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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 30, 1996
FILE NO. 811-05813
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 11
CASH RESERVES PORTFOLIO
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
C/O SIGNATURE FINANCIAL GROUP (CAYMAN), LTD.
ELIZABETHAN SQUARE, GEORGE TOWN, GRAND CAYMAN, CAYMAN ISLANDS, BWI
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 809-945-1824
SUSAN JAKUBOSKI
C/O SIGNATURE FINANCIAL GROUP (CAYMAN), LTD.
ELIZABETHAN SQUARE, GEORGE TOWN, GRAND CAYMAN, CAYMAN ISLANDS, BWI
(NAME AND ADDRESS OF AGENT FOR SERVICE)
WITH A COPY TO
ROGER P. JOSEPH, ESQ.
BINGHAM, DANA & GOULD LLP
150 FEDERAL STREET
BOSTON, MASSACHUSETTS 02110 U.S.A.
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EXPLANATORY NOTE
This Registration Statement has been filed by the Registrant pursuant to
Section 8(b) of the Investment Company Act of 1940. However, beneficial
interests in the Registrant are not being registered under the Securities Act of
1933 (the "1933 Act") since such interests will be issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Registrant may only
be made by investment companies, insurance company separate accounts, common or
commingled trust funds or similar organizations or entities which are
"accredited investors" within the meaning of Regulation D under the 1933 Act.
This Registration Statement does not constitute an offer to sell, or the
solicitation of an offer to buy, any beneficial interests in the Registrant.
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PART A
Responses to Items 1 through 3 and 5A have been omitted pursuant to
paragraph 4 of Instruction F of the General Instructions to Form N-1A.
Item 4. General Description of Registrant.
Cash Reserves Portfolio (the "Portfolio") is a no-load, open-end
management investment company which was organized as a trust under the laws of
the State of New York on May 23, 1989. Beneficial interests in the Portfolio are
issued solely in private placement transactions which do not involve any "public
offering" within the meaning of Section 4(2) of the Securities Act of 1933, as
amended (the "1933 Act"). Investments in the Portfolio may only be made by
investment companies, insurance company separate accounts, common or commingled
trust funds or similar organizations or entities which are "accredited
investors" within the meaning of Regulation D under the 1933 Act. This
registration statement does not constitute an offer to sell, or the solicitation
of an offer to buy, any "security" within the meaning of the 1933 Act.
INVESTMENT OBJECTIVE
The investment objective of the Portfolio is to provide its investors with
liquidity and as high a level of current income as is consistent with the
preservation of capital. The investment objective of the Portfolio may be
changed without the approval of the investors in the Portfolio, but not without
written notice thereof to the investors in the Portfolio at least 30 days prior
to implementing the change. There can, of course, be no assurance that the
investment objective of the Portfolio will be achieved.
INVESTMENT POLICIES
The Portfolio seeks its objective by investing in high quality U.S.
dollar-denominated money market instruments. These instruments include
short-term obligations of the U.S. Government, bank obligations (such as
certificates of deposit, bankers' acceptances and fixed time deposits) of U.S.
and non-U.S. banks and obligations issued or guaranteed by the governments of
Western Europe, Scandinavia, Australia, Japan and Canada. The U.S. Government
obligations in which the Portfolio invests include U.S. Treasury bills, notes
and bonds, and instruments issued by U.S. Government agencies or
instrumentalities. Some obligations of U.S. Government agencies and
instrumentalities are supported by the "full faith and credit" of the United
States, others by the right of the issuer to borrow from the U.S. Treasury and
others only by the credit of the agency or instrumentality. Under the Investment
Company Act of 1940, as amended (the "1940 Act"), the Portfolio is classified as
"diversified." A "diversified investment company" must invest at least 75% of
its assets in cash and cash items, U.S. Government securities, investment
company securities and other securities limited as to any one issuer to not more
than 5% of the total assets of the investment company and not more than 10% of
the voting securities of the issuer.
CERTAIN ADDITIONAL INVESTMENT POLICIES
Maturity and Quality. All of the Portfolio's investments mature or are
deemed to mature within 397 days from the date of acquisition, and the average
maturity of the investments held by the Portfolio (on a dollar-weighted basis)
is 90 days or less. All of the Portfolio's investments are in "high quality"
securities (i.e., securities rated in the highest rating category for short-term
obligations by at least two nationally recognized statistical rating
organizations (each, an "NRSRO") assigning a rating to the security or issuer
or, if only one NRSRO assigns a rating, that NRSRO or, in the case of an
investment which is not rated, of comparable quality as determined by Citibank,
N.A. ("Citibank"), the Portfolio's investment adviser (the "Adviser")) and are
determined by the Adviser, pursuant to power delegated by the Portfolio's Board
of Trustees, to present minimal credit risks. Investments in high quality,
short-term instruments may, in many circumstances, result in a lower yield than
would be available from investments in instruments with a lower quality or a
longer term.
Investment Restrictions. Part B of this Registration Statement contains a
list of specific investment restrictions which govern the investment policies of
the Portfolio. Except as otherwise indicated, the Portfolio's investment
objective and policies may be changed without shareholder approval. If a
percentage or rating restriction (other than a restriction as to borrowing) is
adhered to at the time an investment is made, a later change in percentage or
rating resulting from changes in the Portfolio's securities will not be a
violation of policy.
Brokerage Transactions. The primary consideration in placing the
Portfolio's security transactions with broker-dealers for execution is to obtain
and maintain the availability of execution at the most favorable prices and in
the most effective manner possible.
INVESTMENT PRACTICES
Treasury Receipts. The Portfolio may invest in Treasury Receipts,
which are unmatured interest coupons of U.S. Treasury bonds and notes which
have been separated and resold in a custodial receipt program administered by
the U.S. Treasury.
Commercial Paper. The Portfolio may invest in commercial paper, which is
unsecured debt of corporations usually maturing in 270 days or less from its
date of issuance.
Asset-Backed Securities. The Portfolio may invest in asset-backed
securities, which represent fractional interests in underlying pools of assets,
such as car installment loans or credit card receivables. The rate of return on
asset-backed securities may be affected by prepayment of the underlying loans or
receivables. Reinvestment of principal may occur at higher or lower rates than
the original yield.
Repurchase Agreements. The Portfolio may enter into repurchase agreements.
Repurchase agreements are transactions in which an institution sells the
Portfolio a security at one price, subject to the Portfolio's obligation to
resell and the selling institution's obligation to repurchase that security at a
higher price normally within a seven day period. There may be delays and risks
of loss if the seller is unable to meet its obligations to repurchase.
Lending of Portfolio Securities. Consistent with applicable regulatory
requirements and in order to generate additional income, the Portfolio may lend
its securities to broker-dealers and other institutional borrowers. Such loans
must be callable at any time and continuously secured by collateral (cash or
U.S. Government securities) in an amount not less than the market value,
determined daily, of the securities loaned. It is intended that the value of
securities loaned by the Portfolio would not exceed 33 1/3% of the Portfolio's
net assets.
In the event of the bankruptcy of the other party to a securities loan,
the Portfolio could experience delays in recovering either the securities lent
or cash. To the extent that, in the meantime, the value of the securities lent
or sold have increased or the value of the securities purchased have decreased,
the Portfolio could experience a loss.
Private Placements and Illiquid Investments. The Portfolio may invest up
to 10% of its net assets in securities for which there is no readily available
market. These illiquid securities may include privately placed restricted
securities for which no institutional market exists. The absence of a trading
market can make it difficult to ascertain a market value for illiquid
investments. Disposing of illiquid investments may involve time-consuming
negotiation and legal expenses, and it may be difficult or impossible for the
Portfolio to sell them promptly at an acceptable price.
For more information regarding the Portfolio's permitted investments and
investment practices, see Part B of this Registration Statement.
CERTAIN RISK CONSIDERATIONS
The risks of investing in the Portfolio vary depending upon the nature of
the securities held, and the investment practices employed, on its behalf.
Certain of these risks are described below.
"Concentration" in Bank Obligations. The Portfolio invests at least 25% of
its assets, and may invest up to 100% of its assets, in bank obligations. This
concentration policy is fundamental, and may not be changed without the consent
of the Portfolio's investors. Banks are subject to extensive governmental
regulation which may limit both the amounts and types of loans and other
financial commitments which may be made and interest rates and fees which may be
charged. The profitability of this industry is largely dependent upon the
availability and cost of capital funds for the purpose of financing lending
operations under prevailing money market conditions. Also, general economic
conditions play an important part in the operation of this industry and exposure
to credit losses arising from possible financial difficulties of borrowers might
affect a bank's ability to meet its obligations under a letter of credit or
guarantee.
Non-U.S. Securities. All of the Portfolio's investments, including its
investments in non-U.S. securities, are in U.S. dollar-denominated
securities. However, investors in the Portfolio should be aware that
investments in non-U.S. securities involve risks relating to political,
social and economic developments abroad, as well as risks resulting from the
differences between the regulations to which U.S. and non-U.S. issuers and
markets are subject. These risks may include expropriation, confiscatory
taxation, withholding taxes on dividends and interest, limitations on the use
or transfer of Portfolio assets and political or social instability. In
addition, non-U.S. companies may not be subject to accounting standards or
governmental supervision comparable to U.S. companies, and there may be less
public information about their operations. Non-U.S. markets may be less
liquid and more volatile than U.S. markets, and may offer less protection to
investors such as the Portfolio.
Investment Practices. Certain of the investment practices employed for
the Portfolio may entail certain risks. See Part B of this Registration
Statement.
Item 5. Management of the Portfolio.
TRUSTEES
The Portfolio's Board of Trustees provides broad supervision over the
affairs of the Portfolio. A majority of the Portfolio's Trustees are not
affiliated with the Adviser. More information on the Trustees and officers of
the Portfolio appears in Part B of this Registration Statement.
INVESTMENT ADVISER
Citibank. Citibank is the Portfolio's investment adviser. The address of
Citibank is 153 East 53rd Street, New York, New York 10043. The Portfolio draws
on the strength and experience of Citibank. Citibank offers a wide range of
banking and investment services to customers across the United States and
throughout the world, and has been managing money since 1822. Its portfolio
managers are responsible for investing in money market, equity and fixed income
securities. Citibank and its affiliates manage more than $83 billion in assets
worldwide.
Citibank manages the assets of the Portfolio pursuant to an Investment
Advisory Agreement. Subject to policies set by the Portfolio's Trustees,
Citibank makes investment decisions for the Portfolio.
Advisory Fees. For its services under the Investment Advisory Agreement,
the Adviser receives an investment advisory fee, which is accrued daily and paid
monthly, of 0.15% of the Portfolio's average daily net assets on an annualized
basis for the Portfolio's then-current fiscal year. The Adviser has voluntarily
agreed to waive a portion of its investment advisory fee.
For the fiscal year ended August 31, 1996, the investment advisory fees
paid to Citibank, after waivers, were 0.06% of the Portfolio's average daily net
assets for that fiscal year.
Banking Relationships. Citibank and its affiliates may have deposit, loan
and other relationships with the issuers of securities purchased on behalf of
the Portfolio, including outstanding loans to such issuers which may be repaid
in whole or in part with the proceeds of securities so purchased. Citibank has
informed the Portfolio that, in making its investment decisions, it does not
obtain or use material inside information in the possession of any division or
department of Citibank or in the possession of any affiliate of Citibank.
Bank Regulatory Matters. The Glass-Steagall Act prohibits certain
financial institutions, such as Citibank, from underwriting securities of
open-end investment companies, such as the Portfolio. Citibank believes that its
services under the Investment Advisory Agreement and the activities performed by
it as sub-administrator are not underwriting and are consistent with the
Glass-Steagall Act and other relevant federal and state laws. However, there is
no controlling precedent regarding the performance of the combination of
investment advisory and sub-administrative activities by banks. State laws on
this issue may differ from applicable federal law and banks and financial
institutions may be required to register as dealers pursuant to state securities
laws. Changes in either federal or state statutes or regulations, or in their
interpretations, could prevent Citibank or its affiliates from continuing to
perform these services for the Portfolio. If Citibank or its affiliates were to
be prevented from acting as the Adviser or sub-administrator, the Portfolio
would seek alternative means for obtaining these services. The Portfolio does
not expect that investors would suffer any adverse financial consequences as a
result of any such occurrence.
ADMINISTRATIVE SERVICES PLAN
The Portfolio has an Administrative Services Plan which provides that the
Portfolio may obtain the services of an administrator, a transfer agent and a
custodian, and may enter into agreements providing for the payment of fees for
such services. Under the Administrative Services Plan, fees paid to the
Administrator may not exceed 0.05% of the Portfolio's average daily net assets
on an annualized basis for the Portfolio's then-current fiscal year. See
"Administrator" and "Transfer Agent, Custodian and Fund Accountant" below.
ADMINISTRATOR
Signature Financial Group (Cayman), Ltd. ("SFG") is the Portfolio's
administrator (the "Administrator"), and supervises the overall administration
of the Portfolio. The address of SFG is Elizabethan Square, George Town, Grand
Cayman, Cayman Islands, British West Indies. SFG provides certain administrative
services to the Portfolio under an administrative services agreement
("Administrative Services Agreement"). These administrative services include
providing general office facilities, supervising the overall administration of
the Portfolio, and providing persons satisfactory to the Board of Trustees to
serve as Trustees and officers of the Portfolio. These Trustees and officers may
be directors, officers or employees of SFG or its affiliates.
For these services, the Administrator receives fees accrued daily and paid
monthly of 0.05% of the assets of the Portfolio on an annualized basis for the
Portfolio's then-current fiscal year. The Administrator has voluntarily agreed
to waive a portion of the fees payable to it.
SFG is a wholly-owned subsidiary of Signature Financial Group, Inc.
SUB-ADMINISTRATOR
Pursuant to a sub-administrative services agreement, Citibank performs
such sub-administrative duties for the Portfolio as from time to time are agreed
upon by Citibank and SFG. Citibank's compensation as sub-administrator is paid
by SFG.
TRANSFER AGENT, CUSTODIAN AND FUND ACCOUNTANT
State Street Canada, Inc. ("State Street Canada") acts as transfer agent
and dividend disbursing agent for the Portfolio. State Street Canada also
provides fund accounting services to the Portfolio and calculates the daily net
asset value for the Portfolio. The address of State Street Canada is 40 King
Street West, Suite 5700, Toronto, Ontario, Canada. State Street Bank and Trust
Company ("State Street") acts as the custodian of the Portfolio's assets. The
address of State Street is 225 Franklin Street, Boston, Massachusetts 02110.
EXPENSES
The Portfolio pays all of its expenses, including the compensation of its
Trustees who are not affiliated with SFG; governmental fees; interest charges;
taxes; membership dues in the Investment Company Institute allocable to the
Portfolio; fees and expenses of independent auditors, of legal counsel and of
any transfer agent, custodian, registrar or dividend disbursing agent of the
Portfolio; insurance premiums; expenses of calculating the net asset value of
and the net income on the Portfolio; expenses connected with the execution,
recording and settlement of security transactions; fees and expenses of the
custodian for all services to the Portfolio, including safekeeping of funds and
securities and maintaining required books and accounts; expenses of preparing
and mailing reports to investors and to governmental officers and commissions;
and the advisory fees payable to the Adviser and the administrative fees payable
to the Administrator. For the fiscal year ended August 31, 1996, the Portfolio's
total expenses were 0.10% of its average net assets.
Item 6. Capital Stock and Other Securities.
Investments in the Portfolio have no preference, pre-emptive or conversion
rights and are fully paid and non-assessable, except as set forth below. The
Portfolio is not required and has no current intention to hold annual meetings
of investors, but the Portfolio will hold special meetings of investors when in
the judgment of the Trustees it is necessary or desirable to submit matters for
an investor vote. Investors have under certain circumstances (e.g., upon
application and submission of certain specified documents to the Trustees by a
specified number of shareholders) the right to communicate with other investors
in connection with requesting a meeting of investors for the purpose of removing
one or more Trustees. Investors also have the right to remove one or more
Trustees without a meeting by a declaration in writing by a specified number of
investors. Upon liquidation or dissolution of the Portfolio, investors would be
entitled to share pro rata in the net assets of the Portfolio available for
distribution to investors.
The Portfolio is organized as a trust under the laws of the State of New
York. Under the Declaration of Trust, the Trustees are authorized to issue
beneficial interests in the Portfolio. Each investor is entitled to a vote in
proportion to the value of its investment in the Portfolio. Investments in the
Portfolio may not be transferred, but an investor may withdraw all or any
portion of its investment at any time at net asset value. Investors in the
Portfolio (e.g., investment companies, insurance company separate accounts and
common and commingled trust funds) are each liable for all obligations of the
Portfolio. However, it is not expected that the liabilities of the Portfolio
would ever exceed its assets.
The net income of the Portfolio is determined each day the New York Stock
Exchange is open for trading (a "Business Day") (and on such other days as is
necessary in order to comply with the 1940 Act). This determination is made once
during each such day as of 3:00 p.m., Eastern time. All the net income of the
Portfolio so determined is allocated pro rata among the investors in the
Portfolio at the time of such determination.
For this purpose, the net income of the Portfolio (from the time of the
immediately preceding determination thereof) shall consist of (i) all income
accrued, less the amortization of any premium, on the assets of the Portfolio,
less (ii) all actual and accrued expenses of the Portfolio determined in
accordance with generally accepted accounting principles. Interest income
includes discount earned (including both original issue and market discount) on
discount paper accrued ratably to the date of maturity and any net realized
gains or losses on the assets of the Portfolio.
It is intended that the Portfolio's assets, income and distributions will
be managed in such a way that an investor in the Portfolio will be able to
satisfy the requirements of Subchapter M of the Internal Revenue Code of 1986,
as amended, assuming that the investor invested all of its investable assets in
the Portfolio.
Item 7. Purchase of Securities.
Beneficial interests in the Portfolio are issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Portfolio may only
be made by investment companies, insurance company separate accounts, common or
commingled trust funds or similar organizations or entities which are
"accredited investors" within the meaning of Regulation D under the 1933 Act.
This registration statement does not constitute an offer to sell, or the
solicitation of an offer to buy, any "security" within the meaning of the 1933
Act.
An investment in the Portfolio may be made without a sales load. All
investments are made at net asset value next determined after an order is
received by the Portfolio. The net asset value of the Portfolio is determined
once during each Business Day as of 3:00 p.m., Eastern time. Securities are
valued at amortized cost, which the Trustees of the Portfolio have determined in
good faith constitutes fair value for the purposes of complying with the 1940
Act. This valuation method will continue to be used until such time as the
Trustees of the Portfolio determine that it does not constitute fair value for
such purposes.
There is no minimum initial or subsequent investment in the Portfolio.
However, since the Portfolio intends to be as fully invested at all times as is
reasonably practicable in order to enhance the yield on its assets, investments
must be made in federal funds (i.e., monies credited to the account of the
Portfolio's custodian bank by a Federal Reserve Bank).
The Portfolio reserves the right to cease accepting investments at any
time or to reject any investment order.
The exclusive placement agent for the Portfolio is The Landmark Funds
Broker-Dealer Services, Inc. ("LFBDS"). The address of LFBDS is 6 St. James
Avenue, Boston, Massachusetts 02116. LFBDS receives no compensation for
serving as the exclusive placement agent for the Portfolio.
Item 8. Redemption or Repurchase.
An investor in the Portfolio may withdraw all or any portion of its
investment at any time at the net asset value next determined after a withdrawal
request in proper form is furnished by the investor to the Portfolio. The
proceeds of a withdrawal will be paid by the Portfolio in federal funds normally
on the Business Day the withdrawal is effected, but in any event within seven
days. Investments in the Portfolio may not be transferred.
The right of any investor to receive payment with respect to any
withdrawal may be suspended or the payment of the withdrawal proceeds postponed
during any period in which the New York Stock Exchange is closed (other than
weekends or holidays) or trading on such Exchange is restricted, or, to the
extent otherwise permitted by the 1940 Act, if an emergency exists.
Item 9. Pending Legal Proceedings.
Not applicable.
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PART B
Item 10. Cover Page.
Not applicable.
Item 11. Table of Contents.
Page
General Information and History........................ B-1
Investment Objective and Policies...................... B-1
Management of the Portfolio............................ B-10
Control Persons and Principal Holders
of Securities........................................ B-13
Investment Advisory and Other Services................. B-14
Brokerage Allocation and Other Practices............... B-17
Capital Stock and Other Securities..................... B-18
Purchase, Redemption and Pricing of
Securities........................................... B-19
Tax Status............................................. B-21
Underwriters........................................... B-23
Calculations of Performance Data....................... B-23
Financial Statements................................... B-23
Item 12. General Information and History.
Not applicable.
Item 13. Investment Objective and Policies.
The investment objective of Cash Reserves Portfolio (the "Portfolio") is
to provide its investors with liquidity and as high a level of current income as
is consistent with the preservation of capital. There can, of course, be no
assurance that the Portfolio will achieve its investment objective. The
investment objective of the Portfolio may be changed without the approval of the
investors in the Portfolio.
Except for the concentration policy with respect to bank obligations
described in paragraph (1) below, which is fundamental and may not be changed
without the approval of the investors in the Portfolio, the approval of the
investors in the Portfolio would not be required to change any of the
Portfolio's investment policies discussed below, including those concerning
securities transactions. Likewise, except for the concentration policy of the
Portfolio with respect to bank obligations described in paragraph (1) below,
which is fundamental and may not be changed without the approval of the
Portfolio's investors, the approval of the investors in the Portfolio would not
be required to change the Portfolio's investment objective.
The Portfolio seeks its investment objective through investments limited
to the following types of high quality U.S. dollar-denominated money market
instruments. All investments by the Portfolio mature or are deemed to mature
within 397 days from the date of acquisition and the average maturity of the
investments held by the Portfolio (on a dollar-weighted basis) is 90 days or
less. All investments by the Portfolio are in "high quality" securities (i.e.,
securities rated in the highest rating category for short-term obligations by at
least two nationally recognized statistical rating organizations (each, an
"NRSRO") assigning a rating to the security or issuer or, if only one NRSRO
assigns a rating, that NRSRO or, in the case of an investment which is not
rated, of comparable quality as determined by the Adviser) and are determined by
the Adviser to present minimal credit risks. Investments in high quality, short
term instruments may, in many circumstances, result in a lower yield than would
be available from investments in instruments with a lower quality or a longer
term. Under the Investment Company Act of 1940, as amended (the "1940 Act"), the
Portfolio is classified as "diversified." A "diversified investment company"
must invest at least 75% of its assets in cash and cash items, U.S. Government
securities, investment company securities and other securities limited as to any
one issuer to not more than 5% of the total assets of the investment company and
not more than 10% of the voting securities of the issuer.
(1) Bank obligations. The Portfolio invests at least 25% of its investable
assets, and may invest up to 100% of its assets, in bank obligations. This
concentration policy is fundamental and may not be changed without the
approval of the investors in the Portfolio. Bank obligations include, but
are not limited to, negotiable certificates of deposit, bankers'
acceptances and fixed time deposits. The Portfolio limits its investments
in U.S. bank obligations (including their non-U.S. branches) to banks
having total assets in excess of $1 billion and which are subject to
regulation by an agency of the U.S. Government. The Portfolio may also
invest in certificates of deposit issued by banks the deposits in which
are insured by the Federal Deposit Insurance Corporation ("FDIC"), through
either the Bank Insurance Fund or the Savings Association Insurance Fund,
having total assets of less than $1 billion, provided that the Portfolio
at no time owns more than $100,000 principal amount of certificates of
deposit (or any higher principal amount which in the future may be fully
insured by FDIC insurance) of any one of those issuers. Fixed time
deposits are obligations which are payable at a stated maturity date and
bear a fixed rate of interest. Generally, fixed time deposits may be
withdrawn on demand by the Portfolio, but they may be subject to early
withdrawal penalties which vary depending upon market conditions and the
remaining maturity of the obligation. Although fixed time deposits do not
have a market, there are no contractual restrictions on the Portfolio's
right to transfer a beneficial interest in the deposit to a third party.
U.S. banks organized under federal law are supervised and examined by
the Comptroller of the Currency and are required to be members of the
Federal Reserve System and to be insured by the FDIC. U.S. banks
organized under state law are supervised and examined by state banking
authorities and are members of the Federal Reserve System only if they
elect to join. However, state banks which are insured by the FDIC are
subject to federal examination and to a substantial body of federal law
and regulation. As a result of federal and state laws and regulations,
U.S. branches of U.S. banks, among other things, are generally required
to maintain specified levels of reserves, and are subject to other
supervision and regulation designed to promote financial soundness.
