File # 33-20158
File # 811-5469
Form N-1A
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. 18
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 18
(Check appropriate box or boxes.)
WEXFORD TRUST
(Exact Name of Registrant as Specified in Charter)
12300 Perry Highway, WEXFORD, PA 15090-8318
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code 724-935-
5520 or 800-860-3863
Ronald H. Muhlenkamp, 12300 Perry Highway, Wexford, PA 15090-
8318
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b)
XXX on (8/1/98) 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 elected under Rule 24(f)2 to register an
indefinite number of shares under the Securities Act of 1933.
As of December 31, 1997 Registrant had issued a total of
3,432,778 shares for total consideration of $90,857,672.
Registrant has previously filed Notice of sale of shares in
accordance with Rule 24(f)-2.
A No-Load Fund
MUHLENKAMP FUND
Telephone Number (724) 935-5520 or (800) 860-3863
e-mail: [email protected]
Web Page: http://www.muhlenkamp.com
PROSPECTUS
August 1, 1998
MUHLENKAMP FUND ("The Fund"), A Series of the Wexford Trust (The
Registrant), is a diversified open-end mutual fund that
continuously offers its shares for sale to the public. The Fund
will manage its assets to seek to maximize total returns to its
shareholders, primarily by acquiring and holding a diversified
list of common stocks. The Fund may also acquire and hold fixed-
income or debt investments as market conditions warrant and
when, in the opinion of its advisor, it is deemed desirable or
necessary in order to attempt to achieve its investment
objective. (For further information, please refer to
"Investment Objectives and Policies" section herein).
This Prospectus is designed to provide you with concise
information which an investor should know about the Fund before
investing. You should retain this document for future
reference.
A Statement of Additional Information for the Fund, dated this
same date, has been filed with the Securities and Exchange
Commission and is incorporated herein by reference. A copy is
available without charge by writing or calling the Fund at the
address and telephone number listed on the cover of this
prospectus.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
TABLE OF CONTENTS PAGE
EXPENSE INFORMATION 2
CONDENSED FINANCIAL INFORMATION 3
CAPITAL OF TRUST 5
CUSTODIAN, AUDITOR AND DISTRIBUTOR 5
ADVISORY BOARD 6
INVESTMENT OBJECTIVES AND POLICIES 6
OPTIONS 7
RISK FACTORS 8
INVESTMENT ADVISOR 8
HOW TO BUY SHARES 9
AUTOMATIC INVESTMENT PLAN 10
HOW TO REDEEM SHARES 10
PORTFOLIO TRANSACTIONS 11
BROKER ALLOCATIONS 11
FEDERAL INCOME TAX STATUS 11
IRA AND RETIREMENT ACCOUNTS 11
APPLICATION BLANK INSERT
Custodian: Investment Advisor: Transfer Agent
Star Bank Muhlenkamp & Co., Inc. American Data Services,
425 Walnut 12300 Perry Highway, Inc.
Street Suite 306 150 Motor Pkwy., Suite
Cincinnati, OH Wexford, PA 15090-8318 109
45201-1118 Tel: (724) 935-5520 or Hauppauge, NY 11788
(800) 860-3863 Tel: (516) 385-9580
e-mail: Fax: (516) 385-7909
[email protected]
EXPENSE INFORMATION
The following information is designed to help you compare the
fees and expenses charged by the Fund with those of other mutual
funds. As you know, the Fund is a "NO LOAD" fund, which means
that you pay no sales commissions to buy shares. In addition,
the Fund makes no charge when you sell shares, nor has any other
deferred, hidden or other charges. As a result, all of your
money goes to work for you, as follows:
1. Shareholder Transaction
Expenses:
Sales Commissions to Purchase None
Shares
Commissions to Reinvest None
Dividends
Redemption Fees None
2. Annual Fund Operating
Expenses (Expenses paid out by
the Fund before it distributed
its net investment income, as a
percentage of its average net
assets for the calendar year
ended December 31, 1997):
Investment Advisor's Fee 1.00%
12b-1 Fees None
Other Net Operating Expenses 0.28%
Commission Credits used to Pay -0.01%
Expenses* *
Total Fund Expenses 1.27%
There are certain charges associated with
retirement accounts offered by the fund. (See
"IRA and Retirement Accounts")
Investors may be charged a fee by their broker
if they effect transactions through a broker
or agent.
Example:
If you bought shares of the Fund on January 1, for which you
paid $1,000, and if we assume a 5% annual return, and that all
shares were redeemed December 31st, you would pay the
following expenses for:
1 year 3 years 5 years 10 years
$13 $39 $67 $148
This expense information is designed to help you understand the
various costs and expenses customarily charged by mutual funds.
The example, however, should not be considered as representative
of future expenses or returns of the Fund. Actual expenses and
returns vary from year to year and may be higher or lower than
those shown. Also, the agreement with the investment advisor
places certain limits on expenses, which can be charged to the
Fund. See Investment Advisor Section, pages 7 & 8.
* * The Fund has a directed business arrangement with Capital
Institution Services, Inc. (CIS). Upon the purchase and/or
sale of investment securities, the Fund pays a brokerage
commission to CIS. The Fund has found CIS commission rates to
be less than those available from other providers. Wexford
Trust and the Fund have no other relationship with CIS. The
commissions paid to CIS generate non-refundable cumulative
credits, which are available to pay certain expenses of the
Fund.
CONDENSED FINANCIAL INFORMATION
The following table shows certain financial information, which
depicts the Fund's yearly results. The selected per share data
and ratio table is derived from the Fund's financial statements,
which have been audited by Deloitte & Touche LLP, independent
auditors. The audited financial statements may be found in the
Fund's most recent annual report which may be obtained, without
charge, by writing or calling the Fund at the number listed on
the cover of this prospectus.
FINANCIAL HIGHLIGHTS
Selected per share data and ratios for each share outstanding
throughout each period. Each year ends December 31st.
THE WEXFORD TRUST
(COMPRISED OF THE MUHLENKAMP FUND)
SELECTED PER SHARE DATA AND RATIOS
FOR THE YEARS ENDED DECEMBER 31, 1989 THROUGH DECEMBER 31,
1997 AND THE SIX MONTH PERIOD ENDING JUNE 30, 1998.
Six 1997 1996 1995 1994
Months
Ended
June 30,
1998
NET ASSET VALUE, 36.55 $27.52 $21.26 $16.23 $17.86
BEGINNING OF YEAR
Income from
Investment Operations:
Net investment .04 0.18 0.14 0.21 0.11
income (1)
Net gains or 6.00 8.98 6.23 5.14 (1.39)
(losses) on securities
Total From 6.04 9.16 6.37 5.35 (1.28)
Investment Operations
Less Distributions:
Dividends (from - (0.13) (0.11) (0.21) (0.10)
investment income)
Distributions (from - - - (0.11) (0.25)
capital gains)
Return of capital - - - - -
Total - (0.13) (0.11) (0.32) (0.35)
Distributions
NET ASSET VALUE, END OF 42.59 $36.55 $27.52 $21.26 $16.23
YEAR
Total Return (2) (3) 16.53% 33.28% 29.90% 32.9% (7.20)%
Net Assets, End of 207,283 $125,460 $42,038 $23,571 $16,610
Period (000's omitted)
Ratio of Total Expenses 1.30% 1.44% 1.56% 1.4% 1.57%
to Average Net Assets
(2)
Ratio of Net Expenses 1.28% 1.33% 1.54% 1.35% 1.52%
to Average Net Assets
(2)
Ratio of Net Investment 0.52% 0.53% 0.58% 1.10% 0.70%
Income to Average Net
Assets (3)
Portfolio Turnover Rate 13.85% 13.89% 16.90% 22.70% 25.60%
(3)
Average Commission Rate 0.0465 0.0205 0.0382 .0442 .0471
Paid (dollar per share)
(1) Computed on weighted average number of shares
outstanding during the year.
(2) During the years ended December 31, 1992 through the
six month period ending June 30, 1998, the Fund utilized
the commission credits of $4,240, $5,950, $8,830, $11,000,
$5,000 and $47,425, 13,300 respectively, to pay certain
expenses of the Fund. The Total return for the Fund would
have been 15.6%, 18.0%, (7.2%), 32.9%, 29.9%, and 33.2%,
16.53% for the years ended December 31, 1992 through 1997
and the six month period ending June 30, 1998,
respectively, without the credits.
(3) Annualized except Total Return. If Total return were
annualized the rate would be 36.13%
See notes to financial statements.
THE WEXFORD TRUST
(COMPRISED OF THE MUHLENKAMP FUND)
SELECTED PER SHARE DATA AND RATIOS
FOR THE YEARS ENDED DECEMBER 31, 1989 THROUGH 1997
1993 1992 1991 1990 1989
NET ASSET VALUE, $15.20 $13.25 9.21 $11.05 $10.04
BEGINNING OF YEAR
Income from
Investment Operations:
Net investment 0.12 0.20 .13 0.19 .39
income (1)
Net gains or 2.63 1.89 4.05 (1.83) 0.86
(losses) on securities
Total From 2.75 2.09 4.18 (1.64) 1.25
Investment Operations
Less Distributions:
Dividends (from (0.08) (0.14) (.11) (0.19) (0.25)
investment income)
Distributions (from - - - - -
capital gains)
Return of capital (0.01) - (.03) - -
Total (0.09) (0.14) (.14) (0.19) (0.25)
Distributions
NET ASSET VALUE, END OF $17.86 $15.20 $13.25 $9.21 $11.04
YEAR
Total Return 18.10% 15.80% 45.40% (14.80%) 12.50%
Net Assets, End of $12,05 $1,962 $1,183 $1,104
Period (000's omitted) 7 $4,716
Ratio of Total Expenses 1.30% 1.41% 1.71% 1.76% 1.54%
to Average Net Assets
Ratio of Net Expenses 1.23% 1.28% - - -
to Average Net Assets
Ratio of Net Investment 0.70% 1.44% 1.17% 1.95% 3.04%
Income to Average Net
Assets
Portfolio Turnover Rate 14.10% 20.10% 52.50% 47.47% 34.46%
Average Commission Rate .0586 .0704 .1304 .0163 .0834
Paid (dollar per share)
(1) Computed on weighted average number of shares
outstanding during the year.
(2) During the years ended December 31, 1992 through (3)
1997, the Fund utilized commission credits of $4,240,
$5,950, $8,830, $11,000, $5,000 and $47,425,
respectively, to pay certain expenses of the Fund. The
total return for the Fund would have been 15.6%, 18.0%,
(7.2)%, 32.9%, 29.9%, and 33.2% for the years ended
December 31, 1992 through 1997, respectively, without
the credits.
See notes to financial statements.
The Fund, which was organized as a Massachusetts Business trust
on September 21, 1987, had no financial history prior to that
date. The Fund will mail a semi-annual report to shareholders
maintaining an active account on June 30th of the current fiscal
year. Annual reports will be mailed to shareholders maintaining
an active account on December 31st of the current fiscal year.
