is likely to be substantially less than the original maturity of
the mortgage pools as a result of prepayments or foreclosures of such
mortgages. Prepayments are passed through to the registered holder with the
regular monthly payments of principal and interest, and have the effect of
reducing future payments. To the extent the mortgages underlying a security
representing an interest in a pool of mortgages are prepaid, a Fund may
experience a loss (if the price at which the respective security was acquired
by the Fund was at a premium over par, which represents the price at which the
security will be redeemed upon prepayment) or a gain (if the price at which the
respective security was acquired by the Fund was at a discount from par). In
addition, prepayments of such securities held by a Fund will reduce the share
price of the Fund to the extent the market value of the securities at the time
of prepayment exceeds their par value, and will increase the share price of the
Fund to the extent the par value of the securities exceeds their market value
at the time of prepayment. Prepayments may occur with greater frequency in
periods of declining mortgage rates because, among other reasons, it may be
possible for mortgagors to refinance their outstanding mortgages at lower
interest rates.
Although the market for mortgage-related securities issued by private
organizations is becoming increasingly liquid, such
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securities may not be readily marketable. No Fund will purchase
mortgage-related securities for which there is no established market (including
CMOs and direct investments in mortgages as described below) or any other
investments which the Advisor deems to be illiquid pursuant to criteria
established by the Board of Trustees if, as a result, more than 10% of the
value of the Fund's net assets would be invested in such illiquid securities
and investments.
Mortgage-related securities include investments made directly in
mortgages secured by real estate. When a Fund makes a direct investment in
mortgages, the Fund, rather than a financial intermediary, becomes the
mortgagee with respect to such loans purchased by the Fund.
ASSET-BACKED AND RECEIVABLE-BACKED SECURITIES. Each Fund is permitted to
invest in asset-backed and receivable-backed securities. Several types of
asset-backed and receivable-backed securities are available to investors,
including CARs(SM) (Certificates for Automobile Receivables(SM)) and interests
in pools of credit card receivables. CARs(SM) represent a pool (the "Pool") of
motor vehicle retail installment sales contracts and security interests in the
vehicles securing the contracts. Payments of principal and interest on
CARs(SM) are passed through monthly to certificate holders. Such payments may
be guaranteed up to certain amounts and for a certain time period by a letter
of credit issued by a financial institution unaffiliated with the Pool. Early
prepayment of principal on the underlying vehicle sales contracts may reduce
the overall return to an investor. If the letter of credit is exhausted and if
the full amount of the underlying sales contracts are not repaid, certificate
holders may experience losses on CARs(SM) or delays in payment. Certificates
representing pools of credit card receivables have characteristics similar to
CARs(SM), however, the underlying receivables are not secured.
Consistent with each Fund's investment objective and subject to the
review and approval of the Board of Trustees, each Fund also may invest in
other types of asset-backed and receivable-backed securities. The Prospectus
of a Fund will be amended with any necessary additional disclosure prior to the
Fund investing in such securities.
FLOATING AND VARIABLE RATE OBLIGATIONS. Fixed income securities may be
offered in the form of floating and variable rate obligations. FLOATING RATE
OBLIGATIONS have an interest rate which is fixed to a specified interest rate,
such as a bank prime rate, and is automatically adjusted when the specified
interest rate changes. VARIABLE RATE OBLIGATIONS have an interest rate which
is adjusted at specified intervals to a specified interest rate. Periodic
interest rate adjustments help stabilize the obligations' market values.
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A Fund may purchase these obligations from the issuers or may purchase
participation interests in pools of these obligations from banks or other
financial institutions. Variable and floating rate obligations usually carry
demand features that permit a Fund to sell the obligations back to the issuers
or to financial intermediaries at par value plus accrued interest upon short
notice at any time or prior to specific dates. The inability of the issuer or
financial intermediary to repurchase an obligation on demand could affect the
liquidity of the Fund's portfolio. Frequently, obligations with demand
features are secured by letters of credit or comparable guarantees. The
Bartlett Cash Reserves Fund determines maturity of variable and floating rate
securities in accordance with Securities and Exchange Commission rules
applicable to money market funds which allow the Fund to consider certain of
such instruments as having maturities shorter than the maturity date on the
face of the instrument. Floating and variable rate obligations which do not
carry unconditional demand features that can be exercised within seven days or
less are deemed illiquid unless the Board determines otherwise. A Fund's
investment in illiquid floating and variable rate obligations would be limited
to the extent that it is not permitted to invest more than 10% of the value of
its net assets in illiquid investments.
FINANCIAL SERVICE INDUSTRY OBLIGATIONS. Fixed income securities issued
by domestic and foreign banks, domestic savings and loan associations, consumer
and industrial finance companies, securities brokerage companies, real
estate-related companies, leasing companies, and a variety of firms in all
segments of the insurance field such as multiline, property and casualty, and
life insurance are referred to in this Prospectus as financial service industry
obligations. Such obligations include certificates of deposit, bankers'
acceptances and other debt obligations. Each Fund may invest in financial
service industry obligations. The financial services industry is subject to
extensive governmental regulations which may limit both the amounts and types
of loans which may be made and interest rates which may be charged. In
addition, the profitability of the industry is largely dependent upon the
availability and cost of funds for lending purposes, general economic
conditions and exposure to credit losses arising from possible financial
difficulties of borrowers. Those financial services companies which are
engaged in insurance underwriting may be exposed to adverse competitive
conditions which may result in underwriting losses. If a Fund's portfolio
contains obligations issued by foreign branches of U.S. banks or those issued
by foreign banks, it may be subject to additional investment risks. For
example, possible actions by foreign governments, including the adoption of
governmental restrictions, nationalization of foreign deposits or establishment
of exchange controls, might adversely affect the payment of principal and
interest on the obligations issued by those branches. In addition, foreign
branches of U.S. banks and
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foreign banks are not subject to all of the federal and state laws and
regulations applicable to U.S. banks. The risks associated with investments in
this industry are particularly relevant to the Bartlett Cash Reserves Fund
because under normal market conditions its investments will be concentrated in
the industry.
U.S. GOVERNMENT OBLIGATIONS AND RELATED SECURITIES. U.S. government
obligations include a variety of securities which are issued or guaranteed by
the United States Treasury, by various agencies of the United States government
or by various instrumentalities that have been established or sponsored by the
United States government. U.S. Treasury securities and securities issued by
the Government National Mortgage Association and Small Business Administration
are backed by the "full faith and credit" of the United States government.
Other U.S. government obligations may or may not be backed by the "full faith
and credit" of the United States. In the case of securities not backed by the
"full faith and credit" of the United States, the investor must look
principally to the agency issuing or guaranteeing the obligation (such as the
Federal Farm Credit System, the Federal Home Loan Banks, the Federal National
Mortgage Association and the Federal Home Loan Mortgage Corporation) for
ultimate repayment, and may not be able to assert a claim against the United
States itself in the event the agency or instrumentality does not meet its
commitments.
Participation interests in U.S. government obligations are pro rata
interests in such obligations which are generally underwritten by government
securities dealers. Certificates of safekeeping for U.S. government
obligations are documentary receipts for such obligations. Both participation
interests and certificates of safekeeping are traded on exchanges and in the
over-the-counter market.
Each Fund may invest in U.S. government obligations and related
participation interests. In addition, each Fund may invest in custodial
receipts that evidence ownership of future interest payments, principal
payments or both on certain U.S. government obligations. Such obligations are
held in custody by a bank on behalf of the owners. These custodial receipts
are known by various names, including Treasury Receipts, Treasury Investors
Growth Receipts ("TIGRs") and Certificates of Accrual on Treasury Securities
("CATS"). Custodial receipts generally are not considered obligations of the
U.S. government for purposes of securities laws. The Funds will consider all
interest-only or principal-only fixed income securities as illiquid.
STRUCTURED SECURITIES. Each of the Funds (except the Bartlett Value
International Fund and the Bartlett Cash Reserves Fund) may invest in
structured securities which are derived from
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securities which are issued by U.S. government agencies and are denominated in
U.S. dollars. These short maturity notes differ from traditional government
agency securities in that the return (principal and/or interest) is linked to
the performance of a diversified array of financial indices.
An investment in structured securities entails risks not associated with
investments in conventional debt securities. However, the Funds use these
securities only as a hedge or to protect a Fund portfolio against rising
interest rates. Structured securities are privately issued securities, although
they are traded in the secondary market. The secondary market for such
securities is affected by factors independent of the creditworthiness of the
issuer and the value of the index, such as the volatility of the index, time
remaining to maturity and the amount of such securities outstanding.
FOREIGN SECURITIES
FOREIGN EQUITY SECURITIES include common stock, preferred stock and
common stock equivalents issued by foreign companies. Each Fund (other than
the Bartlett Cash Reserves Fund) may invest, without limitation, in foreign
equity securities.
American Depositary Receipts ("ADRs"), European Depositary Receipts
("EDRs") and other similar securities convertible into securities of foreign
companies provide a means for investing indirectly in foreign equity
securities. ADRS are receipts typically issued by a U.S. bank evidencing
ownership of the underlying foreign securities. EDRS are receipts typically
issued by a European bank evidencing ownership of the underlying foreign
securities. To the extent the ADR or EDR is issued by a bank unaffiliated with
the foreign company issuer of the underlying security, the bank has no
obligation to disclose material information about the foreign company issuer.
In addition, the Bartlett Value International Fund may invest in any
closed-end investment company that holds foreign equity securities in its
portfolio provided the securities held by such investment company are otherwise
permitted investments for the Fund.
FOREIGN FIXED INCOME SECURITIES include corporate debt obligations issued
by foreign companies and debt obligations of foreign governments or
international organizations. This category may include floating rate
obligations, variable rate obligations, Yankee dollar obligations (U.S. dollar
denominated obligations issued by foreign companies and traded on U.S. markets)
and Eurodollar obligations (U.S. dollar denominated obligations issued by
foreign companies and traded on foreign markets). To the extent that the
Bartlett Fixed Income Fund and
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the Bartlett Short Term Bond Fund invest in foreign securities, they intend to
invest only in securities of developed countries.
FOREIGN GOVERNMENT OBLIGATIONS generally consist of debt securities
supported by national, state or provincial governments or similar political
units or governmental agencies. Such obligations may or may not be backed by
the national government's full faith and credit and general taxing powers.
Investments in foreign securities also include OBLIGATIONS ISSUED BY
INTERNATIONAL ORGANIZATIONS. International organizations include entities
designated or supported by governmental entities to promote economic
reconstruction or development as well as international banking institutions and
related government agencies. Examples are the International Bank for
Reconstruction and Development (the World Bank), the European Coal and Steel
Community, the Asian Development Bank and the InterAmerican Development Bank.
In addition, investments in foreign securities may include debt securities
denominated in multinational currency units of an issuer (including
international issuers). An example of a multinational currency unit is the
European Currency Unit. A European Currency Unit represents specified amounts
of the currencies of certain member states of the European Economic Community,
more commonly known as the Common Market.
Each Fund may include foreign fixed income securities and foreign
government obligations securities in its portfolio. The Bartlett Value
International Fund under normal conditions will invest at least 65% of its
assets in foreign securities. For purposes of this 65% test, foreign
securities includes securities of issuers: (1) which are organized under the
laws of a foreign country; (2) for which the principal trading market is in a
foreign country; or (3) which derive at least 50% of their revenues or profits
from goods produced or sold, investments made, or services performed in foreign
countries or which have at least 50% of their assets situated in foreign
countries.
Purchases of foreign securities are usually made in foreign currencies
and, as a result, a Fund may incur currency conversion costs and may be
affected favorably or unfavorably by changes in the value of foreign currencies
against the U.S. dollar. However, since the Bartlett Cash Reserves Fund may
only purchase U.S. dollar denominated foreign securities, it will not be
subject to these risks. In addition, there may be less information publicly
available about a foreign company than about a U.S. company, and foreign
companies are not generally subject to accounting, auditing and financial
reporting standards and practices comparable to those in the U.S. Other risks
associated with investments in foreign securities include changes in
restrictions on foreign currency transactions and rates of exchanges, changes
in the administrations or economic and monetary policies of foreign
governments, the imposition of exchange control regulations, the possibility of
expropriation
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decrees and other adverse foreign governmental action, the imposition of
foreign taxes, less liquid markets, less government supervision of exchanges,
brokers and issuers, difficulty in enforcing contractual obligations, delays in
settlement of securities transactions and greater price volatility. In
addition, investing in foreign securities will generally result in higher
commissions than investing in similar domestic securities.
OPTION TRANSACTIONS
The Bartlett Basic Value Fund, the Bartlett Fixed Income Fund and the
Bartlett Short Term Bond Fund may engage in option transactions involving
equity securities, debt securities, futures contracts and stock indexes. The
Bartlett Value International Fund may engage in option transactions involving
foreign currencies, foreign stock indexes and futures contracts. The Bartlett
Cash Reserves Fund may not engage in option transactions.
To cover the potential obligations involved in option transactions, a
Fund will own the underlying equity security, debt security, futures contract
or foreign currency or the Fund will segregate with the Custodian (a) high
grade liquid debt assets sufficient to purchase the underlying equity security,
debt security, futures contract or foreign currency or (b) high grade liquid
debt assets equal to the market value of the stock index. A Fund will only
engage in options on futures contracts for hedging purposes (see "Hedging
Program" below). Option transactions involve the following principal risks:
(a) the loss of a greater percentage of the Fund's investment than a direct
investment in the underlying instrument, (b) the loss of opportunity to profit
from price movements in the underlying instrument, and (c) the inability to
effect a closing transaction on a particular option.
There is no restriction on the percentage of a Fund's total assets which
may be committed to transactions in options (except options on futures
contracts as discussed below and as indicated in the "State Restrictions"
section of the applicable Statement of Additional Information). However, the
Securities and Exchange Commission considers over-the-counter options to be
illiquid. As long as the Commission maintains this position, a Fund will not
engage in an over-the-counter option transaction if such transaction would
cause the value of such options purchased by the Fund and the assets used to
cover such options written (sold) by the Fund, together with the value of other
illiquid securities held by the Fund, to exceed 10% of the net assets of the
Fund. The policy of each Fund with respect to options is fundamental, although
the particular practices followed with respect to options, such as the
procedures used to cover or secure options
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which a Fund writes, are not deemed fundamental and may be changed by the Board
of Trustees without shareholder vote.
A more complete description of the characteristics, risks and possible
benefits of option transactions is included in the Funds' Statements of
Additional Information.
HEDGING PROGRAM
Any Fund (except the Bartlett Cash Reserves Fund) may hedge all or a
portion of its portfolio investments through the use of options, futures
contracts and options on futures contracts. Any Fund (except the Bartlett Cash
Reserves Fund) may hedge currency risks associated with investments in foreign
securities and in particular may hedge its portfolio through the use of forward
foreign currency transactions as described below. The objective of a hedging
program is to protect a profit or offset a loss in a portfolio security from
future price erosion or to assure a definite price for a security, stock index,
futures contract or currency. There are transactional costs connected with a
hedging program.
The principal risks associated with hedging transactions are: (a)
possible imperfect correlation between the prices of the options and futures
contracts and the market value of a Fund's portfolio securities, (b) possible
lack of a liquid secondary market for closing out an option or futures contract
transaction, (c) the need for additional skills and techniques beyond normal
portfolio management, and (d) losses resulting from market movements not
anticipated by the Advisor.
No Fund may purchase or sell futures contracts or purchase related
options if, immediately thereafter, more than one-third of its net assets would
be hedged. In addition, no Fund may enter into transactions involving futures
contracts and related options if such transactions would result in more than 5%
of the fair market value of the Fund's assets being deposited as initial margin
for such transactions. A Fund's ability to engage in the hedging transactions
and strategies described above may be limited by the tax requirement that the
Fund derive less than 30% of its gross income from the sale or other
disposition of stock or securities held for less than three months.
A more complete description of the characteristics, risks and possible
benefits of hedging transactions is included in the Statement of Additional
Information.
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FOREIGN CURRENCY TRANSACTIONS
Each Fund (other than the Bartlett Cash Reserves Fund) can purchase
securities denominated in a foreign currency. When a Fund purchases or sells a
security denominated in a foreign currency, it may be required to settle the
purchase transaction in the relevant foreign currency or to receive the
proceeds of the sale in the relevant foreign currency. In either event, the
Fund will be obligated to acquire or dispose of the foreign currency by selling
or buying an equivalent amount of U.S. dollars. To effect the conversion of
the amount of foreign currency involved in the purchase or sale of a foreign
security, the Fund may purchase or sell such foreign currency on a "spot"
(i.e., cash) basis.
In addition, the Fund may wish to lock in the U.S. dollar value of the
transaction at or near the time of the purchase or sale at the exchange rate or
rates then prevailing between the U.S. dollar and the currency in which the
foreign security is denominated. Therefore, the Fund may enter into a forward
foreign currency exchange contract. A forward foreign currency exchange
contract involves an obligation to purchase or sell a specific currency at a
future date, which may be any fixed number of days from the date of the
contract agreed upon by the parties, at a price set at the time of the
contract. These contracts are traded directly between currency traders
(usually large commercial banks) and their customers. By entering into a
forward contract in U.S. dollars for the purchase or sale of the amount of
foreign currency involved in an underlying security transaction, the Fund is
able to protect itself against a possible loss between trade and settlement
dates resulting from an adverse change in the relationship between the U.S.
dollar and such foreign currency. This process is known as transaction
hedging. Transaction hedging may protect the Fund from a possible loss, but
will limit potential gains which might result from a positive change in the
currency relationships.
Some or all of a Fund's portfolio securities (except those of the
Bartlett Cash Reserves Fund) may be denominated in foreign currencies. As a
result, in addition to the risk of change in the market value of portfolio
securities, the value of the portfolio in U.S. dollars is subject to
fluctuations in the exchange rate between such foreign currencies and the U.S.
dollar. When it is desirable to limit or reduce exposure in a foreign currency
in order to moderate potential changes in the U.S. dollar value of the
portfolio, the Fund may enter into a forward foreign currency exchange contract
to sell, for a fixed amount of U.S. dollars, the amount of foreign currency
approximating the value of some or all of the Fund's portfolio securities
denominated in such foreign currency. This technique is known as portfolio
hedging. Hedging against a decline in the value of currency does not eliminate
fluctuations in the prices
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of portfolio securities or prevent losses if the prices of such securities
decline. The Fund may also employ forward foreign currency exchange contracts
to hedge against an increase in the value of the currency in which the
securities the Fund intends to buy are denominated.
A Fund may also hedge its foreign currency exchange rate risk by engaging
in currency futures contracts and options transactions described above. No
Fund will engage in foreign currency transactions for speculative purposes.
INVESTMENT TECHNIQUES
REPURCHASE AGREEMENTS. Each Fund may enter into repurchase agreements.
Repurchase agreements are transactions by which a Fund purchases a security and
simultaneously commits to resell that security to the seller at an agreed upon
price and date. In the event of a bankruptcy or other default of the seller of
a repurchase agreement, the Fund could experience both delays in liquidating
the underlying security and losses. To minimize these possibilities, each Fund
intends to enter into repurchase agreements only with the Custodian, other
banks that serve as custodian for the Funds, banks having assets in excess of
$1 billion and primary government securities dealers determined by the Advisor
(subject to review by the Board of Trustees) to be creditworthy.
REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS. Each Fund (except the
Bartlett Value International Fund) may enter into reverse repurchase
agreements. Reverse repurchase agreements involve sales of portfolio
securities by a Fund to member banks of the Federal Reserve System or
recognized securities dealers, concurrently with an agreement by the Fund to
repurchase the same securities at a later date at a fixed price, which is
generally equal to the original sales price plus interest. The Fund retains
record ownership and the right to receive interest and principal payments on
the portfolio security involved. The Fund's objective in such a transaction
would be to obtain funds to pursue additional investment opportunities whose
yield would exceed the cost of the reverse repurchase transaction. Generally,
the use of reverse repurchase agreements should reduce portfolio turnover and
increase yield.
In connection with each reverse repurchase agreement, a Fund will direct
its Custodian to place cash or U.S.government obligations in a separate account
in an amount equal to the repurchase price. In the event of bankruptcy or
other default by the purchaser, the Fund could experience both delays in
repurchasing the portfolio securities and losses.
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Each Fund also may enter into DOLLAR ROLL TRANSACTIONS with certain
broker-dealers and banks. For all purposes (including borrowing restrictions)
the Funds treat dollar roll transactions as reverse repurchase agreements.
Dollar roll transactions consist of the sale by a Fund of mortgage-backed
securities combined with a commitment to purchase similar (although not
identical) securities at a future date at the same price. The Fund would
receive a fee for entering into the commitment to purchase. The principal risk
of dollar roll transactions is that if the broker-dealer or bank to whom the
Fund sells the securities underlying a dollar roll transaction becomes
insolvent, the Fund's right to purchase similar securities may be restricted.
Similarly, the value of the securities may change adversely over the term of
the dollar roll transaction and the securities that the Fund is required to
repurchase may be worth less than the securities originally held by the Fund.
Finally, the return earned by the Fund with the proceeds of a dollar roll
transaction may not exceed transaction costs.
LOANS OF PORTFOLIO SECURITIES. Each Fund may make short and long term
loans of its portfolio securities. Under the lending policy authorized by the
Board of Trustees and implemented by the Advisor in response to requests of
broker-dealers or institutional investors which the Advisor deems qualified,
the borrower must agree to maintain collateral, in the form of cash or U.S.
government obligations, with the Fund on a daily mark-to-market basis in an
amount at least equal to 100% of the value of the loaned securities. The Fund
will continue to receive dividends or interest on the loaned securities and may
terminate such loans at any time or reacquire such securities in time to vote
on any matter which the Board of Trustees determines to be serious. With
respect to loans of securities, there is the risk that the borrower may fail to
return the loaned securities or that the borrower may not be able to provide
additional collateral. No loan of securities will be made if, as a result, the
aggregate amount of such loans would exceed 25% of the value of the Fund's
total assets.
SHORT SALES. Each Fund (except the Bartlett Value International Fund)
may sell a security short in anticipation of a decline in the market value of
the security. When a Fund engages in a short sale, it sells a security which
it does not own. To complete the transaction, the Fund must borrow the
security in order to deliver it to the buyer. The Fund must replace the
borrowed security by purchasing it at the market price at the time of
replacement, which may be more or less than the price at which the Fund sold
the security. The Fund will incur a loss as a result of the short sale if the
price of the security increases between the date of the short sale and the date
on which the Fund replaces the borrowed security. The Fund will realize a
profit if the security declines in price between those dates.
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In connection with its short sales, a Fund will be required to maintain a
segregated account with its Custodian of cash or high grade liquid debt assets
equal to the market value of the securities sold less any collateral deposited
with its broker. The Fund will limit its short sales so that no more than 25%
of its net assets (less all its liabilities other than obligations under the
short sales) will be deposited as collateral and allocated to the segregated
account. However, the segregated account and deposits will not necessarily
limit the Fund's potential loss on a short sale, which is unlimited. Each
Fund's policy with respect to short sales is fundamental, although the
particular practices followed with respect to short sales, such as the
percentage of the Fund's assets which may be deposited as collateral or
allocated to the segregated account, are not deemed fundamental and may be
changed by the Board of Trustees without the vote of the Fund's shareholders.
SHORT SALES AGAINST THE BOX. Each Fund may make short sales "against the
box." Short sales "against the box" are transactions in which a security
identical to one owned by the Fund is borrowed and sold short. The transaction
may serve to defer a gain or loss for federal income tax purposes. There is no
limit as to the percentage of a Fund's assets that may be committed to short
sales "against the box."
FORWARD COMMITMENTS. Each Fund may purchase or sell securities on a
"forward commitment" basis, including purchases on a "when-issued" basis, a
"when, as and if issued basis" and a "to-be-announced" basis. When such
transactions are negotiated, the price, which is generally expressed in yield
terms, is fixed at the time the commitment is made, but delivery and payment
for the securities take place at a later date. Normally, the settlement date
occurs within two months after the transaction, but delayed settlements beyond
two months may be negotiated. During the period between a commitment and
settlement, no payment is made by the purchaser for the securities purchased
and, thus, no interest accrues to the purchaser from the transaction. In a
"when, as and if issued" transaction, the issuance of the security depends upon
the occurrence of a subsequent event, such as approval of a merger, corporate
reorganization or debt restructuring. In a "to-be-announced" transaction, a
Fund has committed to purchase or sell securities for which all specific
information is not yet known at the time of the trade, particularly the face
amount in Government National Mortgage Association securities transactions.
The use of forward commitments enables a Fund to hedge against
anticipated changes in interest rates and prices. Forward commitment
securities may be sold prior to the settlement date, but a Fund will enter into
forward commitment transactions only with the intention of actually receiving
or delivering the securities, as the case may be. Any significant commitment
of a
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Fund's assets to the purchase of securities on a forward commitment basis may
increase the possibility that its net asset value will fluctuate. In addition,
if a Fund chooses to dispose of the right to receive or deliver a forward
commitment security prior to the settlement date, it may incur a gain or loss.
Purchases of forward commitment securities also involve a risk of loss if the
value of the securities declines prior to the settlement date or if the seller
fails to deliver after the value of the securities has risen.
Each Fund will direct its Custodian to place cash or U.S. government
obligations in a separate account in an amount equal to the commitments of the
Fund to purchase securities as a result of its forward commitment obligations.
With respect to forward commitments to sell securities, the Fund will direct
its Custodian to place the securities in a separate account. The Fund will
direct its Custodian to segregate such assets for "when, as and if issued"
commitments only when it determines that issuance of the security is probable.
When a separate account is maintained in connection with forward commitment
transactions to purchase securities, the assets deposited in the separate
account will be valued daily at market for the purpose of determining the
adequacy of the assets in the account.
ILLIQUID SECURITIES. The portfolio of each Fund may contain illiquid
securities. A Fund will not invest more than 10% of its net assets in
securities for which there are legal or contractual restrictions on resale or
other illiquid securities. Illiquid securities generally include securities
which cannot be disposed of promptly and in the ordinary course of business
without taking a reduced price. Securities may be illiquid due to contractual
or legal restrictions on resale or lack of a ready market. The following
securities are considered to be illiquid: repurchase agreements and time
deposits maturing in more than seven days, options traded in the
over-the-counter market, nonpublicly offered securities, stripped CMOs, CMOs
for which there is no established market, direct investments in mortgages and
restricted securities. Certain types of variable amount master demand notes,
loan participation interests and floating and variable rate obligations are
also considered to be illiquid.
OTHER INVESTMENT COMPANIES. Each Fund is permitted to invest in other
investment companies at any time, except that Bartlett Cash Reserves Fund may
invest only in investment companies which are money market funds. A Fund will
not invest more than 10% of its total assets in securities of other investment
companies or invest more than 5% of its total assets in securities of any
investment company and will not purchase more than 3% of the outstanding voting
stock of any investment company. If the Fund acquires securities of another
investment company, the shareholders of the Fund may be subject to duplicative
management fees. Investments by the Fund in CMOs and
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foreign banks that are deemed to be investment companies under the Investment
Company Act of 1940 will be included in the limitation on investments in other
investment companies (except that the 10% limitation does not apply to debt
securities and non-voting preferred stock of foreign banks).
PORTFOLIO MANAGEMENT POLICIES FOR BARTLETT CASH RESERVES FUND
The Bartlett Cash Reserves Fund seeks to maintain a stable net asset
value of $1.00 per share pursuant to Rule 2a-7 under the Investment Company Act
of 1940. In accordance with Rule 2a-7, the Fund will maintain a
dollar-weighted average portfolio of 90 days or less, purchase only instruments
having remaining maturities of 397 days or less (except for U.S. Government
obligations, which will have remaining maturities of 762 days or less) and
invest only in U.S. dollar denominated securities determined in accordance with
procedures established by the Board of Trustees to present minimal credit risks
and which are rated in one of the two highest rating categories for debt
obligations by at least two nationally recognized statistical rating
organizations (or one rating organization if the instrument was rated by only
one such organization) or, if unrated, are of comparable quality as determined
in accordance with procedures established by the Board of Trustees.
In addition, the Fund will not invest more than 5% of its total assets
in: (1) securities of any one issuer (other than cash or U.S. Government
obligations), except that the Fund may invest more than 5% of its total assets
in securities of an issuer in the highest rating category for up to three
business days or (2) securities rated in the second highest rating category.
Investments in securities of any one issuer in the second highest rating
category are further limited to the greater of 1% of total assets or
$1,000,000. As to each security, these percentages are measured at the time
the Fund purchases the security. Securities of an issuer include securities
collateralizing a repurchase agreement and puts issued by the issuer (except
for unconditional puts if no more than 10% of the Fund's total assets is
invested in securities issued or guaranteed by the issuer of the unconditional
put).
INVESTMENT LIMITATIONS
Each Fund has adopted several investment limitations to reduce the risk
of an investment in the Fund. Some of these limitations are summarized below.
The limitations as well as other investment limitations applicable to each Fund
are set forth in their entirety under "Investment Limitations" in the
applicable Statement of Additional Information.
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BORROWING MONEY. The Fund will not borrow money, except (a) from a bank,
provided that immediately after such borrowing there is an asset coverage of
300% for all borrowings of the Fund; or (b) from a bank or other persons for
temporary purposes only, provided that such temporary borrowings are in an
amount not exceeding 5% of the Fund's total assets at the time when the
borrowing is made. This limitation does not preclude a Fund (other than the
Bartlett Value International Fund) from entering into reverse repurchase
transactions (including dollar rolls), provided that the Fund has an asset
coverage of 300% for all borrowings and repurchase commitments of the Fund
pursuant to reverse repurchase transactions.
PLEDGING. The Fund will not mortgage, pledge, hypothecate or in any
manner transfer, as security for indebtedness, any assets of the Fund except as
may be necessary in connection with borrowings described in limitation (1)
above. (Margin deposits, security interests, liens and collateral arrangements
with respect to transactions involving options, futures contracts, short sales
and other permitted investments and techniques are not deemed to be a mortgage,
pledge or hypothecation of assets for purposes of this limitation.)
Borrowing and reverse repurchase agreements (including dollar rolls)
magnify the potential for gain or loss on the portfolio securities of a Fund
and, therefore, increase the possibility of fluctuation in the Fund's net asset
value. This is the speculative factor known as leverage. To reduce the risks
of borrowing and reverse repurchase agreements, each Fund has adopted the
limitations described above.
GENERAL INFORMATION
FUNDAMENTAL POLICIES. The investment limitations set forth in the
Statements of Additional Information may not be changed without the affirmative
vote of the majority of the outstanding shares of the applicable Fund.
INVESTMENT OBJECTIVES. The investment objective of each Fund may be
changed without the affirmative vote of a majority of the outstanding shares of
the Fund. However, shareholders of any Fund will be given a minimum of 30
days' prior written notice before any change in investment objective becomes
effective.
SHORT TERM TRADING. None of the Funds intends to purchase or sell
securities for short term trading purposes.
PORTFOLIO TURNOVER. Although none of the Funds will purchase or sell
securities for short term trading purposes, each Fund will, however, sell any
portfolio security (without regard to the length of time it has been held) when
the Advisor believes
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that market conditions, creditworthiness factors or general economic conditions
warrant such action. The sale of existing portfolio securities and the
repurchase of replacement securities is known as the "portfolio turnover." Due
to the shorter average portfolio maturities of the Bartlett Cash Reserves Fund
and the Bartlett Short Term Bond Fund, these Funds may be expected to have a
higher-than-average portfolio turnover rate. Although it has somewhat longer
maturities, the Bartlett Fixed Income Fund has a higher-than-average portfolio
turnover because those longer maturities subject that Fund to greater market
volatility, and, therefore, more trading in response to changing market
conditions.
A 100% turnover rate would occur if all of the portfolio securities were
replaced once in a one year period. Higher portfolio turnover rates will
result in greater aggregate brokerage commissions or dealer spreads, and may
result in the realization of greater net short-term capital gains or net
long-term capital gains for tax purposes. See "Taxes."
SHAREHOLDER RIGHTS. Any Trustee of either Trust may be removed by vote
of the shareholders holding not less than two-thirds of the outstanding shares
of the Trust. Neither Trust holds annual meetings of shareholders. When
matters are submitted to shareholders for a vote, each shareholder is entitled
to one vote for each whole share he owns and fractional votes for fractional
shares he owns. All shares of a Fund have equal voting rights and liquidation
rights.
JOINT PROSPECTUS. This prospectus contains information on five different
Funds. Each of the Funds is responsible and may be held liable for errors in
or omissions from this Prospectus, and the registration statement of which it
is a part, concerning any of the Funds.
INVESTMENT PERFORMANCE
AVERAGE ANNUAL TOTAL RETURN. Each Fund may periodically advertise
"average annual total return." The "total return" of a Fund refers to the
dividends and capital gain distributions generated by an investment in the Fund
plus the change in the value of the investment from the beginning of the period
to the end of the period. The "average annual total return" of a Fund refers
to the rate of total return for each year of the period which would be
equivalent to the cumulative total return for the period. All dividends and
capital gain distributions earned on the investment are assumed to be
reinvested.
OTHER PERFORMANCE INFORMATION. Each Fund may also periodically advertise
its TOTAL RETURN and CUMULATIVE TOTAL RETURN over various periods in addition
to the value of a $10,000 investment (made on the date of the initial public
offering of
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<PAGE> 54
the Fund's shares) as of the end of a specified period. The "total return" and
"cumulative total return" for each Fund are calculated as indicated above for
"total return."
YIELD. The Bartlett Cash Reserves Fund may periodically advertise its
"yield" and "effective yield." The "yield" of the Fund refers to the income
generated by an investment in the Fund over a seven-day period (which period
will be stated in the advertisement). This income is then "annualized." That
is, the amount of income generated by the investment during that week is
assumed to be generated each week over a 52-week period and is shown as a
percentage of the investment. The "effective yield" is calculated similarly
but, when annualized, the income earned by an investment in the Fund is assumed
to be reinvested. The "effective yield" will be slightly higher than the
"yield" because of the compounding effect of this assumed reinvestment.
The Bartlett Fixed Income Fund and the Bartlett Short Term Bond Fund may
also periodically advertise their yields for a thirty-day or one month period.
The "yield" of these Funds refers to the income generated by an investment in
that Fund over the period, calculated on a per share basis (using the net asset
value per share on the last day of the period and the average number of shares
outstanding during the period). Each Fund's yield quotation will always be
accompanied by that Fund's average annual total return information described
above.
The advertised performance data of each Fund is based on historical
performance and is not intended to indicate future performance. Yields and
rates of total return quoted by a Fund may be higher or lower than past
quotations, and there can be no assurance that any yield rate of total return
will be maintained. The principal value of an investment in the Bartlett Value
International Fund, the Bartlett Basic Value Fund, the Bartlett Fixed Income
Fund and the Bartlett Short Term Bond Fund will fluctuate so that a
shareholder's shares, when redeemed, may be worth more or less than the
shareholder's original investment.
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<PAGE> 55
INVESTMENT ADVISOR
Bartlett & Co.
36 East Fourth Street
Cincinnati, Ohio 45202-3896
CUSTODIANS
Provident Bank
One East Fourth Street
Cincinnati, Ohio 45202
Mitsubishi Global Custody
(a division of the Bank of California)
475 Sansome Street
San Francisco, California 94111
TRANSFER AGENT
Bartlett & Co.
36 East Fourth Street
Cincinnati, Ohio 45202
AUDITORS
Arthur Andersen LLP
425 Walnut Street
Cincinnati, Ohio 45202
- --------------------------------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, IN CONNECTION
WITH THE OFFERING CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS BEING AUTHORIZED BY
EITHER TRUST. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER BY EITHER TRUST TO
SELL ITS SHARES IN ANY STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER IN SUCH STATE.
- --------------------------------------------------------------------------------
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<PAGE> 56
BARTLETT MANAGEMENT TRUST
Statement of Additional Information
August 1, 1995
Bartlett Cash Reserves Fund
This Statement of Additional Information is not a prospectus. It
should be read in conjunction with the Prospectus of Bartlett Management Trust
and Bartlett Capital Trust dated August 1, 1995. A copy of the Prospectus can
be obtained by writing the Trust at 36 East Fourth Street, Cincinnati, Ohio
45202, or by calling the Trust nationwide toll free 800-800-3609 or in
Cincinnati at 513-345-6212.
<PAGE> 57
STATEMENT OF ADDITIONAL INFORMATION
BARTLETT MANAGEMENT TRUST
36 East Fourth Street
Cincinnati, Ohio 45202
TABLE OF CONTENTS
PAGE
----
DESCRIPTION OF THE TRUST . . . . . . . . . . . . . . . . . 3
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS . . . . . . 4
INVESTMENT LIMITATIONS . . . . . . . . . . . . . . . . . . 7
STATE RESTRICTIONS . . . . . . . . . . . . . . . . . . . . 10
THE INVESTMENT ADVISOR . . . . . . . . . . . . . . . . . . 11
MANAGEMENT OF THE TRUST . . . . . . . . . . . . . . . . . 13
PORTFOLIO TRANSACTIONS AND BROKERAGE . . . . . . . . . . . 13
CALCULATION OF SHARE PRICE . . . . . . . . . . . . . . . . 16
INVESTMENT PERFORMANCE . . . . . . . . . . . . . . . . . . 16
CUSTODIANS . . . . . . . . . . . . . . . . . . . . . . . . 18
ACCOUNTANTS . . . . . . . . . . . . . . . . . . . . . . . 19
TRANSFER AGENT . . . . . . . . . . . . . . . . . . . . . . 19
FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . 20
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<PAGE> 58
DESCRIPTION OF THE TRUST
The Trust is a diversified, open-end management investment company
established under the laws of Ohio by an Agreement and Declaration of Trust
dated July 16, 1984 (the "Trust Agreement"). The Trust Agreement permits the
Trustees to issue an unlimited number of shares of beneficial interest of
separate series without par value. Shares of one series have been authorized,
which shares constitute the interests in the Bartlett Cash Reserves Fund (the
"Fund"), formerly Bartlett Enhanced Cash Reserves.
Each share of a series represents an equal proportionate interest in
the assets and liabilities belonging to that series with each other share of
that series and is entitled to such dividends and distributions out of income
belonging to the series as are declared by the Trustees. The shares do not
have cumulative voting rights or any preemptive or conversion rights, and the
Trustees have the authority from time to time to divide or combine the shares
of any series into a greater or lesser number of shares of that series so long
as the proportionate beneficial interest in the assets belonging to that series
and the rights of shares of any other series are in no way affected. In case
of any liquidation of a series, the holders of shares of the series being
liquidated will be entitled to receive as a class a distribution out of the
assets, net of the liabilities, belonging to that series. Expenses
attributable to any series are borne by that series. Any general expenses of
the Trust not readily identifiable as belonging to a particular series are
allocated by or under the direction of the Trustees in such manner as the
Trustees determine to be fair and equitable. No shareholder is liable to
further calls or to assessment by the Trust without his express consent.
If at least ten shareholders (the "Petitioning Shareholders") wish to
obtain signatures to request a meeting for the purpose of voting upon removal
of any Trustee of the Trust, they may make a written application to the Trust
requesting to communicate with other shareholders. The Petitioning
Shareholders must hold in the aggregate at least 1% of the shares then
outstanding or shares then having a net asset value of $25,000, whichever is
less, and each Petitioning Shareholder must have been a shareholder for at
least six months prior to the date of the application. The application must be
accompanied by the form of communication which the shareholders wish to
transmit. Within five business days after receipt of the application, the
Trust will (a) provide the Petitioning Shareholders with access to a list of
the names and addresses of all shareholders of the Trust; or (b) inform the
Petitioning Shareholders of the approximate number of shareholders and the
estimated costs of mailing such communication, and undertake such mailing
promptly after tender
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<PAGE> 59
by the Petitioning Shareholders to the Trust of the material to be mailed and
the reasonable expenses of such mailing.
As of May 15, 1995, the Trustees and officers as a group owned
beneficially approximately .92% of the outstanding shares of Bartlett Cash
Reserves Fund.
As of May 15, 1995, Aurora Casket Co., Inc. Restated Pension Trust
also owned 7.16% of the outstanding shares of the Bartlett Cash Reserves Fund.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS
This section contains more detailed discussion of some of the
investments a Fund may make and some of the techniques it may use, as described
in the Prospectus (see "Investment Objective and Strategy" and "Investment
Policies and Techniques").
A. Municipal Obligations. Municipal obligations are issued to
obtain funds to construct, repair or improve various public facilities such as
airports, bridges, highways, hospitals, housing, schools, streets and water and
sewer works, to pay general operating expenses or to refinance outstanding
debts. They also may be issued to finance various private activities,
including the lending of funds to public or private institutions for
construction of housing, educational or medical facilities or the financing of
privately owned or operated facilities. Municipal obligations consist of tax
exempt bonds, tax exempt notes and tax exempt commercial paper. Tax exempt
notes generally are used to provide short term capital needs and generally have
maturities of one year or less. Tax exempt commercial paper typically
represents short term, unsecured, negotiable promissory notes.
The two principal classifications of Municipal obligations are
"general obligations" and "revenue" bonds. General obligation bonds are backed
by the issuer's full credit and taxing power. Revenue bonds are backed by the
revenues of a specific project, facility or tax. Industrial development
revenue bonds are a specific type of revenue bond backed by the credit of the
private issuer of the facility, and therefore investments in these bonds have
more potential risk that the issuer will not be able to meet scheduled payments
of principal and interest.
B. Zero Coupon and Pay-in Kind Bonds. Corporate debt securities
and municipal obligations include so-called "zero coupon" bonds and
"pay-in-kind" bonds. Zero coupon bonds are issued at a significant discount
from their principal amount in lieu of paying interest periodically.
Pay-in-kind bonds allow the issuer, at its option, to make current interest
payments on the bonds either in cash or in additional bonds. The value of
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<PAGE> 60
zero coupon bonds and pay-in-kind bonds is subject to greater fluctuation in
response to changes in market interest rates than bonds which make regular
payment of interest. Both of these types of bonds allow an issuer to avoid the
need to generate cash to meet current interest payments. Accordingly, such
bonds may involve greater credit risks than bonds which make regular payments
of interest. Even though zero coupon bonds and pay-in-kind bonds do not pay
current interest in cash, the Fund is required to accrue interest income on
such investments and to distribute such amounts at least annually to
shareholders. Thus, the Fund could be required at times to liquidate other
investments in order to satisfy its dividend requirements.
C. Mortgage-Related Securities. Government-related organizations
which issue mortgage-related securities include the Government National
Mortgage Association ("GNMA"), Federal National Mortgage Association ("FNMA")
and Federal Home Loan Mortgage Corporation ("FHLMC"). Securities issued by
GNMA and FNMA are fully modified pass through securities, i.e., the timely
payment of principal and interest is guaranteed by the issuer. FHLMC
securities are modified pass through securities, i.e., the timely payment of
interest is guaranteed by FHLMC, principal is passed through as collected but
payment thereof is guaranteed not later than one year after it becomes payable.
D. Financial Services Industry Obligations. Financial services
industry obligations include among others, the following:
(1) Certificates of Deposit. Certificates of deposit are
negotiable certificates evidencing the indebtedness of a commercial bank or a
savings and loan association to repay funds deposited with it for a definite
period of time (usually from fourteen days to one year) at a stated or variable
interest rate.
(2) Time Deposits. Time deposits are non-negotiable
deposits maintained in a banking institution or a savings and loan association
for a specified period of time at a stated interest rate.
(3) Bankers' Acceptances. Bankers' acceptances are
credit instruments evidencing the obligation of a bank to pay a draft which has
been drawn on it by a customer, which instruments reflect the obligation both
of the bank and of the drawer to pay the face amount of the instrument upon
maturity.
E. Forward Commitments and Reverse Repurchase Agreements. The
Fund will direct its Custodian to place cash or U.S. government obligations in
a separate account of the Trust in an amount equal to the commitments of the
Fund to purchase or repurchase securities as a result of its forward commitment
or reverse repurchase agreement obligations. With respect to
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<PAGE> 61
forward commitments to sell securities, the Trust will direct its Custodian to
place the securities in a separate account. The Fund will direct its Custodian
to segregate such assets for "when, as and if issued" commitments only when it
determines that issuance of the security is probable. When a separate account
is maintained in connection with forward commitment transactions to purchase
securities or reverse repurchase agreements, the assets deposited in the
separate account will be valued daily at market for the purpose of determining
the adequacy of the assets in the account. If the market value of such assets
declines, additional assets will be placed in the account on a daily basis so
that the market value of the account will equal the amount of the Fund's
commitments to purchase or repurchase securities. To the extent assets are in
a separate account, they will not be available for new investment or to meet
redemptions.
Commitments to purchase securities on a "when, as and if issued" basis
will not be recognized in the portfolio of the Fund until the Advisor
determines that issuance of the security is probable. At such time, the Fund
will record the transaction and, in determining its net asset value, will
reflect the value of the security daily.
Securities purchased on a forward commitment basis, securities subject
to reverse repurchase agreements and the securities held in the Fund's
portfolio are subject to changes in market value based upon the public's
perception of the creditworthiness of the issuer and changes in the level of
interest rates (which will generally result in all of those securities changing
in value in the same way, i.e., all those securities experiencing appreciation
when interest rates decline and depreciation when interest rates rise).
Therefore, if in order to achieve a higher level of income, the Fund remains
substantially fully invested at the same time that it has purchased securities
on a forward commitment basis or entered into reverse repurchase transactions,
there will be a possibility that the market value of the Fund's assets will
have greater fluctuation.
With respect to 75% of the total assets of the Fund, the value of the
Fund's commitments to purchase or repurchase the securities of any one issuer,
together with the value of all securities of such issuer owned by the Fund, may
not exceed 5% of the value of the Fund's total assets at the time the
commitment to purchase or repurchase such securities is made; provided,
however, that this restriction does not apply to U.S. government obligations or
repurchase agreements with respect thereto. In addition, the Fund will
maintain an asset coverage of 300% for all of its borrowings and reverse
repurchase agreements. Subject to the foregoing restrictions, there is no
limit on the percentage of the Fund's total assets which may be committed to
such purchases or repurchases.
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<PAGE> 62
F. Short Sales. When the Fund borrows a security in connection
with a short sale, the Fund is required to pay to the lender any dividends or
interest which accrue during the period of the loan. To borrow the security,
the Fund also may be required to pay a premium to the lender, which would
increase the cost of the security sold. The amount of any gain will be
decreased, and the amount of any loss increased, by the amount of any premium,
dividends or interest the Fund may be required to pay in connection with the
short sale. The proceeds of the short sale will be retained by the lender or
its broker, to the extent necessary to meet margin requirements, until the
short position is closed out by delivery of the underlying security.
G. Restricted Securities. Restricted securities are securities
the resale of which is subject to legal or contractual restrictions.