The Portfolio limits its investments in non-U.S. bank obligations
(i.e., obligations of non-U.S. branches and subsidiaries of U.S. banks,
and U.S. and non-U.S. branches of non-U.S. banks) to U.S.
dollar-denominated obligations of banks which at the time of investment
are branches or subsidiaries of U.S. banks which meet the criteria in
the preceding paragraphs or are branches of non-U.S. banks which (i)
have more than $10 billion, or the equivalent in other currencies, in
total assets; (ii) in terms of assets are among the 75 largest non-U.S.
banks in the world; (iii) have branches or agencies in the United
States; and (iv) in the opinion of the Citibank, N.A. ("Citibank"), the
Portfolio's investment adviser (the "Adviser"), are of an investment
quality comparable with obligations of U.S. banks which may be
purchased by the Portfolio. These obligations may be general
obligations of the parent bank, in addition to the issuing branch or
subsidiary, but the parent bank's obligations may be limited by the
terms of the specific obligation or by governmental regulation. The
Portfolio also limits its investments in non-U.S. bank obligations to
banks, branches and subsidiaries located in Western Europe (United
Kingdom, France, Germany, Belgium, the Netherlands, Italy,
Switzerland), Scandinavia (Denmark, Norway, Sweden), Australia, Japan,
the Cayman Islands, the Bahamas and Canada. The Portfolio does not
purchase any bank obligation of the Adviser or an affiliate of the
Adviser.
Since the Portfolio may hold obligations of non-U.S. branches and
subsidiaries of U.S. banks, and U.S. and non-U.S. branches of non-U.S.
banks, an investment in the Portfolio involves certain additional
risks. Such investment risks include future political and economic
developments, the possible imposition of non-U.S. withholding taxes on
interest income payable on such obligations held by the Portfolio, the
possible seizure or nationalization of non-U.S. deposits and the
possible establishment of exchange controls or other non-U.S.
governmental laws or restrictions applicable to the payment of the
principal of and interest on certificates of deposit or time deposits
that might affect adversely such payment on such obligations held by
the Portfolio. In addition, there may be less publicly-available
information about a non-U.S. branch or subsidiary of a U.S. bank or a
U.S. or non-U.S. branch of a non-U.S. bank than about a U.S. bank and
such branches and subsidiaries may not be subject to the same or
similar regulatory requirements that apply to U.S. banks, such as
mandatory reserve requirements, loan limitations and accounting,
auditing and financial record-keeping standards and requirements.
The provisions of federal law governing the establishment and operation
of U.S. branches do not apply to non-U.S. branches of U.S. banks.
However, the Portfolio may purchase obligations only of those non-U.S.
branches of U.S. banks which were established with the approval of the
Board of Governors of the Federal Reserve System (the "Board of
Governors"). As a result of such approval, these branches are subject
to examination by the Board of Governors and the Comptroller of the
Currency. In addition, such non-U.S. branches of U.S. banks are
subject to the supervision of the U.S. bank and creditors of the
non-U.S. branch are considered general creditors of the U.S. bank
subject to whatever defenses may be available under the governing
non-U.S. law and to the terms of the specific obligation. Nonetheless,
the Portfolio generally will be subject to whatever risk may exist that
the non-U.S. country may impose restrictions on payment of certificates
of deposit or time deposits.
U.S. branches of non-U.S. banks are subject to the laws of the state in
which the branch is located or to the laws of the United States. Such
branches are therefore subject to many of the regulations, including
reserve requirements, to which U.S. banks are subject. In addition,
the Portfolio may purchase obligations only of those U.S. branches of
non-U.S. banks which are located in states which impose the additional
requirement that the branch pledge to a designated bank within the
state an amount of its assets equal to 5% of its total liabilities.
Non-U.S. banks in whose obligations the Portfolio may invest may not be
subject to the laws and regulations referred to in the preceding two
paragraphs.
(2) Obligations of, or guaranteed by, non-U.S. governments. The Portfolio
limits its investments in non-U.S. government obligations to
obligations issued or guaranteed by the governments of Western Europe
(United Kingdom, France, Germany, Belgium, the Netherlands, Italy,
Switzerland), Scandinavia (Denmark, Norway, Sweden), Australia, Japan
and Canada. Generally, such obligations may be subject to the
additional risks described in paragraph 1 above in connection with the
purchase of non-U.S. bank obligations.
(3) Commercial paper rated Prime-1 by Moody's Investors Service, Inc.
("Moody's") or A-1 by Standard & Poor's Ratings Group ("Standard &
Poor's") or, if not rated, determined to be of comparable quality by the
Adviser, such as unrated commercial paper issued by corporations having an
outstanding unsecured debt issue currently rated Aaa by Moody's or AAA by
Standard & Poor's.
(4) Obligations of, or guaranteed by, the U.S. Government, its agencies or
instrumentalities. These include issues of the U.S. Treasury, such as
bills, certificates of indebtedness, notes and bonds, and issues of
agencies and instrumentalities established under the authority of an Act
of Congress. Some of the latter category of obligations are supported by
the full faith and credit of the United States, others are supported by
the right of the issuer to borrow from the U.S. Treasury, and still others
are supported only by the credit of the agency or instrumentality.
Examples of each of the three types of obligations described in the
preceding sentence are (i) obligations guaranteed by the Export-Import
Bank of the United States, (ii) obligations of the Federal National
Mortgage Association, and (iii) obligations of the Student Loan Marketing
Association, respectively.
(5) Repurchase agreements, providing for resale within 397 days or less,
covering obligations of, or guaranteed by, the U.S. Government, its
agencies or instrumentalities which may have maturities in excess of 397
days. A repurchase agreement arises when a buyer purchases an obligation
and simultaneously agrees with the vendor to resell the obligation to the
vendor at an agreed-upon price and time, which is usually not more than
seven days from the date of purchase. The resale price of a repurchase
agreement is greater than the purchase price, reflecting an agreed-upon
market rate which is effective for the period of time the buyer's funds
are invested in the obligation and which is not related to the coupon rate
on the purchased obligation. Obligations serving as collateral for each
repurchase agreement are delivered to the Portfolio's custodian either
physically or in book entry form and the collateral is marked to market
daily to ensure that each repurchase agreement is fully collateralized at
all times. A buyer of a repurchase agreement runs a risk of loss if, at
the time of default by the issuer, the value of the collateral securing
the agreement is less than the price paid for the repurchase agreement. If
the vendor of a repurchase agreement becomes bankrupt, the Portfolio might
be delayed, or may incur costs or possible losses of principal and income,
in selling the collateral. The Portfolio may enter into repurchase
agreements only with a vendor which is a member bank of the Federal
Reserve System or which is a "primary dealer" (as designated by the
Federal Reserve Bank of New York) in U.S. Government obligations. The
Portfolio will not enter into any repurchase agreements with the Adviser
or an affiliate of the Adviser. The restrictions and procedures described
above which govern the Portfolio's investment in repurchase agreements are
designed to minimize the Portfolio's risk of losses in making those
investments.
(6) Asset-backed securities, which may include securities such as Certificates
for Automobile Receivables ("CARS") and Credit Card Receivable Securities
("CARDS"), as well as other asset-backed securities that may be developed
in the future. CARS represent fractional interests in pools of car
installment loans, and CARDS represent fractional interests in pools of
revolving credit card receivables. The rate of return on asset-backed
securities may be affected by early prepayment of principal on the
underlying loans or receivables. Prepayment rates vary widely and may be
affected by changes in market interest rates. It is not possible to
accurately predict the average life of a particular pool of loans or
receivables. Reinvestment of principal may occur at higher or lower rates
than the original yield. Therefore, the actual maturity and realized yield
on asset-backed securities will vary based upon the prepayment experience
of the underlying pool of loans or receivables. (See "Asset-Backed
Securities.")
The Portfolio does not purchase securities which the Portfolio believes,
at the time of purchase, will be subject to exchange controls or non-U.S.
withholding taxes; however, there can be no assurance that such laws may not
become applicable to certain of the Portfolio's investments. In the event
exchange controls or non-U.S. withholding taxes are imposed with respect to any
of the Portfolio's investments, the effect may be to reduce the income received
by the Portfolio on such investments.
ASSET-BACKED SECURITIES
As set forth above, the Portfolio may purchase asset-backed securities
that represent fractional interests in pools of retail installment loans, both
secured (such as Certificates for Automobile Receivables) and unsecured, or
leases or revolving credit receivables, both secured and unsecured (such as
Credit Card Receivable Securities). These assets are generally held by a trust
and payments of principal and interest or interest only are passed through
monthly or quarterly to certificate holders and may be guaranteed up to certain
amounts by letters of credit issued by a financial institution affiliated or
unaffiliated with the trustee or originator of the trust.
Underlying automobile sales contracts, leases or credit card receivables
are subject to prepayment, which may reduce the overall return to certificate
holders. Nevertheless, principal repayment rates tend not to vary much with
interest rates and the short-term nature of the underlying loans, leases or
receivables tends to dampen the impact of any change in the prepayment level.
Certificate holders may also experience delays in payment on the certificates if
the full amounts due on underlying loans, leases or receivables are not realized
by the Portfolio because of unanticipated legal or administrative costs of
enforcing the contracts or because of depreciation or damage to the collateral
(usually automobiles) securing certain contracts, or other factors. If
consistent with its investment objective and policies, the Portfolio may invest
in other asset-backed securities that may be developed in the future.
LENDING OF SECURITIES
Consistent with applicable regulatory requirements and in order to
generate income, the Portfolio may lend its securities to broker-dealers and
other institutional borrowers. Such loans will usually be made only to member
banks of the U.S. Federal Reserve System and to member firms of the New York
Stock Exchange (and subsidiaries thereof). Loans of securities would be secured
continuously by collateral in cash, cash equivalents, or U.S. Treasury
obligations maintained on a current basis at an amount at least equal to the
market value of the securities loaned. The cash collateral would be invested in
high quality short-term instruments. The Portfolio would have the right to call
a loan and obtain the securities loaned at any time on customary industry
settlement notice (which will not usually exceed five days). During the
existence of a loan, the Portfolio would continue to receive the equivalent of
the interest or dividends paid by the issuer on the securities loaned and would
also receive compensation based on investment of the collateral. The Portfolio
would not, however, have the right to vote any securities having voting rights
during the existence of the loan, but would call the loan in anticipation of an
important vote to be taken among holders of the securities or of the giving or
withholding of its consent on a material matter affecting the investment. As
with other extensions of credit, there are risks of delay in recovery or even
loss of rights in the collateral should the borrower fail financially. However,
the loans would be made only to entities deemed by the Adviser to be of good
standing, and when, in the judgment of the Adviser, the consideration which can
be earned currently from loans of this type justifies the attendant risk. If the
Adviser determines to make loans, it is not intended that the value of the
securities loaned by the Portfolio would exceed 33 1/3% of the value of its net
assets.
INVESTMENT RESTRICTIONS
The Portfolio has adopted the following policies which may not be changed
without approval by holders of a "majority of the outstanding shares" of the
Portfolio, which as used in this Registration Statement means the vote of the
lesser of (i) 67% or more of the outstanding "voting securities" of the
Portfolio present at a meeting, if the holders of more than 50% of the
outstanding "voting securities" of the Portfolio are present or represented by
proxy, or (ii) more than 50% of the outstanding "voting securities" of the
Portfolio. The term "voting securities" as used in this paragraph has the same
meaning as in the 1940 Act.
The Portfolio may not:
(1) borrow money, except that as a temporary measure for extraordinary
or emergency purposes the Portfolio may borrow from banks in an amount not to
exceed 1/3 of the value of its net assets, including the amount borrowed from
banks (moreover, the Portfolio will not purchase any securities at any time at
which borrowings exceed 5% of its total assets (taken at market value)) (it is
intended that the Portfolio would borrow money only from banks and only to
accommodate requests for the withdrawal of all or a portion of a beneficial
interest in the Portfolio while effecting an orderly liquidation of securities);
for additional related restrictions, see clause (i) under the caption
"Non-Fundamental Restrictions" below;
(2) purchase any security or evidence of interest therein on margin,
except that the Portfolio may obtain such short term credit as may be necessary
for the clearance of purchases and sales of securities;
(3) underwrite securities issued by other persons and except insofar as
the Portfolio may technically be deemed an underwriter under the Securities Act
of 1933 in selling a security;
(4) make loans to other persons except (a) through the lending of
securities held by the Portfolio, but not in excess of 33 1/3% of the
Portfolio's net assets, (b) through the use of fixed time deposits or repurchase
agreements or the purchase of short term obligations, or (c) by purchasing all
or a portion of an issue of debt securities of types commonly distributed
privately to financial institutions; for purposes of this paragraph 4 the
purchase of short term commercial paper or a portion of an issue of debt
securities which are part of an issue to the public shall not be considered the
making of a loan; for additional related restrictions, see clause (x) under the
caption "Non-Fundamental Restrictions" below;
(5) purchase or sell real estate (including limited partnership
interests but excluding securities secured by real estate or interests therein),
interests in oil, gas or mineral leases, commodities or commodity contracts in
the ordinary course of business (the Portfolio reserves the freedom of action to
hold and to sell real estate acquired as a result of the ownership of securities
by the Portfolio);
(6) concentrate its investments in any particular industry, but if it is
deemed appropriate for the achievement of its investment objective, up to 25% of
the assets of the Portfolio (taken at market value at the time of each
investment) may be invested in any one industry, except that the Portfolio will
invest at least 25% of its assets and may invest up to 100% of its assets in
bank obligations; or
(7) issue any senior security (as that term is defined in the 1940 Act)
if such issuance is specifically prohibited by the 1940 Act or the rules and
regulations promulgated thereunder, except as appropriate to evidence a debt
incurred without violating Investment Restriction (1) above.
NON-FUNDAMENTAL RESTRICTIONS: The Portfolio does not as a matter of
operating policy:
(i) borrow money for any purpose in excess of 10% of its total assets
(taken at cost),
(ii) pledge, mortgage or hypothecate for any purpose in excess of 10%
of its net assets (taken at market value),
(iii) sell any security which it does not own unless by virtue of its
ownership of other securities the Portfolio has at the time of sale a right to
obtain securities, without payment of further consideration, equivalent in kind
and amount to the securities sold; provided, that if such right is conditional
the sale is made upon the same conditions,
(iv) invest for the purpose of exercising control or management,
(v) purchase securities issued by any registered investment company
except by purchase in the open market where no commission or profit to a sponsor
or dealer results from such purchase other than the customary broker's
commission or except when such purchase, though not made in the open market, is
part of a plan of merger or consolidation; provided, however, that the Portfolio
will not purchase the securities of any registered investment company if such
purchase at the time thereof would cause more than 10% of its total assets
(taken at the greater of cost or market value) to be invested in the securities
of such issuers or would cause more than 3% of the outstanding voting securities
of any such issuer to be held by the Portfolio; and provided, further, that the
Portfolio shall not purchase securities issued by any open-end investment
company,
(vi) taken together with any investments described in clause (x) below,
invest more than 10% of its net assets in securities that are not readily
marketable, including debt securities for which there is no established market
and fixed time deposits and repurchase agreements maturing in more than seven
days,
(vii) purchase securities of any issuer if such purchase at the time
thereof would cause the Portfolio to hold more than 10% of any class of
securities of such issuer, for which purposes all indebtedness of an issuer
shall be deemed a single class,
(viii) purchase or retain any securities issued by an issuer any of whose
officers, directors, trustees or security holders is an officer or Trustee of
the Portfolio, or is an officer or director of the Adviser, if after the
purchase of the securities of such issuer by the Portfolio one or more of such
persons owns beneficially more than 1/2 of 1% of the shares or securities, or
both, all taken at market value, of such issuer, and such persons owning more
than 1/2 of 1% of such shares or securities together own beneficially more than
5% of such shares or securities, or both, all taken at market value,
(ix) write, purchase or sell any put or call option or any combination
thereof,
(x) taken together with any investments described in clause (vi) above,
invest in securities which are subject to legal or contractual restrictions on
resale (other than fixed time deposits and repurchase agreements maturing in not
more than seven days) if, as a result thereof, more than 10% of the net assets
(taken at market value) would be so invested (including fixed time deposits and
repurchase agreements maturing in more than seven days),
(xi) purchase securities of any issuer if such purchase at the time
thereof would cause more than 10% of the voting securities of such issuer to be
held by the Portfolio, or
(xii) make short sales of securities or maintain a short position, unless
at all times when a short position is open it owns an equal amount of such
securities or securities convertible into or exchangeable, without payment of
any further consideration, for securities of the same issue as, and equal in
amount to, the securities sold short, and unless not more than 10% of the net
assets of the Portfolio (taken at market value) is held as collateral for such
sales at any one time. (The Portfolio does not presently intend to make such
sales.)
These policies are not fundamental and may be changed by the Portfolio
without the approval of the investors in the Portfolio.
PERCENTAGE AND RATING RESTRICTIONS: If a percentage or a rating
restriction on investment or utilization of assets set forth above or referred
to elsewhere in this Registration Statement is adhered to at the time an
investment is made or assets are so utilized, a later change in percentage
resulting from changes in the value of the securities held by the Portfolio or a
later change in the rating of a security held by the Portfolio is not considered
a violation of policy.
Item 14. Management of the Portfolio.
The Trustees and officers of the Portfolio and their principal occupations
during the past five years are set forth below. Their titles may have varied
during that period. Asterisks indicate that those Trustees and officers are
"interested persons" (as defined in the 1940 Act) of the Portfolio. Unless
otherwise indicated below, the address of each Trustee and officer is 6 St.
James Avenue, Boston, Massachusetts. The address of the Portfolio is Elizabethan
Square, George Town, Grand Cayman, Cayman Islands, British West Indies.
TRUSTEES
ELLIOTT J. BERV (aged 53) - Chairman and Director, Catalyst, Inc. (Management
Consultants) (since August, 1992); President, Chief Operating Officer and
Director, Deven International, Inc. (International Consultants) (June, 1991
to July, 1992); President and Director, Elliott J. Berv & Associates
(Management Consultants) (since May, 1984). His address is 15 Stornoway
Drive, Cumberland Foreside, Maine.
PHILIP W. COOLIDGE* (aged 45) - President of the Portfolio; Chairman, Chief
Executive Officer and President, Signature Financial Group, Inc. and The
Landmark Funds Broker-Dealer Services, Inc. (since December, 1988).
MARK T. FINN (aged 53) - President and Director, Delta Financial, Inc. (since
June, 1983); Chairman of the Board and Chief Executive Officer, FX 500 Ltd.
(Commodity Trading Advisory Firm) (since April, 1990); Director, Vantage
Consulting Group, Inc. (since October, 1988). His address is 3500 Pacific
Avenue, P.O. Box 539, Virginia Beach, Virginia.
WALTER E. ROBB, III (aged 70) - President, Benchmark Advisors, Inc.
(Corporate Financial Advisors) (since 1989); Trustee of certain registered
investment companies in the MFS Family of Funds. His address is 35 Farm
Road, Sherborn, Massachusetts.
OFFICERS
PHILIP W. COOLIDGE* (aged 45) - President of the Portfolio; Chairman, Chief
Executive Officer and President, Signature Financial Group, Inc. and The
Landmark Funds Broker-Dealer Services, Inc. (since December, 1988).
SAMANTHA M. BURGESS* (aged 27) - Assistant Secretary and Assistant Treasurer
of the Portfolio; Assistant Vice President, Signature Financial Group, Inc.
(since November, 1995); Graduate Student, Loyola University (prior to August,
1995).
CHRISTINE A. DRAPEAU* (aged 26) - Assistant Secretary and Assistant Treasurer of
the Portfolio; Assistant Vice President, Signature Financial Group, Inc. (since
January, 1996); Paralegal and Compliance Officer, various financial companies
(July, 1992 to January, 1996); Graduate Student, Bentley College (prior to
December, 1994).
JOHN R. ELDER* (aged 48) - Treasurer of the Portfolio; Vice President,
Signature Financial Group, Inc. (since April, 1995); Treasurer, The Landmark
Funds Broker-Dealer Services, Inc. (since April, 1995); Treasurer, Phoenix
Family of Mutual Funds (Phoenix Home Life Mutual Insurance Company) (1983 to
March, 1995).
LINDA T. GIBSON* (aged 31) - Secretary of the Portfolio; Vice President,
Signature Financial Group, Inc. (since May, 1992); Assistant Secretary, The
Landmark Funds Broker-Dealer Services, Inc. (since October, 1992); Law
Student, Boston University School of Law (September, 1989 to May, 1992).
JOAN R. GULINELLO* (aged 41) - Assistant Secretary and Assistant Treasurer of
the Portfolio; Vice President, Signature Financial Group, Inc. (since
October, 1993); Secretary, The Landmark Funds Broker-Dealer Services, Inc.
(since October, 1995); Vice President and Assistant General Counsel,
Massachusetts Financial Services Company (prior to October, 1993).
JAMES E. HOOLAHAN* (aged 49) - Vice President, Assistant Secretary and
Assistant Treasurer of the Portfolio; Senior Vice President, Signature
Financial Group, Inc.
SUSAN JAKUBOSKI* (aged 32) - Vice President, Assistant Secretary and
Assistant Treasurer of the Portfolio; Vice President, Signature Financial
Group (Cayman), Ltd. (since August, 1994); Senior Fund Administrator,
Signature Financial Group, Inc. (since August, 1994); Assistant Treasurer,
Signature Broker-Dealer Services, Inc. (since September, 1994); Fund
Compliance Administrator, Concord Financial Group (November, 1990 to August,
1994). Her address is Elizabethan Square, George Town, Grand Cayman, Cayman
Islands, BWI.
MOLLY S. MUGLER* (aged 45) - Assistant Secretary and Assistant Treasurer of
the Portfolio; Vice President, Signature Financial Group, Inc.; Assistant
Secretary, The Landmark Funds Broker-Dealer Services, Inc. (since December,
1988).
KARYN A. NOKE* (aged 25) - Vice President, Assistant Secretary and Assistant
Treasurer of the Portfolio; Vice President, Signature Financial Group
(Cayman), Ltd. (since September, 1996); Assistant Vice President, Signature
Financial Group, Inc. (May, 1993 to August, 1996); Student, University of
Massachusetts (prior to May, 1993).
SHARON M. WHITSON* (aged 48) - Assistant Secretary and Assistant Treasurer of
the Portfolio; Assistant Vice President, Signature Financial Group, Inc.
(since November, 1992); Associate Trader, Massachusetts Financial Services
Company (prior to November, 1992).
JULIE J. WYETZNER* (aged 37) - Vice President, Assistant Secretary and
Assistant Treasurer of the Portfolio; Vice President, Signature Financial
Group, Inc.
The Trustees and officers of the Portfolio also hold comparable positions
with certain other funds for which Signature Financial Group (Cayman), Ltd.
("SFG"), the Portfolio's administrator and a wholly-owned subsidiary of
Signature Financial Group, Inc., or an affiliate serves as the distributor or
administrator. Mr. Coolidge is also a Trustee of Landmark Funds III, Landmark
Premium Funds and Landmark Institutional Trust, open-end investment companies,
series of each of which are investors in the Portfolio, and each officer of the
Portfolio holds the same position with those investment companies. Each officer
of the Portfolio holds similar positions with Excelsior Funds, an open-end
registered investment company, a series of which is an investor in the
Portfolio.
The Trustees of the Portfolio (with the exception of Mr. Coolidge, who
received no remuneration from the Portfolio) received the following remuneration
from the Portfolio during its fiscal year ended August 31, 1996:
TOTAL
COMPENSATION
PENSION OR FROM
RETIREMENT REGISTRANT
AGGREGATE BENEFITS ESTIMATED AND FUND
COMPENSATION ACCRUED AS ANNUAL COMPLEX PAID
NAME OF PERSON, FROM PART OF FUND BENEFITS UPON TO
POSITION REGISTRANT EXPENSES RETIREMENT TRUSTEES(1)
--------------- ---------- -------- ------------- -----------
Elliott J. Berv,
Trustee $4,820.78 -- -- $42,000.00
Mark T. Finn,
Trustee $4,072.98 -- -- $42,000.00
Walter E. Robb,
III, Trustee $7,495.67 -- -- $46,500.00
- --------------------------------
(1) Messrs. Coolidge, Berv, Finn and Robb are trustees of 28, 12, 14 and 12
funds, respectively, of the Landmark Family of Funds.
