<PAGE>
THE SEVEN SEAS SERIES FUND
SUPPLEMENT DATED MAY 12, 1995 TO PROSPECTUS DATED NOVEMBER 25, 1994
FUND OPERATING EXPENSES
THE SEVEN SEAS SERIES SHORT TERM GOVERNMENT SECURITIES FUND
The following table has been adjusted to reflect current fees, the removal of
the advisory fee waiver and the commencement of an advisory fee reimbursement.
The purpose of the table is to assist the investor in understanding the
various costs and expenses that an investor in the Government Securities Fund
will incur directly or indirectly. The examples provided in the table should
not be considered a representation of past or future expenses. Actual
expenses may be greater or less than those shown. For additional information,
see Prospectus Section -- "General Management."
<TABLE>
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees None
Exchange Fee None
ANNUAL FUND OPERATING EXPENSES:
(as a percentage of average daily net assets)
Advisory Fees .50%
12b-1 Fees(1) .16
Other Expenses:
Administrative Fees .03%
Custodian Fees .14
Other Fees and Expenses .41
----
Total Other Expenses .58
----
Total Operating Expenses Before Fee Waiver
and Reimbursement 1.24
Fees Waived by Custodian(2) (.01)
Expense Reimbursement from Advisor(2) (.23)
----
Total Operating Expenses After Fee Waiver
and Reimbursement(3) 1.00%
----
EXAMPLES: 1 year 3 years 5 years 10 years
------ ------- ------- --------
You would pay the following
expenses on a $1,000
investment, assuming (i) 5%
annual return and (ii)
redemption at the end of
each time period: $10 $32 $55 $122
------ ------- ------- --------
_________________________
<FN>
(1) 12b-1 fees may include expenses paid for shareholder servicing
activities.
(2) Advisor has voluntarily agreed to reimburse the Fund for all
daily expenses that exceed 1.00% on an annual basis. This
agreement will remain in effect until further notice.
Additionally, the Custodian has voluntarily agreed to waive one-
half of its asset-based fee.
(3) The expense information in the table has been restated to
reflect current fees. Investors purchasing Fund shares through
a financial intermediary, such as a bank or an investment
adviser, may also be required to pay additional fees for
services provided by the intermediary. Such investors should
contact the intermediary for information concerning what
additional fees, if any, will be charged.
</TABLE>
Long-term shareholders of the Fund may pay more in Rule 12b-1
fees than the economic equivalent of the maximum front-end sales
charge applicable to mutual fund securities sold by members of
the National Association of Securities Dealers, Inc.
<PAGE>
Filed pursuant to Rule 497(c)
File Nos. 33-19229; 811-5430
THE SEVEN SEAS SERIES FUND
Two International Place, 35th Floor
Boston, Massachusetts 02110
(617) 654-6089
SHORT TERM GOVERNMENT SECURITIES FUND
The Seven Seas Series Fund is a series mutual fund. This Prospectus
describes and offers shares of beneficial interest in one portfolio, The
Seven Seas Series Short Term Government Securities Fund (referred to in this
Prospectus as the "Government Securities Fund" or the "Fund"). The
Government Securities Fund seeks to provide a high level of current income
consistent with safety of principal and maintenance of liquidity by actively
investing in fixed income obligations with average maturities not in excess
of three years which are issued by the US Government or its agencies and
instrumentalities. The Fund's shares are offered without sales commissions.
However, the Fund pays certain distribution expenses under its Rule 12b-1
plan.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR BY ANY STATE SECURITIES COMMISSION NOR HAS ANY
SUCH COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SHARES IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, STATE STREET BANK AND TRUST COMPANY, AND SHARES ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE
FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, AND INVOLVE INVESTMENT RISKS
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
This Prospectus sets forth concisely the information about the Fund that
a prospective investor ought to know before investing. Please read and
retain this document for future reference. Additional information about
the Fund has been filed with the Securities and Exchange Commission in a
Statement of Additional Information dated November 25, 1994. The Statement
of Additional Information is incorporated herein by reference and is
available without charge from Distributor at its address noted below or by
calling (617) 654-6089.
<TABLE>
<C> <S> <S>
Investment Adviser, Custodian
and Transfer Agent: Distributor: Administrator:
State Street Bank and Trust Company Russell Fund Distributors, Inc. Frank Russell Investment Management Company
225 Franklin Street Two International Place, 35th Fl. 909 A Street
Boston, Massachusetts 02110 Boston, Massachusetts 02110 Tacoma, Washington 98402
(617) 654-4721 (617) 654-6089 (206) 627-7001
</TABLE>
PROSPECTUS DATED NOVEMBER 25, 1994
-1-
<PAGE>
TABLE OF CONTENTS
Page
----
Fund Operating Expenses........................................3
Financial Highlights...........................................4
The Seven Seas Series Fund.....................................5
Manner of Offering.............................................5
Investment Objective, Policies and Restrictions................5
Certain Risk Factors..........................................10
Portfolio Turnover............................................10
Dividends and Distributions...................................10
Taxes.........................................................11
Valuation of Fund Shares......................................12
Purchase of Fund Shares.......................................12
Redemption of Fund Shares.....................................14
General Management............................................15
Fund Expenses.................................................18
Performance Calculations......................................19
Additional Information........................................19
-2-
<PAGE>
FUND OPERATING EXPENSES
THE SEVEN SEAS SERIES SHORT TERM GOVERNMENT SECURITIES FUND
The purpose of the following table is to assist the investor in understanding
the various costs and expenses that an investor in the Government Securities
Fund will incur directly or indirectly. The examples provided in the table
should not be considered a representation of past or future expenses. Actual
expenses may be greater or less than those shown. For additional information,
see Prospectus Section -- "General Management."
<TABLE>
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees None
Exchange Fee None
ANNUAL FUND OPERATING EXPENSES:
(as a percentage of average daily net assets)
Advisory Fees .50%
12b-1 Fees(1) .10
Other Expenses:
Administrative Fees .03%
Custodian Fees .10
Other Fees and Expenses .23
Total Other Expenses .36
-----
Total Operating Expenses Before Fee Waivers .96
Fees Waived(2) (.26)
-----
Total Operating Expenses After Fee Waivers(3) .70%
-----
EXAMPLES: 1 year 3 years 5 years 10 years
------ ------- ------- --------
You would pay the following
expenses on a $1,000 investment,
assuming (i) 5% annual return and
(ii) redemption at the end of each
time period: $7 $22 $39 $87
------ ------- ------- --------
_________________________
<FN>
(1) 12b-1 fees may include expenses paid for shareholder servicing activities.
