<PAGE>
As filed with the Securities and Exchange Commission on May 22, 1996
1933 Act Registration No. 33-10207
1940 Act Registration No. 811-4904
========================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No.
Post-Effective Amendment No. 20 X
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 20 X
IAI INVESTMENT FUNDS III, INC.
(Exact Name of Registrant as Specified in Charter)
3700 First Bank Place, P.O. Box 357
Minneapolis, Minnesota 55440
(Address of Principal Executive Offices) (Zip Code)
(612) 376-2700
(Registrant's Telephone Number, including Area Code)
Christopher J. Smith, Esq. Copy to:
3700 First Bank Place Michael J. Radmer, Esq.
P.O. Box 357 Dorsey & Whitney
Minneapolis, Minnesota 55440 220 South Sixth Street
(Name and Address of Agent for Service)Minneapolis, Minnesota 55402
It is proposed that this filing will become effective (check
appropriate box)
___ immediately upon filing pursuant to paragraph (b)
X
--- on June 1, 1996 pursuant to paragraph (b)
--- 60 days after filing pursuant to paragraph (a)(1)
___ on (date) pursuant to paragraph (a)(1)
--- 75 days after filing pursuant to paragraph (a)(2)
--- on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
--- this post-effective amendment designates a new effective
date for a previously filed post-effective amendment
Registrant has registered an indefinite number of securities
under the Securities Act of 1933 pursuant to Rule 24f-2 under the
Investment Company Act of 1940, as amended. Rule 24f-2 Notices
were last filed with the Commission on March 28, 1996.
<PAGE>
IAI INVESTMENT FUNDS III, INC.
FORM N-1A
CROSS-REFERENCE SHEET
<TABLE>
<CAPTION>
Item Number Caption Prospectus Caption
- ----------- ------- -------------------
<C> <C> <S>
1 Cover Page....................... Cover Page of Prospectus
2 Synopsis.......................... Fund Expense Information
3 Condensed Financial Information... Financial Highlights;
Investment Performance
4 General Description of Registrant... Investment Objectives and
Policies; Description of
Common Stock; Additional
Information
5 Management of the Fund.............. Fund Expense Information;
Management; Additional
Information; Custodian,
Transfer Agent and
Dividend Disbursing Agent
5A Management's Discussion of Fund
Performance Information............. Information is contained
in the Annual Report
6 Capital Stock and Other Securities... Dividends, Distributions
and Tax Status;
Description of
Common Stock; Additional
Information
7 Purchase of Securities Being
Offered............................. Distribution of Fund
Shares;
Computation of Net
Asset Value and Pricing;
Purchase of Shares;
Automatic Investment
Plan; Exchange
Privilege; Automatic
Exchange Plan;
Retirement Plans;
Authorized Telephone
Trading
8 Redemption or Repurchase........... Systematic Cash
Withdrawal Plan;
Redemption of Shares
9 Pending Legal Proceedings.......... Not Applicable
</TABLE>
2
<PAGE>
<TABLE>
Item Number Caption Statement of Additional
Information Caption
- ---------- ---------- -----------------------
<C> <C> <S>
10 Cover Page......................... Cover Page of Statement
of Additional Information
11 Table of Contents.................. Table of Contents
12 General Information and History.... History
13 Investment Objectives and Policies... Investment Objectives
and Policies; Investment
Restrictions
14 Management of the Fund................ Management
15 Control Persons and Principal
Holders of Securities................. Management
16 Investment Advisory and Other
Services............................. Investment Advisory
and Administrative
Services
17 Brokerage Allocation................. Portfolio Transactions
and Allocation of
Brokerage
18 Capital Stock and Other Securities.... Capital Stock
19 Purchase, Redemption and Pricing
of Securities Being Offered........... Net Asset Value and
Public Offering Price
20 Tax Status............................ Tax Status
21 Underwriters.......................... Plan of Distribution
22 Calculation of Performance Data....... Investment Performance
23 Financial Statements.................. Financial Statements
</TABLE>
3
<PAGE>
Registration Statement on Form N-1A
of
IAI Investment Funds III, Inc.
(File No. 33-10207)
Part A
Part A to the Registration Statement of IAI International
Fund and IAI Developing Countries Fund, separate portfolios of
IAI Investment Funds III, Inc., is incorporated herein by
reference to said Part A as filed with the Commission by Post-
Effective Amendment No. 19 (File No. 33-10207) on April 1, 1996.
<PAGE>
Registration Statement on Form N-1A
of
IAI Investment Funds III, Inc.