The Portfolio's Declaration of Trust provides that it will indemnify its
Trustees and officers against liabilities and expenses incurred in connection
with litigation in which they may be involved because of their offices with the
Portfolio, unless, as to liability to the Portfolio or its investors, it is
finally adjudicated that they engaged in willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in their offices, or
unless with respect to any other matter it is finally adjudicated that they did
not act in good faith in the reasonable belief that their actions were in the
best interests of the Portfolio. In the case of settlement, such indemnification
will not be provided unless it has been determined by a court or other body
approving the settlement or other disposition, or by a reasonable determination,
based upon a review of readily available facts, by vote of a majority of
disinterested Trustees or in a written opinion of independent counsel, that such
officers or Trustees have not engaged in willful misfeasance, bad faith, gross
negligence or reckless disregard of their duties.
Item 15. Control Persons and Principal Holders of Securities.
Landmark Cash Reserves (a series of Landmark Funds III), Premium Liquid
Reserves (a series of Landmark Premium Funds), Landmark Institutional Liquid
Reserves (a series of Landmark Institutional Trust) and Excelsior Institutional
Money Fund (a series of Excelsior Funds) (collectively, the "Funds") and Citi
Liquid Reserves, Ltd., Citi Premium Liquid Reserves, Ltd., Citi Institutional
Liquid Reserves, Ltd. and Citi Institutional Liquidity Fund PLC USD II
(collectively, the "Citi Funds") own all of the beneficial interests in the
Portfolio. The following is a list of the record holders of beneficial interests
in the Portfolio:
BENEFICIAL INTEREST
NAME OF RECORD HOLDER (as of 12/16/96)
------------------------------------------------------------
Landmark Cash Reserves 25.65%
Premium Liquid Reserves 6.28%
Landmark Institutional Liquid
Reserves 28.87%
Excelsior Institutional Money
Market Fund 5.58%
Citi Liquid Reserves, Ltd. 0.38%
Citi Premium Liquid Reserves, Ltd. 0.91%
Citi Institutional Liquid
Reserves, Ltd. 31.96%
Citi Institutional Liquidity
Fund PLC USD II 0.37%
The Funds are registered investment companies which have informed the
Portfolio that whenever requested to vote on matters pertaining to the
Portfolio, each will hold a meeting of shareholders and will cast its vote as
instructed by its shareholders.
Item 16. Investment Advisory and Other Services.
Citibank manages the assets of the Portfolio pursuant to an investment
advisory agreement (the "Advisory Agreement"). Subject to such policies as the
Board of Trustees of the Portfolio may determine, the Adviser manages the
securities of the Portfolio and makes investment decisions for the Portfolio.
The Adviser furnishes at its own expense all services, facilities and personnel
necessary in connection with managing the Portfolio's investments and effecting
securities transactions for the Portfolio. The Advisory Agreement will continue
in effect as long as such continuance is specifically approved at least annually
by the Board of Trustees of the Portfolio or by a vote of a majority of the
outstanding voting securities of the Portfolio, and, in either case, by a
majority of the Trustees of the Portfolio who are not parties to the Advisory
Agreement or interested persons of any such party, at a meeting called for the
purpose of voting on the Advisory Agreement.
The Advisory Agreement provides that the Adviser may render services to
others. The Advisory Agreement is terminable without penalty on not more than 60
days' nor less than 30 days' written notice by the Portfolio when authorized
either by a vote of a majority of the outstanding voting securities of the
Portfolio or by a vote of a majority of its Board of Trustees, or by the Adviser
on not more than 60 days' nor less than 30 days' written notice, and will
automatically terminate in the event of its assignment. The Advisory Agreement
provides that neither the Adviser not its personnel shall be liable for any
error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in the execution of security transactions
for the Portfolio, except for willful misfeasance, bad faith or gross negligence
or reckless disregard of its or their obligations and duties under the Advisory
Agreement.
Part A of this Registration Statement contains a description of the fees
payable to the Adviser for services under the Advisory Agreement. For the fiscal
years ended August 31, 1994, August 31, 1995 and August 31, 1996, the fees
payable to the Adviser under the Advisory Agreement were $1,806,314, $4,097,854
and $6,140,512, respectively (of which $943,419, $2,306,161 and $3,426,821,
respectively, were voluntarily waived).
The Portfolio has adopted an Administrative Services Plan (the
"Administrative Plan") which provides that the Portfolio may obtain the services
of an administrator, a transfer agent and a custodian, and may enter into
agreements providing for the payment of fees for such services. Under the
Administrative Plan, the administrative services fee payable to SFG may not
exceed 0.05% of the Portfolio's average daily net assets on an annualized basis
for its then-current fiscal year. The Administrative Plan continues in effect if
such continuance is specifically approved at least annually by a vote of both a
majority of the Portfolio's Trustees and a majority of the Portfolio's Trustees
who are not "interested persons" of the Portfolio and who have no direct or
indirect financial interest in the operation of the Administrative Plan or in
any agreement related to such Plan ("Qualified Trustees"). The Administrative
Plan requires that the Portfolio provide to its Board of Trustees and the Board
of Trustees review, at least quarterly, a written report of the amounts expended
(and the purposes therefor) under the Administrative Plan. The Administrative
Plan may be terminated at any time by a vote of a majority of the Portfolio's
Qualified Trustees or by a vote of a majority of the outstanding voting
securities of the Portfolio. The Administrative Plan may not be amended to
increase materially the amount of permitted expenses thereunder without the
approval of a majority of the outstanding voting securities of the Portfolio and
may not be materially amended in any case without a vote of the majority of both
the Trustees and the Qualified Trustees.
Pursuant to an Administrative Services Agreement (the "Administrative
Services Agreement"), SFG provides the Portfolio with general office facilities
and supervises the overall administration of the Portfolio, including, among
other responsibilities, the negotiation of contracts and fees with, and the
monitoring of performance and billings of, the independent contractors and
agents of the Portfolio; preparation and filing of all documents required for
compliance by the Portfolio with applicable laws and regulations; and arranging
for the maintenance of books and records of the Portfolio. The Administrator
provides persons satisfactory to the Board of Trustees of the Portfolio to serve
as officers of the Portfolio. Such officers, as well as certain other employees
and Trustees of the Portfolio, may be directors, officers or employees of the
Administrator or its affiliates.
The Administrative Services Agreement continues in effect if such
continuance is specifically approved at least annually by the Portfolio's Board
of Trustees or by a vote of a majority of the outstanding voting securities of
the Portfolio and, in either case, by a majority of the Trustees of the
Portfolio who are not parties to the Administrative Services Agreement or
interested persons of any such party. The Administrative Services Agreement
terminates automatically if it is assigned and may be terminated without penalty
by a vote of a majority of the outstanding voting securities in the portfolio or
by either party on not more than 60 days' nor less than 30 days; written notice.
The Administrative Services Agreement also provides that neither SFG, as the
Administrator, nor its personnel shall be liable for any error of judgment or
mistake of law or for any act or omission in the administration or management of
the portfolio, except for willful misfeasance, bad faith or gross negligence in
the performance of its or their duties or by reason of reckless disregard of its
or their obligations and duties under the Administrative Services Agreement. The
Administrative Services Agreement was most recently approved by the Portfolio's
Board of Trustees on May 3, 1996.
For its services under the Administrative Services Agreement, SFG receives
a fee accrued daily and paid monthly of 0.05% of the assets of the Portfolio.
For the fiscal years ended August 31, 1994, August 31, 1995 and August 31, 1996,
the fees payable to SFG under the Administrative Services Agreement were
$602,105, $1,365,951 and $2,046,838, respectively (all of which were voluntarily
waived).
The Administrative Services Agreement provides that SFG may render
administrative services to others.
SFG is a wholly-owned subsidiary of Signature Financial Group, Inc.
Pursuant to a sub-administrative services agreement, Citibank performs
such sub-administrative duties for the Portfolio as are from time to time agreed
upon by Citibank and SFG. Citibank's sub-administrative duties may include
providing equipment and clerical personnel necessary for maintaining the
organization of the Portfolio, participation in the preparation of documents
required for compliance by the Portfolio with applicable laws and regulations,
preparation of certain documents in connection with meetings of Trustees and
investors in the Portfolio, and other functions which would otherwise be
performed by SFG as set forth above. For performing such sub-administrative
services, Citibank receives such compensation as is from time to time agreed
upon by SFG and Citibank not in excess of the amount paid to SFG for its
services under the Administrative Services Agreement discussed above (i.e., not
more than 0.05% per annum of the average daily net assets of the Portfolio). All
such compensation is paid by SFG.
The Portfolio has entered into a Transfer Agency Agreement and a Custodian
Agreement with State Street Bank and Trust Company ("State Street") pursuant to
which State Street acts as custodian and State Street Canada acts as transfer
agent and provides fund accounting services for the Portfolio. The principal
business address of State Street is 225 Franklin Street, Boston, Massachusetts
and the principal business address of State Street Canada is 40 King Street
West, Suite 5700, Toronto, Ontario, Canada.
Price Waterhouse are the independent certified public accountants for the
Portfolio, providing audit services, and assistance and consultation with
respect to the preparation of filings with the Securities and Exchange
Commission. The principal business address of Price Waterhouse is Suite 3000,
Box 190, 1 First Canadian Place, Toronto, Ontario M5X 1H7.
Item 17. Brokerage Allocation and Other Practices.
The Portfolio's purchases and sales of securities usually are principal
transactions. Securities are normally purchased directly from the issuer or from
an underwriter or market maker for the securities. There usually are no
brokerage commissions paid for such purchases. The Portfolio does not anticipate
paying brokerage commissions. Any transaction for which the Portfolio pays a
brokerage commission will be effected at the best price and execution available.
Purchases from underwriters of securities include a commission or concession
paid by the issuer to the underwriter, and purchases from dealers serving as
market makers include the spread between the bid and asked price.
Allocation of transactions, including their frequency, to various dealers
is determined by the Adviser in its best judgment and in a manner deemed to be
in the best interest of the investors in the Portfolio rather than by any
formula. The primary consideration is prompt execution of orders in an effective
manner at the most favorable price.
Investment decisions for the Portfolio are made independently from those
for any other account or investment company that is or may in the future become
managed by the Adviser or its affiliates. If, however, the Portfolio and other
investment companies or accounts managed by the Adviser are contemporaneously
engaged in the purchase or sale of the same security, the transactions may be
averaged as to price and allocated equitably to each account. In some cases,
this policy might adversely affect the price paid or received by the Portfolio
or the size of the position obtainable for the Portfolio. In addition, when
purchases or sales of the same security for the Portfolio and for other
investment companies or accounts managed by the Adviser occur contemporaneously,
the purchase or sale orders may be aggregated in order to obtain any price
advantages available to large denomination purchases or sales.
No transactions are executed with the Adviser or an affiliate of the
Adviser, in any case acting either as principal or as broker.
Item 18. Capital Stock and Other Securities.
Under the Declaration of Trust, the Trustees are authorized to issue
beneficial interests in the Portfolio. Investors are entitled to participate pro
rata in distributions of taxable income, loss, gain and credit of the Portfolio.
Upon liquidation or dissolution of the Portfolio, investors are entitled to
share pro rata in the Portfolio's net assets available for distribution to its
investors. Investments in the Portfolio have no preference, pre-emptive,
conversion or similar rights and are fully paid and non-assessable, except as
set forth below. Investments in the Portfolio may not be transferred.
Certificates representing an investor's beneficial interest in the Portfolio are
issued only upon the written request of an investor.
Each investor is entitled to a vote in proportion to the value of its
investment in the Portfolio. Investors in the Portfolio do not have cumulative
voting rights, and investors holding more than 50% of the aggregate beneficial
interest in the Portfolio may elect all of the Trustees of the Portfolio if they
choose to do so and in such event the other investors in the Portfolio would not
be able to elect any Trustee. The Portfolio is not required and has no current
intention to hold annual meetings of investors but the Portfolio will hold
special meetings of investors when in the judgment of the Portfolio's Trustees
it is necessary or desirable to submit matters for an investor vote. No material
amendment may be made to the Portfolio's Declaration of Trust without the vote
of a majority of the Portfolio's outstanding voting securities.
The Portfolio may enter into a merger or consolidation, or sell all or
substantially all of its assets, if approved by a vote of two-thirds of the
Portfolio's outstanding voting securities. The Portfolio may also be terminated
(i) by a vote of two-thirds of the Portfolio's outstanding voting securities or
(ii) by the Trustees of the Portfolio by written notice to the holders of the
Portfolio's outstanding voting securities.
The Portfolio is organized as a trust under the laws of the State of New
York. Investors in the Portfolio are personally liable for its obligations and
liabilities, subject, however, to indemnification by the Portfolio in the event
that there is imposed upon an investor a greater portion of the liabilities and
obligations of the Portfolio than its proportionate beneficial interest in the
Portfolio. The Declaration of Trust also provides that the Portfolio shall
maintain appropriate insurance (for example, fidelity bonding and errors and
omissions insurance) for the protection of the Portfolio, its investors,
Trustees, officers, employees and agents covering possible tort and other
liabilities. Thus, the risk of an investor incurring financial loss on account
of investor liability is limited to circumstances in which both inadequate
insurance existed and the Portfolio itself was unable to meet its obligations.
It is not expected that the liabilities of the Portfolio would ever exceed its
assets.
The Portfolio's Declaration of Trust further provides that obligations of
the Portfolio are not binding upon the Trustees individually, but only upon the
property of the Portfolio and that the Trustees will not be liable for any
action or failure to act, but nothing in the Declaration of Trust protects a
Trustee against any liability to which he would otherwise be subject by reason
of willful misfeasance, bad faith, gross negligence, or reckless disregard of
the duties involved in the conduct of his office.
Each investor in the Portfolio may add to or reduce its investment in the
Portfolio on each business day. At 3:00 p.m., Eastern time, on each such
business day, the value of each investor's interest in the Portfolio is
determined by multiplying the net asset value of the Portfolio by the percentage
representing that investor's share of the aggregate beneficial interests in the
Portfolio effective for that day. Any additions or withdrawals, which are to be
effected on that day, are then effected. The investor's percentage of the
aggregate beneficial interests in the Portfolio is then re-computed as the
percentage equal to the fraction (i) the numerator of which is the value of such
investor's investment in the Portfolio as of 3:00 p.m., Eastern time, on such
day plus or minus, as the case may be, the amount of any additions to or
withdrawals from the investor's investment in the Portfolio effected on such
day, and (ii) the denominator of which is the aggregate net asset value of the
Portfolio 3:00 p.m., Eastern time, on such day plus or minus, as the case may
be, the amount of the net additions to or withdrawals from the aggregate
investments in the Portfolio by all investors in the Portfolio. The percentage
so determined is then applied to determine the value of the investor's interest
in the Portfolio as of 3:00 p.m., Eastern time, on the following business day of
the Portfolio.
Item 19. Purchase, Redemption and Pricing of Securities.
Beneficial interests in the Portfolio are issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the Securities Act of 1933, as amended (the "1933
Act"). Investments in the Portfolio may only be made by investment companies,
insurance company separate accounts, common or commingled trust funds or similar
organizations or entities which are "accredited investors" within the meaning of
Regulation D under the 1933 Act. This registration statement does not constitute
an offer to sell, or the solicitation of an offer to buy, any "security" within
the meaning of the 1933 Act.
The Portfolio determines its net asset value as of 3:00 p.m., Eastern
time, on each day on which the New York Stock Exchange is open for trading. As
of the date of this Registration Statement, the New York Stock Exchange will be
open for trading every weekday except for the following holidays (or the days on
which they are observed): New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. Purchases
and withdrawals will be effected at the time of determination of net asset value
next following the receipt of any purchase or withdrawal order.
The securities held by the Portfolio are valued at their amortized cost.
Amortized cost valuation involves valuing an instrument at its cost and
thereafter assuming a constant amortization to maturity of any discount or
premium. If fluctuating interest rates or other factors cause the market value
of the securities held by the Portfolio to deviate more than 1/2 of 1% from
their value determined on the basis of amortized cost, the Portfolio's Board of
Trustees will consider whether any action should be initiated, as described in
the following paragraph. Although the amortized cost method provides certainty
in valuation, it may result in periods during which the stated value of an
instrument is higher or lower than the price an investment company would receive
if the instrument were sold.
Pursuant to the rules of the Securities and Exchange Commission, the
Portfolio's Board of Trustees has established procedures to stabilize the value
of the Portfolio's net assets within 1/2 of 1% of the value determined on the
basis of amortized cost. These procedures include a review of the extent of any
such deviation of net asset value, based on available market quotations. Should
that deviation exceed 1/2 of 1%, the Portfolio's Board of Trustees will consider
whether any action should be initiated to eliminate or reduce material dilution
or other unfair results to the investors in the Portfolio. Such action may
include withdrawal in kind, selling securities prior to maturity and utilizing a
net asset value as determined by using available market quotations. The
Portfolio maintains a dollar-weighted average maturity of 90 days or less, does
not purchase any instrument with a remaining maturity greater than 397 days or
subject to a repurchase agreement having a duration of greater than 397 days,
limits its investments, including repurchase agreements, to those U.S.
dollar-denominated instruments that have been determined by the Adviser to
present minimal credit risk and comply with certain reporting and recordkeeping
procedures. The Portfolio has also established procedures to ensure that
securities purchased by it meet its high quality criteria. See "Investment
Objective and Policies."
Subject to compliance with applicable regulations, the Portfolio has
reserved the right to pay the redemption price of beneficial interests in the
Portfolio, either totally or partially, by a distribution in kind of readily
marketable securities (instead of cash). The securities so distributed would be
valued at the same amount as that assigned to them in calculating the net asset
value for the beneficial interests being redeemed. If a holder of beneficial
interests received a distribution in kind, such holder could incur brokerage or
other charges in converting the securities to cash.
The Portfolio may suspend the right of redemption or postpone the date of
payment for beneficial interests in the Portfolio more than seven days during
any period when (a) trading in the markets the Portfolio normally utilizes is
restricted, or an emergency, as defined by the rules and regulations of the
Securities and Exchange Commission exists making disposal of the Portfolio's
investments or determination of its net asset value not reasonably practicable;
(b) the New York Stock Exchange is closed (other than customary weekend and
holiday closings); or (c) the Securities and Exchange Commission has by order
permitted such suspension.
Item 20. Tax Status.
The Portfolio is organized as a trust under New York law. The Portfolio
has determined, on the basis of a ruling of the Internal Revenue Service, that
it is properly treated as a partnership for federal income tax purposes.
Accordingly, the Portfolio is not subject to any federal income tax, but each
investor in the Portfolio must take into account its share of the Portfolio's
ordinary income, expenses, capital gains or losses, credits and other items in
determining its income tax liability. The determination of such share is made in
accordance with the governing instruments of the Portfolio and the Internal
Revenue Code of 1986, as amended (the "Code"), and regulations promulgated
thereunder.
The Portfolio's tax year-end is August 31. Although, as described above,
the Portfolio is not subject to federal income tax, it files appropriate federal
income tax returns.
The Portfolio believes that, in the case of an investor in the Portfolio
that seeks to qualify as a regulated investment company ("RIC") under the Code,
the investor should be treated for federal income tax purposes as an owner of an
undivided interest in the assets and operations of the Portfolio, and
accordingly should be deemed to own a proportionate share of each of the assets
of the Portfolio and should be entitled to treat as earned by it the portion of
the Portfolio's gross income attributable to that share. The Portfolio also
believes that each such investor should be deemed to hold its proportionate
share of the Portfolio's assets for the period the Portfolio has held the assets
or for the period the investor has been a partner in the Portfolio, whichever is
shorter. Each such investor should consult its tax advisers regarding whether,
in light of its particular tax status and any special tax rules applicable to
it, this approach applies to its investment in the Portfolio, or whether the
Portfolio should be treated, as to it, as a separate entity as to which the
investor has no direct interest in Portfolio assets or operations.
In order to enable an investor in the Portfolio that is otherwise eligible
to qualify as a RIC under the Code to so qualify, the Portfolio intends to
satisfy the requirements of Subchapter M of the Code relating to the nature of
the Portfolio's gross income and the composition (diversification) and holding
period of the Portfolio's assets as if those requirements were directly
applicable to the Portfolio, and to allocate and permit withdrawals of its net
investment income and any net realized capital gains in a manner that will
enable an investor that is a RIC to comply with the qualification requirements
imposed by Subchapter M of the Code.
The Portfolio will allocate at least annually among its investors each
investor's distributive share of the Portfolio's net investment income
(including net investment income derived from interest on U.S. Treasury
obligations), net realized capital gains, and any other items of income, gain,
loss, deduction, or credit in a manner intended to comply with the Code and
applicable Treasury regulations.
To the extent the cash proceeds of any withdrawal or distribution exceed
an investor's adjusted tax basis in its partnership interest in the Portfolio,
the investor will generally recognize gain for federal income tax purposes. If,
upon a complete withdrawal (i.e., a redemption of its entire interest in the
Portfolio), the investor's adjusted tax basis in its partnership interest in the
Portfolio exceeds the proceeds of the withdrawal, the investor will generally
recognize a loss for federal income tax purposes. An investor's adjusted tax
basis in its partnership interest in the Portfolio will generally be the
aggregate price paid therefor, increased by the amounts of its distributive
share of items of realized net income (including income, if any, exempt from
Federal income tax) and gain, and reduced, but not below zero, by the amounts of
its distributive share of items of realized net loss and the amounts of any
distributions received by the investor.
Portfolio income allocated to investors that is derived from interest on
obligations of the U.S. Government and certain of its agencies and
instrumentalities (but generally not from capital gains realized upon the
disposition of such obligations) may be exempt from state and local taxes. The
Portfolio intends to advise investors of the extent, if any, to which its income
consists of such interest. Investors are urged to consult their tax advisers
regarding the possible exclusion of such portion of the income allocated to them
by the Portfolio for state and local income tax purposes.
There are certain tax issues which will be relevant to only certain of the
Portfolio's investors, specifically, investors which are segregated asset
accounts and investors who contribute assets other than cash to the Portfolio.
It is intended that such segregated asset accounts will be able to satisfy
diversification requirements applicable to them and that such contributions of
assets will not be taxable provided certain requirements are met.
The above discussion does not address the special tax rules applicable to
certain classes of investors, such as tax-exempt entities, insurance companies,
and financial institutions, or the state, local, or non-United States tax laws
that may be applicable to certain investors. Investors should consult their own
tax advisers with respect to the special tax rules that may apply in their
particular situations, as well as the state, local, or foreign tax consequences
to them of investing in the Portfolio.
Item 21. Underwriters.
The exclusive placement agent for the Portfolio is The Landmark Funds
Broker-Dealer Services, Inc., which receives no compensation for serving in this
capacity. Investment companies, insurance company separate accounts, common and
commingled trust funds and similar organizations and entities may continuously
invest in the Portfolio.
Item 22. Calculations of Performance Data.
Not applicable.
Item 23. Financial Statements.
The financial statements contained in the Annual Report of the Portfolio,
as filed with the Securities and Exchange Commission on October 29, 1996
(Accession Number 0000950156-96-000851), for the fiscal year ended August 31,
1996 are incorporated by reference into this Statement of Additional
Information.
A copy of the Annual Report of the Portfolio accompanies this Statement of
Additional Information.
<PAGE>
PART C
Item 24. Financial Statements and Exhibits.
(a) FINANCIAL STATEMENTS INCLUDED IN PART A:
Not applicable.
FINANCIAL STATEMENTS INCLUDED IN PART B:
Portfolio of Investments at August 31, 1996*
Statement of Assets and Liabilities at August 31, 1996*
Statement of Operations for the year ended August 31, 1996*
Statement of Changes in Net Assets for the years ended August 31, 1996
and August 31, 1995*
Financial Highlights for each of the years in the five-year period
ended August 31, 1996*
Notes to Financial Statements - August 31, 1996*
Independent Auditors' Report - October 9, 1996*
- ---------------
* Incorporated herein by reference to the Annual Report of the Registrant for
the fiscal year ended August 31, 1996, filed with the Securities and Exchange
Commission on the EDGAR system on October 29, 1996 (Accession Number
0000950156-96-000851).
(b) EXHIBITS:
1(a) Amended and Restated Declaration of Trust of the
Registrant
* 1(b) Amendments to the Declaration of Trust of the
and filed herewith Registrant
2 By-laws of the Registrant
5 Investment Advisory Agreement between the Registrant
and Citibank, N.A., as investment adviser
6 Placement Agency Agreement between the Registrant and
The Landmark Funds Broker-Dealer Services, Inc., as
exclusive placement agent
7 Custodian Contract between the Registrant and State
Street Bank and Trust Company, as custodian
9(a) Transfer Agency and Service Agreement between the
Registrant and State Street Bank and Trust Company, as
transfer agent
9(b) Amended and Restated Administrative Services Plan of
the Registrant
9(c) Administrative Service Agreement between the
Registrant and Signature Financial Group (Cayman),
Ltd., as administrator
9(d) Sub-Administrative Services Agreement between
Signature Financial Group (Cayman), Ltd., and
Citibank, N.A.