(2) Adviser has voluntarily agreed to waive one-half of its
advisory fee. This agreement will remain in effect until
further notice. Additionally, the Custodian has voluntarily
agreed to waive one-half of its asset-based fee until the Fund
reaches net assets of $50 million.
(3) The expense information in the table has been restated to
reflect current fees. Investors purchasing Fund shares through
a financial intermediary, such as a bank or an investment
adviser, may also be required to pay additional fees for
services provided by the intermediary. Such investors should
contact the intermediary for information concerning what
additional fees, if any, will be charged.
</TABLE>
Long-term shareholders of the Fund may pay more in Rule 12b-1
fees than the economic equivalent of the maximum front-end sales
charge applicable to mutual fund securities sold by members of
the National Association of Securities Dealers, Inc.
-3-
<PAGE>
FINANCIAL HIGHLIGHTS
THE SEVEN SEAS SERIES SHORT TERM GOVERNMENT SECURITIES FUND
The following table includes selected data for a share outstanding throughout
each fiscal year or period ended August 31, and other performance information
derived from the financial statements. More detailed information concerning
the Fund's performance, a complete portfolio listing and audited financial
statements are available in the Fund's Annual Report dated August 31, 1994
which may be obtained without charge by writing or calling the Distributor.
<TABLE>
<S> <C> <C> <C>
1994 1993 1992++
------- ------- -------
NET ASSET VALUE,
BEGINNING OF YEAR: $10.23 $10.21 $10.00
------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income .43 .45 .18
Net realized and unrealized
gain (loss) on investments (.31) .05 .17
------- ------- -------
Total From Investment Operations .12 .50 .35
------- ------- -------
LESS DISTRIBUTIONS:
Net investment income (.43) (.46) (.14)
Net realized gain on investments (.17) (.02) --
In excess of net realized
gain on investments (.09) -- --
------- ------- -------
Total Distributions (.69) (.48) (.14)
------- ------- -------
NET ASSET VALUE, END OF YEAR $9.66 $10.23 $10.21
------- ------- -------
TOTAL RETURN (%)(a) 1.28 5.06 3.49
RATIOS (%)/SUPPLEMENTAL DATA:
Operating expenses, net, to
average daily net
assets(b)(c)(d) .70 .64 .51
Net investment income to average
daily net assets(b)(c) 4.58 4.62 4.53
Portfolio turnover(c) 279.07 69.09 96.54
Net assets, end of year
($000 omitted) 25,720 35,474 55,118
- -----------------------------
<FN>
++ For the period April 15, 1992 (commencement of operations) to
August 31, 1992.
(a) Periods less than one year are not annualized.
(b) For the fiscal year ended August 31, 1994, the Adviser and
Custodian waived a portion of their fees amounting to $.0236
and $.0008 per share, respectively. For the fiscal year
ended August 31, 1993, the Adviser and Custodian waived a
portion of their fees amounting to $.0276 and $.0004 per
share, respectively. For the period April 15, 1992
(commencement of operations) to August 31, 1992, the Adviser,
Custodian and Administrator waived a portion of their fees
amounting to $.0097, $.0005 and $.0002 per share, respectively.
(c) The ratios for the period ended August 31, 1992 are annualized.
(d) Operating expense ratio before any waivers and/or
reimbursements amounted to .96% for the fiscal year ended
August 31, 1994.
</TABLE>
-4-
<PAGE>
THE SEVEN SEAS SERIES FUND
The Seven Seas Series Fund ("Investment Company") is an open-end
management investment company that is organized and operates as a
Massachusetts business trust under a First Amended and Restated Master Trust
Agreement dated October 13, 1993, as amended. In addition, each series of
the Investment Company is diversified as defined in the Investment Company
Act of 1940, as amended ("1940 Act"). As a "series mutual fund," Investment
Company is authorized to issue an unlimited number of shares evidencing
beneficial interests in different investment portfolios. Through this
Prospectus, Investment Company offers shares in one such portfolio, The Seven
Seas Series Short Term Government Securities Fund.
MANNER OF OFFERING
DISTRIBUTION AND ELIGIBLE INVESTORS. Shares of the Fund are offered
without a sales commission by Russell Fund Distributors, Inc., Investment
Company's distributor, to US or foreign institutional and retail investors
that invest for their own account or in a fiduciary or agency capacity. The
Fund will incur distribution expenses under a 12b-1 plan. See "General
Management -- Distribution Services."
MINIMUM AND SUBSEQUENT INVESTMENT. The Fund requires a minimum initial
investment of $1,000. A shareholder's investment in the Fund may be subject
to redemption at the Fund's discretion if the account balance is less than
$500 as a result of shareholder redemptions. The Fund reserves the right to
reject any purchase order.
INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS
The Government Securities Fund's fundamental investment objective is to
seek a high level of current income consistent with safety of principal and
maintenance of liquidity by actively investing in fixed income obligations
with average maturities not in excess of three years that are issued or
guaranteed as to principal and interest by the US Government or its agencies
and instrumentalities. This objective may be changed only with the approval
of a majority of the Fund's shareholders as defined by the 1940 Act. There
can be no assurance that the Fund will meet its investment objective.
The Fund attempts to meet its investment objective by primarily
investing in obligations issued or guaranteed as to principal and interest by
the U.S. Government or its agencies or instrumentalities or in repurchase
agreements secured by such instruments. (See "Investment Policies -- US
Government Securities.") Under normal market conditions, it is Investment
Company's policy that the Fund will be 100% invested in such securities.
The dollar weighted average maturity of the Fund will not exceed three
years.