Restricted securities may be sold only in privately negotiated transactions, in
a public offering with respect to which a registration statement is in effect
under the Securities Act of 1933 or pursuant to Rule 144 or Rule 144A
promulgated under such Act. Where registration is required, the Fund may be
obligated to pay all or part of the registration expense, and a considerable
period may elapse between the time of the decision to sell and the time such
security may be sold under an effective registration statement. If during such
a period adverse market conditions were to develop, the Fund might obtain a
less favorable price than the price it could have obtained when it decided to
sell.
H. Money Market Funds. The Bartlett Cash Reserves Fund may
invest in shares of any money market fund that has substantially identical
investment objectives and policies as the Bartlett Cash Reserves Fund.
INVESTMENT LIMITATIONS
The investment limitations described below have been adopted by the
Trust with respect to the Fund and may not be changed without the affirmative
vote of a majority of the outstanding shares of the Fund. As used in the
Prospectus and this Statement of Additional Information, the term "majority" of
the outstanding shares of the Fund means the lesser of (1) 67% or more of the
outstanding shares of the Fund present at a meeting, if the holders of more
than 50% of the outstanding shares of the Fund are present or represented at
such meeting; or (2) more than 50% of the outstanding shares of the Fund.
1. Borrowing Money. The Fund will not borrow money, except (a)
from a bank, provided that immediately after such borrowing there is an asset
coverage of 300% for all borrowings of the Fund; or (b) from a bank or other
persons for temporary purposes only, provided that such temporary borrowings
are in an
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<PAGE> 63
amount not exceeding 5% of the Fund's total assets at the time when the
borrowing is made. This limitation does not preclude the Fund from entering
into reverse repurchase transactions, provided that the Fund has an asset
coverage of 300% for all borrowings and repurchase commitments of the Fund
pursuant to reverse repurchase transactions.
2. Pledging. The Fund will not mortgage, pledge, hypothecate or
in any manner transfer, as security for indebtedness, any assets of the Fund
except as may be necessary in connection with borrowings described in
limitation (1) above. (Margin deposits, security interests, liens and
collateral arrangements with respect to transactions involving options, futures
contracts, short sales and other permitted investments and techniques are not
deemed to be a mortgage, pledge or hypothecation of assets for purposes of this
limitation.)
3. Underwriting. The Fund will not act as underwriter of
securities issued by other persons. This limitation is not applicable to the
extent that, in connection with the disposition of portfolio securities
(including restricted securities), the Fund may be deemed an underwriter under
certain federal securities laws.
4. Illiquid Investments. The Fund will not invest more than 10%
of its net assets in securities for which there are legal or contractual
restrictions on resale and other illiquid securities.
5. Real Estate. The Fund will not purchase, hold or deal in real
estate. This limitation is not applicable to investments in securities which
are secured by or represent interests in real estate. This limitation does not
preclude the Fund from investing in mortgage-related securities or investing
directly in mortgages.
6. Commodities. The Fund will not purchase, hold or deal in
commodities or commodities futures contracts except as described in the
Prospectus and Statement of Additional Information.
7. Loans. The Fund will not make loans to other persons, except
(a) by loaning portfolio securities, (b) by engaging in repurchase agreements,
(c) by purchasing nonpublicly offered debt securities, or (d) through direct
investments in mortgages. For purposes of this limitation, the term "loans"
shall not include the purchase of a portion of an issue of publicly distributed
bonds, debentures or other securities.
8. Margin Purchases. The Fund will not purchase securities or
evidences of interest thereon on "margin." This limitation is not applicable
to short term credit obtained by the
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<PAGE> 64
Fund for the clearance of purchases and sales or redemption of securities, or
to arrangements with respect to transactions involving options, futures
contracts, short sales and other permitted investments and techniques.
9. Short Sales. The Fund will not effect short sales of
securities except as described in the Prospectus and Statement of Additional
Information.
10. Options. The Fund will not purchase or sell puts, calls,
options or straddles except as described in the Prospectus and Statement of
Additional Information.
11. Other Investment Companies. The Fund will not invest more
than 10% of its total assets in securities of other investment companies or
invest more than 5% of its total assets in securities of any investment company
and will not purchase more than 3% of the outstanding voting stock of any
investment company.
12. Concentration. The Fund will not invest more than 25% of its
total assets in a particular industry except that under normal market
conditions the Fund will invest more than 25% of its total assets in the
financial services industry. This limitation is not applicable to investments
in obligations issued or guaranteed by the U.S. government, its agencies and
instrumentalities or repurchase agreements with respect thereto.
13. Oil and Gas Programs. The Fund will not purchase, hold or
deal in oil, gas or other mineral explorative or development programs.
14. Diversification. As a diversified series of the Trust, the
Fund will not purchase the securities of any issuer if such purchase at the
time thereof would cause less than 75% of the value of the total assets of the
Fund to be invested in cash and cash items (including receivables), securities
issued by the U.S. government, its agencies or instrumentalities and repurchase
agreements with respect thereto, securities of other investment companies,
other securities for the purposes of this calculation limited in respect of any
one issuer to an amount not greater in value than 5% of the value of the total
assets of the Fund and to not more than 10% of the outstanding voting
securities of such issuer.
With respect to the percentages adopted by the Trust as maximum
limitations on its investment policies and limitations, an excess above the
fixed percentage will not be a violation of the policy or limitation unless the
excess results immediately and directly from the acquisition of any security or
the action taken.
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<PAGE> 65
Notwithstanding any of the foregoing limitations, any investment
company, whether organized as a trust, association or corporation, or a
personal holding company, may be merged or consolidated with or acquired by the
Trust, provided that if such merger, consolidation or acquisition results in an
investment in the securities of any issuer prohibited by said paragraphs, the
Trust shall, within ninety days after the consummation of such merger,
consolidation or acquisition, dispose of all of the securities of such issuer
so acquired or such portion thereof as shall bring the total investment therein
within the limitations imposed by said paragraphs above as of the date of
consummation.
For purposes of the diversification requirements described above, the
Fund will treat both the corporate borrower and the financial intermediary as
issuers of a loan participation interest. Investments by a Fund in CMOs that
are deemed to be investment companies under the Investment Company Act of 1940
will be included in the limitation on investments in other investment
companies.
The Advisor is aware of the provisions of the Public Utility Holding
Company Act of 1935 (the "1935 Act"). While it is not a fundamental policy,
the Fund presently intends to limit its investments so that it will not be a
public utility holding company or acquire public utility company securities in
violation of the 1935 Act.
STATE RESTRICTIONS
To comply with current blue sky regulations, the Fund presently
intends to observe the following restrictions, which may be changed by the
Board of Trustees without shareholder approval.
Ohio Restrictions
The Fund will not purchase or retain securities of any issuer if the
Trustees and officers of the Trust or of the Advisor, who individually own
beneficially more than 0.5% of the outstanding securities of such issuer,
together own beneficially more than 5% of such securities. The Fund will not
purchase securities issued by other investment companies except by purchase in
the open market where no commission or profit to a sponsor or dealer results
from such purchase other than customary broker's commission or except when such
purchase is part of a plan of merger, consolidation, reorganization or
acquisition. The Fund will not borrow (other than by entering into reverse
repurchase agreements), pledge, mortgage or hypothecate more than one-third of
its total assets. In addition, the Fund will engage in borrowing (other than
reverse repurchase agreements) only for emergency or extraordinary purposes and
not for
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<PAGE> 66
leverage. The Fund will not invest more than 15% of its total assets in
securities of issuers which, together with any predecessors, have a record of
less than three years continuous operation or securities of issuers which are
restricted as to disposition.
California Restrictions
As long as the rules promulgated under the California Corporate
Securities Law prohibit the Fund from acquiring or retaining securities of any
open-end investment company, the Fund will not acquire or retain such
securities, unless the acquisition is part of a merger or acquisition of assets
or other reorganization. In addition, as long as such rules include
restrictions on options transactions by an investment company, the Fund will
adhere to such restrictions as interpreted by the staff of the California
Department of Corporations.
THE INVESTMENT ADVISOR
The Trust's investment advisor is Bartlett & Co., 36 East Fourth
Street, Cincinnati, Ohio 45202. Bartlett & Co. is a corporation formed to
succeed to the business of the partnership also known as Bartlett & Co.
Bartlett & Co. is the oldest independent registered investment advisory firm in
the United States, having provided investment advice to individuals,
corporations, pension and profit sharing plans and trust accounts since 1898.
It is a broker-dealer registered under the Securities Exchange Act of 1934 and
a member of the National Association of Securities Dealers, Inc. and various
stock exchanges. The directors and officers of Bartlett & Co. are Michael S.
Cambron, Susan J. Hickenlooper, James F. Lummanick, Melvin B. Mellis, James A.
Miller, Gerald L. Oaks, Donna M. Prieshoff, Dale H. Rabiner, James B. Reynolds,
William C. Stock and Woodrow H. Uible.
Under the terms of the management agreement (the "Agreement"), the
Advisor manages the Trust's investments subject to approval of the Board of
Trustees and pays all of the expenses of the Trust except brokerage, taxes,
interest and extraordinary expenses. As compensation for its advisory services
and agreement to pay the Trust's expenses, the Advisor receives a fee computed
and accrued daily and paid monthly at an annual rate of .78% of the average
daily net assets of the Fund up to and including $500,000,000 and .75% of such
assets in excess of $500,000,000. Most investment companies make smaller
payments to their investment advisors because such companies directly pay their
own operating expenses, while all of the Trust's expenses except those
specified above are paid by the Advisor.
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<PAGE> 67
The Advisor has agreed to reimburse the Trust to the extent that the
expenses of the Trust for the same fiscal year exceed the expense limitations
applicable to the Trust imposed by state securities administrators, as such
limitations may be lowered or raised from time to time. The most restrictive
applicable limitation is presently 2.5% of the first $30 million of average net
assets, 2% of the next $70 million and 1.5% of average net assets in excess of
$70 million. If any such reimbursement is required, the payment of the
advisory fee at the end of any month will be reduced or postponed or, if
necessary, a refund will be made to the Trust. Certain expenses such as
brokerage commissions, if any, taxes, interest, extraordinary items and other
expenses subject to approval of state securities administrators are excluded
from such limitations. If the expenses of the Trust or the Fund approach the
applicable limitation in any state, the Trust will consider the various actions
that are available to it, including suspension of sales to residents of that
state.
For the fiscal years ended March 31, 1993, 1994 and 1995, the Advisor
received management fees from the Fund of $591,032, $541,065 and $614,397,
respectively. To reduce the operational expenses of the Fund, the Advisor
voluntarily reduced its fee for these periods by $117,640, $79,150 and $0,
respectively, which otherwise would have been payable by the Fund.
The Advisor retains the right to use the name "Bartlett" in connection
with another investment company or business enterprise with which the Advisor
is or may become associated. The Trust's right to use the name "Bartlett"
automatically ceases thirty days after termination of the Agreement and may be
withdrawn by the Advisor on thirty days written notice.
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<PAGE> 68
MANAGEMENT OF THE TRUST
For the fiscal year ended March 31, 1995, the Trustees of the Trust
received the following compensation:
<TABLE>
<CAPTION>
Name of Person, Aggregate Compensation Pension or Retirement Estimated Annual Total Compensation From
Position From Fund Benefits Accrued as Benefits Upon Registrant and Fund
Part of Fund Expenses Retirement Complex Paid to
Trustees
<S> <C> <C> <C> <C>
Dale H. Rabiner* $0 $0 $0 $0
James B. Reynolds* $0 $0 $0 $0
Lorrence T. Kellar $1600 $0 $0 $8000
Philip J. Ringo $800 $0 $0 $4000
Alan R. Schriber $1000 $0 $0 $5000
William P. Sheehan $1200 $0 $0 $6000
George J. Wile $1200 $0 $0 $8000
</TABLE>
*Interested Person
The Trust and Bartlett Capital Trust are the two investment companies
in the Bartlett Mutual Funds complex. They have identical Boards of Trustees,
and board and committee meetings of both Trusts are held at the same time.
Although the fees paid to Trustees are expenses of the Trusts, the Advisor
makes the actual payment pursuant to its management agreements with the Trusts,
which obligate the Advisor to pay all of the operating expenses of the Trusts
(with limited exceptions). Messrs. Rabiner and Reynolds, who are employees of
the Advisor, receive no remuneration for their services as Trustees and
officers of the Trust. Similarly, the other officers of the Trust, all of whom
are employees of the Advisor, receive no remuneration for their services.
PORTFOLIO TRANSACTIONS AND BROKERAGE
Subject to policies established by the Board of Trustees of the Trust,
the Advisor is responsible for the Trust's portfolio decisions and the placing
of the Trust's portfolio transactions. In placing portfolio transactions, the
Advisor seeks the best qualitative execution for the Trust, taking into account
such factors as price (including the applicable brokerage commission or dealer
spread), the execution capability, financial responsibility and responsiveness
of the broker or dealer and the brokerage and research services provided by the
broker or dealer. The Advisor generally seeks favorable prices and commission
rates that are reasonable in relation to the benefits received. The Trust has
no obligation to deal with any broker or dealer in the execution of its
transactions.
- 13 -
<PAGE> 69
The Advisor is specifically authorized to select brokers or dealers
who also provide brokerage and research services to the Trust and/or the other
accounts over which the Advisor exercises investment discretion and to pay such
brokers or dealers a commission in excess of the commission another broker or
dealer would charge if the Advisor determines in good faith that the commission
is reasonable in relation to the value of the brokerage and research services
provided. The determination may be viewed in terms of a particular transaction
or the Advisor's overall responsibilities with respect to the Trust and to
other accounts over which it exercises investment discretion.
Research services include supplemental research, securities and
economic analyses, statistical services and information with respect to the
availability of securities or purchasers or sellers of securities and analyses
of reports concerning performance of accounts. The research services and other
information furnished by brokers through whom the Trust effects securities
transactions may also be used by the Advisor in servicing all of its accounts
and all such services may not be used by the Advisor in connection with the
Trust. Similarly, research and information provided by brokers or dealers
serving other clients may be useful to the Advisor in connection with its
services to the Trust. Although research services and other information are
useful to the Trust and the Advisor, it is not possible to place a dollar value
on the research and other information received. It is the opinion of the Board
of Trustees and the Advisor that the review and study of the research and other
information will not reduce the overall cost to the Advisor of performing its
duties to the Trust under the Agreement.
The Agreement provides that the Advisor, in its capacity as a
registered broker-dealer, may receive brokerage commissions in connection with
effecting portfolio transactions for the Trust. The Trust will not effect any
brokerage transactions in its portfolio securities with the Advisor if such
transactions would be unfair or unreasonable to Trust shareholders, and the
commissions will be paid solely for the execution of trades and not for any
other services.
Over-the-counter transactions may be placed either directly with
principal market makers, or with broker-dealers if the same or a better price,
including commissions and execution, is available. Fixed income securities are
normally purchased directly from the issuer, an underwriter or a market maker.
Purchases include a concession paid by the issuer to the underwriter and the
purchase price paid to market makers may include the spread between the bid and
asked prices. While the Trust contemplates no ongoing arrangements with any
other brokerage firms, brokerage business may be given from time to time to
other firms. The Advisor will not receive reciprocal
- 14 -
<PAGE> 70
brokerage business as a result of the brokerage business placed by the Trust
with others.
Under the Investment Company Act of 1940, persons affiliated with the
Trust are prohibited from dealing with the Trust as a principal in the purchase
and sale of securities. Since transactions in the over-the-counter market
usually involve transactions with dealers acting as principal for their own
account, affiliated persons of the Trust, including the Advisor, will not serve
as the Fund's dealer in connection with such transactions. However, affiliated
persons of the Trust may serve as its broker in over-the-counter transactions
conducted on an agency basis.
The Board of Trustees believes that it is more efficient to place the
Trust's portfolio transactions with the Advisor than other brokers and dealers
because it will be less time consuming, reduce the possibility of error and
ensure confidentiality with respect to the Trust's portfolio positions. In
determining the commissions to be paid to the Advisor, it is the policy of the
Trust that such commissions will, in the judgment of the Board of Trustees, be
(a) at least as favorable to the Fund as those which would be charged by other
qualified brokers having comparable execution capability and (b) at least as
favorable to the Trust as commissions contemporaneously charged by the Advisor
on comparable transactions for its most favored unaffiliated customers, except
for customers of the Advisor considered by a majority of the Trust's
disinterested Trustees not to be comparable to the Trust. A committee of
disinterested Trustees from time to time reviews, among other things,
information relating to the commissions charged by the Advisor to the Trust and
its other customers, and posted rates and other information concerning the
commissions charged by other qualified brokers.
To the extent that the Trust and another of the Advisor's clients seek
to acquire the same security at about the same time, the Trust may not be able
to acquire as large a position in such security as it desires or it may have to
pay a higher price for the security. Similarly, the Trust may not be able to
obtain as large an execution of an order to sell or as high a price for any
particular portfolio security if the other client desires to sell the same
portfolio security at the same time. On the other hand, if the same securities
are bought or sold at the same time by more than one client, the resulting
participation in volume transactions could produce better executions for the
Trust. In the event that more than one client wants to purchase or sell the
same security on a given date, the purchases and sales will normally be made by
random client selection.
R. Stuart Crickmer, Carol D. Hard, James F. Lummanick, Madelynn M.
Matlock, James A. Miller, Donna M. Prieshoff, Dale H. Rabiner, James B.
Reynolds, Kenneth L. Schlachter, Thomas A.
- 15 -
<PAGE> 71
Steele and Woodrow H. Uible, by reason of their affiliation with the Advisor,
will receive benefits from any profits from brokerage commissions earned by the
Advisor as a result of portfolio transactions for the Fund. The Agreement does
not provide for a reduction of the Advisor's fee by the amount of any profits
earned by Bartlett & Co. from brokerage commissions generated from portfolio
transactions of the Trust. For the fiscal years ended March 31, 1995, 1994 and
1993, the Fund paid brokerage commissions of $0, $0 and $0, respectively. No
brokerage commissions were paid to the Advisor.
As of March 31, 1995, the Fund owned securities of its regular
broker-dealers or their parents (as defined in Rule 10b-10 promulgated under
the Investment Company Act of 1940) as indicated: Associates Corp. of North
America - $2,968,439, Beneficial Corp. - $2,970,598, Chevron Oil Finance Corp.
- - $2,975,332, Deere & Co. Capital Corp. - $2,994,672, Ford Motor Credit Co. -
$2,988,022, General Electric Capital Corp. - $2,972,592, IBM Credit Corp. -
$2,996,278,Norwest Financial, Inc. - $2,977,194, and Sears Roebuck Acceptance
Corp. - $2,974,585.
CALCULATION OF SHARE PRICE
The price (net asset value) of the shares of the Fund is calculated
twice daily, as of 12:00 p.m. and the close of trading on the New York Stock
Exchange (generally 4:00 p.m. New York time), on any day when the New York
Stock Exchange and the Custodian are open for business. The Trust is open for
business on every day except Saturdays, Sundays and the following holidays:
New Year's Day, President's Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas, or any national holiday which results in
the closing of the New York Stock Exchange. For a description of the methods
used to determine the net asset value (share price), see "Calculation of Share
Price" in the Prospectus.
INVESTMENT PERFORMANCE
"Average annual total return," as defined by the Securities and
Exchange Commission, is computed by finding the average annual compounded rates
of return (over the one and five year periods and the period from initial
public offering through the end of the Fund's most recent fiscal year) that
would equate the initial amount invested to the ending redeemable value,
according to the following formula:
P(1+T)n=ERV
- 16 -
<PAGE> 72
Where: P = a hypothetical $1,000 initial investment
T = average annual total return
n = number of years
ERV = ending redeemable value at the end of the
applicable period of the hypothetical $1,000
investment made at the beginning of the applicable
period.
The computation assumes that all dividends and distributions are reinvested at
the net asset value on the reinvestment dates and that a complete redemption
occurs at the end of the applicable period.
Current yield is computed by determining the net change in the value
of a hypothetical pre-existing account with a balance of one share at the
beginning of a seven calendar day period (the "Base Period") and dividing the
net change by the value of the account at the beginning of the Base Period to
obtain the base period return, and then multiplying the base period return by
(365/7) with the resulting yield figure carried to at least the nearest
hundredth of one percent. Effective yield is computed by compounding the base
period return, according to the following formula: effective yield = [(base
period return + 1)365/7] - 1. The Fund's current and effective yields for the
seven day period ended March 31, 1995 were 5.24% and 5.38%, respectively.
The Fund's investment performance will vary depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. These factors and possible differences in the methods and time
periods used in calculating non-standardized investment performance should be
considered when comparing the Fund's performance to those of other investment
companies or investment vehicles. The risks associated with the Fund's
investment objective, policies and techniques should also be considered. At
any time in the future, investment performance may be higher or lower than past
performance, and there can be no assurance that any performance will continue.
From time to time, in advertisements, sales literature and information
furnished to present or prospective shareholders, the performance of the Fund
may be compared to indices of broad groups of unmanaged securities considered
to be representative of or similar to the portfolio holdings of the Fund or
considered to be representative of the fixed income securities market in
general. The Fund may use the Salomon Brothers Inc. "Bond Market Round-Up,"
which tracks yield and yield spreads on a large group of money market
securities, corporate debt securities and U.S. government obligations, Telerate
Systems, Inc., which tracks rates on similar securities or the Bank Rate
Monitor National Index, which represents an average of money market account
yields paid by the five largest banks and the five largest thrift institutions
in the ten largest national markets. The Bank Rate
- 17 -
<PAGE> 73
Monitor National Index is compiled weekly by Advertising News Service, Inc.
The investment performance figures for the Fund and the indices will include
reinvestment of dividends and capital gains distributions.
In addition, the performance of the Fund may be compared to other
groups of mutual funds tracked by any widely used independent research firm
which ranks mutual funds by overall performance, investment objectives and
assets, such as Morningstar, Inc., Lipper Analytical Services, Inc. or the
Donoghue Organization, Inc. The objectives, policies, limitations and expenses
of other mutual funds in a group may not be the same as those of the Fund.
Performance rankings and ratings reported periodically in national financial
publications such as Barron's and Fortune, also may be used.
The following table shows the rate of total return for the indicated
period as well as the value of a $10,000 investment made on February 16, 1988,
as of the end of the specified period.
<TABLE>
<CAPTION>
Period End Value of
Period Net Asset Dividends $10,000 Total Return
Ended Value Paid Investment(a) One Year Cumulative(b)
- ------ ----- --------- ------------- -------- -------------
<S> <C> <C> <C> <C> <C>
6/30/88 $1.00 $0.0248 $10,251 2.50%(b) 2.50%
6/30/89 $1.00 $0.0811 $11,114 8.42% 11.14%
3/31/90(c) $1.00 $0.0595 $11,792 8.13%(d) 17.92%
3/31/91 $1.00 $0.0708 $12,655 7.32% 26.55%
3/31/92 $1.00 $0.0495 $13,296 5.07% 32.96%
3/31/93 $1.00 $0.0321 $13,730 3.26% 37.30%
3/31/94 $1.00 $0.0266 $14,099 2.69% 40.99%
3/31/95 $1.00 $0.0415 $14,694 4.22% 46.94%
</TABLE>
(a) Value at end of fiscal year of $10,000 investment made on February 16,
1988.
(b) Not annualized and from the date of the initial public offering of
shares (February 16, 1988).
(c) For the nine month period then ended.
(d) Annualized.
CUSTODIAN
The Provident Bank, One East Fourth Street, Cincinnati, Ohio, is
Custodian of the Trust's investments. The Custodian acts as the Trust's
depository, safekeeps its portfolio securities, collects all income and other
payments with respect thereto, disburses funds at the Trust's request and
maintains records in connection with its duties. While the Trust intends to
enter into repurchase agreements with the Custodian and may
- 18 -
<PAGE> 74
purchase other securities of the Custodian, the Custodian will not receive any
preferential treatment from the Trust.
ACCOUNTANTS
The firm of Arthur Andersen LLP has been selected as independent
public accountants for the Trust for the fiscal year ending March 31, 1995.
Arthur Andersen LLP, 425 Walnut Street, Cincinnati, Ohio, performs an annual
audit of the Trust's financial statements, reviews the Trust's federal tax
return and provides financial and accounting consulting services as requested.
TRANSFER AND ACCOUNTING SERVICES AGENT
Bartlett & Co. acts as the Trust's transfer and accounting services
agent and, in such capacities, maintains the records of each shareholder's
account, answers shareholders' inquiries concerning their accounts, processes
purchases and redemptions of the Trust's shares, acts as dividend and
distribution disbursing agent and performs other accounting and shareholder
service functions.
- 19 -
<PAGE> 75
=========================
PORTFOLIOS OF INVESTMENTS
=========================
BARTLETT VALUE INTERNATIONAL FUND
As of March 31, 1995
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCK -- 92.02%
- -------------------------------------------------------------------------
<S> <C> <C>
Argentina -- 2.69%
YPF Sociedad Anonima SA (ADR)
(Energy, Oil & Gas) 81,600 $ 1,550,400
- -------------------------------------------------------------------------
Australia -- 6.95%
Brambles Industries Ltd.
(Transport Services) 132,800 1,232,899
Burns Philp & Company Ltd.
(Food, Manufacturing) 580,190 1,363,649
National Australia Bank (ADR)
(Banking) 33,600 1,411,200
----------
4,007,748
- -------------------------------------------------------------------------
Canada -- 2.59%
Hudson's Bay Co.
(Retailing) 75,000 1,493,517
- -------------------------------------------------------------------------
Chile -- 2.73%
Sociedad Quimica
Minera de Chile (ADR)
(Chemicals) 52,400 1,572,000
- -------------------------------------------------------------------------
Finland -- 1.97%
Tampella AB*
(Paper Products) 527,000 1,138,784
- -------------------------------------------------------------------------
France -- 12.45%
Alcatel Althsom
(Capital Goods) 6,700 606,540
Alcatel Althsom (ADR)
(Capital Goods) 45,600 826,500
Essilor International
(Consumer Goods) 9,300 1,606,690
St. Gobain
(Glass/Building Materials) 11,634 1,449,856
Total Co. Francaise Petrole-B
(Energy) 11,200 669,408
Total SA (ADR)
(Energy) 23,100 693,000
Valeo
(Auto Components) 24,500 1,324,945
----------
7,176,939
- -------------------------------------------------------------------------
Germany -- 2.62%
Bayer AG
(Chemicals) 6,130 1,509,817
- -------------------------------------------------------------------------
Hong Kong -- 4.57%
Dairy Farm Intl. Holdings Ltd.
(Food Retailing) 1,296,000 $ 1,659,282
Hutchison Wampoa
(Real Estate/Communications) 222,000 979,011
----------
2,638,293
- -------------------------------------------------------------------------
Ireland -- 2.51%
Allied Irish Banks PLC (ADR)
(Banking) 54,800 1,445,350
- -------------------------------------------------------------------------
Italy -- 3.93%
Istituto Mobiliare SpA (ADR)
(Banking) 68,700 1,082,025
Sasib SpA - Savings Shares
(Capital Goods) 352,000 782,982
STET - Savings Shares
(Communications) 197,715 400,670
----------
2,265,677
- -------------------------------------------------------------------------
Japan -- 7.06%
Canon Inc.
(Visual Image Equipment) 86,000 1,421,734
Ito-Yokado (ADR)
(Retailing) 6,700 1,309,431
Matsushita Electric Industries
(Consumer Electronics Equip.) 83,000 1,343,353
----------
4,074,518
- -------------------------------------------------------------------------
Korea -- 1.93%
Korea Fund Inc.
(Closed-End Mutual Fund) 52,000 1,111,500
- -------------------------------------------------------------------------
Netherlands -- 2.98%
AKZO Nobel NV
(Chemicals) 3,538 387,246
Koninklijke Ahold NV (ADR)
(Grocery Retailing) 38,281 1,330,265
----------
1,717,511
- -------------------------------------------------------------------------
</TABLE>
20
<PAGE> 76
BARTLETT VALUE INTERNATIONAL FUND (Cont.)
As of March 31, 1995
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- -------------------------------------------------------------------------
<S> <C> <C>
Norway -- 4.93%
Hafslund Nycomed Cl.B (ADR)
(Health) 75,500 $1,500,563
Kvaerner Cl. A Free Shares
(Shipbuilding) 28,200 1,339,806
----------
2,840,369
- -------------------------------------------------------------------------
Portugal -- 1.75%
Portugal Fund Inc.
(Closed-End Mutual Fund) 79,000 1,007,250
- -------------------------------------------------------------------------
Singapore -- 2.48%
Jurong Shipyard, Ltd.
(Shipbuilding) 167,000 1,431,598
- -------------------------------------------------------------------------
Spain -- 6.22%
Banco Santander SA Reg
(Banking) 20,518 723,132
Banco Santander SA Namen
(Banking) 6,839 239,950
Repsol SA (ADR)
(Energy) 46,200 1,339,800
Telefonica de Espana SA(ADR)
(Communications) 34,250 1,284,375
----------
3,587,257
- -------------------------------------------------------------------------
Sweden -- 6.24%
AGA AB-"B" Free Shares
(Gas Supplier) 120,000 1,267,600
Atlas Copco AB-"A" Free Shares
(Construction/Mining
Manufacturer) 95,000 1,152,425
Frigoscandia AB-"B" Free Shs.
(Warehousing) 346,000 1,179,005
----------
3,599,030
- -------------------------------------------------------------------------
Switzerland -- 6.21%
George Fischer, Bearer
(Capital Goods) 727 837,483
Nestle SA
(Food Manufacturer) 1,550 1,517,723
Sandoz AG
(Pharmaceuticals) 1,900 1,229,065
----------
3,584,271
- -------------------------------------------------------------------------
Taiwan -- 1.81%
Taiwan Fund Inc.
(Closed-End Mutual Fund) 49,300 1,041,462
- -------------------------------------------------------------------------
United Kingdom -- 7.40%
Cadbury Schweppes PLC (ADR)
(Beverages) 51,600 $ 1,480,275
Grand Metropolitan PLC (ADR)
(Consumer Goods) 52,300 1,346,725
Tomkins PLC (ADR)
(Diversified) 91,500 1,441,125
----------
4,268,125
- -------------------------------------------------------------------------
TOTAL COMMON STOCK $53,061,416
- -------------------------------------------------------------------------
(Cost-$49,361,706)
</TABLE>
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
CONVERTIBLE BONDS -- 2.88%
- -------------------------------------------------------------------------
<S> <C> <C>
Laidlaw, Inc. (Canada)
6.00%, 1/15/99 $ 700,000 $ 771,750
BCP Bank & Trust Co.
(Portugal)
8.75%, 5/21/02 650,000 887,471
- -------------------------------------------------------------------------
TOTAL CONVERTIBLE BONDS $1,659,221
- -------------------------------------------------------------------------
(Cost-$1,706,571)
- -------------------------------------------------------------------------
COMMERCIAL PAPER -- 6.07%
- -------------------------------------------------------------------------
Ford Motor Credit Corp.
5.74%, 4/12/95 $ 1,500,000 $ 1,500,000
General Electric Cap. Corp.
5.74%, 4/15/95 2,000,000 2,000,000
- -------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER $3,500,000
- -------------------------------------------------------------------------
(Cost-$3,500,000)
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- -------------------------------------------------------------------------
INVESTMENT COMPANIES -- 0.78%
- -------------------------------------------------------------------------
<S> <C> <C>
Highmark Government
Obligations Fund 452,853 $ 452,853
- -------------------------------------------------------------------------
TOTAL INVESTMENT COMPANIES $452,853
- -------------------------------------------------------------------------
(Cost-$452,853)
- -------------------------------------------------------------------------
TOTAL INVESTMENTS
AT VALUE -- 101.75% $58,673,490
- -------------------------------------------------------------------------
(Cost-$55,021,130)
- -------------------------------------------------------------------------
ALL OTHER ASSETS LESS LIABILITIES -- (1.75%) (1,009,777)
- -------------------------------------------------------------------------
NET ASSETS -- 100.00% $57,663,713
=========================================================================
</TABLE>
*Non-dividend paying investment.
See accompanying notes to financial statements.
21
<PAGE> 77
BARTLETT BASIC VALUE FUND
As of March 31, 1995
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCK -- 85.62%
- -------------------------------------------------------------------------
<S> <C> <C>
Aerospace/Defense -- 5.40%
Lockheed Martin Corp 65,000 $ 3,436,875
Raytheon Co. 29,000 2,113,375
----------
5,550,250
- -------------------------------------------------------------------------
Air Transportation -- 1.71%
AMR Corp.* 27,150 1,757,963
- -------------------------------------------------------------------------
Apparel -- 2.27%
Kellwood Co. 125,000 2,328,125
- -------------------------------------------------------------------------
Automobiles &
Auto Parts -- 2.68%
General Motors Corp. 62,275 2,755,669
- -------------------------------------------------------------------------
Broadcasting -- 5.30%
Multimedia, Inc. 86,000 3,251,875
Time Warner, Inc. 58,000 2,189,500
----------
5,441,375
- -------------------------------------------------------------------------
Chemicals -- 2.18%
Bayer AG (ADR) 90,500 2,239,875
- -------------------------------------------------------------------------
Communications -- 1.47%
Telefonica de Espana SA (ADR) 40,200 1,507,500
- -------------------------------------------------------------------------
Diversified -- 9.87%
Canadian Pacific Ltd.(ADR) 107,050 1,605,750
Hanson PLC (ADR) 103,750 1,958,281
ITT Corp. 22,125 2,270,578
Loews Corp. 24,000 2,370,000
Tenneco, Inc. 41,000 1,932,125
----------
10,136,734
- -------------------------------------------------------------------------
Energy -- 8.66%
Cabot Oil & Gas Corp., Class A 140,700 2,198,437
Phillips Petroleum Co. 65,000 2,380,625
Plains Petroleum Co. 26,000 607,750
Southwestern Energy Co. 125,000 1,875,000
Total SA (ADR) 61,000 1,830,000
----------
8,891,812
- -------------------------------------------------------------------------
Financial Services -- 18.64%
Federal National Mortgage Assn. 25,000 2,034,375
First America Bank Corp. 43,650 1,467,731
First Tennessee National Corp. 30,469 1,264,464
PMC Capital, Inc. 40,000 465,000
Regions Financial Corp. 49,185 1,792,178
Salomon, Inc. 30,000 1,016,250
Security Capital Bancorp 114,400 2,102,100
Star Banc Corp. 32,000 1,340,000
State Auto Financial Corp. 79,800 1,306,725
Student Loan Marketing Assn. 48,000 1,674,000
Torchmark Corp. 50,500 2,095,750
U.S. Trust Corp. 20,000 1,380,000
Washington Fed. Svg. & Loan 60,000 1,207,500
----------
19,146,073
- -------------------------------------------------------------------------
Food & Beverage -- 2.47%
Guinness PLC (ADR) 45,000 $ 1,698,750
Nestle SA (ADR) 17,260 837,110
------------
2,535,860
- -------------------------------------------------------------------------
Health Care -- 2.85%
Bristol Myers-Squibb Co. 16,000 1,008,000
Merck & Co., Inc. 45,000 1,918,125
----------
2,926,125
- -------------------------------------------------------------------------
Housewares -- 1.98%
National Presto Ind., Inc. 50,000 2,031,250
- -------------------------------------------------------------------------
Machinery -- 2.29%
Kaydon Corp. 40,000 1,055,000
York International 33,000 1,295,250
----------
2,350,250
- -------------------------------------------------------------------------
Metals & Mining -- 2.81%
Potash Corp of
Saskatchewan (ADR) 65,000 2,892,500
- -------------------------------------------------------------------------
Paper -- 1.35%
Wausau Paper Mills Co. 61,721 1,388,723
- -------------------------------------------------------------------------
Retailing -- 1.73%
Federated Dept. Stores 75,000 1,659,375
Grossman's, Inc.* 55,000 115,159
----------
1,774,534
- -------------------------------------------------------------------------
Security Services -- 1.31%
ADT, Ltd. (ADR) 110,000 1,347,500
- -------------------------------------------------------------------------
Steel Products -- 1.74%
British Steel PLC (ADR) 68,000 1,785,000
- -------------------------------------------------------------------------
Tobacco -- 1.90%
Philip Morris Cos., Inc. 30,000 1,957,500
- -------------------------------------------------------------------------
Utilities -- 3.20%
KU Energy, Inc. 51,300 1,417,162
NIPSCO Ind., Inc. 60,000 1,867,500
----------
3,284,662
- -------------------------------------------------------------------------
Other Common Stock -- 3.81%
ROC Communities (REIT) 50,000 1,012,500
Royce Value Trust, Inc.
(Closed-End Mutual Fund) 255,568 2,907,086
----------
3,919,586
- -------------------------------------------------------------------------
TOTAL COMMON STOCK $87,948,866
- -------------------------------------------------------------------------
(Cost $69,829,993)
- -------------------------------------------------------------------------
PREFERRED STOCK -- 0.78%
- -------------------------------------------------------------------------
J.P. Morgan Co., Adj. Rate Pfd. "A" 12,000 $ 801,000
- -------------------------------------------------------------------------
TOTAL PREFERRED STOCK $ 801,000
- -------------------------------------------------------------------------
(Cost $738,250)
</TABLE>
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
CONVERTIBLE BONDS -- 1.03%
- -------------------------------------------------------------------------
<S> <C> <C>
Rite Aid Corp.
0.00%, 7/24/06 $ 2,250,000 $ 1,061,775
- -------------------------------------------------------------------------
TOTAL CONVERTIBLE BONDS $ 1,061,775
- -------------------------------------------------------------------------
(Cost $991,406)
</TABLE>
22
<PAGE> 78
BARTLETT BASIC VALUE FUND (Cont.)
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
CORPORATE BONDS -- 1.93%
- -------------------------------------------------------------------------
<S> <C> <C>
Merrill Lynch
6.14%, 1/26/00 $ 2,000,000 $ 1,985,000
- -------------------------------------------------------------------------
TOTAL CORPORATE BONDS $ 1,985,000
- -------------------------------------------------------------------------
(Cost $1,977,980)
- -------------------------------------------------------------------------
COMMERCIAL PAPER -- 11.19%
- -------------------------------------------------------------------------
Associates Corp.
5.88%, 4/4/95 $ 2,000,000 $ 1,999,020
Chevron Oil Financial Corp.
5.95%, 4/5/95 2,000,000 1,998,678
IBM Comm. Credit Corp.
5.88%, 4/3/95 2,000,000 1,999,347
John Deere Capital Corp.
6.00%, 4/7/95 2,000,000 1,998,000
Texaco Capital Corp.
5.90%, 4/4/95 3,500,000 3,498,279
- -------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER $11,493,324
- -------------------------------------------------------------------------
(Cost $11,484,557)
- -------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 1.03%
- -------------------------------------------------------------------------
The Provident Bank,
6.15%, issued 3/31/95, due
4/3/95, collateralized by
U.S. Treasury Notes, 4.125%
(par value $1,070,000,
due 6/30/95) (repurchase
proceeds $1,054,540) $1,054,000 $ 1,054,000
- -------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 1,054,000
- -------------------------------------------------------------------------
(Cost $1,054,000)
- -------------------------------------------------------------------------
TOTAL INVESTMENTS
AT VALUE -- 101.58% $104,343,965
- -------------------------------------------------------------------------
(Cost $86,076,186)
- -------------------------------------------------------------------------
ALL OTHER ASSETS
LESS LIABILITIES -- (1.58)% ($1,623,047)
- -------------------------------------------------------------------------
NET ASSETS -- 100.00% $102,720,918
=========================================================================
</TABLE>
*Non-dividend paying investment.
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------
BARTLETT FIXED INCOME FUND
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
U.S. GOVERNMENT AND
AGENCIES OBLIGATIONS
-- 81.78%
- -------------------------------------------------------------------------
U.S. Treasury Obligations
-- 35.34%
- -------------------------------------------------------------------------
<S> <C> <C>
U.S. Treasury Note
7.250%, 11/30/96 $ 4,200,000 $ 4,233,470
U.S. Treasury Note
7.875%, 04/15/98 11,950,000 12,252,490
U.S. Treasury Note
6.875%, 08/31/99 5,000,000 4,965,625
U.S. Treasury Note
7.500%, 10/31/99 6,175,000 6,276,307
U.S. Treasury Note
5.875%, 02/15/04 5,000,000 4,560,155
------------
32,288,047
- -------------------------------------------------------------------------
U.S. Government Agency Obligations
-- 5.24%
- -------------------------------------------------------------------------
Federal Home Loan Banks
Inverse French Franc
Pibor-Indexed
Consolidated Bonds
5.729%, 02/09/96 1,200,000 1,182,600
Federal Home Loan Banks
Inverse French Franc
Pibor-Indexed
Consolidated Bonds
3.000%, 06/29/98 $ 4,000,000 $ 3,602,800
------------
4,785,400
- -------------------------------------------------------------------------
Mortgage-Backed Obligations
-- 41.20%
- -------------------------------------------------------------------------
Federal National Mortgage
Assn.-REMIC CMO
6.500%, 09/25/08 $ 664,526 $ 644,798
Federal National Mortgage
Assn.-REMIC CMO
6.650%, 01/25/17 5,000,000 4,801,565
Federal Home Loan Mortgage
Corp.-REMIC CMO
6.250%, 04/15/19 2,067,247 1,984,557
Federal National Mortgage
Assn.-REMIC CMO
7.000%, 09/25/20 2,250,000 2,171,250
Federal National Mortgage
Assn.-REMIC CMO
Floating Rate Note
6.625%, 12/25/20 5,075,000 4,957,641
</TABLE>
23
<PAGE> 79
BARTLETT FIXED INCOME FUND (Cont.)
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
<S> <C> <C>
Government National
Mortgage Assn.
9.000%, 06/15/16-3/15/25 $15,395,490 $ 15,939,150
Government National
Mortgage Assn.
6.000%, 10/15/23-3/15/24 8,182,449 7,136,634
------------
37,635,595
- -------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AND
AGENCIES OBLIGATIONS $74,709,042
- -------------------------------------------------------------------------
(Cost-$75,237,617)
- -------------------------------------------------------------------------
CORPORATE OBLIGATIONS
-- 12.89%
- -------------------------------------------------------------------------
Associates Corp. of N. Amer.
6.750%, 07/15/97 $ 5,250,000 $ 5,198,550
Merrill Lynch
6.140%, 01/26/00 1,350,000 1,339,875
Pepsico Corp.
Step Up Rate Note
7.000%, 10/14/99 5,250,000 5,240,025
- -------------------------------------------------------------------------
TOTAL CORPORATE OBLIGATIONS $11,778,450
- -------------------------------------------------------------------------
(Cost-$11,827,463)
- -------------------------------------------------------------------------
COMMERCIAL PAPER -- 2.74%
- -------------------------------------------------------------------------
Deere & Co.
6.00%, 04/17/95 $ 2,500,000 $ 2,497,500
- -------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER $ 2,497,500
- -------------------------------------------------------------------------
(Cost $2,497,083)
- -------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 1.01%
- -------------------------------------------------------------------------
The Provident Bank,
6.15%, issued 3/31/95,
due 4/3/95, collateralized
by U.S. Treasury Notes,
4.125% (par value $935,000,
due 6/30/95) (repurchase
proceeds $919,471) $ 919,000 $ 919,000
- -------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 919,000
- -------------------------------------------------------------------------
(Cost-$919,000)
- -------------------------------------------------------------------------
TOTAL INVESTMENTS AT VALUE
-- 98.42% $ 89,903,992
- -------------------------------------------------------------------------
(Cost $90,481,163)
- -------------------------------------------------------------------------
ALL OTHER ASSETS LESS LIABILITIES
-- 1.58% $ 1,445,466
- -------------------------------------------------------------------------
NET ASSETS -- 100.00% $ 91,349,458
=========================================================================
</TABLE>
See accompanying notes to financial statements.
24
<PAGE> 80
BARTLETT SHORT TERM BOND FUND
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
U.S. GOVERNMENT AND
AGENCIES OBLIGATIONS -- 72.48%
- -------------------------------------------------------------------------
U.S. Treasury Obligations -- 10.13%
- -------------------------------------------------------------------------
<S> <C> <C>
U.S. Treasury Note
7.250%, 11/30/96 $1,000,000 $ 1,007,969
U.S. Treasury Note
6.500%, 08/15/97 1,000,000 992,500
------------
2,000,469
- -------------------------------------------------------------------------
U.S. Government Obligations -- 13.11%
- -------------------------------------------------------------------------
Federal Home Loan Banks
Inverse French Franc
Pibor-Indexed
Consolidated Bonds
5.729%, 02/09/96 $ 600,000 $ 591,300
Federal Home Loan Banks
Libor-Indexed
Consolidated Bonds
6.856%, 04/15/98 1,500,000 1,435,050
Federal Home Loan Banks
Inverse French Franc
Pibor-Indexed
Consolidated Bonds
3.000%, 06/29/98 625,000 562,937
------------
2,589,287
- -------------------------------------------------------------------------
Mortgage-Backed Obligations -- 49.24%
- -------------------------------------------------------------------------
Federal National Mortgage
Assn.-REMIC CMO
6.500%, 09/25/08 $ 531,621 $ 515,838
Federal National Mortgage
Assn.-REMIC CMO
6.650%, 01/25/17 750,000 720,235
Federal National Mortgage
Assn.-REMIC CMO
7.000%, 03/25/19 475,000 461,344
Federal Home Loan Mortgage
Corp.-REMIC CMO
6.250%, 04/15/19 849,868 815,873
Federal National Mortgage
Assn.-REMIC CMO
7.000%, 10/25/19 750,000 720,938
Federal National Mortgage
Assn.-REMIC CMO
7.000%, 09/25/20 750,000 723,750
Federal National Mortgage
Assn.-REMIC CMO
Floating Rate Note
6.625%, 12/25/20 1,000,000 976,875
Government National
Mortgage Assn.
9.000%, 06/15/16-3/15/25 4,625,053 4,788,377
------------
9,723,230
- -------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AND
AGENCIES OBLIGATIONS $14,312,986
- -------------------------------------------------------------------------
(Cost-$14,580,889)
- -------------------------------------------------------------------------
CORPORATE OBLIGATIONS -- 14.13%
- -------------------------------------------------------------------------
Merrill Lynch
6.140%, 01/26/00 $ 1,150,000 $ 1,141,375
Merrill Lynch
Step Up Rate Note
8.230%, 04/30/02 150,000 151,313
Pepsico Corp.
Step Up Rate Note
7.000%, 10/14/99 1,500,000 1,497,150
- -------------------------------------------------------------------------
TOTAL CORPORATE OBLIGATIONS $ 2,789,838
- -------------------------------------------------------------------------
(Cost-$2,793,906)
- -------------------------------------------------------------------------
COMMERCIAL PAPER -- 5.06%
IBM Comm. Credit Corp.