11 Consent of Price Waterhouse, independent auditors of
the Registrant
27 Financial Data Schedule
- -------------------------------------------------------------
* Incorporated herein by reference to Registrant's Registration Statement on
Form N-1A (File No. 811-05813) as filed with the Securities and Exchange
Commission on December 28, 1995.
Item 25. Persons Controlled by or under Common Control with Registrant.
Not applicable.
Item 26. Number of Holders of Securities.
(1) (2)
Title of Class Number of Record Holders
(as of December 27, 1996)
Beneficial Interests 8
Item 27. Indemnification.
Reference is hereby made to Article V of the Registrant's Declaration of
Trust, filed as an Exhibit to its Registration Statement on Form N-1A.
The Trustees and officers of the Registrant and the personnel of the
Registrant's administrator are insured under an errors and omissions liability
insurance policy. The Registrant and its officers are also insured under the
fidelity bond required by Rule 17g-1 under the Investment Company Act of 1940.
Item 28. Business and Other Connections of Investment Adviser.
Citibank, N.A. ("Citibank") is a commercial bank offering a wide range of
banking and investment services to customers across the United States and around
the world. Citibank is a wholly-owned subsidiary of Citicorp, a registered bank
holding company. Citibank also serves as investment adviser to the following
registered investment companies (or series thereof): The Premium Portfolios
(Balanced Portfolio, Equity Portfolio, Government Income Portfolio,
International Equity Portfolio, Emerging Asian Markets Equity Portfolio and
Small Cap Equity Portfolio), U.S. Treasury Reserves Portfolio, Tax Free Reserves
Portfolio, Asset Allocation Portfolios (Asset Allocation Portfolio 200, Asset
Allocation Portfolio 300, Asset Allocation Portfolio 400 and Asset Allocation
Portfolio 500), Landmark Multi-State Tax Free Funds (Landmark New York Tax Free
Reserves, Landmark Connecticut Tax Free Reserves and Landmark California Tax
Free Reserves), Landmark Fixed Income Funds (Landmark Intermediate Income Fund),
Landmark Tax Free Income Funds (Landmark National Tax Free Income Fund and
Landmark New York Tax Free Income Fund), Landmark VIP Funds (Landmark VIP U.S.
Government Portfolio, Landmark VIP Balanced Portfolio, Landmark VIP Equity
Portfolio and Landmark VIP International Equity Portfolio), and Variable Annuity
Portfolios (CitiSelectSM VIP Folio 200, CitiSelectSM VIP Folio 300, CitiSelectSM
VIP Folio 400, CitiSelectSM VIP Folio 500 and Landmark Small Cap Equity VIP
Fund). As of December 31, 1995, Citibank and its affiliates managed assets in
excess of $83 billion worldwide. The principal place of business of Citibank is
located at 399 Park Avenue, New York, New York 10043.
The Chairman of the Board and a Director of Citibank is John S. Reed.
The following are Vice Chairmen of the Board and Directors of Citibank: Paul
J. Collins, William R. Rhodes and H. Onno Ruding. Other Directors of
Citibank are D. Wayne Calloway, Chairman and Chief Executive Officer,
PepsiCo, Inc., Purchase, New York; Colby H. Chandler, Former Chairman and
Chief Executive Officer, Eastman Kodak Company; Kenneth T. Derr, Chairman and
Chief Executive Officer, Chevron Corporation; H.J. Haynes, Senior Counselor,
Bechtel Group, Inc., San Francisco, California; Rozanne L. Ridgway,
President, The Atlantic Council of the United States; Robert B. Shapiro,
President and Chief Operating Officer, Monsanto Company; Frank A. Shrontz,
Chairman and Chief Executive Officer, The Boeing Company, Seattle,
Washington; Roger B. Smith, Former Chairman and Chief Executive Officer,
General Motors Corporation; Franklin A. Thomas, President, The Ford
Foundation, New York, New York; and Edgar S. Woolard, Jr., Chairman and Chief
Executive Officer, E.I. DuPont De Nemours & Company.
Each of the individuals named above is also a Director of Citicorp. In
addition, the following persons have the affiliations indicated:
D. Wayne Calloway Director, Exxon Corporation
Director, General Electric Company
Director, Pepsico, Inc.
Colby H. Chandler Director, Digital Equipment Corporation
Director, Ford Motor Company
Director, J.C. Penney Company, Inc.
Paul J. Collins Director, Kimberly-Clark Corporation
Kenneth T. Derr Director, American Telephone and Telegraph, Co.
Director, Chevron Corporation
Director, Potlatch Corporation
H.J. Haynes Director, Bechtel Group, Inc.
Director, Boeing Company
Director, Fremont Group, Inc.
Director, Hewlett-Packard Company
Director, Paccar Inc.
Director, Saudi Arabian Oil Company
John S. Reed Director, Monsanto Company
Director, Philip Morris Companies
Incorporated
Stockholder, Tampa Tank & Welding, Inc.
William R. Rhodes Director, Private Export Funding
Corporation
Rozanne L. Ridgway Director, 3M
Director, Bell Atlantic Corporation
Director, Boeing Company
Director, Emerson Electric Company
Member-International Advisory Board,
New Perspective Fund, Inc.
Director, RJR Nabisco, Inc.
Director, Sara Lee Corporation
Director, Union Carbide Corporation
H. Onno Ruding Member, Board of Supervisory Directors,
Amsterdam Trustee's Kantoor
Board Member, Corning, Incorporated
Advisor, Intercena (C&A) (Netherlands)
Member, Board of Supervisory Directors,
Pechiney Nederland N.V.
Member, Board of Advisers, Robeco N.V.
Advisory Director, Unilever N.V.
Advisory Director, Unilever PLC
Robert B. Shapiro Director, G.D. Searle & Co.
Director, Silicon Graphics
Director, Monsanto Company
Director, The Nutrasweet Company
Frank A. Shrontz Director, 3M
Director, Baseball of Seattle, Inc.
Director, Boeing Company
Director, Boise Cascade Corp.
Roger B. Smith Director, International Paper Company
Director, Johnson & Johnson
Director, Pepsico, Inc.
Franklin A. Thomas Director, Aluminum Company of America
Director, American Telephone and Telegraph, Co.
Director, Cummins Engine Company, Inc.
Director, Pepsico, Inc.
Edgar S. Woolard, Jr. Director, E.I. DuPont De Nemours &
Company
Item 29. Principal Underwriters.
(a) The Landmark Funds Broker-Dealer Services, Inc. ("LFBDS"), the
Registrant's Distributor, is also the distributor for Landmark International
Equity Fund, Landmark Emerging Asian Markets Equity Fund, Landmark U.S. Treasury
Reserves, Landmark Cash Reserves, Premium U.S. Treasury Reserves, Premium Liquid
Reserves, Landmark Institutional U.S. Treasury Reserves, Landmark Institutional
Liquid Reserves, Landmark Institutional Tax Free Reserves, Landmark Tax Free
Reserves, Landmark California Tax Free Reserves, Landmark Connecticut Tax Free
Reserves, Landmark New York Tax Free Reserves, Landmark U.S. Government Income
Fund, Landmark Intermediate Income Fund, Landmark Balanced Fund, CitiSelectSM
Folio 200, CitiSelectSM Folio 300, CitiSelectSM Folio 400, CitiSelectSM Folio
500, Landmark Equity Fund, Landmark Small Cap Equity Fund, Landmark National Tax
Free Income Fund, Landmark New York Tax Free Income Fund, Landmark VIP Funds
(Landmark VIP U.S. Government Portfolio, Landmark VIP Balanced Portfolio,
Landmark VIP Equity Portfolio and Landmark VIP International Equity Portfolio),
and Variable Annuity Portfolios (CitiSelectSM VIP Folio 200, CitiSelectSM VIP
Folio 300, CitiSelectSM VIP Folio 400, CitiSelectSM VIP Folio 500 and Landmark
Small Cap Equity VIP Fund). LFBDS is also the placement agent for International
Equity Portfolio, Balanced Portfolio, Equity Portfolio, Small Cap Equity
Portfolio, Government Income Portfolio, Emerging Asian Markets Equity Portfolio,
Tax Free Reserves Portfolio, Asset Allocation Portfolio 200, Asset Allocation
Portfolio 300, Asset Allocation Portfolio 400, Asset Allocation Portfolio 500
and U.S. Treasury Reserves Portfolio.
(b) The information required by this Item 29 with respect to each director
and officer of LFBDS is incorporated by reference to Schedule A of Form BD filed
by LFBDS pursuant to the Securities and Exchange Act of 1934 (File No. 8-32417).
(c) Not applicable.
Item 30. Location of Accounts and Records.
The accounts and records of the Registrant are located, in whole or in
part, at the office of the Registrant and the following locations:
NAME ADDRESS
- ---- -------
Signature Financial Group (Cayman), Elizabethan Square
Ltd. George Town
(administrator) Grand Cayman, Cayman Island, BWI
The Landmark Funds Broker-Dealer 6 St. James Avenue
Services, Inc. Boston, MA 02116
(exclusive placement agent)
State Street Canada, Inc. 40 King Street West
(transfer agent) Ontario, Canada
State Street Bank and Trust company 225 Franklin Street
(custodian) Boston, MA 02110
Citibank, N.A. 153 East 53rd Street
(investment adviser) New York, NY 10043
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
Not applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to its Registration Statement on Form
N-1A to be signed on its behalf by the undersigned, thereto duly authorized, in
George Town, Grand Cayman, Cayman Islands, BWI, on the 27th day of December,
1996.
CASH RESERVES PORTFOLIO
By: Susan Jakuboski
Susan Jakuboski,
Assistant Treasurer
<PAGE>
EXHIBIT INDEX
Exhibit
No.: Description:
1(a) Amended and Restated Declaration of Trust of the
Registrant
1(b) Amendments to the Declaration of Trust of the
Registrant
2 By-laws of the Registrant
5 Investment Advisory Agreement between the Registrant
and Citibank, N.A., as investment adviser
6 Placement Agency Agreement between the Registrant and
The Landmark Funds Broker-Dealer Services, Inc., as
exclusive placement agent
7 Custodian Contract between the Registrant and State
Street Bank and Trust Company, as custodian
9(a) Transfer Agency and Service Agreement between the
Registrant and State Street Bank and Trust Company, as
transfer agent
9(b) Amended and Restated Administrative Services Plan of
the Registrant
9(c) Administrative Service Agreement between the
Registrant and Signature Financial Group (Cayman),
Ltd., as administrator
9(d) Sub-Administrative Services Agreement between
Signature Financial Group (Cayman), Ltd., and
Citibank, N.A.
11 Consent of Price Waterhouse, independent auditors of
the Registrant
27 Financial Data Schedule
<PAGE>
EXHIBIT NO. 1(a)
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
CASH RESERVES PORTFOLIO
This is an AMENDED AND RESTATED DECLARATION OF TRUST of the original
Declaration of Trust of the Cash Reserves Portfolio is made this 23rd day of
May, 1989 and amended and restated this 13th day of December, 1989 by the
parties signatory hereto, as trustees (such persons, so long as they shall
continue in office in accordance with the terms of this Declaration of Trust,
and all other persons who at the time in question have been duly elected or
appointed as trustees in accordance with the provisions of this Declaration of
Trust and are then in office, being hereinafter called the "Trustees").
WITNESSETH
WHEREAS, the Trustees desire to form a trust fund under the law of New York
for the investment and reinvestment of its assets; and
WHEREAS, it is proposed that the trust assets be composed of funds
contributed thereto by the holders of interests in the trust entitled to
ownership rights in the trust;
NOW, THEREFORE, the Trustees hereby declare that they will hold in trust
all money and property contributed to the trust fund to manage and dispose of
the same for the benefit of the holders of interests in the Trust and subject to
the provisions hereof, to wit:
ARTICLE I
The Trust
Trust 1.1. Name. The name of the trust created hereby (the Trust") shall be
"Cash Reserves Portfolio", and so far as may be practicable the Trustees shall
conduct the Trust's activities, execute all documents and sue or be sued under
that name, which name (and the word "Trust" wherever hereinafter used) shall
refer to the Trustees as Trustees, and not individually, and shall not refer to
the officers, agents, employees or holders of interests in the Trust. However,
should the Trustees determine that the use of the name of the Trust is not
advisable, they may select such other name for the Trust as they deem proper and
the Trust may hold its property and conduct its activities under such other
name. Any name change shall become effective upon the execution by a majority of
the then Trustees of an instrument setting forth the new name. Any such
instrument shall have the status of an amendment to this Declaration.
1.2. Definitions. As used in this Declaration, the following terms shall
have the following meanings:
The terms "Affiliated Person", "Assignment", "Commission", "Interested
Person" shall have the meanings given them in the 1940 Act, as amended from time
to time.
"Administrator" shall mean any party furnishing services to the Trust
pursuant to any administrative services contract described in Section 4.1
hereof.
"Book Capital Account" shall mean, for any Holder at any time, the Book
Capital Account of the Holder for such day, determined in accordance with
generally accepted accounting principles and the provisions of the 1940 Act.
"Commission" shall mean the Securities and Exchange Commission.
"Declaration" shall mean this Declaration of Trust as amended from time to
time. References in this Declaration to "Declaration", "hereof", "herein" and
"hereunder" shall be deemed to refer to the Declaration rather than the article
or section in which such words appear.
"Fiscal Year" shall mean an annual period as determined by the Trustees.
"Holders" shall mean as of any particular time all holders of record of
Interests of the Trust at such time.
"Institutional Investor(s)" shall mean the following:
(i) Regulated investment companies for which
(x) Citibank, N.A. and/or one or more of its affiliates acts as the
exclusive shareholder servicing agent(s) and shares of the regulated investment
companies are offered exclusively to customers of Citibank, N.A. and/or its
affiliates, or
(y) Citibank, N.A. and/or one or more of its affiliates acts or,
but for the Trust agreement, would act as the exclusive investment adviser for
the regulated investment companies;
(ii) Section 501(a) group trusts for which Citibank, N.A. and/or one
or more of its affiliates acts as a fiduciary;
(iii) Section 584 common trust funds maintained by Citibank, N.A. or
an affiliate that is a bank; and,
(iv) Any similar collective investment arrangement for which Citibank,
N.A. and/or one of its affiliates acts in a capacity similar to any of those
described in clause (i) - (iii) above.
"Interest(s)" shall mean the interest of a Holder in the Trust, including
all rights, powers and privileges accorded to Holders in this Declaration, which
interest may be expressed as a percentage, determined by calculating, at such
times and on such basis, as the Trustees shall from time to time determine, the
ratio of each Holders' Book Capital Account balance to the total of all Holders'
Book Capital Account balances. Reference herein to a specified percentage in, or
fraction of, Interests of the Holders, means Holders whose combined Book Capital
Accounts represent such specified percentage or fraction of the Book Capital
Accounts of all Holders.
"Investment Adviser" shall mean any party furnishing services to the Trust
pursuant to any investment advisory contract described in Section 4.1 hereof.
"Majority Interests Vote" shall mean the vote, at a meeting of the Holders
of the Trust, of (A) 67% or more of the Interests present or represented at such
meeting, if the Holders of more than 50% of the Interests of the Trust are
present or represented by proxy or (B) more than 50% of the Interests of the
Trust, whichever is less.
"Person" shall mean and include the individuals, corporations,
partnerships, trusts, associations, joint ventures and other entities, whether
or not legal entities, and governments and agencies and political subdivisions
thereof.
"Registration Statement" shall mean the currently effective Registration
Statement of the Trust under the 1940 Act.
"Trustees" shall mean the signatories to this Declaration, so long as they
shall continue in office in accordance with the terms hereof, and all other
persons who at the time in question have been duly elected or appointed and have
qualified as trustees in accordance with the provisions hereof and are then in
office, who are herein referred to as the "Trustees", and reference in this
Declaration of Trust to a Trustee or Trustees shall refer to such person or
persons in their capacity as trustees hereunder.
"Trust Property" shall mean as of any particular time any and all property,
real or personal, tangible or intangible, which at such time is owned or held by
or for the account of the Trust or the Trustees.
The "1940 Act" refers to the Investment Company Act of 1940, as amended
from time to time, and the rules and regulations thereunder.
ARTICLE II
Trustees
2.1. Number and Qualification. The number of Trustees shall be fixed from
time to time by written instrument signed by a majority of the Trustees so fixed
then in office, provided, however, that the number of Trustees shall in no event
be less than three or more than fifteen. Any vacancy created by an increase in
Trustees may be filled by the appointment of an individual having the
qualifications described in this Article made by a written instrument signed by
a majority of the Trustees then in office. Any such appointment shall not become
effective, however, until the individual named in the written instrument of
appointment shall have accepted in writing such appointment and agreed in
writing to be bound by the terms of this Declaration. No reduction in the number
of Trustees shall have the effect of removing any Trustee from office. Whenever
a vacancy in the number of Trustees shall occur, until such vacancy is filled as
provided in Section 2.4 hereof, the Trustees in office, regardless of their
number, shall have all the powers granted to the Trustees and shall discharge
all the duties imposed upon the Trustees by this Declaration. A Trustee shall be
an individual at least 21 years of age who is not under legal disability.
2.2. Term and Election. Each Trustee named herein, or elected or appointed
prior to the first meeting of Holders, shall (except in the event of
resignations, retirements or removals or vacancies pursuant to Section 2.3 or
2.4 hereof) hold office until his successor has been elected at such meeting and
has qualified to serve as Trustee, as required under the 1940 Act. Subject to
the provisions of Section 16(a) of the 1940 Act and except as provided in
Section 2.3 and Section 2.4 hereof, each Trustee shall hold office during the
lifetime of this Trust and until its termination as hereinafter provided.
2.3. Resignation, Removal and Retirement. Any Trustee may resign his trust
(without need for prior or subsequent accounting) by an instrument in writing
signed by him and delivered or mailed to the Chairman, if any, the President or
the Secretary and such resignation shall be effective upon such delivery, or at
a later date according to the terms of the instrument. Any of the Trustees may
be removed by the affirmative vote of the holders of two-thirds (2/3) of the
Interests or (provided the aggregate number of Trustees, after such removal and
after giving effect to any appointment made to fill the vacancy created by such
removal, shall not be less than the number required by Section 2.1 hereof) with
cause, by the action of two-thirds of the remaining Trustees. Removal with cause
includes, but is not limited to, the removal of a Trustee due to physical or
mental incapacity and failure to comply with such written policies as may from
time to time be adopted by at least two-thirds of the Trustees with respect to
the conduct of the Trustees and attendance at meetings. Any Trustee who has
attained a mandatory retirement age established pursuant to any written policy
adopted from time to time by at least two-thirds of the Trustees shall,
automatically and without action of such Trustee or the remaining Trustees, be
deemed to have retired in accordance with the terms of such policy, effective as
of the date determined in accordance with such policy. Any Trustee who has
become incapacitated by illness or injury as determined by a majority of the
other Trustees, may be retired by written instrument signed by a majority of the
other Trustees, specifying the date of his retirement. Upon the resignation,
retirement or removal of a Trustee, or his otherwise ceasing to be a Trustee, he
shall execute and deliver such documents as the remaining Trustees shall require
for the purpose of conveying to the Trust or the remaining Trustees any Trust
Property held in the name of the resigning, retiring or removed Trustee. Upon
the death of any Trustee or upon removal or resignation due to any Trustee's
incapacity to serve as trustee, his legal representative shall execute and
deliver on his behalf such documents as the remaining Trustees shall require as
provided in the preceding sentence.
2.4. Vacancies. The term of office of a Trustee shall terminate and a
vacancy shall occur in the event of the death, resignation, adjudicated
incompetence or other incapacity to perform the duties of the office, retirement
or removal, of a Trustee. No such vacancy shall operate to annul this
Declaration or to revoke any existing agency created pursuant to the terms of
this Declaration. In the case of a vacancy, the Holders of at least a majority
of the Interests entitled to vote, acting at any meeting of Holders held in
accordance with Section 9.1 hereof, or, to the extent permitted by the 1940 Act,
a majority of the Trustees continuing in office acting by written instrument or
instruments, may fill such vacancy, and any Trustee so elected by the Trustees
or the Holders shall hold office as provided in this Declaration.
2.5. Meetinqs. Meetings of the Trustees shall be held from time to time
upon the call of the Chairman, if any, the President, the Secretary, an
Assistant Secretary or any two Trustees. Regular meetings of the Trustees may be
held without call or notice at a time and place fixed by the By-Laws or by
resolution of the Trustees. Notice of any other meeting shall be mailed or
otherwise given not less than 24 hours before the meeting but may be waived in
writing by any Trustee either before or after such meeting. The attendance of a
Trustee at a meeting shall constitute a waiver of notice of such meeting except
where a Trustee attends a meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting has not been lawfully
called or convened. The Trustees may act with or without a meeting. A quorum for
all meetings of the Trustees shall be a majority of the Trustees. Unless
provided otherwise in this Declaration, any action of the Trustees may be taken
at a meeting by vote of a majority of the Trustees present (a quorum being
present) or without a meeting by written consent of a majority of Trustees.
Any committee of the Trustees, including an executive committee, if any,
may act with or without a meeting. A quorum for all meetings of any such
committee shall be a majority of the members thereof. Unless provided otherwise
in this Declaration, any action of any such committee may be taken at a meeting
by vote of a majority of the members present (a quorum being present) or without
a meeting by written consent of a majority of the members.
With respect to actions of the Trustees and any committee of the Trustees,
Trustees who are Interested Persons of the Trust within the meaning of Section
1.2 hereof or otherwise interested in any action to be taken may be counted for
quorum purposes under this Section 2.5 and shall be entitled to vote to the
extent permitted by the 1940 Act.
All or any one or more Trustees may participate in a meeting of the
Trustees or any committee thereof by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other and participation in a meeting pursuant to such
communications system shall constitute presence in person at such meeting.
2.6. Officers; Chairman of the Board. The Trustees shall, from time to
time, elect a President, a Secretary and a Treasurer. The Trustees may elect or
appoint, from time to time, a Chairman of the Board who shall preside at all
meetings of the Trustees and carry out such other duties as the Trustees shall
designate. The Trustees may elect or appoint or authorize the President to
appoint such other officers or agents with such powers as the Trustees may deem
to be advisable. The President shall be and the Secretary and Treasurer may, but
need not, be a Trustee.
2.7. By-Laws. The Trustees may adopt and, from time to time, amend or
repeal the By-Laws for the conduct of the business of the Trust.
ARTICLE III
Powers of Trustees
3.1. General. The Trustees shall have exclusive and absolute control over
the Trust Property and over the business of the Trust to the same extent as if
the Trustees were the sole owners of the Trust Property and business in their
own right, but with such powers of delegation as may be permitted by this
Declaration. The Trustees may perform such acts as in their sole discretion are
proper for conducting the business of the Trust. The enumeration of any specific
power herein shall not be construed as limiting the aforesaid power. Such powers
of the Trustees may be exercised without order of or resort to any court.
3.2. Investments. The Trustees shall have power to:
(a) conduct, operate and carry on the business of an investment
company;
(b) subscribe for, invest in, reinvest in, purchase or otherwise
acquire, hold, pledge, sell, assign, transfer, exchange, distribute or
otherwise deal in or dispose of United States and foreign currencies and
related instruments including forward contracts, and securities, including
common and preferred stock, warrants, bonds, debentures, time notes and all
other evidences of indebtedness, negotiable or non-negotiable instruments,
obligations, certificates of deposit or indebtedness, commercial paper,
repurchase agreements, reverse repurchase agreements, convertible
securities, forward contracts, options, futures contracts, and other
securities, including, without limitation, those issued, guaranteed or
sponsored by any state, territory or possession of the United States and
the District of Columbia and their political subdivisions, agencies and
instrumentalities, or by the United States Government, any foreign
government, or any agency, instrumentality or political subdivision of the
United States Government or any foreign government, or international
instrumentalities, or by any bank, savings institution, corporation or
other business entity organized under the laws of the United States or
under foreign laws; and, to exercise any and all rights, powers and
privileges of ownership or interest in respect of any and all such
investments of every kind and description, including, without limitation,
the right to consent and otherwise act with respect thereto, with power to
designate one or more persons, firms, associations, or corporations to
exercise any of said rights, powers and privileges in respect of any of
said instruments; and the Trustees shall be deemed to have the foregoing
powers with respect to any additional securities in which the Trust may
invest.