However, the Fund will not mail duplicate financial reports and
prospectuses to shareholders having the same address of record.
Shareholders can obtain additional copies of the financial
reports and prospectus by calling or writing the Fund at the
address on the cover of this Prospectus.
CAPITAL OF TRUST
Fund capital consists of an unlimited number of shares of
beneficial interest having a par value of $.001 each. When
issued, each share or fraction thereof is fully paid, non-
assessable, transferable and redeemable. All shares are of the
same class, and each full share has one vote. The Fund is one
of a series of funds registered as a Massachusetts Business
Trust. As part of a trust, each fund has its own Board of
Trustees which supervise fund activities and review contractual
arrangements. Fractional shares are issued to three decimal
places, but do not carry voting rights. As a trust, there is no
requirement to hold annual shareholder meetings. However, it is
intended that special meetings, which may be called upon the
request of the owners of 10% of shares outstanding, will be held
as needed or required when and as duly called. Approval of a
majority of the shares outstanding must first be obtained
before changing fundamental policies, to amend the contract with
its investment advisor, to terminate the Fund, or to change any
other items on which shareholders are granted such rights by law
or under provisions of its Declaration of Trust. A majority of
Trustees must have been voted into office by shareholders even
though Trustees may fill vacancies without a shareholder vote so
long as such appointments do not produce a majority of Trustees
holding office. The Fund offers its own shares exclusively.
All shareholder inquiries should be directed to the Muhlenkamp
Fund at the address and telephone number listed on the cover of
this Prospectus.
CUSTODIAN, AUDITOR, DISTRIBUTOR AND TRANSFER AGENT
Custodian: Star Bank, 425 Walnut Street, Cincinnati, OH 45201-
1118, (513) 632-4603, has been appointed and serves as custodian
of the assets of the Fund. As custodian it is empowered under
agreement as agent for the Fund to hold all its assets,
securities and cash in the name of the bank or in the bank's
nominee name or names, and to accept instructions for the
purchase, sale or reinvestment of the Fund's assets from the
president of the Fund or from its investment advisor.
Auditor: Deloitte & Touche LLP, 2500 One PPG Place, Pittsburgh,
PA 15222-5401 (412)338-7200 has been appointed as the
independent certified public accountant and auditor for the
Fund. Neither the firm nor any of its principals or staff holds
any financial interest directly or indirectly in the Fund.
Distributor: Wexford Trust, P.O. Box 598 Wexford, PA 15090-8318,
Tel: (724) 935-5520 or (800) 860-3863, acts as the sole
distributor of Fund shares issued. As of the date of this
Prospectus, Muhlenkamp Fund was the only fund of the Wexford
Trust series registered and in existence.
Transfer Agent: American Data Services, Inc., 150 Motor Pkwy,
Suite 109, Hauppauge, NY 11788, is the transfer agent for the
Fund.
THE TRUST
The Wexford Trust is a Massachusetts Business Trust managed by
its trustees under the laws of the Commonwealth of
Massachusetts. The Wexford Trust was formed on July 6, 1988.
ADVISORY BOARD
Under the terms of Article XI of the Trust's Bylaws, the
President of the Fund, with the approval of the Board of
Trustees, may appoint up to 15 individuals to assist the
President and the Trustees to define and set overall investment
strategies in an attempt to reach the Fund's investment
objectives as stated. The Trust currently has no advisory
board.
INVESTMENT OBJECTIVE AND POLICIES
The investment objective of the Fund is to seek to maximize the
total return to its shareholders through a combination of income
from dividends and interest and from capital appreciation,
consistent with reasonable risk. This objective cannot be
changed without a vote of the shareholders. The Fund's
investments will normally consist of a diversified list of
common stocks. The Fund may also invest in fixed-income or debt
securities from time to time as stock substitutes when market
conditions, in the opinion of the investment advisor, warrant
such a move. Such a market condition occurred in the early
1980's when corporate interest rates exceeded corporate returns
on equity. Such conditions are unusual; therefore, the Fund
has no expectation of investing in fixed income or debt
investments on a regular or routine basis in significant
amounts. Consistent with the Fund's objective of seeking to
maximize total returns for Fund shareholders, the Fund from
time to time may choose to invest some or all of the Fund's
assets in fixed-income or debt investments, even when not using
them as stock substitutes. Fixed income or debt securities will
customarily be in U.S. Treasuries and Government Agency
securities as well as corporate fixed income or debt securities
rated A or better by one or more of the major rating services.
The Fund may on occasion invest in below A rated fixed income or
debt securities, but it will not exceed 5% of the portfolio.
Securities rated Baa-BBB have some speculative grade
characteristics and securities rated below BBB are primarily
speculative. (Please refer to the Statement of Additional
Information, available upon request, for bond rating categories
as defined by Standard & Poors.) Fixed income securities have a
set rate of interest on the face value of the instrument and not
necessarily on the market value. Fixed income securities also
include zero coupon bonds. Zero coupon bonds have no coupon and
receive their return from the accretion in value during the
lifetime of the bond. Because there is no coupon, a zero coupon
bond tends to be 2-3 times more volatile relative to coupon
bonds having otherwise similar characteristics.
The advisor's decision making criteria for owning equity
securities uses a combination of corporate returns on equity and
price-to-book value ratios. The advisor seeks equity securities
in which the above criteria indicate to the advisor that
available returns may exceed the current inflation rate (as
measured by the CPI Index) by 4%. Fixed-income or debt
securities may be owned when the yield to maturity exceeds the
current inflation rate by at least 2% and is competitive with
common stock returns as herein defined. Common stocks acquired
will principally be of companies whose securities are listed on
the major securities exchanges, although the Fund may also
purchase selected companies that are traded in the over-the-
counter market.
The investment advisor to the Fund does not subscribe to the
philosophy that securities can be acquired and held forever, but
instead believes that securities markets, as well as industries
and companies, can be cyclical in nature as a result of inherent
industry, corporate, or even international factors, such as
technological, economic, monetary, social or political forces,
either alone or in combination with one another. The life span
of such cycles will vary and may be long or short-term. For
these reasons, the advisor places emphasis on a business-like
evaluation of current conditions and studies market history to
get a better understanding of security values under different
conditions, but does not try to apply historical evaluation
methods directly to today's markets. While short-term swings in
the marketplace are not ignored, they are subordinated by the
Fund's advisor to the quest for long-term values.
Diversification is believed by the advisor to be a key
investment factor. The advisor recognizes that the proportion
of classes of securities to be held at any given time may vary,
depending upon economic and market conditions then existing.
The relationship of money instruments, bonds and stocks in the
Fund's portfolio will change as the advisor perceives these
conditions.
Basic investment goals the investment advisor shall bear in mind
as it seeks to maximize the Fund's total return to shareholders
are: (1) to preserve capital; and (2) to achieve its
return expectations without subjecting the portfolio to
unacceptable business or market risks.
It is the opinion of the advisor that maximum total returns are
achievable when common stocks can be purchased at a discount
from their true business worth. Specifically, the Fund will
seek to invest its assets in companies that may have some or all
of the following characteristics compared to the companies
comprising a major market index like the Standard & Poor's 500:
(a) low price-to-earnings multiples based upon current
and/or potential future estimated earnings of the company; (b)
high total returns on equity capital; and (c) a market price
per share that the advisor deems attractive relative to its
per share book value -- an accounting measure of economic
worth. Although the objective is to select stocks with these
characteristics, the advisor is aware that it is unrealistic to
assume that each selection will have all of the above
characteristics.
If the advisor is unable to locate investments for the Fund that
meet such criteria within then-existing market or economic
conditions, the Fund will adopt a temporary defensive position
where it is intended that some or all of Fund assets will be
"parked" in high grade money market instruments, such as bank
certificates, U.S. Treasury Securities, or other similar types
of short-term debt obligations.
When maintaining a cash position the Fund plans to utilize
computerized cash management services offered by its custodian,
which services presently include reinvesting overnight and short
term cash balances in shares of other registered investment
companies, better known as "money market funds". The Fund will
not be acquiring such shares as permanent investments but
rather will be utilizing such services solely for convenience
and efficiency as it tries to keep short term moneys invested at
interest only until such time as more permanent reinvestments
can practically be made in the ordinary course of business.
Cash will be held pending the purchase, sale or reinvestment of
the Fund's assets.
While it is the intention of the Fund to seek to achieve an
objective of maximum total return to shareholders, there can be
no assurance to an investor that it will be able to do so. An
important element of this investment approach requires that
movement of monies from one kind of investment to another be
correctly timed by the advisor, which will not always be
possible. Investors in the Fund should be aware that incorrect
allocation of Fund assets between equity and fixed-income or
debt securities could result in the Fund having a substantial
portion of its assets in equity securities when prices are
decreasing or a substantial portion in fixed-income or debt
securities when prices of equity securities are increasing.
Investors should also be aware of the risks inherent when
investing in common stocks, which risks include the senior right
of lenders ahead of claims of common shareholders upon
liquidation of the issuing company, as well as the risk that
dividends may not be earned, declared or paid by directors,
which may in turn cause significant fluctuations in share market
prices.
The Fund retains the right to diversify its investment portfolio
by investing and reinvesting assets from time to time only in
issues as necessary to be in conformity with the Investment
Company Act of 1940, and to retain the Fund's qualification
under Subchapter M of the Internal Revenue Code. (Please refer
to Federal Income Tax section of this Prospectus for further
details.)
The Fund may not lend its assets to any person or individual.
The Fund may not invest in warrants in excess of 5% of the
Fund's Net Assets.
No more than 2% of the Fund's net assets may be invested in
warrants not listed on the NY or American Stock Exchanges.
Under normal market conditions the Fund may not hold more than
15% of net assets in illiquid securities.
Panic or program selling, such as occurred in October 1987 are
viewed as abnormal market conditions.
Additional restrictions the Fund has imposed upon itself are
contained in its Statement of Additional Information, which is
on file with the Securities and Exchange Commission and
available to shareholders upon request and without cost from
Wexford Trust by telephoning or writing the Trust or the Fund at
the phone number/address shown on the cover of this Prospectus.
OPTIONS
The Fund may purchase and write (i.e., sell) put and call
options on any security in which it may invest or options on any
securities index. These options are traded on U.S. exchanges or
in the over-the-counter market to hedge its portfolio and to
enhance the Funds return. The fund may write covered put and
call options to generate additional income through the receipt
of premiums and purchase call options in an effort to protect
against an increase in the price of securities it intends to
purchase. The Fund may also purchase put and call options to
offset previously written put and call options of the same
series.
A call option gives the purchaser, in exchange for a premium
paid, the right for a specified period of time to purchase the
securities or securities in the index subject to the option at a
specified price (the exercise or strike price). The writer of a
call option, in return for the premium, has the obligation, upon
exercise of the option, to deliver, depending upon the terms of
the option contract, the underlying securities or a specified
amount of cash to the purchaser upon receipt of the exercise
price. When the Fund writes a call option, it gives up the
potential for gain on the underlying securities or in excess of
the price of the option during the period that the option is
open.