5.88%, 4/3/95 $ 1,000,000 $ 999,673
- -------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER $ 999,673
- -------------------------------------------------------------------------
(Cost $998,203)
- -------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 7.22%
- -------------------------------------------------------------------------
The Provident Bank,
6.15%, issued 3/31/95,
due 4/3/95, collateralized
by U.S. Treasury Notes,
4.125% (par value $1,450,000,
due 6/30/95) (repurchase
proceeds $1,426,731) $ 1,426,000 $ 1,426,000
- -------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 1,426,000
- -------------------------------------------------------------------------
(Cost-$1,426,000)
- -------------------------------------------------------------------------
TOTAL INVESTMENTS AT VALUE -- 98.89% $19,528,497
- -------------------------------------------------------------------------
(Cost-$19,798,998)
- -------------------------------------------------------------------------
FUTURES CONTRACTS
SOLD -- 0.00% Contracts
- -------------------------------------------------------------------------
2 Yr. Treasury Note Futures
June Expiration 20 $ (1,761)
5 Yr. Treasury Note Futures
June Expiration 10 915
10 Yr. Treasury Note Futures
June Expiration 2 230
- -------------------------------------------------------------------------
TOTAL FUTURES CONTRACTS SOLD $ (616)
- -------------------------------------------------------------------------
ALL OTHER ASSETS LESS LIABILITIES
-- 1.11% $ 220,220
- -------------------------------------------------------------------------
NET ASSETS -- 100.00% $19,748,101
=========================================================================
</TABLE>
See accompanying notes to financial statements.
25
<PAGE> 81
BARTLETT CASH RESERVES FUND
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
COMMERCIAL PAPER -- 89.26%
- -------------------------------------------------------------------------
<S> <C> <C>
Abbott Laboratories
5.94%, 04/13/95 $1,581,000 $1,577,791
Abbott Laboratories
5.95%, 04/19/95 1,500,000 1,495,515
Anheuser-Busch
5.96%, 04/11/95 1,000,000 998,308
Anheuser-Busch
5.95%, 05/05/95 2,000,000 1,988,704
Associates Corp. of N. Amer.
6.02%, 05/31/95 1,000,000 990,033
Associates Corp. of N. Amer.
6.00%, 06/05/95 2,000,000 1,978,405
AT&T Capital Corp.
6.00%, 04/06/95 3,000,000 2,997,462
Bell Atlantic Financial Corp.
5.95%, 04/04/95 3,000,000 2,998,478
Bellsouth Capital Funding Corp.
5.93%, 04/18/95 3,000,000 2,991,528
Beneficial Corporation
6.02%, 05/30/95 3,000,000 2,970,598
Chevron Oil Finance Co.
6.00%, 05/18/95 1,500,000 1,488,289
Chevron Oil Finance Co.
6.00%, 05/23/95 1,500,000 1,487,043
Coca-Cola Co.
5.92%, 04/03/95 3,000,000 2,998,985
CPC International
6.03%, 05/26/95 3,000,000 2,972,591
Deere & Co. Capital Corp.
5.95%, 04/11/95 1,500,000 1,497,463
Deere & Co. Capital Corp.
5.95%, 04/12/95 1,500,000 1,497,209
Ford Motor Credit Co.
5.95%, 04/05/95 1,500,000 1,498,985
Ford Motor Credit Co.
6.02%, 05/15/95 1,500,000 1,489,037
General Electric Capital Corp.
6.00%, 05/22/95 1,500,000 1,487,293
General Electric Capital Corp.
6.00%, 05/30/95 1,500,000 1,485,299
General Mills Co.
5.96%, 04/04/95 1,000,000 999,493
H.J. Heinz Co.
5.98%, 04/03/95 1,000,000 999,662
H.J. Heinz Co.
5.98%, 04/13/95 500,000 498,985
H.J. Heinz Co.
5.94%, 04/20/95 1,500,000 1,495,266
IBM Corporation
5.95%, 04/05/95 $1,000,000 $ 999,323
IBM Corporation
6.03%, 04/10/95 2,000,000 1,996,955
J.C. Penny Funding Corp.
5.95%, 04/28/95 1,500,000 1,493,273
Kellog Co.
5.93%, 04/20/95 1,000,000 996,844
Kimberly Clark
5.95%, 04/24/95 1,500,000 1,494,269
Lilly, Eli & Co.
5.93%, 04/06/95 2,000,000 1,998,308
Lilly, Eli & Co.
6.03%, 04/13/95 1,000,000 997,970
Motorola Inc.
5.96%, 04/03/95 2,000,000 1,999,323
Norwest Financial Inc.
5.95%, 04/25/95 2,000,000 1,992,027
Norwest Financial Inc.
6.03%, 06/29/95 1,000,000 985,167
Pepsico, Inc.
5.93%, 04/12/95 1,000,000 998,139
R.R. Donnelley
5.93%, 04/04/95 1,000,000 999,493
R.R. Donnelley
6.02%, 04/13/95 1,960,000 1,956,021
Raytheon Corp.
5.94%, 04/21/95 1,500,000 1,495,017
Sears Roebuck Acc. Corp.
6.02%, 05/22/95 3,000,000 2,974,585
Shell Oil Company
5.96%, 05/10/95 3,000,000 2,980,565
Smithkline Beecham
5.96%, 04/28/95 1,300,000 1,294,170
Smithkline Beecham
6.00%, 05/30/95 1,500,000 1,485,299
Southwest Bell Capital Corp.
6.00%, 05/23/95 2,500,000 2,478,406
U.S. West Comm. Corp.
5.97%, 04/03/95 2,000,000 1,999,323
U.S. West Comm. Corp.
5.98%, 05/08/95 1,000,000 993,854
Wal-Mart Corp
5.95%, 04/07/95 3,000,000 2,996,955
- -------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER $80,487,708
- -------------------------------------------------------------------------
(Cost-$80,119,250)
</TABLE>
26
<PAGE> 82
BARTLETT CASH RESERVES FUND (Cont.)
As of March 31, 1995
<TABLE>
<CAPTION>
FACE MARKET
AMOUNT VALUE
- -------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 0.52%
- -------------------------------------------------------------------------
<S> <C> <C>
The Provident Bank, 6.15%,
issued 3/31/95, due 4/3/95,
collateralized by U.S. Treasury
Notes, 4.125% (par value
$480,000, due 6/30/95)
(repurchase proceeds
$468,240) $ 468,000 $ 468,000
- -------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 468,000
- -------------------------------------------------------------------------
(Cost-$468,000)
- -------------------------------------------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS -- 8.01%
- -------------------------------------------------------------------------
Federal Farm Credit Corp.
5.95%, 06/27/95 $3,000,000 $2,956,500
Federal National Mortgage
Assn. Agency Note
5.96%, 06/26/95 1,335,000 1,315,865
Federal National Mortgage
Assn. Agency Note
5.98%, 06/30/95 3,000,000 2,955,000
- -------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT
AND AGENCY OBLIGATIONS $ 7,227,365
- -------------------------------------------------------------------------
(Cost-$7,225,076)
- -------------------------------------------------------------------------
TOTAL INVESTMENTS
AT VALUE -- 97.79% $88,183,073
- -------------------------------------------------------------------------
(Cost-$87,812,326)
- -------------------------------------------------------------------------
ALL OTHER ASSETS LESS
LIABILITIES -- 2.21% 1,989,213
- -------------------------------------------------------------------------
NET ASSETS -- 100.00% $90,172,286
=========================================================================
</TABLE>
REIT-Real Estate Investment Trust.
REMIC-Real Estate Mortgage Investment Conduit.
CMO-Collateralized Mortgage Obligation.
Inverse French Franc Pibor-Indexed Consolidated Bonds-Represent structured
securities that pay interest at a rate that increases (decreases) with a
decline (increase) in the Pibor (Paris InterBank Offered Rate). Interest rates
disclosed are in effect at March 31, 1995.
Libor-Indexed Consolidated Bonds-Represents a structured security that pays
interest at a rate that increases (decreases) with an increase (decrease) in
the Libor (London InterBank Offered Rate). Interest rates disclosed are in
effect at March 31, 1995.
See accompanying notes to financial statements.
27
<PAGE> 83
====================================
STATEMENTS OF ASSETS AND LIABILITIES
====================================
As of March 31, 1995
<TABLE>
<CAPTION>
BARTLETT
BARTLETT BARTLETT BARTLETT SHORT BARTLETT
VALUE BASIC FIXED TERM CASH
INTERNATIONAL VALUE INCOME BOND RESERVES
FUND FUND FUND FUND FUND
================================================================================================================
ASSETS:
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment securities,
at original cost
(Note 1) $ 55,021,130 $ 86,076,186 $ 90,481,163 $ 19,798,998 $ 87,812,326
================================================================================================================
Investment securities,
at value (Note 1) $ 58,673,490 $104,343,965 $ 89,903,992 $ 19,528,497 $ 88,183,073
Dividends and interest
receivable 224,842 188,154 1,281,142 207,138 80
Receivable for share
purchases 41,499 49,048 334,090 41,132 2,117,395
Cash -- 9 472 485 823
- ----------------------------------------------------------------------------------------------------------------
Total Assets 58,939,831 104,581,176 91,519,696 19,777,252 90,301,371
- ----------------------------------------------------------------------------------------------------------------
LIABILITIES:
- ----------------------------------------------------------------------------------------------------------------
Shareholder
distributions payable 19,154 21,842 65,338 29,068 16,218
Payable for securities
purchased 1,237,483 -- -- -- --
Shareholder
redemptions payable 19,481 1,838,416 104,900 83 112,867
- ----------------------------------------------------------------------------------------------------------------
Total Liabilities 1,276,118 1,860,258 170,238 29,151 129,085
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS $ 57,663,713 $102,720,918 $ 91,349,458 $ 19,748,101 $ 90,172,286
================================================================================================================
Net Assets Consist of:
Capital shares $ 54,245,228 $ 83,024,401 $ 95,941,365 $ 20,493,427 $ 90,269,413
Accumulated
undistributed net
investment income 11,126 22,163 -- -- --
Accumulated net realized
gains (losses) from
security transactions (253,272) 1,499,998 (4,047,747) (510,375) (96,522)
Net unrealized
appreciation/(depreciation)
on investments 3,660,631 18,174,356 (544,160) (234,951) (605)
- ----------------------------------------------------------------------------------------------------------------
Net Assets $ 57,663,713 $102,720,918 $ 91,349,458 $ 19,748,101 $ 90,172,286
================================================================================================================
Shares of beneficial
interest outstanding
(unlimited number
of shares authorized,
no par value) (Note 4) 4,952,364 6,673,071 9,418,434 2,043,270 90,269,413
================================================================================================================
Net asset value,
offering and redemption
price per share (Note 1) $ 11.64 $15.39 $9.70 $9.66 $1.00
================================================================================================================
</TABLE>
See accompanying notes to financial statements.
28
<PAGE> 84
===================================
STATEMENTS OF OPERATIONS
===================================
For The Year Ended March 31, 1995
<TABLE>
<CAPTION>
BARTLETT
BARTLETT BARTLETT BARTLETT SHORT BARTLETT
VALUE BASIC FIXED TERM CASH
INTERNATIONAL VALUE INCOME BOND RESERVES
FUND FUND FUND FUND FUND
==================================================================================================================================
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
- ----------------------------------------------------------------------------------------------------------------------------------
Interest $ 322,960 $ 710,815 $ 6,590,664 $ 1,383,918 $ 3,890,626
Dividends 1,300,281 2,231,163 -- -- --
Less foreign taxes withheld (148,644) -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 1,474,597 2,941,978 6,590,664 1,383,918 3,890,626
- ----------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
- ----------------------------------------------------------------------------------------------------------------------------------
Management Fee (Note 3) 1,025,125 1,173,808 998,750 190,629 614,397
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL EXPENSES 1,025,125 1,173,808 998,750 190,629 614,397
- ----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 449,472 1,768,170 5,591,914 1,193,289 3,276,229
- ----------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS:
Net realized gains (losses) from
security transactions 2,425,836 4,359,075 (3,280,414) (497,579) (81,479)
Net change in net unrealized
appreciation (depreciation)
on investments (3,917,520) 5,759,310 (407,515) (127,141) 13,459
- ----------------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS (1,491,684) 10,118,385 (3,687,929) (624,720) (68,020)
- ----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS ($1,042,212) $11,886,555 $ 1,903,985 $ 568,569 $ 3,208,209
==================================================================================================================================
</TABLE>
See accompanying notes to financial statements
29
<PAGE> 85
=====================================
STATEMENTS OF CHANGES IN NET ASSETS
=====================================
<TABLE>
<CAPTION>
BARTLETT BARTLETT
VALUE INTERNATIONAL FUND BASIC VALUE FUND
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
3/31/95 3/31/94 3/31/95 3/31/94
==============================================================================================================
FROM OPERATIONS:
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income $ 449,472 $ 214,296 $ 1,768,170 $ 1,481,651
Net realized gains (losses) from
security transactions 2,425,836 659,154 4,359,075 4,762,276
Net change in net unrealized
appreciation (depreciation)
on investments (3,917,520) 7,020,730 5,759,310 (2,745,345)
- --------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS (1,042,212) 7,894,180 11,886,555 3,498,582
- --------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS:
- --------------------------------------------------------------------------------------------------------------
From net investment income (438,346) (214,296) (1,765,417) (1,522,408)
From net realized gains from
security transactions (2,727,131) (12,949) (6,700,292) (926,246)
- --------------------------------------------------------------------------------------------------------------
DECREASE IN NET ASSETS FROM
DISTRIBUTIONS TO SHAREHOLDERS (3,165,477) (227,245) (8,465,709) (2,448,654)
- --------------------------------------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS (NOTE 4):
- --------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 41,462,779 20,288,986 88,106,512 89,413,590
Net asset value of shares issued
in reinvestment of shareholder
distributions 2,650,327 154,573 8,073,721 2,356,958
Payment for shares redeemed (31,848,784) (8,075,630) (91,168,817) (102,038,558)
- --------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) FROM FUND
SHARE TRANSACTIONS 12,264,322 12,367,929 5,011,416 (10,268,010)
- --------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 8,056,633 20,034,864 8,432,262 (9,218,082)
NET ASSETS:
Beginning of period 49,607,080 29,572,216 94,288,656 103,506,738
- --------------------------------------------------------------------------------------------------------------
End of period $ 57,663,713 $49,607,080 $102,720,918 $ 94,288,656
==============================================================================================================
ACCUMULATED UNDISTRIBUTED NET
INVESTMENT INCOME $ 11,126 $ -- $ 22,163 $ 19,410
==============================================================================================================
</TABLE>
(a) From the start of business (February 4, 1994) through March 31, 1994.
See accompanying notes to financial statements.
30
<PAGE> 86
<TABLE>
<CAPTION>
BARTLETT
BARTLETT SHORT TERM BARTLETT
FIXED INCOME FUND BOND FUND CASH RESERVES FUND
YEAR YEAR YEAR PERIOD YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
3/31/95 3/31/94 3/31/95 3/31/94(a) 3/31/95 3/31/94
===================================================================================================================================
FROM OPERATIONS:
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income $ 5,591,914 $ 5,769,139 $ 1,193,289 $ 117,373 $ 3,276,229 $ 1,901,641
Net realized gains (losses) from
security transactions (3,280,414) 855,388 (497,579) (12,796) (81,479) (8,622)
Net change in net unrealized
appreciation (depreciation)
on investments (407,515) (4,109,034) (127,141) (107,810) 13,459 (133,776)
- -----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS 1,903,985 2,515,493 568,569 (3,233) 3,208,209 1,759,243
- -----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS:
- -----------------------------------------------------------------------------------------------------------------------------------
From net investment income (5,591,914) (5,769,139) (1,193,289) (117,373) (3,276,229) (1,901,641)
From net realized gains from
security transactions -- (1,977,803) -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
DECREASE IN NET ASSETS FROM
DISTRIBUTIONS TO SHAREHOLDERS (5,591,914) (7,746,942) (1,193,289) (117,373) (3,276,229) (1,901,641)
- -----------------------------------------------------------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS (NOTE 4):
- -----------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 32,641,620 55,815,622 34,220,058 24,268,104 367,680,400 378,988,776
Net asset value of shares issued
in reinvestment of shareholder
distributions 4,778,669 6,771,929 838,351 82,427 3,115,274 1,752,947
Payment for shares redeemed (53,796,673) (81,429,392) (36,973,689) (1,941,824) (358,112,926) (369,003,477)
- -----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) FROM FUND
SHARE TRANSACTIONS (16,376,384) (18,841,841) (1,915,280) 22,408,707 12,682,748 11,738,246
- -----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (20,064,313) (24,073,290) (2,540,000) 22,288,101 12,614,728 11,595,848
NET ASSETS:
Beginning of period 111,413,771 135,487,061 22,288,101 0 77,557,558 65,961,710
- -----------------------------------------------------------------------------------------------------------------------------------
End of period $ 91,349,458 $111,413,771) $ 19,748,101 $ 22,288,101 $ 90,172,286 $ 77,557,558
===================================================================================================================================
ACCUMULATED UNDISTRIBUTED NET
INVESTMENT INCOME $ -- $ -- $ -- $ -- $ -- $ --
===================================================================================================================================
</TABLE>
31
<PAGE> 87
=========================
FINANCIAL HIGHLIGHTS
=========================
<TABLE>
<CAPTION>
BARTLETT VALUE INTERNATIONAL FUND
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR ENDED MARCH 31,
1995 1994 1993 1992 1991
===================================================================================================
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 12.46 $ 10.08 $ 9.93 $ 9.09 $ 9.79
- ---------------------------------------------------------------------------------------------------
Income From Investment Operations:
Net Investment Income .09 .07 .12 .18 .30
Net Realized and Unrealized Gains
(Losses) on Securities (.21) 2.38 .15 .88 (.70)
- ---------------------------------------------------------------------------------------------------
Total From Investment Operations (.12) 2.45 .27 1.06 (.40)
- ---------------------------------------------------------------------------------------------------
Less Distributions:
Dividends From Net Investment
Income (.09) (.07) (.10) (.22) (.28)
Distributions From Realized Gains (.61) -- (.02) -- (.02)
- ---------------------------------------------------------------------------------------------------
Total Distributions (.70) (.07) (.12) (.22) (.30)
- ---------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.64 $ 12.46 $ 10.08 $ 9.93 $ 9.09
===================================================================================================
Total Return (1.18%) 24.42% 2.71% 11.88% (3.84%)
===================================================================================================
Ratios / Supplemental Data:
- ---------------------------
Net Assets, End of Period (000's) $57,664 $49,607 $29,572 $22,042 $23,661
Ratio of Net Expenses to Average
Net Assets (a) 1.83% 1.88% 2.00% 2.00% 1.99%
Ratio of Net Investment Income
to Average Net Assets (a) .80% .55% 1.13% 1.79% 3.31%
Portfolio Turnover Rate 24% 19% 19% 27% 39%
- ---------------------------------------------------------------------------------------------------
BARTLETT BASIC VALUE FUND
===================================================================================================
Net Asset Value, Beginning of Period $ 14.89 $ 14.76 $ 13.47 $ 12.60 $ 12.34
- ---------------------------------------------------------------------------------------------------
Income From Investment Operations:
Net Investment Income .27 .22 .30 .36 .46
Net Realized and Unrealized Gains
on Securities 1.53 .28 1.57 .87 .26
- ---------------------------------------------------------------------------------------------------
Total From Investment Operations 1.80 .50 1.87 1.23 .72
- ---------------------------------------------------------------------------------------------------
Less Distributions:
Dividends From Net Investment
Income (.27) (.23) (.30) (.36) (.46)
Distributions From Realized Gains (1.03) (.14) (.28) -- --
- ---------------------------------------------------------------------------------------------------
Total Distributions (1.30) (.37) (.58) (.36) (.46)
- ---------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 15.39 $ 14.89 $ 14.76 $ 13.47 $ 12.60
===================================================================================================
Total Return 12.67% 3.42% 14.22% 9.91% 6.29%
===================================================================================================
Ratios / Supplemental Data:
- ---------------------------
Net Assets, End of Period (000's) $102,721 $94,289 $103,507 $88,536 $96,165
Ratio of Expenses to Average
Net Assets 1.20% 1.20% 1.21% 1.22% 1.21%
Ratio of Net Investment Income
to Average Net Assets 1.81% 1.48% 2.14% 2.77% 3.87%
Portfolio Turnover Rate 26% 33% 43% 49% 92%
- ---------------------------------------------------------------------------------------------------
</TABLE>
(a) The Advisor has periodically absorbed expenses of the Bartlett Value
International Fund through management fee waiver. If the Advisor had not waived
any fees, the ratio of net expenses to average net assets would have been 1.94%
and the ratio of net investment income to average net assets would have been
.49% for the period ended March 31, 1994.
See accompanying notes to financial statements.
32
<PAGE> 88
BARTLETT FIXED INCOME FUND
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR ENDED MARCH 31,
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
====================================================================================================================
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $10.02 $10.48 $ 9.93 $ 9.63 $9.46
- --------------------------------------------------------------------------------------------------------------------
Income From Investment Operations:
Net Investment Income .54 .48 .59 .67 .73
Net Realized and Unrealized Gains
(Losses) on Securities (.32) (.30) .55 .31 .17
- --------------------------------------------------------------------------------------------------------------------
Total From Investment Operations .22 .18 1.14 .98 .90
- --------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends From Net Investment
Income (.54) (.48) (.59) (.68) (.73)
Distributions From Realized Gains -- (.16) -- -- --
- --------------------------------------------------------------------------------------------------------------------
Total Distributions (.54) (.64) (.59) (.68) (.73)
- --------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.70 $10.02 $10.48 $ 9.93 $9.63
====================================================================================================================
Total Return 2.41% 1.70% 11.81% 10.46% 9.86%
====================================================================================================================
Ratios / Supplemental Data:
- ---------------------------
Net Assets, End of Period (000's) $91,349 $111,414 $135,487 $147,992 $159,218
Ratio of Expenses to Average
Net Assets (a) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of Net Investment Income
to Average Net Assets 5.60% 4.58% 5.81% 6.85% 7.68%
Portfolio Turnover Rate 118% 163% 175% 126% 165%
Amount of Debt Outstanding
at End of Period $ -- $ -- $ -- $ -- $ --
Average Amount of Debt
Outstanding During the
Period (b) (000's) $ 255 $ 2,550 $ 12,627 $ 6,601 $ --
Average Number of Shares
Outstanding During the
Period (c) (000's) 10,270 12,095 13,689 15,577 --
Average Amount of Debt Per
Share During the Period $ 0.02 $ 0.21 $ 0.92 $ 0.42 $ --
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Ratios do not include interest paid on reverse repurchase agreements.
(b) The average amount of debt outstanding during the period was calculated by
aggregating borrowings at the end of each day and dividing that sum by the
number of days in the period.
(c) The average number of shares outstanding during the period was calculated by
averaging the number of shares outstanding at the end of each month in the
period.
See accompanying notes to financial statements.
33
<PAGE> 89
===========================
FINANCIAL HIGHLIGHTS
===========================
BARTLETT SHORT TERM BOND FUND
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR ENDED MARCH 31,
<TABLE>
<CAPTION>
1995 1994(a) 1993 1992 1991
======================================================================================================================
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $9.94 $10.00
- ----------------------------------------------------------------------------------------
Income From Investment Operations:
Net Investment Income .53 .06
Net Realized and Unrealized Gains
(Losses) on Securities (.28) (.06)
- ----------------------------------------------------------------------------------------
Total From Investment Operations .25 .00
- ----------------------------------------------------------------------------------------
Less Distributions:
Dividends From Net Investment Income (.53) (.06)
- ----------------------------------------------------------------------------------------
Total Distributions (.53) (.06)
- ----------------------------------------------------------------------------------------
Net Asset Value, End of Period $9.66 $9.94
========================================================================================
Total Return 2.58% .04%(b)
========================================================================================
Ratios / Supplemental Data:
- -----------------------------
Net Assets, End of Period (000's) $19,748 $22,288
Ratio of Expenses to Average
Net Assets .85% .85%(d)
Ratio of Net Investment Income
to Average Net Assets 5.38% 4.55%(d)
Portfolio Turnover Rate 158% 202%(d)
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
BARTLETT CASH RESERVES FUND
======================================================================================================================
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------------------------
Income From Investment Operations:
Net Investment Income .04 .03 .03 .05 .07
- ----------------------------------------------------------------------------------------------------------------------
Total From Investment Operations .04 .03 .03 .05 .07
- ----------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends From Net Investment Income (.04) (.03) (.03) (.05) (.07)
- ----------------------------------------------------------------------------------------------------------------------
Total Distributions (.04) (.03) (.03) (.05) (.07)
- ----------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00
======================================================================================================================
Total Return 4.22% 2.69% 3.26% 5.07% 7.32%
======================================================================================================================
Ratios / Supplemental Data:
- ---------------------------
Net Assets, End of Period (000's) $90,172 $77,558 $65,962 $75,867 $130,250
Ratio of Net Expenses
to Average Net Assets (c) .78% .77% .72% .67% .73%
Ratio of Net Investment Income
to Average Net Assets (c) 4.16% 2.71% 3.26% 5.05% 7.08%
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Except for the Bartlett Short Term Bond Fund which is from the date of
public offering (February 4, 1994) through March 31, 1994.
(b) Total return is for the period February 4, 1994 through March 31, 1994.
(c) The Advisor has periodically absorbed expenses of the Bartlett Cash Reserves
Fund through management fee waiver. If the Advisor had not waived any
fees, the ratios of net expenses to average net assets would have been
.88%, .90%, .90% and .90%, and the ratios of net investment income to
average net assets would have been 2.60%, 3.07%, 4.82%, and 6.91%, for the
periods ended March 31, 1994 through 1991, respectively.
(d) Annualized.
See accompanying notes to financial statements.
34
<PAGE> 90
========================================
NOTES TO FINANCIAL STATEMENTS
========================================
As of March 31, 1995
1. Significant Accounting Policies
Bartlett Capital Trust and Bartlett Management Trust are registered under
the Investment Company Act of 1940, as amended, as no-load, diversified,
open-end management investment companies. Bartlett Capital Trust was established
as a Massachusetts business trust under a Declaration of Trust dated October 31,
1982. The Declaration of Trust, as amended, permits the Trustees to issue an
unlimited number of shares of the Bartlett Value International Fund, Bartlett
Basic Value Fund, Bartlett Fixed Income Fund and the Bartlett Short Term Bond
Fund. The Bartlett Short Term Bond Fund started business and commenced the
public offering of shares on February 4, 1994. Bartlett Management Trust was
established as an Ohio business trust under a Declaration of Trust dated July
16, 1984. The Declaration of Trust, as amended, permits the Trustees to issue an
unlimited number of shares of the Bartlett Cash Reserves Fund, the only series
of the Trust presently authorized by the Trustees.
The following is a summary of the significant accounting policies of
Bartlett Capital Trust and Bartlett Management Trust:
Security Valuation - Equity securities, options and commodities listed on
exchanges are valued at the last sale price as of the close of business on the
day the securities are being valued. Listed securities not traded on a
particular day and securities traded in the over-the-counter market are valued
at the mean between closing bid and ask prices quoted by brokers or dealers that
make markets in the securities. Portfolio securities which are traded both in
the over-the-counter market and on an exchange are valued according to the
broadest and most representative market.
Fixed income securities generally are valued by using market quotations, or
independent pricing services which use prices provided by market makers or
estimates of market values. However, if Bartlett & Co. (the Advisor) believes
the market value of a security will be more accurately reflected thereby, it
will use market value estimates obtained from yield spreads relating to
securities with similar characteristics as to credit quality, coupon rate,
maturity and other factors. Fixed income securities having a maturity of less
than 60 days (except for those in Bartlett Cash Reserves Fund) are valued at
amortized cost, which approximates market value.
Securities, primarily fixed income securities, of a Fund for which market
quotations or estimates are not readily available are valued at fair value as
determined in good faith by the Advisor, subject to review of the Board of
Trustees.
The values of international securities are generally based upon market
quotations converted to U.S. dollar equivalents at 4:00 p.m. Eastern Standard
time which, depending upon the exchange or market, may be last sale price, last
bid price, or the mean between the last bid and asked prices as of, in each
case, the close of the appropriate exchange or another designated time. Trading
in securities on European and Far Eastern securities exchanges and
over-the-counter markets is normally completed at various times before the close
of business on each day on which the New York Stock Exchange (NYSE) is open.
Trading of these securities may not take place on every NYSE business day. In
addition, trading may take place in various foreign markets on Saturdays or on
other days when the NYSE is not open and on which the Fund's share price is not
calculated. Therefore, the value of Bartlett Value International Fund's
portfolio may be significantly affected on days when shares may not be purchased
or redeemed.
Repurchase agreements are valued at cost which approximates market. It is
the policy of each of the Funds that their custodian take possession of the
underlying collateral securities. Collateral is marked-to-market daily to ensure
that the market value of the underlying assets equals or exceeds the value of
the seller's repurchase obligation. In the event of a bankruptcy or other
default of the seller of a repurchase agreement, a Fund could experience both
delays in liquidating the underlying securities and losses. The loss would equal
the amount by which the carrying value of the repurchase agreement(s) exceeded
the proceeds received in liquidation of the underlying collateral securities. To
minimize the possibility of loss, the Funds enter into repurchase agreements
only with institutions deemed to be creditworthy by the Advisor, including banks
that serve as custodian for the Funds, banks having assets in excess of $1
billion or primary government securities dealers.
Structured Securities - Bartlett Basic Value Fund, Bartlett Fixed Income
Fund and Bartlett Short Term Bond Fund may invest in structured securities, a
type of
35
<PAGE> 91
=======================================
NOTES TO FINANCIAL STATEMENTS
=======================================
derivative security, which are derived from securities issued by U.S. government
agencies, or other issuers, and are denominated in U.S. dollars. Structured
securities are privately issued securities. These short maturity notes differ
from traditional debt securities in that the return (principal and/or interest)
is linked to the performance of a diversified array of financial indices.
The Funds use structured securities to add to portfolio diversification to
protect the portfolio against rising interest rates. An investment in structured
securities entails risks not associated with investments in conventional debt
securities. The secondary market for such securities will be affected by factors
independent of the creditworthiness of the issuer and the value of the index,
such as the volatility of the index, time remaining to maturity and the amount
of such securities outstanding.
Foreign Currency Translation - The books and records of each Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars on the following basis:
(i) market value of investment securities, other assets and
liabilities--at the daily rate of exchange as reported by a major
New York City bank at 4:00 p.m. Eastern Standard time;
(ii) purchases and sales of investment securities, income and
expenses--at the rate of exchange prevailing on the respective
dates of such transactions.
Futures and Options Accounting Principles - Premiums received from put or
call options written are recorded as an asset with an equal liability which is
marked-to-market daily with any difference between the option's current market
value and premiums received recorded as an unrealized gain or loss. If the
option is not exercised, premiums received are realized as a gain at the
expiration date. If the position is closed prior to expiration, a gain or loss
is realized based on premiums received less the cost of the closing transaction.
When an option is exercised, premiums received are added to the proceeds from
the sale of the underlying securities and a gain or loss is realized
accordingly.
Put and call options purchased are accounted for in the same manner as
portfolio securities. The cost of securities acquired through the exercise of
call options is increased by premiums paid. The proceeds from securities sold
through the exercise of put options are decreased by the premiums paid.
Futures contracts are marked-to market daily with fluctuations in value
settled daily in cash through a margin account. Gains or losses are realized at
the time the contract is closed out or the contract expires.
The primary risks associated with the use of futures contracts and options
are imperfect correlation between the change in market value of securities held
by the Funds and the prices of futures contracts and options, in addition to the
possibility of an illiquid market.
Reverse Repurchase Agreements - Bartlett Basic Value Fund, Bartlett Fixed
Income Fund, Bartlett Short Term Bond Fund and Bartlett Cash Reserves Fund may
enter into reverse repurchase agreements whereby the Funds transfer possession
of a security for cash with the intent to repay cash plus interest in exchange
for the return of the same security at a later date. A Fund's primary objective
in such a transaction would be to obtain funds to pursue additional investment
opportunities whose yield would exceed the cost of the reverse repurchase
transaction.
It is the policy of each of the Funds that their custodian place cash or
U.S. government obligations in a separate account in an amount equal to the
reverse repurchase agreement obligation. When a separate account is maintained
in connection with a reverse repurchase agreement, the securities deposited in
the separate account are valued daily at market for the purpose of determining
the adequacy of the securities in the account. If the market value of such
securities declines, additional cash or securities are placed in the account
daily to maintain the market value of the account equal to the amount of the
reverse repurchase agreement obligation.
Share Valuation - The net asset value per share is calculated daily by
dividing the total value of each Fund's investments and other assets, less
liabilities, by the total number of shares outstanding.
Investment Income and Distributions to Shareholders - Interest income is
accrued as earned. Dividend income is recorded on the ex-dividend date.
Distributions to shareholders arising from net investment income for Bartlett
Fixed Income Fund, Bartlett Cash Reserves Fund and Bartlett Short Term Bond Fund
are declared daily and paid to shareholders monthly. Distributions to
shareholders from net investment income for Bartlett Basic Value Fund and
Bartlett Value International Fund are declared and paid quarterly and are
recorded on the ex-dividend date. Net realized capital gains, if any, are
distributed to shareholders at least once a year.
Security Transactions - Security transactions are accounted for on a trade
date basis, which is the date the order to buy or sell is executed. Securities
sold are valued on a specific identification basis.
36
<PAGE> 92
As of March 31, 1995
Securities Purchased on a When-Issued Basis - Securities purchased on a
when-issued or delayed delivery basis may be settled a month or more after the
transaction date. Such securities are subject to market fluctuation during this
period. In the event that the seller fails to deliver the securities, a Fund
could experience a loss to the extent of any appreciation, or a gain to the
extent of any depreciation, in the price of the securities. A Fund will
maintain, in a segregated account with its custodian, cash or U.S. government
securities having an aggregate value at least equal to the amount of such
purchase commitments.
Federal Income Taxes - It is each Fund's policy to comply with the special
provisions of the Internal Revenue Code available to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies,
and distributes at least 90% of its taxable net income, the Fund (but not its
shareholders) will be relieved of federal income tax on the income distributed.
Accordingly, no provision for income taxes is made.
In order to avoid imposition of the excise tax created by the Tax Reform
Act of 1986, as amended by the Revenue Act of 1987, it is each Fund's intention
to declare as dividends in each calendar year at least 98% of its net investment
income (earned during the calendar year) and 98% of its net realized capital
gains (earned during the twelve months ended October 31 of the calendar year)
plus undistributed amounts from prior years. Subsequent to October 31, 1994, the
Bartlett Value International Fund recognized net capital losses of $253,272
which, for tax purposes, have been deferred to fiscal 1996 and can be used to
offset future capital gains.
Capital loss carryovers for tax purposes as of March 31, 1995 are as
follows: Bartlett Cash Reserves Fund $96,522, Bartlett Fixed Income Fund
$4,047,747 and Bartlett Short Term Bond Fund $510,375. Such carryovers expire
over varying periods through March 31, 2003. The following amounts are based
upon cost for both financial reporting and federal income tax purposes as of
March 31, 1995:
<TABLE>
<CAPTION>
BARTLETT
BARTLETT BARTLETT BARTLETT SHORT BARTLETT
VALUE BASIC FIXED TERM CASH
INTERNATIONAL VALUE INCOME BOND RESERVES
FUND FUND FUND FUND FUND
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Unrealized
appreciation $6,560,827 $20,568,433 $634,642 $78,631 $1,177
Unrealized
depreciation (2,900,196) (2,394,077) (1,178,802) (313,582) (1,782)
- -----------------------------------------------------------------------------------
Net unrealized
appreciation
(depreciation) $3,660,631 $18,174,356 $(544,160) $(234,951) $(605)
===================================================================================
Federal income
tax cost of
investments $55,012,859 $86,169,609 $90,448,152 $19,763,448 $88,183,678
===================================================================================
</TABLE>
2. Investment Transactions
Investment transactions (excluding short-term securities) are as follows
for the year ended March 31, 1995:
<TABLE>
<CAPTION>
BARTLETT
BARTLETT BARTLETT BARTLETT SHORT BARTLETT
VALUE BASIC FIXED TERM CASH
INTERNATIONAL VALUE INCOME BOND RESERVES
FUND FUND FUND FUND FUND
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Purchases of
investment
securities $21,323,235 $23,708,244 $115,838,735 $32,618,920 $1,969,688
===================================================================================
Proceeds
from sales
and maturities
of investment
securities $12,386,134 $31,145,456 $134,547,439 $33,833,833 $12,877,633
===================================================================================
</TABLE>
Information regarding borrowings by the Bartlett Fixed Income Fund under reverse
repurchase agreements during the year ended March 31, 1995 is as follows:
<TABLE>
<S> <C>
Balance outstanding
at March 31, 1995 $ --
Maximum amount outstanding
during the year $11,765,000
Average amount outstanding
during the year $ 255,000
Weighted average interest rate
during the year 4.73%
</TABLE>
The average amount outstanding during the year was calculated by aggregating
borrowings at the end of each day and dividing that sum by the number of days in
the year ended March 31, 1995. The weighted average interest rate during the
year was calculated by dividing the interest on reverse repurchase agreements
for the year by the average amount of borrowings outstanding during the year.
3. Transactions with Affiliates and Related Parties
The Chairman of the Board, President, Secretary, Treasurer, Assistant
Treasurer and Vice-Presidents of the Trusts are shareholders or employees of the
Advisor, registered investment advisor to the Trusts. Bartlett Capital Trust's
and Bartlett Management Trust's investments are managed by the Advisor under the
terms of Management Agreements. Under the Management Agreements, the Advisor
pays all of the expenses of each Fund except brokerage, taxes, interest and
extraordinary expenses. As compensation for investment advisory services and
agreement to pay the above Fund
37
<PAGE> 93
=======================================
NOTES TO FINANCIAL STATEMENTS
=======================================
expenses, each Fund pays the Advisor a fee computed and accrued daily and paid
monthly. The fee for Bartlett Basic Value Fund and Bartlett Fixed Income Fund is
computed at an annual rate of 2% of the average daily net assets of Bartlett
Basic Value Fund and Bartlett Fixed Income Fund up to and including $10,000,000,
1.50% of such assets from $10,000,000 up to and including $30,000,000 and 1% of
such assets in excess of $30,000,000. The fee for Bartlett Basic Value Fund is
determined by applying the above rates to its average daily net assets, and the
remainder of the fee is allocated to Bartlett Fixed Income Fund. The fee for
Bartlett Cash Reserves Fund is computed at an annual rate of .78% of the average
daily net assets of Bartlett Cash Reserves Fund up to and including $500,000,000
and .75% of such assets in excess of $500,000,000. The fee for Bartlett Value
International Fund is computed at an annual rate of 2% of the average daily net
assets of Bartlett Value International Fund up to and including $20,000,000 and
1.75% of such assets from $20,000,000 up to and including $200,000,000 and 1.25%
of such assets in excess of $200,000,000. The fee for Bartlett Short Term Bond
Fund is computed at an annual rate of .85% of the average daily net assets of
Bartlett Short Term Bond Fund. The Advisor earned commissions as broker on
trades of portfolio securities in the following amounts for the year ended March
31, 1995: Bartlett Basic Value Fund $900.
States in which shares of each Fund are offered may impose an expense
limitation based upon net assets. The Management Agreements between Bartlett
Capital Trust and Bartlett Management Trust and the Advisor allow for the
accrual and payment of the investment advisory services expenses not to exceed
the lowest of the applicable expense limitations imposed.
4. Fund Share Transactions
Proceeds and payments on shares of the Funds as shown in the Statements of
Changes in Net Assets are the result of the following share transactions:
<TABLE>
<CAPTION>
BARTLETT BARTLETT BARTLETT
VALUE BASIC FIXED
INTERNATIONAL VALUE INCOME
FUND FUND FUND
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
3/31/95 3/31/94 3/31/95 3/31/94 3/31/95 3/31/94
===============================================================================================
<S> <C> <C> <C> <C> <C> <C>
Shares sold 3,417,760 1,723,622 5,942,584 5,951,160 3,365,364 5,342,974
Shares issued in
reinvestment of
distributions 217,711 14,206 552,366 158,853 492,992 652,110
- -----------------------------------------------------------------------------------------------
3,635,471 1,737,828 6,494,950 6,110,013 3,858,356 5,995,084
Less shares
redeemed (2,663,521) (691,204) (6,153,807) (6,791,433) (5,556,676) (7,807,298)
- -----------------------------------------------------------------------------------------------
Net increase
(decrease)
in shares
outstanding 971,950 1,046,624 341,143 (681,420) (1,698,320) (1,812,214)
===============================================================================================
</TABLE>
<TABLE>
<CAPTION>
BARTLETT
SHORT BARTLETT
TERM CASH
BOND RESERVES
FUND FUND
YEAR PERIOD YEAR YEAR
ENDED ENDED ENDED ENDED
3/31/95 3/31/94(a) 3/31/95 3/31/94
==========================================================================
<S> <C> <C> <C> <C>
Shares sold 3,502,434 2,428,925 367,680,400 378,988,776
Shares issued in
reinvestment of
distributions 85,957 8,279 3,115,274 1,752,947
- --------------------------------------------------------------------------
3,588,391 2,437,204 370,795,674 380,741,723
Less shares
redeemed (3,787,573) (194,752) (358,112,926) (369,003,477)
- --------------------------------------------------------------------------
Net increase
(decrease)
in shares
outstanding (199,182) 2,242,452 12,682,748 11,738,246
==========================================================================
</TABLE>
(a) From the start of business (February 4, 1994) through March 31, 1994.
38
<PAGE> 94
========================================
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
========================================
To the Shareholders and Boards of Trustees of the
Bartlett Capital Trust and the Bartlett Management Trust:
We have audited the accompanying statements of assets and liabilities of the
Bartlett Value International Fund, Bartlett Basic Value Fund, Bartlett Fixed
Income Fund and Bartlett Short Term Bond Fund of the Bartlett Capital Trust (a
Massachusetts business trust) and the Bartlett Cash Reserves Fund of the
Bartlett Management Trust (an Ohio business trust), including the portfolios of
investments, as of March 31, 1995, and the related statements of operations, the
statements of changes in net assets, and the financial highlights for the
periods indicated thereon. These financial statements and financial highlights
are the responsibility of the Trusts' 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 audits 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 securities owned as of March
31, 1995, by correspondence with the custodians and brokers. 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, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Bartlett Value International Fund, Bartlett Basic Value Fund, Bartlett Fixed
Income Fund and Bartlett Short Term Bond Fund of the Bartlett Capital Trust and
the Bartlett Cash Reserves Fund of the Bartlett Management Trust as of March 31,
1995, the results of their operations, the changes in their net assets, and the
financial highlights for the periods indicated thereon in conformity with
generally accepted accounting principles.
Cincinnati, Ohio, ARTHUR ANDERSEN LLP
April 25, 1995
39
<PAGE> 95
BARTLETT MANAGEMENT TRUST
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part A:
Financial Highlights for Bartlett Basic Value
Fund, Bartlett Fixed Income Fund, Bartlett
Value International Fund, Bartlett Short Term
Bond Fund and Bartlett Cash Reserves Fund
Financial Statements included in Parts B:
Portfolio of Investments, March 31, 1995.
Statements of Assets and Liabilities, March
31, 1995.
Statements of Operations for the year ended
March 31, 1995
Statements of Changes in Net Assets for the
years ended March 31, 1995 and 1994
Financial Highlights for the years ended
March 31, 1995, 1994, 1993, 1992, 1991 and
1990 for the Bartlett Basic Value Fund and
Bartlett Fixed Income Fund. Financial
Highlights for the years ended March 31,
1995, 1994, 1993, 1992, 1991 and for the
period from October 6, 1989 through March 31,
1990 for the Bartlett Value International
Fund. Financial Highlights for the years
ended March 31, 1995, 1994, 1993, 1992, 1991
and the nine months ended March 31, 1990 for
the Bartlett Cash Reserves Fund. Financial
Highlights for the year ended March 31, 1995
and the period from February 4, 1994 through
March 31, 1994 for the Bartlett Short Term
Bond Fund.
Notes to Financial Statements, March 31, 1995.
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<PAGE> 96
(b) Exhibits:
(1) (i) Copy of Registrant's Agreement and
Declaration of Trust, which was
filed as an Exhibit to Registrant's
Registration Statement, is hereby
incorporated by reference.
(ii) Copy of Amendment Nos. 1 and 2 to
Registrant's Agreement and
Declaration of Trust, which was
filed as an Exhibit to Registrant's
Post-Effective Amendment No. 7, is
hereby incorporated by reference.
(iii) Copy of Amendment No. 2b to
Registrant's Agreement and
Declaration of Trust, which was
filed as an Exhibit to Registrant's
Post-Effective Amendment No. 9, is
hereby incorporated by reference.
(iv) Copies of Amendments Nos. 3 and 4 to
Registrant's Agreement and
Declaration of Trust, which were
filed as an Exhibit to Registrant's
Post-Effective Amendment No. 11, are
hereby incorporated by reference.
(2) Copy of Registrant's By-Laws, which was filed
as an Exhibit to Registrant's Registration
Statement, is hereby incorporated by
reference.
(3) Voting Trust Agreements - None.
(4) Specimen of each Security issued by the
Registrant and of each Security being
registered - None.
(5) Copy of Registrant's Management Agreement
with its Adviser, Bartlett & Co., which was
filed as an Exhibit to Registrant's
Post-Effective Amendment No. 7, is hereby
incorporated by reference.
(6) Underwriting or Distribution Contracts and
Agreements with Principal Underwriters and
Dealers - None.
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<PAGE> 97
(7) Bonus, Profit Sharing, Pension or Similar
Contracts for the benefit of Directors or
Officers - None.
(8) Copy of Registrant's Agreement, including the
Schedule of Remuneration, with the Custodian,
The Provident Bank, is filed herewith.
(9) Other Material Contracts - None.
(10) (i) Opinion and Consent of Brown,
Cummins & Brown Co., L.P.A. which
was filed with the Registrant's Rule
24f-2 Notice for the fiscal year
ended March 31, 1995, is hereby
incorporated by reference.
(ii) Representation Letter and Consent of
Brown, Cummins & Brown Co., L.P.A.
is filed herewith.
(11) Consent of Arthur Andersen LLP is filed
herewith.
(12) Financial Statements Omitted from Item 23 -
None.
(13) Copy of Letter of Initial Shareholder, which
was filed as an Exhibit to Registrant's
Pre-Effective Amendment No. 1 to its
Registration Statement, is hereby
incorporated by reference.
(14) Form of 401(k) Plan Used by Bartlett Mutual
Funds is filed herewith.