The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust, nor shall the Trustees be limited
by any law limiting the investments which may be made by fiduciaries.
3.3. Legal Title. Legal title to all the Trust Property shall be vested in
the Trustees as joint tenants except that the Trustees shall have the power to
cause legal title to any Trust Property to be held by or in the name of one or
more of the Trustees, or in the name of the Trust, or in the name of any other
Person as nominee, on such terms as the Trustees may determine.
The right, title and interest of the Trustees in the Trust Property shall
vest automatically in each person who may hereafter become a Trustee upon his
due election and qualification. Upon the resignation, removal or death of a
Trustee he shall automatically cease to have any right, title or interest in any
of the Trust Property, and the right, title and interest of such Trustee in the
Trust Property shall vest automatically in the remaining Trustees. Such vesting
and cessation of title shall be effective whether or not conveyancing documents
have been executed and delivered.
3.4. Sale of Interests. Subject to the more detailed provisions set forth
in Articles VII and VIII, the Trustees shall have the power to permit persons to
purchase Interests and to add to or reduce, in whole or in part, their Interest
in the Trust.
3.5. Borrow Money. The Trustees shall have power to borrow money or
otherwise obtain credit and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the Trust, including the lending
of portfolio securities, and to endorse, guarantee, or undertake the performance
of any obligation, contract or engagement of any other person, firm, association
or corporation.
3.6. Delegation; Committees. The Trustees shall have power, consistent with
their continuing exclusive authority over the management of the Trust and the
Trust Property, to delegate from time to time to such of their number or to
officers, employees or agents of the Trust the doing of such things and the
execution of such instruments either in the name of the Trust or the names of
the Trustees or otherwise as the Trustees may deem expedient.
3.7. Collection and Payment. The Trustees shall have power to collect all
property due to the Trust; and to pay all claims, including taxes, against the
Trust Property; to prosecute, defend, compromise or abandon any claims relating
to the Trust Property; to foreclose any security interest securing any
obligations, by virtue of which any property is owed to the Trust; and to enter
into releases, agreements and other instruments.
3.8. Expenses. The Trustees shall have power to incur and pay any expenses
which in the opinion of the Trustees are necessary or incidental to carry out
any of the purposes of this Declaration, and to pay reasonable compensation from
the funds of the Trust to themselves as Trustees. The Trustees shall fix the
compensation of all officers, employees and Trustees. The Trustees may pay
themselves such compensation for special services, including legal and brokerage
services, as they in good faith may deem reasonable, and reimbursement for
expenses reasonably incurred by themselves on behalf of the Trust.
3.9. Miscellaneous Powers. The Trustees shall have the power to: (a) employ
or contract with such Persons as the Trustees may deem desirable for the
transaction of the business of the Trust and terminate such employees or
contractual relationships as they consider appropriate; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) purchase,
and pay for out of Trust Property, insurance policies insuring the Investment
Adviser, Administrator, placement agent, Holders, Trustees, officers, employees,
agents, or independent contractors of the Trust against all claims arising by
reason of holding any such position or by reason of any action taken or omitted
by any such Person in such capacity, whether or not the Trust would have the
power to indemnify such Person against such liability; (d) establish pension,
profit-sharing and other retirement, incentive and benefit plans for any
Trustees, officers, employees and agents of the Trust; (e) make donations,
irrespective of benefit to the Trust, for charitable, religious, educational,
scientific, civic or similar purposes; (f) to the extent permitted by law,
indemnify any Person with whom the Trust has dealings, including the Investment
Adviser, Administrator, placement agent, Holders, Trustees, officers, employees,
agents or independent contractors of the Trust, to such extent as the Trustees
shall determine; (g) guarantee indebtedness or contractual obligations of
others; (h) determine and change the Fiscal Year of the Trust and the method in
which its accounts shall be kept; and (i) adopt a seal for the Trust, but the
absence of such seal shall not impair the validity of any instrument executed on
behalf of the Trust.
3.10. Further Powers. The Trustees shall have power to conduct the business
of the Trust and carry on its operations in any and all of its branches and
maintain offices, whether within and without the State of New York, in any and
all states of the United States of America, in the District of Columbia, and in
any and all commonwealths, territories, dependencies, colonies, possessions,
agencies or instrumentalities of the United States of America and of foreign
governments, and to do all such other things and execute all such instruments as
they deem necessary, proper or desirable in order to promote the interests of
the Trust although such things are not herein specifically mentioned. Any
determination as to what is in the interests of the Trust made by the Trustees
in good faith shall be conclusive. In construing the provisions of this
Declaration, the presumption shall be in favor of a grant of power to the
Trustees. The Trustees will not be required to obtain any court order to deal
with Trust Property.
ARTICLE IV
Investment Advisory, Administrative Services and Placement
Agent Arrangements
4.1. Investment Advisory and Other Arrangements. The Trustees may in their
discretion, from time to time, enter into investment advisory and administrative
services contracts or placement agent agreements whereby the other party to such
contract or agreement shall undertake to furnish the Trustees such investment
advisory, administrative, placement agent and/or other services as the Trustees
shall, from time to time consider desirable and all upon such terms and
conditions as the Trustees may in their discretion determine. Notwithstanding
any provisions of this Declaration, the Trustees may authorize any Investment
Advisor (subject to such general or specific instructions as the Trustees may
from time to time adopt) to effect purchases, sales, loans or exchanges of Trust
Property on behalf of the Trustees or may authorize any officer, employee or
Trustee to effect such purchases, sales, loans or exchanges pursuant to
recommendations of any such Investment Advisor (and all without further action
by the Trustees). Any such purchases, sales, loans and exchanges shall be deemed
to have been authorized by all of the Trustees.
4.2. Parties to Contract. Any contract of the character described in
Section 4.1 of this Article IV or in the By-Laws of the Trust may be entered
into with any corporation, firm, trust or association, although one or more of
the Trustees or officers of the Trust may be an officer, director, Trustee,
shareholder, or member of such other party to the contract, and no such contract
shall be invalidated or rendered voidable by reason of the existence of any such
relationship, nor shall any person holding such relationship be liable merely by
reason of such relationship for any loss or expense to the Trust under or by
reason of said contract or accountable for any profit realized directly or
indirectly therefrom, provided that the contract when entered into was
reasonable and fair and not inconsistent with the provisions of this Article IV
or the By-Laws. The same person (including a firm, corporation, trust, or
association) may be the other party to contracts entered into pursuant to
Section 4.1 above or the By-Laws of the Trust, and any individual may be
financially interested or otherwise affiliated with persons who are parties to
any or all of the contracts mentioned in this Section 4.2.
ARTICLE V
Limitations of Liability
5.1. No Personal Liability of Trustees, Officers, Employees, Agents;
Liability of Holders; Indemnification. No Trustee, officer, employee or agent of
the Trust shall be subject to any personal liability whatsoever to any Person,
other than the Trust or its Holders, in connection with Trust Property or the
affairs of the Trust, save only that arising from his bad faith, willful
misfeasance, gross negligence or reckless disregard of his duty to such Person;
and all such Persons shall look solely to the Trust Property for satisfaction of
claims of any nature against a Trustee, officer, employee or agent of the Trust
arising in connection with the affairs of the Trust. Each holder shall be
jointly and severally liable (with rights of contribution inter se in proportion
to their respective Interests in the Trust) for the liabilities and obligations
of the Trust in the event that the Trust fails to satisfy such liabilities and
obligations; provided, however, that, to the extent assets are available in the
Trust, the Trust shall indemnify and hold each Holder harmless from and against
any claim or liability, to which such Holder may become subject by reason of his
being or having been a Holder to the extent that such claim or liability imposes
on the Holder an obligation or liability which such Holder may become subject by
reason of his being or having been a Holder to the extent that such claim or
liability imposes on the Holder an obligation or liability which such Holder
may become subject by reasons of his being or having been a Holder to the
extent that such claim or liability imposes on the Holder an obligation or
liabilitiy which, when compared to the obligations and liabilities imposed on
other Holders, is greater than his Interest (proportionate share), and shall
reimburse such Holder for all legal and other expenses reasonably incurred by
him in connection with any such claim or liability. The rights accruing to a
Holder under this Section 5.1 shall not exclude any other right to which such
Holder may be lawfully entitled, nor shall anything herein contained restrict
the right of the Trust to indemnify or reimburse a Holder in any appropriate
situation even though not specifically provided herein. Notwithstanding the
indemnification procedure described above, it is intended that each Holder shall
remain jointly and severally liable to the Trust's creditors as a legal matter.
5.2. Non-liability of Trustees. etc. No Trustee, officer, employee or agent
of the Trust shall be liable to the Trust, its Holders, or to any 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 his duties.
5.3. Mandatory Indemnification. The Trust shall indemnify each of its
Trustees, officers, employees, and agents (including persons who serve at its
request as directors, officers or trustees of another organization in which it
has any interest, as a shareholder, creditor or otherwise) against all
liabilities and expenses (including amounts paid in satisfaction of judgments,
in compromise, as fines and penalties, and as counsel fees) reasonably incurred
by him in connection with the defense or disposition of any action, suit or
other proceeding, whether civil or criminal, in which he may be involved or with
which he may be threatened, while in office or thereafter, by reason of his
being or having been such a Trustee, officer, employee or agent, except with
respect to any matter as to which he shall have been adjudicated to have acted
in bad faith, willful misfeasance, gross negligence or reckless disregard of his
duties; provided, however, that as to any matter disposed of by a compromise
payment by such Person, pursuant to a consent decree or otherwise, no
indemnification either for said payment or for any other expenses shall be
provided unless there has been a determination that such Person did not engage
in willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office by the court or other body
approving the settlement or other disposition or by a reasonable determination,
based upon a review of readily available facts (as opposed to a full trial-type
inquiry), that he did not engage in such conduct by written opinion from
independent legal counsel approved by the Trustees. The rights accruing to any
Person under these provisions shall not exclude any other right to which he may
be lawfully entitled; provided that no Person may satisfy any right of indemnity
or reimbursement granted herein or in Section 5.1 or to which he may be
otherwise entitled except out of the property of the Trust. The Trustees may
make advance payments in connection with indemnification under this Section 5.3,
provided that the indemnified Person shall have given a written undertaking to
reimburse the Trust in the event it is subsequently determined that he is not
entitled to such indemnification.
5.4. No Bond Required of Trustees. No Trustee shall, as such, be obligated
to give any bond or surety or other security for the performance of any of his
duties hereunder.
5.5. No Duty of Investigation; Notice in Trust Instruments, etc. No
purchaser, lender, 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,
or other interest or undertaking of the Trust, and every other act or thing
whatsoever executed in connection with the Trust shall be conclusively taken to
have been executed or done by the executors thereof only in their capacity as
Trustees, officers, employees or agents of the Trust. Every written obligation,
contract, instrument, certificate or other interest or undertaking of the Trust
made or sold by the Trustees or by any officer, employee or agent of the Trust,
in their capacity as such, shall contain an appropriate recital to the effect
that the Trustee, officer, employee and agent of the Trust shall not personally
be bound by or liable thereunder, nor shall resort be had to their private
property for the satisfaction of any obligation or claim thereunder, and
appropriate references shall be made therein to the Declaration, and may contain
any further recital which they may deem appropriate, but the omission of such
recital shall not operate to impose personal liability on any of the Trustees,
officers, employees or agents of the Trust. The Trustees may maintain insurance
for the protection of the Trust Property, its Holders, 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
judgement shall deem advisable.
5.6. 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 any Investment Adviser, accountant, appraiser or
other experts or consultants 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.
ARTICLE VI
Interests of the Trust
6.1. Interests. The beneficial interest in the property of the Trust shall
consist of non-transferable Interests. The Trustees may permit the purchase of
Interests but only if the purchaser is an Institutional Investor. Individuals, S
corporations, partnerships and grantor trusts that are beneficially owned by an
individual, S corporation or partnership may not purchase Interests. Subject to
applicable law and to such restrictions as may be adopted by the Trustees, a
Holder may increase or decrease its Interest without limitation.
6.2. Rights of Holders. The ownership of the Trust Property of every
description and the right to conduct any business hereinbefore described are
vested exclusively in the Trustees, and the Holders shall have no right or title
therein other than the beneficial interest conferred by their Interests and they
shall have no right to call for any partition or division of any property,
profits, rights or units of the Trust. The Interests shall be personal property
giving only the rights in this Declaration specifically set forth.
6.3. Purchase of or Increase of Interests. The Trustees, in their
discretion, may, from time to time, without a vote of the Holders, permit the
purchase of Interests by such party or parties (or increase in the Interest of a
Holder) and for such type of consideration, including cash or property, at such
time or times (including, without limitation, each business day), and on such
terms as the Trustees may deem best, and may in such manner acquire other assets
(including the acquisition of assets subject to, and in connection with the
assumption of liabilities) and businesses.
6.4. Register of Interests. A register shall be kept at the Trust under the
direction of the Trustees which shall contain the names and addresses of the
Holders and the Book Capital Account balances of each Holder. Each such register
shall be conclusive as to who are the Holders of the Trust and who shall be
entitled to payments of distributions or otherwise to exercise or enjoy the
rights of Holders. No Holder shall be entitled to receive payment of any
distribution, nor to have notice given to him as herein provided, until it has
given its address to such other officer or agent of the Trustees as shall keep
the said register for entry thereon.
6.5. Non-Transferability. Interests shall not be transferable.
6.6. Notices. Any and all notices to which any Holder hereunder may be
entitled and any and all communications shall be deemed duly served or given if
mailed, postage prepaid, addressed to any Holder of record at its last known
address as recorded on the register of the Trust.
<PAGE>
ARTICLE VII
Decreases And Withdrawals
7.1. Decreases and Withdrawals. A Holder shall have the authority to
decrease or withdraw its Interest in the Trust, at such Holder's option, subject
to the terms and conditions provided in this Article VII. The Trust shall, upon
application of any Holder or pursuant to authorization from any Holder, and
subject to this Article 7.1, decrease or withdraw such Holder's Interest for an
amount determined by the application of a formula adopted for such purpose by
resolution of the Trustees; provided that (a) such amount shall not exceed the
reduction in a Holder's Book Capital Account effected by such decrease or
withdrawal of its Interest and (b) if so authorized by the Trustees, the Trust
may, at any time and from time to time, charge fees for effecting such decrease
or withdrawal, at such rates as the Trustees may establish, and may, at any time
and from time to time, suspend such right of decrease or withdrawal. The
procedures for effecting decreases or withdrawals shall be as determined by the
Trustees from time to time.
ARTICLE VIII
Determination of Book Capital Account
Balances, Net Income and Distributions
8.1 Book Capital Account Balances. The Book Capital Account balances of
Holders of the Trust shall be determined daily at such time or times as the
Trustees may determine. The Trustees shall adopt resolutions setting forth the
method of determining the Book Capital Account balances for each Holder. The
power and duty to make calculations pursuant to such resolutions may be
delegated by the Trustees to the Investment Adviser, Administrator, custodian,
or such other person as the Trustees may determine.
8.2 Distributions and Allocations to Holders. The Trustees shall, in
compliance with the regulations promulgated under applicable provisions of the
Internal Revenue Code of 1986, as amended (herein the "Code", agree to (i) the
daily allocation of income or loss to each Holder of the Trust, (ii) the payment
of distributions to Holders and (iii) upon liquidation, the final distribution
of items of taxable income and expense. Such agreement shall be set forth in
written instructions directed to the Trust's accountants specifying the method
by which the Trust will comply with the Code. The Trustees may amend the
instructions adopted pursuant to this Section 8.2 from time to time to the
extent necessary to comply with the Code or any regulations promulgated
thereunder. The Trustees may always retain from the net profits such amount as
they may deem necessary to pay the debts or expenses of the Trust or to meet
obligation of the Trust, or as they may deem desirable to use in the conduct of
its affairs or to retain for future requirements or extensions of the business.
8.3 Power to Modify Foregoing Procedures. Notwithstanding any of the
foregoing provisions of this Article VIII, the Trustees may prescribe, in their
absolute discretion, such other bases and times for determining the net income
and net assets of the Trust, the allocation of income or the payment of
distributions to the Holders of the Trust as they may deem necessary or
desirable to enable the Trust to comply with any provision of the 1940 Act, any
rule or regulation thereunder, or any other order of exemption issued by said
Commission, all as in effect now or hereafter amended or modified.
ARTICLE IX
Holders
9.1. Meetings of Holders. Meetings of the Holders may be called at any time
by a majority of the Trustees and shall be called by any Trustee upon written
request of Holders holding, in the aggregate, not less than 10% of the Interests
of the Trust, such request specifying the purpose or purposes for which such
meeting is to be called. Any such meeting shall be held within or without the
State of New York on such day and at such time as the Trustees shall designate.
Holders of one-third of the Interests of the Trust, present in person or by
proxy shall constitute a quorum for the transaction of any business, except as
may otherwise be required by the 1940 Act or other applicable law or by this
Declaration or the By-Laws of the Trust. If a quorum is present at a meeting, an
affirmative vote of the Holders, present, in person or by proxy, holding more
than 50% of the total Interests of the Holders present, either in person or
proxy, at such meeting constitutes the action of the Holders, unless the 1940
Act, other applicable law, this Declaration or the By-Laws of the Trust requires
a greater number of affirmative votes.
9.2. Notice of Meetings. Notice of all meetings of the Holders, stating the
time, place and purpose of the meeting, shall be given by the Trustees by mail
to each Holder, at his registered address, mailed at least 10 days and not more
than 60 days before the meeting. At such meeting, any business properly before
the meeting may be considered whether or not stated in the notice of the
meeting. Any adjourned meeting may be held as adjourned without further notice.
9.3. Record Date for Meetings. At any meeting of Holders, any Holders who
are entitled to notice of and to vote at any meeting, or to participate in any
distribution, or for the purpose of any other action, the Trustees may from time
to time fix a date, not more than 90 days prior to the date of any meeting of
Holders or payment of distributions or other action, as a record date for the
determination of the Persons to be treated as Holders of record for such
purposes.
9.4. Proxies. etc. At any meeting of Holders, any Holder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Secretary, or with such other
officer or agent of the Trust as the Secretary may direct, for verification
prior to the time at which such vote shall be taken. Pursuant to a resolution of
a majority of the Trustees, proxies may be solicited in the name of one or more
Trustees or one or more of the officers of the Trust. Only Holders of record
shall be entitled to vote. Each full Unit shall be entitled to a vote
proportionate to its Interest in the Trust. When Interests are held jointly by
several persons, any one of them may vote at any meeting in person or by proxy
in respect to such Interest, but if more than one of them shall be present at
such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect to such Interest. A proxy purporting to be executed by or on behalf of a
Holder shall be deemed valid unless challenged at or prior to its exercise, and
the burden of providing invalidity shall rest on the challenger. If the Holder
of any such Unit is a minor or a person of unsound mind, and subject to
guardianship or to the legal control of any other person as regards the charge
or management of its Interest, he may vote by his guardian or such other person
appointed or having such control, and such vote may be given in person or by
proxy.
9.5. Reports. The Trustees shall cause to be prepared, at least annually, a
report of operations containing a balance sheet and statement of income and
undistributed income of the Trust prepared in conformity with generally accepted
accounting principles and an opinion of an independent public accountant on such
financial statements. The Trustees shall, in addition, furnish to the Holders at
least semiannually interim reports containing an unaudited balance sheet as of
the end of such period and an unaudited statement of income and surplus for the
period from the beginning of the current Fiscal Year to the end of such period.
9.6. Inspection of Records. The records of the Trust shall be open to
inspection by Holders during normal business hours for any purpose not harmful
to the Trust.
9.7. Holder Action by Written Consent. Any action which may be taken by
Holders may be taken without a meeting if Holders holding more than 50% of the
total Interests entitled to vote (or such larger proportion thereof as shall be
required by any express provision of this Declaration) shall consent to the
action in writing and the written consents are filed with the records of the
meetings of Holders. Such consent shall be treated for all purposes as a vote
taken at a meeting of Holders.
ARTICLE X
Duration; Termination of Trust;
Amendment; Mergers; Etc.
10.1. Duration. Subject to possible termination or dissolution in
accordance with the provision of Section 10.2 and 10.3 respectively, the Trust
created hereby shall continue until the expiration of 20 years after the death
of the last survivor of the initial Trustees named herein and the following
named persons:
Date of
Name Address Birth
David Cornelius Johnson 752 West End Avenue, Apt. 10J May 2, 1989
New York, NY 10025
Conner Leahy McCabe 100 Parkway Road, Apt. 3C February 22, 1989
Bronxville, NY 10708
Andrea Hellegers 530 E. 84th St., 5H December 22,1988
New York, NY 10028
Emily Charlotte Bond 192 Garth Rd., Apt. 2M April 22, 1989
Scarsdale, NY 10583
Emilie Blair Ruble 30 Fifth Avenue, Apt. 11F February 24, 1989
New York, NY 10011
Brian Patrick Lyons 152-48 Jewel Avenue January 20, 1989
Flushing, NY 11367
Caroline Bolger Cima 11 Beechwood Lane December 23, 1988
Scarsdale, NY 10583
10.2. Termination of Trust.
(a) The Trust may be terminated (i) by the affirmative vote of the
Holders of not less than two-thirds of the Interests of the Trust at any meeting
of the Holders or by an instrument in writing, without a meeting signed by a
majority of the Trustees and consented to by the Holders of not less than
two-thirds of such Interests, or (ii) by the Trustees by written notice to the
Holders. Upon any such termination,
(i) The Trust shall carry on no business except for the purpose of
winding up its affairs.
(ii) The Trustees shall proceed to wind up the affairs of the Trust
[or such Series] and all of the powers of the Trustees under this
Declaration shall continue until the affairs of the Trust shall have
been wound up, including the power to fulfill or discharge the contracts of
the Trust, collect its assets, sell, convey, assign, exchange, or otherwise
dispose of all or any part of the remaining Trust Property to one or more
persons at public or private sale for consideration which may consist in
whole or in part of cash, securities or other property of any kind,
discharge or pay its liabilities, and do all other acts appropriate to
liquidate its business; provided that any sale, conveyance, assignment,
exchange, or other disposition of all or substantially all the Trust
Property shall require approval of the principal terms of the transaction
and the nature and amount of the consideration by vote of the Holders of a
majority of the Interests entitled to vote.
(iii) After paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities and refunding
agreements, as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property, in cash or in kind or partly each,
among the Holders according to their respective rights.
(b) Upon termination of the Trust and distribution to the Holders as
herein provided a majority of the Trustees shall execute and lodge among the
records of the Trust an instrument in writing setting forth the fact of such
termination. Upon termination of the Trust, the Trustees shall thereupon be
discharged from all further liabilities and duties hereunder, and the rights and
interest of all Holders shall thereupon cease.
10.3 Dissolution. Upon the withdrawal, resignation, retirement, bankruptcy
or expulsion of any Holder, the Trust shall be dissolved and terminated effected
120 days after such event. However, the Holders may, by a unanimous affirmative
vote of Holders of the Interests of the Trust at any meeting of the Holders or
by an instrument in writing without a meeting signed by a majority of the
Trustees and consented to by all of the Holders of such Interests, agree to
continue the business of the Trust even if there has been a prior dissolution
and termination.
10.4. Amendment Procedure.
(a) This Declaration may be amended by the vote of Holders of holding
more than 50% of the total Interests entitled to vote by an instrument in
writing, without a meeting, signed by a majority of the Trustees and consented
to by the Holders holding more than 50% of the total Interests entitled to vote.
The Trustees may also amend this Declaration without the vote or consent of the
Holders to change the name of the Trust, to supply any omission, to cure,
correct or supplement any ambiguous, defective or inconsistent provision hereof,
or to conform this Declaration to the requirements of applicable federal laws or
regulations or the requirements of the provisions of the Internal Revenue Code
of 1986, as amended, but the Trustees shall not be liable for failing to do so.
(b) No amendment may be made, under Section 10.4(a) above, which would
change any rights with respect to any Interest of the Trust by reducing the
amount payable thereon upon liquidation of the Trust or by diminishing or
eliminating any voting rights pertaining thereto, except with the vote or
consent of the Holders of two-thirds of the Interest of the Trust.
(c) A certification in recordable form signed by a majority of the
Trustees setting forth an amendment and reciting that it was duly adopted by the
Holders or by the Trustees as aforesaid or a copy of the Declaration, as
amended, in recordable form, and executed by a majority of the Trustees, shall
be conclusive evidence of such amendment when lodged among the records of the
Trust.