A put option gives the purchaser, in return for a premium, the
right, for a specified period of time, to sell the securities
subject to the option to the writer of the put at the specified
exercise price. The writer of the put option, in return for the
premium, has the obligation, upon exercise of the option, to
acquire the securities underlying the option at the exercise
price. The Fund might, therefore, be obligated to purchase the
underlying securities for more than their current market price.
The Fund will write only "covered" options. A written option is
covered if, as long as the Fund is obligated under the option,
it (i) owns an offsetting position in the underlying security or
(ii) maintains in a segregated account, cash or other liquid
assets in an amount equal to or greater than its obligation
under the option. Under the first circumstance, the Fund's
losses are limited because it owns the underlying security;
under the second circumstance, in the case of a written call
option, the Fund's losses are potentially unlimited. There is
no limitation on the amount of call options the Fund may write.
The Fund may also write a call option, which can serve as a
limited short hedge because decreases in value of the hedge
investment would be offset to the extent of the premium received
for writing the option. However, if the security appreciates to
a price higher than the exercise price of the call option, it
can be expected that the call will be exercised and the Fund
will be obligated to sell the security at less than its market
value.
The Fund may purchase and sell put and call options on
securities indices. Securities index options are designed to
reflect price fluctuations in a group of securities or segment
of the securities market rather than price fluctuations in a
single security. Options on securities indices are similar to
options on securities, except that the exercise of securities
index options requires cash payments and does not involve the
actual purchase or sale of securities. When purchasing or
selling securities index options, the Fund is subject to the
risk that the value of its portfolio securities may not change
as much as or more than the index because the Fund's investments
generally will not match the composition of the index.
At this time the Fund does not intend to invest (i.e., purchase
& sell call and put options) more than 5% of its net assets in
options.
Risks of Hedging and Return Enhancement Strategies
Participating in the options markets involves investment risks
and transaction costs to which the Fund would not be subject
absent the use of these strategies. The Fund, and thus its
investors, may lose money through any unsuccessful use of these
strategies. Risks inherent to the use of options include (1)
imperfect correlation between the price of the option and
movement in the price of the securities being hedged; (2) the
fact that skills needed to use these strategies are different
from those needed to select portfolio securities; (3) the
possible absence of a liquid secondary market for any particular
instrument at any time; (4) the possible need to defer closing
out certain hedged positions to avoid adverse tax consequences;
and (5) the possible inability of the Fund to purchase or sell a
portfolio security at a time that otherwise would be favorable
for it to do so, or the possible need for the Fund to sell a
portfolio security at a disadvantageous time, due to the need
for the Fund to maintain "cover" or to segregate securities in
connection with hedging transactions.
The Fund will generally purchase options on an exchange only if
it appears to be a liquid secondary market for such options or
futures; the Fund will generally purchase OTC options only if
the investment advisor believes that the other party to options
will continue to make a market for such options. However, there
can be no assurance that a liquid secondary market will continue
to exist or that the other party will continue to make a market.
Thus, it may not be possible to close an option transaction.
The inability to close option positions also could have an
adverse impact on the Fund's ability to effectively hedge its
portfolio. There is also the risk of loss by the Fund of margin
deposits or collateral in the event of bankruptcy of a broker
with whom the Fund has an open position in an option.
RISK FACTORS
The investment objective of the Fund is to seek to maximize the
total return to its shareholders through a combination of income
from dividends and interest and from capital appreciation,
consistent with reasonable risk. The focus is long-term. The
classes of investment vehicles permitted are fairly broad;
including stocks, bonds, cash equivalents and other investment
companies. The purpose of the breadth is to allow flexibility
in managing the assets, but this flexibility also entails the
risk that assets will be invested in various classes of
securities at the wrong time and prices. This risk is in
addition to the risks inherent in each class of securities and
is in addition to the short-term price risks (volatility) which
often accompany a long-term approach to investing. The value of
fixed-income or debt securities generally varies inversely with
interest rates.
INVESTMENT ADVISOR
The Fund retains Muhlenkamp & Co., Inc. a Pennsylvania
corporation principally owned by Ronald H. Muhlenkamp, as
investment advisor under an annual contract. Muhlenkamp & Co.,
located at 12300 Perry Hwy, Wexford, Pennsylvania, 15090, and
the Fund share facilities, space and staff with each other.
The advisor is registered with the Securities and Exchange
Commission under the Investment Advisors Act of 1940, and with
the Pennsylvania Securities Commission, Harrisburg,
Pennsylvania. Accordingly, the advisor files periodic reports
with both agencies, which are available for public inspection.
Although Ronald H. Muhlenkamp had prior experience as an
analyst with Integon Corporation, an insurance holding company
that managed assets for a regulated investment company,
Muhlenkamp & Co., has not previously advised a managed
investment company. Mr. Ronald H. Muhlenkamp is the principal
officer and investment professional at Muhlenkamp & Co., Inc.
and the Fund. The advisor receives a fee from the Fund equal to
1% per annum of the average daily market value of its net
assets.
Under terms of the advisory agreement, total Fund expenses
cannot under any circumstances exceed 2% of the Fund's net
assets. Should actual expenses incurred ever exceed the 2%
limitation, such excess expenses shall be paid by the advisor.
Should the net assets of the Fund exceed $100 Million, total
Fund expenses shall be limited to 1.5% of the assets over $100
Million. Any excess expenses shall be paid by the advisor.
The investment management history of Muhlenkamp & Co.,Inc. and
its principal, Ronald H. Muhlenkamp, includes serving as
portfolio manager and/or investment advisor to corporations,
individuals, pension and profit-sharing plans and endowment
funds. Mr. Muhlenkamp has been active without interruption
since 1970 in the field of investment research and/or portfolio
management, both privately and as an officer in charge of
management of corporate monies. As of the date of this
Prospectus, Muhlenkamp & Co., Inc. is under contract to provide
investment management and advice to individual and institutional
clients, in addition to the Fund.
Mr. Muhlenkamp holds an engineering degree from Massachusetts
Institute of Technology, an MBA from Harvard Business School and
he has earned the Financial Analyst Federation's designation as
a "Chartered Financial Analyst".
HOW TO BUY SHARES
Investors may begin an investment in Fund shares with as little
as US $200 (no minimum for an IRA), by simply completing and
signing the enclosed application form. All accounts must have a
valid tax identification number. Return the form to Muhlenkamp
Fund, C/O American Data Services, P.O. Box 5786, Hauppauge, NY
11788, or (via overnight mail courier): American Data Services,
Inc. 150 Motor Pkwy. Hauppauge NY 11788, along with a check made
payable to the "MUHLENKAMP FUND". Certified checks are not
necessary. All purchases will be made WITHOUT ANY SALE CHARGES
on the business day your properly completed application and
check are in the Fund's possession. Purchase of shares for your
account on the day of acceptance will be made at the Net Asset
Value ("NAV") per share calculated as of that same day. The NAV
is calculated for each day as of the close of business on the
New York Stock Exchange (now 4:00 p.m.) and on such other days
as there is sufficient trading in the Fund's portfolio of
securities to materially affect its NAV per share.
Securities in the Fund's portfolio will ordinarily be valued
based upon market quotes. If quotations are not available,
securities or other assets will be valued by a method, which the
Trustees believe most accurately reflects fair value. The NAV
per share is determined at each calculation by dividing the
total market value of all assets, cash and securities held, less
liabilities, if any, by the total number of shares outstanding
that day. The Fund reserves the right to reject purchase
applications or to terminate the offering of shares made by this
Prospectus if in the opinion of the Board of Trustees such
termination and/or rejection would be in the best interest of
the shareholders. In the event your check does not clear, your
order(s) will be canceled and you may be liable for losses or
fees incurred, or both. For all subsequent purchases after an
initial investment in Fund shares, a minimum purchase of US$100
is required, except for IRA accounts, for which no limit is
applied. Purchases may be made by mail to: Muhlenkamp Fund,
P.O. Box 799, Cincinnati, Ohio, 45264-0799, or (via overnight
mail courier): Star Bank, 425 Walnut Street, Cincinnati OH,
45201-1118. No telephone purchases are permitted at this time.
In order to accommodate IRA investments and IRA rollovers, which
are often odd amounts, the Fund offers to all IRA participants
the right to invest or rollover such IRA monies in Fund shares
in any amount that is eligible or allowed under current Internal
Revenue Service rules, without regard to any minimum that is
imposed on non-IRA accounts.
All shares purchased will be held in an account that is opened
and maintained by the Fund for each shareholder and no share
certificates will be issued by the Fund. All shareholders, by
law, are entitled to ask to have share certificates issued. Due
to the inconvenience, costs, and additional work involved with
issuing certificates, shareholders are being strongly encouraged
to have all shares held in an account maintained by the Fund
itself, as has become the custom within the mutual fund
industry. Should the Fund be required to issue certificates, it
intends to request that the requesting shareholder, if possible,
redeem all shares of the Fund and close the account rather than
issue certificates. The issuing of certificates has become
impractical, uneconomic and difficult to maintain when all Fund
activities are electronically processed.
Each shareholder account will be credited with and will hold all
shares purchased and issued, including shares issued on payment
date as a result of the automatic reinvestment of dividends
and/or capital gain distributions. Shareholders may request
dividends and distributions be paid in cash in lieu of shares
simply by making a request in writing, addressed to the Fund at
its current address.
Those investors desiring distributions in cash rather than in
additional shares should make such request in writing, which
request the Fund must reasonably be able to authenticate to the
complete satisfaction of the Fund. Purchasers may telephone the
Fund at (724) 935-5520 or (800) 860-3863, or write to the
address shown on the cover of this Prospectus to obtain further
information regarding dividend distributions. Fractional shares
will be allocated to each share account for all purchases and
redemptions, including reinvested distributions. For example,
if a purchase of $1,000 is made at a NAV of $11.76 per share, a
total of 85.034 shares will be credited to your share account on
the purchase date. Fractional shares are disregarded for all
voting purposes.
Certain brokerage firms have established omnibus accounts with
the Fund. These accounts may produce a high volume of daily
transactions. For this reason, brokerage firms holding accounts
in the Fund may place orders with the Fund to purchase and/or
redeem Fund shares via telephone.
AUTOMATIC INVESTMENT PLAN
The Fund offers an Automatic Investment Plan, which allows
shareholders to authorize the Muhlenkamp Fund to debit their
bank account for the purchase of Muhlenkamp Fund shares.
Investments can be made up to twice a month by automatically
deducting US $50 or more from the shareholder's bank account.
To participate in the automatic investment plan, a Muhlenkamp
Fund Account must be opened with a minimum of US $200 (IRAs
included). To establish an Automatic Investment Plan for a
Muhlenkamp Fund account, complete the Muhlenkamp Fund Automatic
Investment Application and include a voided, unsigned check or a
savings deposit/withdrawal slip for the bank account to be
debited. Additional information pertaining to the Automatic
Investment Plan is in the Statement of Additional Information,
which is available upon request.