(File No. 33-10207)
Part B
Part B to the Registration Statement of IAI International
Fund and IAI Developing Countries Fund, separate portfolios of
IAI Investment Funds III, Inc., is incorporated herein by
reference to said Part B as filed with the Commission by Post-
Effective Amendment No. 19 (File No. 33-10207) on April 1, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933 and the Investment Company Act of 1940, Registrant certifies
that it meets all of the requirements for effectiveness of this
Registration Statement pursuant to Rule 485(a) under the
Securities Act of 1933 and has duly caused this Post-Effective
Amendment to its Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Minneapolis, and State of Minnesota, on the 21st day of May,
1996.
IAI INVESTMENT FUNDS III, INC.
(Registrant)
By /s/ Richard E. Struthers, President
--------------------------------------
Richard E. Struthers, President
Pursuant to the requirements of the Securities Act of
1933, this Post-Effective Amendment to the Registration Statement
has been signed below by the following persons in the capacities
and on the dates indicated:
/s/ Richard E. Struthers President (principal May 21, 1996
- ------------------------- executive officer) & Director
Richard E. Struthers
/s/ Archie C. Black III Treasurer (principal May 21, 1996
- ------------------------ financial and accounting
Archie C. Black III officer)
Noel P. Rahn (1)
Director
Madeline Betsch (1)
Director
W. William Hodgson (1)
Director
George R. Long (1)
Director
J. Peter Thompson (1)
Director
Charles H. Withers (1)
Director
/s/ William C. Joas May 21, 1996
- -----------------------
William C. Joas
Attorney-in-fact
(1) Registrant's directors executing Powers of Attorney dated
August 18, 1993, and filed with the Commission on June 28, 1994.
<PAGE>
PART C
Item 24. Financial Statements and Exhibits
(a) Financial Statements (1)
(b) Exhibits
(1) Articles of Incorporation (3)
(2) Bylaws (4)
(5A) Investment Advisory Agreement (4)
(5B) Subadvisory Agreement (4)
(5C) Management Agreement (7)
(6A) Distribution and Shareholders Services
Agreement (5)
(6B) Dealer Sales Agreement (7)
(6C) Shareholder Services Agreement (7)
(8) Custodian Agreement (4)
(9) Administrative Agreement (4)
(11) Consent of Independent Auditors (7)
(15) Plan of Distribution (5)
(16) Calculations of Total Returns (2)
(99) Annual Report (6)
____________________
(1) Incorporated by reference in Part B of the Registration
Statement.
(2) Incorporated by reference to Post-Effective Amendment No. 3
to Registrant's Registration Statement on Form N-1A filed on
March 31, 1988.
(3) Incorporated by reference to Post-Effective Amendment No. 13
to Registrant's Registration Statement on Form N-1A filed on
June 3, 1993.
(4) Incorporated by reference to Post-Effective Amendment No. 15
to Registrant's Registration Statement on Form N-1A filed on
November 18, 1994.
(5) Incorporated by reference to Post-Effective Amendment No. 17
to Registrant's Registration Statement on Form N-1A filed on
June 1, 1995.
(6) Incorporated by reference to the Annual Report filed
electronically on Form N-30D on March 29, 1996.
(7) Incorporated by reference to Post-Effective Amendment No. 19
to Registrant's Registration Statement on Form N-1A filed on
April 1, 1996.
<PAGE>
Item 25. Persons Controlled by or Under Common Control with
Registrant.
See the sections of the Prospectus entitled "Management" and
"Description of Common Stock" and the section of the Statement of
Additional Information entitled "Management," filed as part of
this Registration Statement.
Item 26. Number of Holders Securities.
<TABLE>
<CAPTION>
Number of Record Holders
Portfolio Title of Class as of February 29, 1996
- ---------- -------------- -----------------------
<S> <C> <C>
IAI International Fund Common Stock 3,121
(Series A)
IAI Developing
Countries Fund Common Stock 548
(Series B)
</TABLE>
Item 27. Indemnification.
Article 7(d) of the Registrant's Articles of Incorporation
provide that the Registrant shall indemnify such persons for such
expenses and liabilities, in such manner, under such
circumstances, and to the full extent permitted by Section
302A.521 of the Minnesota Statutes, as now enacted or hereafter
amended; provided, however, that no such indemnification may be
made if it would be in violation of Section 17(h) of the
Investment Company Act of 1940, as now enacted or hereinafter
amended, and any rules, regulations, or releases promulgated
thereunder.