Notwithstanding any other provisions hereof, until such time as Interests
are first sold, this Declaration may be terminated or amended in any respect by
the affirmative vote of a majority of the Trustees or by an instrument signed by
a majority of the Trustees.
10.5. Merger, Consolidation and Sale of Assets. The Trust, or any series
thereof, may merge or consolidate with any other corporation, association, trust
or other organization or may sell, lease or exchange all or substantially all of
its property, including its good will, upon such terms and conditions and for
such consideration when and as authorized at any meeting of Holders called for
the purpose by the affirmative vote of the Holders of not less than two-thirds
of the Interests of the Trust, or by an instrument or instruments in writing
without a meeting, consented to by the Holders of not less than two-thirds of
such Interests, and any such merger, consolidation, sale, lease or exchange
shall be deemed for all purposes to have been accomplished under and pursuant to
the statutes of the State of New York.
10.6. Incorporation. Upon a Majority Interests Vote, the Trustees may cause
to be organized or assist in organizing a corporation or corporations under the
laws of any jurisdiction or any other trust, partnership, association or other
organization to take over all of the Trust Property or to carry on any business
in which the Trust shall directly or indirectly have any interest and to sell,
convey and transfer the Trust Property to any such corporation, trust,
association or organization in exchange for the equity interests thereof or
otherwise, and to lend money to, subscribe for the equity interests of, and
enter into any contracts with any such corporation, trust, partnership,
association or organization, or any corporation, partnership, trust, association
or organization in which the Trust holds or is about to acquire equity
interests. The Trustees may also cause a merger or consolidation between the
Trust or any successor thereto and any such corporation, trust, partnership,
association or other organization if and to the extent permitted by law, as
provided under the law then in effect. Nothing contained herein shall be
construed as requiring approval of Holders for the Trustees to organize or
assist in organizing one or more corporations, trusts, partnerships,
associations or other organizations and selling, conveying or transferring a
portion of the Trust Property to such organizations or entities.
ARTICLE XI
Miscellaneous
11.1. Certificate of Designation; Agent for Service of Process. The Trust
shall file, in the Department of State of New York, a certificate, in the Trust
name and signed by an officer of the Trust, designating the Secretary of the
State of New York as an agent upon whom process in any action or proceeding
against the Trust may be served.
11.2. Governing Law. This Declaration is executed by the Trustees and
delivered in the State of New York and with reference to the laws thereof, and
the rights of all parties and the validity and construction of every provision
hereof shall be subject to and construed according to the laws of the State of
New York and reference shall specifically made to the trust law of the State of
New York as to the construction of matters not specifically covered herein or as
to which an ambiguity exists.
11.3. Counterparts. This Declaration may be simultaneously executed in
several counterparts, each of which shall be deemed to be an original, and such
counterparts, together, shall constitute one and the same instrument, which
shall be sufficiently evidenced by any such original counterpart.
11.4. Reliance by Third Parties. Any certificate executed by an individual
who, according to the records of the Trusts or of any recording office in which
this Declaration may be recorded, appears to be a Trustee hereunder, certifying
to: (a) the number or identity of Trustees or Holders, (b) the due authorization
of the execution of any instrument or writing, (c) the form of any vote passed
at a meeting of Trustees or Holders, (d) the fact that the number of Trustees or
Holders present at any meeting or executing any written instrument satisfies the
requirements of this Declaration, (e) the form of any By-Laws adopted by or the
identity of any officers elected by the Trustees, or (f) the existence of any
fact or facts which in any manner relate to the affairs of the Trust, shall be
conclusive evidence as to the matters so certified in favor of any person
dealing with the Trustees and their successors.
11.5. Provisions in Conflict With Law or Regulations.
(a) The provisions of this Declaration are severable, and if the
Trustees shall determine, with the advice of counsel, that any of such provision
is in conflict with the 1940 Act, or with other applicable laws and regulations,
the conflicting provision shall be deemed never to have constituted a part of
this Declaration; provided, however, that such determination shall not affect
any of the remaining provisions of this Declaration or render invalid or
improper any action taken or omitted prior to such determination.
(b) If any provision of the Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.
<PAGE>
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
/s/ Cynthia J. Colitti
as Trustee
and not individually
6 St. James Avenue
Boston, Massachusetts
/s/ Philip W. Coolidge
as Trustee
and not individually
6 St. James Avenue
Boston, Massachusetts
/s/ Gail E. McHugh
as Trustee
and not individually
6 St. James Avenue
Boston, Massachusetts
Commonwealth of Massachusetts
Suffolk, SS
December 13, 1989
Then personally appeared the above-named Cynthia J. Colitti, Philip W. Coolidge,
and Gail McHugh who severally acknowledged the foregoing instrument to be their
free act and deed.
/s/ Molly S. Mugler
----------------------------------
Molly S. Mugler
NOTARY PUBLIC
My commission expires 4/27/90
<PAGE>
EXHIBIT NO. 1(b)
CASH RESERVES PORTFOLIO
Amendment of Amended and Restated
Declaration of Trust
The undersigned, being a majority of the Trustees of Cash Reserves
Portfolio, a trust established pursuant to a Declaration of Trust dated as of
May 23, 1989 and amended and restated as of December 13, 1989 (the "Declaration
of Trust"), hereby amend the Declaration of Trust by adding the following at the
end of paragraph (a) of Section 10.4 of the Declaration of Trust:
"Notwithstanding any other provision hereof, this Declaration may be
amended by an instrument in writing, without a meeting, signed by a
majority of the Trustees, and without the vote or consent of Holders, for
any one or more of the following purposes: (i) to change the state or other
jurisdiction designated herein as the state or other jurisdiction whose
laws shall be the governing low hereof, (ii) to effect such changes herein
as the Trustees find to be necessary or appropriate (A) to permit the
filing of this Declaration under the laws of such state or other
jurisdiction applicable to trusts or voluntary associations, (B) to permit
the Trust to elect to be treated as a "regulated investment company" under
the applicable provisions of the Internal Revenue Code of 1986, as amended,
or (C) to permit the transfer of Interests (or to permit the transfer of
any other beneficial interests or shares in the Trust, however
denominated), and (iii) in conjunction with any amendment contemplated by
the foregoing clause (i) or the foregoing clause (ii) to make any and all
such further changes or modifications to this Declaration as the Trustees
find to be necessary or appropriate, any finding of the Trustees referred
to in the foregoing clause (ii) or clause (iii) to be conclusively
evidenced by the execution of any such amendment by a majority of the
Trustees; provided, however, that unless effected in compliance with the
provisions of the following paragraph (b), no amendment otherwise
authorized by this sentence may be made which would reduce the amount
payable with respect to any Interest in the Trust upon liquidation of the
Trust."
<PAGE>
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of March 15, 1990.
/s/ Philip Coolidge
---------------------------------
Philip Coolidge
Trustee
/s/ Walter E. Robb
---------------------------------
Walter E. Robb
Trustee
/s/ Elliott J. Berv
---------------------------------
Elliott J. Berv
Trustee
/s/ T. Dean Williams
---------------------------------
T. Dean Williams
Trustee
The undersigned, being holders of all outstanding Interests in the Trust,
do hereby consent to the foregoing amendment as of the date set forth above.
LANDMARK PREMIUM FUNDS
By: /s/ Philip Coolidge
---------------------------------
Philip Coolidge
Title: President
THE LANDMARK FUNDS
BROKER-DEALER SERVICES, INC.
By: /s/ Philip Coolidge
---------------------------------
Philip Coolidge
Title: President
The undersigned, being the sole holder of Shares of Beneficial Interest of
Landmark Premium Funds, does hereby consent to the execution of the foregoing
consent by landmark Premium Funds as of the date set forth above.
THE LANDMARK FUNDS
BROKER-DEALER SERVICES, INC.
By: /s/ Philip Coolidge
---------------------------------
Philip Coolidge
Title: President
<PAGE>
CASH RESERVES PORTFOLIO
Second Amendment of Amended and Restated
Declaration of Trust
The undersigned, being a majority of the Trustees of Cash Reserves
Portfolio, a trust established pursuant to a Declaration of Trust dated as of
May 23, 1989 and amended and restated as of December 13, 1989 and further
amended as of March 15, 1990 (the "Declaration of Trust"), hereby, pursuant to
paragraph (a) of Section 10.4 of the Declaration of Trust, amend the Declaration
of Trust by adding the following at the end of Section 6.3 thereof:
"The second sentence of Section 6.1 hereof shall not be construed to limit
the authority of the Trustees, pursuant to Section 3.4 hereof or this
Section 6.3, or otherwise, to authorize the purchase of Interests without a
vote of the Holders, Provided that the purchaser is a regulated investment
company, segregated asset account, foreign investment company, common trust
fund, group trust or other investment arrangement, whether organized within
or without the United States of America, and is not an individual, S
corporation, partnership or grantor trust beneficially owned by any
individual, S corporation or partnership."
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of February 3, 1994, at Nassau, The Bahamas.
/s/ Elliott J. Berv
---------------------------------
Elliott J. Berv
Trustee
/s/ Philip Coolidge
---------------------------------
Philip Coolidge
Trustee
/s/ Walter E. Robb
---------------------------------
Walter E. Robb
Trustee
<PAGE>
EXHIBIT NO. 2
CASH RESERVES PORTFOLIO
BY-LAWS
These By-Laws are made and adopted pursuant to Section 2.7 of the
Declaration of Trust establishing the CASH RESERVES PORTFOLIO, dated March 1,
1990, as from time to time amended (hereinafter called the "Declaration"). All
words and terms capitalized in these By-Laws shall have the meaning or meanings
set forth for such words or terms in the Declaration.
ARTICLE I
Unitholders Meeting
1.1 Chairman. The Chairman, if any, shall act as chairman at all
meetings of the Unitholders; in his absence, the President shall act as
chairman; and in the absence of the Chairman and the President, the Trustee or
Trustees present at each meeting may elect a temporary chairman for the meeting,
who may be one of themselves.
1.2 Proxies; Voting. Unitholders may vote either in person or by
duly executed proxy and each full unit ("Unit") represented at the meeting shall
have one vote, all as provided in Article X of the Declaration. No proxy shall
be valid after eleven (11) months from the date of its execution, unless a
longer period is expressly stated in such proxy.
1.3 Fixing Record Dates. For the purpose of determining the
Unitholders who are entitled to notice of or to vote or act at a meeting,
including any adjournment thereof, or who are entitled to participate in any
distributions, or for any other proper purpose, the Trustees may from time to
time fix a record date in the manner provided in Section 10.3 of the
Declaration. If the Trustees do not, prior to any meeting of Unitholders, so fix
a record date, then the date of mailing notice of the meeting shall be the
record date.
1.4 Inspectors of Election. In advance of any meeting of
Unitholders, the Trustees may appoint Inspectors of Election to act at the
meeting or any adjournment thereof. If Inspectors of Election are not so
appointed, the Chairman, if any, of any meeting of Unitholders may, and on the
request of any Unitholder or his proxy shall, appoint Inspectors of Election of
the meeting. The number of Inspectors shall be either one or three. If appointed
at the meeting on the request of one or more Unitholders or proxies, a majority
of Units present shall determine whether one or three Inspectors are to be
appointed, but failure to allow such determination by the Unitholders shall not
affect the validity of the appointment of Inspectors of Election. In case any
person appointed as Inspector fails to appear or fails or refuses to act, the
vacancy may be filled by appointment made by the Trustees in advance of the
convening of the meeting or at the meeting by the person acting as Chairman. The
Inspectors of Election shall determine the number of Units outstanding, the
Units represented at the meeting, the existence of a quorum, the authenticity,
validity and effect of proxies, shall receive votes, ballots or consents, shall
hear and determine all challenges and questions in any way arising in connection
with the right to vote, shall count and tabulate all votes or consents,
determine the results, and do such other acts as may be proper to conduct the
election or vote with fairness to all Unitholders. If there are three Inspectors
of Election, the decision, act or certificate of a majority is effective in all
respects as the decision, act or certificate of all. On request of the Chairman,
if any, of the meeting, or of any Unitholder or his proxy, the Inspectors of
Election shall make a report in writing of any challenge or question or matter
determined by them and shall execute a certificate of any facts found by them.
1.5 Records at Unitholder Meetings. At each meeting of the
Unitholders there shall be open for inspection the minutes of the last previous
meeting of Unitholders of the Trust and a list of the Unitholders of the Trust,
certified to be true and correct by the Secretary or other proper agent of the
Trust, as of the record date of the meeting. Such list of Unitholders shall
contain the name of each Unitholder in alphabetical order and the address and
number of Units owned by such Unitholder. Unitholders shall have the right to
inspect books and records of the Trust during normal business hours and for any
purpose not harmful to the Trust.
1.6 Series Holders Meetings. Whenever a matter is required to be
voted by Holders of the Trust in the aggregate under Section 9.1 and 9.2 of the
Declaration, the Trust may either hold a meeting of Unitholders of all series to
vote on such matter, or hold separate meetings of Unitholders of each of the
individual series to vote on such matter, provided that (i) such separate
meetings shall be held within one year of each other, (ii) a quorum of the
individual series entitled to vote in person or by proxy shall be present at
each such separate meeting, and (iii) a quorum shall be present in the aggregate
at such separate meetings, and the votes of Unitholders at all such separate
meetings shall be aggregated in order to determine if sufficient votes have been
cast for such matter to be voted.
When separate meetings are held for Unitholders of each of the
individual series to vote on a matter required to be voted on by Unitholders of
the Trust in the aggregate, the record date of each separate meeting shall be
determined in the manner described above in Section 1.3.
ARTICLE II
Trustees
2.1 Annual and Regular Meetings. The Trustees shall hold an annual
meeting for the election of officers and the transaction of other business which
may come before such meeting. Regular meetings of the Trustees may be held
without call or notice at such place or places and times as the Trustees may by
resolution provided from time to time.
2.2 Special Meetings. Special Meetings of the Trustees shall be held
upon the call of the Chairman, if any, the President, the Secretary or any two
Trustees, at such time, on such day and at such place, as shall be designated in
the notice of the meeting.
2.3 Notice. Notice of a meeting shall be given by mail or by
telegram (which term shall include a tablegram) or delivered personally. If
notice is given by mail, it shall be mailed not later than 48 hours preceding
the meeting and if given by telegram or personally, such telegram shall be sent
or delivery made not later than 48 hours preceding the meeting. Notice by
telephone shall constitute personal delivery for these purposes. Notice of a
meeting of Trustees may be waived before or after any meeting by signed written
waiver. Neither the business to be transacted at, nor the purpose of, any
meeting of the Board of Trustees need be stated in the notice or waiver of
notice of such meeting, and no notice need be given of action proposed to be
taken by unanimous written consent. The attendance of a Trustee at a meeting
shall constitute a waiver of notice of such meeting except where a Trustee
attends a meeting for the express purpose of objecting, at the commencement of
such meeting, to the transaction of any business on the ground that the meeting
has not been lawfully called or convened.
2.4 Chairman; Records. The Chairman, if any, shall act as chairman
at all meetings of the Trustees; in his absence the President shall act as
chairman; and, in the absence of the Chairman and the President, the Trustees
present shall elect one of their number to act as temporary chairman. The
results of all actions taken at a meeting of the Trustees, or by unanimous
written consent of the Trustees, shall be recorded by the Secretary.
ARTICLE III
Officers
3.1 Officers of the Trust. The officers of the Trust shall consist
of a Chairman, if any, a President, a Secretary, a Treasurer and such other
officers or assistant officers, including Vice Presidents, as may be elected by
the Trustees. Any two or more of the offices may be held by the same person,
except that the same person may not be both President and Secretary. The
Trustees may designate a Vice President as an Executive Vice President and may
designate the order in which the other Vice Presidents may act. The Chairman and
the President shall be Trustees, but no other officer of the Trust need be a
Trustee.
3.2 Election and Tenure. At the initial organization meeting and
thereafter at each annual meeting of the Trustees, the Trustees shall elect the
Chairman, if any, President, Secretary, Treasurer and such other officers as the
Trustees shall deem necessary or appropriate in order to carry out the business
of the Trust. Such officers shall hold office until the next annual meeting of
the Trustees and until their successors have been duly elected and qualified.
The Trustees may fill any vacancy in office or add any additional officers at
any time.
3.3 Removal of Officers. Any officer may be removed at any time,
with or without cause, by action of a majority of the Trustees. This provision
shall not prevent the making of a contract of employment for a definite term
with any officer and shall have no effect upon any cause of action which any
officer may have as a result of removal in breach of a contract of employment.
Any officer may resign at any time by notice in writing signed by such officer
and delivered or mailed to the Chairman, if any, President, or Secretary, and
such resignation shall take effect immediately, or at a later date according to
the terms of such notice in writing.
3.4 Bonds and Surety. Any officer may be required by the Trustees to
be bonded for the faithful performance of his duties in such amount and with
such sureties as the Trustees may determine.
3.5 Chairman, President, and Vice Presidents. The Chairman, if any,
shall, if present, preside at all meetings of the Unitholders and of the
Trustees and shall exercise and perform such other powers and duties as may be
from time to time assigned to him by the Trustees. Subject to such supervisory
powers, if any, as may be given by the Trustees to the Chairman, if any, the
President shall be the chief executive officer of the Trust and, subject to the
control of the Trustees, shall have general supervision, direction and control
of the business of the Trust and of its employees and shall exercise such
general powers of management as are usually vested in the office of President of
a corporation. In the absence of the Chairman, if any, the President shall
preside at all meetings of the Unitholders and the Trustees. The President shall
be, ex officio, a member of all standing committees. Subject to direction of the
Trustees, the Chairman, if any, and the President shall each have power in the
name and on behalf of the Trust to execute any and all loan documents,
contracts, agreements, deeds, mortgages, and other instruments in writing, and
to employ and discharge employees and agents of the Trust. Unless otherwise
directed by the Trustees, the Chairman, if any, and the President shall each
have full authority and power, on behalf of all of the Trustees, to attend and
to act and to vote, on behalf of the Trust at any meetings of business
organizations in which the Trust holds an interest, or to confer such powers
upon any other persons, by executing any proxies duly authorizing such persons.
The Chairman, if any, and the President shall have such further authorities and
duties as the Trustees shall from time to time determine. In the absence or
disability of the President, the Vice Presidents in order of their rank or the
Vice President designated by the Trustees, shall perform all of the duties of
President, and when so acting shall have all the powers of and be subject to all
of the restrictions upon the President. Subject to the direction of the
President, each Vice President shall have the power in the name and on behalf of
the Trust to execute any and all loan documents, contracts, agreements, deeds,
mortgages and other instruments in writing, and, in addition, shall have such
other duties and powers as shall be designated from time to time by the Trustees
or by the President.
3.6 Secretary. The Secretary shall keep the minutes of all meetings
of, and record all votes of, Unitholders, Trustees and the Executive Committee,
if any. He shall be custodian of the seal of the Trust, if any, and he (and any
other person so authorized by the Trustees) shall affix the seal or, if
permitted, a facsimile thereof, to any instrument executed by the Trust which
would be sealed by a New York corporation executing the same or a similar
instrument and shall attest the seal and the signature or signatures of the
officer or officers executing such instrument on behalf of the Trust. The
Secretary shall also perform any other duties commonly incident to such office
in a New York business corporation, and shall have such other authorities and
duties as the Trustees shall from time to time determine.
3.7 Treasurer. Except as otherwise directed by the Trustees, the
Treasurer shall have the general supervision of the monies, funds, securities,
notes receivable and other valuable papers and documents of the Trust, and shall
have and exercise under the supervision of the Trustees and of the President all
powers and duties normally incident to his office. He may endorse for deposit or
collection all notes, checks and other instruments payable to the Trust or to
its order. He shall deposit all funds of the Trust as may be ordered by the
Trustees or the President. He shall keep accurate account of the books of the
Trust's transactions which shall be the property of the Trust, and which
together with all other property of the Trust in his possession, shall be
subject at all times to the inspection and control of the Trustees. Unless the
Trustees shall otherwise determine, the Treasurer shall be the principal
accounting officer of the Trust and shall also be the principal financial
officer of the Trust. He shall have such other duties and authorities as the
Trustees shall from time to time determine. Notwithstanding anything to the
contrary herein contained, the Trustees may authorize any adviser, administrator
or manager to maintain bank accounts and deposit and disburse funds on behalf of
the Trust.
3.8 Other Officers and Duties. The Trustees may elect such other
officers and assistant officers as they shall from time to time determine to be
necessary or desirable in order to conduct the business of the Trust. Assistant
officers shall act generally in the absence of the officer whom they assist and
shall assist that officer in the duties of his office. Each officer, employee
and agent of the Trust shall have such other duties and authority as may be
conferred upon him by the Trustees or delegated to him by the President.
ARTICLE IV
Miscellaneous
4.1 Depositories. In accordance with Section 7.1 of the Declaration,
the funds of the Trust shall be deposited in such depositories as the Trustees
shall designate and shall be drawn out on checks, drafts or other orders signed
by such officer, officers, agent or agents (including any adviser, administrator
or manager), as the Trustees may from time to time authorize.
4.2 Signatures. All contracts and other instruments shall be
executed on behalf of the Trust by such officer, officers, agent or agents, as
provided in these By-Laws or as the Trustees may from time to time by resolution
provide.
4.3 Seal. The seal of the Trust, if any, may be affixed to any
document, and the seal and its attestation may be lithographed, engraved or
otherwise printed on any document with the same force and effect as if it had
been imprinted and attested manually in the same manner and with the same effect
as if done by a New York business corporation.
4.4 Indemnification. Insofar as the conditional advancing of
indemnification monies under Section 5.3 of the Declaration of Trust, for
actions based upon the Investment Company Act of 1940 may be concerned, such
payments will be made only on the following conditions: (i) the advances must be
limited to amounts used, or to be used, for the preparation or presentation of a
defense to the action, including costs connected with the preparation of a
settlement; (ii) advances may be made only upon receipt of a written promise by,
or on behalf of, the recipient to repay that amount of the advance which exceeds
that amount to which it is ultimately determined that he is entitled to receive
from the Trust by reason of indemnification; and (iii) (a) such promise must be
secured by a surety bond, other suitable insurance or an equivalent form of
security which assures that any repayments may be obtained by the Trust without
delay or litigation, which bond, insurance or other form of security must be
provided by the recipient of the advance, or (b) a majority of a quorum of the
Trust's disinterested, non-party Trustees, or an independent legal counsel in a
written opinion, shall determine, based upon a review of readily available
facts, that the recipient of the advance ultimately will be found entitled to
indemnification.
ARTICLE V
Unit Non-Transferability
5.1 Non-Transferability of Units. Units shall not be transferable.
Except as otherwise provided by law, the Trust shall be entitled to recognize
the exclusive right of a person in whose name any Unit or Units stand on the
record of Unitholders as the owner of such Unit or Units for all purposes,
including, without limitation, the rights to receive distributions, and to vote
as such owner, and the Trust shall not be bound to recognize any equitable or
legal claim to or interest in any such Unit or Units on the part of any other
person.
5.2 Regulations. The Trustees may make such additional rules and
regulations, not inconsistent with these By-Laws, as they may deem expedient
concerning the issue of Units of the Trust. They may appoint, or authorize any
officer or officers to appoint, one or more registrars.
5.3 Registrars and the Like. As provided in Section 6.5 of the
Declaration, the Trustees shall have authority to employ and compensate such
registrars with respect to the Units of the Trust as the Trustees shall deem
necessary or desirable. In addition, the Trustees shall have power to employ and
compensate such distribution disbursing agents, warrant agents and agents for
the reinvestment of distributions as they shall deem necessary or desirable. Any
of such agents shall have such power and authority as is delegated to any of
them by the Trustee.
ARTICLE VI
Amendment of By-Laws
6.1 Amendment and Repeal of By-Laws. In accordance with Section 2.7
of the Declaration, the Trustees shall have the power to alter, amend or repeal
the By-Laws or adopt new By-Laws at any time. Action by the Trustees with
respect to the By-Laws shall be taken by an affirmative vote of a majority of
the Trustees. The Trustees shall in no event adopt By-Laws which are in conflict
with the Declaration, and any apparent inconsistency shall be construed in favor
of the related provisions in the Declaration.
The Declaration establishing the Cash Reserves Portfolio, a
copy of which together with all amendments thereto is on file in the office of
the Secretary of the State of New York, provides that the name Cash Reserves
Portfolio refers to the Trustees under the Declaration collectively as Trustees,
but not as individuals or personally; and no Trustee, officer, employee or agent
of the Cash Reserves Portfolio shall be held to any personal liability, nor
shall resort be had to their private property for the satisfaction of any
obligation or claim or otherwise in connection with the affairs of said Cash
Reserves Portfolio but the Trust Property only shall be liable.