-5-
<PAGE>
INVESTMENT POLICIES
The investment policies described below reflect the Fund's current
practices and are not fundamental. Investment policies may be changed by the
Board of Trustees of Investment Company without shareholder approval. To the
extent consistent with the Fund's fundamental investment objective and
restrictions the Fund may invest in the following instruments and may use the
following investment techniques:
US GOVERNMENT SECURITIES. US Government securities include US Treasury
bills, notes, and bonds and other obligations issued or guaranteed as to
interest and principal by the US Government and its agencies and
instrumentalities. Obligations issued or guaranteed as to interest and
principal by the US Government, its agencies and instrumentalities include
securities that are supported by the full faith and credit of the United
States Treasury, securities that are supported by the right of the issuer to
borrow from the United States Treasury, discretionary authority of the US
Government agency or instrumentality, and securities supported solely by the
creditworthiness of the issuer.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements
with banks and other financial institutions, such as broker-dealers. Under
these agreements, the Fund purchases securities from financial institutions
that agree to repurchase the securities at the Fund's cost plus interest
within a specified time (normally one day). The Fund will not invest more
than 10% of its net assets (taken at current market value) in repurchase
agreements maturing in more than seven days. The Fund will enter into
repurchase agreements only with financial institutions that Adviser
determines are creditworthy. Should the parties to these transactions fail
financially, the Fund may experience delays in realizing on the collateral
securing the borrowers' obligations or loss of rights in such collateral.
Further, any amounts realized upon the sale of collateral may be less than
that necessary to fully compensate the Fund.
REVERSE REPURCHASE AGREEMENTS. The Fund may enter into reverse
repurchase agreements under the circumstances described in "Investment
Restrictions". Under reverse repurchase agreements, the Fund transfers
possession of portfolio securities to banks in return for cash in an amount
equal to a percentage of the portfolio securities' market value and agrees to
repurchase the securities at a future date by repaying the cash with
interest. The Fund retains the right to receive interest and principal
payments from the securities while they are in the possession of the
financial institutions. Cash or liquid high quality debt obligations from a
Fund's portfolio equal in value to the repurchase price including any accrued
interest will be segregated by Custodian on the Fund's records while a
reverse repurchase agreement is in effect. Reverse repurchase agreements
involve the risk that the market value of securities sold by the Fund may
decline below the price at which it is obligated to repurchase the securities.
FORWARD COMMITMENTS. The Fund may contract to purchase securities for a
fixed price at a future date beyond customary settlement time, provided that
the forward commitment is consistent with the Fund's ability to manage its
investment portfolio, maintain a stable net asset value and honor redemption
requests. When effecting such transactions, cash or liquid high quality debt
obligations held by the Fund of a dollar amount sufficient to make payment
for the
-6-
<PAGE>
portfolio securities to be purchased will be segregated on the Fund's
records at the trade date and maintained until the transaction is settled.
The failure of the other party to the transaction to complete the transaction
may cause the Fund to miss an advantageous price or yield. The Fund bears the
risk of price fluctuations during the period between the trade and settlement
dates.
WHEN-ISSUED TRANSACTIONS. The Fund may purchase securities on a
when-issued basis. In these transactions, the Fund purchases securities with
payment and delivery scheduled for a future time. Until settlement, the Fund
segregates cash and marketable high quality debt securities equal in value to
their when-issued commitments. Between the trade and settlement dates, the
Fund bears the risk of any fluctuation in the value of the securities. These
transactions involve the additional risk that the other party may fail to
complete the transaction and cause the Fund to miss a price or yield
considered advantageous. The Fund will engage in when-issued transactions
only for the purpose of acquiring portfolio securities consistent with its
investment objective and policies and not for investment leverage. The Fund
will not invest more than 25% of its net assets in when-issued securities.
ILLIQUID SECURITIES. The Fund will not invest more than 10% of its net
assets in illiquid securities or securities that are not readily marketable,
including repurchase agreements and time deposits of more than seven days'
duration. The absence of a regular trading market for illiquid securities
imposes additional risks on investments in these securities. Illiquid
securities may be difficult to value and may often be disposed of only after
considerable expense and delay.
VARIABLE AMOUNT MASTER DEMAND NOTES. Variable amount master demand notes
are unsecured obligations that are redeemable upon demand and are typically
unrated. These instruments are issued pursuant to written agreements between
their issuers and holders. The agreements permit the holders to increase
(subject to an agreed maximum) and the holders and issuers to decrease the
principal amount of the notes, and specify that the rate of interest payable
on the principal fluctuates according to an agreed formula.
MORTGAGE-RELATED PASS-THROUGH SECURITIES. The Fund may invest in
mortgage-related securities, including Government National Mortgage
Association ("GNMA") Certificates ("Ginnie Maes"), Federal Home Loan Mortgage
Corporation ("FHLMC") Mortgage Participation Certificates ("Freddie Macs")
and Federal National Mortgage Association ("FNMA") Guaranteed Mortgage
Pass-Through Certificates ("Fannie Maes"). Mortgage pass-through certificates
are mortgage-backed securities representing undivided fractional interests in
pools of mortgage-backed loans. These loans are made by mortgage bankers,
commercial banks, savings and loan associations and other lenders. Ginnie
Maes are guaranteed by the full faith and credit of the US Government, but
Freddie Macs and Fannie Maes are not.
ZERO COUPON SECURITIES. Zero coupon securities are notes, bonds and
debentures that: (1) do not pay current interest and are issued at a
substantial discount from par value; (2) have been stripped of their
unmatured interest coupons and receipts; or (3) pay no interest until a
stated date one or more years into the future. These securities also
include certificates representing interests in such stripped coupons and
receipts.
-7-
<PAGE>
VARIABLE AND FLOATING RATE SECURITIES. A floating rate security provides
for the automatic adjustment of its interest rate whenever a specified
interest rate changes. A variable rate security provides for the automatic
establishment of a new interest rate on set dates. Interest rates on these
securities are ordinarily tied to, and are a percentage of, a widely
recognized interest rate, such as the yield on 90-day US Treasury bills or
the prime rate of a specified bank. These rates may change as often as twice
daily. Generally, changes in interest rates will have a smaller effect on the
market value of variable and floating rate securities than on the market
value of comparable fixed income obligations. Thus, investing in variable and
floating rate securities generally allows less opportunity for capital
appreciation and depreciation than investing in comparable fixed income
securities.
FUTURES CONTRACTS AND OPTIONS ON FUTURES. For hedging purposes,
including protecting the price or interest rate of a security that the Fund
intends to buy, the Fund may enter into futures contracts that relate to
securities in which it may directly invest and indices comprised of such
securities and may purchase and write call and put options on such contracts.
A financial futures contract is a contract to buy or sell a specified
quantity of financial instruments such as US Treasury bills, notes and bonds,
commercial paper and bank certificates of deposit or the cash value of a
financial instrument index at a specified future date at a price agreed upon
when the contract is made. Under such contracts no delivery of the actual
securities making up the index takes place. Rather, upon expiration of the
contract, settlement is made by exchanging cash in an amount equal to the
difference between the contract price and the closing price of the index at
expiration, net of variation margin previously paid.