Section 302A.521 of the Minnesota Statutes provides:
Subdivision 1. Definitions. (a) For purposes of this
section, the terms defined in this subdivision have the meanings
given them.
(b) "Corporation" includes a domestic or foreign
corporation that was the predecessor of the corporation referred
to in this section in a merger or other transaction in which the
predecessor's existence ceased upon consummation of the
transaction.
(c) "Official capacity means (1) with respect to a
director, the position of director in a corporation, (2) with
respect to a person other than a director, the elective or
appointive office or position held by an officer, member of a
committee of the board, or the employment relationship undertaken
by an employee of the corporation, and (3) with respect to a
director, officer or employee of the corporation who, while a
director, officer, or employee of the corporation, is or was
serving at the request of the corporation or whose duties in that
position involve or involved service as a director, officer,
partner, trustee, employee, or agent of another organization or
employee benefit plan, the position of that person as a director,
officer, partner, trustee, employee, or agent, as the case may
be, of the other organization or employee benefit plan.
(d) "Proceeding" means a threatened, pending, or completed
civil, criminal, administrative, arbitration, or investigative
proceeding, including a proceeding by or in the right of the
corporation.
(e) "Special legal counsel" means counsel who has not
represented the corporation or a related organization, or a
director, officer, member of a committee of the board, or
employee, whose indemnification is in issue.
Subd. 2. Indemnification mandatory; standard. (a) Subject
to the provisions of subdivision 4, a corporation shall indemnify
a person made or threatened to be made a party to a proceeding by
reason of the former or present official capacity of the person
against judgments, penalties, fines, including, without
limitation, excise taxes assessed against the person with respect
to an employee benefit plan, settlements, and reasonable
expenses, including attorneys' fees and disbursements, incurred
by the person in connection with the proceeding, if, with respect
to the acts or omissions of the person complained of in the
proceeding, the person:
2
<PAGE>
(1) Has not been indemnified by another organization or
employee benefit plan for the same judgments, penalties, fines,
including, without limitation, excise taxes assessed against the
person with respect to an employee benefit plan, settlements, and
reasonable expenses, including attorneys' fees and disbursements,
incurred by the person in connection with the proceeding with
respect to the same acts or omissions;
(2) Acted in good faith;
(3) Received no improper personal benefit and section
302A.255, if applicable, has been satisfied;
(4) In the case of a criminal proceeding, had no
reasonable cause to believe the conduct was unlawful; and
(5) In the case of acts or omissions occurring in the
official capacity described in subdivision 1, paragraph (c),
clause (1) or (2), reasonably believed that the conduct was in
the best interests of the corporation, or in the case of acts or
omissions occurring in the official capacity described in
subdivision 1, paragraph (c), clause (3), reasonably believed
that the conduct was not opposed to the best interests of the
corporation. If the person's acts or omissions complained of in
the proceeding relate to conduct as a director, officer, trustee,
employee, or agent of an employee benefit plan, the conduct is
not considered to be opposed to the best interests of the
corporation if the person reasonably believed that the conduct
was in the best interests of the participants or beneficiaries of
the employee benefit plan.
(b) The termination of a proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent does not, of itself, establish that the person did not
meet the criteria set forth in this subdivision.
Subd. 3. Advances. Subject to the provisions of
subdivision 4, if a person is made or threatened to be made a
party to a proceeding, the person is entitled, upon written
request to the corporation, to payment or reimbursement by the
corporation of reasonable expenses, including attorneys' fees and
disbursements, incurred by the person in advance of the final
disposition of the proceeding, (a) upon receipt by the
corporation of a written affirmation by the person of a good
faith belief that the criteria for indemnification set forth in
subdivision 2 have been satisfied and a written undertaking by
the person to repay all amounts so paid or reimbursed by the
corporation, if it is ultimately determined that the criteria for
indemnification have not been satisfied, and (b) after a
determination that the facts then known to those making the
determination would not preclude indemnification under this
section. The written undertaking required by clause (a) is an
unlimited general obligation of the person making it, but need
not be secured and shall be accepted without reference to
financial ability to make the repayment.
Subd. 4. Prohibition or limit on indemnification or
advances. The articles or bylaws either may prohibit
indemnification or advances of expenses otherwise required by
this section or may impose conditions on indemnification or
advances of expenses in addition to the conditions contained in
subdivisions 2 and 3 including, without limitation, monetary
limits on indemnification or advances of expenses, if the
conditions apply equally to all persons or to all persons within
a given class. A prohibition or limit on indemnification or
advances may not apply to or affect the right of a person to
indemnification or advances of expenses with respect to any acts
or omissions of the person occurring prior to the effective date
of a provision in the articles or the date of adoption of a
provision in the bylaws establishing the prohibition or limit on
indemnification or advances.