<PAGE>
EXHIBIT NO. 5
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of August 3, 1989, by and between
the CASH RESERVES PORTFOLIO, a New York trust (the "Portfolio"), and CITIBANK,
N.A., a national banking association ("Citibank" or the "Adviser").
WITNESSETH:
WHEREAS, the Portfolio is engaged in business as an open-end investment
company registered under the Investment Company Act of 1940 (collectively with
the rules and regulations promulgated thereunder, the "1940 Act"); and
WHEREAS, the Portfolio wishes to engage the Adviser to provide certain
investment advisory services, and the Adviser is willing to provide such
investment advisory services to the Portfolio on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Duties of the Adviser. The Adviser shall provide the Portfolio with such
investment advice and supervision as the latter may from time to time consider
necessary for the proper supervision of its investment assets. Citibank shall
act as the Adviser to the Portfolio and as such shall furnish continuously an
investment program and shall determine from time to time what securities shall
be purchased, sold or exchanged and what portion of the assets of the Portfolio
shall be held uninvested, subject always to the restrictions of the Portfolio's
Declaration of Trust, dated May 23, 1989, and By-laws, as each may be amended
from time to time (respectively, the "Declaration" and the "By-Laws"), to the
provisions of the 1940 Act and to the Portolio's then-current Registration
Statement under the 1940 Act. The Adviser shall also make recommendations as to
the manner in which voting rights, rights to consent to corporate action and any
other rights pertaining to the securities held by the Portfolio shall be
exercised. Should the Board of Trustees of the Portfolio at any time, however,
make any definite determination as to investment policy and notify the Adviser
thereof in writing, the Adviser shall be bound by such determination for the
period, if any, specified in such notice or until similarly notified that such
determination has been revoked. The Adviser shall take, on behalf of the
Portfolio, all actions which it deems necessary to implement the investment
policies determined as provided above, and in particular to place all orders for
the purchase or sale of securities for the Portfolio's account with brokers or
dealers selected by it, and to that end the Adviser is authorized as the agent
of the Portfolio to give instructions to the custodian of the Portfolio as to
deliveries of securities and payments of cash for the account of the Portfolio.
In connection with the selection of such brokers or dealers and the placing of
such orders, the Adviser is directed to seek for the Portfolio in its best
judgment, prompt execution in an effective manner at the most favorable price.
Subject to this requirement of seeking the most favorable price, securities may
be bought from or sold to broker-dealers who have furnished statistical,
research and other information or services to the Adviser or the Portfolio,
subject to any applicable laws, rules and regulations. In making purchases or
sales of securities or other property for the account of the Portfolio the
Adviser may deal with itself or with the Trustees of the Portfolio or the
Portfolio's exclusive placing agent, to the extent such actions are permitted by
the 1940 Act.
2. Allocation of Charges and Expenses. The Adviser shall furnish at its own
expense all necessary services, facilities and personnel in connection with its
responsibilities under Section 1 above. It is understood that the Portfolio will
pay all of its own expenses including, without limitation, compensation of
Trustees not "affiliated" with the Adviser; governmental fees; interest charges;
taxes; membership dues in the Investment Company Institute allocable to the
Portfolio; fees and expenses of independent auditors, of legal counsel and of
any transfer agent, administrator, registrar or dividend disbursing agent of the
Portfolio; expenses of preparing, printing and mailing reports, notices, proxy
statements and reports to governmental officers and commissions and to investors
in the Portfolio; expenses connected with the execution, recording and
settlement of security transactions; insurance premiums; fees and expenses of
the custodian for all services to the Portfolio, including safekeeping of funds
and securities and maintaining required books and accounts; expenses of
calculating the net asset value of the Portfolio; and expenses of meetings of
the Portfolio's investors.
3. Compensation of the Adviser. For the services to be rendered, the
Portfolio shall pay to the Adviser an investment advisory fee computed and paid
monthly at an annual rate equal to 0.15% of the Portfolio's average daily net
assets for its then-current fiscal year. If Citibank serves as Adviser for less
than the whole of any period specified in this Section 3, the compensation to
Citibank, as Adviser, shall be prorated.
4. Covenants of the Adviser. The Adviser agrees that it will not deal with
itself, or with the Trustees of the Portfolio or the Portfolio's exclusive
placing agent as principals in making purchases or sales of securities or other
property for the account of the Portfolio, except as permitted by the 1940 Act,
and will comply with all other provisions of the Portfolio's Declaration and
By-Laws and the then-current Registration Statement of the Portfolio under the
1940 Act relative to the Adviser and its Directors and officers.
5. Limitation of Liability of the Adviser. The Adviser shall not be liable
for any error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in the execution of security transactions
for the Portfolio, except for wilful misfeasance, bad faith or gross negligence
in the performance of its duties, or by reason of reckless disregard of its
obligations and duties hereunder. As used in this Section 5, the term "Adviser"
shall include Directors, officers and employees of the Adviser as well as the
corporation itself.
6. Activities of the Adviser. The services of the Adviser to the Portfolio
are not to be deemed to be exclusive, Citibank being free to render investment
advisory and/or other services to others. It is understood that Trustees and
officers of, and investors in the Portfolio are or may be or may become
interested in the Adviser, as Directors, officers, employees, or otherwise and
that Directors, officers and employees of the Adviser are or may become
similarly interested in the Portfolio and that the Adviser may be or may become
interested in the Portfolio as an investor or otherwise.
7. Duration, Termination and Amendments of this Agreement. This Agreement
shall become effective as of the day and year first above written and shall
govern the relations between the parties hereto thereafter, and shall remain in
force until February 28, 1991 on which date it will terminate unless its
continuance after February 28, 1991 is "specifically approved at least annually"
(a) by the vote of a majority of the Trustees of the Portfolio who are not
"interested persons" of the Portfolio or of the Adviser at a meeting
specifically called for the purpose of voting on such approval, and (b) by the
Board of Trustees of the Portfolio or by "vote of a majority of the outstanding
voting securities" of the Portfolio.
This Agreement may be terminated at any time without the payment of any
penalty by the Trustees or by the "vote of a majority of the outstanding voting
securities" of the Portfolio, or by the Adviser, in each case on not more than
60 days' nor less than 30 days' written notice to the other party. This
Agreement shall automatically terminate in the event of its "assignment".
This Agreement may be amended only if such amendment is approved by the
"vote of a majority of the outstanding voting securities" of the Portfolio.
The terms "specifically approved at least annually" vote of a majority of
the outstanding voting securities", "assignment", "affiliated person", and
"interested persons", when used in this Agreement, shall have the respective
meanings specified in, and shall be construed in a manner consistent with, the
1940 Act, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission under said Act.
<PAGE>
IN WITNESS WHEREOF, the parties thereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
CASH RESERVES PORTFOLIO
By /s/ Philip Coolidge
----------------------------------
Philip Coolidge
CITIBANK, N.A.
By /s/ Peter P. Capacio
-----------------------------------
Peter P. Capacio
<PAGE>
EXHIBIT NO. 6
PLACEMENT AGENCY AGREEMENT
August 23, 1991
The Landmark Funds Broker-Dealer Services, Inc.
6 St. James Avenue
Boston, Massachusetts 02116
Gentlemen:
This is to confirm that, in consideration of the agreements hereinafter
contained, the undersigned, Cash Reserves Portfolio (the "Portfolio"), an
open-end diversified management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), organized as a
Massachusetts business trust, has agreed that The Landmark Funds Broker-Dealer
Services, Inc. ("LFBDS") shall be the placement agent (the "Placement Agent") of
beneficial interests of the Portfolio ("Portfolio Interests").
Services as Placement Agent.
1.1 LFBDS will act as Placement Agent of the Portfolio Interests covered by the
registration statement (as defined below) then in effect under the 1940
Act. In acting as Placement Agent under this Placement Agency Agreement,
neither LFBDS nor its employees nor any agents thereof shall make any offer
or sale of Portfolio Interests in a manner which would require the
Interests to be registered under the Securities Act of 1933, as amended
(the "1933 Act").
1.2 All activities by LFBDS and its agents and employees as Placement Agent of
Portfolio Interests shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations
adopted pursuant to the 1940 Act by the Securities and Exchange Commission
(the "Commission").
1.3 Nothing herein shall be construed to require the Portfolio to accept any
offer to purchase any Portfolio Interests, all of which shall be subject to
approval by the Portfolio's Board of Trustees.
1.4 The Portfolio shall furnish from time to time for use in connection with
the sale of Portfolio Interests such information with respect to the
Portfolio and Portfolio Interests as LFBDS may reasonably request. The
Portfolio shall also furnish LFBDS upon request with: (a) unaudited
semiannual statements of the Portfolio's books and accounts prepared by the
Portfolio, and (b) from time to time such additional information regarding
the Portfolio's financial or regulatory condition as LFBDS may reasonably
request.
1.5 The Portfolio represents to LFBDS that all registration statements filed by
the Portfolio with the Commission under the 1940 Act with respect to
Portfolio Interests have been prepared in conformity with the requirements
of such statute and the rules and regulations of the Commission thereunder.
As used in this Agreement the term "registration statement" shall mean any
registration statement filed with the Commission as modified by any
amendments thereto that at any time shall have been filed with the
Commission by or on behalf of the Portfolio . The Portfolio represents and
warrants to LFBDS that any registration statement will contain all
statements required to be stated therein in conformity with both such
statute and the rules and regulations of the Commission; that all
statements of fact contained in any registration statement will be true and
correct in all material respects at the time of filing of such registration
statements or amendments thereto; and that no registration statement will
include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading to a purchaser of Portfolio Interests. The Portfolio
may but shall not be obligated to propose from time to time such amendment
to any registration statement as in the light of future developments may,
in the opinion of the Portfolio's counsel, be necessary or advisable. If
the Portfolio shall not propose such amendment and/or supplement within
fifteen days after receipt by the Portfolio of a written request from LFBDS
to do so, LFBDS may, at its option, terminate this Agreement. The
Portfolio shall not file any amendment to any registration statement
without giving LFBDS reasonable notice thereof in advance; provided,
however, that nothing contained in this Agreement shall in any way limit
the Portfolio's right to file at any time such amendment to any
registration statement as the Portfolio may deem advisable, such right
being in all respects absolute and unconditional.
1.6 The Portfolio agrees to indemnify, defend and hold LFBDS, its several
officers and directors, and any person who controls LFBDS within the
meaning of Section 15 of the 1933 Act or Section 20 of the Securities and
Exchange Act of 1934 (the "1934 Act") (for purposes of this paragraph 1.6,
collectively, "Covered Persons") free and harmless from and against any and
all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which any Covered Person may
incur under the 1933 Act, the 1934 Act, common law or otherwise, arising
out of or based on any untrue statement of a material fact contained in any
registration statement, private placement memorandum or other offering
material ("Offering Material") or arising out of or based on any omission
to state a material fact required to be stated in any Offering Material or
necessary to make the statements in any Offering Material not misleading;
provided, however, that the Portfolio's agreement to indemnify Covered
Persons shall not be deemed to cover any claims, demands, liabilities or
expenses arising out of any financial and other statements as are furnished
in writing to the Portfolio by LFBDS in its capacity as Placement Agent for
use in the answers to any items of any registration statement or in any
statements made in any Offering Material, or arising out of or based on any
omission or alleged omission to state a material fact connection with the
giving of such information required to be stated in such answers or
necessary to make the answers not misleading; and further provided that the
Portfolio's agreement to indemnify LFBDS and the Portfolio's
representations and warranties herein before set forth in paragraph 1.5
shall not be deemed to cover any liability to the Portfolio or its
investors to which a Covered Person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of
its duties, or by reason of a Covered Person's reckless disregard of its
obligations and duties under this Agreement. The Portfolio shall be
notified of any action brought against a Covered Person, such notification
to be given by letter or by telegram addressed to the Portfolio, c/o Roger
P. Joseph, Esq., Bingham, Dana & Gould, 150 Federal Street, 24th floor,
Boston, Massachusetts 02110, with a copy to Philip W. Coolidge, 6 St. James
Avenue, 9th floor, Boston, Massachusetts 02116 promptly after the summons
or other first legal process shall have been duly and completely served
upon such Covered Person. The failure to so notify the Portfolio of any
such action shall not relieve the Portfolio from any liability except to
the extent that the Portfolio shall have been prejudiced by such failure,
or from any liability that the Portfolio may have to the Covered Person
against whom such action is brought by reason of any such untrue statement
or omission, otherwise than on account of the Portfolio's indemnity
agreement contained in this paragraph. The Portfolio will be entitled to
assume the defense of any suit brought to enforce any such claim, demand or
liability, but in such case such defense shall be conducted by counsel of
good standing chosen by the Portfolio and approved by LFBDS, which approval
shall not be unreasonably withheld. In the event the Portfolio elects to
assume the defense of any such suit and retain counsel of good standing
approved by LFBDS, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of them; but in
case the Portfolio does not elect to assume the defense of any such suit,
or in case LFBDS reasonably does not approve of counsel chosen by the
Portfolio, the Portfolio will reimburse the Covered Person named as
defendant in such suit, for the fees and expenses of any counsel retained
by LFBDS or such Covered Person. The Portfolio's indemnification agreement
contained in this paragraph and the Portfolio's representations and
warranties in this Agreement shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of Covered
Persons, and shall survive the delivery of any Portfolio Interests. This
agreement of indemnity will inure exclusively to Covered Persons and their
successors. The Portfolio agrees to notify LFBDS promptly of the
commencement of any litigation or proceedings against the Portfolio or any
of its officers or Portfolio ees in connection with the issue and sale of
any Portfolio Interests.
1.7 LFBDS agrees to indemnify, defend and hold the Portfolio, its several
officers and Portfolio ees, and any person who controls the Portfolio
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act (for purposes of this paragraph 1.7, collectively, "Covered Persons")
free and harmless from and against any and all claims, demands, liabilities
and expenses (including the costs of investigating or defending such
claims, demands, liabilities and any counsel fees incurred in connection
therewith) that Covered Persons may incur under the 1933 Act, the 1934 Act,
or common law or otherwise, but only to the extent that such liability or
expense incurred by a Covered Person resulting from such claims or demands
shall arise out of or be based on any untrue statement of a material fact
contained in information furnished in writing by LFBDS in its capacity as
Placement Agent to the Portfolio for use in the answers to any of the items
of any registration statement or in any statements in any Offering Material
or shall arise out of or be based on any omission to state a material fact
in connection with such information furnished in writing by LFBDS to the
Portfolio required to be stated in such answers or necessary to make such
information not misleading. LFBDS shall be notified of any action brought
against a Covered Person, such notification to be given by letter or
telegram addressed to LFBDS at 6 St. James Avenue, Boston, Massachusetts
02116, Attention: Philip W. Coolidge, promptly after the summons or other
first legal process shall have been duly and completely served upon such
Covered Person. LFBDS shall have the right of first control of the defense
of the action with counsel of its own choosing satisfactory to the
Portfolio if such action is based solely on such alleged misstatement or
omission on LFBDS's part, and in any other event each Covered Person shall
have the right to participate in the defense or preparation of the defense
of any such action. The failure to so notify LFBDS of any such action shall
not relieve LFBDS from any liability except to the extent that LFBDS shall
have been prejudiced by such failure, or from any liability that LFBDS may
have to Covered Persons by reason of any such untrue or alleged untrue
statement, or omission or alleged omission, otherwise than on account of
LFBDS's indemnity agreement contained in this paragraph.
1.8 No Portfolio Interests shall be offered by either LFBDS or the Portfolio
under any of the provisions of this Agreement and no orders for the
purchase or sale of Portfolio Interests hereunder shall be accepted by the
Portfolio if and so long as the effectiveness of the registration statement
or any necessary amendments thereto shall be suspended under any of the
provisions of the 1940 Act; provided, however, that nothing contained in
this paragraph shall in any way restrict or have an application to or
bearing on the Portfolio's obligation to redeem Portfolio Interests from
any investor in accordance with the provisions of the Portfolio's
registration statement or Declaration of Portfolio, as amended from time to
time.
1.9 The Portfolio agrees to advise LFBDS as soon as reasonably practical by a
notice in writing delivered to LFBDS or its counsel:
(a) of any request by the Commission for amendments to the registration
statement then in effect or for additional information;
(b) in the event of the issuance by the Commission of any stop order suspending
the effectiveness of the registration statement then in effect or the
initiation by service of process on the Portfolio of any proceeding for
that purpose;
(c) of the happening of any event that makes untrue any statement of a material
fact made in the registration statement then in effect or that requires the
making of a change in such registration statement in order to make the
statements therein not misleading; and
(d) of all action of the Commission with respect to any amendment to any
registration statement that may from time to time be filed with the
Commission.
For purposes of this paragraph 1.9, informal requests by or acts of the Staff of
the Commission shall not be deemed actions of or requests by the Commission.
1.10 LFBDS agrees on behalf of itself and its employees to treat confidentially
and as proprietary information of the Portfolio all records and other
information not otherwise publicly available relative to the Portfolio and
its prior, present or potential investors and not to use such records and
information for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and approval in
writing by the Portfolio, which approval shall not be unreasonably withheld
and may not be withheld where LFBDS may be exposed to civil or criminal
contempt proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the
Portfolio.
1.11 In addition to LFBDS's duties as Placement Agent, the Portfolio understands
that LFBDS may, in its discretion, perform additional functions in
connection with transactions in Portfolio Interests.
The processing of Share transactions may include, but is not limited to,
compilation of all transactions from LFBDS's various offices; creation of a
transaction tape and timely delivery of it to the Portfolio's transfer agent for
processing; reconciliation of all transactions delivered to the Portfolio's
transfer agent; and the recording and reporting of these transactions executed
by the Portfolio's transfer agent in customer statements; rendering of periodic
customer statements; and the reporting of IRS Form 1099 information at year end
if required.
LFBDS may also provide other investor services, such as communicating with
Portfolio investors and other functions in administering customer accounts for
Portfolio investors.
LFBDS understands that these services may result in cost savings to the
Portfolio or to the Portfolio's investment manager and neither the Portfolio nor
the Portfolio's investment manager will compensate LFBDS for all or a portion of
the costs incurred in performing functions in connection with transactions in
Portfolio Interests. Nothing herein is intended, nor shall be construed, as
requiring LFBDS to perform any of the foregoing functions.
2. Term.
This Agreement shall become effective on the date first above written and,
unless sooner terminated as provided herein, shall continue until May 24, 1992
and thereafter shall continue automatically for successive annual periods,
provided such continuance is specifically approved at least annually by (i) the
Portfolio's Board of Portfolio ees or (ii) by a vote of a majority (as defined
in the 1940 Act) of the Portfolio's outstanding voting securities, provided that
in either event the continuance is also approved by the majority of the
Portfolio's Trustees who are not interested persons (as defined in the 1940 Act)
of the Portfolio and who have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable without penalty, on not less than
60 days' notice, by the Board, by vote of a majority (as defined in the 1940
Act) of the Portfolio's outstanding voting securities, or by LFBDS. This
Agreement will also terminate automatically in the event of its assignment (as
defined in the 1940 Act and the rules thereunder).
3. Representations and Warranties.
LFBDS and the Portfolio each hereby represents and warrants to the other that it
has all requisite authority to enter into, execute, deliver and perform its
obligations under this Agreement and that, with respect to it, this Agreement is
legal, valid and binding, and enforceable in accordance with its terms.
4. Concerning Applicable Provisions of Law, etc.
This Agreement shall be subject to all applicable provisions of law, including
the applicable provisions of the 1940 Act and to the extent that any provisions
herein contained conflict with any such applicable provisions of law, the latter
shall control.
This Agreement is executed and delivered in Boston, Massachusetts, and the laws
of the Commonwealth of Massachusetts shall, except to the extent that any
applicable provisions of Federal Law shall be controlling, govern the
construction, validity and effect of this Agreement, without reference to
principles of conflicts of law.
<PAGE>
If the contract set forth herein is acceptable to you, please so indicate by
executing the enclosed copy of this Agreement and returning the same to the
undersigned, whereupon this Agreement shall constitute a binding contract
between the parties hereto effective at the closing of business on the date
hereof.
Yours very truly,
CASH RESERVES PORTFOLIO
By: /s/ Philip Coolidge
---------------------------------------
Philip Coolidge
President
Accepted:
THE LANDMARK FUNDS BROKER-DEALER SERVICES, INC.
By: /s/ Philip Coolidge
----------------------------------------
Philip Coolidge
Chief Executive Officer
<PAGE>
EXHIBIT NO. 7
CUSTODIAN CONTRACT
Between
CASH RESERVES PORTFOLIO
and
STATE STREET BANK AND TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held By It ............... 1
2. Duties of the Custodian with Respect to Property of
the Fund Held by the Custodian in the United
States .............................................................. 2
2.1 Holding Securities............................................. 2
2.2 Delivery of Securities......................................... 3
2.3 Registration of Securities..................................... 7
2.4 Bank Accounts.................................................. 8
2.5 Availability of Federal Funds.................................. 9
2.6 Collection of Income........................................... 9
2.7 Payment of Fund Monies ........................................ 10
2.8 Liability for Payment in Advance of Receipt of Securities
Purchased ..................................................... 13
2.9 Appointment of Agents.......................................... 13
2.10 Deposit of Securities in Securities System..................... 14
2.10A Fund Assets Held in the Custodian's Direct Paper System........ 17
2.11 Segregated Account............................................. 18
2.12 Ownership Certificates for Tax Purposes........................ 20
2.13 Proxies........................................................ 20
2.14 Communications Relating to Fund Portfolio
Securities.................................................... 20
2.15 Reports to Fund by Independent Public
Accountants................................................... 21
3. Duties of the Custodian with Respect to Property of
the Fund Held Outside of the United States........................... 22
3.1 Appointment of Foreign Sub-Custodians.......................... 22
3.2 Assets to be Held.............................................. 22
3.3 Foreign Securities Depositories................................ 23
3.4 Segregation of Securities...................................... 23
3.5 Agreements with Foreign Banking Institutions................... 23
3.6 Access of Independent Accountants of the Fund ................. 24
3.7 Reports by Custodian........................................... 24
3.8 Transactions in Foreign Custody Account........................ 25
3.9 Liability of Foreign Sub-Custodians............................ 26
3.10 Liability of Custodian......................................... 26
3.11 Reimbursement for Advances..................................... 27
3.12 Monitoring Responsibilities.................................... 28
3.13 Branches of U.S. Banks......................................... 29
4. Payments for Repurchases or Redemptions and Sales
of Shares of the Fund................................................ 29
5. Proper Instructions.................................................. 30
6. Actions Permitted Without Express Authority.......................... 31
7. Evidence of Authority................................................ 32
8. Duties of Custodian with Respect to the Books of
Account and Calculations of Net Asset Value and
Net Income........................................................... 32
9. Records.............................................................. 33
10. Opinion of Fund's Independent Accountant............................. 33
11. Compensation of Custodian............................................ 34
12. Responsibility of Custodian.......................................... 34
13. Effective Period, Termination and Amendment.......................... 36
14. Successor Custodian.................................................. 37
15. Interpretive and Additional Provisions............................... 39
16. Massachusetts Law to Apply........................................... 39
17. Prior Contracts...................................................... 39
18. Limitations of Liability of the Trustees and
Shareholders....................................................... 40
<PAGE>
CUSTODIAN CONTRACT
This Contract between Cash Reserves Portfolio, a business trust organized
and existing under the laws of the State of New York, having its principal place
of business at 6 St. James Avenue, Boston, Massachusetts, hereinafter called
the "Fund", and State Street Bank and Trust Company, a Massachusetts trust
company, having its principal place of business at 225 Franklin Street, Boston,
Massachusetts, 02110, hereinafter called the "Custodian",
WITNESSETH: That in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. Employment of Custodian and Property to be Held by It
The Fund hereby employs the Custodian as the custodian of its assets,
including securities it desires to be held in places within the United States
("domestic securities") and securities it desires to be held outside the United
States ("foreign securities") pursuant to the provisions of the Declaration of
Trust. The Fund agrees to deliver to the Custodian all securities and cash owned
by it, and all payments of income, payments of principal or capital
distributions received by it with respect to all securities owned by the Fund
from time to time, and the cash consideration received by it for such new or
treasury shares of capital stock, $0.00001 par value, ("Shares") of the Fund as
may be issued or sold from time to time. The Custodian shall not be responsible
for any property of the Fund held or received by the Fund and not delivered to
the Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Article 5),
the Custodian shall from time to time employ one or more sub-custodians located
in the United States, but only in accordance with an applicable vote by the
Board of Trustees of the Fund, and provided that the Custodian shall have no
more or less responsibility or liability to the Fund on account of any actions
or omissions of any sub-custodian so employed than any such sub-custodian has to
the Custodian. The Custodian may employ as sub-custodians for the Fund's
securities and other assets the foreign banking institutions and foreign
securities depositories designated in Schedule "A" hereto but only in accordance
with the provisions of Article 3.