HOW TO REDEEM SHARES
As an "Open-End" fund, the Fund offers to stand ready to redeem
AT NO CHARGE all or any portion of your shares on any day that a
NAV is calculated and the price paid to you will be the NAV per
share next determined after the Fund receives your request for
redemption. No telephone arrangements to redeem shares are being
offered by the Fund at this time. All redemption requests must
be in writing and signed by the owner(s) exactly as the account
is registered. Redemption requests are mailed to: Muhlenkamp
Fund, C/O American Data Services, Inc. , P.O. Box 5786,
Hauppauge, NY 11788. If share certificates have been issued,
the signature(s) on any issued share certificates must be
guaranteed by an official of a commercial bank or of a member
firm on the New York Stock Exchange. If a share certificate was
issued, it must be deposited with the Fund before a redemption
can be completed, along with all necessary legal documentation,
including but not necessarily limited to, a written redemption
request that has been signed and the signature guaranteed as
above indicated. Payment for redeemed shares will normally be
made by the Fund the next business day immediately following the
redemption date. The Fund may take up to 7 calendar days to
make redemption payments.
Shareholders participating in the Automatic Investment Plan may
have the proceeds of their redemption deposited directly into
the bank account previously designated on the Automatic
Investment Application. Under most circumstances, payments will
be transmitted on the third business day, or no later than 7
calendar days, following receipt of a valid request for
redemption by the Muhlenkamp Fund.
Any regular, non-IRA shareholder whose share account value falls
below a minimum investment amount of $100 based upon the actual
dollar amount invested (i.e., not affected by changes in market
value of the securities held by the Fund) may be provided
written notice by the Fund of its intention to involuntarily
redeem such share position. Shareholders receiving such notice
who wish to maintain their investment in the Fund may do so by
investing additional monies to raise the total investment
account to at least $200. A reasonable time period, not to be
less than 60 days, will be allowed shareholders to make this
decision prior to redemption. The Fund may delay payment of
redemption proceeds until it has determined that the purchase
check has cleared which may take up to 15 calendar days.
Although the Fund makes no redemption charge for shares
redeemed, regardless of the time since date of purchase, it
reserves the right to refuse or discontinue sale of shares to
any investor who, in the opinion of the Fund, is or may, by
frequent or short-term purchase and redemption request practices
or by other actions, disrupt normal Fund operations or who
otherwise, by carrying out such practices, could adversely
affect the interests of the Fund or its shareholders.
SYSTEMATIC WITHDRAWALS
Shareholders with accounts having a value of $5,000 or more may
direct that the Fund pay an automatic monthly withdrawal of any
amount to any designated payee by making such request in writing
and providing the signature(s) of the owner(s) exactly as the
account is registered. Requested withdrawals will require that
shares be redeemed as necessary each month to raise proceeds
sufficient to make such payments. Redemption of shares, whether
for normal voluntary or involuntary redemptions or for
systematic monthly withdrawal purposes, will result in the
shareholder realizing gains or losses for income tax purposes.
Proceeds from redemptions will normally be mailed to
shareholders at the address to which the account is registered
by the Fund or to properly designated payees. Shareholders may
also receive their proceeds from a systematic redemption
directly into their bank account via the Automated Clearing
House (ACH). Redemptions via ACH are performed on the 5th, 15th,
or 25th day of each month. If the 5th, 15th, or 25th day of the
month falls on a weekend or holiday, the redemption will occur
on the next business day. In order to receive proceeds from a
systematic redemption via the ACH system, a shareholder must
properly complete a Muhlenkamp Fund Automatic Withdrawal
Application. Systematic withdrawals for the purpose of making
monthly payments may reduce or exhaust an account. The right
is reserved to amend systematic monthly withdrawals any time on
thirty days written notice, which may be terminated at any time
by the investor or by the Fund with proper notice.
PORTFOLIO TRANSACTIONS
The policy of the Fund is to limit portfolio turnover to
transactions necessary to carry out its investment policies
and/or to obtain cash, as necessary, for redemptions of its
shares. The Fund's portfolio turnover rate, which is the lesser
of the total purchases or sales on an annualized basis, divided
by the average total market value of the assets held, will vary
from period to period depending upon market conditions. The
fund has had an average turnover rate of 31% over the last 7
years. It is anticipated the Fund will generally not exceed a
turnover rate of 100% per year in normal market conditions.
High portfolio turnover incurs additional brokerage costs and
creates portfolio gains or losses, which affect shareholder
return rates and taxes. Refer to sections herein entitled
"Broker Allocations" and "Federal Income Tax" for more
information on these subjects.
BROKER ALLOCATIONS
The placement of orders for the purchase and sale of portfolio
securities will be made under the control of the President of
the Fund, subject to the overall supervision of the Board of
Trustees. All orders are placed at the best price and best
execution obtainable, except that the Fund shall be permitted to
select broker-dealers who provide economic, corporate and
investment research services if in the opinion of the Fund's
management and Board of Directors, such placement serves the
best interests of the Fund and its shareholders.
FEDERAL TAX STATUS
It is intended that the Fund will elect and qualify for the
special treatment afforded a "regulated investment company"
under subchapter M of the Internal Revenue Code. Accordingly,
in any fiscal year in which the Fund distributes substantially
all of its taxable net income and otherwise qualifies as a
regulated investment company, it will be relieved of paying
federal income taxes. Dividends paid to shareholders by the
Fund are in effect distributions of its investment income.
Capital gains as well as dividends of investment income are
taxable to shareholders, regardless of whether a shareholder
chooses to take them in cash or receives them as additional
shares. Distributions by the Fund to its shareholders of long
and short-term capital gains realized, if any, retain their
character as capital gains. Long-term capital gains are
currently taxed differently from investment income and short-
term capital gains. From the standpoint of the shareholder who
requests redemption of shares by the Fund, as of the date of
this Prospectus, the tax treatment of any gain or loss realized
may be treated differently from ordinary investment income.
Because tax rules are changing, advice from shareholder's own
tax counsel is recommended regarding the taxability of Fund
distributions and the deductibility of Fund expenses. For tax
purposes, the Fund will notify all shareholders as soon as
possible after the end of each calendar year of all amounts and
types of dividends and distributions paid out and the amount of
the shareholder's allocable share of investment expenditures.
IRA AND RETIREMENT ACCOUNTS
Any employed individual and her or his spouse may open one or
more Individual Retirement Accounts ("IRAs") each, the number
and amounts limited only by the maximum allowed contribution per
year. Existing IRA accounts of any amount may also be "rolled
over" at any time into a new "self-directed IRA" account
invested in Fund shares. The Fund's custodian, Star Bank, is
empowered and agrees to act as custodian of all shares
purchased. Monies deposited into an IRA account with the Fund
may only be invested in its shares upon the filing of the
appropriate forms. The forms and disclosures needed before
investing IRA monies in Fund shares may be obtained by telephone
at (724) 935-5520 or (800) 860-3863, or in person or by written
request mailed to the address shown on the cover of this
prospectus. There are fees associated with maintaining or
closing an individual retirement account. A fee schedule is
attached to all IRA applications. All fees are subject to change
at any time.
Monies deposited into other types of profit-sharing, pension or
retirement plans, including Keogh accounts, may also be invested
in Fund shares. However, the qualification and certification of
such "Plans" must first be pre-arranged with the investor's own
pension or tax specialists who would assist and oversee all plan
compliance requirements. Although the Fund will endeavor to
provide assistance to those investors interested in establishing
such plans, it neither offers nor possesses the necessary
professional skills or knowledge regarding the establishment,
compliance or maintenance of retirement plans. Therefore, it is
recommended that professional counsel be retained by the
investor before investing other than IRA plan monies in Fund
shares.
YEAR 2000 STATEMENT
In anticipation of the millennium change Muhlenkamp & Company
has undertaken a Year 2000 project to ensure that all computer
applications meet standards required to process and report
properly. Muhlenkamp & Company intends to have its systems Year
2000 compliant by December 1998.
Muhlenkamp & Company has evaluated its vendor plans and is
actively monitoring project milestones. The principal
vendors/service providers to the Muhlenkamp Fund are American
Data Services Inc and Star Bank.
American Data Services (ADS)
The three primary systems utilized by ADS to service their
clients are the PAIRS System, Phoenix Software Services'
transfer agency system, and the Periphonics System. The PAIRS
and Periphonics systems were designed to be year 2000 compliant.
To date, tests on these systems have certified their year 2000
compliance. These tests will be completed by year-end 1998.
The Phoenix Software Services' transfer agency system was
scheduled to become Year 2000 compliant in two steps. The first
step has been accomplished. The second step will be completed
on schedule no later than December 1998.
Star Bank
As a National Bank, Star Bank is regulated by the Office of the
Comptroller of the Currency (OCC). The OCC includes Year 2000
compliance in regular annual exams and has specific standards
for all banks, including a requirement that the banks
demonstrate Year 2000 issues to be addressed by the end of 1998.
STATEMENT OF ADDITIONAL INFORMATION
for
MUHLENKAMP FUND
August 1, 1998
MUHLENKAMP FUND [the "Fund"], a series of the Wexford Trust, is
an open-end diversified management investment company organized
as a business trust.
This Statement of Additional Information is not a Prospectus but
rather should be read in conjunction with the Prospectus dated
the same date, a copy of which may be obtained without charge
from the Fund by calling or writing its corporate offices at the
address and telephone numbers herein noted.
Table of Contents
Page
Investment Objectives and 2
Policies................................................
Investment 3
Restrictions............................................
Non-Fundamental Investment 4
Restrictions............................................
History and Background of Investment 4
Advisor.................................................
.
Board of Trustees and 5
Officers................................................
Investment Advisory 6
Board...................................................
Brokerage 6
Allocations.............................................
Net Asset Value 6
Calculation.............................................
Purchase of 7
Shares..................................................
Redemption of 8
Shares..................................................
Federal Tax 8
Status..................................................
Capital 9
Structure...............................................
Performance 9
Data....................................................
Financial 1
Information............................................. 0
Appendix................................................ 1
Custodian: Investment Advisor: Transfer Agent
Star Bank Muhlenkamp & Co., Inc. American Data Services,
425 Walnut 12300 Perry Highway Inc.
Street Wexford, PA 15090-8318 150 Motor Pkwy
Cincinnati, OH Tel: (724) 935-5520 or Hauppauge, NY 11788
45201-1118 (800) 860-3863 Tel: (516) 385-9580
(513) 632-4603 e-mail: Fax: (516) 385-7909
[email protected]
Investment Objective and Policies
It is the intention of the Fund to attempt to maximize total
returns for its shareholders by seeking income from dividends
and interest as well as capital gains from increases in the
value of its investments. Investments will be in common stocks
most of the time unless the stock market environment has risen
to a point where the advisor to the Fund, Muhlenkamp & Co.,
Inc., (MCI), can no longer find equity securities that have been
determined to be undervalued. During such periods investments
will be made in fixed-income or debt investments until such time
as more attractive common stocks can be found for purchase.
MCI believes that the success of a stock is dependent upon, and
invariably a reflection of, the quality of management.