(15) 12b-1 Plan and Implementation Agreements -
None.
(16) Schedule of Computation for Each Performance
Quotation, which was filed as an Exhibit to
Registrant's Post-Effective Amendment No. 8,
is hereby incorporated by reference.
(17) (i) Power of Attorney for Registrant and
Certificate with respect thereto are
filed herewith.
(ii) Powers of Attorney for Trustees and
Officers of Registrant are filed
herewith.
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<PAGE> 98
Item 25. Persons Controlled by or Under Common Control with the
Registrant - None
Item 26. Number of Holders of Securities (as of May 15, 1995)
<TABLE>
<CAPTION>
Title of Class Number of Record Holders
-------------- ------------------------
<S> <C>
Bartlett Cash Reserves Fund 1,747
</TABLE>
Item 27. Indemnification
(a) Article VI of the Registrant's Declaration of Trust
provides for indemnification of officers and Trustees
as follows:
Section 6.4 Indemnification of Trustees, Officers,
etc. The Trust shall indemnify each of its Trustees
and officers (including persons who serve at the
Trust's request as directors, officers or trustees of
another organization in which the Trust has any
interest as a shareholder, creditor or otherwise
(hereinafter referred to as a "Covered Person")
against all liabilities, including but not limited to
amounts paid in satisfaction of judgments, in
compromise or as fines and penalties, and expenses,
including reasonable accountants' and counsel fees,
incurred by any Covered Person in connection with the
defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any
court or administrative or legislative body, in which
such Covered Person may be or may have been involved
as a party or otherwise or with which such person may
be or may have been threatened, while in office or
thereafter, by reason of being or having been such a
Trustee or officer, director or trustee, and except
that no Covered Person shall be indemnified against
any liability to the Trust or its Shareholders to
which such Covered Person would otherwise be subject
by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's
office ("disabling conduct"). Anything herein
contained to the contrary notwithstanding, no Covered
Person shall be indemnified for any liability to the
Trust or its Shareholders to which such Covered
Person would otherwise by subject unless (1) a final
decision on the merits is made by a court or other
body before whom the proceeding was brought that the
Covered Person to
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<PAGE> 99
be indemnified was not liable by reason of disabling
conduct or, (2) in the absence of such a decision, a
reasonable determination is made, based upon a review
of the facts, that the Covered Person was not liable
by reason of disabling conduct, by (a) the vote of a
majority of a quorum of Trustees who are neither
"interested persons" of the Company as defined in the
Investment Company Act of 1940 nor parties to the
proceeding ("disinterested, non-party Trustees"), or
(b) an independent legal counsel in a written
opinion.
Section 6.5 Advances of Expenses. The Trust shall
advance attorneys' fees or other expenses incurred by
a Covered Person in defending a proceeding, upon the
undertaking by or on behalf of the Covered Person to
repay the advance unless it is ultimately determined
that such Covered Person is entitled to
indemnification, so long as one of the following
conditions is met: (i) the Covered Person shall
provide security for his undertaking, (ii) the Trust
shall be insured against losses arising by reason of
any lawful advances, or (iii) a majority of a quorum
of the disinterested non-party Trustees of the Trust,
or an independent legal counsel in a written opinion,
shall determine, based on a review of readily
available facts (as opposed to a full trial-type
inquiry), that there is reason to believe that the
Covered Person ultimately will be found entitled to
indemnification.
Section 6.6 Indemnification Not Exclusive, etc.
The right of indemnification provided by this Article
VI shall not be exclusive of or affect any other
rights to which any such Covered Person may be
entitled. As used in this Article VI, "Covered
Person" shall include such person's heirs, executors
and administrators, an "interested Covered Person" is
one against whom the action, suit or other proceeding
in question or another action, suit or similar
grounds is then or has been pending or threatened,
and a "disinterested" person is a person against whom
none of such actions, suits or other proceedings or
another action, suit or other proceeding on the same
or similar grounds is then or has been pending or
threatened. Nothing contained in this article shall
affect any rights to indemnification to which
personnel of the Trust, other than Trustees and
officers, and other persons may be entitled by
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<PAGE> 100
contract or otherwise under law, nor the power of the
Trust to purchase and maintain liability insurance on
behalf of any such person.
The Registrant may not pay for insurance which
protects the Trustees and officers against
liabilities rising from action involving willful
misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of
their offices.
(b) The Registrant maintains a standard mutual fund and
investment advisory professional and directors and
officers liability policy. The policy provides
coverage to the Registrant, its trustees and officers
and its Adviser, among others. Coverage under the
policy includes losses by reason of any act, error,
omission, misstatement, misleading statement, neglect
or breach of duty.
(c) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
trustees, officers and controlling persons of the
Registrant pursuant to the provisions of Ohio law and
the Agreement and Declaration of Trust of the
Registrant or the By-Laws of the Registrant, or
otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission
such indemnification is against public policy as
expressed in the Act and is, therefore,
unenforceable. In the event that a claim for
indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or
paid by a trustee, officer or controlling person of
the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such
trustee, officer or controlling person in connection
with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question
whether such indemnification by it is against public
policy as expressed in the Act and will be governed
by the final adjudication of such issue.
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<PAGE> 101
Item 28. Business and Other Connections of the Investment Adviser
Bartlett & Co. is a registered broker-dealer and a registered
investment adviser. It has provided investment advice to
individuals, corporations, pension and profit sharing plans
and trust accounts since 1898.
The following list sets forth the business and other
connections of the directors and officers of Bartlett & Co.
With the exception of James F. Lummanick, Donna Prieshoff and
Gerald Oaks, the following are all directors of Bartlett & Co.
(1) Susan J. Hickenlooper - Managing Director of Bartlett
& Co., 36 East Fourth Street, Cincinnati, Ohio 45202.
(2) Melvin B. Mellis -
(a) Managing Director of Bartlett & Co., 36 East
Fourth Street, Cincinnati, Ohio 45202.
(b) Director of Bartlett & Co., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(c) President of Bartlett Real Estate, Inc., 36
East Fourth Street, Cincinnati, Ohio 45202.
(d) President of BRE Group, Inc., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(3) James A. Miller -
(a) Managing Director and President of Bartlett &
Co., 36 East Fourth Street, Cincinnati, Ohio
45202.
(b) Chairman of the Board and Director of
Bartlett Real Estate, Inc., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(c) Chairman of the Board of BRE Group, Inc., 36
East Fourth Street, Cincinnati, Ohio 45202.
(d) Vice President of Bartlett Capital Trust, 36
East Fourth Street, Cincinnati, Ohio 45202.
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<PAGE> 102
(4) Gerald L. Oaks -
(a) Treasurer of Bartlett & Co., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(b) Treasurer of Bartlett Real Estate, Inc., 36
East Fourth Street, Cincinnati, Ohio 45202.
(c) Treasurer of BRE Group, Inc., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(5) William C. Stock -
(a) Director of Accounting and MIS of Bartlett &
Co., 36 East Fourth Street, Cincinnati, Ohio
45202.
(b) Secretary of Bartlett Real Estate, Inc., 36
East Fourth Street, Cincinnati, Ohio 45202.
(c) Secretary of BRE Group, Inc., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(6) James B. Reynolds -
(a) Managing Director of Bartlett & Co., 36 East
Fourth Street, Cincinnati, Ohio 45202.
(b) Trustee, Chairman of the Board and Vice
President of Bartlett Management Trust, 36
East Fourth Street, Cincinnati, Ohio 45202.
(c) Trustee and Vice President of Bartlett
Capital Trust, 36 East Fourth Street,
Cincinnati, Ohio 45202.
(7) Dale H. Rabiner -
(a) Managing Director of Bartlett & Co., 36 East
Fourth Street, Cincinnati, Ohio 45202.
(b) Trustee and Vice President of Bartlett
Management Trust, 36 East Fourth Street,
Cincinnati, Ohio 45202.
(c) Chairman of the Board, Trustee and Vice
President of Bartlett Capital Trust, 36 East
Fourth Street, Cincinnati, Ohio 45202.
(8) Michael S. Cambron - Director, Bartlett & Co., 36
East Fourth Street, Cincinnati, Ohio 45202.
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<PAGE> 103
(9) Carol D. Hard -
(a) Director of Mutual Funds of Bartlett & Co.,
36 East Fourth Street, Cincinnati, Ohio 45202.
(b) President of Bartlett Management Trust, 36
East Fourth Street, Cincinnati, Ohio 45202.
(c) President of Bartlett Capital Trust, 36 East
Fourth Street, Cincinnati, Ohio 45202.
(10) James F. Lummanick -
(a) Secretary of Bartlett & Co., 36 East Fourth
Street, Cincinnati, Ohio 45202.
(b) Secretary of Bartlett Capital Trust, 36 East
Fourth Street, Cincinnati, Ohio 45202.
(c) Secretary of Bartlett Management Trust, 36
East Fourth Street, Cincinnati, Ohio 45202.
(d) Prior to November, 1993, he practiced law
with the firm of Frost & Jacobs, Cincinnati,
Ohio.
(11) Madelynn Matlock - Vice President of Bartlett Capital
Trust, 36 East Fourth Street, Cincinnati, Ohio 45202.
(12) Donna Prieshoff -
(a) Director of Operations of Bartlett & Co., 36
East Fourth Street, Cincinnati, Ohio 45202.
(b) Vice President of Bartlett Capital Trust, 36
East Fourth Street, Cincinnati, Ohio 45202.
(c) Vice President of Bartlett Management Trust,
36 East Fourth Street, Cincinnati, Ohio 45202.
Item 29. Principal Underwriters
None.
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<PAGE> 104
Item 30. Location of Accounts and Records
Accounts, books and other documents required to be maintained
by Section 31(a) of the Investment Company Act of 1940 and the
Rules promulgated thereunder will be maintained by the
Registrant and its Transfer Agent.
Item 31. Management Services Not Discussed in Parts A or B
None.
Item 32. Undertakings
(a) Not Applicable.
(b) Not Applicable.
(c) The Registrant hereby undertakes to furnish each
person to whom a prospectus is delivered with a copy
of the Registrant's latest annual report to
shareholders upon request and without charge.
(d) The Registrant undertakes that, within five business
days after receipt of a written application by
shareholders holding in the aggregate at least 1% of
the shares then outstanding or shares then having a
net asset value of $25,000, whichever is less, each
of whom shall have been a shareholder for at least
six months prior to the date of application
(hereinafter the "Petitioning Shareholders"),
requesting to communicate with other shareholders
with a view to obtaining signatures to a request for
a meeting for the purpose of voting upon such removal
of any Trustee of the Registrant, which application
shall be accompanied by a form of communication and
request which such Petitioning Shareholders wish to
transmit, Registrant will:
(i) provide such Petitioning
Shareholders with access to a list of the names and
addresses of all shareholders of the Registrant; or
(ii) inform such Petitioning Shareholders
of the approximate number of shareholders and the
estimated costs of mailing such communication, and to
undertake such mailing promptly after tender by such
Petitioning Shareholders to the Registrant of the
material to be mailed and the reasonable expenses of
such mailing.
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<PAGE> 105
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Cincinnati, State of Ohio, on the 11th day of
July, 1995. ----
- ----
BARTLETT MANAGEMENT TRUST
By /s/ James F. Lummanide
---------------------------------
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
JAMES B. REYNOLDS Chairman of
the Board,
Trustee and Vice President
CAROL D. HARD President
DALE H. RABINER Vice President
and Trustee
THOMAS A. STEELE Principal By: /s/ James F. Lummanide
Accounting ----------------------
Officer and Attorney-in-Fact
Treasurer
LORRENCE T. KELLAR Trustee July 11, 1995
-------
ALAN R. SCHRIBER Trustee
WILLIAM P. SHEEHAN Trustee
GEORGE J. WILE Trustee
PHILIP J. RINGO Trustee
</TABLE>
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<PAGE> 106
EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
24.8 Custody Agreement .......................................
24.10(ii) Representation Letter and Consent of Brown, Cummins &
Brown Co., L.P.A. .......................................
24.11 Consent of Arthur Andersen LLP ..........................
24.14 Form of 401(k) Plan Used by Bartlett Mutual Funds .......
24.24 Power of Attorneys ......................................
</TABLE>
<PAGE> 1
Exhibit 24.8
CUSTODIAN AGREEMENT
AGREEMENT made as of November 21, 1994, between BARTLETT MANAGEMENT
TRUST, (the "Trust"), and THE PROVIDENT BANK, an Ohio banking corporation
("Provident");
WHEREAS, the Trust is engaged in the business of investment in certain
types of securities, as more fully described in its Registration Statement on
Form N-1A under the Securities Act of 1933, as amended, including its then
current prospectus and statement of additional information (the "Registration
Statement");
WHEREAS, the Trustees of the Trust have selected Provident to act as
the custodian of the Securities (as subsequently defined) and funds of the Trust
identified on Schedule A hereto, and such schedule may be amended from time to
time, and to perform certain ministerial duties as agent, as more fully set
forth herein;
WHEREAS, Provident is ready and willing to act as custodian and agent
in accordance with the provisions hereof;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
Article 1. Definitions.
1.1 "Book-Entry" or "Book Entry System" shall mean the Federal
Reserve/Treasury book-entry system for United States and federal agency
securities as provided in Subpart O of Treasury Circular No. 300, 31 CFR 306,
Subpart B of 31 CFR Part 350, and the book-entry regulations of federal agencies
substantially in the form of Subpart O, and its successor or successors.
1.2 "Broker Account" shall mean a segregated account, in the name of a
broker, dealer or futures commission merchant or in the name of the Trust for
the benefit of a broker, dealer or futures commission merchant, as the case may
be, separate and distinct from the Trust's custody account, in which certain
securities and/or cash of the Trust shall be deposited and held by Provident for
the benefit of a broker, dealer or futures commission merchant in connection
with the purchase or sale of Financial Futures Contract.
1.3 "Financial Futures Contract" shall mean a contractual commitment to
buy or sell Securities during a specified month at an agreed-upon price, issued
by or pursuant to the regulations of a commodities exchange regulated under the
Commodities Futures Trading Act.
1.4 "Option" shall mean any exchange traded put or call option on
Securities (as defined below).
<PAGE> 2
1.5 (a) "Proper Instruction" shall mean a writing signed or initialled
by one or more persons as the Trustees shall have from time to time authorized,
and, to the extent and for the purposes authorized by the Trustees of the Trust.
Each such writing shall set forth the specific transaction or type of
transaction involved in a manner customarily used in the industry. Oral
instructions confirmed in writing within twenty-four (24) hours by persons
authorized to do so will be considered Proper Instructions if Provident
reasonably believes them to have been given by persons authorized to give such
instructions with respect to the transaction involved. Upon receipt of a
certificate of the Secretary of the Trust as to the authorization by the
Trustees of the Trust accompanied by a detailed description of procedures
approved by the Trustees, Proper Instructions may include communications
effected directly between electro-mechanical or electronic devices provided that
such procedures afford adequate safeguards for the Trust's assets. In performing
its duties generally, and more particularly in connection with the purchase,
sale and exchange of securities made by or for the Trust, Provident may take
cognizance of the provisions of the Trust's Declaration of Trust, By-Laws and
Registration Statement; however, except as otherwise expressly provided herein,
it may assume unless and until notified in writing to the contrary that
instructions purporting to be proper instructions received by it are not in
conflict with or in any way contrary to any provisions of the Trust's
Declaration of Trust, By-Laws, or Registration Statements.
1.6 "Securities" shall mean stocks, bonds, debentures, notes, evidence
of indebtedness, evidences of interest; warrants, Options and Financial Futures
Contracts and other securities, irrespective of their form, the name by which
they may be described, or the character or form of the entities by which they
are issued or created.
1.7 "Securities Depository" shall mean a clearing agency that is
registered under Section 17A of the Securities Exchange Act of 1934 and that
acts as a securities depository as that term is defined by Rule 17f-4(a) under
the Investment Company act of 1940.
1.8 "Shares" shall mean the shares of beneficial interest of the Trust
issued by the Trust.
Article 2. Appointment and Property to be Held in Custody
2.1 The Trust hereby appoints Provident as its custodian and agent
subject to the provisions of this Agreement. The Trust agrees to deliver to
Provident all Securities and cash owned by it, and all payments of income,
payments of principal and capital distributions received by it with respect to
all Securities owned by the Trust from time to time, and the cash consideration
received by it for such Shares of the Trust as may be issued or sold from time
to time.
2.2 The Trust will deposit with Provident properly certified or
authenticated copies of its Declaration of Trust and By-Laws, and all amendments
thereto, its current prospectus and statement of additional information, as from
time to time amended, and such resolutions, votes, or other proceedings of the
Trust as may be necessary for or
2
<PAGE> 3
convenient to Provident in the performance of its duties.
Article 3. Duties of Provident with Respect to Property of the Trust Held
in Custody.
3.1 Safekeeping. Provident shall hold and physically segregate for the
account of the Trust all non-cash property and Securities other than Securities
that are maintained pursuant to Section 3.13, and shall maintain records of all
receipts, deliveries and locations of such Securities, together with a current
inventory thereof, and shall conduct periodic physical inspections (including
sampling counts and four quarterly complete physical accounts per year to be
conducted and certified to the Trust by a Bank officer of Provident) of
certificates representing bonds and other Securities held by it under this
Agreement in such manner as Provident shall determine from time to time to be
advisable in order to verify the accuracy of such inventory. With respect to
Securities held by any agent appointed pursuant to Section 3.11, and with
respect to Securities or cash held by any Sub- Custodian employed pursuant to
Section 3.12, Provident may rely upon certificates from such agent as to the
holdings of such Sub- Custodian, it being understood that Provident must perform
account reconciliations with such agents and Sub-Custodians no less frequently
than quarterly, and that reliance upon such certificates in no way relieves
Provident of its responsibilities under this Agreement.
Provident will promptly report to the Trust the results of such
inspections and certifications, indicating any shortages or discrepancies
uncovered thereby, and take appropriate action to remedy such shortages or
discrepancies.
3.2 Delivery of Securities. Provident shall release and deliver
Securities owned by the Trust that are either held by Provident or are in a
Securities System account (as defined in Section 3.13) of Provident, and only
upon receipt of Proper Instructions (which may be continuing instruction when
deemed appropriate by the parties) and only in the following cases:
(a) upon sale of such Securities for the account of the Trust and
receipt of payment thereof;
(b) upon the receipt of payment in connection with any repurchase
agreement related to such Securities entered into by the Trust,
and prior to any receipt of confirmation of the repurchase
agreement if Provident in its sole discretion deems it
appropriate;
(c) in the case of a sale effected through a Securities System, in
accordance with the provisions of Section 3.13 hereof;
(d) to the depository agent in connection with tender or other
similar offers for portfolio Securities of the Trust;
(e) to the issuer thereof or its agent when such Securities are
called, redeemed, retired or otherwise become payable; provided
that, in any such case, the cash or other
3
<PAGE> 4
consideration is to be delivered to Provident;
(f) to the issuer thereof, or its agent, for transfer into the name
of the Trust or into the name of any nominee or nominees of
Provident or into the name or nominee name of any agent
appointed pursuant to Section 3.11 or into the name or nominee
name of any sub-custodian appointed pursuant to Section 3.12;
or for exchange for a different number of bonds, certificates
or other evidence representing the same aggregate face amount
or number of units; provided that, in any such case, the new
Securities are to be delivered to Provident;
(g) for exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment
of the Securities, or pursuant to provisions for conversion
contained in such Securities, or pursuant to any deposit
agreement, provided that, in any such case, the new Securities
and cash, if any, are to be delivered to Provident;
(h) in the case of warrants, rights or similar Securities, the
surrender thereof in the exercise of such warrants, rights, or
similar Securities or the surrender of interim receipts or
temporary Securities for definitive Securities; provided that,
in any such case, the new Securities and cash, if any, are to
be delivered to Provident;
(i) for delivery in connection with any loans of Securities made by
the Trust, but only against receipt of adequate collateral as
determined by the Trust, which may be in the form of cash or
obligations issued by the United States government, its
agencies or instrumentalities;
(j) for delivery as security in connection with any borrowings by
the Trust requiring a pledge of assets by the Trust, but only
against receipt of amounts borrowed;
(k) upon receipt of instructions from the Transfer Agent, for
delivery to such Transfer Agent or to the holders of Shares in
connection with distributions in kind, as may be described from
time to time in the Trust's currently effective prospectus, in
satisfaction of requests by holders of Shares for repurchase or
redemption;
(l) in the case of Options for the purchase or sale of Securities,
upon the exercise of any put Option by the Trust or sale of an
Option by the Trust and receipt of payment thereof;
(m) for any other proper purpose, upon receipt of Proper
Instructions specifying the Securities to be delivered and
naming the person or persons to whom delivery of such
Securities shall be made. Provident shall have no
responsibility to determine whether said activities are a
4
<PAGE> 5
proper purpose of the Trust.
3.3 Liability for Delivery of Securities in Violation of Section 3.2.
Notwithstanding anything to the contrary in this Agreement, in any and every
case where Securities owned by the Trust are released and delivered by Provident
in violation of Section 3.2, Provident shall be liable to the Trust in the event
any loss results to the Trust from the failure of Provident to comply with the
provisions of Section 3.2.
3.4 Registration of Securities. Securities held by Provident pursuant
to this Agreement (other than bearer Securities) shall be registered (a) in the
name of the Trust, (b) in the name of any nominee of the Trust or of any nominee
of Provident (which nominee shall be assigned exclusively to the Trust), (c) in
the name or nominee name of any agent appointed pursuant to Section 3.11, or (d)
in the name or nominee name of any sub-custodian appointed pursuant to Section
3.12. All Securities accepted by Provident on behalf of the Trust under the
terms of this Agreement shall be in "street name" or other good delivery form.
3.5 Bank Accounts. Provident shall retain all cash of the Trust, other
than cash maintained by the Trust in a checking account established and used in
accordance with Rule 17f-3 under the Investment Company Act of 1940, in the
banking department of Provident in a separate account or accounts in the name of
the Trust, subject only to draft or order by Provident acting pursuant to the
terms of this Agreement. If and when authorized by Proper Instructions in
accordance with a vote of the majority of the Board of Trustees of the Trust,
Provident may open and maintain an additional account or accounts in such other
bank or trust companies (which are qualified to act as a custodian under the
Investment Company Act of 1940) as may be designated by such instructions, such
account or accounts, however, to be in the name of Provident in its capacity as
Custodian and subject only to its draft or order in accordance with the terms of
this Agreement. If requested by the Trust, Provident shall furnish the Trust
with monthly statements of the Trust's accounts.
3.6 Payments for Shares. Provident shall receive as transfer agent for
the Trust, and it shall receive from the distributor for the Trust shares, or
from the Trust, and deposit into the Trust's accounts such payments as are
received for shares of the Trust issued or sold from time to time by the Trust.
3.7 Collections. Unless otherwise instructed by receipt of Proper
Instructions, and to the extent that Provident should reasonably be cognizant of
same in the exercise of due care, Provident shall collect, receive and deposit
in a bank account or accounts maintained pursuant to Section 3.5 all income and
other payments with respect to the Securities held hereunder, and to execute
ownership and other certificates and affidavits for all Federal and State tax
purposes in connection with the collection of bond and note coupons, and to do
all other things necessary or proper in connection with the collection of such
income, and without waiving the generality of the foregoing, to:
5
<PAGE> 6
(1) present for payment on the date of payment all coupons and
other income items requiring presentation;
(2) present for payment all Securities which may mature or be
called, redeemed, retired or otherwise become payable on the
date such Securities become payable;
(3) endorse and deposit for collection, in the name of the Trust,
checks, drafts or other negotiable instruments on the same day
as received.
In any case in which Provident does not receive any such due and unpaid income
within a reasonable time after it has made demands for the same as is customary
in the industry (which demands shall commence within a reasonable period of
time), it shall notify the Trust in writing, including copies of all demand
letters, if any, any written responses thereto and memoranda of all oral
responses thereto and to telephonic demands, and await Proper Instructions.
Provident shall not be obliged to take legal action for collection unless and
until reasonably indemnified to its satisfaction. All income and other payments
with respect to the Securities held hereunder shall be credited to the Trust's
appropriate investment account no later than one day after such income or other
payment is due from the obligor of such Security, whether or not such payments
have been collected by Provident, except where Provident promptly notifies the
Trust at the time when Provident obtains knowledge or reasonably should have
known prior to such time of the occurrence, of a failure or default on the
payment of the obligor. Provident shall notify the Trust as soon as reasonably
practicable whenever income due on Securities is not received by Provident in
due course.
3.8 Payment of Trust Moneys. Upon receipt of Proper Instructions, which
may be continuing instructions when deemed appropriate by the parties, Provident
shall pay out moneys of the Trust in the following cases only:
(a) upon the purchase of Securities for the account of the Trust
but only: (i) against the delivery of such Securities to
Provident (or any bank, banking firm or trust company doing
business in the United States or abroad which is qualified
under the Investment Company Act of 1940, as amended, to act as
a custodian and has been designated by Provident as its agent
for this purpose) registered in the name of the Trust or in the
name of a nominee of Provident referred to in Section 3.4
hereof or in proper form for transfer; (ii) in the case of a
purchase effected through a Securities System, in accordance
with the conditions set forth in Section 3.13 hereof; or (iii)
in the case of repurchase agreements entered into between the
Trust and either Provident or another party, (1) against
delivery of the Securities either in certificate form or
through an entry crediting Provident's custodial account at the
Federal Reserve Bank with such Securities; (2) against delivery
of a safekeeping receipt from a Securities depository
evidencing purchase by the Trust of securities owned by
Provident or another party,
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<PAGE> 7
and prior to any receipt of confirmation of the repurchase
agreement if Provident in its sole discretion deems it
appropriate or (3) pursuant to such other procedures enumerated
in written repurchase agreements entered into by the Trust.
(b) in connection with conversion, exchange or surrender of
Securities owned by the fund as set forth in Section 3.2
hereof;
(c) for the payment of any expense or liability incurred by the
Trust, including but not limited to the following payments for
the account of the Trust: interest, taxes, management,
accounting, transfer agent and legal fees, and operating
expenses of the Trust whether or not such expenses are to be in
whole or part capitalized or treated as deferred expenses;
(d) for the payment of any dividends declared pursuant to the
Trust's Declaration of Trust, By-Laws and Registration
Statement.
(e) in the case of Options, (1) the premium for the purchase of an
Option shall be payable upon receipt of Proper Instructions and
the oral affirmation of the purchase of such Options, given by
the clearing member (in the case of Options Clearing
Corporation traded options) or by the broker and may be made in
advance of receipt of a clearing member's confirmation or
broker's confirmation confirming purchase of an Option by the
Trust, and (2) the payment to a clearing member or broker upon
the exercise of a call Option by the Trust shall be made upon
receipt of the Securities underlying the call Option exercised
by the Trust;
(f) in the case of Financial Futures Contracts, (1) payments for
Financial Futures Contracts, including payments of initial
margin, shall be payable into a Broker Account upon receipt of
Proper Instructions and the oral affirmation of the purchase or
sale of the Financial Futures Contract given by the broker and
may be made in advance of any receipt of a broker's
confirmation confirming the purchase or sale of the Financial
Futures contract, (2) payments of variation margin shall be
payable upon receipt of proper instructions, and (3) payments
in settlement of Financial Futures Contracts shall be payable
into a Broker Account upon receipt of Proper Instructions and
the oral affirmation of the settlement of the Financial Futures
Contract and may be made in advance of receipt of a broker's
confirmation confirming settlement of the Financial Futures
Contract.
(g) upon receipt of Proper Instructions, for any other purpose
which the Trust declares is a proper Trust purpose. Provident
shall have no responsibility to determine whether
7
<PAGE> 8
said activities are a proper purpose of the Trust.
3.9 Liability for Payment in Advance of Receipt of Securities
Purchased. Notwithstanding anything to the contrary in this agreement, in any
and every case where payment for purchase of Securities for the account of the
Trust is made by Provident in violation of Section 3.8 and in the absence of
specific written instructions from the Trust, Provident shall be liable to the
Trust in the event any loss results to the Trust from the failure of Provident
to comply with the provisions of Section 3.7. In every and any case of a
purchase of Securities for the account of the Trust where payment is made by
Provident in advance of receipt of the Securities purchased, Provident shall be
absolutely liable to the Trust for such Securities to the same extent as if the
Securities had been received by Provident.
3.10 Failed Transactions. If, on the day a purchase transaction is to
be effected, Provident is unable to obtain custody and control of any security
intended to be purchased by the Trust, Provident shall advise the Trust of such
failure and shall assist the Trust in obtaining credits in favor of the Trust
based upon any Trust credit balances resulting from such incompleted
transactions. Provident shall also assist the Trust in collecting any payments
of interest, dividends or penalties arising from the failed transaction.
3.11 Appointment of Agents. Provident, may at any time or times appoint
(and may at any time remove) any other bank, trust company or reasonable
commercial agent, qualified to act as Custodian under the Investment Company Act
of 1940, as its agent to carry out such of the provisions of this Agreement as
Provident may from time to time direct, provided, however, that the appointment
of such Agent shall have been approved by the Trustees of the Trust, and that
such appointment shall not relieve Provident of any of its responsibilities
under this Agreement. Each agency relationship shall be established by a written
instrument, copies of which are to be provided promptly to the Trust, which
shall contain, inter alia, the obligation of the agent to segregate and hold
assets of the Trust only in the name of and for the benefit of the Trust.
3.12 Appointment of Sub-Custodians. Provident may from time to time
employ one or more banks and/or trust companies qualified under the Investment
Company Act of 1940 to act as custodian, as Sub-Custodians, provided, however,
that the appointment of such Agent shall have been approved by the Trustees of
the Trust, and that such appointment shall not relieve Provident of any of its
responsibilities under this Agreement. Each Sub-Custodian relationship shall be
established by written instrument, copies of which are to be provided promptly
to the Trust, which shall contain, inter alia, the obligation of the
Sub-Custodian to segregate and hold assets of the Trust only in the name of and
for the benefit of the Trust.
3.13 Deposit of Trust Assets in Securities System. Provident may
deposit and/or maintain Securities owned by the Trust in (a) a Securities
Depository, and (b) the Book-Entry System authorized by the U.S. Department of
Treasury and certain federal agencies (collectively
8
<PAGE> 9
referred to in this Agreement as "Securities System"), all in accordance with
applicable Federal Reserve Board and Securities and Exchange Commission rules
and regulations, if any, and subject to the following provisions:
(a) Provident may keep Securities of the Trust in a Securities
System provided that such Securities are represented in an
account (for purposes of this paragraph "Account") of Provident
in the Securities System that shall not include any assets of
Provident other than assets held as a fiduciary or custodian.
(b) The records of Provident with respect to Securities of the
Trust that are maintained in a Securities System shall identify
those Securities belonging to the Trust.
(c) Provident shall pay for Securities purchased for the account of
the Trust upon (i) receipt of advice from the Securities System
that such Securities have been transferred to the Account, and
(ii) the making of an entry on the records of Provident to
reflect such payment and transfer for the account of the Trust.
Provident shall transfer Securities sold for the account of the
Trust upon (1) receipt of advice from the Securities System
that payment for such Securities has been transferred to the
Account, and (2) the making of an entry on the records of
Provident to reflect such transfer and payment for the account
of the Trust. Copies of all advices from the Securities System
of transfers of Securities for the account of the Trust shall
identify the Trust, be maintained for the Trust by Provident,
and be provided to the Trust at its request. Provident shall
furnish to the Trust copies of daily transaction sheets
reflecting each day's transactions in the Securities System for
the account of the Trust on the next business day.
(d) Provident shall provide the Trust with any report obtained by
Provident on the Securities System's accounting system,
internal accounting control and procedures for safeguarding
Securities deposited in the Securities System.
(e) Provident shall not act under this paragraph 3.13 in the
absence of receipt of an initial certificate of the Secretary
that the Trustees of the Trust have approved the initial use of
a particular Securities System and the receipt of an annual
certificate of the Secretary that the Trustees of the Trust
have reviewed the use by the Trust of such Securities System,
as required in each case by Rule 17f-4 under the Investment
Company Act of 1940, as amended.
(f) Anything to the contrary in this Agreement notwithstanding,
Provident shall be liable to the Trust for any loss or damage
to the Trust resulting from (i) any negligence, misfeasance or
misconduct of Provident or any of its agents or of any of its
employees in using the Securities System or
9
<PAGE> 10
from (ii) failure of Provident or any of its agents or
employees to enforce effectively such rights as it may have
against the Securities System. At the election of the Trust, it
shall be entitled to be subrogated to the rights of Provident
with respect to any claim against the Securities System or any
other person that Provident may have a claim against as a
consequence of any such loss or damage if and to the extent
that the Trust has not been made whole for any such loss or
damage.
3.14 Ownership Certificates for Tax Purposes. Provident shall execute
ownership and other certificates and affidavits for all federal and state tax
purposes in connection with receipt of income or other payments with respect to
Securities of the Trust held by it and in connection with transfers of
Securities.
3.15 Proxies. Provident shall, with respect to the Securities held
hereunder, cause to be promptly executed by the registered holder of such
Securities, if the Securities are registered otherwise than in the name of the
Trust or a nominee of the fund, all proxies, without indication of the manner in
which such proxies are to be voted, and shall promptly deliver to the Trust such
proxies, all proxy soliciting materials and all notices relating to such
Securities.
3.16 Communication Relating to Trust Portfolio Securities. Provident
shall transmit promptly to the Trust all written information (including, without
limitation, pendency of calls and maturities of Securities and expirations of
rights in connection therewith) received by Provident from issuers of the
Securities being held for the Trust. With respect to tender or exchange offers,
Provident shall transmit promptly to the Trust all written information received
by Provident from issuers of the Securities whose tender or exchange is sought
and from the party (or his agents) making the tender or exchange offer. If the
Trust desires to take action with respect to any tender offer, exchange offer or
any other similar transaction, the Trust shall provide Provident with Proper
Instructions on the action the Trust desires Provident to take provided,
however, Provident shall not be liable to the Trust for the failure to take any
such action unless such Proper Instructions are received by Provident at least
one (1) business day prior to the date on which Provident is to take such
action.
3.17 Actions Permitted Without Express Authority. Provident may in its
reasonable discretion, without express authority from the Trust:
(a) surrender Securities in temporary form for Securities in definitive
form;
(b) endorse for collection, in the name of the Trust, checks, drafts
and other negotiable instruments; and
(c) in general, attend to all non-discretionary details in connection
with the sale, exchange, substitution, purchase,
10
<PAGE> 11
transfer and other dealings with the Securities and property of the
Trust except as otherwise directed by the officers of the Trust.
3.18 Evidence of Authority. Provident shall be protected in acting upon
any instructions, notice, request, consent, certificate or other instrument or
paper reasonably believed by it to be genuine and to have been properly executed
by or on behalf of the Trust. Provident may receive and accept a certified copy
of a vote of the Trustees of the Trust as conclusive evidence of (a) the
authority of any person to act in accordance with such vote, or (b) any
determination or action by the Trustees pursuant to the Declaration of Trust and
By-Laws as the case may be, as described in such vote, and such vote may be
considered as in full force and effect until receipt by Provident of notice to
the contrary.
Article 4. Custodian Records.
4.1 Provident shall create, maintain and retain all records relating to
its activities and obligations under this Agreement in such manner as will meet
with obligations of the Trust under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative rules
or procedures which may be applicable to the Trust. All records maintained by
Provident in connection with the performance of its duties under this Agreement
shall be the property of the Trust, shall at all times during the regular
business hours of Provident be open for inspection by duly authorized officers,
employees, attorneys for, auditors employed by, and other agents of the Trust
and, in the event of termination of this Agreement, will be delivered by
Provident to the Trust or to the successor Custodian designated by the Trust.
Provident shall, on a monthly basis, and otherwise when requested by the Trust,
at Provident's cost, supply the Trust with a tabulation of Securities owned by
the Trust and held by Provident.
Article 5. Opinion of Trust's Independent Accountant.
5.1 Provident shall take all reasonable action, as the Trust may from
time to time request, so that the Trust may obtain from year to year favorable
opinions from the Trust's independent accountants with respect to its activities
hereunder in connection with the preparation of reports to the Securities and
Exchange Commission and with respect to any other requirements of such
Commission.
Article 6. Reports to Trust by Independent Public Accountants.
6.1 Provident shall provide the Trust, at such times as the Trust may
reasonably require, with reports of independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
Securities, including Securities deposited and/or maintained in a Securities
System, relating to the services
11
<PAGE> 12
provided by Provident under this Agreement; such reports, shall be of sufficient
scope and in sufficient detail, as may reasonably be required by the Trust, to
provide reasonable assurance that any material inadequacies would be disclosed
by such examination, and, if there are no such inadequacies, shall so state.
Article 7. Compensation of Provident.
7.1 Provident shall be entitled to such reasonable compensation for
its services and expenses as custodian, as agreed upon in writing from time to
time between the Trust and Provident and set forth in Schedule B Addendum
attached to this Agreement.
Article 8. Liability and Indemnification of Provident.
8.1 Provident shall be entitled to receive and act upon advice of
counsel (who may be counsel for the Trust) and shall be without liability for
any action reasonably taken pursuant to such advice, provided that such action
is not in violation of applicable Federal or state laws or regulations.
Provident shall be kept indemnified by the Trust and be without liability for
any action taken or thing done by it or its employees, Sub-Custodians and
agents, in carrying out the terms and provisions of this Agreement in good faith
and without negligence, provided that it shall be liable to the Trust for any
error, omission or other act by it or any of its employees, Sub-Custodian and
agents, including acts of negligence, clerical errors and mechanical failures.
Provident assumes no responsibility or liability for any acts, errors or
omissions that may have occurred prior to Provident serving as custodian for the
Trust, and the Trust agrees to indemnify and hold Provident harmless from all
claims, lawsuits, damages and the like which are attributable to or caused by
any service provider previously engaged by the Trust to perform similar duties
for the Trust as are described herein. In order that the indemnification
provision contained in this Section 8.1 shall apply, however, it is understood
that if in any case the Trust may be asked to indemnify or save Provident
harmless, the Trust shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further understood that
Provident will use all reasonable care to identify and notify the Trust promptly
concerning any situation which presents or appears likely to present the
probability of such a claim for indemnification against the Trust. The Trust
shall have the option to defend Provident against any claim which may be the
subject of this indemnification, and in the event that the Trust so elects it
will so notify Provident, and thereupon the Trust shall take over complete
defense of the claim, and Provident shall in such situation initiate no further
legal or other expenses for which it shall seek indemnification under this
Section 8.1 Provident shall in no case confess any claim or make any compromise
in any case in which the Trust will be asked to indemnify Provident except with
the Trust's written consent.
Article 9. Effective Period; Termination.
9.1 This Agreement shall become effective as of its execution,
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<PAGE> 13
shall continue in full force and effect until termination by either party by an
instrument in writing delivered or mailed, postage prepaid to the other party,
such termination to take effect not sooner than sixty (60) days after the date
of such delivery or mailing; provided, that the Trustees may immediately
terminate this Agreement in the event of the appointment of a conservator or
receiver for Provident by the Ohio Superintendent of Banks or upon the happening
of a like event at the direction of an appropriate regulatory agency or court of
competent jurisdiction.
9.2 Upon termination of this Agreement, the Trust shall pay to
Provident such compensation as may be due as of the date of such termination and
shall likewise reimburse Provident for its reasonable costs, expenses and
disbursements in connection with the termination of this Agreement.
Article 10. Successor Custodian.
10.1 If a successor custodian shall be appointed by the Trustees of the
Trust, Provident shall, upon termination of this Agreement, deliver to such
successor custodian at the office of Provident, duly endorsed and in the form
for transfer, all Securities then held by it hereunder, shall transfer to an
account of the successor custodian all the Trust's Securities held in a
Securities System and shall deliver to such successor custodian all funds and
other property held by it, including all books, records, entries, accounts and
statements held by Provident or its agents, and generally shall fully cooperate
with the successor custodian in the transition.
10.2 In the event that no written order designating a successor
custodian shall have been delivered to Provident on or before the date when such
termination shall become effective, then Provident shall have the right to
deliver to a bank or trust company, which is a "bank" as defined in the
Investment Company Act of 1940, of its own selection, having an aggregate
capital, surplus, and undivided profits, as shown by its last published report,
of not less than $5,000,000, all Securities, funds and other properties held by
Provident and all instruments held by Provident relative thereto and all other
property held by it under this Agreement and to transfer to an account of such
successor custodian all of the Trust's Securities held in any Securities System.
Thereafter, such bank or trust company shall be the successor of Provident under
this Agreement.
10.3 In the event that Securities, funds and other properties remain in
the possession of Provident after the date of termination hereof due to the
failure of the Trust to appoint a successor custodian, and Provident retains
possession of such Securities, funds and other properties of the Trust, the
provisions of this Agreement shall remain in full force and effect.
Article 11. Interpretive and Additional Provisions.
11.1 In connection with the operation of this Agreement,
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<PAGE> 14
Provident and the Trust may from time to time agree on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be consistent with the general tenor of this Agreement. Any
such interpretive or additional provision shall be in a writing signed by both
parties and shall be annexed hereto, provided that no such interpretive or
additional provisions shall contravene any applicable federal or state
regulations or any provision of the Declaration of Trust and By-Laws of the
Trust. No interpretive or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Agreement.
Article 12. Ohio Law to Apply.
12.1 This Agreement shall be construed in accordance with the laws of
Ohio.
Article 13. Limitation of Liability of the Trustees and Shareholders.
13.1 It is expressly agreed to that the obligations of the Trust
hereunder shall not be binding upon any of the Trustees, shareholders, nominees,
officers, agents, or employees of the Trust, personally, but bind only the trust
property of the Trust, as provided in the Declaration of Trust of the Trust. The
execution and delivery of this Agreement have been authorized by the Trustees of
the Trust and signed by an authorized officer of the Trust, acting as such, and
neither such authorization by such Trustees nor such execution and delivery by
such officer shall be deemed to have been made by any of them individually or to
impose any liability on any of them personally, but shall bind only the trust
property of the Trust as provided in its Declaration of Trust.
Article 14. Entire Agreement and Amendments.
14.1 This Agreement supersedes and terminates, as of the date hereof,
all prior contracts between the Trust and Provident relating to the custody of
the Trust's assets. Provident and the Trust acknowledge that this Agreement and
the Compensation Addendum attached constitute the entire agreement between them
with respect to the subject matter hereof, and that any and all prior
discussions, negotiations, commitments, or understanding relating to the subject
matter of this Agreement or the Compensation Addendum are hereby superseded and
merged herein. The terms and provisions of this Agreement shall not be changed,
modified, amended, waived, or terminated in any respect whatsoever except by a
written instrument executed by Provident and the Trusts.
Article 15. Severability.
15.1 If any of the provisions of this Agreement is held to be illegal,
invalid or unenforceable in any respect, Provident and the
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<PAGE> 15
Trust agree that such term or provision shall be deemed to be modified to the
extent necessary to permit its enforcement to the maximum extent permitted by
applicable law. If any of the provisions of this Agreement is held to be
illegal, invalid or unenforceable in any respect, the remainder of this
Agreement and all other provisions hereof shall not be affected thereby,
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative as of
the 21st day of November, 1994.
BARTLETT MANAGEMENT TRUST
BY: /S/ DALE H. RABINER
--------------------------------
ITS: PRESIDENT
--------------------------------
THE PROVIDENT BANK
BY: DANIEL F. ECKSTEIN
--------------------------------
ITS: VP AND TRUST OFFICER
--------------------------------
15
<PAGE> 16
SHAREHOLDER COMMUNICATION ACT
SEC RULE 14(B)-2
CONSENT FORM
In order to permit companies that issue securities to communicate directly with
the shareholders who vote those securities, the Securities and Exchange
Commission has adopted a rule, known as Rule 14b-2. This rule requires us to ask
you whether you authorize us to provide your name, address, and share position
to companies whose stock you own, if they should request such information. If
you tell us "no," we will not provide this information to requesting companies.
If you tell us "yes," we will provide the information to requesting companies.
Your "yes" or "no" response will apply to all securities we hold for you.
For your protection, the rule prohibits the requesting company from using your
name and address for any purpose other than corporate communications.
Would you please check one of the alternatives below, sign and date this
letter, and return it to us.
Thank you very much for helping us to comply with this Securities and Exchange
Commission rule.
Sincerely,
The Provident Bank
X YES. You are authorized to release my name, address, and
- ---------
share positions.
NO. You are not authorized to release my name, address,
- ---------
and share positions.
/s/ Dale H. Rabiner November 21, 1994
- ------------------------------- -----------------
Dale H. Rabiner, President, Bartlett Management Trust
SIGNATURE DATE
ACCOUNT NAME: BARTLETT CASH RESERVES FUND ACCOUNT#: 140000001
--------------------------- ---------
16
<PAGE> 17
SCHEDULE A
TO THE CUSTODIAN AGREEMENT
BETWEEN
BARTLETT MANAGEMENT TRUST
AND
THE PROVIDENT BANK
NAME OF FUNDS
Bartlett Cash Reserves Fund
BARTLETT MANAGEMENT TRUST
BY: /S/ DALE H. RABINER
----------------------------
DALE H. RABINER, PRESIDENT
DATE: November 21, 1994
----------------------------
THE PROVIDENT BANK
BY: DANIEL F. ECKSTEIN
----------------------------
DATE: 11/21/94
----------------------------
17
<PAGE> 18
SCHEDULE B
TO THE CUSTODIAN AGREEMENT
BETWEEN
BARTLETT MANAGEMENT TRUST
AND
THE PROVIDENT BANK
CUSTODIAN FEES - TRANSACTION BASED
<TABLE>
<S> <C>
ANNUAL BASIC ACCOUNT FEE
Annual fee for account support, $1200.00
service and maintenance. *WAIVED*
ANNUAL MAINTENANCE FEE
Annual fee for security safekeeping, DTC & FED Eligible Issues
transfers, dividend and interest $7.50 PER ISSUE
postings, exchanges, pledge, etc. DTC & FED Ineligible Issues
$12.00 PER ISSUE
DIVIDENDS AND INTEREST ARE CREDITED GNMA & CMO Issues
TO THE FUNDS ACCOUNT ON PAYABLE DATE $36.00 PER ISSUE
UNLESS IN PHYSICAL FORM.
TRANSACTION FEE
Activity Fee includes security DTC & FED Eligible
purchases, sales, maturities, bond $7.50 PER TRANSACTION
calls, redemptions, stock dividend, DTC & FED Ineligible
tender, free deliveries. $18.00 PER TRANSACTION
GNMA & CMO Transactions
$24.00 PER TRANSACTION
GNMA Paydowns
$14.00 PER TRANSACTION
Repurchase Settlements
$7.50 PER TRANSACTION
Options
$30.00 PER TRANSACTION
Euroclear
$25.00 PER TRANSACTION
Futures
$25.00 PER TRANSACTION
ANNUAL ON-LINE INQUIRY FEE
Account Information availability $600.00
on-line whenever needed. On-site *WAIVED*
training. 800-number for on-line
access.