Substantially all futures contracts are closed out before settlement
date or called for cash settlement. A futures contract is closed out by
buying or selling an identical offsetting futures contract. Upon entering
into a futures contract, the Fund is required to deposit an initial margin
with Custodian for the benefit of the futures broker. The initial margin
serves as a "good faith" deposit that the Fund will honor its futures
commitments. Subsequent payments (called "variation margin") to and from the
broker are made on a daily basis as the price of the underlying investment
fluctuates.
Options on futures contracts give the purchaser the right to assume a
position at a specified price in a futures contract at any time before
expiration of the option contract.
When trading futures contracts, the Fund will not commit more than 5% of
the market value of its total assets to initial margin deposits on futures
and premiums paid for options on futures.
OPTIONS ON SECURITIES AND SECURITIES INDICES. The Fund may write and
purchase covered put and call options on securities in which they may
directly invest. Option transactions of the Fund will be conducted so that
the total amount paid on premiums for all put and call options outstanding
will not exceed 5% of the value of the Fund's total assets. Further, the Fund
will not write a put or call option or combination thereof if, as a result,
the aggregate value of all
-8-
<PAGE>
securities or collateral used to cover its outstanding options would exceed
25% of the value of the Fund's total assets.
The Fund may purchase or sell options on securities indices that are
comprised of securities in which the Fund may directly invest, subject to the
limitations set forth above and provided such options are traded on a
national securities exchange or in the over-the-counter market. Options on
securities indices are similar to options on securities except there is no
transfer of a security and settlement is in cash. A call option on a
securities index grants the purchaser of the call, for a premium paid to the
seller, the right to receive in cash an amount equal to the difference
between the closing value of the index and the exercise price of the option
times a multiplier established by the exchange upon which the option is
traded.
LENDING PORTFOLIO SECURITIES. The Fund may lend portfolio securities
with a value of up to 33-1/3% of its total assets. Such loans may be
terminated at any time. The Fund will continuously maintain as collateral
cash or obligations issued by the US Government, its agencies or
instrumentalities in an amount equal to not less than 100% of the current
market value (on a daily marked-to-market basis) of the loaned securities
plus accrued interest.
The Fund will retain most rights of beneficial ownership, including the
right to receive dividends, interest and other distributions on the loaned
securities. However, the borrower has the right to vote the loaned
securities. The Fund will call loans to vote proxies if a material issue
affecting the investment is to be voted upon. Should the borrower of the
securities fail financially, the Fund may experience delay in recovering the
securities or exercising its rights in the collateral. Loans are made only to
borrowers that are deemed by Adviser to be of good financial standing.
CASH RESERVES. For defensive purposes, the Fund may temporarily invest,
without limitation, in certain high quality short-term fixed income
securities. These securities include obligations issued or guaranteed as to
principal and interest by the US Government, its agencies and
instrumentalities and repurchase agreements collateralized by these
obligations, commercial paper, bank certificates of deposit, bankers'
acceptances and time deposits. When using this strategy, the weighted average
maturity of securities held by the Fund will decline, and thereby possibly
cause their yields to decline as well.
INVESTMENT RESTRICTIONS
The Fund has fundamental investment restrictions, which may be changed
only with the approval of a majority of the Fund's shareholders as defined in
the 1940 Act. A more detailed discussion of the Fund's investment
restrictions and investment policies appears in the Statement of Additional
Information. Unless otherwise noted, the fundamental restrictions apply at
the time an investment is made. The Fund may not:
1. Invest 25% or more of the value of its total assets
in securities of companies primarily engaged in any one
industry (other than the US Government, its agencies
and instrumentalities). Concentration may occur as a
result of changes in the market value of portfolio
securities, but may not result from investment.
-9-
<PAGE>
2. Borrow money (including reverse repurchase
agreements), except as a temporary measure for
extraordinary or emergency purposes or to facilitate
redemptions (not for leveraging or investment),
provided that borrowings do not exceed an amount equal
to 33-1/3% of the current value of the Fund's assets
taken at market value, less liabilities other than
borrowings. If at any time the Fund's borrowings
exceed this limitation due to a decline in net assets,
such borrowings will within three days be reduced to
the extent necessary to comply with this limitation.
The Fund will not purchase additional investments if
borrowed funds (including reverse repurchase
agreements) exceed 5% of total assets.
3. Pledge, mortgage, or hypothecate its assets.
However, the Fund may pledge securities having a market
value at the time of the pledge not exceeding 33-1/3%
of the value of the Fund's total assets to secure
borrowings permitted by paragraph (2) above.
CERTAIN RISK FACTORS
There are certain investment risks in using futures contracts and
options as a hedging technique. Such risks may include: (1) the inability to
close out a futures contract or option caused by the nonexistence of a liquid
secondary market; and (2) an imperfect correlation between price movements of
the futures contracts or option with price movements of the portfolio
securities or securities index subject to the hedge.
PORTFOLIO TURNOVER
Due to the short-term maturities of the securities it purchases, the
Fund's rate of portfolio turnover is generally not expected to exceed 150%. A
high turnover rate (over 100%) will: (1) increase transaction expenses which
will adversely affect the Fund's performance; and (2) result in increased
brokerage commissions and other transaction costs, and the possibility of
realized capital gains.
DIVIDENDS AND DISTRIBUTIONS
The Board of Trustees intends to declare dividends on shares of the Fund
from net investment income daily, and have them payable as of the last
business day of each month. Distributions will be made at least annually from
net short and long-term capital gains, if any. In most instances,
distributions will be declared and paid in mid-October with additional
distributions declared and paid in December, if required for the Fund to
avoid imposition of a 4% federal excise tax on undistributed capital gains.
Dividends declared in October, November or December and payable to
shareholders of record in such months will be deemed to have been paid by the
Fund and received by shareholders on December 31 of that year if the dividend
is paid prior to February 1 of the following year.
-10-
<PAGE>
Income dividends and capital gains distributions will be paid in
additional shares at their net asset value on the record date unless the
shareholder has elected to receive them in cash. Such election may be made by
giving 10 days' written notice to Transfer Agent.
Any dividend or capital gain distribution paid by the Fund shortly after
a purchase of shares will reduce the per share net asset value of the Fund by
the amount of the dividend or distribution. In effect, the payment will
represent a return of capital to the shareholder. However, the shareholder
will be subject to taxes with respect to such dividend or distribution.