Therefore, the Fund spends time in an attempt to assess
management's ability prior to making a commitment to its shares
with Fund assets. The assessment may include an analysis of
historical financial achievements of the company, direct
discussions with management by telephone or in person,
visitations to the company, conversations with security
analysts who actively follow the company for investment
brokerage firms, and discussions with competitors, suppliers,
and customers of the company. While MCI feels this assessment
technique to be clearly instrumental to the success of the
investment, it should be recognized that judgments made by MCI
are purely subjective in nature. Therefore, there can be no
assurance that MCI will be successful in achieving its
investment objectives for the Fund.
It is MCI's belief that the objective of maximizing total return
to shareholders can only be achieved consistently over a long
investment horizon. Typically, this will mean that a stock may
be held for a three-to-five year period or longer if MCI, by its
own determination, feels that the recognition of true business
worth has not yet been attained in the stock's current market
quotation. Thus, the Fund serves little purpose for investors
who wish to take advantage of short-term fluctuations in its net
asset value per share.
Consistent with MCI's objective of seeking to maximize total
returns for Fund shareholders MCI from time to time may also
choose to invest some or all of the Fund's assets in fixed-
income or debt investments of the types more fully described in
the Fund's Prospectus dated this same date. Such investments
will be purchased and held during periods when MCI is unable to
find stocks that it believes have return expectations
commensurate with the risks that must be assumed by their
continued retention. (More detailed information regarding
certain types of fixed investment restrictions is contained in
the Appendix of this statement and the prospectus)
MCI recognizes that while the Fund remains small in size (less
than $100 million in total assets at current market), MCI may
have greater flexibility in achieving its objective of
maximizing total returns. As the Fund grows in size, it may
become more difficult for MCI to find securities to invest in
that meet the objectives of the Fund. This may also occur
during periods when the stock market in general has been rising
for a long period of
time. Therefore, the Fund has reserved unto itself the right to
limit its asset size by discontinuing sales of its shares at any
time. The Board of Trustees of the Fund may suspend sales
whenever in its collective wisdom it believes it necessary in
order for the Fund to continue to adhere to its stated
objective, or that for other reasons it would be in the best
interests of Fund shareholders to do so.
It should be clear to investors in Fund shares that MCI believes
income is important in maximizing total returns. The Fund's
advisor is aware that annual distributions of capital gains and
dividend/interest income earned on shares may result in a
shareholder paying additional federal, state and/or local income
taxes. (For Details, See Federal Tax Status.) Fund
shareholders should understand that when MCI makes investment
decisions, such tax considerations will be secondary to its
objective of attempting to maximize total returns. This policy
is partly based upon a belief by MCI that such taxes and tax
rates have little or no bearing on an individual company's
attractiveness as an investment. It is also founded on MCI's
belief that tax rates in general, are, or should be, of
declining importance to the investment decision-making process,
viewed in its widest sense. Tax deferred portfolios like IRA
and pension monies, are ideally suited for investment in shares
of the Fund for these reasons.
Investment Restrictions
Under the terms of the BY-LAWS of the Fund on file in its
Registration Statement under the Investment Company Act of
1940, the Fund has adopted certain investment restrictions which
cannot be changed or amended unless approved by the vote of a
majority of its outstanding shares as set forth in its BY-
LAWS and in accordance with requirements under the Investment
Company Act of 1940. Accordingly, the Fund will not:
[A] Invest in the purchase and sale of real estate.
[B] Invest in , futures, commodities or in commodity contracts,
restricted securities, mortgages, oil, gas, mineral or other
exploration or development programs.
[C] Borrow money, except for temporary purposes, and then only
in amounts not to exceed in the aggregate 5% of the market value
of its total assets at the time of such borrowing.
[D] Invest more of its assets than is permitted under
regulations in securities of other registered investment
companies, which restricts such investments to a limit of 5%
of the Fund's assets in any one registered investment company,
and 10% overall in all registered investment companies, in no
event to exceed 3% of the outstanding shares of any single
registered investment company.
Note: As of December 31, 1994, the Fund inadvertently had
invested more than (10%) of its funds in other investment
companies since its funds were placed in the Trust for U.S.
Securities. The Advisor erroneously believed that the Fund
received the attributes of the investments of the Trust for U.S.
Securities investments, as it does for tax purposes. Excess
funds will be utilized to directly purchase U.S. Treasury
Securities.
[E] Invest more than 5% of its total assets at the time of
purchase in securities of companies that have been in business
or been in continuous operation less than 3 years, including
the operations of any predecessor.
[F] Invest or deal in securities which do not have quoted
markets.
[G] Neither alone nor with all other series funds of the
Wexford Trust, own more than 10% of the outstanding voting
securities of any one issuer or company, nor will it, with at
least 75% of its total assets, invest more than 5% of its
assets in any single issue, valued at the time of purchase.
This restriction shall not be applicable for investments in U.S.
government or government agency securities.
[H] Invest 25% or more of its total assets valued at the time
of purchase in any one industry or similar group of companies,
except U.S. government securities.
[I] Maintain margin accounts, will not purchase its investments
on credit or margin, and will not leverage its investments,
except for normal transaction obligations during settlement
periods.
[J] Make any investment for the purpose of obtaining,
exercising or for planning to exercise voting control of subject
company.
[K] Sell securities short.
[L] Underwrite or deal in offerings of securities of other
issuers as a sponsor or underwriter nor invest any Fund
assets in restricted securities or issues that have not
been registered under the Securities Act of 1933 for sale to
the general public. (Note: The Fund may be deemed an
underwriter of securities when it serves as distributor of its
own shares for sale to or purchase from its shareholders.)
[M] Make loans to others or issue senior securities. For
these purposes the purchase of publicly distributed indebtedness
of any kind is excluded and not considered to be making a loan.
In regard to the restriction marked as item [D] above, the Fund
plans to utilize computerized cash management services offered
by its custodian, which services presently include reinvesting
overnight and short-term cash balances in shares of other
registered investment companies, better known as "money
market funds", whose primary objective is safety of
principal and maximum current income from holding highly
liquid, short-term, fixed investments, principally U.S.
government and agency issues. The Fund will not be acquiring
such shares as permanent investments but rather will be
utilizing such services solely for convenience and efficiency as
it tries to keep short-term monies invested at interest only
until such time as more permanent reinvestments can practically
be made in the ordinary course of business. Cash will be held
pending the purchase, sale or reinvestment of the Fund's assets.
As of December 31, 1994 the Fund shall limit custodian bank's
automatic investment of short-term funds so as not to "invest"
a greater percentage of its assets than is permitted by
regulation, which is presently 5% of its total assets in
securities of any single investment company nor more than 10% of
its total assets in securities of investment companies overall.
Non-Fundamental Investment Restrictions
Pursuant to Agreements with State Regulators, the Fund will not:
A. Invest in Real Estate Limited Partnerships.
B. Invest in warrants in excess of 5% of the Fund's Net Assets;
no more than 2% of the
Fund's net assets may be invested in warrants not listed
on the NY or American Stock
Exchanges.
C. Under normal market conditions the Fund may not hold more
than 15% of net assets in illiquid securities.
D. Lend its assets to any person or individual, except by the
purchase of bonds or other debt obligations customarily sold
to institutional investors. However, portfolio securities may
be loaned if collateral values are continuously maintained at
no less than 100% by "marking to market" daily and the
practice is fair, just and equitable as determined by a
finding that adequate provision has been made for margin
calls, termination of the loan, reasonable servicing fees
(including finders' fees), voting rights, dividend rights,
shareholder approval and disclosure. Such lending of
portfolio securities must also be within the limitations
approved by the Securities and Exchange Commission.
.
History and Background of Investment Advisor
The investment advisor to the Fund is Muhlenkamp & Co., Inc.,
[MCI]. MCI is a Pennsylvania corporation practicing as an
Investment Advisor. MCI is registered under the Investment
Advisors Act of 1940 with the Securities and Exchange Commission
and with the Pennsylvania Securities Commission, Harrisburg,
PA.
MCI is substantially owned by Mr. Ronald H. Muhlenkamp, its
principal officer, who is also the principal officer and a
trustee of the Fund. MCI was incorporated October 1, 1981,
succeeding a sole proprietorship of the same name which has been
offering investment advisory services under the direction and
control of Mr. Muhlenkamp since 1977. MCI's principal activity
is to provide investment advisory and consulting services under
contract to individuals, pension, profit-sharing, IRA and KEOGH
retirement plans, corporations, and non-profit organizations
generally located in the service area that includes the
continental U.S.
Mr. Ronald H. Muhlenkamp, MCI's principal investment
professional, has been employed or active as an investment
advisor doing investment research or managing investment
portfolios since 1970. In addition to the above duties, he
holds responsibilities as President and Director of MCI and is
the principal in charge of all its investment management and
research activities. Mr. Muhlenkamp received a degree in
engineering from the Massachusetts Institute of Technology and a
Masters of Business Administration degree from Harvard Business
School. In addition, Mr. Muhlenkamp is a Chartered Financial
Analyst in the Financial Analyst Federation.
Prior to his forming MCI, Mr. Muhlenkamp served two years with
Berkley Dean & Co., NYC., before spending five years as a
portfolio analyst with Integon Corporation, where he assumed
responsibility for management of its pension account. While
employed at Integon, Mr. Muhlenkamp had the opportunity to
extensively study major investment management practices and
philosophies of the past 30 years. In 1975 Mr. Muhlenkamp
joined C.S. McKee and Company where he was responsible for over
70 investment portfolios. In 1977 Mr. Muhlenkamp left C.S.
McKee and Company to form MCI. He is a member of the Economics
Club of Pittsburgh.
It is the intention of Mr. Muhlenkamp, when advising the Fund,
to follow an approach that is similar to the one he follows in
managing individual portfolios and which has been described
herein and in the Fund Prospectus.
However, relative to individually managed accounts , the Fund
will have more freedom to sell stocks when they reach price
targets, regardless of tax implications. This is so because
investment portfolios for individuals tend to be more
constrained by tax considerations than the Fund intends to be.
As a result, turnover for regulated investment company
portfolios, on average, is higher than for individual
portfolios.
MCI will not invest assets of any other managed account in
shares of the Fund except as directed in writing by a person
unaffiliated with the Fund or with MCI, who has authority to
make such direction. Any investments directed to be made in
Fund shares will be excluded from managed account assets for fee
purposes. Furthermore, MCI, its officers, directors and
affiliated persons, will refrain from expressing any opinion
concerning the Fund to
any other person or persons over whose assets MCI has investment
advisory responsibilities and for which services it receives
compensation. MCI, as investment advisor to the Fund,
renders such services under a contract that provides for payment
to MCI of a fee, calculated daily and paid monthly, at the rate
of 1% per annum of the Fund's assets. This rate is consistent
with that being charged by MCI to manage its other client
accounts, but is higher than the fee charged by most other
investment companies. The advisory contract between MCI and the
Fund is subject to approval annually by the Fund's Board of
Trustees, including a majority of the disinterested Trustees,
and is terminable upon 30 days written notice, one party to the
other.