</TABLE>
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<PAGE> 19
<TABLE>
<S> <C>
POSTAGE
Postage charge for trade advices, Pass Thru Charges
statements, check mailing. *WAIVED*
STATEMENTS
Daily and monthly statements. *WAIVED*
SEGREGATED ACCOUNTS
Annual fee to maintain segregated $360.00 per account
accounts at The Provident Bank's *WAIVED*
custodian.
</TABLE>
REPURCHASE AGREEMENTS
PROVIDENT HAS A 2:00 P.M. TIME RESTRICTION. HOWEVER, EXCEPTION PROCESSING IS
PROVIDED FOR BARTLETT, ALLOWING A 4:00 P.M. CUTOFF.
<TABLE>
<S> <C>
WIRE TRANSFER FEE
Wire Transfer Charges $8.00 Per Wire
(Excluding Cash Management Wires) *WAIVED*
</TABLE>
CUSTODIAN FEES - ASSET BASED
The fee shown below is an annual charge, payable monthly, based on average
monthly combined net assets of the Bartlett domestic mutual funds.
ASSET HOLDINGS FEE ON DOMESTIC ASSETS
<TABLE>
<S> <C>
First $100 Million 2.5 Basis Points
Excess 1.5 Basis Points
</TABLE>
BARTLETT MANAGEMENT TRUST
BY: /s/ DALE H. RABINER
---------------------------
Dale H. Rabiner, President
DATE: November 21, 1994
---------------------------
THE PROVIDENT BANK
BY: /s/ DANIEL F. ECKSTEIN
---------------------------
DATE: 11/21/94
---------------------------
19
<PAGE> 1
Exhibit 24.10(ii)
BROWN, CUMMINS & BROWN CO., L.P.A.
ATTORNEYS AND COUNSELORS AT LAW
3500 CAREW TOWER
441 VINE STREET
J.W. BROWN* CINCINNATI, OHIO 45202
JAMES R. CUMMINS TELEPHONE (513) 381-2121
ROBERT S BROWN TELECOPIER (513) 381-2125
DONALD S. MENDELSOHN OF COUNSEL
LYNNE SKILKEN AMY G. APPLEGATE GILBERT BETTMAN
KATHRYN KNUE PRZYWARA
MELANIE S. CORWIN
JEFFREY R. TEETERS
JOANN M. STRASSER
-------
*RETIRED
July 7, 1995
------
Bartlett Management Trust
36 East Fourth Street
Cincinnati, Ohio 45202
Gentlemen:
This letter is in response to your request for a representation letter
in connection with the filing of Post-Effective Amendment No. 15 to the
Registration Statement of Bartlett Management Trust (the "Amendment").
We have assisted in the preparation of and reviewed the Amendment and
based upon the foregoing, we represent that the Amendment does not contain any
disclosures which would render it ineligible to become effective pursuant to
Rule 485(b).
We herewith give you our permission to file this representation letter
with the Securities and Exchange Commission as an exhibit to the Amendment.
Very truly yours,
BROWN, CUMMINS & BROWN CO., L.P.A.
BCB/jh
<PAGE> 1
Exhibit 24.11
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use in this
Post-Effective Amendment No. 15 of our report dated April 25, 1995 and to all
references to our Firm included in or made a part of this Post-Effective
Amendment.
ARTHUR ANDERSEN LLP
Cincinnati, Ohio,
July 7, 1995
--
22
<PAGE> 1
Exhibit 24.14
BUCK CONSULTANTS, INC. DEFINED CONTRIBUTION -PLAN (#01)
The following language shall supersede and replace any plan language to the
contrary:
1) The definition of Compensation contained in Section 1.11 and Statutory
Compensation as contained in Section 1.34, if applicable, shall be
amended by the addition of the following:
"In addition to other applicable limitations set forth in the
Plan, and notwithstanding any other provision of the Plan to
the contrary, for Plan Years beginning on or after January 1,
1994, the annual Compensation of each Employee taken into
account under the Plan shall not exceed the OBRA'93 annual
compensation limit. The OBRA'93 annual compensation limit is
$150,000, as adjusted by the Commissioner for increases in the
cost-of-living in accordance with Section 401(a)(17)(B) of the
Internal Revenue Code. The cost-of-living adjustment in
effect for a calendar year applies to any period, not
exceeding 12 months, over which Compensation is determined
(determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the
OBRA'93 annual compensation limit shall be multiplied by a
fraction, the numerator of which is the number of months in
the determination period, and the denominator of which is 12.
For Plan Years beginning on or after January 1, 1994, any
reference in this Plan to the limitation under Section
401(a)(17) of the Code shall mean the OBRA'93 annual
compensation limit set forth in this provision.
If Compensation for any prior determination period is taken
into account in determining an Employee's benefits accruing in
the current Plan Year, the Compensation for that prior
determination period is subject to the OBRA'93 annual
compensation limit in effect for that prior determination
period. For this purpose, for determination periods beginning
before the first day of the first Plan Year beginning on or
after January 1, 1994, the OBRA'93 annual compensation limit
is $150,000."
2) The following language is added to Section 5.07 and is applicable only
if the plan does not provide for an annuity payment in accordance with
Section 5.11:
"If a distribution is one to which Section 401(a)(11) and 417 of the
Internal Revenue Code does not apply, such distribution may commence
less than 30 days after the notice required under Section
1.411(a)-(11)(c) of the Income Tax Regulations is given, provided
that:
<PAGE> 2
(1) the Plan Administrator clearly informs the
Participant that the Participant has a right to a
period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option), and
(2) the Participant, after receiving the notice,
affirmatively elects a distribution."
<PAGE> 3
BUCK CONSULTANTS, INC.
DEFINED CONTRIBUTION PROTOTYPE PLAN (#01)
<TABLE>
<CAPTION>
=======================================================================
TABLE OF CONTENTS PAGE
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<S> <C>
Introduction 1
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Procedures and General Information 2
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Article 1. Definitions 4
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Article 2. Eligibility and Participation 20
- -----------------------------------------------------------------------
Article 3. Contributions and Allocations 22
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Article 4. Cash or Deferred Arrangement (CODA) 38
- -----------------------------------------------------------------------
Article 5. Benefits 53
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Article 6. Administration of the Plan 71
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Article 7. Management of Funds 77
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Article 8. Top-Heavy Provisions 83
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Article 9. General Provisions 89
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Article 10. Amendment, Merger and Termination 91
=======================================================================
</TABLE>
<PAGE> 4
INTRODUCTION
This Plan and Trust and the Adoption Agreement have been approved as to form by
the Internal Revenue Service (IRS) for corporate and non-corporate Employers.
The Employer adopts the Plan and Trust by completing and signing the Adoption
Agreement. In order to retain prototype status, no changes in the wording of
this Plan and Trust, except the elections by the Employer in the Adoption
Agreement, can be made.
In general, the approval of this Prototype by the IRS does not constitute a
determination as to the qualification of the Plan as adopted by the Employer,
nor as to the exempt status of the related Trust. This determination is made
by the Employer's local District Director of Internal Revenue upon submission
by the Employer of an Application for Determination for Defined Contribution
Plan, IRS Form 5307, with a copy of the executed Adoption Agreement, and such
additional information and documents as the District Director may require.
This Plan and Trust and Adoption Agreement are instruments having significant
legal and tax implications for the Employer. Each Employer must assume the
responsibility for the legal and tax aspects pertaining to its Plan. Neither
Buck Consultants, Inc. (hereinafter referred to as "Buck") nor its
representatives can give any assurance that the Plan as adopted by a given
Employer shall be qualified by the IRS. Accordingly, Buck encourages the
Employer to consult with its legal and tax advisors to the extent considered
necessary.
This Prototype document #01 may be used in conjunction with the following
adoption agreements:
<TABLE>
<CAPTION>
===================================================================
Plan Type IRS Serial # Form #
- -------------------------------------------------------------------
<S> <C> <C>
Non-Standardized Profit D8310525 95361NS-PSI
Sharing
- -------------------------------------------------------------------
Non-Standardized 401(k) D8310524 95361NS(K)I
Savings Plan
===================================================================
</TABLE>
PROCEDURES AND GENERAL INFORMATION
Procedures:
a. The Employer and Trustee(s) should sign enough copies of the Adoption
Agreement for all parties needing a copy. This usually includes one
for the Employer, one for the Trustee,
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<PAGE> 5
one for the Plan Administrator, if other than the Trustee, one for
Buck, and one for the IRS.
b. One copy should be filed with Buck along with other information,
applications, and other documents as required by Buck.
c. The Employer should file the Plan with the IRS (by the due date for
filing corporate tax returns for the year in which the Plan is adopted
or amended) to obtain a Letter of Determination that the Plan, as
established or amended, is qualified. In addition, the Employer must
furnish information, reports, and certain documents as required for
the IRS, the Department of Labor, Participants, and Beneficiaries
receiving any benefits from the Plan.
d. Initial compliance, amendment compliance, and annually recurring
services are available for a fee from Buck upon request provided the
Plan meets Buck's servicing guidelines. Such services performed by
authorization of the Plan Fiduciaries are only of the ministerial and
mechanical type. Buck assumes no fiduciary duties on behalf of the
Plan nor offers any legal advice. Any information given is presented
as information only and not as advice, recommended action, or policy
decisions for the Plan.
General Information:
a. Purpose - This Defined Contribution Prototype Plan and Trust with its
Adoption Agreement constitute an employee pension benefit plan created
hereby for the exclusive benefit of eligible Employees of the
Employer. Prior to satisfaction of all liabilities with respect to
the Participants and their Beneficiaries, no part of the corpus or
income of the Trust shall at any time be used for or diverted to
purposes other than for the exclusive benefit of such Participants or
their Beneficiaries.
It is further the purpose of the Plan to provide benefits in
accordance herewith for those Participants who remain in the employ of
the Employer until their Account(s) is vested or until they reach
Normal Retirement Age, at which time benefits shall be distributed in
accordance herewith. It is further the intent to provide other
benefits as are set forth in the Adoption Agreement.
b. Name of Plan - The name of the Plan shall be the legal name of the
Employer as set forth in the Adoption Agreement followed
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<PAGE> 6
by the name of the plan as set forth in the Adoption Agreement.
c. Approval of Internal Revenue Service - This Plan is contingent upon
and subject to obtaining such initial approval of the District
Director of Internal Revenue as may be necessary to establish
qualification for income tax purposes pursuant to Section 401 of the
Internal Revenue Code of 1986 (Code) and as may be necessary to
qualify for tax exemption under the provisions of Section 501 or other
applicable provisions of the Code. Any modification or amendment of
the Plan may be made if necessary or appropriate to initially qualify
or to maintain qualification of the Plan.
If a final adverse action with respect to initial qualification or
requalification is issued by the Internal Revenue Service, the Plan
shall be treated as an individually designed plan and the Employer
shall no longer participate in this prototype Plan.
Article 1. Definitions
The following words and phrases as used in this Plan and Trust (hereinafter
referred to as `Plan') shall have the meaning set forth in this Article, unless
a different meaning is clearly required by the context. Refer to the same
Section number in the Adoption Agreement as in the Plan for cross-reference
purposes.
1.01 "Accounts" means the Employer Account, the Participant Account, if
any, the Elective Deferral Account, if any, and the Rollover Account,
if any.
(a) "Employer Account" means the account into which shall be
credited the Employer contributions made on a Participant's
behalf pursuant to Section 3.01 and Section 4.02, if
applicable, and investment earnings on those contributions.
(b) Participant Account" means the account into which shall be
credited any after-tax contributions made by a Participant
under the terms of the Plan prior to the date this prototype
is adopted by the Employer and investment earnings on those
contributions. After-tax Participant contributions are not
permitted under the terms of this prototype.
(c) "Elective Deferral Account" means the account into which shall
be credited the Elective Deferral Contributions made on a
Participant's behalf and investment earnings on those
contributions.
(d) "Rollover Account" means the account into which shall be
credited any rollover contributions made by a Participant
pursuant to Section 3.02 of the Plan and investment earnings
on those contributions.
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<PAGE> 7
1.02 "Actual Contribution Percentage" means, with respect to a specified
group of Employees, the average of the ratios, calculated separately
for each Employee in that group, of (a) the sum of any Participant
contributions and contributions made by the Employer pursuant to
Section 3.01 and 4.02 for the Employee's benefit for that Plan Year,
to (b) his Statutory Compensation received during the period the
Employee is a Participant or is eligible to become a Participant. For
Plan Years beginning after 1988, the Actual Contribution Percentage
for each group and the ratio determined for each Employee in the group
shall be calculated to the nearest one-hundredth of 1%.
1.03 "Actual Deferral Percentage" means, with respect to a specified group
of Employees, the average of the ratios, calculated separately for
each Employee in that group, of (a) the amount of Elective Deferral
Contributions made pursuant to Section 4.01 for a Plan Year, whether
or not such Elective Deferral Contributions are returned to the
Participant pursuant to Section 4.01(c), to (b) the Employee's
Statutory Compensation received during the period the Employee is a
Participant or is eligible to become a Participant. For Plan Years
beginning after 1988, the Actual Deferral Percentage for each group
and the ratio determined for each Employee in the group shall be
calculated to the nearest one-hundredth of 1%.
1.04 "Adjustment Factor" means the cost of living adjustment factor
prescribed by the Secretary of the Treasury under Section 415(d) of
the Code for calendar years beginning on or after January 1, 1988, and
applied to such items and in such manner as the Secretary shall
provide.
1.05 "Affiliated Employer" means any employer which is a member of a
controlled group of corporations determined under Section 414(b) of
the Code as modified by Section 415(h), all trades or businesses under
common control as defined in Section 414(c) of the Code as modified by
Section 415(h), or a member of an affiliated service group as defined
in Section 414(m) of the Code and any other entity required to be
aggregated with the Employer pursuant to regulations under Section
414(o) of the Code.
1.06 "Age" means actual attained age.
1.07 "Annuity Starting Date" means the first day of the first period for
which an amount is paid as an annuity or any other form following a
Participant's retirement or other termination of employment.
1.08 "Beneficiary" means any person, persons or entity named by a
Participant by written designation filed with the Plan Administrator
to receive benefits payable in the event of the
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<PAGE> 8
Participant's death. However, if the Participant is married, his
spouse shall be deemed to be the Beneficiary unless or until he elects
another Beneficiary by a written designation filed with the Plan
Administrator. Any such designation shall not be effective without
Spousal Consent. If no such designation is in effect at the time of
death of the Participant, or if no person, persons or entity so
designated shall survive the Participant, the Participant's surviving
spouse, if any, shall be deemed to be the Beneficiary; otherwise the
Beneficiary shall be the estate of the Participant. The designation of
a spouse as Beneficiary shall become null and void in the event of the
divorce of the Participant and such spouse, unless the Participant
makes a beneficiary designation after the final date of such divorce
naming the former spouse as his Beneficiary.
1.09 "Break in Service" means an event affecting forfeitures, which shall
be based on the Hours Method for eligibility purposes and computed
under one of the following methods as elected in the Adoption
Agreement for purposes of vesting:
(a) Hours Method -- a Break in Service shall occur if the Employee
fails to complete more than 500 Hours of Service during any
Plan Year.
(b) Elapsed Time Method -- a Break in Service shall occur as of
the Participant's Severance Date if he is not reemployed by
the Employer or an Affiliated Employer within one year after a
Severance Date. However, if an Employee is absent from work
immediately following a period of active employment,
irrespective of whether the Employee's employment is
terminated, as a result of the Employee's pregnancy, the birth
of the Employee's child, the placement of a child with the
Employee in connection with the adoption of that child by the
Employee or for purposes of caring for that child for a period
beginning immediately following that birth or placement and
that absence from work began on or after the first day of the
Plan Year which began in 1985, a Break in Service shall occur
only if the Employee does not return to work within two years
of his Severance Date.
For purpose of this Plan, the term "Severance Date" means the
earlier of: (i) the date an Employee quits, retires, is
discharged or dies, or (ii) the first anniversary of the date
on which an Employee is first absent from service, with or
without pay, for any reason such as vacation, sickness,
disability, layoff or leave of absence.
A Break in Service shall not occur during an approved leave of
absence or during a period of military service which is
included in the Participant's Vesting Service.
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<PAGE> 9
1.10 "Code" means the Internal Revenue Code of 1986 as amended from time to
time.
1.11 "Compensation" means the cash wages paid to an Employee for services
rendered to the Employer, determined in accordance with the selection
made in the Adoption Agreement. Notwithstanding the foregoing,
Compensation shall be determined prior to any reduction pursuant to a
cash or deferred arrangement as defined in Section 402(h) or pursuant
to a cafeteria plan as described in Section 125 of the Code. However,
for Plan Years beginning after 1988, Compensation for Plan purposes
shall not exceed $200,000 per year. When determining the Compensation
of any Participant who is a Highly Compensated Employee, the family
aggregation rules of Section 414(q)(6) of the Code shall apply;
provided, however, that the term "family" shall include only the
Participant's spouse and lineal descendents who have not attained age
19 before the close of the Plan Year. If, as a result of the
application of the family aggregation rules, the foregoing
Compensation limit is exceeded, then the Compensation to be considered
for Plan purposes shall be prorated among the affected individuals on
the basis of the individuals' Compensation determined prior to the
application of the limitation. However, for the purposes of
determining Compensation up to the Social Security Integration Level,
the foregoing proration shall not apply. For calendar years
commencing on or after January 1, 1990, the $200,000 limitation shall
be multiplied by the Adjustment Factor as provided by the Secretary of
the Treasury.
For any Owner-Employee or Self-Employed Individual covered by the
Plan, "Compensation" means Earned Income which is the net earnings
from self-employment in the trade or business with respect to which
the Plan is established, for which personal services of the individual
are a material income-producing factor. Net earnings shall be
determined without regarding to items not included in gross income and
the deductions allocable to such items. Net earnings are reduced by
contributions by the Employer to a qualified plan to the extent
deductible under Section 404 of the Code. Net earnings shall be
determined with regard to the deduction allowed to the taxpayer by
Section 164(f) of the Code for taxable years beginning after December
31, 1989.
If the period for determining Compensation used in calculating an
Employee's allocation for a determination period is a short Plan Year
(i.e., shorter than 12 months), the annual Compensation limit is an
amount equal to the otherwise applicable annual Compensation limit
multiplied by the fraction, the numerator of which is the number of
months in the short Plan Year, and the denominator of which is 12.
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<PAGE> 10
1.12 "Disability" means total and permanent physical or mental disability,
as evidenced by (a) receipt of a Social Security disability pension,
(b) receipt of disability payments under the Employer's long-term
disability program, or (c) certification by a physician or physicians
chosen by the Participant and satisfactory to the Plan Administrator.
1.13 "Effective Date" means the date as indicated in the Adoption Agreement
as the Effective Date of the Plan. The Effective Date of an amendment
and restatement of the Plan shall also be the date indicated as such
by the Employer in the Adoption Agreement.
1.14 "Elective Deferral Contributions" means all amounts contributed by the
Employer in accordance with an election by the Participant, in lieu of
cash compensation, including contributions made pursuant to a salary
reduction agreement or other deferral mechanism. With respect to any
taxable year, a Participant's Elective Deferral Contributions are the
sum of all Employer contributions made on behalf of such Participant
pursuant to an election to defer under any qualified cash or deferred
arrangement (CODA) as described in Section 401(k) of the Code, any
simplified employee pension cash or deferred arrangement as described
in Section 402(h)(1)(B), any eligible deferred compensation plan under
Section 457, any plan as described under Section 501(c)(18), and any
Employer contributions made on behalf of a Participant for the
purchase of an annuity contract under Section 403(b) pursuant to a
salary reduction agreement.
1.15 "Employee" means any person who is employed by the Employer or an
Affiliated Employer, and who is eligible to participate in the Plan as
indicated in the Adoption Agreement. The term "Employee" may also
include any Leased Employee who is deemed to be an Employee of the
Employer or an Affiliated Employer as indicated in the Adoption
Agreement.
1.16 "Employer" means the Employer or an Affiliated Employer named in the
Adoption Agreement which has adopted this plan, or any successor by
merger, purchase or otherwise, with respect to its employees; or any
other company participating in the Plan as provided in Section 10.05,
with respect to its employees.
1.17 "Entry Date" means the date as designated in A-2.01 of the Adoption
Agreement on which an Employee may become an active Participant in the
Plan after meeting the eligibility requirements of Article 2 specified
in the Adoption Agreement.
1.18 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
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<PAGE> 11
1.19 "Highly Compensated Employee" means any active or former employee of
the Employer or an Affiliated Employer whether or not eligible for
participation in the Plan so determined in accordance with the
following provisions:
(a) during the determination year which is the current Plan Year
or the look-back year which is the immediately - preceding
Plan Year, the employee:
(i) was at any time a 5% owner of the Employer or an
Affiliated Employer;
(ii) received Statutory Compensation from the Employer in
excess of $75,000 multiplied by the Adjustment Factor
as provided by the Secretary of the Treasury;
(iii) received Statutory Compensation from the Employer in
excess of $50,000 multiplied by the Adjustment Factor
as provided by the Secretary of the Treasury, and was
a member of the "top-paid group" which is the highest
20% of employees for that year when ranked by
Statutory Compensation paid by the Employer for that
year excluding, for purposes of determining the
number of such employees, such employees as the
Employer may determine on a consistent basis pursuant
to Section 414(q)(8) of the Code; or
(iv) was at any time an officer of the Employer or an
Affiliated Employer (subject to the limitations of
Section 414(q)(5) of the Code) and received Statutory
Compensation greater than 50% of the dollar
limitation applicable to an annual benefit under a
defined benefit plan for such Plan Year as set forth
in Section 415(b)(1)(A) of the Code.
(b) The term Highly Compensated Employee also includes: (i)
employees who are described in paragraph (a) if the term
"determination year" is substituted for the term "look-back
year" and the employee is one of the 100 Employees who
received the most Statutory Compensation from the Employer
during the determination year; and (ii) employees who are 5%
owners at any time during the look-back year or determination
year. A Highly Compensated former Employee includes any
employee who separated from service (or was deemed to have
separated) prior to the determination year, performs no
service for the Employer during the determination year, and
was a Highly Compensated active Employee for either the
separation year or any determination year on or after the
employee's 55th birthday.
(c) Employees who are nonresident aliens and who receive no earned
income from the Employer or an Affiliated Employer which
constitutes income from sources within the United States shall
be disregarded for all purposes of this Section.
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<PAGE> 12
(d) If no officer has met the Statutory Compensation requirement
outlined in paragraph (a)(iv) above, the highest-paid officer
for such Plan Year shall be treated as a Highly Compensated
Employee.
(e) If an employee is, during a determination year or look-back
year, a family member of either a 5% owner who is an active or
former Employee or a Highly Compensated Employee who is one of
the 10 most Highly Compensated Employees ranked on the basis
of Compensation paid by the Employer during such year, then
the family member and the 5% owner or top-10 Highly
Compensated Employee shall be aggregated. In such case, the
family member and the 5% owner or top-10 Highly Compensated
Employee shall be treated as a single employee receiving
Compensation and Plan contributions or benefits equal to the
sum of such Compensation and contributions or benefits of the
family member and the 5% owner or top-10 Highly Compensated
Employee. For purposes of this section, family member
includes the spouse, lineal ascendants and descendents of the
employee or former employee and the spouses of such lineal
ascendants and descendents.
(f) The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
employees in the top-paid group, the top 100 Employees, the
number of employees treated as officers and the Compensation
that is considered shall be made in accordance with Section
414(q) of the Code and the regulations thereunder.
1.20 "Hour of Service" means, with respect to any applicable computation
period:
(a) each hour for which the Employee is paid or entitled to
payment for the performance of duties for the Employer or an
Affiliated Employer;
(b) each hour for which the Employee is paid or entitled to
payment by the Employer or an Affiliated Employer on account
of a period during which no duties are performed whether or
not the employment relationship has terminated due to
vacation, holiday, illness, incapacity (including disability),
layoff, jury duty, military duty or leave of absence, but not
more than 501 hours for any single continuous period;
(c) each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer or an
Affiliated Employer, excluding any hour credited under (a) or
(b), which shall be credited to the computation period or
periods to which the award, agreement or payment pertains
rather than to the computation period in which the award,
agreement or payment is made; and
(d) solely for purposes of determining whether an Employee had
incurred a Break in Service under a Plan using the
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<PAGE> 13
Regular Method as defined in Section 1.09, each hour for which an
Employee would normally be credited under paragraph (a) or (b) above
during a period in which he is absent from work because of the
pregnancy of the Employee, the birth of a child of the Employee, the
placement of a child with the Employee in connection with the adoption
of such child by such Employee or for purposes of caring for such child
for a period beginning immediately following such birth or placement,
but not more than 501 hours for any single such period, provided,
however, that the number of hours credited to an Employee under this
paragraph (d) during the computation period in which such absence
began, when added to the hours credited to an Employee under paragraphs
(a) through (c) above during such computation period, shall not exceed
501. In the event the number of hours credited under this paragraph
(d) for the computation period in which the absence began is zero, the
provisions of this paragraph (d) shall apply as though the absence
began in the immediately following computation period.
No hours shall be credited on account of any period during which the
employee performs no duties and receives payment solely for the purpose of
complying with unemployment compensation, workers' compensation or
disability insurance laws. The Hours of Service credited shall be
determined as required by Department of Labor Regulations, Section
2530.200b-2(b) and (c) and shall include any Hours of Service completed
during a period of employment with an Affiliated Employer. Hours of Service
shall be credited on the basis of actual hours for which an Employee is paid
or entitled to payment.
1.21 "Leased Employee" means any person who is not an employee of the
Employer and who provides services to the Employer if -
(a) such services are provided pursuant to an agreement between
the Employer and any other person (referred to as the "leasing
organization"),
(b) such person has performed such services for the Employer (or
for the Employer and related persons) on a substantially
full-time basis for a period of at least one year, and
(c) such services are of a type of historically performed, in the
business field of the Employer, by Employees.
In the case of any person who is a Leased Employee immediately before
or after a period of service as an Employee, the entire period during
which he has performed services for the Employer or an Affiliated
Employer as a Leased Employee shall be counted as Eligibility Service
and Vesting Service for all purposes of the Plan, except that he shall
not, by reason of that status, become a Participant of the Plan.
However, a Leased Employee shall not be considered an employee of the
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<PAGE> 14
Employer for any purpose if: (a) such employee is covered by a money
purchase pension plan providing: (1) a nonintegrated employer
contribution rate of at least 10% of compensation, with compensation
being defined in accordance Section 415(c)(3) of the Code but including
in such definition of compensation any amounts contributed pursuant to
a salary reduction agreement which are excludable from the employee's
gross income under Section 125, Section 402(a)(8), Section 402(h) or
Section 403(b) of the Code, (2) immediate participation, (3) full and
immediate vesting, and (b) Leased Employees do not constitute more than
20% of the Employer's nonhighly compensated workforce.
1.22 "Matching Contribution" means all amounts contributed by the Employer
pursuant to an Elective Deferral Contribution or any other
contribution made to the Plan by or on behalf of the Participant.
1.23 "Normal Retirement Age" means the earlier of:
(a) the Normal Retirement Date as designated in A-5.01 of the
Adoption Agreement; or
(b) the ERISA Normal Retirement Age which is the later of:
(i) age 65, or
(ii) the fifth anniversary of the date participation
commenced.
Normal Retirement Age shall not exceed any mandatory retirement age
imposed by the adopting Employer.
1.24 "Owner-Employee" means a sole proprietor or a partner who owns more
than ten percent (10%) of either the capital or profits interest of
the Employer.
1.25 "Participant" means any person who is participating in the Plan as
provided in Article 2. Any former Participant having deferred vested
rights to his Account under this Plan shall also be considered a
"Participant".
Non-Participants making rollover contributions, if permitted in
A-3.02(b)(2) of the Adoption Agreement, shall not be considered
Participants for any other purposes of the Plan.
1.26 "Plan Administrator" means the person(s) or corporation administering
the Plan as designated on page 1 of the Adoption Agreement.
1.27 "Plan Year" means the 12-consecutive-month period designated in the
Adoption Agreement.
1.28 "Present Value" means the current value of a benefit as computed in
accordance with the interest and mortality rates specified in Section
A-1.28 of the Adoption Agreement.
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<PAGE> 15
1.29 "Prototype Sponsor" means Buck Consultants, Inc., 202 West Berry
Street, Suite 700, Fort Wayne, IN 46802, phone # (219) 426-7800.
1.30 "Profits" means both accumulated earnings and profits and current net
taxable income of the Employer before deduction of Federal, state and
local income taxes and before any contributions made by the Employer
to this or any other employee benefit plan maintained by the Employer,
as determined by its independent public accountants in accordance with
generally accepted accounting principles.
The Employer may make contributions to the Plan without regard to the
existence or the amount of current and accumulated earnings and
profits as selected in the Adoption Agreement. Notwithstanding the
foregoing, however, this Plan is designed to qualify as a
"profit-sharing plan" for purposes of Sections 401(a), 402, 412 and
417 of the Code.
1.31 "Qualified Joint and Survivor Annuity" shall mean an immediate annuity
payable for the life of a Participant and after his death, an annuity
payable to his spouse for life at the rate of not less than 50%, nor
more than 100%, of the amount payable to the Participant. The
percentage of any survivor annuity payable under the Plan shall be 50%
unless the Participant elects a greater percentage during the election
period.
1.32 "Self-Employed Individual" means any person who has Earned Income from
the Employer for which the Plan is established for the taxable year or
who would have had Compensation (Earned Income), but for the fact that
the Employer had no net profits for such taxable year.
1.33 "Spousal Consent" means written consent given by a Participant's
spouse to an election made by the Participant of a specified form of
benefit, the designation of a specified Beneficiary, to a
Participant's application to receive an in- service withdrawal under
Section 4.11, or to obtain a loan from the Plan pursuant to Section
3.16. Spousal Consent shall be duly witnessed by a Plan
representative or notary public and shall acknowledge the effect on
the spouse of the Participant's election and the identity of the
designated Beneficiary. The requirement for Spousal Consent may be
waived by the Plan Administrator if it is established to its
satisfaction that there is no spouse or that the spouse cannot be
located or that such other circumstance exists as may be prescribed by
Treasury Regulations.
1.34 "Statutory Compensation" means the wages, salaries, and other amounts
paid in respect of an employee for services actually rendered to an
Employer or an Affiliated Employer, including
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<PAGE> 16
by way of example, overtime, bonuses and commissions, but excluding
deferred compensation, stock options and other distributions which
receive special tax benefits under the Code. Statutory Compensation
shall include Elective Deferral Contributions and amounts contributed
on a Participant's behalf on a salary reduction basis to a cafeteria
plan as described in Section 125 of the Code. For Plan Years beginning
after 1988, Statutory Compensation for Plan purposes shall not exceed
$200,000. For years commencing on or after January 1, 1990, the
$200,000 limitation shall be multiplied by the Adjustment Factor as
provided by the Secretary of the Treasury. When determining the
Statutory Compensation of any Participant who is a Highly Compensated
Employee, the family aggregation rules of Section 414(q)(6) of the Code
shall apply; provided, however, that the term "family" shall include
only the Participant's spouse and lineal descendents who have not
attained age 19 before the close of the Plan Year. If, as a result of
the application of the family aggregation rules, the foregoing
Statutory Compensation limit is exceeded, then the Statutory
Compensation to be considered for Plan Purposes shall be prorated among
the affected individuals on the basis of the individuals' Statutory
Compensation determined prior to the application of the limitation.
If the period for determining Statutory Compensation used in
calculating an Employee's allocation for a determination period is a
short Plan Year (i.e., shorter than 12 months), the annual Statutory
Compensation limit is an amount equal to the otherwise applicable
annual Statutory Compensation limit multiplied by the fraction, the
numerator of which is the number of months in the short Plan Year, and
the denominator of which is 12.
1.35 "Taxable Wage Base" means the maximum amount of annual earnings
subject to tax under the provisions of Section 3121(a)(1) of the Code
as in effect on the first day of each Plan Year.
1.36 "Trustees" means the person(s) or corporation by whom the funds of the
Plan are held as designated in the Adoption Agreement.
1.37 "Valuation Date" means the date (or dates) elected by the Employer in
Section 1.37 of the Adoption Agreement as of which the Account
balances are valued, and such other dates as may be established by the
Plan Administrator from time to time.
1.38 "Vested Portion" means the portion of the Accounts in which the
Participant has a nonforfeitable interest as provided in Section 5.09
or, if applicable, Article 8.
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<PAGE> 17
1.39 "Vesting Service" means service recognized for purposes of determining
a Participant's Vested Portion. Vesting Service shall be computed
under either the Hours Method or the Elapsed Time Method, as selected
in the Adoption Agreement and as further defined below:
(a) Hours Method -- An Employee shall be credited with a year of
Vesting Service for any Plan Year during which the Employee
has completed at least 1,000 Hours of Service. Any year of
Vesting Service where an Employee has less than 1,000 Hours of
Service shall not be counted as a year of Vesting Service.
(b) Elapsed Time Method -- An Employee shall be credited with a
year of Vesting Service based on the Employee's actual period
of employment irrespective of the number of hours actually
worked during such period. All periods of employment,
including periods of severance shall be aggregated unless
there is a one-year period of severance as defined below. A
year of Vesting Service shall be credited for each completed
12 months of service (365 days), which need not be
consecutive.
For purposes of determining years of Vesting Service under the
Elapsed Time Method, the following terms shall apply:
* Date of hire or rehire -- shall mean the date an
Employee first performs one Hour of Service. An
"adjusted" hire date may be used to reflect periods
of severance so that all periods of service can be
aggregated unless such periods can be disregarded
under the Break in Service rules.
* Severance date -- shall mean the earlier of:
(1) the actual date an Employee quits, is
discharged, dies or retires; or
(2) the first anniversary of the date an
Employee is absent from work (with or
without pay) for any other reason; e.g.,
disability, vacation, leave of absence,
layoff, etc.
* Elapsed time -- shall mean the total period of service
between a Participant's date of hire and severance date
including periods of severance where a one-year period
of severance does not occur.
* Period of service -- shall mean the total elapsed time
while an Employee is employed regardless of the number
of hours worked.
* Month of service -- shall be credited for each 30 days
of elapsed time.
* Period of severance -- shall mean the time between the
actual severance date as defined above and the
subsequent date, if any, on which the Employee performs
one Hour of Service.
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<PAGE> 18
* One-year period of severance -- shall mean a one-year
Break in Service as defined in Section 1.09 which is the
12-month period following a Participant's severance date
as defined above in which an Employee does not have one
Hour of Service.
1.40 Construction
(a) The Plan shall be construed, regulated and administered under
ERISA and the laws of the state in which the Employer's primary
business is located, except where ERISA controls.
(b) The masculine pronoun shall mean the feminine and the singular
shall mean the plural wherever appropriate.
- 15 -
<PAGE> 19
Article 2. Eligibility
2.01 Each Employee shall automatically become a Participant on the Entry
Date on or immediately after the date he meets the requirements
designated in the Adoption Agreement unless he terminates his service
prior to such Entry Date.
2.02 An Employee shall be credited with one year of eligibility service for
the 12-consecutive-month period beginning on his employment
commencement date which is the date he first completes an Hour of
Service and during any Plan Year beginning on or after the date he
first completes an Hour of Service if he completes at least 1,000
Hours of Service during that 12- consecutive-month period or Plan
Year. For purposes of determining years of eligibility service for an
Employee who terminates employment before becoming a Participant of
the Plan, his years of eligibility service prior to the termination or
Break in Service shall be disregarded if the number of consecutive
one-year Breaks in Service equals or exceeds the greater of (i) five
or (ii) the number of years of eligibility service completed before
the Break in Service began.
2.03 Prior to becoming a Participant in the Plan, an Employee shall be
asked to complete a form or forms prescribed by the Plan Administrator
on which he:
(a) names a Beneficiary; and
(b) makes an investment election, if such election is permitted by
the Adoption Agreement.
2.04 Any person reemployed by the Employer as an Employee who was
previously a Participant shall immediately become a Participant in the
Plan upon his reemployment date. Such Employee shall be asked to
complete a form or forms prescribed by the Plan Administrator in
accordance with Section 2.02.
In the event an active Participant becomes ineligible to participate
because he is no longer a member of the eligible class, but has not
incurred a one year Break in Service, such Employee shall again become
an active Participant as of the date on which he again becomes a
member of the eligible class.
In the event an Employee who is not a member of the eligible class
becomes a member of the eligible class, such Employee shall
participate immediately if such Employee has satisfied the
requirements for eligibility specified in the Adoption Agreement and
would have previously become an active Participant had he then been a
member of the eligible class.
2.05 A Participant who remains in the employ of the Employer or an
Affiliated Employer but ceases to be an Employee shall continue to be
a Participant in the Plan but shall not be
- 16 -
<PAGE> 20
eligible to receive allocations of any type of Employer contributions
while his employment status is other than that of the eligible class of
Employees.
2.06 A Participant's participation shall terminate on the later of the date
he terminates employment with the Employer or an Affiliated Employer
or the date the vested Portion of his Account(s) is distributed to
him.
- 17 -
<PAGE> 21
Article 3. Contributions and Allocations
3.01 Subject to the limitations of this Article 3, the Employer shall
contribute, within the time prescribed by law for making a deductible
contribution, the amount designated in the Adoption Agreement. In no
event, however, shall such contributions for the Fiscal Year exceed
the maximum deductible amount. Contributions shall be allocated as of
the last day of the Plan Year and as of such other date or dates to be
determined by the Trustee.
Additional Requirements for Qualification of Trusts and Plans
Benefiting Owner-Employees - a trust forming part of a pension or
profit sharing plan which provides contributions or benefits for
employees some or all of whom are Owner- Employees shall constitute a
qualified trust under Section 401(d) of the Code only if, in addition
to meeting the requirements of Section 401(a) of the Code, the
following requirements of this subsection are met by the trust and by
the plan of which such trust is a part:
(a) If the plan provides contributions for an Owner-Employee who
controls, or for two or more Owner-Employees who together
control, the trade or business with respect to which the Plan
is established, and who also control as an Owner-Employee or as
Owner-Employees one or more other trades or businesses, such
plan and the plans established with respect to such other
trades or businesses, when coalesced, constitute a single plan
which meets the requirements of the Code with respect to the
employees of all such trades or businesses (including the trade
or business with respect to which the plan intended to qualify
under this section is established). If an individual is
covered as an Owner-Employee under the plan of two or more
trades or businesses which are not controlled, and the
individual does control a trade or business, then the
contributions or benefits of the Employees under the plan of
the trade or business which is controlled must be as favorable
as those provided to such Owner-Employee under the most
favorable plan of the trade or business which is not
controlled.
(b) For purposes of Paragraph (a), an Owner-Employee, or two or
more Owner-Employees, shall be considered to control a trade or
business if such Owner-Employee, or such two or more
Owner-Employees together -
(i) own the entire interest in an unincorporated trade or
business, or
(ii) in the case of a partnership, own more than 50% of either
the capital interest or the profits interest in such
partnership.
For purposes of the preceding sentence, an Owner-Employee, or
two or more Owner-Employees, shall be treated as owning any
interest in a partnership which is owned, directly or
- 18 -
<PAGE> 22
indirectly, by a partnership which such Owner-Employee, or such
two or more Owner-Employees, are considered to control within
the meaning of the preceding sentence.
3.02 If so designated in the Adoption Agreement and without regard to any
limitations on contributions set forth in the Plan, the Plan may
receive from a Participant or from an Employee who is not yet eligible
to become a Participant, in cash, any amount previously received by
him from a qualified plan, either directly within 60 days after such
receipt or indirectly from an individual retirement account within the
time prescribed by applicable law, provided that such amount includes
no assets other than those attributable to employer contributions and
earnings on employee contributions under plans qualified under Section
401(a) of the Code and provided that such amount is eligible for
rollover treatment to a qualified trust in accordance with Section
402(a)(5) of the Code and the Employee provides evidence satisfactory
to the Employer that such amount qualifies for rollover treatment.
The rollover contributions shall be paid to the Trustees as soon as
practicable.
3.03 Effective with the date this Prototype is adopted by the Employer, the
Plan does not permit a Participant to make contributions to the Plan
on an after-tax basis.
Employee contributions for Plan Years beginning after December 31,
1986, together with any matching contributions as defined in Section
401(m) of the Code, shall be limited so as to meet the
nondiscrimination test of Section 401(m).
A separate Participant account shall be maintained for the after-tax
Employee contributions of each Participant.
Employee contributions and investment earnings thereon shall be 100%
vested and nonforfeitable at all times.
A Participant may withdraw after-tax contributions plus investment
earnings by making a written application to the Plan Administrator. A
withdrawal may be made only once in any 12-month period and if the
Participant is married, shall be subject to obtaining Spousal Consent
within 90 days of the distribution. No forfeitures shall occur solely
as a result of a withdrawal of employee contributions.
3.04 Allocation of earnings shall be handled as follows:
(a) The net earnings, gains, losses and expenses as well as
appreciation and depreciation in fair market value shall be
credited to the general investment fund and shall be allocated
to Participant's Accounts at the end of each allocation period
on a pro-rata basis based on each Participant's Account balance
(exclusive of amounts
- 19 -
<PAGE> 23
invested in a designated investment fund) as provided in Section
A-3.04 of the Adoption Agreement.
(b) Any designated investment fund shall not share in the general
investment fund earnings, but shall be charged or credited, as
appropriate, with net earnings, gains, losses and expenses as
well as appreciations or depreciations in fair market value
during each allocation period attributable to such account.
3.05 At least once a year, each Participant shall be furnished with a
statement setting forth the value of his Accounts and the Vested
Portion of his Accounts.
3.06 Forfeitures shall be used to reduce the Employer's contributions under
Section 3.01.
3.07 If the Commissioner of Internal Revenue, on timely application made
after the initial establishment of the Plan, determines that the Plan
is not qualified under Section 401(a) of the Code, or refuses, in
writing, to issue a determination as to whether the Plan is so
qualified, the Employer's contributions made on or after the date on
which that determination or refusal is applicable shall be returned to
the Employer. The return shall be made within one year after the
denial of qualification. The provisions of this paragraph (a) shall
apply only if the application for the determination is made by the
time prescribed by law for filing the Employer's return for the
taxable year in which the Plan was adopted, or such later date as the
Secretary of the Treasury may prescribe.
3.08 All contributions to be made under the Plan are specifically and
expressly conditioned upon their deductibility for Federal tax
purposes. If all, or part of, the Employer's deductions under Section
404 of the Code for contributions to the Plan are disallowed by the
Internal Revenue Service, the portion of the contributions to which
that disallowance applies shall be returned to the Employer without
interest but reduced by any investment loss attributable to those
contributions. The return shall be made within one year after the
disallowance of deduction.
3.09 The Employer may recover without interest the amount of its
contributions to the Plan made on account of a mistake of fact,
reduced by any investment loss attributable to those contributions, if
recovery is made within one year after the date of those
contributions.
3.10 Contributions to the Plan shall be invested in one or more investment
funds, as authorized by the Employer from time to time.
(a) The Trustees shall receive, hold, invest, and reinvest all
contributions and monies of this trust in either a general
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<PAGE> 24
investment fund or a designated investment fund or a combination
thereof. Investments shall be limited to property of a character
which is consistent with Section 503 of the Code for investments
under qualified plans which are not in violation of the
limitations on Employer securities or real property under ERISA.
The Trustees shall exercise the judgment and care under the
circumstances then prevailing, which individuals of prudence,
discretion, and intelligence familiar with such matters would
exercise in a like situation, and shall diversify such
investments to minimize the risk of large losses.
(b) The Trustees are authorized and empowered to invest and
reinvest the principal and income in real or personal property
including, but not limited to, any common or preferred stocks,
bonds, notes, mortgages, trust certificates, mutual funds,
insurance contracts, and pooled accounts of a bank or trust
company maintained exclusively for qualified plans. In making
such investments or reinvestments, the Trustees have wide
latitude in the selection of investments and shall not be
restricted to securities or other property of a character
authorized or required by applicable sate law for trust
investments.
(c) The Trustees may keep such amounts of cash as they, in their
sole discretion, shall deem necessary or advisable as part of
the funds.
(d) Dividends, interest, and other distributions received on the
assets held by the Trustees in respect to each of the funds
shall be reinvested in the respective fund.
3.11 If permitted by the Plan in A-3.11 of the Adoption Agreement, a
Participant shall be permitted to make one investment election for his
Accounts in accordance with one of the following options:
(a) 100% in one of the available investment funds;
(b) in more than one investment fund allocated in full percentages.
3.12 Each Participant is solely responsible for the selection of his
investment option. The Trustees, the Plan Administrator, the
Employer, and the officers, supervisors and other employees of the
Employer are not empowered to advise a Participant as to the manner in
which his Accounts shall be invested. The fact that an investment
fund is available to Participants for investment under the Plan shall
not be construed as a recommendation for investment in that investment
fund.
3.13 A Participant may change his investment election by giving advance
written notice to the Plan Administrator. The changed investment
election shall become effective as of the first day of the month
following the Valuation Date occurring
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<PAGE> 25
concurrent with or immediately after the expiration of the notice
period, and shall be effective only with respect to subsequent
contributions.
3.14 A Participant may elect to reallocate his Accounts among the
investment funds by giving advance written notice to the Plan
Administrator. The reallocation shall be effective as of the first
day of the month following the Valuation Date occurring concurrent
with or immediately after the expiration of the notice period.
3.15 Notwithstanding anything in this Article to the contrary, any
contributions invested in a guaranteed investment contract or other
contract that imposes a penalty for a withdrawal prior to maturity
shall be subject to any and all terms of such contract, including any
limitations placed on the exercise of any rights otherwise granted to
a Participant under any other provisions of this Plan with respect to
such contributions.
3.16 If elected in the Adoption Agreement, the Trustees may make loans to
Participants subject to the following conditions:
(a) Loans shall be made available to all Participants and
Beneficiaries on a reasonably equivalent basis.
(b) Loans shall not be made available to Highly Compensated
Employees (as defined in Section 414(q) of the Code) in the
amount greater than the amount made available to other
Employees.
(c) Loans shall not be granted for amounts less than $1,000.
(d) Any administrative expense directly related to the loan may be
paid by the Participant, or paid by the Employer in a
consistent and nondiscriminatory manner.
(e) Loans must be adequately secured and bear a reasonable interest
rate.
(f) No loans shall be made to any shareholder-employee or owner-
employee. For purposes of this requirement, a
shareholder-employee means an employee or officer of an
electing small business (Subchapter S) corporation who owns [or
is considered as owning within the meaning of Section 318(a)(1)
of the Code], on any day during the taxable year of such
corporation, more than 5% of the outstanding stock of the
corporation.