TAXES
The Fund intends to qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code, as amended. As a regulated
investment company, the Fund will not be subject to federal income taxes to
the extent it distributes its net investment income and capital gain net
income (capital gains in excess of capital losses) to its shareholders. The
Board intends to distribute each year substantially all of the Fund's net
investment income and capital gain net income.
Dividends from net investment income and distributions of net short-term
capital gains are taxable to shareholders as ordinary income under federal
income tax laws whether paid in cash or in additional shares. Distributions
from net long-term capital gains are taxable as long-term capital gains
regardless of the length of time a shareholder has held such shares.
The Fund may purchase bonds at market discount (i.e., bonds with a
purchase price less than original issue price or adjusted issue price). If
such bonds are subsequently sold at a gain then a portion of that gain equal
to the amount of market discount, which should have been accrued through the
sale date, will be taxable to shareholders as ordinary income.
Dividends and distributions may also be subject to state or local taxes.
Depending on the state tax rules pertaining to a shareholder, a portion of
the dividends paid by the Fund attributable to direct obligations of the US
Treasury and certain agencies may be exempt from state and local taxes.
The sale of Fund shares by a shareholder is a taxable event and may
result in capital gain or loss. A capital gain or loss may be realized from
an ordinary redemption of shares or an exchange of shares between two mutual
funds (or two series of portfolios of a mutual fund). Any loss incurred on
sale or exchange of Fund shares held for one year or more will be treated as
a long-term capital loss to the extent of capital gain dividends received
with respect to such shares.
Shareholders will be notified after each calendar year of the amount of
income dividends and net capital gains distributed and the percentage of a
Fund's income attributable to US Treasury and agency obligations. The Fund is
required to withhold 31% of all taxable dividends, distributions and
redemption proceeds payable to any noncorporate shareholder that does not
provide the Fund with the shareholder's correct taxpayer identification
number or certification that the shareholder is not subject to backup
withholding.
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The foregoing discussion is only a summary of certain federal income tax
issues generally affecting the Fund and its shareholders. Circumstances
among investors may vary and each investor is encouraged to discuss
investment in the Fund with the investor's tax adviser.
VALUATION OF FUND SHARES
NET ASSET VALUE PER SHARE. The Fund determines net asset value once each
business day, as of the close of the regular trading session of the New York
Stock Exchange. A business day is one on which the New York Stock Exchange is
open for business (currently 4 p.m. Eastern time). Net asset value per share
is computed by dividing the current value of the Fund's assets, less its
liabilities, by the number of shares of the Fund outstanding and rounding to
the nearest cent.
VALUATION OF FUND SECURITIES. The Fund values securities maturing within
60 days of the valuation date at amortized cost unless the Board determines
that amortized cost does not represent their fair value. The "amortized
cost" valuation procedure initially prices an instrument at its cost and
thereafter assumes a constant amortization to maturity of any discount or
premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. While this method provides certainty in valuation,
it may result in periods during which value, as determined by amortized cost,
is higher or lower than the price the Fund would receive if it sold the
instrument.
With the exceptions noted below, the Fund values portfolio securities
with remaining maturities in excess of 60 days at "fair market value." This
generally means that fixed income securities listed and traded principally
on any national securities exchange are valued on the basis of the last sale
price or, lacking any sales, at the closing bid price, on the primary
exchange on which the security is traded. United States fixed income
securities traded principally over-the-counter and options are valued on the
basis of the last reported bid price. Futures contracts are valued on the
basis of the last reported sale price.
Because many fixed income securities do not trade each day, last sale or
bid prices are frequently not available. Fixed income securities therefore
may be valued using prices provided by a pricing service when such prices are
determined by Custodian to reflect the fair market value of such securities.
The Fund values securities for which market quotations are not readily
available at "fair value," as determined in good faith pursuant to procedures
established by the Board of Trustees.
PURCHASE OF FUND SHARES
MINIMUM INITIAL INVESTMENT AND ACCOUNT BALANCE. The Fund requires a
minimum initial investment of $1,000. The minimum account balance is $500.
The Fund reserves the right to reject any purchase order.
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OFFERING DATES AND TIMES. Fund shares may be purchased on any business
day without a sales commission. All purchases must be made in US dollars.
Purchase orders in good form and payments for Fund shares must be received by
Transfer Agent prior to 4:00 p.m. Eastern time to be effective on the date
received. The accompanying payment must be in federal funds or converted
into federal funds by Transfer Agent before the purchase order can be
accepted. Purchase orders in good form are described below. Purchase orders
which are accepted: (1) prior to 12:00 noon Eastern time will earn the
dividend declared on the date of purchase; and (2) at or after 12:00 noon
Eastern time will earn the dividend determined on the next day.
ORDER AND PAYMENT PROCEDURES. There are several ways to invest in the
Fund. The Fund requires a purchase order in good form which consists of a
completed and signed Account Registration and Investment Instruction Form
("Application") for each new account regardless of the investment method. The
Fund will not permit redemptions until a completed Application is on file.
For additional information, copies of forms or questions, call Transfer Agent
at (800) 647-7327, or write to Transfer Agent at: State Street Bank and
Trust Company, P.O. Box 8317, Boston, MA 02107, Attention: The Seven Seas
Series Short Term Government Securities Fund.
FEDERAL FUNDS WIRE. An investor may purchase shares by wiring federal
funds to State Street Bank and Trust Company as Transfer Agent by:
1. Telephoning State Street Bank and Trust Company at
(800) 647-7327 and stating: (1) the investor's account
registration, address and social security or tax
identification number; (2) the amount being wired;
(3) the name of the wiring bank; (4) the name and
telephone number of the person at the wiring bank to be
contacted in connection with the order; and (5) that
the funds should be invested in The Seven Seas Series
Short Term Government Securities Fund.
2. Instructing the wiring bank to wire federal funds to:
State Street Bank and Trust Company, Boston, MA (ABA
#0110-00028), Attention: The Seven Seas Series Short
Term Government Securities Fund, Mutual Funds Service
Division (DDA #9904-631-0). The wire instructions
should also include the name in which the account is
registered, the account number, and the name of the
Fund in which to be invested.
3. Completing the Application and forwarding it to
Transfer Agent at the above address.