Subd. 5. Reimbursement to witnesses. This section does
not require, or limit the ability of, a corporation to reimburse
expenses, including attorneys' fees and disbursements, incurred
by a person in connection with an appearance as a witness in a
proceeding at a time when the person has not been made or
threatened to be made a party to a proceeding.
Subd. 6. Determination of eligibility. (a) All
determinations whether indemnification of a person is required
because the criteria set forth in subdivision 2 have been
satisfied and whether a person is entitled
3
<PAGE>
to payment or reimbursement of expenses in advance of the final
disposition of a proceeding as provided in subdivision 3 shall be made:
(1) By the board by a majority of a quorum, if the
directors who are at the time parties to the proceeding are not
counted for determining either a majority or the presence of a
quorum;
(2) If a quorum under clause (1) cannot be obtained, by a
majority of a committee of the board, consisting solely of two or
more directors not at the time parties to the proceeding, duly
designated to act in the manner by a majority of the full board
including directors who are parties;
(3) If a determination is not made under clause (1) or (2),
by special legal counsel, selected either by a majority of the
board or a committee by vote pursuant to clause (1) or (2) or, if
the requisite quorum of the full board cannot be obtained and the
committee cannot be established, by a majority of the full board
including directors who are parties;
(4) If a determination is not made under clauses (1) to
(3), by the shareholders, but the shares held by parties to the
proceeding must not be counted in determining the presence of a
quorum and are not considered to be present and entitled to vote
on the determination; or
(5) If an adverse determination is made under clauses (1)
to (4) or under paragraph (b), or if no determination is made
under clauses (1) to (4) or under paragraph (b) within 60 days
after (i) the later to occur of the termination of a proceeding
or a written request for indemnification to the corporation or
(ii) a written request for an advance of expenses, as the case
may be, by a court in this state, which may be the same court in
which the proceeding involving the person's liability took place,
upon application of the person and any notice the court requires.
The person seeking indemnification or payment or reimbursement of
expenses pursuant to this clause has the burden of establishing
that the person is entitled to indemnification or payment or
reimbursement of expenses.
(b) With respect to a person who is not, and was not at the
time of the acts or omissions complained of in the proceedings, a
director, officer, or person possessing, directly or indirectly,
the power to direct or cause the direction of the management or
policies of the corporation, the determination whether
indemnification of this person is required because the criteria
set forth in subdivision 2 have been satisfied and whether this
person is entitled to payment or reimbursement of expenses in
advance of the final disposition of a proceeding as provided in
subdivision 3 may be made by an annually appointed committee of
the board, having at least one member who is a director. The
committee shall report at least annually to the board concerning
its actions.
Subd. 7. Insurance. A corporation may purchase and
maintain insurance on behalf of a person in that person's
official capacity against any liability asserted against and
incurred by the person in or arising from that capacity, whether
or not the corporation would have been required to indemnify the
person against the liability under the provisions of this
section.
Subd. 8. Disclosure. A corporation that indemnifies or
advances expenses to a person in accordance with this section in
connection with a proceeding by or on behalf of the corporation
shall report to the shareholders in writing the amount of the
indemnification or advance and to whom and on whose behalf it was
paid not later than the next meeting of shareholders.
Subd. 9. Indemnification of other persons. Nothing in
this section shall be construed to limit the power of the
corporation to indemnify other persons by contract or otherwise.
The Registrant undertakes that:
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification
4
<PAGE>
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 of paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, 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.
In addition to the foregoing, Registrant has obtained Errors
and Omissions and Director and Officer Insurance. In obtaining
such insurance, the directors have determined that coverage
should be obtained for certain individuals associated with the
Registrant. The Board of Directors for the Registrant review no
less frequently than annually the determination that such
coverage be maintained.
Item 28. Business and Other Connections of Investment Adviser.
Information on the business of Investment Advisers, Inc.
("IAI") is described in the Prospectus section "Management" and
in Part B of this Registration Statement in the section
"Management."