(g) No loan to any Participant or Beneficiary can be made to the
extent that such loan when added to the outstanding balance of
all other loans to the Participant or Beneficiary would exceed
the lesser of:
(i) $50,000, reduced by the excess (if any) of the highest
outstanding balance of loans during the one year period
ending on the day before the loan is made, over the
outstanding balance of loans from the Plan on the date
the loan is made; or
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<PAGE> 26
(ii) 50% of the Vested Portion of the Participant's Accounts.
For the purpose of the above limitation, all loans from all
plans of the Employer or an Affiliated Employer are aggregated.
Furthermore, any loan shall by its terms require that repayment
(principal and interest) be amortized in level payments, not
less frequently than quarterly, over a period not extending
beyond five years from the date of the loan, unless such loan
is used to acquire a dwelling unit which within a reasonable
time (determined at the time the loan is made) shall be used as
the principal residence of the Participant. An assignment or
pledge of any portion of the Participant's interest in the Plan
and a loan, pledge, or assignment with respect to any insurance
contract purchased under the Plan, shall be treated as a loan
under this paragraph.
(h) In the event of default, foreclosure on the note and attachment
of security shall not occur until a distributable event occurs
in the Plan.
(i) A Participant must obtain the consent of his spouse, if any, to
use the Account balance as security for the loan. Spousal
Consent shall be obtained no earlier than the beginning of the
90-day period that ends on the date on which the loan is to be
so secured. The consent must be in writing, must acknowledge
the effect of the loan, and must be witnessed by a Plan
representative or notary public. Such consent shall thereafter
be binding with respect to the consenting spouse or any
subsequent spouse with respect to that loan. A new Spousal
Consent shall be required if the Account balance is used for
renegotiation, extension, renewal, or other revision of the
loan.
If a valid Spousal Consent has been obtained in accordance with (i),
then, notwithstanding any other provision of this Plan, the Vested
Portion of the Participant's Accounts used as a security interest held
by the Plan by reason of a loan outstanding to the Participant shall
be taken into account for purposes of determining the amount of the
Account balance payable at the time of death or distribution, but only
if the reduction is used as repayment of the loan.
Any additional rules or restrictions as may be necessary to implement
and administer the loan program shall be in writing and communicated
to employees. Such further documentation is hereby incorporated into
the Plan by reference, and the Plan Administrator is hereby authorized
to make such revisions to these rules as are deemed necessary or
appropriate, on the advice of counsel.
To the extent required by law and under such rules as the Plan
Administrator adopts, loans shall also be made available on a
reasonably equivalent basis to any Beneficiary or former
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<PAGE> 27
Employee (i) who maintains an account balance under the Plan and (ii)
who is still a party-in-interest (within the meaning of Section 3(14)
or ERISA).
=====================================================================
SECTIONS 3.17 THROUGH 3.20 APPLY TO EMPLOYERS WHO DO NOT MAINTAIN ANY
QUALIFIED PLAN IN ADDITION TO THIS PLAN.
=====================================================================
3.17 If the Participant does not participate, and has never participated,
in another qualified Plan, or a welfare benefit fund, as defined in
Section 419(e) of the Code, or an individual medical account, as
defined in Section 415(1)(2) of the Code, which provides an Annual
Addition as defined in Section 3.29(a), all of which are maintained by
the Employer, the amount of Annual Additions which may be credited to
the Participant's Account for any Limitation Year shall not exceed the
lesser of the Maximum Permissible Amount or any other limitation
contained in this Plan. If the Employer contribution that would
otherwise be contributed or allocated to the Participant's Account
would cause the Annual Additions for the Limitation Year to exceed the
Maximum Permissible Amount, the amount contributed or allocated shall
be reduced so that the Annual Additions for the Limitation Year shall
equal the Maximum Permissible Amount.
3.18 Prior to determining the Participant's actual Compensation for the
Limitation Year, the Employer may determine the Maximum Permissible
Amount for a Participant on the basis of a reasonable estimation of
the Participant's Compensation for the Limitation Year, uniformly
determined for all Participants similarly situated.
3.19 As soon as administratively feasible after the end of the Limitation
Year, the Maximum Permissible Amount for the Limitation Year shall be
determined on the basis of the Participant's actual Compensation for
the Limitation Year.
3.20 If there is an excess Annual Addition due to the application of
Section 3.18 or the allocation of a forfeiture, the excess shall be
disposed of as follows:
(a) Any nondeductible voluntary employee contributions, to the
extent they would reduce excess Annual Addition, shall be
returned to the Participant.
(b) If after the application of paragraph (a), an excess Annual
Addition still exists, and the Participant is covered by the
Plan at the end of the Limitation Year, the excess Annual
Addition in the Participant's Account shall be used to reduce
Employer contributions for such Participant in the next
Limitation Year, and each succeeding Limitation Year if
necessary.
- 24 -
<PAGE> 28
(c) If after the application of paragraph (a), an excess Annual
Addition still exists, and the Participant is not covered by
the Plan at the end of a Limitation Year, the excess Annual
Addition shall be held unallocated in a suspense account. The
suspense account shall be applied to reduce future Employer
contributions for all remaining Participants in the next
Limitation Year, and each succeeding Limitation Year if
necessary.
(d) If a suspense account is in existence at any time during a
Limitation Year pursuant to this Section, it shall not
participate in the allocation of the trust's investment gains
and losses. If a suspense account is in existence at any time
during a particular Limitation Year, all amounts in the
suspense account must be allocated and reallocated to
Participant's Accounts before any Employer contributions or any
Employee contributions may be made to the Plan for that
Limitation Year. Excess Annual Additions may not be
distributed to Participants or former Participants.
======================================================================
SECTIONS 3.21 THROUGH 3.26 APPLY TO EMPLOYERS WHO, IN ADDITION TO
THIS PLAN, MAINTAIN ONE OR MORE PLANS, ALL OF WHICH ARE EITHER
QUALIFIED MASTER OR PROTOTYPE DEFINED CONTRIBUTION PLANS OR A
WELFARE BENEFIT FUND AS DEFINED IN SECTION 419(e) OF THE CODE.
======================================================================
3.21 If, in addition to this Plan, the Participant is covered under another
qualified master or prototype defined contribution plan, a welfare
benefit fund, as defined in Section 419(e) of the Code, or an
individual medical account, as defined in Section 415(1)(2) of the
Code, all of which are maintained by the Employer and which provides
an Annual Addition as defined in Section 3.29(a) during any Limitation
Year, the Annual Additions which may be credited to a Participant's
Account under this Plan for any such Limitation Year shall not exceed
the Maximum Permissible Amount reduced by the Annual Additions
credited to a Participant's Account under the other plans and welfare
benefit funds for the same Limitation Year. If the Annual Additions
with respect to the Participant under other defined contribution plans
and welfare benefit funds maintained by the Employer are less than the
Maximum Permissible Amount and the Employer contribution that would
otherwise be contributed or allocated to the Participant's Account
under this Plan would cause the Annual Additions for the Limitation
Year to exceed this limitation, the amount contributed or allocated
shall be reduced so that the Annual Additions under all such plans and
funds for the Limitation Year shall equal the Maximum Permissible
Amount. If the Annual Additions with respect to the Participant under
such other defined contribution plans and welfare benefit funds in
- 25 -
<PAGE> 29
the aggregate are equal to or greater than the Maximum Permissible
Amount, no amount shall be contributed or allocated to the
Participant's Account under this Plan for the Limitation Year.
3.22 Prior to determining the Participant's actual Compensation for the
Limitation Year, the Employer may determine the Maximum Permissible
Amount for a Participant in the manner described in Section 3.18.
3.23 As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for the Limitation
Year shall be determined on the basis of the Participant's actual
Compensation for the Limitation Year.
3.24 If, pursuant to Section 3.23, a Participant's Annual Additions under
this Plan and such other plans would result in an excess Annual
Addition for a Limitation Year, the excess Annual Addition shall be
deemed to consist of the Annual Additions last allocated, except that
Annual Additions attributable to a welfare benefit fund or individual
medical account shall be deemed to have been allocated first
regardless of the actual allocation date.
3.25 If an excess Annual Addition was allocated to a Participant on the
Valuation Date of this Plan which coincides with a Valuation Date of
another plan, the excess Annual Addition attributed to this Plan shall
be the product of,
(a) the total excess Annual Addition allocated as of such date,
times
(b) the ratio of:
(i) the Annual Additions allocated to the Participant for
the Limitation Year as of such date under this Plan, to
(ii) the total Annual Additions allocated to the Participant for
the Limitation Year as of such date under this and all other
qualified Master or Prototype defined contribution plans.
3.26 Any excess Annual Addition attributed to this Plan due to the
application of Section 3.18 or the allocation of a forfeiture shall be
disposed in the manner described in Section 3.20.
3.27 If the Participant is covered under another qualified defined
contribution plan maintained by the Employer which is not a Master or
Prototype Plan, Annual Additions which may be credited to the
Participant's Account under this Plan for any Limitation Year shall be
limited in accordance with Sections 3.21 through 3.26 as though the
other plan were a Master or Prototype Plan unless the Employer
provides other limitations in Section A-3.27 of the Adoption
Agreement.
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<PAGE> 30
3.28 If the Employer maintains, or at any time maintained, a qualified
defined benefit plan covering any Participant in this Plan, the sum of
the Participant's Defined Benefit Plan Fraction and Defined
Contribution Plan Fraction shall not exceed 1.0 in any Limitation
Year. The Annual Additions which may be credited to the Participant's
Account under this Plan for any Limitation Year shall be limited in
accordance with Section A-3.28 of the Adoption Agreement.
3.29 For purposes of this Article, the following terms shall be defined as
follows:
(a) Annual Additions - The sum of the following amounts allocated
on behalf of a Participant for a Limitation Year:
(i) all Employer and Employee contributions, excluding any
Rollover Contributions; provided, however, that with
respect to Limitation Years beginning before 1987, only
the lesser of a Participant's contributions in excess of
6% of his compensation or one-half of his total
contributions to any plan or plans shall be considered;
(ii) all forfeitures,
(iii) contributions made after March 31, 1984 to a
Participant's individual medical account, as defined in
Section 415(1)(2) of the Code, which is part of a pension
or annuity plan maintained by the Employer, and
(iv) amounts derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such
date, which are attributable to post-retirement medical
benefits allocated to the separate account of a key
employee, as defined in Section 419A(d)(3) of the Code or
under a welfare benefit fund, as defined in Section
419(e) of the Code, maintained by the Employer.
(b) Limitation Year - each Plan Year.
(c) Compensation - solely for purposes of Sections 3.17 through
3.29, the term "Compensation" means a Participant's earned
income, wages, salaries, fees for professional service and
other amount received for personal services actually rendered
in the course of employment with an Employer maintaining the
Plan (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a
percentage of profits, commissions on insurance premiums, tips,
and bonuses) and excluding the following:
(i) Employer contributions to a plan of deferred
compensation to the extent contributions are not
included in gross income of the Employee for the taxable
year in which contributed, or on behalf of an Employee
to a Simplified Employee Pension Plan to the
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<PAGE> 31
extent such contributions are deductible under Section
219(b)(7) of the Code, and any distributions from a plan
of deferred compensation whether or not includable in the
gross income of the Employee when distributed;
(ii) amounts realized from the exercise of a non-qualified
stock option, or when restricted stock (or property)
held by an Employee becomes freely transferable or is no
longer subject to a substantial risk of forfeiture;
(iii) amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock
option; and
(iv) other amounts which receive special tax benefits, or
contributions made by an Employer (whether or not under
a salary reduction agreement) towards the purchase a
403(b) annuity contract (whether or not the
contributions are excludable from the gross income of
the Employee).
For any Limitation Year, Compensation is the amount actually
paid or includible in the Participant's gross income during
such year.
(d) Defined Benefit Plan - Any pension plan which is not a defined
contribution plan. However, in the case of a defined benefit
plan which provides a benefit which is based partly on the
balance of the separate account of a Participant, that plan
shall be treated as a defined contribution plan to the extent
benefits are based on the separate account of a Participant and
as a defined benefit plan with respect to the remaining portion
of the benefits under the plan.
(e) Defined Benefit Plan Fraction - A fraction:
(i) the numerator of which is the projected annual benefit
of the Participant under all defined benefit plans
(whether or not terminated) maintained by the Employer
(determined as of the close of the Plan Year), and
(ii) the denominator of which is the lesser of:
(A) the product of 1.25 multiplied by $90,000 or such
other amount as provided in accordance with the
provisions of Section 415(d)(1)(A) of the Code;
or
(B) the product of
(I) 1.4, multiplied by
(II) the amount of Compensation as averaged
over the three-year period giving the
highest average to the Participant which
may be taken into account with respect to
the Participant under the Plan for such
year.
(f) Defined Contribution Plan - A pension plan which provides for
an individual account for each Participant and for benefits
based solely upon the amounts contributed to the Participant's
account, and any income, expenses, gains and
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<PAGE> 32
losses, and any forfeitures of accounts of other Participants
which may be allocated to that Participant's accounts.
(g) Defined Contribution Plan Fraction - A fraction:
(i) the numerator of which is the sum of Annual Additions to
the Participant's account under all defined contribution
plans (whether or not terminated) maintained by the
Employer for the current and all prior Limitation Years,
(including the Annual Additions attributable to the
Participant's nondeductible employee contributions to
all defined benefit plans, whether or not terminated,
maintained by the Employer, and the Annual Additions
attributable to all welfare benefit funds, as defined in
Section 419(e) of the Code, and individual medical
accounts, as defined in Section 415(1)(2) of the Code
maintained by the Employer), and
(ii) the denominator of which is the sum of the lesser of the
following amounts determined for such year and each
prior year of service with the Employer:
(A) the product of 1.25, multiplied by $30,000 (or
such larger amount as in effect under Section
415(c)(1)(A) of the Code); or
(B) the product of
(I) 1.4, multiplied by
(II) 25% of the Participant's Compensation for
such year.
If the Employee was a Participant as of the end of the first
day of the first Limitation Year beginning after December 31,
1986, in one or more defined contribution plans maintained by
the Employer which were in existence on May 6, 1986, the
numerator of this fraction shall be adjusted if the sum of this
fraction and the defined benefit fraction would otherwise
exceed 1.0 under the terms of this Plan. Under the adjustment,
an amount equal to the product of (1) the excess of the sum of
the fractions over 1.0 times (2) the denominator of this
fraction, shall be permanently subtracted from the numerator of
this fraction. The adjustment is calculated using the
fractions as they would be computed as of the end of the last
Limitation Year beginning before January 1, 1987, and
disregarding any changes in the terms and conditions of the
Plan made after May 5, 1986, but using the section 415
limitation applicable to the first Limitation Year beginning on
or after January 1, 1987. The Annual Addition for any
Limitation Year beginning before January 1, 1987, shall not be
recomputed to treat all employee contributions as Annual
Additions.
(h) Master or Prototype Plan - A plan, the form of which is the
subject of a favorable opinion letter from the Internal Revenue
Service.
(i) Maximum Permissible Amount - The annual addition to a
Participant's Accounts for any Plan Year when added to the
Participant's Annual Addition for that Plan Year under any
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<PAGE> 33
other qualified defined contribution plan of the Employer or an
Affiliated Employer, shall not exceed an amount which is equal
to the lesser of (i) 25% of his aggregate Compensation, as
defined in Section 3.29(c), for that Plan Year or (ii) the
greater of $30,000 or one-quarter of the dollar limitation in
effect under Section 415(b)(1)(A) of the Code.
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<PAGE> 34
Article 4. Cash or Deferred Arrangement (CODA)
4.01 If the Plan contains a cash or deferred arrangement, the provisions of
this Article shall apply:
(a) A Participant may elect to reduce his Compensation payable
while a Participant in accordance with the provisions of the
Adoption Agreement and have that amount contributed to the Plan
by the Employer as Elective Deferral Contributions. In no
event shall the availability to make Elective Deferral
Contributions discriminate in favor of Highly Compensated
Employees. For purposes of this paragraph (a), Elective
Deferral Contributions for any Plan Year may only be elected
prospectively with respect to Compensation that would have been
received by the Participant in the Plan Year but for his
election to defer under this Section 4.01 or which is
attributable to services performed by the Employee in the Plan
Year and would have been received by the Participant within 2
1/2 months after the close of the Plan Year if the Participant
had not elected to defer that amount under this Section 4.01.
The Elective Deferral Contributions shall be promptly paid to
the Trustees as soon as administratively possible following the
end of the month in which such amount would otherwise have been
paid to the Participant. Elective Deferral Contributions shall
be further limited as provided in Section 4.03 and paragraph
(b) below.
(b) In no event shall the Participant's reduction in Compensation
and the corresponding Elective Deferral Contributions made on
his behalf by the Employer or an Affiliated Employer in any
calendar year exceed the greater of $7,000 or the dollar limit
in effect under Section 402(g) of the Code as of the first day
of that calendar year. If a Participant's Elective Deferral
Contributions in a calendar year reach this dollar limitation,
his election of Elective Deferral Contributions for the
remainder of the calendar year shall be cancelled. As of the
first pay period of the following calendar year, the
Participant's election of Elective Deferral Contributions shall
again become effective in accordance with his previous
election.
(c) If a Participant makes tax-deferred contributions under another
qualified defined contribution plan for any calendar year and
those contributions when added to his Elective Deferral
Contributions under this Plan exceed the dollar limitation
under paragraph (b) above for that calendar year, the
Participant may assign all or a portion of such excess
deferrals to this Plan. In that event, the excess deferrals,
together with any investment earnings thereon, as assigned,
shall be returned to the Participant no later than the April 15
following the end of the calendar year in which the excess
deferrals were made. However, the Plan shall not be required
to return
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<PAGE> 35
excess deferrals unless the Participant notifies the Plan
Administrator, in writing, by March 1 of that following calendar
year of the amount of the excess deferrals assigned to this
Plan. In addition, the amount of any excess deferrals to be
returned for any calendar year shall be reduced by any excess
contributions previously returned to the Participant under
Section 4.03(a)(ii) for that calendar year. In the event any
Elective Deferral Contributions returned under this paragraph
(c) were matched by Employer contributions under Section 4.02,
the corresponding Matching Contributions, together with any
investment earnings thereon, determined in accordance with
A-3.04 of the Adoption Agreement, to the extent vested shall be
paid to the Participant and to the extent forfeitable under the
Plan shall be forfeited and used to reduce Employer
contributions.
4.02 If elected in the Adoption Agreement, the Employer shall contribute a
Matching Contribution on behalf of each of its Participants who makes
the election described in Section 4.01. The Matching Contributions
shall be paid to the Trustees as soon as practicable.
4.03 The following are limitations affecting Highly Compensated Employees:
(a) Limitation Based on Actual Deferral Percentage - The Actual
Deferral Percentage for Highly Compensated Employees who are
Participants or eligible to become Participants shall not
exceed the Actual Deferral Percentage for all other Employees
who are Participants or eligible to become Participants
multiplied by 1.25. If the Actual Deferral Percentage does not
meet the foregoing test, the Actual Deferral Percentage for
Highly Compensated Employees may not exceed the lesser of the
Actual Deferral Percentage for all other Employees who are
Participants or eligible to become Participants plus two
percentage points or such Actual Deferral Percentage multiplied
by 2.0 (or effective for Plan Years commencing after 1988 such
lesser amount as the Plan Administrator shall determine to
satisfy the provisions of paragraph (c) below). The Plan
Administrator may implement rules limiting the Elective
Deferral Contributions which may be made on behalf of some or
all Highly Compensated Employees so that this limitation is
satisfied.
(i) Special Rules:
(1) The Actual Deferral Percentage for any
Participant who is a Highly Compensated Employee
for the Plan Year, and who is eligible to have
Elective Deferral Contributions (and qualified
non-elective contributions, if treated as
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<PAGE> 36
Elective Deferral Contributions for purposes of
the Actual Deferral Percentage test) allocated to
his accounts under two or more arrangements
described in Section 401(k) of the Code, that are
maintained by the Employer, shall be determined as
if such Elective Deferral Contributions (and, if
applicable, such qualified non-elective
contributions) were made under a single
arrangement. If a Highly Compensated Employee
participates in two or more cash or deferred
arrangements that have different Plan Years, all
cash or deferred arrangements ending with or
within the same calendar year shall be treated as
a single arrangement. Notwithstanding the
foregoing, certain plans shall be treated as
separate if mandatorily disaggregated under
regulations under Section 401(k) of the Code.
(2) In the event that this Plan satisfies the
requirements of Sections 401(k), 401(a)(4), or
410(b) of the Code only if aggregated with one or
more other plans, or if one or more other plans
satisfy the requirements of such sections of the
Code only if aggregated with this Plan, then this
section shall be applied by determining the Actual
Deferral Percentage of Employees as if all such
plans were a single plan. Plans may be aggregated
in order to satisfy Section 401(k) of the Code
only if they have the same Plan Year.
(3) For purposes of determining the Actual Deferral
Percentage of a Participant who is a 5% owner or
one of the 10 most highly-paid Highly Compensated
Employees, the Elective Deferral Contributions
(and qualified non-elective contributions, if
treated as Elective Deferral Contributions for
purposes of the Actual Deferral Percentage test)
and Compensation of such Participant shall include
the Elective Deferral Contributions, (and, if
applicable, qualified non-elective contributions)
and Compensation for the Plan Year of family
members (as defined in Section 414(q)(6) of the
Code). Family members with respect to such Highly
Compensated Employees, shall be disregarded as
separate employees in determining the Actual
Deferral Percentage both for Participants who are
non-Highly Compensated Employees and for
Participants who are Highly Compensated Employees.
(4) For purposes of determining the Actual
Deferral Percentage test, Elective Deferral
Contributions and qualified non-elective
contributions must be made before the last day of
the 12-month period
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<PAGE> 37
immediately following the Plan Year to which
contributions relate.
(5) The employer shall maintain records sufficient to
demonstrate satisfaction of the Actual Deferral
Percentage test and the amount of qualified
non-elective contributions used in such test.
(6) The determination and treatment of the Actual
Deferral Percentage amounts of any Participant
shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
If the Plan Administrator determines that the limitation under
this paragraph (a) has been exceeded in any Plan Year, the
following provisions shall apply:
(i) The Elective Deferral Contributions which were made on
behalf of some or all Highly Compensated Employees shall
be reduced until the provisions of this paragraph are
satisfied, by levelling the highest percentage rates
elected by the Highly Compensated Employees. Such
percentage rates shall be rounded to the nearest
one-hundredth of 1% of the Participant's Compensation.
(ii) Elective Deferral Contributions subject to reduction
under this paragraph ("excess contributions"), together
with any investment earnings thereon, shall be paid to
the Participant before the close of the Plan Year
following the Plan Year in which the excess
contributions were made, and to the extent practicable
within 2 1/2 months of the close of the Plan Year in
which the excess contributions were made. However, any
Elective Deferral Contributions to be returned under
this paragraph (a) for any Plan Year shall be reduced by
any excess deferrals previously returned to the
Participant under Section 4.01(c) for that Plan Year.
If such excess amounts are distributed more than 2 1/2
months after the last day of the Plan Year in which such
excess amounts arose, a 10% excise tax shall be imposed
on the Employer with respect to such amounts. Excess
Contributions of Participants who are subject to the
family member aggregation rules described in Section
4.03(d) shall be allocated among the family members in
proportion to the Elective Deferral Contributions (and
amounts treated as Elective Deferral Contributions) of
each family member that is combined to determine the
combined Actual Deferral Percentage. In the event any
Elective Deferral Contributions returned under this
paragraph (a) were matched by Employer contributions,
such corresponding Employer Matching Contributions,
together with any
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<PAGE> 38
investment earnings thereon, determined in accordance
with A-3.04 of the Adoption Agreement, to the extent
vested shall be paid to the Participant and to the extent
forfeitable under the Plan shall be forfeited and used to
reduce Employer contributions.
(b) Limitation Based on Actual Contribution Percentage - The Actual
Contribution Percentage for Highly Compensated Employees who
are Participants or eligible to become Participants shall not
exceed the Actual Contribution Percentage for all other
Employees who are Participants or eligible to become
Participants multiplied by 1.25. If the Actual Contribution
Percentage does not meet the foregoing test, the Actual
Contribution Percentage for Highly Compensated Employees may
not exceed the lesser of the Actual Contribution Percentage of
all other Employees who are Participants or eligible to become
Participants plus two percentage points or such Actual
Contribution Percentage multiplied by 2.0 (or effective for
Plan years beginning after 1988, such lesser amount as the Plan
Administrator shall determine to satisfy the provisions of
paragraph (c) below).
(i) Special rules:
(1) Multiple Use: As described in Section 4.03(c),
if one or more Highly Compensated Employees
participate in both a CODA and a plan subject to
the Actual Contribution Percentage test
maintained by the Employer and the sum of the
Actual Deferral Percentage of those Highly
Compensated Employees subject to either or both
tests exceeds the aggregate limit described in
Section 4.03(c), then the Actual Contribution
Percentage of those Highly Compensated Employees
who also participate in a CODA shall be reduced
(beginning with such Highly Compensated Employee
whose Actual Contribution Percentage is the
highest) so that the limit is not exceeded. The
amount by which each Highly Compensated
Employee's Actual Contribution Percentage amounts
is reduced shall be treated as an excess
aggregate contribution. The Actual Deferral
Percentage and Actual Contribution Percentage of
the Highly Compensated Employee are determined
after any corrections required to meet the Actual
Deferral Percentage and Actual Contribution
Percentage tests. Multiple use does not occur if
either the Actual Deferral Percentage or Actual
Contribution Percentage of the Highly Compensated
Employees does not exceed 1.25 multiplied by the
Actual Deferral Percentage and Actual
Contribution Percentage of the non-Highly
Compensated Employees.
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<PAGE> 39
(2) For purposes of this section, the Actual
Contribution Percentage for any Participant who
is a Highly Compensated Employee and who is
eligible to have Actual Contribution Percentage
amounts allocated to his account under two or
more plans described in Section 401(a) of the
Code, or arrangements described in Section 401(k)
of the Code that are maintained by the Employer,
shall be determined as if the total of such
Actual Contribution Percentage amounts was made
under each plan. If a Highly Compensated
Employee participates in two or more cash or
deferred arrangements that have different plan
years, all cash or deferred arrangements ending
with or within the same calendar year shall be
treated as a single arrangement. Notwithstanding
the foregoing, certain plans shall be treated as
separate if mandatorily disaggregated under
regulations under Section 401(m) of the Code.
(3) In the event that this Plan satisfies the
requirements of Sections 401(m), 401(a)(4) or
410(b) of the Code only if aggregated with one or
more other plans, or if one or more other plans
satisfy the requirements of such sections of the
Code only if aggregated with this Plan, then this
section shall be applied by determining the
Actual Contribution Percentage of Employees as if
all such plans were a single plan. Plans may be
aggregated in order to satisfy Section 401(m) of
the Code only if they have the same Plan Year.
(4) For purposes of determining the Actual
Contribution Percentage of a Participant who is a
5% owner or one of the 10 most highly-paid Highly
Compensated Employees, the Actual Contribution
Percentage amounts and Compensation of such
Participant shall include the Actual Contribution
Percentage amounts and Compensation for the Plan
year of family members (as defined in Section
414(q)(6) of the Code). Family members, with
respect to Highly Compensated Employees, shall be
disregarded as separate employees in determining
the Actual Contribution Percentage both for
Participants who are not Highly Compensated
Employees and for Participants who are Highly
Compensated Employees.
(5) For purposes of determining the Actual
Contribution Percentage test, Matching
Contributions and qualified non-elective
contributions shall be considered made for a Plan
Year if made no later than the end of the
12-month period beginning on the day after the
close of the Plan Year.
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<PAGE> 40
(6) The Employer shall maintain records sufficient to
demonstrate satisfaction of the Actual
Contribution Percentage test and the amount of
qualified non-elective contributions used in such
test.
(7) The determination and treatment of the Actual
Contribution Percentage of any Participant shall
satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
If the Plan Administrator determines that the limitation under
this paragraph (b) has been exceeded in any Plan Year, the
following provisions shall apply:
(i) The Matching Contributions which were made on behalf of
some or all Highly Compensated Employees in the Plan
Year shall be reduced, to the extent necessary to insure
that the provisions of this Section are satisfied, by
levelling the highest percentage rates elected by the
Highly Compensated Employees. Such percentage rates
shall be rounded to the nearest one-hundredth of 1% of a
Participant's Compensation.
(ii) Any Matching Contributions subject to reduction under
this paragraph ("excess aggregate contributions"),
together with any investment earnings thereon, shall be
reduced, with the vested Matching Contributions,
together with investment earnings thereon, determined in
accordance with A-3.04 of the Adoption Agreement, being
paid to the Participant and the Matching Contributions
which are forfeitable under the Plan being forfeited and
applied to reduce Employer contributions.
(iii) Any repayment or forfeiture of excess aggregate
contributions shall be made before the close of the Plan
Year following the Plan Year for which the excess
aggregate contributions were made, and to the extent
practicable any repayment shall be made within 2 1/2
months of the close of the Plan Year in which the excess
aggregate contributions were made. If such excess
aggregate amounts are distributed more than 2 1/2 months
after the last day of the Plan Year in which such excess
aggregate amounts arose, a 10% excise tax shall be
imposed on the Employer with respect to such amounts.
Excess Aggregate Contributions of Participants who are
subject to the family member aggregation rules shall be
allocated among the family members in proportion to the
Matching Contributions (or amounts treated as Matching
Contributions) of each family member that is combined to
determine the combined Actual Contribution Percentage.
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<PAGE> 41
(c) Notwithstanding the provisions of paragraphs (a) and (b) above,
in no event shall the sum of the Actual Deferral Percentage of
the group of eligible Highly Compensated Employees and the
Actual Contribution Percentage of such group for any Plan Year
commencing on or after January 1, 1989, after applying the
provisions of paragraphs (a) and (b) above, exceed the
"aggregate limit". The aggregate limit means the greater of
(i) and (ii) where (i) is equal to the sum of (1) which is 1.25
times the greater of the relevant Actual Deferral Percentage or
the relevant Actual Contribution Percentage, and (2) which is
two percentage points plus the lesser of the relevant Actual
Deferral Percentage or the relevant Actual Contribution
Percentage, but in no event more than twice the lesser of the
relevant Actual Deferral Percentage or the relevant Actual
Contribution Percentage; and (ii) is equal to the sum of (1)
which is 1.25 times the lesser of the relevant Actual Deferral
percentage or the relevant Actual Contribution Percentage and
(2) which is two percentage points plus the greater of the
relevant Actual Deferral Percentage or the relevant Actual
Contribution Percentage, but in no event more than twice the
greater of the relevant Actual Deferral Percentage or the
relevant Actual Contribution Percentage. For purposes of this
section, the term "relevant Actual Deferral Percentage" means
the Actual Deferral Percentage of the group of non-highly
compensated employees eligible to make Elective Deferral
Contributions to the Plan during the year and the term
"relevant Actual Contribution Percentage" means the Actual
Contribution Percentage of the group of non-highly compensated
employees eligible to receive an allocation of employer
contributions deemed subject to the provisions of Section
401(m) of the Code during the year. In the event the aggregate
limit is exceeded for any Plan Year, the Actual Contribution
Percentages of the Highly Compensated Employees shall be
reduced to the extent necessary to satisfy the aggregate limit
in accordance with the procedure set forth in paragraph (b)
above.
(d) If any employee is a member of the family of (i) a 5% owner, or
(ii) a Highly Compensated Employee who is one of the 10
highest-paid Highly Compensated Employees, then the employee
shall not be counted separately but instead the Statutory
Compensation paid to, or any contribution or benefit on behalf
of that employee shall be deemed paid to or on behalf of the 5%
owner or Highly Compensated Employee for purposes of paragraphs
(a), (b) and (c) above to the extent required under regulations
prescribed by the Secretary of the Treasury under Section
401(k) and 401(m) of the Code. Any return of excess
contributions or excess aggregate contributions required under
paragraph (a), (b) or (c) above with respect to the family
group shall be made in accordance with such regulations. The
maximum
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<PAGE> 42
amount of Statutory Compensation set forth in Article 1 shall
apply to the Statutory Compensation of a Highly Compensated
Employee and his family for purposes of determining the total
benefit payable to them under the Plan. For purposes of this
section, family member includes the spouse, lineal ascendants
and descendants of the employee or former employee and the
spouses of such lineal ascendants and descendants.
(e) If any Highly Compensated Employee is a member of another
qualified plan of the Employer or an Affiliated Employer under
which elective deferral contributions or matching contributions
are made on behalf of the Highly Compensated Employee or under
which the Highly Compensated Employee makes participant
contributions, the Plan Administrator shall implement rules, as
described in Sections 4.03(a) and 4.03(b), to take into account
all such contributions for the Highly Compensated Employee
under all such plans in applying the limitations of this
Section.
(f) The Employer may authorize a special contribution to be made
for a Plan Year in accordance with the selection made in
A-4.03(f) of the Adoption Agreement. Such special contribution
shall be allocated solely to those Participants who are not
Highly Compensated Employees and shall be the amount necessary
for the Plan to meet the requirements of Section 4.03(a)
through 4.03(c). Such special contributions shall be 100%
vested and nonforfeitable when made and shall not be available
for withdrawal while the Participant is actively employed.
Special contributions made pursuant to this paragraph (f) shall
be deemed "qualified non-elective contributions". The Plan
Administrator shall establish guidelines and such rules as are
required by applicable regulations for the implementation of
this paragraph.
4.04 A Participant shall, immediately and at all times, be 100% vested in
and have a nonforfeitable right to his Elective Deferral Account, his
Participant Account, and the portion of his Employer Account
attributable to any qualified non- elective contributions made to the
Plan on his behalf, regardless of his age and service with the
Employer.
4.05 A Participant may make Elective Deferral Contributions to the Plan
regardless of the number of Hours of Service completed during the Plan
Year and whether or not employed on the last day of the Plan Year. A
Participant's entitlement to Matching Contributions and qualified
non-elective contributions for the Plan Year shall be determined in
accordance with the provisions selected in the Adoption Agreement.
4.06 Earnings attributable to Elective Deferral Contributions, Matching
Contributions and qualified non-elective
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<PAGE> 43
contributions shall be allocated in accordance with Section 3.04.
4.07 Elective Deferral Contributions and qualified non-elective
contributions, together with any investment income allocable to each,
are not distributable to a Participant or his Beneficiary earlier than
upon retirement, separation from service, death, or disability.
4.08 Such amounts may also be distributed, in accordance with the
Participant's election, upon:
(a) termination of the Plan without the establishment of a
successor plan;
(b) the disposition by a corporation to an unrelated corporation of
substantially all of the assets [within the meanings of Section
409(d)(2) of the Code] used in a trade or business of such
corporation if such corporation continues to maintain this Plan
after the disposition, but only with respect to Employees who
continue employment with the corporation acquiring such assets;
(c) the disposition by a corporation to an unrelated entity of such
corporation's interest in a subsidiary [within the meaning of
Section 409(d)(3) of the Code], if such corporation continues
to maintain this Plan, but only with respect to Employees who
continue employment with such subsidiary;
(d) the attainment of age 59 1/2 to the extent provided for in
Section A-4.08 of the Adoption Agreement; or
(e) the hardship of the Participant as described in Section 4.11
and to the extent provided in A-4.11 of the Adoption Agreement.
4.09 All distributions that may be made pursuant to one or more of the
foregoing distributable events are subject to Participant and Spousal
Consent requirements, if applicable, contained in Sections 401(a)(11)
and 417 of the Code.
4.10 In the event that Elective Deferral Contributions made under Section
4.01 are returned to the Employer in accordance with the provisions of
Sections 3.07, 3.08 or 3.03, the elections to reduce Compensation
which were made by Participants on whose behalf those contributions
were made shall be void retroactively to the beginning of the period
for which those contributions were made. The Elective Deferral
Contributions so returned shall be distributed in cash to those
Participants for whom those contributions were made, provided,
however, that the amount of Elective Deferral Contributions to be
distributed to Participants shall be adjusted to reflect any
investment gains or losses attributable to those contributions.
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<PAGE> 44
4.11 Hardship Withdrawals
(a) If elected by the Employer in Section A-4.11 of the Adoption
Agreement, a Participant may elect to withdraw his Elective
Deferral Account (including any investment earnings credited to
such Elective Deferral Account as of the end of the last Plan
Year ending before July 1, 1989); provided that any withdrawal
under this Section 4.11 shall require the furnishing of proof
of hardship satisfactory to the Plan Administrator.
(b) Hardship distributions are subject to the Spousal Consent
requirements contained in Sections 401(a)(11) and 417 of the
Code.
(c) As a condition for hardship, there must exist with respect to
the Participant an immediate and heavy need to draw upon his
Accounts where such Participant lacks other available
resources. The existence of such immediate and heavy need is
deemed to be necessary if the requested withdrawal is a result
of any of the following:
(i) to pay medical expenses described in Section 213(d) of
the Code incurred by the Participant, his spouse or any
of his dependents (as defined in Section 152 of the
Code) or as necessary for those persons to obtain
medical care described in Section 213(d) of the Code;
(ii) purchase of a principal residence of the Participant
(excluding mortgage payments);
(iii) payment of tuition and related educational fees for the
next 12 months of post-secondary education of the
Participant, his spouse or dependents; or
(iv) payment of amounts necessary to prevent eviction of the
Participant from his principal residence or to avoid
foreclosure on the mortgage of his principal residence.
A financial need shall not fail to qualify as immediate and
heavy merely because the need was reasonably foreseeable. The
Participant shall furnish to the Plan Administrator such
supporting documents as the Plan Administrator may request in
accordance with uniform and nondiscriminatory rules.
(d) As a condition for hardship withdrawal, the Participant must
demonstrate that the requested withdrawal does not exceed the
amount necessary to satisfy the financial need described in
paragraph (c) plus the amount necessary to pay any federal,
state or local income taxes or penalties reasonably anticipated
to result from the distribution. In addition, all of the
following requirements must be met:
(i) the Participant has obtained all distributions and all
nontaxable loans currently available under all plans of
the Employer and Affiliated Employers,
(ii) the Plan and all other plans of the Employer and
Affiliated Employers must provide that the
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<PAGE> 45
Participant's Elective Deferral Contributions shall be
suspended for at least 12 months after receipt of the
distribution, and
(iii) the limitation described in Section 4.01(b) under all
plans of the Employer and Affiliated Employers for the
calendar year following the year in which the withdrawal
is made must be reduced by the Participant's Elective
Deferral Contributions made in the calendar year of the
distribution for hardship. For purposes of clause (B),
"all other plans of the Employer and Affiliated
Employers" shall include stock option plans, stock
purchase plans, qualified and non-qualified deferred
compensation plans and such other plans as may be
designated under regulations issued under Section 401(k)
of the Code, but shall not include health and welfare
benefit plans or the mandatory employee contribution
portion of a defined benefit plan.
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<PAGE> 46
Article 5. Benefits
5.01 Normal Retirement
The Account of each Participant who retires on the Normal Retirement
Date specified in A-5.01 of the Adoption Agreement shall be payable as
provided in this Article. The Account of each Participant shall be
fully vested upon attainment of Normal Retirement Age.
5.02 Late Retirement
If a Participant continues employment beyond Normal Retirement Date, a
Participant may continue to participate in this Plan until actual
retirement. Upon attainment of Normal Retirement Age, a Participant
may elect to receive a distribution of his entire Account balance
prior to actual retirement. In no event shall commencement of
benefits be deferred beyond the required beginning date as described
in Section 5.08(d)(iv).
5.03 Disability Requirement
If a medical examiner selected by the Plan Administrator certifies
that a Participant is suffered a Disability as defined in Section
1.12, such Participant shall then be entitled to a disability benefit
in lieu of any other benefits provided by this Plan in accordance with
A-5.03 of the Adoption Agreement. Disability shall at all times be
determined on a uniform and consistent basis for all Participants.
5.04 Death Benefit
If a Participant dies, the Participant's Account shall be fully vested
and the Beneficiary shall receive a death benefit equal to the value
of such Account. The Plan Administrator, in its sole discretion, may
require and rely upon such proof of death and such evidence of the
right of any Beneficiary or other person to receive the value of the
Account of a deceased Participant as the Plan Administrator may deem
proper and its determination of death and the right of that
Beneficiary or other person to receive payment shall be conclusive.
5.05 Payment of Benefits
The Plan Administrator shall direct the Trustee to make payment of any
benefits provided under this Plan upon the event giving rise to such
benefit within the time prescribed by Section 5.08.
5.06 Optional Forms of Benefit
Subject to the election made by the Employer in A-5.06 of the Adoption
Agreement, the Joint and Survivor Annuity requirements of Section
5.11, and the distribution requirements of Section 5.08, optional
forms of benefit distribution are available subject to a written
request by the Participant in accordance with the provisions of this
Section.
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<PAGE> 47
The optional forms of benefits attributable to service performed on
and after the date this Plan is adopted are as follows:
(a) One single sum payment in cash or property.
(b) Life Annuity.
(c) Life Annuity with a period certain of 10 or 15 years.
(d) Joint and 50%, 66-2/3% or 100% Survivor Annuity.
(e) Any combination of the above.
(f) A direct rollover option which applies to distributions made on
or after January 1, 1993. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a distributee's
election under this Section, a distributee may elect, at the
time and in the manner prescribed by the Plan Administrator, to
have any portion of an eligible rollover distribution paid
directly to an eligible retirement plan specified by the
distributee in a direct rollover. For purposes of this Option
(f), the following terms shall be used:
(i) Eligible rollover distribution: An eligible rollover
distribution is any distribution of all or any portion
of the balance to the credit of the distributee, except
that an eligible rollover distribution does not include:
any distribution that is one of a series of
substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or
joint life expectancies) of the distributee and the
distributee's designated Beneficiary, or for a specified
period of 10 years or more; any distribution to the
extent such distribution is required under Section
401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross income
(determined without regard to the exclusion for net
unrealized appreciation with respect to employer
securities).
(ii) Eligible retirement plan: An eligible retirement plan is
an individual retirement account described in Section
408(a) of the Code, an individual retirement annuity
described in Section 408(b) of the Code, or a qualified
trust described in Section 401(a) of the Code that
accepts the distributee's eligible rollover
distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement
account or individual retirement annuity.
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<PAGE> 48
(iii) Distributee: A distributee includes an Employee or
former Employee. In addition, the Employee's or former
Employee's surviving spouse and the Employee's or former
Employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order, as
defined in Section 414(p) of the Code, are distributees
with regard to the interest of the spouse or former
spouse.
(iv) Direct rollover: A direct rollover is a payment by the
Plan to the eligible retirement plan specified by the
distributee.
For benefits attributable to service performed before the date this
Plan is adopted, the optional forms available are those listed above
plus any other forms which were available immediately prior to the
adoption date.
Any annuity contract purchased and distributed by the Plan to a
Participant or spouse shall be nontransferable, and its terms shall
comply with the requirements of this Plan.
5.07 Provisions Applicable if Plan is not Subject to Annuity Rules
The preceding Section 5.06 notwithstanding, if elected in Section
A-5.06 of the Adoption Agreement, distributions from this Plan shall
be made only in the form of a single sum payment, in cash or in
property, and a Participant may not elect to receive payments in the
form of a life annuity. If a Participant dies, the Participant's
Account balance shall be paid to the Participant's surviving spouse,
but if there is no surviving spouse, or if the surviving spouse has
given proper Spousal Consent, then the Participant's Account balance
shall be paid to the Participant's designated Beneficiary. This
"single sum only" option may be elected by the Employer only if
immediately prior to the adoption date of this Plan, no form of
distribution other than a single sum was available, (i.e., this option
may be elected only if this is a new plan, or by an existing plan
which previously permitted only single sum distributions).
5.08 Commencement of Payments
(a) Except as otherwise provided in this Article, distribution of
the Vested Portion of a Participant's Accounts shall commence
as soon as administratively practicable following the Valuation
Date coincident with or next following the Participant's
termination of employment, and in any event not later than the
60th day after the close of the Plan Year in which the latest
of the following events occurs, unless the Participant elects
otherwise:
(i) the Participant's 65th birthday,
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<PAGE> 49
(ii) the 10th anniversary of the date participation in the
Plan commenced, or
(iii) the date the Participant terminates employment.
Notwithstanding the foregoing, the failure of the Participant
and spouse to consent to a distribution while any part of the
Account balance could be distributed to the Participant (or
surviving spouse) before the Participant attains (or would have
attained if not deceased) age 62, shall be deemed to be an
election to defer commencement of any benefit sufficient to
satisfy this Section 5.08(a).
(b) In lieu of a distribution as described in paragraph (a) above,
a Participant may, in accordance with such procedures as the
Plan Administrator prescribed, elect prior to such Valuation
Date to have the distribution of the Vested Portion of his
Accounts commence as of any Valuation Date coincident with or
following his termination of employment which is before the
date described in paragraph (a) above, but subject to the
provisions of paragraph (d) below.
(c) In the case of the death of a Participant before his benefits
commence, the Vested Portion of his Accounts shall be
distributed to his Beneficiary as soon as administratively
practicable following the Valuation Date coincident with or
next following the Participant's date of death.
(d) The following provisions are effective for Plan Years beginning
after December 31, 1984:
(i) Limits on Settlement Options: Distributions, if not
made in a single sum, may be made only over one of the
following periods (or a combination thereof):
(1) the life of the Participant;
(2) the life of the Participant and a designated
Beneficiary;
(3) a period certain not extending beyond the life
expectancy of the Participant; or
(4) a period certain not extending beyond the joint
and last survivor life expectancy of the
Participant and a designated Beneficiary.
(ii) Unless otherwise elected by the Participant with proper
Spousal Consent, a married Participant's Account balance
shall be paid in the form of a Qualified Joint and
Survivor Annuity.
(iii) Determination of amount to be distributed each year:
(1) If the Participant's interest is to be paid in
the form of an annuity under the Plan, payments
under the annuity shall satisfy the following
requirements:
(A) the annuity payments must be paid in
periodic intervals not longer than one
year;
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<PAGE> 50
(B) the annuity payments must be over a life
(or lives) or over a period certain not
longer than a life expectancy (or joint
life and last survivor expectancy)
described in Section 401(a)(9)(A)(ii) or
Section 401(a)(9)(B)(iii) of the Code,
whichever is applicable;
(C) once payments under an annuity with a
period certain have begun, the period
certain may not be lengthened even if the
period certain is shorter than the maximum
permitted;
(D) payments must be nonincreasing;
(E) if the annuity is a life annuity (or a
life annuity with a period certain not
exceeding 20 years), the amount which must
be distributed on or before the
Participant's required beginning date (or,
in the case of a distribution after the
death of the Participant, the date
distributions are required to begin) shall
be the payment which is required for one
payment interval. Payment intervals are
the periods for which payments are
received, e.g., monthly, quarterly,
semi-annually or annually.