MAIL. To purchase shares by mail, send a check or other negotiable bank
draft payable to: State Street Bank and Trust Company, P.O. Box 8317, Boston,
MA 02107, Attention: The Seven Seas Series Short Term Government Securities
Fund. Certified checks are not necessary; however, all checks are accepted
subject to collection at full face value in United States funds and must be
drawn in United States dollars on a United States bank. Normally, checks and
drafts are converted to federal funds within two business days following
receipt of the check or draft. Initial investments should be accompanied by
a completed Application, and subsequent investments are to be accompanied by
the investor's account number.
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THIRD PARTY TRANSACTIONS. Investors purchasing Fund shares through a
program of services offered by a financial intermediary, such as a bank,
broker-dealer, investment adviser or others, may be required by such
intermediary to pay additional fees. Investors should contact such
intermediary for information concerning what additional fees, if any, may be
charged.
"IN-KIND" EXCHANGE OF SECURITIES. The Transfer Agent may, at its
discretion, permit investors to purchase shares through the exchange of
securities they hold. Any securities exchanged must meet the investment
objective, policies and limitations of the Fund, must have a readily
ascertainable market value, must be liquid and must not be subject to
restrictions on resale. The market value of any securities exchanged, plus
any cash, must be at least $1 million. Shares purchased in exchange for
securities generally may not be redeemed or exchanged until the transfer has
settled -- usually within 15 days following the purchase by exchange.
The basis of the exchange will depend upon the relative net asset value
of the shares purchased and securities exchanged. Securities accepted by the
Fund will be valued in the same manner as the Fund values its assets. Any
interest earned on the securities following their delivery to the Transfer
Agent and prior to the exchange will be considered in valuing the
securities. All interest, dividends, subscription or other rights attached
to the securities become the property of the Fund, along with the securities.
EXCHANGE PRIVILEGE. Subject to the Fund's minimum investment
requirement, investors may exchange their Fund shares without charge for
shares of any other investment portfolio offered by Investment Company.
Shares are exchanged on the basis of relative net asset value per share.
Exchanges may be made: (1) by telephone if the registrations of the two
accounts are identical; or (2) in writing addressed to State Street Bank and
Trust Company, P.O. Box 8317, Boston, MA 02107, Attention: The Seven Seas
Series Short Term Government Securities Fund. If shares of the Fund were
purchased by check, the shares must have been present in an account for 10
days before an exchange is made. The exchange privilege will only be
available in states where the exchange may legally be made, and may be
modified or terminated by the Fund upon 60 days' notice to shareholders.
REDEMPTION OF FUND SHARES
Fund shares may be redeemed on any business day at the net asset value
next determined after the receipt of a redemption request in proper form as
described below. Payment will ordinarily be made in seven days and will be
mailed to the shareholder's address of record. Upon request, redemption
proceeds will be wire transferred to the shareholder's account at a domestic
commercial bank that is a member of the Federal Reserve System. Although
Investment Company does not currently charge a fee for this service,
Investment Company reserves the right to charge a fee for the cost of
wire-transferred redemptions of less than $1,000. Payment for redemption of
shares purchased by check may be withheld for up to 10 days after the date of
purchase to assure that such checks are honored. A dividend will be paid on
shares redeemed if the redemption request is received by State Street Bank
and Trust Company after 12:00 noon
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Eastern time. Redemption requests received before 12:00 noon Eastern time
will not be entitled to that day's dividend.
EXPEDITED REDEMPTION. Shareholders may normally redeem Fund shares by
telephoning State Street Bank and Trust Company between 9:00 a.m. and 4:00
p.m. Eastern time at (800) 647-7327, Attention: The Seven Seas Series Short
Term Government Securities Fund. Shareholders using the expedited
redemption method must complete the appropriate section on the Application.
During periods of drastic economic or market changes, shareholders using
this method may encounter delays. In such event, shareholders should
consider using the mail redemption procedure described below.
MAIL. Redemption requests may be made in writing directly to State
Street Bank and Trust Company, P.O. Box 8317, Boston, MA 02107, Attention:
The Seven Seas Series Short Term Government Securities Fund. The redemption
price will be the net asset value next determined after receipt by State
Street of all required documents in good order. "Good order" means that the
request must include the following:
1. A letter of instruction or a stock assignment stating
that the shares are to be redeemed out of The Seven
Seas Series Short Term Government Securities Fund and
designating specifically the dollar amount to be
redeemed signed by all owners of the shares in the
exact names in which they appear on the account,
together with a guarantee of the signature of each
owner by a bank, trust company or member of a
recognized stock exchange; and
2. Such other supporting legal documents, if required by
applicable law or Transfer Agent, in the case of
estates, trusts, guardianships, custodianships,
corporations and pension and profit-sharing plans.
The Fund reserves the right to redeem the shares in any account with a
balance of less than $500 as a result of shareholder redemptions. Before
shares are redeemed to close an account, the shareholder will be notified in
writing and allowed 60 days to purchase additional shares to meet the minimum
account balance.
The Fund may pay any portion of the redemption amount in excess of
$250,000 by a distribution in kind of readily marketable securities from the
portfolio of the Fund in lieu of cash. Investors will incur brokerage
charges on the sale of these portfolio securities. The Fund reserves the
right to suspend the right of redemption or postpone the date of payment if
emergency conditions, as specified in the 1940 Act or determined by the
Securities and Exchange Commission, should exist.
GENERAL MANAGEMENT
The Board of Trustees supervises the management, activities and affairs
of the Fund and has approved contracts with various financial organizations
to provide, among other services, day-to-day management required by the Fund.
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<PAGE>
ADVISORY AGREEMENT. Investment Company employs State Street Bank and
Trust Company ("State Street" or "Adviser") to furnish investment services to
the Fund. State Street is one of the largest providers of securities
processing and recordkeeping services for US mutual funds and pension funds.
State Street is a wholly owned subsidiary of State Street Boston Corporation,
a publicly held bank holding company. State Street, with over $144 billion
(US) under management as of September 30, 1994, provides complete global
investment management services from offices in the United States, London,
Sydney, Hong Kong, Tokyo, Toronto, Luxembourg, Melbourne, Montreal and Paris.
Adviser, subject to Board supervision, directs the investments of the
Fund in accordance with the Fund's investment objective, policies and
restrictions. The Fund investment decisions are made by committee and no
person is primarily responsible for making recommendations to that committee.