All employees of the investment advisor who perform duties for
the Fund shall remain employees of MCI, which shall bear all
employment costs of such staff. If MCI ceases to operate for
any reason or assigns the contract, such contract is
automatically terminated. It is anticipated that total costs of
Fund operation will be restricted by regulations in those
states in which the Fund anticipates it will seek to be
registered. At present this maximum fee restriction is commonly
set at 2% of the total assets of the company.
Board of Trustees
The names of Board of Trustees of the Fund, as elected by
shareholders at the trust's Annual Meeting of Shareholders, and
their respective duties and affiliations are as follows:
Past Five Year
Position With Business
Name and Address The Fund Affiliations
and Primary
Occupation
Ronald H. President, Trustee Investment Advisor
Muhlenkamp* and Principal,
Investment Advisor Muhlenkamp &
and Company, Inc.
12300 Perry Hwy Treasurer & Principal,
Muhlenkamp &
Wexford, PA 15090 Trustee
Co., Inc.
Alfred E. Kraft Trustee Management
202 Fan Hollow Rd Consultant
Uniontown, PA 15401
Terrence McElligott Trustee President, West Penn
4103 Penn Ave Brush & Supply, Inc.
Pittsburgh, PA 15224
*Interested persons as defined under the Investment Company Act
of 1940
Pension or
Retirement Estimated
Position Aggregate Benefits Annual
Name with Fund Remunerati Accrued During Benefits
on Registrants Upon
latest fiscal Retirement
Year
Ronald H. Trustee & 0 0 0
Muhlenkamp Pres.
Alfred F. Kraft Trustee 0 0 0
Terrence Trustee 0 0 0
McElligott
Investment Advisory Board
Although the Fund currently has no advisory board, the BY-LAWS
of each fund series permits the President of the Fund, with the
approval of the Board of Trustees, to appoint up to 15
individuals to assist the president and the trustees to define
and set overall investment strategies in an attempt to reach the
Fund's investment objectives as stated. Members of this
advisory board will either be individuals of prominence or
persons who, in the judgment of the President of the Fund, may
be important to its success and growth. The duties of members
of the Advisory Board shall be totally external to the daily
operation of the Fund itself and such members shall serve
totally at the pleasure of the President. They will have no
direct, active contact with the Fund, they will have no
knowledge of its daily operations nor are they to be
considered control or access persons. They possess only
advisory responsibilities that will be sought by the President,
the Trustees, and by MCI from time to time as they alone deem
necessary or desirable.
It is intended, though not a contractual obligation or duty,
that one or more members of this Advisory Board may attend and
address some or all of the meetings of shareholders, as
arranged. Each Advisory Board member will be available to the
President of each fund and to MCI from time to time by phone
communication, to render advice and counsel, in hopes that such
advice and counsel will lead to a more successful investment
performance.
In the opinion of the advisor the combined experience and
insight of advisory board members tends to support the Fund's
objectives and is expected to prove useful to the investment
advisor to the Fund.
Brokerage Allocations
It is the Fund's policy to allocate brokerage business to the
best advantage and benefit of its shareholders. The President
of the Fund and MCI shall be responsible for directing all
transactions through brokerage firms of its choice. Further to
that policy, all securities transactions are made so as to
obtain the most efficient execution at the lowest transaction
cost. Nothing in this policy, however, is to be construed to
prohibit the Fund or MCI from allocating transactions to firms
whose brokerage charges may include the cost of providing
investment research, or other legally permitted services which
the Fund and MCI deem to be necessary and/or valuable to the
successful management of its assets. Each buy or sell order
will be placed according to the type, size and kind of order
involved and as each condition may demand, so as to attempt to
secure the best result for the Fund and its share-holders, all
factors considered.
Net Asset Value Calculation
The net asset value per share is computed by dividing the
aggregate market value of Fund assets daily, less its
liabilities, by the number of portfolio shares outstanding.
Portfolio securities are valued and net asset value per share is
determined as of the close of business on the New York Stock
Exchange (NYSE), which is currently 4:00 p.m. (New York City
time), on each day the NYSE is open and on any other day in
which there is a sufficient degree of trading in Fund portfolio
securities that the current net asset value per share might be
materially affected by changes in portfolio securities values.
NYSE trading is closed weekends and holidays, which are
listed as New Year's Day, President's Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving, and
Christmas.
Portfolio securities listed on an organized exchange are valued
on the basis of the last sale on the date the valuation is
made. Securities that are not traded on that day, and for which
market quotations are otherwise readily available, and over-the-
counter and other traded fixed-income or debt securities for
which market quotations are readily available, are valued on the
basis of the bid price at the close of business on that date.
Securities and other assets for which market quotations are not
readily available or have not traded are valued at fair value as
determined by procedures established by the Board of Trustees.
Notwithstanding the above, bonds and other fixed-income or debt
securities may be valued on the basis of prices determined by
procedures established by the Board of Trustees if it is the
belief of the Board of Trustees that such price determination
more fairly reflects the fair value of such securities. Such
procedures would commonly include pricing on a yield-to-maturity
basis as compared with similarly traded fixed-income or debt
securities. Money market instruments are valued at cost which
approximates market value unless the Board of Trustees
determines that such is not a fair value. The sale of common
shares of any series fund will be suspended during periods when
the determination of its net asset value is suspended pursuant
to rules or orders of the Securities and Exchange
Commission, or may be suspended by the Board of Trustees
whenever in its sole judgment it believes it is in the best
interest of shareholders to do so.
Purchase of Shares
Initial Purchases: Investors may begin an investment in Fund
shares with as little as US $200 (no minimum for an IRA), by
simply completing and signing the enclosed application form.
All accounts must have a valid tax identification number.
Return the form to Muhlenkamp Fund, C/O American Data Services,
P.O. Box 5786, Hauppauge, NY 11788, or (via overnight mail
courier): American Data Services, Inc. 150 Motor Pkwy. Hauppauge
NY 11788, along with a check made payable to the "MUHLENKAMP
FUND". A sample copy of the application form is made a
part of the Fund's Prospectus and is available to prospective
investors upon request to the Wexford Trust, which is the sole
distributor of Fund shares. The offering price of such purchases
will be at the net asset value per share next determined after
receipt by the Fund of a valid purchase order. The date on
which the application is accepted by the Fund and the net asset
value determination as of the close of business on that date
shall determine the purchase price and shall normally be the
purchase date for shares. Payment for shares purchased shall be
by check or receipt of good funds by the Fund, which reserves
the right to withhold or reject requests for purchases for any
reason, including uncollectible funds. In the event of a
cancellation of any purchase due to uncollectible funds, the
purchaser shall be liable for all administrative costs incurred
and for all other losses or charges for such invalid transfer
and/or purchase. Certified checks are not necessary to purchase
Fund shares. There shall be no sales charge for purchase of
shares of common stock of the Fund.
The Fund has authorized one or more brokers to accept on its
behalf purchase and redemption orders. Such brokers are
authorized to designate other intermediaries to accept purchase
and redemption orders on the Fund's behalf. The Fund will be
deemed to have received a purchase or redemption order when an
authorized broker or, if applicable, a broker's authorized
designee, accepts the order. Customer orders will be priced at
the Fund's Net Asset Value next computed after they are accepted
by an authorized broker, or the broker's authorized designee.
Subsequent Purchases: Purchases of shares made subsequent to
an initial purchase or purchases by a registered shareholder
may be made by mail to Muhlenkamp Fund, P.O. BOX 799,
Cincinnati, Ohio, 45264-0799. All subsequent purchases must
be made in increments of no less than $100, unless you are
participating in the Automatic Investment Plan where $50.00 is
the minimum. (See Automatic Investment Plan.) There is no
minimum purchase amount for IRAs and Retirement Accounts and
such amounts shall be due and payable in good funds to the
Fund on the purchase date. No sales charge shall be made for
subsequent purchases.
Reinvestments: The Fund will automatically reinvest all
dividend distributions to shareholders in additional shares of
the requested fund series at net asset value as next determined
as of the close of business on the payment date of such
dividend distribution, unless otherwise instructed by the
shareholder in writing prior to the record date for such
distributions.
Fractional Shares: When share purchases or redemptions are
made or when cash is requested by a shareholder, shares will be
issued or redeemed respectively, in fractions of a share,
calculated to the third decimal place. (Example: $1,000
invested in shares at a net asset value of $11.76 per share will
purchase 85.034 shares.)
Issuance of Share Certificates: All shareholders, by law, are
entitled to ask to have share certificates issued. Due to the
inconvenience, costs, and additional work involved with issuing
certificates, shareholders are being strongly encouraged to have
all shares held in an account maintained by the Fund itself, as
has become the custom within the mutual fund industry.
Automatic Investment Plan: The Automatic Investment Plan
allows shareholders to authorize the Muhlenkamp Fund to debit
their bank account for the purchase of Muhlenkamp Fund shares.
Investments can be made at least monthly by automatically
deducting $50 or more from the shareholder's bank account. In
order to participate in the Automatic Investment Plan an account
in the Muhlenkamp Fund must be opened with a minimum of $200
(IRAs included) and an application for automatic investment must
be completed. Cancellation of the automatic investment plan or
changes to the amount or frequency of the automatic purchase may
be made at any time, by notifying the Muhlenkamp Fund in writing
at least 5 days before the order is effective.
Shares will be purchased at the price next determined following
receipt of funds by the Muhlenkamp Fund. The Muhlenkamp Fund
will send a confirmation for every transaction, and a debit
entry will appear on the shareholder's bank statement. In the
event of a cancellation of any purchase due to uncollected
funds, the purchaser shall be liable for all administrative
costs incurred and for all other losses or charges for such
invalid transfer and/or purchase.
To establish an automatic investment plan for a Muhlenkamp Fund
account, complete the Muhlenkamp Fund Automatic Investment
Application and include a voided, unsigned check or a savings
deposit/withdrawal slip from the bank account to be debited.
This service will become effective 15 days after the Muhlenkamp
Fund receives the Automatic Investment Application in good
order.
Redemption of Shares
Shareholders may sell all or a portion of their shares to the
Fund on any day a NAV is calculated and such redemptions will
be made in the manner as described in detail in the Fund's
Prospectus dated this same date. All normal voluntary,
involuntary or Systematic Monthly Withdrawal redemptions are
subject to the terms and conditions as set forth in the
prospectus.
All shareholders, by law, are entitled to ask to have share
certificates issued. Due to the inconvenience, costs, and
additional work involved with issuing certificates,
shareholders are being strongly encouraged to have all shares
held in an account maintained by the Fund itself, as has become
the custom within the mutual fund industry. If share
certificates are issued for any reason, however, and are held by
a shareholder requesting the Fund to redeem shares, it is
required that such share certificates first be delivered in
person or by mail to the Fund in good form for transfer. The
share certificates must be signed and contain a proper
signature guarantee by an official of a commercial bank or a New
York Stock Exchange member firm, before redemption can take
place and payment for shares made to any redeeming
shareholder. The Fund shall have the right to refuse payment to
any registered shareholder until all legal documentation
necessary for a complete and lawful transfer is in the
possession of the Fund or its agents, to the complete
satisfaction of the Fund and its Board of Trustees.