(F) Unless the Participant's spouse is the
designated beneficiary, if the
Participant's interest is being
distributed in the form of a period
certain annuity without a life
contingency, the period certain as of the
beginning of the first distribution
calendar year may not exceed the
applicable period determined using the
table set forth in Q&A A-5 of Section
1.401(a)(9)-2 of the proposed IRS
regulations.
(G) If the Participant's interest is being
distributed in the form of a joint and
survivor annuity for the joint lives of
the Participant and a nonspouse
beneficiary, annuity payments to be made
on or after the Participant's required
beginning date to the designated
beneficiary after the Participant's death
must not at any time exceed the applicable
percentage of the annuity payment for such
period that would have been payable to the
Participant using the table set forth in
Q&A A-6 of Section 1.401(a)(9)-2 of the
proposed IRS regulations.
(iv) Required Distributions: Distribution to a Participant
must commence no later than the first day of April
following the calendar year in which the Participant
attains age 70 1/2 subject to the
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<PAGE> 51
following transitional rules applicable to a
Participant who attained age 70 1/2 prior to
January 1, 1988, as determined in accordance
with (1) or (2):
(1) Non 5% owners. The required distribution date
for a Participant who is not a 5% owner is April
l of the calendar year following the calendar
year in which the later of actual retirement or
attainment of age 70 1/2 occurs.
(2) 5% owners. The required distribution date for a
Participant who is a 5% owner (as defined in
Section 416(i) of the Code) at any time during
the Plan Year in which he attains age 66 1/2 or
subsequent Plan Year is the April l following the
later of:
(A) the calendar year in which he attains age
70 1/2; or
(B) the earlier of the calendar year with or
within which the Plan Year ends where the
Participant becomes a 5% owner or the
calendar year in which the Participant
retires.
(v) Death Distribution Provisions: Upon the death of the
Participant, the following distribution provisions shall
take effect:
(1) If the Participant dies after distribution of his
interest has commenced, the remaining portion of
such interest shall continue to be distributed at
least as rapidly as under the method of
distribution in effect prior to the Participant's
death.
(2) If the Participant dies before distribution of
his interest commences, the Participant's entire
interest shall be distributed no later than
December 31 of the calendar year containing the
fifth anniversary of the Participant's death,
except to the extent that an election is made to
receive distributions in accordance with (A) or
(B) below:
(A) if any portion of the Participant's
interest is payable to a designated
Beneficiary, distributions may be made in
substantially equal installments over the
life or life expectancy of the designated
Beneficiary, commencing on or before
December 31 of the calendar year
immediately following the calendar year in
which the Participant died;
(B) if the designated Beneficiary is the
Participant's surviving spouse, the date
by which distributions under (i) above are
required to begin shall not be earlier
than the later of December 31 of the
calendar
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<PAGE> 52
year immediately following the calendar
year in which the Participant died or
December 31 of the calendar year in which
the Participant would have attained age 70
1/2; and, if the spouse dies before
payments begin, subsequent distributions
shall be made as if the spouse had been the
Participant.
5.09 Termination of Service
(a) Termination of service, except for death, normal retirement,
late retirement or disability retirement, qualifies the
Participant for the Vested Portion of the Account balance as of
the date of termination. The portion of the Participant's
Account balance which is vested is determined by the vesting
schedule and the years of Vesting Service the Participant has
been credited with as of the termination date.
(b) All years of Vesting Service, as described in Section 1.39, of
the Participant with the Employer (or under a predecessor plan,
if the obligations of the predecessor plan have been assumed by
the Employer) shall be taken into account in determining the
Participant's place on the vesting schedule designated in the
Adoption Agreement.
(c) If there is a change in the Plan Year and years of Eligibility
and/or Vesting Service are based on such Plan Year, a
Participant shall be credited with a year of Eligibility and/or
a Vesting Service for both the Plan Year as it was prior to the
amendment (as if there was no change) and the first Plan Year
after the amendment if the Participant has at least 1,000 Hours
of Service in each of those Plan Years.
(d) The Vested Portion of a Participant's Account balance shall be
available for distribution in accordance with the selection in
the Adoption Agreement.
(i) In the event of a deferred distribution, payment of the
Vested Portion shall commence no later than the time
prescribed by Section 5.08. If the Participant should
die after termination of employment, but before
receiving a distribution of the Vested Portion, the
Beneficiary shall receive the death benefit, if any, as
provided in Section 5.04. Payments shall be made under
an arrangement provided for in this Article and shall be
subject to the requirements of Section 5.11.
(ii) In the event of an immediate distribution, the Vested
Portion shall be distributed under an arrangement
provided for in this Article and shall be subject to the
requirements of Section 5.11.
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<PAGE> 53
(e) Any forfeitures shall be a general asset of the Plan and shall
be handled in accordance with Section 3.06. A forfeiture shall
occur on the earlier of:
(i) the distribution of the entire Vested Portion of a
Participant's Account; or
(ii) the last day of the Plan Year in which the Participant
incurs five consecutive one-year Breaks in Service.
(f) Upon termination of employment of a Participant who was not
fully vested in his Employer Account, the non-vested portion of
his Employer Account shall be segregated in a separate account
(which shall be invested in a manner designed to preserve
principal value and shall not participate in the earnings or
losses of the investment fund) until the Participant has had
five consecutive one-year Breaks in Service or receives a
distribution of the Vested Portion of his Accounts, if earlier.
If the former Participant is reemployed by the Employer or an
Affiliated Employer prior to such time, the separate account
shall be recredited as the Participant's Employer Account. If
the former Participant is not reemployed by the Employer or an
Affiliated Employer before he has had five consecutive one-year
Breaks in Service or receives such a distribution; the
non-vested portion of his Employer Account, so segregated,
shall be forfeited. Any amounts forfeited pursuant to this
paragraph (f) shall be applied to reduce Employer
contributions. If a Participant is not vested in any portion
of his Employer Account, such Employer Account shall be deemed
to have been distributed as of the date of distribution of the
Vested Portion of his Accounts.
(g) If an amount of a Participant's Employer Account has been
forfeited or is held in a separate account in accordance with
paragraph (f) above, that amount shall be subsequently restored
to the Participant's Employer Account provided (i) he is
reemployed by the Employer or an Affiliated Employer before he
has had five consecutive one-year Breaks in Service and (ii) he
repays to the Plan an amount in cash equal to the full amount
distributed to him from the Plan as a result of his termination
of employment.
(h) In the event that any amounts to be restored by the Employer to
a Participant's Employer Account have been forfeited under
paragraph (f) above, those amounts shall be taken first from
any forfeitures which have not as yet been applied against
Employer contributions and if any amounts remain to be
restored, the Employer shall make an Employer contribution
equal to those amounts.
(i) Any repayment under this Section 5.09 must be made by the
Participant in a single sum within five years of the date he is
reemployed.
(j) If the Vested Portion of a Participant's Account balance
exceeds (or at the time of any prior distribution
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<PAGE> 54
exceeded) $3,500, and the Account balance is immediately
distributable, the Participant and the Participant's spouse (or
where either the Participant or the spouse has died, the
survivor) must consent to any distribution of such Account
balance. The consent of the Participant and the Participant's
spouse shall be obtained in writing within the 90-day period
ending on the Annuity Starting Date. The Annuity Starting Date
is the first day of the first period for which an amount is paid
as an annuity or any other form. The Plan Administrator shall
notify the Participant and the Participant's spouse of the right
to defer any distribution until the Participant's Account
balance is no longer immediately distributable. Such
notification shall include a general description of the material
features, and an explanation of the relative values of the
optional forms of benefit available under the Plan in a manner
that would satisfy the notice requirements of Section 417(a)(3),
and shall be provided no less than 30 days and no more than 90
days prior to the Annuity Starting Date.
(k) Notwithstanding the foregoing, only the Participant need
consent to the commencement of a distribution in the form of a
Qualified Joint and Survivor Annuity while the Account Balance
is immediately distributable. Furthermore, if payment in the
form of a Qualified Joint and Survivor Annuity is not required
with respect to the Participant pursuant to Section 5.07 of the
Plan, only the Participant need consent to the distribution of
an Account balance that is immediately distributable. Neither
the consent of the Participant nor the Participant's spouse
shall be required to the extent that a distribution is required
to satisfy Section 401(a)(9) or Section 415 of the Code. In
addition, upon termination of this Plan if the Plan does not
offer an annuity option (purchased from a commercial provider),
the Participant's Account balance may, without the
Participant's consent, be distributed to the Participant or
transferred to another defined contribution plan (other than an
employee stock ownership plan as defined in Section 4975(e)(7)
of the Code) within the same controlled group.
(l) An Account balance is immediately distributable if any part of
the Account balance could be distributed to the Participant (or
Surviving Spouse) before the Participant attains (or would have
attained if not deceased) the later of Normal Retirement Age or
age 62.
(m) Notwithstanding any other provision of the Plan, a single sum
payment shall be made in lieu of all vested benefits if the
value of the Vested Portion of the Participant's Accounts never
exceeded $3,500, and if the balance of the Participant's
Account never exceeded $3,500 as of any previous distribution.
The single sum payment shall be made as soon as
administratively practicable following the
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<PAGE> 55
Valuation Date coincident with or next following the
Participant's termination of employment.
(n) Forfeiture of benefits:
(i) If a retirement benefit becomes payable under this Plan
to a Participant (or his Beneficiary) and such
retirement benefit remains unpaid for a period of five
years from the date such retirement benefit first became
payable because the Participant (or his Beneficiary)
cannot be located, the retirement benefit shall be
deemed to be a forfeiture under the Plan and shall be
used to reduce future Employer contributions to the Plan
as soon as practicable after the deemed forfeiture.
(ii) Anything in this Section 5.09 to the contrary
notwithstanding, if a retirement benefit is forfeited
under the provisions of Section 5.09(n)(i) and the
Participant (or his Beneficiary) is located, the
retirement benefit shall be reinstated and paid to the
Participant (or his Beneficiary) under the terms of this
Plan. The Employer shall make up any loss to the Plan
as a result of the reinstatement of a retirement benefit
as soon as practicable thereafter.
5.10 Status of Account Pending Distribution
Until completely distributed, the Accounts of a Participant who is
entitled to a distribution shall continue to be invested as part of
the investment funds of the Plan.
5.11 Joint and Survivor Annuity Requirements
=======================================================================
THE PROVISIONS OF THIS SECTION 5.11 SHALL TAKE PRECEDENCE OVER ANY
CONFLICTING PROVISION IN THE PLAN AND SHALL APPLY TO ANY PARTICIPANT
WHO IS CREDITED WITH AT LEAST ONE HOUR OF SERVICE WITH THE EMPLOYER
ON OR AFTER AUGUST 23, 1984, AND SUCH OTHER PARTICIPANTS AS PROVIDED
IN SECTION 5.11.
=======================================================================
(a) Qualified Joint and Survivor Annuity:
Unless an optional form of benefit is selected pursuant to a
Qualified Election within the 90-day period ending on the
Annuity Starting Date, the Vested Portion of a married
Participant's Account balance shall be paid in the form of a
Qualified Joint and Survivor Annuity and the Vested Portion of
an unmarried Participant's Account balance shall be paid in the
form of a life annuity. The Participant may elect to have such
annuity distributed upon attainment of the earliest retirement
age under the Plan.
(b) Qualified Preretirement Survivor Annuity:
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<PAGE> 56
Unless an optional form of benefit has been selected within the
Election Period pursuant to a Qualified Election, if a
Participant dies before the Annuity Starting Date, the
Participant's total Account balance shall be applied toward the
purchase of an annuity for the life of the surviving spouse.
The surviving spouse may elect to have such annuity distributed
within a reasonable period after the Participant's death.
(c) Notice Requirements:
In the case of a Qualified Joint and Survivor Annuity, the Plan
Administrator shall, no less than 30 days and no more than 90
days prior to the Annuity Starting Date, provide each
Participant a written explanation of:
(i) the terms and conditions of a Qualified Joint and
Survivor Annuity; and
(ii) the Participant's right to make, and the effect of, an
election to waive the Qualified Joint and Survivor
Annuity form of benefit; and
(iii) the rights of a Participant's Spouse; and
(iv) the right to make, and the effect of, a revocation of a
previous election to waive the Qualified Joint and
Survivor Annuity.
In the case of a Qualified Preretirement Survivor Annuity as
described in Section 5.11(b), the Plan Administrator shall
provide each Participant within the applicable period for such
Participant, a written explanation of the Qualified
Preretirement Survivor Annuity in such terms and in such manner
as would be comparable to the explanation provided for meeting
the requirements of Section 5.11(a) applicable to a Qualified
Joint and Survivor Annuity. The applicable period for a
Participant is whichever of the following periods ends last:
(i) The period beginning with the first day of the Plan Year
in which the Participant attains age 32 and ending with
the close of the Plan Year in which the Participant
attains age 35.
(ii) A reasonable period ending after the individual becomes
a Participant.
(iii) A reasonable period ending after Section 5.11(d) ceases
to apply to the Participant.
(iv) A reasonable period ending after this Section 5.11 first
applies to the Participant.
Notwithstanding the foregoing, notice must be provided within a
reasonable period ending after separation from service in the
case of a Participant who separates from service before
attaining age 35.
For purposes of applying the preceding paragraph, a reasonable
period ending after the enumerated events described in (ii),
(iii), and (iv) is the end of the two-year period beginning one
year prior to the date the applicable event occurs, and ending
one year after that
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<PAGE> 57
date. In the case of a Participant who separates from service
before the Plan Year in which age 35 is attained, notice shall
be provided within the two-year period beginning one year prior
to separation and ending one year after separation. If such a
Participant thereafter returns to employment with the Employer,
the applicable period for such Participant shall be
redetermined.
(d) Notwithstanding the other requirements of this Section 5.11,
the respective notices prescribed by this Section need not be
given to a Participant if:
(i) the Plan "fully subsidized" the costs of a Qualified
Joint and Survivor Annuity or Qualified Preretirement
Survivor Annuity; and
(ii) the Plan does not allow the Participant to waive the
Qualified Joint and Survivor Annuity or Qualified
Preretirement Survivor Annuity and does not allow a
married Participant to designate a nonspouse
Beneficiary.
For purposes of this Section 5.11(d), a Plan fully subsidizes
the costs of a benefit if no increase in cost, or decrease in
benefits to the Participant may result from the Participant's
failure to elect another benefit.
(e) Transitional Rules:
(i) Any living Participant not receiving benefits on August
23, 1984 who would otherwise not receive the benefits
prescribed by the previous paragraphs of this Section
5.11 must be given the opportunity to elect to have such
prior paragraphs of this Section 5.11 apply if such
Participant is credited with at least one Hour of
Service under this Plan or a predecessor plan in a Plan
Year beginning on or after January 1, 1976 and such
Participant had at least 10 years of Vesting Service
when he separated from service.
(ii) Any living Participant not receiving benefits on August
23, 1984 who was credited with at least one Hour of
Service under this Plan or a predecessor plan on or
after September 2, 1974, and who is not otherwise
credited with any Service in a Plan Year beginning on or
after January 1, 1976 must be given the opportunity to
elect to have his benefit paid in accordance with
Section 5.11(e)(iv).
(iii) The respective opportunities to elect [as described in
Sections 5.11(e)(i) and (ii) above] must be afforded to
the appropriate Participants during the period
commencing on August 23, 1984, and ending on the date
benefits would otherwise commence to said Participants.
(iv) Any Participant who has made an election pursuant to
Section 5.11(e)(ii) and any Participant who does not
make the election under Section 5.11(e)(i) or who meets
the requirements of
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<PAGE> 58
Section 5.11(e)(i) except that such Participant did not
have at least 10 years of Vesting Service when he
separated from service, shall have his benefits
distributed in accordance with all of the following
requirements if benefits would have been payable in the
form of a life annuity:
(A) Automatic Joint and Survivor Annuity: If
benefits in the form of a life annuity become
payable to a married Participant who:
(1) begins to receive payments under the Plan
on or after Normal Retirement Age; or
(2) dies on or after Normal Retirement Age
while still working for the Employer; or
(3) begins to receive payments on or after the
qualified early retirement age; or
(4) separated from Service on or after
attaining Normal Retirement Age (or the
qualified early retirement age) and after
satisfying the eligibility requirements
for the payment of benefits under the Plan
and thereafter dies before beginning to
receive such benefits, then such benefits
shall be paid in the form of a Qualified
Joint and Survivor Annuity, unless the
Participant has elected otherwise during
the election period. The election period
must begin at least six months before the
Participant attains qualified early
retirement age and end not more than 90
days before the commencement of benefits.
Any election hereunder shall be in writing
and may be changed by the Participant at
any time.
(B) Election of Early Survivor Annuity: A
Participant who is employed after attaining the
qualified early retirement age shall be given the
opportunity to elect, during the election period,
to have a survivor annuity payable on death. If
the Participant elects a survivor annuity,
payments under such annuity must not be less than
the payments which would have been made to the
spouse under the Qualified Joint and Survivor
Annuity if the Participant had retired on the day
before his or her death. Any election under the
provision shall be in writing and may be changed
by the Participant at any time. The election
period begins on the later of:
(1) the 90th day before the Participant
attains the qualified early retirement
age; or
(2) the date participation began.
The election period ends on the date the
Participant terminates employment.
(C) For purposes of this Section
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<PAGE> 59
(1) "Qualified early retirement age" is the
latest of:
- the earliest date, under the Plan,
that the participant may elect to
receive retirement benefits; or
- the first day of the 120th month
beginning before the Participant
reaches Normal Retirement Age; or
- the date the Participant begins
participation.
(2) "Qualified Joint and Survivor Annuity" is
an annuity for the life of the Participant
with a survivor annuity for the life of
the spouse.
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<PAGE> 60
Article 6. Administration of the Plan
6.01 Appointment of Plan Administrator
The Employer shall be designated as the official Plan Administrator
unless otherwise elected in the Adoption Agreement. Irrespective of
this official designation, the general administration of the Plan and
the responsibility for carrying out the provisions of the Plan may be
placed in a committee appointed by the Employer through its Board of
Directors; if applicable, to serve at the pleasure of the Employer. Any
person who is appointed a member of the committee shall signify his
acceptance by filing written acceptance with the Employer and the
secretary of the committee. Any member of the committee may resign by
delivering his written resignation to the Employer and the secretary of
the committee.
6.02 Duties of Plan Administrator
At the direction of the Employer, the members of the committee shall
elect a chairman from their number and a secretary who may be, but need
not be, one of the members of the committee; may appoint from their
number such subcommittees with such powers as they shall determine; may
authorize one or more of their number or any agent to execute or
deliver any instrument or make any payment on their behalf; may retain
counsel, employ agents and provide for such clerical, accounting, and
consulting services as they may require in carrying out the provisions
of the Plan; and may allocate among themselves or delegate to other
persons all or such portion of their duties under the Plan, other than
those granted to the Trustees under the trust agreement adopted for use
in implementing the Plan, as they, in their sole discretion, shall
decide.
The committee shall have all powers, authority and discretion necessary
to carry out the provisions of the Plan and to satisfy the requirements
of any applicable law or laws. The committee shall have full power,
authority and discretion to:
(a) construe and interpret the Plan, decide all questions of
eligibility, and determine the amount, timing, and manner of
payment of any benefits hereunder;
(b) prescribe procedures to be followed by Participants and/or other
persons in filing applications or elections;
(c) prepare and distribute, in such manner as may be required by
law or as the committee deems appropriate, information
explaining the Plan; and
(d) require from the Employer and Participants such information as
shall be necessary for the proper administration of the Plan.
Decisions of the committee shall be binding on all affected parties.
6.03 Individual Accounts
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<PAGE> 61
The committee shall maintain, or cause to be maintained, records
showing the individual balances in each Participant's Accounts.
However, maintenance of those records and Accounts shall not require
any segregation of the funds of the Plan.
6.04 Meetings
The committee shall hold meetings upon such notice, at such place or
places, and at such time or times as it may from time to time
determine.
6.05 Action of Majority
Any act which the Plan authorizes or requires the committee to do may
be done by a majority of its members. The action of that majority
expressed from time to time by a vote at a meeting or in writing
without a meeting shall constitute the action of the committee and
shall have the same effect for all purposes as if assented to by all
members of the committee at the time in office.
6.06 Compensation and Bonding
No member of the committee shall receive any compensation from the Plan
for his services as such. Except as may otherwise be required by law,
no bond or other security need be required of any member in that
capacity in any jurisdiction.
6.07 Establishment of Rules
Subject to the limitations of the Plan, the committee from time to time
shall establish rules for the administration of the Plan and the
transaction of its business. The determination of the committee as to
any disputed question shall be conclusive.
6.08 Prudent Conduct
The members of the committee shall use that degree of care, skill,
prudence and diligence that a prudent man acting in a like capacity and
familiar with such matters would use in his conduct of a similar
situation. No member of the committee shall participate in the
consideration of any manner or questions under the Plan which
specifically relates to him or other persons entitled to benefit
payments as a result of the committee member's participation under the
Plan.
6.09 Service in More Than One Fiduciary Capacity
Any individual, entity or group of persons may serve in more than one
fiduciary capacity with respect to the Plan and/or the funds of the
Plan.
6.10 Limitation of Liability
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<PAGE> 62
The Employer, the Board of Directors, if any, the members of the
committee, and any officer, employee or agent of the Employer shall not
incur any liability individually or on behalf of any other individuals
or on behalf of the Employer for any act or failure to act, made in
good faith in relation to the Plan or the funds of the Plan. However,
this limitation shall not act to relieve any such individual or the
Employer from a responsibility or liability for any fiduciary
responsibility, obligation or duty under Part 4, Title I of ERISA.
6.11 Indemnification
The Employer shall indemnify and save harmless the Board of Directors,
if any, and the committee and each member thereof, against any and all
expenses, losses, damages, liabilities and claims, including legal fees
to defend against such liabilities and claims, arising out of their
discharge in good faith of responsibilities under or incident to the
Plan, excepting only expenses, losses, damages and liabilities arising
out of willful misconduct. This indemnity shall not preclude such
further indemnities as may be available under insurance purchased by
the Employer or provided by the Employer under any by-law, agreement,
vote of stockholders or disinterested directors or otherwise, as such
indemnities are permitted under state law. Payments with respect to any
indemnity and payment or expenses or fees under this Article 6 shall be
made only from assets of the Employer and shall not be made directly or
indirectly from assets of the Trust.
6.12 Appointment of Investment Manager
The Employer may, in its discretion, appoint one or more investment
managers (within the meaning of Section 3(38) of ERISA) to manage
(including the power to acquire and dispose of) all or part of the
assets of the Plan, as the Employer shall designate. In that event
authority over and responsibility for the management of the assets so
designated shall be the sole responsibility of that investment manager.
6.13 Review of Applications for Benefits
(a) When a Participant or other person files an application for a
benefit payment with the committee, the committee shall review
the application and make a determination of eligibility for any
amount of benefit due a Participant or such other person. If
an application is wholly or partially denied, the committee
shall give written notice of the denial to the Participant or
other person applying (hereinafter referred to in this Section
as the "claimant") within 90 days after receipt of the claim,
unless special circumstances require an extension of not more
than an additional 90 days (in which event the claimant shall
be notified of the delay during the first 90-day period). Such
notice shall set forth:
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<PAGE> 63
(i) the specific reason or reasons for the denial, with
references to the specific Plan provisions on which the
denial is based,
(ii) an explanation of additional material or information, if
any, necessary to perfect any claim and a statement of
why such material or information is necessary, and
(iii) an explanation of the review procedure.
If the notice of denial is not furnished within the required time
period specified above, the claim shall be deemed to be denied and
the claimant shall be permitted to proceed to the review stage
described in paragraphs (b) and (c) below.
(b) In the event an application for benefits is denied by the
committee, either in whole or in part as to the payment of
benefits or amounts, the claimant shall have the right to
request a full and fair committee review of the denial. Such
request must be made in writing and delivered to the committee
within 60 days of receipt of the written notice of claim denial
or 60 days after the day on which the claim is deemed denied
under paragraph (a) above.
(c) In such review, the claimant or his duly authorized
representative shall have the right to review any pertinent
documents and to submit any issues or comments in writing. The
committee shall submit its decision in writing within 60 days
after the request for review, or in special circumstances (such
as where the committee in its sole discretion finds there is a
need to hold a hearing) within 120 days of the request for
review (written notice of any such extension shall be furnished
to the claimant before the commencement of such extension).
The decision shall be binding on all parties and shall contain
specific reasons for the decision and specific references to
the pertinent Plan provisions upon which the decision is based.
If no decision is furnished within the time period specified
above, the claim shall be deemed to be denied on review.
(d) Notices of denial and decisions on review shall be as complete
as possible, but in no event shall be construed to bar the
subsequent raising of additional bases of denial or decisions.
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<PAGE> 64
Article 7. Management of Funds
7.01 Trustees
All the funds of the Plan shall be held by the Trustees appointed from
time to time by the Board of Directors, if applicable. The Employer
shall have no liability for the payment of benefits under the Plan nor
for the administration of the funds paid over to the Trustees. The
Trustees shall have all the powers necessary to carry out the
provisions hereunder. In amplification, but not in limitation of such
powers, the Trustees shall have the following powers and immunities and
be subject to the following duties:
(a) The Trustees shall receive all contributions hereunder and apply
such contributions as hereinafter set forth.
(b) The Trustees shall have the custody of and safely keep all cash,
securities, property and investments received or purchased in
accordance with the terms hereof.
(c) Subject to any limitations that may be contained elsewhere in
this Plan, the Trustees shall take control and management of
the trust and shall hold, sell, buy, exchange, invest and
reinvest the corpus and income of the trust. All contributions
paid to the Trustees shall be held and administered by the
Trustees as a single trust fund, and the Trustees shall not be
required to segregate and invest separately any part of the
trust fund representing accruals of interests of individual
Participants in the Plan except as may be elected by the
Participant elections, if any, permitted in accordance with the
provisions of Section 3.11.
(d) Subject to the limitations contained herein, the Trustees may
invest the funds of the trust in such securities and properties
as they may determine and shall not be restricted by any
applicable laws prescribing forms of property which may be held
or acquired by a Trustee. Subject to the limitations contained
in Section 407 of the ERISA and the other limitations expressed
herein, the Trustees may invest funds of the trust in the
common or preferred stock, securities, or other secured
obligations of the Employer. All such purchases shall be
disclosed in full detail to the Internal Revenue Service.
Without limiting the generality of any other provisions hereof,
it is expressly provided that the trust fund may be invested in
a common trust fund maintained by the Trustees.
(e) The Trustees may sell or exchange any property or asset of the
trust at public or private sale, with or without advertisement,
upon terms acceptable to the Trustees and in such manner as the
Trustees may deem wise and proper. The proceeds of any such
sale or exchange may be reinvested as is provided hereunder.
The purchaser of any such property from the Trustees shall not
be required to look to the application of the proceeds of any
such sale or exchange by the Trustees.
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<PAGE> 65
(f) The Trustees shall have full power to mortgage, pledge, lease
or otherwise dispose of the property of the trust without
securing any order of court therefor, without advertisement,
and to execute any instruments containing any provisions which
the Trustees may deem proper in order to carry out such
actions. Any such lease so made by the Trustees shall be
binding, notwithstanding the fact the term of the lease may
extend beyond the termination of the trust.
(g) The Trustees shall have the power to borrow money upon terms
agreeable to the Trustees and pay interest thereon at rates
agreeable to the Trustees, and to repay any debts so created.
(h) The Trustees may participate in the reorganization,
recapitalization, merger, or consolidation of any corporation
wherein the Trustees may own stock or securities and may
deposit such stock or other securities in any voting trust or
protective committee or like committee or Trustees or with the
depositories designated thereby, and may exercise any
subscription rights or conversion privileges, and generally may
exercise any of the powers of any owner with respect to any
stock or other securities or property comprising the trust.
(i) The Trustees may, through any duly authorized officer or proxy,
vote any share of stock which the Trustees may own from time to
time.
(j) The Trustees shall retain in cash and keep unproductive of
income such funds as from time to time they may deem advisable.
The Trustees shall not be required to pay interest on any cash
in their hands pending investment, nor shall the Trustees be
responsible for the adequacies of the trust to discharge any
and all payments under this Agreement. Cash received under any
of the provisions hereof may be deposited by the Trustees in
such banking institutions as may be selected by the Trustees,
under such provisions with respect to interest as may be
permitted by law. For the purposes of this Section, the word
"accounts" shall be construed to mean not only demand deposit
accounts, but also savings accounts and time deposits accounts
without regard as to whether the amount on deposits is
evidenced by a statement, passbook or certificate. All persons
dealing with the Trustees are released from inquiry into the
decision or authority of the Trustees to act.
(k) The Trustees shall be fully protected in relying upon the
existence of any fact or set of facts represented to them in
writing by the Employer.
(l) The Trustees shall discharge their duties hereunder with the
care, skill, prudence and diligence under the circumstances then
prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an
enterprise of a like character and
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<PAGE> 66
with the like aims and shall diversify the investments under
this Trust so as to minimize the risk of large losses, unless
under the circumstances it is clearly prudent not to do so. The
Trustees shall comply with any funding policy established in
writing by the Employer, but the Trustees shall be solely
responsible [except as provided in Section 7.01(u)] for the
selection and retention or non-retention of the investments to
fulfill such funding policy.
(m) The Trustees shall not be required to institute any legal action
for the protection of the Trust or in carrying out the duties of
the Trustees hereunder unless they shall first be indemnified by
the Employer for any and all expenses in connection therewith.
(n) The Trustees shall keep an accurate record of their
administration of this Trust and shall include a detailed
account of all investments, receipts and disbursements, and
other transactions hereunder, and all accounts, books and
records relating hereto shall be open for inspection to any
person designated by the Employer, or the officers of the
Employer at all reasonable times. Within 90 days following the
close of each year, the Trustees shall file with the Employer,
a written report setting forth all investments, receipts and
disbursements and other transactions during such fiscal year.
Such reports shall contain an exact description of all
securities purchased, exchanged or sold, the cost of net
proceeds of sale, and list the securities and investments held
at the end of such year, with the cost of each item thereof, as
carried on the books of the Trustees.
(o) The Trustees may hold stocks, bonds, or other securities in
their own name as Trustees, with or without the designation of
said trust estate, or in the name of a nominee selected by them
for the purpose, but said Trustees shall nevertheless be
obligated to account for all securities received by them as a
part of the corpus of the trust estate herein created,
notwithstanding the name in which the same may be held.
(p) The Trustees shall be under no obligation to determine the
amount of benefits to which Participants or their Beneficiaries
will be entitled or to keep any records of the respective
interest of any individual Participant or Beneficiary in the
Plan. The Trustees, upon written instructions from the
Employer shall make payments to the Participants who qualify
for such benefits and shall purchase, transfer, discontinue or
surrender insurance contracts. The Trustees shall have no
liability to the Employer, or to any other person in making
such payments. The Trustees shall not be required to determine
or make any investigation to determine the identity or mailing
address of any person entitled to benefits under the Plan and
shall have discharged their obligation in that respect
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<PAGE> 67
when they shall have sent checks and other papers by ordinary
mail to such person or persons and addresses as may be certified
to them in writing by the Employer.
(q) No broker, transfer agent, or purchaser shall be required to
ascertain whether or not the Trustees have obtained prior
approval from any source for the sale or purchase of any of the
assets of the Trust.
(r) At no time during the administration of this Trust shall the
Trustees be required to obtain any court approval of any act
required of them in connection with the performance of their
duties or in the performance of any act required of them, in
the administration of their duties as Trustees. The Trustees
shall have full authority to exercise their judgment in all
matters and at all times without court approval of such
decisions; provided, however, that if any application to or
proceeding or action in the courts is made, only the Employer
and the Trustees shall be necessary parties, and no Participant
in the Plan or other person having an interest in the trust
shall be entitled to any notice or service of process. Any
judgment entered in such proceeding or action shall be
conclusive upon all persons claiming an interest under the
trust.
(s) The Trustees may consult with legal counsel (who may be of
counsel to the Employer) concerning any question which may arise
with reference to their duties under this agreement, and the
option of such counsel shall be full and complete protection in
respect to any action taken or suffered by the Trustees
hereunder in good faith and in accordance with the opinion of
such counsel.
(t) The Trustees may employ such counsel, accountants, and other
agents as they shall deem advisable. The Trustees may charge the
compensation of such counsel, accountants and other agents for
their services in such amounts as may be agreed upon from time
to time by the Employer and the Trustees, and any other expenses
necessary in the administration of this trust, against the fund.
(u) The Trustees with the consent of the Employer may employ an
investment manager or managers to manage any assets of the
Plan. Without limiting the generality of the above, it is
specifically provided that such power of management includes
the power to acquire or dispose of said assets. The Employer
may appoint an investment manager or managers to manage any
assets of the Plan. In either such event, the responsibility
for investment decisions shall be clearly allocated in writing
between the investment manager and the Trustees and neither
shall be responsible for the action or inaction of the other.
7.02 A Trustee may be removed by the Board of Directors, if any, of the
Employer at any time upon giving advance notice in writing to the
Trustees. A Trustee may resign at any time upon giving
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advance notice in writing to the Employer. Within 60 days after such
removal or resignation of a Trustee, the Trustee shall file with the
Employer, a written report setting forth all investments, receipts, and
disbursements, and other transactions effected by him since the end of
the preceding fiscal year. Such report shall contain an exact
description of all securities and property purchased and sold, the cost
or net proceeds of sale (excluding accrued interest paid or received)
and shall further indicate such assets held to such date of removal or
resignation, together with the cost of each item thereof, as carried on
the books of the Trustees.
7.03 Immediately upon the removal or resignation of a Trustee, the Board of
Directors of the Employer shall appoint and designate a new Trustee
with the same powers and duties as those conferred upon the Trustee
hereunder, and the former Trustee shall assign, transfer and pay to the
successor Trustee the assets then constituting the Trust hereunder.
7.04 Except as otherwise provided in the Plan, no part of the corpus or
income of the funds of the Plan shall be used for, or diverted to,
purposes other than for the exclusive benefit of Participants and
other persons entitled to benefits under the Plan or for the payment
of reasonable administrative expenses not paid by the Employer. No
person shall have any interest in or right to any part of the earnings
of the funds of the Plan, or any right in, or to, any part of the
assets held under the Plan, except as and to the extent expressly
provided in the Plan.
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Article 8. Top-Heavy Provisions
======================================================================
IN THE EVENT THE PLAN IS, OR BECOMES TOP-HEAVY, THE PROVISIONS OF THIS
ARTICLE 8 SHALL SUPERSEDE ANY CONFLICTING PROVISION IN THE PLAN OR
ADOPTION AGREEMENT.
======================================================================
8.01 The term "top-heavy plan" means with respect to any Plan Year
commencing subsequent to December 31, 1983, a plan, in which, as of
the "determination date" (which for the first Plan Year is the last
day of that Plan Year and for subsequent Plan Years is the last day of
the preceding Plan Year) the cumulative Account balances, as of the
valuation date (which is the last day of the current Plan Year) under
the Plan for "key employees" exceeds 60% of the cumulative Account
balances for all employees. The value of Account balances shall be
computed in accordance with Section 416(g) of the Code and Article 3
of this Plan.
8.02 For purposes of this Article 8, the term "key employee" means an
employee, former employee or the Beneficiary of an employee of the
Employer or an Affiliated Employer who, at any time during the Plan
Year, or any time during the four preceding Plan Years, is (or was):
(a) an officer of the Employer or an Affiliated Employer earning
Statutory Compensation in excess of 50% of the maximum dollar
limitation on benefits under Section 415(b)(1)(A) of the Code,
as in effect for that Plan Year. (No more than three employees,
or 10% of all employees if there are more than 30, shall be
counted as "officers" for purposes of this Section);
(b) an employee earning Statutory Compensation in excess of 100% of
the maximum dollar limitation on annual additions under Section
415(c)(1)(A) of the Code, as in effect for that Plan Year, and
who is also one of the ten largest owners of the Employer or an
Affiliated Employer (either directly or through the attribution
rules under Section 318 of the Code) provided that such
ownership interest is equal to at least one-half of 1%;
(c) a 5% owner of the Employer; or
(d) a 1% owner of the Employer earning Statutory Compensation in
excess of $150,000.
The term "non-key employee" means any employee who is not a key
employee or the Beneficiary of such employee.
8.03 For Aggregated Plans, each plan of an Employer or an Affiliated
Employer required to be included in an "aggregation group" shall be
treated as a top-heavy plan if such group is a "top-heavy group".
(a) Aggregation Group -
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<PAGE> 70
(i) Required Aggregation - The term "aggregation group" means
(A) each plan of the Employer and Affiliated
Employers, including any plan which has terminated
during the five- year period preceding a
determination date, in which a key employee is a
Participant, and
(B) each other plan of the Employer and Affiliated
Employers which enables any plan described in
subclause (A) to meet the requirements of Section
401(a)(4) or 410 of the Code.
(ii) Permissive Aggregation - The Employer may treat any plan
not required to be included in an aggregation group under
clause (i) as being part of such group if such group
would continue to meet the requirements of Sections
401(a)(4) and 410 of the Code with such plan taken into
account.
(b) Top-Heavy Group - The term "top-heavy group" means any
aggregation group, if the sum, as of the determination date, of
subsections (i) and (ii) exceeds 60% of a similar sum determined
for all employees. Subsections (i) and (ii) are as follows:
(i) The Present Value of the cumulative accrued benefits for
key employees under all defined benefit plans included
in such group, and
(ii) The aggregate of the accounts of key employees under all
defined contribution plans included in such group.
(c) Top-Heavy Ratio Provision - For Plan Years beginning after
December 31, 1984;
(i) If the Employer maintains one or more defined benefit
plans and has not maintained any defined contribution
plans (including any simplified employee pension plan)
which during the five-year period ending on the
determination date(s) has or has had account balances,
the top-heavy ratio for this plan alone or for the
required or permissive aggregation group as appropriate
is a fraction, the numerator of which is the sum of the
Present Value of accrued benefits of all key employees
as of the determination date(s) (including any part of
any accrued benefit distributed in the five-year period
ending on the determination date(s)), and the
denominator of which is the sum of the Present Value of
accrued benefits for all Participants in the plan(s)
(including any part of any accrued benefits distributed
in the five-year period ending on the determination
date(s)), determined in
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accordance with Section 416 of the Code and the
regulations thereunder.
(ii) If the Employer maintains one or more defined benefit
plans and the Employer also maintains or has maintained
one or more defined contribution plans (including any
simplified employee pension plan) which during the
five-year period ending on the determination date(s) has
or has had any Account balances, the top-heavy ratio for
any required or permissive aggregation group as
appropriate is a fraction, the numerator of which is the
sum of the Present Value of accrued benefits under the
aggregated defined benefit plan or plans of all key
employees and the sum of Account balances under the
aggregated defined contribution plan or plans for all key
employees as of the determination date(s), and the
denominator of which is the sum of the Present Value of
accrued benefits under the defined benefit plan or plans
for all Participants and the Account balances under the
aggregated defined contribution plan or plans for all
Participants as of the determination date(s), all
determined in accordance with Section 416 of the Code and
the regulations thereunder. The Account balances under a
defined contribution plan in both the numerator and
denominator of the top-heavy ratio are increased for any
distribution of an Account balance made in the five-year
period ending on the determination date.
(iii) For purposes of (i) and (ii) above, the value of Account
balances and the Present Value of accrued benefits shall
be determined as of the most recent valuation date that
falls within or ends with the 12-month period ending on
the determination date, except as provided in Section
416 of the Code and the regulations thereunder for the
first and second Plan Years of a defined benefit plan.
The Account balances and accrued benefits of a
Participant (A) who is not a key employee but who was a
key employee in a prior year, or (B) who has not been
credited with at least one Hour of Service with any
Employer maintaining the Plan at any time during the
five-year period ending on the determination date shall
be disregarded. The calculation of the top-heavy ratio,
and the extent to which distributions, rollovers, and
transfers are taken into account shall be made in
accordance with Section 416 of the Code and the
regulations thereunder. When aggregating plans, the
value of Account balances and accrued benefits shall be
- 68 -
<PAGE> 72
calculated with reference to the determination dates that
fall within the same calendar year. The accrued benefit
of a Participant other than a key employee shall be
determined under (A) the method, if any, that uniformly
applies for accrual purposes under all defined benefit
plans maintained by the Employer, or (B) if there is no
such method, as if such benefit accrued not more rapidly
than the slowest accrual rate permitted under the
fractional rule of Section 411(b)(1)(C) of the Code.
8.04 The following provisions shall be applicable to Participants for any
Plan Year with respect to which the Plan is top-heavy:
(a) In each Plan Year, in addition to the contributions otherwise
provided under the Plan, the Employer shall make contributions
on behalf of any such Participant (and each Employee eligible
to become a Participant) who is a non- key employee who has not
separated from service as of the Valuation Date irrespective of
his Hours of Service completed during the Plan Year, which
shall cause the total contributions to the Participant's
Account to be equal to a percentage of the Participant's
Compensation for the Plan Year, that percentage to be the
lesser of 3% or, for a profit sharing plan, the percentage
rate, determined for the key employee for whom that percentage
is the highest and equivalent to a fraction, the numerator of
which is the contribution made on behalf of that key employee
by the Employer under Section 3.01 and Article 4 and the
denominator of which is the Compensation of the key employee
for that Plan Year. When determining the minimum contribution
to be made on behalf of a non-key employee pursuant to this
Section 8.04, neither the Participant's Elective Deferral
Contributions nor Employer Matching Contributions made pursuant
to Article 4 shall be considered towards satisfaction of such
minimum contribution.
(b) With respect to any Plan Year beginning before 1989 in which the
Plan is top-heavy, Compensation to be taken into account under
the Plan means a Participant's total cash remuneration not in
excess of $200,000 per year paid to an Employee for services
rendered to the Employer and as reported on IRS Form W-2.
(c) If a non-key employee participates in both a defined benefit
plan and a defined contribution plan which are part of a
required aggregation group or permissive aggregation group and
the top-heavy ratio exceeds 60%, top-heavy minimum benefits will
be provided by this Plan in accordance with the formula set
forth in Section 8.04(a) except that the percentage of
Compensation to be allocated shall be 5%.
- 69 -
<PAGE> 73
8.05 The minimum allocation required [to the extent required to be
nonforfeitable under Code Section 416(b)] may not be forfeited under
Code Section 411(a)(3)(B) or 411(a)(3)(D).
8.06 For any Plan Year in which this Plan is top-heavy, one of the minimum
vesting schedules as elected by the Employer in the Adoption Agreement
shall automatically apply to the Plan. The minimum vesting schedule
applies to all benefits within the meaning of Section 411(a)(7) of the
Code except those attributable to Employee contributions, including
benefits accrued before the effective date of Code Section 416 and
benefits accrued before the plan became top-heavy. Further, no
decrease in a Participant's nonforfeitable percentage may occur in the
event the Plan's status as top-heavy changes for any Plan Year.
However, this Section does not apply to the Account balances of any
Employee who does not have an Hour of Service after the Plan has
initially become top-heavy and such Employee's Account balance
attributable to Employer contributions and forfeitures shall be
determined without regard to this Section.
- 70 -
<PAGE> 74
Article 9. General Provisions
9.01 Except as required by any applicable law, no benefit under the Plan
shall in any manner be anticipated, assigned or alienated, and any
attempt to do so shall be void. However, payment shall be made in
accordance with the provisions of any judgment, decree, or order which:
(a) creates for, or assigns to, a spouse, former spouse, child or
other dependent of a Participant the right to receive all or a
portion of the Participant's benefits under the Plan for the
purpose of providing child support, alimony payments or marital
property rights to that spouse, child or dependent,
(b) is made pursuant to a State domestic relations law,
(c) does not require the Plan to provide any type of benefit, or any
option, not otherwise provided under the Plan, and
(d) otherwise meets the requirements of Section 206(d) of ERISA, as
amended, as a "qualified domestic relations order", as
determined by the Plan Administrator, in its sole discretion.
9.02 The establishment of the Plan shall not confer any legal rights upon
any Employee or other person for a continuation of employment, nor
shall it interfere with the rights of the Employer to discharge any
Employee and to treat him without regard to the effect which that
treatment might have upon him as a Participant or potential Participant
in the Plan.
9.03 If the Plan Administrator shall find that a Participant or other
person entitled to a benefit is unable to care for his affairs because
of illness or accident or is a minor, the Plan Administrator, in its
sole discretion, may direct that any benefit due him, unless claim
shall have been made for the benefit by a duly appointed legal
representative, be paid to his spouse, a child, a parent or other
blood relative, or to a person with whom he resides. Any payment so
made shall be a complete discharge of the liabilities of the Plan for
that benefit.
9.04 Each Participant, Beneficiary or other person entitled to a benefit,
before any benefit shall be payable to him or on his account under the
Plan, shall file with the Plan Administrator the information that the
Plan Administrator, in its sole discretion, shall require to establish
his rights and benefits under the Plan.
- 71 -
<PAGE> 75
Article 10. Amendment, Merger and Termination
10.01 Amendment
(a) The sponsoring organization may amend any part of the Plan.
(b) The Employer may:
(i) Change the choice of options in the Adoption Agreement,
(ii) Add overriding language in the Adoption Agreement when
such language is necessary to satisfy Section 415 or
Section 416 of the Code because of the required
aggregation of multiple plans, and
(iii) Add certain model amendments published by the Internal
Revenue Service which specifically provide that their
adoption shall not cause the Plan to be treated as
individually designed. An Employer that amends the Plan
for any other reason shall no longer participate in this
prototype plan and shall be considered to have an
individually designed plan. When this Plan is used to
amend an existing plan, the terms and conditions of the
prior plan document shall prevail as to obligations and
rights of the parties to the Plan during the effective
period of the prior plan document. No amendment to the
Plan shall decrease the accrued benefit, or Account
balance of any Participant. If the Employer amends any
of the provisions of this Plan, it shall be considered
to be an individually designed plan.
10.02 No amendment to the Plan shall be effective to the extent that it has
the effect of decreasing a Participant's Account balance or eliminating
a benefit that is "protected" pursuant to Section 411(d)(6) of the
Code.
10.03 In the event that the vesting schedule of the Plan is amended, a
Participant's nonforfeitable percentage of his Employer Account
(determined as of the later of the date such amendment is adopted or
the date such amendment becomes effective) of any Employee who is a
Participant of the Plan shall not be less than the nonforfeitable
percentage computed under the Plan without regard to such amendment.