The senior officers and directors of IAI and their titles
are as follows:
<TABLE>
<CAPTION>
Name Title
---- -----
<S> <C>
Jeffrey R. Applebaum Senior Vice President
Charles P. Barrington Director
Scott Allen Bettin Senior Vice President
Archi Campbel Black, III Senior Vice President/Treasurer
Stephen C. Coleman Senior Vice President
Hugh Freedberg Chairman
Larry Ray Hill Executive Vice President/Director
Richard A. Holway Senior Vice President
Irving Philip Knelman Executive Vice President/Director
Rick D. Leggott Senior Vice President
Timothy A. Palmer Senior Vice President
Douglas Rugh Platt Senior Vice President
Andrew Scott Plummer Director
Noel Paul Rahn Chief Executive Officer/Director
James S. Sorenson Senior Vice President
R. David Spreng Senior Vice President
Christopher John Smith Senior Vice President/Secretary
Eric St. C. Stobart Director
Richard Edward Struthers Executive Vice President/Director
Suzanne F. Zak Senior Vice President
</TABLE>
All of such persons have been affiliated with IAI for more
than two years except Messrs. Barrington, Freedberg, Plummer and
Stobart. Prior to being appointed to the Board in 1994, Mr.
Barrington was and remains Managing Director of Hill Samuel Bank,
100 Wood Street, London, England EC2P 2AJ, since 1991. Prior to
being appointed to the Board in 1994, Mr. Freedberg was and
remains Chief Executive Officer of Hill Samuel Bank, 100 Wood
Street, London, England EC2P 2AJ, since 1991. Prior to being
appointed to the Board in 1994, Mr. Plummer was and remains Legal
Adviser to Lloyds TSB Group plc, 60 Lombard Street, London,
England EC3V 9DN, since 1988. Prior to being appointed to the
Board in 1994, Mr. Stobart was and remains Director of Hill
Samuel Bank, 100 Wood Street, London, England EC2P 2AJ, since
1977.
5
<PAGE>
Certain directors and officers of IAI are directors and/or
officers of the Registrant, as described in the section of the
Statement of Additional Information entitled "Management," filed
as a part of this Registration Statement.
The address of the officers and directors of IAI is that of
IAI, which is 3700 First Bank Place, P. O. Box 357, Minneapolis,
Minnesota 55440.
Certain of the officers and directors of IAI also serve as
officers and directors of IAI International Ltd. Both IAI and
IAI International are wholly-owned subsidiaries of Hill Samuel
Group BV, a London-based merchant banking and financial services
firm which, in turn, is owned by Lloyds TSB Group plc, a publicly-
held financial services organization based in London, England.
The senior officers and directors of IAI International and their
titles are as follows:
<TABLE>
<CAPTION>
Name Title
- ---- -----
<S> <C>
Noel Paul Rahn Chairman of the Board of Directors
Roy C. Gillson Chief Investment Officer/Director
Irving Philip Knelman Director
Hilary Fane Deputy Chief Investment Officer/Director
Feidhlim O'Broin Associate Director
</TABLE>
Certain of the officers and directors of IAI also serve as
officers and directors of IAI Trust Company, a wholly-owned
subsidiary of IAI. The officers and directors of IAI Trust
Company and their titles are as follows:
<TABLE>
<CAPTION>
Name Title
- ---- -----
<S> <C>
Richard E. Struthers Chairman of the Board
Christopher J. Smith Director/Secretary
Archie C. Black Director/Treasurer
Christie Haagensen Director of Trust Services
</TABLE>
6
<PAGE>
Item 29. Principal Underwriters
(a) Not applicable
(b) The officers and directors of IAI Securities and the
positions, if any, such officers and directors hold with the
Registrant are set forth below. The business address of such
persons is 3700 First Bank Place, Minneapolis, Minnesota 55402.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and
Business Address with Underwriter with Registrant
- ------------------ --------------------- ----------------
<S> <C> <C>
Noel P. Rahn Chairman of the Board Chairman of the Board
Richard E. Struthers President/Director President/Director
Douglas R. Platt Vice President/Director None
R. David Spreng Vice President/Director None
Christopher J. Smith Secretary None
Archie C. Black, III CFO/Treasurer Treasurer
William C. Joas Chief Compliance Officer Secretary
</TABLE>
Item 30. Location of Accounts and Records.
The Custodian for Registrant is Norwest Bank Minnesota,
N.A., Norwest Center, Sixth & Marquette, Minneapolis, Minnesota
55479. The Custodian maintains records of all cash transactions
of Registrant. All other books and records of Registrant,
including books and records of Registrant's investment
portfolios, are maintained by IAI. IAI also acts as Registrant's
transfer agent and dividend disbursing agent, at 3700 First Bank
Place, Minneapolis, Minnesota 55402.
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
(a) Not applicable.
(b) Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of its latest annual report
to shareholders, upon request and without charge.
7
<PAGE>