Shareholders participating in the Automatic Investment Plan may
have the proceeds of their redemption deposited directly into
the account previously designated on the Automatic Investment
Application. Under most circumstances, payments will be
transmitted on the third business day or no later than 7
calendar days following receipt by the Muhlenkamp Fund of a
valid request for redemption.
Federal Income Tax
It is intended that the Fund qualify for and elect the special
tax treatment afforded a "regulated investment company" under
subchapter M of the Internal Revenue Code. To qualify, the Fund
must: (1) Make an election to be a regulated investment
company; (2) invest and re-invest so that at least 90 percent of
its gross income is derived from dividends, interest, payments
with respect to securities loans, and gains from the sale or
other disposition of stocks or securities; (3) Invest and re-
invest so that less than 30 percent of its gross income is
derived from the sale or other disposition of stock or
securities held for less than three months; (4) Satisfy
certain diversification requirements with respect to its
assets at the close of each quarter of the taxable year; (5)
Distribute to its shareholders substantially all of its
ordinary and capital gain net income.
Dividends paid out as distributions to Fund shareholders are
derived from interest and dividends it receives and from any net
capital gains the Fund may realize during the calendar year.
Dividends derived from investment income are taxable to
shareholders at ordinary income tax rates when received,
regardless of whether received as cash or as additional shares.
The information Fund shareholders will require in order to
correctly report the amount and type of dividends and
distributions on their tax returns will be provided by the Fund
early each calendar year, sufficiently in advance of the date
for filing a calendar year return. To avoid the Fund having to
withhold a portion of your dividends, it is necessary that you
supply the Fund with needed information, including a valid,
correct Social Security or Tax Identification Number.
A regulated investment company must also provide a written
statement on or before January 31 of the subsequent year
containing the following information: The name and address of
the regulated investment company; the name and address of
the shareholder; a statement indicating that the pass-through
entity is required to report the amount of the allocable
affected expenses pursuant to Regulation Section 1.67(n)(i)(i);
the amount of income deemed distributed to the investor; and
the amount of expenses required to be allocated to the investor.
Capital Structure
Under the terms of the Trust's Declaration of Trust, each Fund
shareholder has one vote per share of beneficial interest in the
Trust. A majority of shares, voting in accordance with the
terms as set forth in the Declaration and bylaws: (1) elects a
majority of Fund Trustees; (2) must approve advisory contracts;
(3) can terminate the Trust; and 4) generally holds powers to
determine and/or approve or disapprove fundamental Fund
policies. Required shareholder approvals shall be obtained at
annual or special meetings duly called and held for such
purposes. Trustees are elected to office for an indefinite term
and are charged with the responsibility of over- seeing the day
to day operation and affairs of the Fund for shareholders.
Trustees may appoint persons to fill vacancies without a meeting
or shareholder approval, so long as a majority of Trustees then
serving have been elected by shareholders.
Performance Data
The average total return quotations for 1, 5, and 10 years
ending on 12/31/97 are as follows. It equates the initial
amount to the Ending Redeemable Value: P(1+T)^n=ERV.
P = Initial Purchase of $1,000
T = Average Annual Total Return for the period.
n = Number of Years in the period.
ERV = Ending Redeemable Value at end of applicable 1, 5, and 10
year periods, or fraction thereof.
Period Initi Average Ending Redeemable
al Annual Value
Purch Return (12/31/97)
ase
1 Year $1,00 33.28% $1,333
(since 0
12/31/96)
5 Years $1,00 20.35% $2,525
(since 0
12/31/92)
Since $1,00 16.77% $4,142
Inception 0
(11/1/88)
The Fund measures performance in terms of total return, which is
calculated for any specified period of time by assuming the
purchase of shares of the Fund at the net asset value at the
beginning of the period. Each dividend or other distribution
paid by the Fund during such period is assumed to have been
reinvested at the net asset value on the reinvestment date. The
shares then owned as a result of this process are valued at the
net asset value at the end of the period. The percentage
increase is determined by subtracting the initial value of the
investment from the ending value and dividing the remainder by
the initial value.
The Fund's total return shows its overall dollar or percentage
change in value, including changes in share price and assuming
the Fund's dividends and capital gains distributions are
reinvested. A cumulative total return reflects the Fund's
performance over a stated period of time. An average annual
total return reflects the hypothetical annually compounded
return that would have produced the same cumulative return if
the Fund's performance had been constant over the entire period.
Total return figures are based on the overall change in value of
a hypothetical investment in the Fund. Because average annual
returns for more than one year tend to smooth out variations in
the Fund's return, investors should recognize that such figures
are not the same as actual year -by-year results.
Financial Information
The Fund's most current Financial Statements are provided to
all as part of the Prospectus and will also be furnished
without charge upon request by calling or writing the Fund at
the address on the cover of this Prospectus. The annual report
contains further information about the Fund's performance.
The Fund will mail a semi-annual report to shareholders
maintaining an active account on June 30th of the current
fiscal year. Annual reports will be mailed to shareholders
maintaining an active account on December 31st of the current
fiscal year. However, the fund will not mail duplicate
financial reports and prospectuses to shareholders having the
same address of record. Shareholders can obtain additional
copies of the financial reports and prospectus by calling or
writing the Fund at the address on the cover of this Prospectus.
Significant Shareholders
The following shareholders have a position with the Fund that is
greater than 5% of total net assets as of the date of this
statement:
National Financial Services
Charles Schwab & Company
APPENDIX
Bond Rating Categories as Defined by Standard & Poor's are
quoted in part and inserted herein for the information of
potential investors in the Fund as a reference as follows:
"A S&P's corporate or municipal debt rating is a current
assessment of the creditworthiness of an obligor with respect to
a specific obligation. This assessment may take into
consideration obligors such as guarantors, insurers or lessees.
The debt rating is not a recommendation to purchase, sell or
hold a security inasmuch as it does not comment as to market
price or suitability for a particular investor.
The ratings are based on current information furnished by the
issuer or obtained by S&P's from other sources it considers
reliable. S&P's does not perform any audit in connection with
any rating and may, on occasion, rely on unaudited financial
information. The ratings may be changed, suspended or withdrawn
as a result of changes in, or availability of, such
information, or for other circumstances.
The ratings are based, in varying degrees, on the following
considerations:
I.Likelihood of default-capacity and willingness of the obligor
as to the timely payment of interest and repayment of principal
in accordance with the terms of the obligation;
II. Nature of and provisions of the obligor;
III. Protection afforded by, and relative position of, the
obligation in the event of bankruptcy, reorganization or other
arrangement under the laws of bankruptcy and other laws
affecting creditors rights.
AAA - Debt rated AAA has the highest rating assigned by
S&P's. Capacity to pay interest and repay principal is extremely
strong.
AA - Debt rated AA has a very strong capacity to pay interest
and repay principal and differs from the highest rated issues
only in small degree.
A - Debt rated A has a strong capacity to pay interest and
repay principal although it is somewhat more susceptible to the
adverse effects of changes in circumstances and economic
conditions than debt in higher rated categories.
BBB - Debt rated BBB is regarded as having an adequate capacity
to pay interest and repay principal. Whereas it normally
exhibits adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead
to a weakened capacity to pay interest and repay principal
for debt in this category than in higher rated categories.
BB,B,CCC,CC,C - Debt rated BB,B,CCC,CC, and C is regarded, on
balance, as predominantly speculative with respect to capacity
to pay interest and repay principal in accordance with the
terms of the obligation. BB indicates the lowest degree of
speculation and C the highest degree of speculation. While such
debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or
major risk exposures to adverse conditions.
CI - The rating is reserved for income bonds on which no
interest is being paid.
D - Debt rated D is in default, and repayment of interest
and/or repayment of principal are in arrears.
NR - indicates that no rating has been requested, that there
is insufficient information on which to base a rating, or that
S&P does not rate a particular type of obligation as a matter
of policy."
PART C
RE REGISTRATION OF MUHLENKAMP FUND OF THE WEXFORD TRUST
============================================================
Item 24. (a) Financial Statements.
*1. Financial Statements with Notes. The Fund's annual
report for the fiscal year ending
December 31, 1997 or a more recent semi-annual report is being
sent with the Prospectus and are not sent with the
Statement of Additional Information.
(b) Exhibits.
** 1. Code of Ethics
** 2. Declaration of Trust, State of Massachusetts
** 3. Trust BY-LAWS, Including Indemnification Clause
** 4. Specimen Stock Certificate
** 5. Investment Advisory Contract
* 6. Agreement with Custodian Bank
** 7. Legal Opinion re Issuance of Shs. Bene. Int.
** 8. 20 Signed Original Investor Subscriptions
** 9. Specimen IRA Account Opening Form
* 10. Auditors Consent To Publish
Financial Statements
11. Copies of any other Opinions, appraisals or
Rulings and Consents to the use thereof
relied in the preparation of the registration statement.
(NOTE: All Item 24 exhibits have been or will be
provided as follows:
* Enclosed herewith
** Previously submitted in the registration
filed 11/15/88
Item 25. Persons Controlled by or Under Common Control with
Registrant.
None
Item 26. Number of Holders of Securities at June 30, 1998 is as
follows;
Title of Class Number of Record
Holders
Shares of Beneficial
Interest 19,423
Item 27. BY-LAWS Article XI, Indemnification of Officers
and Trustees:
(Indemnification Provision included herein by Reference
Article IV, Section 4.2 of
Declaration of Trust, included as an exhibit to the
Registration Statement filed 11/15/88, a copy of which
indemnification provision is attached as an exhibit
hereto,
which in summary provides that Trustees and Officers of
Wexford Trust-Muhlenkamp Fund shall be eligible to be
indemnified by the Trust for claims filed against them by
virtue of their acting in that capacity, excepting or
willful misconduct, breach of trust, bad faith, gross
negligence or reckless disregard of their official
duties and responsibilities.)
In addition, the investment Advisory Contract provides
that the Advisor will not be held liable for mistakes in
judgment unless the Advisor is guilty of willful
misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of reckless
disregard of its obligations under the Investment
Advisory Contract.
"Insofar as indemnification for liability arising under
the Securities Act of 1933 may be permitted by directors,
trustees, 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 SEC such indemnification is against public
policy as expressed in the Act and may therefore be
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 director, trustee, 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 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 respect to indemnification provisions, the Trust will
comply with Securities Act of 1933 releases #7220 and
11330.
Item 28. Business and Other Connections of Investment Advisor.
none
Item 29. Principal Underwriters.
Fund shares self-distributed
Item 30. Location of Accounts and Records.
American Data Services, Inc.
150 Motor Parkway
Hauppauge, N.Y. 11788
Item 31. Management Services.
None. Not applicable
Item
32. Undertakings None.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the Investment Company Act of 1940 the registrant has duly
caused this Registration Statement to be signed on its behalf by
the undersigned, thereto duly authorized, in the Village of
Wexford, the State of Pennsylvania, this 1st day of August,
1998.