In addition, each Participant who has completed at least three years
of service may elect after the adoption of such amendment, to have his
nonforfeitable percentage computed under the Plan without regard to
such amendment. The period during which a Participant can elect an
old vesting schedule shall commence with the date the amendment is
adopted and shall end on the latest of:
(a) 60 days after the amendment is adopted,
(b) 60 days after the amendment becomes effective, or
- 72 -
<PAGE> 76
(c) 60 days after the Participant is issued written notice of the
amendments by the Employer or the Plan Administrator.
10.04 The Plan may not be merged or consolidated with, and its assets or
liabilities may not be transferred to, any other plan unless each
person entitled to benefits under the Plan would, if the resulting
plan were then terminated, receive a benefit immediately after the
merger, consolidation, or transfer which is equal to or greater than
the benefit he would have been entitled to receive immediately before
the merger, consolidation, or transfer if the Plan had then
terminated.
10.05 If any company is or becomes a subsidiary of or associated with the
Employer, through its Board of Directors, if any, may include the
employees of that subsidiary or associated company in the membership
of the Plan upon appropriate action by that company necessary to adopt
the Plan. In that event, or if any persons become Employees of an
Employer as the result of merger or consolidation or as the result of
acquisition of all or part of the assets or business of another
company, the Employer shall determine to what extent, if any, previous
service with the subsidiary, associated or other company shall be
recognized under the Plan, but subject to the continued qualification
of the trust for the Plan as tax-exempt under the Code.
10.06 Any subsidiary or associated company may terminate its participation
in the Plan upon appropriate action by it. In that event the funds of
the Plan held on account of Participants in the employ of that
company, and any unpaid balances of the Accounts of all Participants
who have separated from the employ of that company, shall be
determined by the Plan Administrator. Those funds shall be
distributed as provided in Section 10.07 if the Plan should be
terminated, or shall be segregated by the Trustees as a separate
trust, pursuant to certification to the Trustees by the Plan
Administrator, continuing the Plan as a separate plan for the
employees of that company under which the board of directors of that
company shall succeed to all the powers and duties of the Board of
Directors, if any, including the appointment of the members of the
Plan Administrator.
10.07 The Employer, through its Board of Directors, if any, may terminate the
Plan or completely discontinue contributions under the Plan for any
reason at any time. In the case of termination or partial termination
of the Plan, or a complete discontinuance of Employer contributions to
the Plan, the right of affected Participants to their Accounts under
the Plan as of the date of the termination, partial
- 73 -
<PAGE> 77
termination, or discontinuance shall be non-forfeitable. The amount in each
Participant's Accounts shall be distributed, as the Employer shall direct, to
him or for his benefit. In the event the Participant's Accounts exceed (or at
the time of any prior distribution exceeded) $3,500, the distribution shall not
be made prior to the Participant's 65th birthday without the consent of the
Participant and the Participant's spouse, if any, to that earlier distribution.
- 74 -
<PAGE> 78
BUCK CONSULTANTS, INC.
NON-STANDARDIZED
401(K) SAVINGS PLAN AND TRUST PROTOTYPE PLAN
ADOPTION AGREEMENT (#002)
IRS SERIAL # D8310524 Date 12/13/93
------------------------- -------------------
The
-----------------------------------------------------------------------------
(exact legal name of Employer)
(hereinafter referred to as the Employer), having its principal place of
business in
- --------------------------------------------------------------------------------
(City) (State)
hereby adopts Buck Consultants, Inc. Non-Standardized 401(k) Savings Plan and
Trust Prototype Plan, and further appoints as:
Trustee(s),
--------------------------------------------------------------------
-------------------------------------------------------------------;
Named Fiduciary*,
---------------------------------------------------------------;
Plan Administrator*,
-------------------------------------------------------; and
Agent for Legal Service of Process*,
-------------------------------------------.
*If same as Employer, write `Same'.
The Employer's Tax Year begins and ends
----------------- -------------------------.
Employer Telephone Number
----------------------.
Business Code Number (same as shown on Form 5500)
------------------------------.
Date Business Commenced
---------------------------------------.
In connection herewith, the Employer makes the following statements and
selections:
This Plan shall be known as
--------------------------------------------
(name of Employer)
401(k) Savings Plan and Trust which
------------------------------------
shall be identified by Employer I.D.#
----------------------------------
and Plan Serial # (001, 002, etc. - assign sequentially).
----------------
-1-
<PAGE> 79
The employer maintains, or has maintained, the following qualified plans: (List
all plans ever maintained by the Employer starting with Plan Serial #001.)
<TABLE>
<CAPTION>
Plan Status
Serial # Type of Plan In Force Terminated
-------- ------------ -------- ----------
<S> <C> <C> <C>
- ------------------ ----------------------------------------- [ ] [ ]
- ------------------ ----------------------------------------- [ ] [ ]
- ------------------ ----------------------------------------- [ ] [ ]
This Employer is: [ ]Sole Proprietor
[ ]Partnership
[ ]Corporation
[ ]S Corporation
[ ]Professional Corporation
[ ]Non Profit Corporation
</TABLE>
In the case of a group of employers which constitutes a Controlled Group of
Corporations, or an Affiliated Service Group [as defined in Sections 414(b) and
414(m), respectively, of the Internal Revenue Code], or which constitutes one or
more trades or businesses whether or not incorporated which are under common
control [as defined in Section 414(c)], all such employers shall be considered a
single employer for purposes of determining plan qualification, minimum
participation, benefit accrual, vesting standards, and limitations on benefits
and contributions. The employers listed below are required to be aggregated with
the adopting employer under Code Sections 414 (b), (c) or (m), and shall
participate in this Plan to the extent indicated as evidenced by written
resolution adopting this Plan. (If there are no affiliated employers, indicate
None.)
<TABLE>
<CAPTION>
Employer Employer Participating Participation
Name I.D. # Employer Effective Date
-------- -------- ------------- --------------
<S> <C> <C> <C>
- ------------------------------- ------------------------- [ ] Yes [ ] No --------------
- ------------------------------- ------------------------- [ ] Yes [ ] No --------------
- ------------------------------- ------------------------- [ ] Yes [ ] No --------------
</TABLE>
If this Plan and Trust is adopted by more than one member of the aggregation
group, this Plan
[ ] (a) shall be administered as one plan (i.e., contributions and forfeitures
shall not be separated for each participating Employer).
[ ] (b) shall be administered as a single employer plan for each participating
Employer [i.e., contributions shall be made by each Employer only for
those Participants employed by such Employer and forfeiture shall be
used to reduce the contribution made by the applicable Employer - each
asset pool shall be considered a separate plan which must independently
satisfy Code Section 401(a)(26)].
-2-
<PAGE> 80
Any Employee of a participating Employer must receive credit for service while
employed by any member of the aggregation group (including non-participating
employers) for purposes of vesting and eligibility under this Plan from the date
such Employer became a member of the aggregation group.
A-1.13 The adoption of this Plan constitutes: (check appropriate statement
and provide information)
[ ] (a) The initial adoption of this Plan and Trust by the Employer.
The Effective Date of this Plan is
--------------------------.
(month/day/year)
[ ] (b) An [ ] amendment and restatement, or [ ] merger of the
following Plan(s) known as
-----------------, -----------------
--------------------------------------------------------------
(name of Plans and Trusts)
with the original effective date(s) of
-------------------------------------------------------------.
(month/day/year)
The effective date of this amendment and restatement is
-------------------------------------------------------------.
(month/day/year)
==============
1. DEFINITIONS
==============
A-1.11 (a) Compensation with respect to any Participant means:
[ ] "Code Section 415 Compensation."
[ ] Compensation reportable as wages on Form W-2.
(b) However, for non-integrated plans, Compensation shall exclude (select
all that apply):
[ ] N/A No exclusions
[ ] overtime
[ ] bonuses
[ ] commissions
[ ] other
--------------------------------------------------------
-3-
<PAGE> 81
(c) For purposes of this Section, Compensation shall be based on:
[ ] the Plan Year.
[ ] the Fiscal Year coinciding with or ending within the Plan
Year.
[ ] the Calendar Year coinciding with or ending within the Plan
Year.
NOTE: The Limitation Year shall be the same as the year on
which Compensation is based.
(d) However, for an Employee's first year of participation, Compensation
shall be recognized as of:
[ ] the first day of the Plan Year.
[ ] the date the Participant entered the Plan.
(e) In addition, Compensation and "Code Section 414(s) Compensation"
[ ] shall [ ] shall not include compensation which is not currently
includible in the Participant's gross income by reason of the
application of Code Sections 125, 402(a)(8), 402(h)(1)(B) or 403(b).
A-1.27 Plan Year: (complete as necessary)
[ ] (a) the consecutive 12 month period for which records for this Plan
shall be maintained beginning and ending
------------ -----------.
[ ] (b) Short Plan Year? [ ] No [ ] Yes, beginning and
------------------
ending . Subsequent Plan Years shall be the
--------------------
consecutive 12-month period commencing each and
--------------
ending each . (The Plan must retain its
---------------
qualified status during this period.) Adjustments for
eligibility and vesting shall be made as required by Section
5.09(c) if the Plan Year is changed.
A-1.28 For purposes of establishing Present Value to compute the top-heavy
ratio, any benefit (under a Defined Benefit plan) shall be discounted
for mortality and interest based on the following: (If the Employer
maintains a defined benefit plan, this section must be completed.)
Interest Rate % Mortality Table
------- -------------
A-1.37 Valuation Date: shall mean the last day of the Plan Year unless
another date or dates are indicated below:
-4-
<PAGE> 82
-----------------------------------------------
A-1.39 (a) Years of Service with a predecessor employer;
Years of Service with
----------------------------------------,
for whom this Employer does not maintain a predecessor plan
shall be considered under the Plan for purposes of:
(select as desired)
[ ] Vesting
[ ] Eligibility
[ ] None of the above
(b) Vesting Years of Service: Years of Service credited for vesting
shall exclude the years checked below subject to Section 5.09:
(select as desired)
[ ] Years of Service before the Employee's
---------------------
(cannot exceed 18th) birthday. (If Hours Method is used, the
Plan Year in which the Employee attains age 18 shall not be
excluded.)
[ ] Years of Service prior to the original Effective Date of
this Plan or a predecessor plan.
[ ] Years of Service prior to (Date
----------------------------.
selected may not be later than the original effective date
of this Plan or a predecessor plan.)
[ ] N/A - No service shall be excluded.
Note: In general, a predecessor plan is a plan which terminates
within the five-year period immediately preceding or
following the establishment of this Plan.
(c) Years of Service shall be computed under the following method:
(select one)
[ ] (1) Hours Method -- based on the actual Hours of Service
credited to the Employee during the applicable
computation period.
[ ] (2) Elapsed Time Method -- based on the total time an
Employee is employed without regard to actual hours
credited as explained in Section 1.39 of this Plan.
==============
2. ELIGIBILITY
==============
-5-
<PAGE> 83
A-2.01 (a) For purposes of plan coverage and benefits, employees of
affiliated employers required to be aggregated with the Employer
under Section 414(b), (c) or (m) of the Code shall not be
treated as Employees of the Employer unless such affiliated
employers are identified as Participating Employers on page 2 of
this Adoption Agreement.
For purposes of plan coverage and benefits, the term "Employee"
[ ] shall include
[ ] shall not include
[ ] N/A (Employer has no "leased employees.")
"leased employees" who are required to be considered
employees of the Employer under Code Section 414(n).
(b) The following classes of Employees of the Employer shall be
eligible to participate in the Plan:
[ ] All Employees except Employees who are non-resident
aliens who have no income from the Employer subject to
U.S. income tax.
[ ] Hourly paid Employees
[ ] Salaried Employees
[ ] All Employees except Employees included in a unit
of Employees covered by a collective bargaining agreement
between the Employer and Employee representatives, if
retirement benefits were the subject of good faith
bargaining. For this purpose, the term "employee
representatives" does not include any organization more
than half of whose members are Employees who are owners,
officers, or executives of the Employer.
[ ] Other
---------------------------------------------------
(c) Minimum age and service requirements: (select one)
[ ] (1) An Employee shall become a Participant on
the Entry Date coincident with or next
following Age (cannot exceed
-------------
21) and the completion of
------------
(cannot exceed 1 year) year of Eligibility
Service. MUST HAVE AT LEAST 2 ENTRY
DATES, i.e. CANNOT ELECT (e)(1) BELOW.
If the year of Eligibility Service
includes a fractional year, an Employee
shall not be required to complete any
-6-
<PAGE> 84
specified number of Hours of Service to
receive credit for such fractional year.
[ ] (2) An Employee shall become a Participant on
the Entry Date coincident with or next
following Age _ _____________ (cannot
exceed 20 1/2) and the completion of
____________ [cannot exceed 1/2 year (6
months)] year of Eligibility Service. USE
THIS PROVISION ONLY WHEN (e)(1) (ONE ENTRY
DATE) IS ELECTED BELOW.
If the year of Eligibility Service includes
a fractional year, an Employee shall not be
required to complete any specified number
of Hours of Service to receive credit for
such fractional year.
(d) The preceding election in A-2.01(c) notwithstanding,
Employees who are actively employed on __________________
____________________________ shall be deemed to have
satisfied the
[ ] (1) Age requirement as of the Effective Date.
[ ] (2) Service requirements as of the Effective
Date.
[ ] (3) Age and service requirements as of the
Effective Date.
[ ] (4) N/A (Age and Service requirements in
A-2.01(c) apply to all Employees.)
(e) Entry Date: Shall mean: (select one)
[ ] (1) First day of Plan Year.
[ ] (2) First day of Plan Year and the date 6
months after the first day of the Plan
Year.
[ ] (3) The first day of the Plan Year and the
dates which are 3, 6 and 9 months after the
first day of the Plan Year.
[ ] (4) First day of each month.
==============================================================
3. PROFIT SHARING CONTRIBUTIONS AND ALLOCATIONS
==============================================================
A-3.01 Contributions
-7-
<PAGE> 85
===============================================================
Complete only if discretionary contributions are being made in
addition to contributions made in accordance with the selections
under Section 4 - Cash or Deferred Arrangement (CODA).
===============================================================
(a) The Employer shall contribute [select (1) or (2)]
[ ] (1) out of current or accumulated profits.
[ ] (2) without regard to current or accumulated
profits.
The amount of such contribution shall be [select (3) or
(4)]
[ ] (3) as determined by the Board of Directors
each year.
[ ] (4) Other
------------------------------------
(b) Allocation of contributions under A-3.01(a) above shall
be made for all Participants who are credited with at
least [select (1), (2), or (3)]
[ ] (1) 1,000 Hours of Service
[ ] (2) 500 Hours of Service
[ ] (3) one Hour of Service
during the Plan Year [select (4) or (5)]
[ ] (4) regardless of whether or not employed on
the last day of the Plan Year.
[ ] (5) and is employed by the Employer on the
last day of the Plan Year.
The preceding notwithstanding, the Plan Years beginning
after December 31, 1989, if the Plan would otherwise fail
to satisfy the requirements of Code Sections 401(a)(26)
or 410(b) because the Employer contributions have not
been allocated to a sufficient number or percentage of
Participants for a Plan Year, then the following rules
shall apply:
(1) The group of Participants eligible to share
in the Employer's contribution shall be
expanded to include all Participants who
are employed on the last day of the Plan
Year and who are credited with at least 500
Hours of Service.
(2) If after the application of paragraph (1)
above, the applicable test is still not
satisfied, then the group of
-8-
<PAGE> 86
Participants eligible to share in the
Employer's contribution shall be further
expanded to include all Participants who
are credited with at least 500 Hours of
Service regardless of employment on the
last day of the Plan Year.
Note: Employer includes all employers which are
required to aggregated with the Employer
under Code Sections 414(b), (c) or (m).
(c) If a Participant dies, retires, or becomes disabled
during the Plan Year and does not complete the hours
requirement for a contribution, an allocation
[ ] (1) shall not be made on such Participant's
behalf for such Plan Year.
[ ] (2) shall be made on such Participant's behalf
for such Plan Year.
(d) Employer contributions under this Section and
forfeitures, if applicable, shall be allocated to
Participant's Accounts as follows:
[ ] (1) NON-INTEGRATED FORMULA
On a pro-rata basis to all Participants in
the proportion that a Participant's
Compensation bears to the total of all
Participants' Compensation.
[ ] (2) INTEGRATED FORMULA (INTEGRATED WITH SOCIAL
SECURITY)
STEP ONE: In any Plan Year the Plan is
Top-Heavy contributions shall be allocated
to all Participants in the ratio that each
Participant's Compensation bears to all
Participants' Compensation, but not in
excess of 3% of such Compensation.
(If the plan is not top-heavy, proceed to
step two.)
STEP TWO: Any contributions not allocated
in STEP ONE shall be allocated to each
Participant's Account in the ratio that the
sum of each Participant's total
Compensation plus Compensation in excess of
the integration level bears to the sum of
all Participants' total Compensation plus
Compensation in excess of the integration
level, but not in excess of the maximum
disparity rate.
STEP THREE: Any remaining Employer
contributions shall be allocated to each
Participant's Account in the ratio
-9-
<PAGE> 87
that each Participant's total Compensation
for the Plan Year bears to all
Participants' total Compensation for that
year.
For purpose of this Section, Compensation
shall mean Compensation as defined in
Section 1.11 of the Plan.
The integration level shall be:
[ ] (i) The Taxable Wage Base (The
maximum amount of earnings
which may be considered wages
for a year under Section
3121(a)(1) of the Code in
effect as of the first day of
the Plan Year.)
[ ] (ii) $ (Must be
----------------
less than the Taxable Wage
Base.)
The maximum profit sharing disparity rate
is equal to the lesser of:
(a) 5.7% or
(b) The applicable percentage
determined in accordance with the
table below:
If the integration level:
<TABLE>
Is more But not more The applicable
than than percentage is
--------- --------------- --------------
<S> <C> <C>
$0.00 $X* 5.7%
X* 80% of TWB*** 4.3%
80% of TWB*** Y** 5.4%
</TABLE>
* X = the greater of $10,000 or 20% of the TWB.
** Y = any amount more than 80% of the TWB but
less than 100% of the TWB.
***TWB = Taxable Wage Base at the beginning of the
Plan Year. The TWB for 1989 was $48,000,
$51,300 for 1990 and $53,400 for 1991.
(e) Is any Employee who is eligible to participate under this
Plan covered by any other plan [including plans of
non-participating employers required to be aggregated
under Section 414(b), (c), or (m) of the Code] which is
integrated with Social Security?
[ ] (1) No
-10-
<PAGE> 88
[ ] (2) Yes
A-3.02 (a) Rollover contributions:
[ ] (1) shall not be permitted under this Plan.
[ ] (2) shall be permitted under this Plan.
(b) Rollover contributions shall be accepted from:
[ ] (1) Participants only.
[ ] (2) Participants and non-Participants
(otherwise eligible Employees who have not
yet satisfied the age and/or service
requirements for participation).
A-3.04 ALLOCATION OF EARNINGS shall be based on (select one):
[ ] the Account balance as of the beginning of the
allocation period plus 1/2 of all contributions
allocated at the end of the allocation period,
plus investment transfers in, and minus all
withdrawals and investment transfers out.
[ ] the Account balance as of the beginning of the
allocation period plus 1/2 of the Elective
Deferral Contributions made by the Participant
during the allocation period, plus investment
transfers in and minus all withdrawals and
investment transfers out.
[ ] the Account balance as of the beginning of the
allocation period plus 1/2 of the Elective
Deferral Contributions and rollover contributions
made by the Participant during the allocation
period, plus investment transfers in and minus all
withdrawals and investment transfers out.
[ ] the Account balance as of the beginning of the
allocation period plus investment transfers in,
and minus all withdrawals and investment transfers
out.
[ ] the Account balance as of the beginning of the
allocation period plus all contributions allocated
at the end of the allocation period and investment
transfers in, and minus all withdrawals and
investment transfers out.
A-3.11 Participants may direct the Trustee as to the investment of their
individual Account balances which are attributable to: (check all
which apply)
[ ] (a) Elective Deferrals, if any.
-11-
<PAGE> 89
[ ] (b) Employer Matching Contributions, if any.
[ ] (c) Rollovers, if any.
[ ] (d) All contributions regardless of source.
[ ] (e) None of the above -- Participants may not direct
the investment of their accounts.
A-3.16 Participant Loans
[ ] (a) shall be permitted in accordance with the
Employer's written loan policy.
[ ] (b) shall not be permitted.
===============================================================================
If the Employer maintains or ever maintained another qualified plan in which
any Participant in this Plan is (or was) a Participant or could become a
Participant, the Employer must complete this Section. The Employer must also
complete this Section if it maintains a welfare benefit fund, as defined in
Section 419(e) of the Code, or an individual medical account, as defined in
Section 415(1)(2) of the Code, under which amounts are treated as Annual
Additions with respect to any Participant in this Plan.
==============================================================================
A-3.27 If the Participant is covered under another qualified Defined
Contribution plan maintained by the Employer, other than a Master or
Prototype plan:
[ ] (a) N/A
[ ] (b) The provisions of Sections 3.20 and 3.21 of
Article 3 shall apply as if the other plan were a
Master or Prototype plan.
[ ] (c) The amount of Annual Additions credited to a
Participant under this Plan shall be limited so
that the total Annual Additions allocated to the
Participant does not exceed the Maximum
Permissible Amount.
[ ] (d) The amount of Annual Additions credited to a
Participant under the other Plan maintained by the
Employer shall be limited so that the total Annual
Additions allocated to the Participant does not
exceed the Maximum Permissible Amount.
A-3.28 If the Participant is or has ever been a Participant in a Defined
Benefit plan maintained by the Employer:
[ ] (a) N/A
-12-
<PAGE> 90
[ ] (b) The Annual Additions which may be credited to the
Participant's Account under this Plan shall not
be limited other than by the Maximum Permissible
Amount as defined in Section 3.29(i). If the sum
of the Defined Benefit Fraction and the Defined
Contribution Fraction would otherwise exceed 1.0,
such sum shall be reduced so as to not exceed 1.0
by adjusting the Participant's Projected Annual
Benefit under the Defined Benefit plan.
[ ] (c) If the sum of the Defined Benefit Fraction
and the Defined Contribution Fraction would
otherwise exceed 1.0, such sum shall be reduced so
as to not exceed 1.0 by adjusting the
Participant's Annual Additions under this Plan.
=======================================
4. CASH OR DEFERRED ARRANGEMENT (CODA)
=======================================
A-4.01 ELECTIVE DEFERRALS
(a) An eligible Employee may elect to have his Compensation reduced
by
[ ] from % to %
----------------------- ----------------------
[ ]
--------------------------------------------------------
(Specify)
Such election shall be in writing and in a form and manner
specified by the Plan Administrator.
(b) A Participant may elect to commence, or modify the amount of,
Elective Deferrals as of:
[ ] the first day of each Plan Year.
[ ] the first day of each Plan Year and the date 6 months
after the first day of each Plan Year.
[ ] the first day of each Plan Year quarter.
The Plan Administrator may permit an additional election in the
event an Actual Deferral Percentage Test performed during the
Plan Year permits or requires an adjustment in the deferral
percentages.
A-4.02 MATCHING CONTRIBUTIONS
(a) The Employer [select (1) or (2)]
-13-
<PAGE> 91
[ ] (1) shall
[ ] (2) shall not
make Matching Contributions to the Plan on behalf of all
Participants who elect to have Elective Deferrals made under the
Plan and who are credited with at least [select (3), (4) or (5)]
[ ] (3) 1,000 Hours of Service
[ ] (4) 500 Hours of Service
[ ] (5) one Hour of Service
during the Plan Year [select (6) or (7)]
[ ] (6) regardless of whether or not employed on the last
day of the Plan Year.
[ ] (7) and is employed by the Employer on the last day of
the Plan Year.
The preceding notwithstanding, for Plan Years beginning after
December 31, 1989, if the Plan would otherwise fail to satisfy
the requirements of Code Sections 401(a)(26) or 410(b) because
the Employer contributions have not been allocated to a
sufficient number or percentages of Participants for a Plan
Year, then the following rules shall apply:
(1) The group of Participants eligible to share
in the Employer's contribution shall be expanded
to include all Participants who are employed on
the last day of the Plan Year and who are credited
with at least 500 Hours of Service.
(2) If after the application of paragraph (1)
above, the applicable test is still not satisfied,
then the group of Participants eligible to share
in the Employer's contribution shall be further
expanded to include all Participants who are
credited at least 500 Hours of Service regardless
of employment on the last day of the Plan Year.
Note: Employer includes all employers which are required to be
aggregated with the Employer under Code Sections 414(b),
(c) or (m).
(b) The Employer shall contribute and allocate to each
Participant's Matching Contribution Account:
-14-
<PAGE> 92
[ ] an amount equal to percent of
-------------------------
the Participant's Elective Deferrals.
[ ] a discretionary matching contribution equal to a
percentage (to be determined each year by the Employer)
of each Participant's Elective Deferrals.
(c) The Employer shall not match Elective Deferrals in excess of
----
percent of a Participant's (select one):
[ ] Compensation per pay period.
[ ] annual Compensation.
(d) The Matching Contribution allocated to any Participant's
account for the Plan Year shall not exceed (select one):
[ ] $
-------------------------
[ ] percent of the Participant's annual Compensation.
------
[ ] N/A
(e) Matching Contributions shall be vested in accordance with
the following schedule (select one):
[ ] 100% vested at all times.
[ ] The vesting schedule as elected in A-5.09(b) of the
Adoption Agreement.
(f) Matching contributions shall be made (select one):
[ ] only from current or accumulated profits.
[ ] without regard to current or accumulated profits.
A-4.03(F) Qualified non-elective contributions shall be allocated to the
accounts of Participants who are not Highly Compensated Employees and
who are credited with at least [select (1), (2) or (3)]
[ ] (1) 1,000 Hours of Service
[ ] (2) 500 Hours of Service
[ ] (3) one Hour of Service
-15-
<PAGE> 93
during the Plan Year [select (4) or (5)]
[ ] (4) regardless of whether or not employed on the last
day of the Plan Year.
[ ] (5) and is employed by the Employer on the last day of
the Plan Year.
The preceding notwithstanding, for Plan Years beginning after
December 31, 1989, if the Plan would otherwise fail to satisfy
the requirements of Code Sections 401(a)(26) or 410(b) because
the Employer contributions have not been allocated to a
sufficient number or percentage of Participants for a Plan Year,
then the following rules shall apply:
(1) The group of Participants eligible to share in the
Employer's contribution shall be expanded to include all
Participants who are employed on the last day of the
Plan Year and who are credited with at least 500 Hours
of Service.
(2) If after the application of paragraph (1) above, the
applicable test is still not satisfied, then the group of
Participants eligible to share in the Employer's
contribution shall be further expanded to include all
Participants who are credited with at least 500 Hours of
Service regardless of employment on the last day of the
Plan Year.
Note: Employer includes all employers required to be aggregated
with the Employer under Code Sections 414(b), (c) or (m).
A-4.08 Pre-retirement distributions of all or any portion of a Participant's
Account balance, including Elective Deferrals and qualified
non-elective contributions, upon attainment of age (may
------------
not be less than 59 1/2)
[ ] (a) shall
[ ] (b) shall not
be permitted provided the Participant is 100% vested, and the balance
in the Participant's Account has accumulated for at least two years, or
the Participant has completed five years of participation in the Plan.
A-4.11 Distribution on account of financial hardship
[ ] (a) shall
[ ] (b) shall not
be permitted to the extent provided in Section 4.11, and subject to
applicable regulations.
-16-
<PAGE> 94
============
5. BENEFITS
============
A-5.01 Normal Retirement Date: (select one)
[ ] (a) The later of the first day of the month on or following a
Participant's (cannot be less than 55th or
------------
exceed 65th) birthday or the first day of the month on or
following the (lst - 5th or N/A) anniversary in
------
which (select one)
[ ] participation commenced
[ ] the Employee first performed an Hour of Service
but in no event later than the first day of the month on
or following a Participant's birthday.
-------------
[ ] (b) The later of the first day of the Plan Year nearest a
Participant's (cannot be less than
----------------------
55th or exceed 65th) birthday, or the first day of the
Plan Year nearest the (1st - 5th or
-------------------
N/A) anniversary in which (select one)
[ ] participation commenced
[ ] the Employee first performed an Hour of Service
but in no event later than the first day of the
Plan Year nearest a Participant's
--------------
birthday.
A-5.03 Disability Retirement Benefit
In the event of total and permanent Disability, a Participant shall:
(select one)
[ ] (a) automatically become 100% Vested in the Account.
[ ] (b) be entitled to the vested Account based on the vesting
schedule designated in the Adoption Agreement.
A-5.06 Benefits shall be distributed
[ ] (a) only in the form of a single lump-sum payment. (May not
elect if other forms were available immediately preceding
the adoption of this Plan.)
[ ] (b) in accordance with the provisions of Section 5.11.
-17-
<PAGE> 95
A-5.09(B) The vesting schedule for benefits (derived from the Employer's
contributions pursuant to Article 3) upon termination of employment
shall be determined according to the selection based on years of
Vesting Service as credited in accordance with A-1.39: (select one)
[ ] (a) 100% vested at all times
[ ] (b) 100% vested after (not to exceed
----------------
5) years of Vesting Service.
[ ] (c) 20% vested after 2 years of Vesting Service
40% vested after 3 years of Vesting Service
60% vested after 4 years of Vesting Service
80% vested after 5 years of Vesting Service
100% vested after 6 years of Vesting Service
[ ] (d) 20% vested after 3 years of Vesting Service
40% vested after 4 years of Vesting Service
60% vested after 5 years of Vesting Service
80% vested after 6 years of Vesting Service
100% vested after 7 years of Vesting Service
[ ] (e) Specify: (Must in all years be as favorable as the
schedule in (b) above, or as favorable as the
schedule in (d) above.)
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
NOTE: IF THIS IS A RESTATED PLAN AND THE VESTING
SCHEDULE HAS BEEN AMENDED, ENTER THE PRE-AMENDMENT
SCHEDULE BELOW:
[ ] (f) % vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
[ ] (g) Vesting schedule has not been amended or is more
favorable than prior schedule at all points in
time.
A-5.09(D) Distributions upon termination of service shall be made as soon as
administratively feasible following:
-18-
<PAGE> 96
[ ] (a) Termination of employment.
[ ] (b) The end of the Plan Year following termination of
employment.
[ ] (c) The end of the Plan Year during which a One-Year
Break in Service occurs.
[ ] (d) Normal Retirement Date, Death, or Disability.
Note: May not be more restrictive than the provision in effect
immediately preceding the adoption of this Plan.
=============
8. TOP-HEAVY
=============
================================================================================
Before completing this Section of the Adoption Agreement, the Employer should
carefully read Article 8 of the Prototype Plan Document.
================================================================================
A-8.04 Minimum Top-heavy Allocations: The purpose of this Section A-8.04 is
to coordinate Top-Heavy minimum contributions or benefits when two or
more plans of the Employer are involved. If the Employer maintains
only this plan, and has never maintained a Defined Benefit plan, the
Employer is required to complete only Section (d). If the Employer
maintains (or has maintained) a Defined Benefit plan, this Section
should be completed with only the advice of that plan's actuary. If
the Employer maintains two Defined Contribution plans, and has never
maintained a Defined Benefit plan, the Employer is required to complete
only Section (c).
(a) If the Employer maintains a Defined Benefit plan, this Section
must be completed.
If a non-key Employee participates in both a Defined Benefit
plan and a Defined Contribution plan which are part of a
Required Aggregation Group or a Permissive Aggregation Group and
the Top-Heavy Ratio exceeds 60% (but does not exceed 90%),
Top-Heavy minimum benefits shall be provided as follows:
[ ] (1) In the Defined Contribution Plan, with a minimum
allocation of:
[ ] (i) 5% of total Compensation (Defined
Benefit and Defined Contribution
Fractions computed using 100% of the
dollar limitation).
-19-
<PAGE> 97
[ ] (ii) 7.5% of total Compensation (Defined
Benefit and Defined Contribution
Fractions computed using 125% of the
dollar limitation).
[ ] (2) In the Defined Benefit Plan, with a minimum
annual accrual of:
[ ] (i) 2% of the highest 5 consecutive year
average compensation (Defined
Benefit and Defined Contribution
fractions computed using 100% of the
dollar limitation).
[ ] (ii) 3% of the highest 5 consecutive year
average compensation. (Defined
Benefit and Defined Contribution
Fractions computed using 125% of the
dollar limitation).
If the Top-Heavy Ratio exceeds 90%, the minimum benefit shall be
provided in:
[ ] (3) the Defined Contribution plan with a minimum
allocation of 5% of total Compensation.
[ ] (4) the Defined Benefit plan with a minimum accrual of
2% of the highest 5 consecutive year average
compensation.
Note: When the Top-Heavy Ratio exceeds 90%, the
Defined Benefit and Defined Contribution
Fractions shall be computed using 100% of
the dollar limitation.
(b) If the Employer maintains (or has maintained) a Defined
Benefit plan, this Section must be completed.
If the Employer maintains both a Defined Benefit plan and a
Defined Contribution plan which are part of a Required
Aggregation Group or a Permissive Aggregation Group and the
Top-Heavy Ratio exceeds 60% (but does not exceed 90%), a non-key
Employee who participates only in the Defined Contribution plan
shall receive a minimum allocation of:
[ ] (1) 3% of total Compensation (Defined Benefit and
Defined Contribution Fractions computed using 100%
of the dollar limitation).
[ ] (2) 4% of total Compensation (Defined Benefit and
Defined Contribution Fractions computed using 125%
of the dollar limitation).
-20-
<PAGE> 98
If the Top-Heavy Ratio exceeds 90%, each non-key Employee who
participates only in the Defined Contribution plan shall receive
a minimum allocation of 3% of total Compensation.
(c) If the Employer maintains two Defined Contribution plans, this
Section must be completed.
If a non-key Employee participates in two Defined Contribution
plans maintained by the Employer, the Defined Contribution
minimum allocation requirement shall be met
[ ] (1) in this plan.
[ ] (2) in the other plan.
-------------------------------
(Name of Plan)
(d) Complete this Section only if (a), (b) and/or (c) have not been
completed.
[ ] The Employer maintains only this Plan and has never
maintained a Defined Benefit Plan.
A-8.06 TOP HEAVY VESTING...If this Plan becomes a Top-Heavy Plan, the
following vesting schedule for such Plan Year and each succeeding Plan
Year, whether or not Top-Heavy, shall be effective and shall be
treated as a Plan amendment pursuant to this Agreement.
[ ] (a) 100% vested after (not to exceed
-----------------------
3) years of Vesting Service.
[ ] (b) 20% vested after 2 years of Vesting Service
40% vested after 3 years of Vesting Service
60% vested after 4 years of Vesting Service
80% vested after 5 years of Vesting Service
100% vested after 6 years of Vesting Service
[ ] (c) Specify: (Must in all years be as favorable as either
the schedule in (a) or (b) above.)
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
% vested after years of Vesting Service
----- -----
-21-
<PAGE> 99
[ ] (d) N/A, Vesting schedule in A-5.09 is equal to or more
favorable than (a) or (b) above.
However, this Section does not apply to the Account balances of any
Participant who does not have an Hour of Service after the Plan has
initially become Top-Heavy. Such Participant's Account balance
attributable to Employer contributions and forfeitures shall be
determined without regard to this Section.
- --------------------------------------------------------------------------------
The adopting Employer may not rely on an Opinion Letter issued by the Cincinnati
Key District Office of the Internal Revenue Service as evidence that the Plan is
qualified under Section 401 of the Internal Revenue Code. In order to obtain
reliance with respect to plan qualification, the Employer must apply to the
appropriate key district office for a Determination Letter.
This adoption agreement may be used only in conjunction with Defined
Contribution Prototype Plan #01.
Provided the adoption of this Plan is properly registered with the Prototype
Sponsor, the Prototype Sponsor shall inform the adopting Employer of any
amendments made to the Plan or of the discontinuance or abandonment of the Plan.
The adoption of the Plan is not properly registered unless the attached
registration card is returned to:
Buck Consultants, Inc.
202 West Berry Street, Suite 700
Fort Wayne, IN 46802
Inquiries by adopting Employers regarding the adoption of this Plan, the
intended meaning of any Plan provisions, or the effect of the Opinion Letter may
be directed to the Prototype Sponsor at the above address or phone (219)
426-7800.
The Employer represents that it has consulted with its attorney with respect to
its adoption of this Plan, and agrees to the provisions of the Plan and Trust.
IN WITNESS HEREOF, the Employer has caused this Agreement to be signed by its
duly authorized Officer and the Trustee(s) have accepted the appointment and
signed this Agreement.
----------------------------------------
(Legal Name of Employer)
BY:
- ----------------------- ----------------------------------------
(Date) (Signature of Officer)
Accepted By:
- ----------------------- ----------------------------------------
(Date) (Signature of Trustee)
-22-
<PAGE> 100
- ----------------------- ------------------------------------
(Date) (Signature of Trustee)
- ----------------------- ------------------------------------
(Date) (Signature of Trustee)
<TABLE>
Participating Employer Authorized Signature Date
- ---------------------- -------------------- ----
<S> <C> <C>
- ---------------------- -------------------- ----
- ---------------------- -------------------- ----
</TABLE>
================================================================================
Failure to complete this Adoption Agreement properly may result in
disqualification of the Plan.
================================================================================
R E G I S T R A T I O N
OF
BUCK CONSULTANTS, INC.
NON-STANDARDIZED
401(K) SAVINGS PLAN AND TRUST PROTOTYPE PLAN
PLAN #002
Adopting Employer:
--------------------------------------------------------------
Address:
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
Telephone: ( )
-----------------------------
The Adopting Employer agrees to provide Buck with any changes to its current
mailing address and to give Buck written notification of any plan amendment (as
outlined in Section 10.01 of the Defined Contribution Prototype Plan #01),
restatement or termination.
Buck agrees to:
* provide the Adopting Employer with a copy of the current
Defined Contribution Prototype Plan #01 and Adoption Agreement;
and
* advise the Adopting Employer of any amendments made to the
Prototype Plan; and
* inform the Adopting Employer of any changes in the Prototype
Plan's qualified status; and
* inform the Adopting Employer of any discontinuance or
abandonment of the Prototype Plan.
This registration does not effect the rights and obligations of Buck or the
Adopting Employer under any other arrangement, including (but not limited to)
Buck's right to charge a fee for providing an updated Prototype Plan and/or
Adoption Agreement.
-23-
<PAGE> 101
Continued reliance by the Adopting Employer upon the Prototype Plan's favorable
Opinion Letter from the IRS is dependent upon the Adopting Employer adopting the
current version of the Prototype Plan.
Please sign and return this registration form to:
Buck Consultants, Inc.
202 W. Berry Street, Suite 700
Fort Wayne, IN 46802
Attention: Nancy C. Peterson
- --------------------------------------------------------------------------------
(Adopting Employer) (Title) (Date)
-24-
<PAGE> 1
Exhibit 24.24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement;
NOW, THEREFORE, the Trust hereby constitutes and appoints JAMES R.
CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, its
attorneys for it and in its name, place and stead, to execute and file such
Post-Effective Amendment No. 15, hereby giving and granting to said attorneys
full power and authority to do and perform all and every act and thing
whatsoever requisite and necessary to be done in and about the premises as fully
to all intents and purposes as it might or could do if personally present at the
doing thereof, hereby ratifying and confirming all that said attorneys may or
shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the Trust has caused its name to be subscribed
hereto by the President this 8th day of May, 1995.
ATTEST: BARTLETT MANAGEMENT TRUST
/s/ James F. Lummanick By /s/ Carol D. Hard
- ---------------------------------------------- ------------------------
James F. Lummanick, Secretary Carol D. Hard, President
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared CAROL D. HARD, President and JAMES F. LUMMANICK, Secretary,
who represented that they are duly authorized in the premises, and who are known
to me to be the persons described in and who executed the foregoing instrument,
and they duly acknowledged to me that they executed and delivered the same for
the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 2
CERTIFICATE
The undersigned, Secretary of BARTLETT MANAGEMENT TRUST, hereby certifies
that the following resolution was duly adopted by the Board of Trustees at the
meeting held on May 8, 1995 and is in full force and effect:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"),
proposes to file with the Securities and Exchange Commission under the
provisions of the Securities Act of 1933 and the Investment Company Act
of 1940, Post-Effective Amendment No. 15 to its Registration Statement;
NOW, THEREFORE, the Trust hereby constitutes and appoints JAMES R.
CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them,
its attorneys for it and in its name, place and stead, to execute and
file such Post- Effective Amendment No. 15, hereby giving and granting
to said attorneys full power and authority to do and perform all and
every act and thing whatsoever requisite and necessary to be done in
and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby
ratifying and confirming all that said attorneys may or shall lawfully
do or cause to be done by virtue hereof."
Dated: May 8, 1995 /s/ James F. Lummanick
-----------------------------
JAMES F. LUMMANICK, Secretary
Bartlett Management Trust
<PAGE> 3
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the Commonwealth of Massachusetts (hereinafter referred to as the
"Trust"), proposes to file with the Securities and Exchange Commission under the
provisions of the Securities Act of 1933 and the Investment Company Act of 1940,
as amended, Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is an officer of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ Thomas A. Steele
----------------------------
THOMAS A. STEELE, Treasurer
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state, personally
appeared THOMAS A. STEELE, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that he executed
and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 4
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is an officer of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th day
of May, 1995.
/s/ Thomas A. Steele
---------------------------
THOMAS A. STEELE, Principal
Accounting Officer
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state, personally
appeared THOMAS A. STEELE, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that he executed
and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 5
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is a trustee of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15
, hereby giving and granting to said attorneys full power and authority to do
and perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ Alan R. Schriber
-------------------------
ALAN R. SCHRIBER, Trustee
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared ALAN R. SCHRIBER, known to me to be the person described in
and who executed the foregoing instrument, and who acknowledged to me that he
executed and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is a trustee of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15
, hereby giving and granting to said attorneys full power and authority to do
and perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ William P. Sheehan
---------------------------
WILLIAM P. SHEEHAN, Trustee
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state, personally
appeared WILLIAM P. SHEEHAN, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that he executed
and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is a trustee of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ Lorrence T. Kellar
---------------------------
LORRENCE T. KELLAR, Trustee
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared LORRENCE T. KELLAR, known to me to be the person described
in and who executed the foregoing instrument, and who acknowledged to me that he
executed and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 8
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is a trustee of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ Philip J. Ringo
------------------------
PHILIP J. RINGO, Trustee
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared PHILIP J. RINGO, known to me to be the person described in
and who executed the foregoing instrument, and who acknowledged to me that he
executed and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 9
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is a trustee of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in his office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 8th
day of May, 1995.
/s/ George J. Wile
-----------------------
GEORGE J. WILE, Trustee
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared GEORGE J. WILE, known to me to be the person described in
and who executed the foregoing instrument, and who acknowledged to me that he
executed and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 10
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is an officer of the Trust;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for her and in her name, place and stead, and in her office and
capacity in the Trust, to execute and file such Post-Effective Amendment No. 15,
hereby giving and granting to said attorneys full power and authority to do and
perform all and every act and thing whatsoever requisite and necessary to be
done in and about the premises as fully to all intents and purposes as it might
or could do if personally present at the doing thereof, hereby ratifying and
confirming all that said attorneys may or shall lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand this 8th day
of May, 1995.
/s/ Carol D. Hard
------------------------
CAROL D. HARD, President
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state, personally
appeared CAROL D. HARD, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that she executed
and delivered the same for the purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<PAGE> 11
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, BARTLETT MANAGEMENT TRUST , a business trust organized under
the laws of the State of Ohio (hereinafter referred to as the "Trust"), proposes
to file with the Securities and Exchange Commission under the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, as amended,
Post-Effective Amendment No. 15 to its Registration Statement; and
WHEREAS, the undersigned is an officer or both an officer and a trustee
of the Trust, as indicated beside his name;
NOW, THEREFORE, the undersigned hereby constitutes and appoints JAMES
R. CUMMINS, DONALD S. MENDELSOHN and JAMES F. LUMMANICK, and each of them, his
attorneys for him and in his name, place and stead, and in each of his/her
offices and capacities in the Trust, to execute and file such Post-Effective
Amendment No. 15, hereby giving and granting to said attorneys full power and
authority to do and perform all and every act and thing whatsoever requisite and
necessary to be done in and about the premises as fully to all intents and
purposes as he/she might or could do if personally present at the doing thereof,
hereby ratifying and confirming all that said attorneys may or shall lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has hereunto set his hand
this 8th day of May, 1995.
/s/ James B. Reynolds /s/ Dale H. Rabiner
- ------------------------------- ----------------------------
JAMES B. REYNOLDS, Trustee and DALE H. RABINER, Trustee and
Chairman of the Board of Trustees Vice President
STATE OF OHIO )
) ss:
COUNTY OF HAMILTON )
Before me, a Notary Public, in and for said county and state,
personally appeared, DALE H. RABINER and JAMES B. REYNOLDS, known to me to be
the persons described in and who executed the foregoing instrument, and they
duly acknowledged to me that they executed and delivered the same for the
purposes therein expressed.
WITNESS my hand and official seal this 8th day of May, 1995.
/s/ Doris J. Leonard
------------------------------------
Notary Public
State of Ohio
My Commission Expires Sept. 27, 1999
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BARTLETT
CAPITAL TRUST AND BARTLETT MANAGEMENT TRUST ANNUAL REPORT FOR THE YEAR ENDED
MARCH 31,1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000750006
<NAME> BARTLETT MANAGEMENT TRUST
<SERIES>
<NUMBER> 1
<NAME> BARTLETT CASH RESERVES FUND
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1995
<PERIOD-START> APR-01-1994
<PERIOD-END> MAR-31-1995
<INVESTMENTS-AT-COST> 87,812,326
<INVESTMENTS-AT-VALUE> 88,183,073
<RECEIVABLES> 2,117,475
<ASSETS-OTHER> 823
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 90,301,371
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 129,085
<TOTAL-LIABILITIES> 129,085
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 90,269,413
<SHARES-COMMON-STOCK> 90,269,413
<SHARES-COMMON-PRIOR> 77,586,665
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (96,522)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (605)
<NET-ASSETS> 90,172,286
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,890,626
<OTHER-INCOME> 0
<EXPENSES-NET> 614,397
<NET-INVESTMENT-INCOME> 3,276,229
<REALIZED-GAINS-CURRENT> (81,479)
<APPREC-INCREASE-CURRENT> 13,459
<NET-CHANGE-FROM-OPS> 3,208,209
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 3,276,229
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 367,680,400
<NUMBER-OF-SHARES-REDEEMED> 358,112,926
<SHARES-REINVESTED> 3,115,274
<NET-CHANGE-IN-ASSETS> 12,614,728
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (15,043)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 614,397
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 614,397
<AVERAGE-NET-ASSETS> 78,768,846
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .04
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .04
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.78
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