For these services, the Fund pays Adviser a fee, calculated daily and paid
monthly, that on an annual basis is equal to .50% of the Fund's average daily
net assets
The Glass-Steagall Act prohibits a depository state chartered bank such
as Adviser from engaging in the business of issuing, underwriting, selling
or distributing certain securities. The activities of Adviser in informing
its customers of the Fund, performing investment and redemption services and
providing custodian, transfer, shareholder servicing, dividend disbursing and
investment advisory services may raise issues under these provisions. Adviser
has been advised by its counsel that its activities in connection with the
Fund are consistent with its statutory and regulatory obligations. THE
SHARES OFFERED BY THIS PROSPECTUS ARE NOT ENDORSED OR GUARANTEED BY STATE
STREET OR ITS AFFILIATES, ARE NOT DEPOSITS OR OBLIGATIONS OF STATE STREET OR
ITS AFFILIATES, AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
Changes in federal or state statutes and regulations relating to the
permissible activities of banks and their affiliates, as well as judicial or
administrative decisions or interpretations of such or future statutes and
regulations, could prevent Adviser from continuing to perform all or a part
of the above services for its customers and/or the Fund. If Adviser were
prohibited from serving the Fund in any of its present capacities, the Board
of Trustees would seek an alternative provider(s) of such services. In such
event, changes in the operation of the Fund may occur. It is not expected by
Adviser that existing shareholders would suffer any adverse financial
consequences (if another adviser with equivalent abilities is found) as a
result of any of these occurrences.
State Street may from time to time have discretionary authority over
accounts which invest in Investment Company shares. These accounts include
accounts maintained for securities lending clients and accounts which
permit the use of Investment Company portfolios as short-term cash sweep
investments. Shares purchased for all discretionary accounts are held of
record by State Street, who retains voting control of them. As of November 9,
1994, State Street held of record 38% of the issued and outstanding shares of
Investment Company in connection with its discretionary accounts.
Consequently, State Street may be deemed to be a controlling person of
Investment Company for purposes of the 1940 Act.
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<PAGE>
ADMINISTRATION AGREEMENT. Frank Russell Investment Management Company
("Administrator") serves as administrator of the Fund. Administrator
currently serves as investment manager and administrator to 22 mutual funds
with assets of $6.2 billion as of October 31, 1994, and acts as administrator
to 17 mutual funds, including these Fund presented in this Prospectus, with
assets of $6.1 billion as of October 31, 1994.
Pursuant to the Administration Agreement with Investment Company,
Administrator will: (1) supervise all aspects of the Fund's operations; (2)
provide the Fund with administrative and clerical services, including the
maintenance of certain of the Fund's books and records; (3) arrange the
periodic updating of the Fund's prospectuses and any supplements thereto; (4)
provide proxy materials and reports to Fund shareholders and the Securities
and Exchange Commission; and (5) provide the Fund with adequate office space
and all necessary office equipment and services, including telephone service,
heat, utilities, stationery supplies and similar items. For these services,
the Government Securities Fund and Investment Company's other domestic
investment portfolios pay Administrator a combined fee that on an annual
basis is equal to the following percentages of their average aggregate daily
net assets: (1) $0 up to $500 million -- .06%; (2) over $500 million to $1
billion --.05%; and (3) over $1 billion -- .03%. The percentage of the fee
paid by the Fund is equal to the percentage of average aggregate daily net
assets that are attributable to the Fund. Administrator will also receive
reimbursement of expenses it incurs in connection with establishing new
investment portfolios. The fee paid to the Administrator will be less than an
amount equal to the sum of certain distribution expenses incurred by the
Fund's distributor on behalf of the Fund, up to a maximum of 15% of the
amount as determined in the fee calculation above.
Administrator also provides administrative services in connection with
the registration of shares of Investment Company with those states in which
its shares are offered or sold. Compensation for such services is on a "time
spent" basis. Investment Company will pay all registration, exemptive
application, renewal and related fees and reasonable out-of-pocket expenses.
DISTRIBUTION SERVICES AND SHAREHOLDER SERVICING ARRANGEMENTS. Pursuant
to the Distribution Agreement with Investment Company, Russell Fund
Distributors, Inc. ("Distributor"), a wholly owned subsidiary of
Administrator, serves as distributor for all Fund shares.
The Fund has adopted a distribution plan pursuant to Rule 12b-1 (the
"Plan") under the 1940 Act. The purpose of the Plan is to provide for the
payment of certain Investment Company distribution and shareholder servicing
expenses. Under the Plan, Distributor will be reimbursed in an amount up to
.25% of the Fund's average annual net assets for distribution-related and
shareholder servicing expenses. Payments under the Plan will be made to
Distributor to finance activity that is intended to result in the sale and
retention of Fund shares including: (1) the costs of prospectuses, reports to
shareholders and sales literature; (2) advertising; and (3) expenses incurred
in connection with the promotion and sale of Fund shares, including
Distributor's
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overhead expenses for rent, office supplies, equipment, travel,
communication, compensation and benefits of sales personnel.
Under the Plan, the Fund may also enter into agreements ("Service
Agreements") with financial institutions, which may include Adviser ("Service
Organizations"), to provide shareholder servicing with respect to Fund shares
held by or for the customers of the Service Organizations. Under the Service
Agreements, the Service Organizations may provide various services for
such customers including: answering inquiries regarding the Fund; assisting
customers in changing dividend options, account designations and
addresses; performing subaccounting for such customers; establishing and
maintaining customer accounts and records; processing purchase and redemption
transactions; providing periodic statements showing customers' account
balances and integrating such statements with those of other transactions and
balances in the customers' other accounts serviced by the Service
Organizations; arranging for bank wires transferring customers' funds; and
such other services as the customers may request in connection with the Fund,
to the extent permitted by applicable statute, rule or regulation. Service
Organizations may receive from the Fund, for shareholder servicing, a
monthly fee at a rate that shall not exceed .20% per annum of the average
daily net asset value of the Fund's shares owned by or for shareholders with
whom the Service Organization has a servicing relationship. Banks and other
financial service firms may be subject to various state laws, and may be
required to register as dealers pursuant to state law.
Investment Company has entered into Service Agreements with Adviser and
with Adviser's State Street Solutions area to obtain the services described
above with respect to Fund shares held by or for customers. In return for
these services, Investment Company pays Adviser a fee in an amount that per
annum is equal to .025% of the average daily value of all Fund shares held by
or for customers, and .175% of the average daily value of all Fund shares
held by or for customers of Adviser's State Street Solutions area.