/S/ Ronald H. Muhlenkamp
Wexford Trust By Ronald H. Muhlenkamp, President
BY: /S/ Ronald H. Muhlenkamp
Ronald H. Muhlenkamp, President & Trustee
BY: /S/ Alfred F. Kraft
Alfred F. Kraft, Trustee
BY: /S/ Terrence McElligott
Terrence McElligott, Trustee
MUHLENKAMP FUND APPLICATION
NAME OF APPLICANT
________________________________________________________________
Joint Tenant _______________________________________________
Social Security Number ________________________________________
Name of Co-Applicant
___________________________________________________________________
1 The account registration will be joint tenants with right of
survivorship unless otherwise specified.
2 Only one Social Security Number is needed for tax reporting.
Gift to__________________________________________________________ as
custodian for_____________________________________________________
a Minor________________________________________________________ under
the___________________ Uniform Gifts/Transfer to Minors Act.
A Trust___________________________________________________________ as trustee
for_________________________________________________________
under
agreement dated______________________________________________
Individual
Retirement
Account
My initial investment is a(n): IRA contribution for Tax Year 19 ____
Simplified Employee Pension-IRA (SEP-IRA)
contribution for Tax Year 19____
Rollover
or transfer from: (Check One)
Another IRA Employer-sponsored retirement
plan
SEP-IRA IRA Rollover [funds previously
received from
a distribution from an employer-
sponsored
retirement plan]
NOTE: If you are establishing an IRA account with the Muhlenkamp Fund you
must complete the 5305-A and Beneficiary Designation forms. If you are
transferring an IRA from another financial institution, custodian, or trustee,
you must also complete a Transfer Letter.
City ___________________________________________ State______________
Zip Code____________________________________________________________________
I am a citizen of U.S. Other (please specify)
I authorize Muhlenkamp Fund to open a New Account for purchase of its
common shares in accordance with these instructions and all applicable
provisions of this application as outlined in the current prospectus which
I have received. Under penalty of perjury, I certify (1) that the number
shown on this form is my correct taxpayer identification number and (2)
that I am not subject to backup withholding because (a) I have not been
notified that I am subject to backup withholding as a result of failure to
report all interest and dividends, or (b) the Internal Revenue Service has
notified me that I am no longer subject to backup withholding.
X_______________________________________________________________________-
ARTICLE IV
LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS
Section 4.1. No Personal Liability of Shareholders,
Trustees, Etc. No shareholder shall be subject to any
personal liability whatsoever to any Person in connection
with Trust Property or the acts, obligations or affairs of
the Trust. No Trustee, officer, employee or agent of the
Trust shall be subject to any personal liability whatsoever
to any Person, other than to the Trust or its Shareholders,
in connection with Trust Property or the affairs of the
Trust, save only that arising from bad faith, willful
misfeasance, gross negligence or reckless disregard of his
duties with respect to such Person; and all such Persons
shall look solely to the Trust Property for satisfaction of
claims of any other nature arising in connection with the
affairs of the Trust. If any Shareholder, Trustee, officer,
employee, or agent, as such, of the Trust, is made a party
to any suit or proceeding to enforce any such liability of
the Trust he shall not, on account thereof, be held to any
personal liability The Trust shall indemnify and hold each
Shareholder harmless from and against all claims and
liabilities, to which such Shareholder may become subject by
reasons of his being or having been a Shareholder, and shall
reimburse such Shareholder out of the Trust Property for all
legal and other expenses reasonably incurred by him in
connection with any such claim or liability Indemnification
and reimbursement required by the preceding sentence shall
be made only out of assets of the one or more Series whose
shares were held by said Shareholder at the time of the act
or event occurred which gave rise to the claim against or
liability of said Shareholder. The rights accruing to a
Shareholder under this Section 4.1 shall not exclude any
other right to which such Shareholder may be lawfully
entitled, nor shall anything herein contained restrict the
right of the Trust to indemnify or reimburse a Shareholder
in any appropriate situation even though not specifically
provided herein.
Section 4.2. Non-Liability of Trustees, Etc. No
Trustee, officer, employee or agent of the Trust shall be
liable to the Trust, its Shareholders, or to any
Shareholder, Trustee, officer, employee, or agent thereof
for any action or failure to act (including without
limitation the failure to compel in any way any former or
acting Trustee to redress any breach of trust) except for
his own bad faith, willful misfeasance, gross negligence or
reckless disregard of the duties involved in the conduct of
his office.
Section 4.3. Mandatory Indemnification. (a) Subject to
the exceptions and limitations contained in paragraph (b)
below:
(i) every person who is, or has been, a Trustee or
officer of the Trust shall be indemnified by the Trust to
the fullest extent permitted by law against all liability
and against all expenses reasonably incurred or paid by him
in connection with any claim, action suit or proceeding in
which he becomes involved as a party or otherwise by virtue
of his being or having been a Trustee or officer and against
amounts paid or incurred by in the settlement thereof;
(ii) the words "claim," "action," "suit,' or
"proceeding" shall apply to all claims, actions suits or
proceedings (civil, criminal, or other, including appeals),
actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys'
fees, costs, judgments, amounts paid in settlement, fines,
penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a
Trustee or officer:
(i) against any liability to the Trust or the
Shareholders by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties
involved in the conduct of his office;
(ii) with respect to any matter as to which he shall
have been finally adjudicated not to have acted in good
faith in the reasonable belief that his action was in the
best interest of the Trust;
(iii) in the event of a settlement or other disposition
not involving a final adjudication as provided in paragraph
(b)(ii) resulting in a payment by a Trustee or officer,
unless there has been a determination that such Trustee or
officer did not engage in willful misfeasance, bad faith,
involved in the conduct of his office:
(A) by the court or other body approving the settlement
or other disposition; or
(8) based upon a review of readily available facts (as
opposed to a full trial-type inquiry) by (x) vote of a
majority of the Non-interested Trustees acting on the matter
(provided that a majority of the Noninterested Trustees then
in office act on the matter) or (y) written opinion of
independent legal counsel.
(c) The rights of indemnification herein provided may
be insured against by policies maintained by the Trust,
shall be severable, shall not affect any other rights to
which any Trustee or officer may now or hereafter be
entitled, shall continue as to a person who has ceased to be
such Trustee or officer and shall inure to the benefit of
the heirs, executors, administrators and assigns of such a
person. Nothing contained herein shall affect any rights to
indemnification to which personnel of the Trust other than
Trustees and officers may be entitled by contract or
otherwise under law.
(d) Expenses of preparation and presentation of a
defense to any claim, action, suit or proceeding of the
character described in paragraph (a) of this Section 4 3 may
be advanced by the Trust prior to final disposition thereof
upon receipt of an undertaking by or on behalf of the
recipient to repay such amount if it is ultimately
determined that he is not entitled to indemnification under
this Section 4.3, provided that either:
(i) such undertaking is secured by a surety bond or
some other appropriate security provided by the recipient,
or the trust shall be insured against losses arising out of
any such advances; or
10
(ii) a majority of the Non-interested Trustees acting
on the matter (provided that a majority of the Non-
interested Trustees act on the matter) or an independent
legal counsel in a written opinion shall determine, based
upon a review of readily available facts (as opposed to a
full trial-type inquiry), that there is reason to believe
that the recipient ultimately will be found entitled to
indemnification.
As used in this Section 4.3, a Non-interested Trustee"
is one who is not (i) en "Interested Personal of the Trust
(including anyone who has been exempted from being an
"Interested Personal by any rule, regulation or order of the
Commission), or (ii) involved in the claim, action, suit or
proceeding.
Section 4.4. No Bond Required of Trustees. No Trustee
shall be obligated to give any bond or other security for
the performance of any of his duties hereunder.
Section 4.5. No Duty of Investigation; Notice in Trust
Instruments. Etc. No purchaser, lender, transfer agent or
other Person dealing with the Trustees or any officer,
employee or agent of the Trust shall be bound to make any
inquiry concerning the validity of any transaction
purporting to be made by the Trustees or by said officer,
employee or agent or be liable for the application of money
or property paid, loaned, or delivered to or on the order of
the Trustees or of said officer, employee or agent. Every
obligation, contract, instrument, certificate, Share, other
security of the Trust or undertaking, and every other act or
thing whatsoever executed in connection with the Trust shall
be conclusively presumed to have been executed or done by
the executors thereof only in their capacity as Trustees
under this Declaration or in their capacity as officers,
employees or agents of the Trust. Every written obligation,
contract, instrument, certificate, Share, other security of
the Trust or undertaking made or issued by the Trustees may
recite that the same is executed or made by them not
individually, but as Trustees under the Declaration, and
that the obligations of the Trust under any such instrument
are not binding upon any of the Trustees or Shareholders
individually, but bind only the trust estate, and may
contain any further recital which they or he may deem
appropriate, but the omission of such recital shall not
operate to bind the Trustees individually The Trustees shall
at all times maintain insurance for the protection of the
Trust Property, its Shareholders, Trustees, officers,
employees and agents in such amount as the Trustees shall
deem adequate to cover possible tort liability, and such
other insurance as the Trustees in their sole judgment shall
deem advisable.
Section 4.6. Reliance on Experts, Etc. Each Trustee and
officer or employee of the Trust shall, in the performance
of his duties, be fully and completely justified and
protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of
account or other records of the Trust, upon an opinion of
counsel, or upon reports made to the Trust by any of its
officers or employees or by the Investment Adviser, the
Administrator, the Distributor, Transfer Agent, selected
dealers, accountants, appraiser or other experts or
counsultants selected with reasonable care by the Trustees,
officers or employees of the Trust, regardless of whether
such counsel or expert may also be a Trustee
1 1
WEXFORD TRUST
MUHLENKAMP FUND
CROSS REFERENCE SHEET
Form N-1A Heading in
Item Number Prospectus
Prospetus Prospectus
1. Cover Page Cover Page
2. Synopsis Cover Page
3. Condensed Financial Information Financial
Information
4. General Description of Registrant Cover Page
5. Management of Fund The Trust; Investment Advisor
5A. Management Discussion of *
Funds Performance
6. Capital Stock and Capital of Trust
Other Securities
7. Purchase of Securities How to Buy Shares
being offered
8. Redemption or Repurchase How to Redeem Shares
9. Pending Legal Proceedings *
SAI SAI
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History *
13. Investment Objectives
and Policies Investment Objective
and Policies, Investment Restrictions
14. Management of the Fund Board of Trustees
15. Control Persons,
Principals and Board of Trustees Holders
16. Investment Advisory and History and Background
Other Services of Investment Advisor
17. Brokerage Allocation Brokerage Allocation
18. Capital Stock and Capital Structure
Other Securities
19. Purchase Redemption and
Pricing Purchase of Shares Redemption of Shares
20. Tax Status Federal Income Tax
21. Underwriter *
22. Calculations of Performance Data *Performance Data
23. Financial Statements Financial Information
* Not Applicable