Payments to Distributor, as well as payments to Service Organizations
from the Fund, are not permitted by the Plan to exceed .25% of the Fund's
average net asset value per year. Any payments that are required to be made
by the Distribution Agreement and any Service Agreement but could not be made
because of the .25% limitation may be carried forward and paid in subsequent
years so long as the Plan is in effect. The Fund's liability for any such
expenses carried forward shall terminate at the end of two years following
the year in which the expenditure was incurred. Service Organizations will
be responsible for prompt transmission of purchase and redemption orders and
may charge fees for their services.
FUND EXPENSES
The Fund will pay all of its expenses other than those expressly assumed
by Adviser and Administrator. The principal expenses of the Fund are the
annual advisory fee payable to Adviser and distribution and shareholder
servicing expenses. Other expenses include: (1) amortization of
deferred organizational costs; (2) taxes, if any; (3) expenses for legal,
auditing and financial accounting services; (4) expense of preparing
(including typesetting, printing and mailing) reports, prospectuses and
notices to existing shareholders; (5) administrative fees; (6) expense of
issuing and redeeming Fund shares; (7) the cost of registering Fund shares
under federal and state laws;
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<PAGE>
(8) shareholder meetings and related proxy solicitation expenses; (9) the
fees, travel expenses and other out-of-pocket expenses of Trustees who are
not affiliated with Adviser or any of its affiliates; (10) insurance,
interest, brokerage and litigation costs; (11) extraordinary expenses as may
arise, including expenses incurred in connection with litigation proceedings
and claims and the legal obligations of Investment Company to indemnify its
Trustees, officers, employees, shareholders, distributors and agents; and
(12) other expenses properly payable by the Fund.
PERFORMANCE CALCULATIONS
The Government Securities Fund may from time to time advertise its
yield. Yield is calculated by dividing the net investment income per share
earned during the most recent 30-day (or one-month) period by the maximum
offering price per share on the last day of the month. This income is then
annualized. That is, the amount of income generated by the investment during
that 30-day period is assumed to be generated each month over a 12-month
period and is shown as a percentage of the investment. For purposes of the
yield calculation, interest income is computed based on the yield to maturity
of each debt obligation. The calculation includes all recurring fees that
are charged to all shareholder accounts.
From time to time the Fund may advertise its total return. The total
return of the Fund is the average annual compounded rate of return from a
hypothetical investment in the Fund over one-year, five-year and ten-year
periods or for the life of the Fund (as stated in the advertisement),
assuming the reinvestment of all dividend and capital gains distributions.
Comparative performance information may be used from time to time in
advertising or marketing Fund shares, including data from Lipper Analytical
Services, Inc., Donoghue's Money Fund Report, the Bank Rate Monitor, Wall
Street Journal Score Card, Lehman Brothers Index or other industry
publications, business periodicals, rating services and market indices. The
Fund may also advertise nonstandardized performance information which is for
periods in addition to those required to be presented.
Quoted yields, returns and other performance figures are based on
historical earnings and are not indications of future performance.
ADDITIONAL INFORMATION
CUSTODIAN, ACCOUNTANTS AND REPORTS. State Street holds all portfolio
securities and cash assets of the Fund, provides portfolio recordkeeping
services and serves as the Fund's transfer agent ("Transfer Agent") and
custodian ("Custodian"). State Street is authorized to deposit securities in
securities depositories or to use the services of subcustodians. State
Street has no responsibility for the supervision and management of the Fund
except as investment adviser. Coopers & Lybrand L.L.P., Boston,
Massachusetts, is Investment Company's independent accountants.
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REPORTS TO SHAREHOLDERS AND SHAREHOLDER INQUIRIES. Shareholders will
receive unaudited semiannual financial statements and annual financial
statements audited by Investment Company's independent accountants.
Shareholder inquiries regarding the Prospectus and financial statements may
be made by calling Distributor at (617) 654-6089. Inquiries regarding
shareholder balances may be made by calling Transfer Agent at (800) 647-7327.
ORGANIZATION, CAPITALIZATION AND VOTING. Investment Company was
organized as a Massachusetts business trust on October 3, 1987.
Investment Company issues shares divisible into an unlimited number of
series (or funds), each of which is a separate trust under Massachusetts law.
The Government Securities Fund is one such series.
Each Fund share represents an equal proportionate interest in the Fund,
has a par value of $.001 per share and is entitled to such relative rights
and preferences and dividends and distributions earned on assets of the Fund
as may be declared by the Board of Trustees. Fund shares are fully paid
and nonassessable by Investment Company and have no preemptive rights.
Each Fund share has one vote. There are no cumulative voting rights.
There is no annual meeting of shareholders, but special meetings may be held.
On any matter that affects only a particular investment portfolio, only
shareholders of that fund may vote unless otherwise required by the 1940 Act
or the Master Trust Agreement. The Trustees hold office for the life of the
Trust. A Trustee may resign or retire, and may be removed at any time by a
vote of two-thirds of Investment Company shares. The Trustees shall promptly
call and give notice of a meeting of shareholders for the purpose of voting
upon removal of any Trustee when requested to do so in writing by holders of
not less than 10% of the shares then outstanding. A vacancy on the Board of
Trustees may be filled by the vote of a majority of the remaining Trustees,
provided that immediately thereafter at least two-thirds of the Trustees have
been elected by shareholders.
Investment Company does not issue share certificates for the Fund.
Transfer Agent sends shareholders statements concurrent with any transaction
activity, confirming all investments in or redemptions from their accounts.
Each statement also sets forth the balance of shares held in the account.
As of November 10, 1994, 3NO6 Commonwealth Energy owned of record 44%
and 6C10 Fishnet and Company owned of record 31% of the issued and
outstanding shares of the Fund. Each is therefore deemed to be a controlling
person of the Fund for purposes of the 1940 Act.
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THE SEVEN SEAS SERIES FUND
Two International Place, 35th Floor
Boston, Massachusetts 02110
INVESTMENT ADVISER, CUSTODIAN AND TRANSFER AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
DISTRIBUTOR
Russell Fund Distributors, Inc.
Two International Place, 35th Floor
Boston, Massachusetts 02110
ADMINISTRATOR
Frank Russell Investment Management Company
909 A Street
Tacoma, Washington 98402
LEGAL COUNSEL
Goodwin, Procter & Hoar
Exchange Place
Boston, Massachusetts 02109
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
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