2. Duties of the Custodian with Respect to Property of the Fund Held by the
Custodian in the United States
2.1 Holding Securities. The Custodian shall hold and physically segregate for
the account of the Fund all non-cash property, to be held by it in the
United States, including all domestic securities owned by the Fund, other
than (a) securities which are maintained pursuant to Section 2.10 in a
clearing agency which acts as a securities depository or in a book-entry
system authorized by the U.S. Department of the Treasury, collectively
referred to herein as "Securities System" and (b) commercial paper of an
issuer for which State Street Bank and Trust Company acts as issuing and
paying agent ("Direct Paper") which is deposited and/or maintained in the
Direct Paper System of the Custodian pursuant to Section 2.10A.
2.2 Delivery of Securities. The Custodian shall release and deliver
domestic securities owned by the Fund held by the Custodian or in a Securities
System account of the Custodian or in the Custodian's Direct Paper book-entry
system account ("Direct Paper System Account") only upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate by
the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Fund and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Fund;
3) In the case of a sale effected through a Securities System, in
accordance with the provisions of Section 2.10 hereof;
4) To the depository agent in connection with tender or other similar
offers for portfolio securities of the Fund;
5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in say
such case, the cash or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of
the Fund or into the name of any nominee or nominees of the
Custodian or into the name or nominee name of any agent appointed
pursuant to Section 2.9 or into the name or nominee name of any
sub-custodian appointed pursuant to Article 1; or for exchange for a
different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of units;
provided that, in any such case, the new securities are to be
delivered to the Custodian;
7) Upon the sale of such securities for the account of the Fund, to
the broker or its clearing agent, against a receipt, for examination
in accordance with "street delivery" custom; provided that in any
such case, the Custodian shall have no responsibility or liability
for any loss arising from the delivery of such securities prior to
receiving payment for such securities except as may arise from the
Custodian's own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or pursuant
to any deposit agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;
9) In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or temporary
securities for definitive securities; provided that, in any such
case, the new securities and cash, if any, are to be delivered to
the Custodian;
10) For delivery in connection with any loans of securities made by the
Fund, but only against receipt of adequate collateral as agreed upon
from time to time by the Custodian and the Fund, which may be in the
form of cash or obligations issued by the United States government,
its agencies or instrumentalities, except that in connection with
any loans for which collateral is to be credited to the Custodian's
account in the book-entry system authorized by the U.S. Department
of the Treasury, the Custodian will not be held liable or
responsible for the delivery of securities owned by the Fund prior
to the receipt of such collateral;
1l) For delivery as security in connection with any borrowings by the
Fund requiring a pledge of assets by the Fund, but only against
receipt of amounts borrowed;
12) For delivery in accordance with the provisions of any agreement
among the Fund, the Custodian and a broker/dealer registered under
the Securities Exchange Act of 1934 (the "Exchange Act") and a
member of The National Association of Securities Dealers, Inc.
("NASD"), relating to compliance with the rules of The Options
Clearing Corporation and of any registered national securities
exchange, or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the
Fund;
13) For delivery in accordance with the provisions of any agreement
among the Fund, the Custodian, and a Futures Commission Merchant
registered under the Commodity Exchange Act, relating to compliance
with the rules of the Commodity Futures Trading Commission and/or
any Contract Market, or any similar organization or organizations,
regarding account deposits in connection with tranactions by the
Fund;
14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such Transfer Agent or to the
holders of shares in connection with distributions in kind, as may
be described from time to time in the Fund's currently effective
prospectus and statement of additional information ("prospectus"),
in satisfaction of requests by holders of Shares for repurchase or
redemption; and
15) For any other proper corporate purpose, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of
the Board of Trustees or of the Executive Committee signed by an
officer of the Fund and certified by the Secretary or an Assistant
Secretary, specifying the securities to be delivered, setting forth
the purpose for which such delivery is to be made, declaring such
purpose to be a proper corporate purpose, and naming the person or
persons to whom delivery of such securities shall be made.
2.3 Registration of Securities. Domestic securities held by the Custodian
(other than bearer securities) shall be registered in the name of the Fund or in
the name of any nominee of the Fund or of any nominee of the Custodian which
nominee shall be assigned exclusively to the Fund, unless the Fund has
authorized in writing the appointment of a nominee to be used in common with
other registered investment companies having the same investment adviser as the
Fund, or in the name or nominee name of any agent appointed pursuant to Section
2.9 or in the name or nominee name of any sub-custodian appointed pursuant to
Article 1. All securities accepted by the Custodian on behalf of the Fund under
the terms of this Contract shall be in "street name" or other good delivery
form. If, however, the Fund directs the Custodian to maintain securities in
"street name", the Custodian shall utilize its best efforts only to timely
collect income due the Fund on such securities and to notify the Fund on a best
efforts basis only of relevant corporate actions including without limitation,
pendency of calls, maturities, tender or exchange offers.
2.4 Bank Accounts. The Custodian shall open and maintain a separate bank account
or accounts in the United States in the name of the Fund, subject only to draft
or order by the Custodian acting pursuant to the terms of this Contract, and
shall hold in such account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in accordance
with Rule 17f-3 under the Investment Company Act of 1940. Funds held by the
Custodian for the Fund may be deposited by it to its credit as Custodian in the
Banking Department of the Custodian or in such other banks or trust companies as
it may in its discretion deem necessary or desirable; provided, however, that
every such bank or trust company shall be qualified to act as a custodian under
the Investment Company Act of 1940 and that each such bank or trust company and
the funds to be deposited with each such bank or trust company shall be approved
by vote of a majority of the Board of Trustees of the Fund. Such funds shall be
deposited by the Custodian in its capacity as Custodian and shall be
withdrawable by the Custodian only in that capacity.
2.5 Availabllity of Federal Funds. Upon mutual agreement between the Fund
and the Custodian, the Custodian shall, upon the receipt of Proper Instructions,
make federal funds available to the Fund as of specified times agreed upon from
time to time by the Fund and the Custodian in the amount of checks received in
payment for Shares of the Fund which are deposited into the Fund's account.
2.6 Collection of Income. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments with
respect to United States registered securities held hereunder to which the Fund
shall be entitled either by law or pursuant to custom in the securities
business, and shall collect on a timely basis all income and other payments with
respect to United States bearer securities if, on the date of payment by the
issuer, such securities are held by the Custodian or its agent thereof and shall
credit such income, as collected, to the Fund's custodian account. Without
limiting the generality of the foregoing, the Custodian shall detach and present
for payment all coupons and other income items requiring presentation as and
when they become due and shall collect interest when due on securities held
hereunder. Income due the Fund on United States securities loaned pursuant to
the provisions of Section 2.2 (10) shall be the responsibility of the Fund. The
Custodian will have no duty or responsibility in connection therewith, other
than to provide the Fund with such information or data as may be necessary to
assist the Fund in arranging for the timely delivery to the Custodian of the
income to which the Fund is properly entitled.
2.7 Payment of Fund Monies. Upon receipt of Proper Instructions, which may
be continuing instructions when deemed appropriate by the parties, the Custodian
shall pay out monies of the Fund in the following cases only:
1) Upon the purchase of domestic securities, options, futures
contracts or options on futures contracts for the account of
the Fund but only (a) against the delivery of such securities,
or evidence of title to such options, futures contracts or
options on futures contracts, to the Custodian (or any bank,
banking firm or trust company doing business in the United
States or abroad which is qualified under the Investment
Company Act of 1940, as amended, to act as a custodian and has
been designated by the Custodian as its agent for this
purpose) registered in the name of the Fund or in the name of
a nominee of the Custodian referred to in Section 2.3 hereof
or in proper form for transfer; (b) in the case of a purchase
effected through a Securities System, in accordance with the
conditions set forth in Section 2.10 hereof; (c) in the case
of a purchase involving the Direct Paper System, in accordance
with the conditions set forth in Section 2.10A; (d) in the
case of repurchase agreements entered into between the Fund
and the Custodian, or another bank, or a broker-dealer which
is a member of NASD, (i) against delivery of the securities
either in certificate form or through an entry crediting the
Custodian's account at the Federal Reserve Bank with such
securities or (ii) against delivery of the receipt evidencing
purchase by the Fund of securities owned by the Custodian
along with written evidence of the agreement by the Custodian
to repurchase such securities from the Fund or (e) for
transfer to a time deposit account of the Fund in any bank,
whether domestic or foreign; such transfer may be effected
prior to receipt of a confirmation from a broker and/or the
applicable bank pursuant to Proper Instructions from the Fund
as defined in Article 5;
2) In connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section 2.2
hereof;
3) For the redemption or repurchase of Shares issued by the Fund
as set forth in Article 4 hereof;
4) For the payment of any expense or liability incurred by the
Fund, including but not limited to the following payments for
the account of the Fund: interest, taxes, management,
accounting, transfer agent and legal fees, and operating
expenses of the Fund whether or not such expenses are to be in
whole or part capitalized or treated as deferred expenses;
5) For the payment of any dividends declared pursuant to the
governing documents of the Fund;
6) For payment of the amount of dividends received in respect of
securities sold short;
7) For any other proper purpose, but only upon receipt of, in addition
to Proper Instructions, a certified copy of a resolution of the
Board of Trustees or of the Executive Committee of the Fund signed
by an officer of the Fund and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment, setting
forth the purpose for which such payment is to be made, declaring
such purpose to be a proper purpose, and naming the person or
persons to whom such payment is to be made.
2.8 Liability for Payment in Advance of Receipt of Securities Purchased. Except
as specifically stated otherwise in this Contract, in any and every case
where payment for purchase of domestic securities for the account of the
Fund is made by the Custodian in advance of receipt of the securities
purchased in the absence of specific written instructions from the Fund to
so pay in advance, the Custodian shall be absolutely liable to the Fund for
such securities to the same extent as if the securities had been received
by the Custodian.
2.9 Appointment of Agents. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940,
as amended, to act as a custodian, as its agent to carry out such of the
provisions of this Article 2 as the Custodian may from time to time direct;
provided, however, that the appointment of any agent shall not relieve the
Custodian of its responsibilities or liabilities hereunder.
2.10 Deposit of Securities in Securities Systems. The Custodian may deposit
and/or maintain domestic securities owned by the Fund in a clearing agency
registered with the Securities and Exchange Commission under Section 17A of
the Securities Exchange Act of 1934, which acts as a securities depository,
or in the book-entry system authorized by the U.S. Department of the
Treasury and certain federal agencies, collectively referred to herein as
"Securities System" in accordance with applicable Federal Reserve Board and
Securities and Exchange Commission rules and regulations, if any, and
subject to the followng provisions:
1) The Custodian may keep domestic securities of the Fund in a
Securities System provided that such securities are represented in
an account ("Account") of the Custodian in the Securities System
which shall not include any assets of the Custodian other than
assets held as a fiduciary, custodian or otherwise for customers;
2) The records of the Custodian with respect to domestic securities of
the Fund which are maintained in a Securities System shall identify
by book-entry those securities belonging to the Fund;
3) The Custodian shall pay for domestic securities purchased for the
account of the Fund upon (i) receipt of advice from the Securities
System that such securities have been transferred to the Account,
and (ii) the making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of the Fund. The
Custodian shall transfer domestic securities sold for the account
of the Fund upon (i) receipt of advice from the Securities System
that payment for such securities has been transferred to the
Account, and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account of
the Fund. Copies of all advices from the Securities System of
transfers of domestic securities for the account of the Funds shall
identify the Fund, be maintained for the Fund by the Custodian and
be provided to the Fund at its request. Upon request, the Custodian
shall furnish the Fund confirmation of each transfer to or from the
account of the Fund in the form of a written advice or notice and
shall furnish to the Fund copies of daily transaction sheets
reflecting each day's transactions in the Securities System for the
account of the Fund.
4) The Custodian shall provide the Fund with any report obtained by
the Custodian on the Securities System's accounting system,
internal accounting control and procedures for safeguarding
domestic securities deposited in the Securities System;
5) The Custodian shall have received the initial or annual
certificate, as the case may be, required by Article 13 hereof;
6) Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the
Fund resulting from use of the Securities System by reason of any
negligence, misfeasance or misconduct of the Custodian or any of
its agents or of any of its or their employees or from failure of
the Custodian or any such agent to enforce effectively such rights
as it may have against the Securities System; at the election of
the Fund, it shall be entitled to be subrogated to the rights of
the Custodian with respect to any claim against the Securities
System or any other person which the Custodian may have as a
consequence of any such loss or damage if and to the extent that
the Fund has not been made whole for any such loss or damage.
2.10A Fund Assets Held in the Custodian's Direct Paper System. The Custodian may
deposit and/or maintain securities owned by the Fund in the Direct Paper
System of the Custodian subject to the following provisions:
1) No transaction relating to securities in the Direct Paper System will
be effected in the absence of Proper Instructions;
2) The Custodian may keep securities of the Fund in the Direct Paper
System only if such securities are represented in an account
("Account") of the Custodian in the Direct Paper System which shall not
include any assets of the Custodian other than assets held as a
fiduciary, custodian or otherwise for customers;
3) The records of the Custodian with respect to securities of the Fund
which are maintained the Direct Paper System shall identify by
book-entry those securities belonging to the Fund;
4) The Custodian shall pay for securities purchased for the account of the
Fund upon the making of an entry on the records of the Custodian to
reflect such payment and transfer of securities to the account of the
Fund. The Custodian shall transfer securities sold for the account of
the Fund upon the making of an entry on the records of the custodian to
reflect such transfer and receipt of payment for the account of the
Fund;
5) The Custodian shall furnish the Fund confirmation of each transfer to
or from the account of the Fund, in the form of a written advice or
notice, of Direct Paper on the next business day following such
transfer and shall furnish to the Fund copies of daily transaction
sheets reflecting each day's transaction in the Securities System for
the account of the Fund;'
6) The Custodian shall provide the Fund with any report on its system of
internal accounting control as the Fund may reasonably request from
time to time;
2.11 Segregated Account. The Custodian shall upon receipt of Proper Instructions
establish and maintain a segregated account or accounts for and on behalf
of the Fund, into which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by the Custodian
pursuant to Section 2.10 hereof, (i) in accordance with the provisions of
any agreement among the Fund, the Custodian and a broker-dealer registered
under the Exchange Act and a member of the NASD (or any futures commission
merchant compliance with the rules of The Options Clearing Corporation and
of any registered national securities exchange (or the Commodity Futures
Trading Commission or any registered contract market), or of any similar
organization or organizations, regarding escrow or other arrangements in
connection with transactions by the Fund, (ii) for purposes of segregating
cash or government securities in connection with options purchased, sold or
written by the Fund or commodity futures contracts or options thereon
purchased or sold by the Fund, (iii) for the purposes of compliance by the
Fund with the procedures required by Investment Company Act Release No.
10666, or any subsequent release or releases of the Securities and Exchange
Commission relating to the maintenance of segregated accounts by registered
investment companies and (iv) for other proper corporate purposes, but
only, in the case of clause (iv), upon receipt of, in addition to Proper
Instructions, a certified copy of a resolution of the Board of Trustees or
of the Executive Committee signed by an officer of the Fund and certified
by the Secretary or an Assistant Secretary, setting forth a purpose or
purposes of such segregated account and declaring such purposes to be
proper corporate purposes.
2.12 Ownership Certificates for Tax Purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments with
respect to domestic securities of the Fund held by it and in connection
with transfers of such securities.
2.13 Proxies. The Custodian shall, with respect to the domestic securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of
the Fund or a nominee of the Fund, all proxies, without indication of the
manner in which such proxies are to be voted, and shall promptly deliver to
the Fund such proxies, all proxy soliciting materials and all notices
relating to such securities.
2.14 Communications Relating to Fund Portfolio Securities. Subject to the
provisions of Section 2.3, the Custodian shall transmit promptly to the
Fund all written information (including, without limitation, pendency of
calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options
written by the Fund and the maturity of futures contracts purchased or sold
by the Fund) received by the Custodian from issuers of the domestic
securities being held for the Fund. With respect to tender or exchange
offers, the Custodian shall transmit promptly to the Fund all written
information received by the Custodian from issuers of the domestic
securities whose tender or exchange is sought and from the party (or his
agents) making the tender or exchange offer. If the Fund desires to take
action with respect to any tender offer, exchange offer or any other
similar transaction, the Fund shall notify the Custodian at least three
business days prior to the date on which the Custodian is to take such
action.
2.15 Reports to Fund by Independent Public Accountants. The Custodian shall
provide the Fund, at such times the Fund may reasonably require, with
reports by independent public accountants on the accounting system,
internal accounting control and procedures for safeguarding securities,
futures contracts and options on futures contracts, including domestic
securities deposited and/or maintained in a Securities System, relating to
the services provided by the Custodian under this Contract; such reports
shall be of sufficient scope and in sufficient detail, reasonably be
required by the Fund to provide reasonable assurance that any material
inadequacies would be disclosed by such examination, and, if there are no
such inadequacies, the reports shall so state.
3. Duties of the Custodian with Respect to Property Of the Fund Held Outside
of the United States
3.1 Appointment of Foreign Sub-Custodians
The Fund hereby authorizes and instructs the Custodian to employ as
sub-custodians for the Fund's securities and other assets maintained
outside the United States the foreign banking institutions and foreign
securities depositories designated on Schedule A hereto ("foreign
sub-custodians"). Upon receipt of "Proper Instructions", as defined in
Section 5 of this Contract, together with a certified resolution of the
Fund's Board of Trustees, the Custodian and the Fund may agree to amend
Schedule A hereto from tine to time to designate additional foreign banking
institutions and foreign securities depositories to act as sub-custodian.
Upon receipt of Proper Instructions, the Fund may instruct the Custodian to
cease the employment of any one or more such sub-custodians for maintaining
custody of the Fund's assets.
3.2 Assets to be Held. The Custodian shall limit the securities and other
assets maintained in the custody of the foreign sub-custodians to: (a)
"foreign securities", as defined in paragraph (c)(1) of Rule 17f-5 under
the Investment Company Act of 1940, and (b) cash and cash equivalents in
such amounts as the Custodian or the Fund may determine to be reasonably
necessary to effect the Fund's foreign securities transactions;
3.3 Foreign Securities Depositories. Except as may otherwise be agreed upon in
writing by the Custodian and the Fund, assets of the Fund shall be
maintained in foreign securities depositories only through arrangements
implemented by the foreign banking institutions serving as sub-custodians
pursuant to the terms hereof. Where possible, such arrangements shall
include entry into agreements containing the provisions set forth in
Section 3.5 hereof.
3.4 Segregation of Securities
The Custodian shall identify on its books as belonging to the Fund, the
foreign securities of the Fund held by each foreign sub-custodian. Each
agreement pursuant to which the Custodian employs a foreign banking
institution shall require that such institution establish a custody account
for the Custodian on behalf of the Fund and physically segregate in that
account, securities and other assets of the Fund, and, in the event that
such institution deposits the Fund's securities in a foreign securities
depository; that it shall identify on its books as belonging to the
custodian, as agent for the Fund, the securities so deposited;
3.5 Agreements with Foreign Banking Institutions. Each agreement with a foreign
banking institution shall be substantially in the form set forth in Exhibit
1 hereto and shall provide that: (a) the Fund's assets will not be subject
to any right, charge, security interest, lien or claim of any kind in favor
of the foreign banking institution or its creditors or agent, except a
claim of payment for their safe custody or administration; (b) beneficial
ownership of the Fund's assets will be freely transferable without the
payment of money or value other than for custody or administration; (c)
adequate records will be maintained identifying the assets as belonging to
the Fund; (d) officers of or auditors employed by, or other representatives
of the Custodian, including to the extent permitted under applicable law
the independent public accountants for the Fund, will be given access to
the books and records of the foreign banking institution relating to its
actions under its agreement with the Custodian; and (e) assets of the Fund
held by the foreign sub-custodian will be subject only to the instructions
of the Custodian or its agents.
3.6 Access of Independent Accountants of the Fund. Upon request of the Fund,
the Custodian will use its best efforts to arrange for the independent
accountants of the Fund to be afforded access to the books and records of
any foreign banking institution employed as a foreign sub-custodian insofar
as such books and records relate to the performance of such foreign banking
institution under its agreement wlth the Custodian.
3.7 Reports by Custodian. The Custodian will supply to the Fund from time to
time, as mutually agreed upon, statements in respect of the securities and
other assets of the Fund hold by foreign sub-custodians, including but not
limited to an identification of entities having possession of the Fund's
securities and other assets and advices or notifications of any transfers
of securities to or from each custodial account maintained by a foreign
banking institution for the Custodian on behalf of the Fund indicating, as
to securities acquired for the Fund, the identity of the entity having
physical possession of such securities.
3.8 Transactions in Foreign Custody Account
(a) Except as otherwise provided in paragraph (b) of this Section 3.8, the
provision of Sections 2.2 and 2.7 of this Contract shall apply, mutatis
mutandis to the foreign securities of the Fund held outside the United
States by foreign sub-custodians.
(b) Notwithstanding any provision of this Contract to the contrary,
settlement and payment for securities received for the account of the Fund
and delivery of securities maintained for the account of the Fund may be
effected in accordance with the customary established securities trading or
securities processing practices and procedures in the jurisdiction or
market in which the transaction occurs, including, without limitation,
delivering securities to the purchaser thereof or to a dealer therefor (or
an agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such securities from such
purchaser or dealer.
(c) Securities maintained in the custody of a foreign sub-custodian may be
maintained in the name of such entity's nominee to the same extent as set
forth in Section 2.3 of this Contract, and the Fund agrees to hold any such
nominee harmless from any liability as a holder of record of such
securities.
3.9 Liability of Foreign Sub-Custodians. Each agreement pursuant to which the
Custodian employs a foreign banking institution as a foreign sub-custodian
shall require the institution to exercise reasonable care in the
performance of its duties and to indemnify, and hold harmless, the
Custodian and each Fund from and against any loss, damage, cost, expense,
liability or claim arising out of or in connection with the institution's
performance of such obligations. At the election of the Fund, it shall be
entitled to be subrogated to the rights of the Custodian with respect to
any claims against a foreign banking institution as a consequence of any
such loss, damage, cost, expense, liability or claim if and to the extent
that the Fund has not been made whole for any such loss, damage, cost,
expense, liability or claim.
3.10 Liability of Custodian. The Custodian shall be liable for the acts or
omissions of a foreign banking institution to the same extent as set forth
with respect to sub-custodians generally in this Contract and, regardless
of whether assets are maintained in the custody of a foreign banking
institution, a foreign securities depository or a branch of a U.S. bank as
contemplated by paragraph 3.13 hereof, the Custodian shall not be liable
for any loss, damage, cost, expense, liability or claim resulting from
nationalization, expropriation, currency restrictions, or acts of war or
terrorism or any loss where the sub-custodian has otherwise exercised
reasonable care. Notwithstanding the foregoing provisions of this paragraph
3.10, in delegating custody duties to State Street London Ltd., the
Custodian shall not be relieved of any responsibility to the Fund for any
loss due to such delegation, except such loss as may result from (a)
political risk (including, but not limited to, exchange control
restrictions, confiscation, expropriation, nationalization, insurrection,
civil strife or armed hostilities) or (b) other losses (excluding a
bankruptcy or insolvency of State Street London Ltd. not caused by
political risk) due to Acts of God, nuclear incident or other losses under
circumstances where the Custodian and State Street London Ltd; have
exercised reasonable care.
3.11 Reimbursement for Advances. If the Fund requires the Custodian to advance
cash or securities for any purpose including the purchase or sale of
foreign exchange or of contracts for foreign exchange, or in the event that
the Custodian or its nominee shall incur or be assessed any taxes, charges,
expenses, assessments, claims or liabilities in connection with the
performance of this Contract, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful
misconduct, any property at any time held for the account of the Fund shall
be security therefor and should the Fund fail to repay the Custodian
promptly, the Custodian shall be entitled to utilize available cash and to
dispose of the Fund assets to the extent necessary to obtain reimbursement.
3.12 Monitoring Responsibilities. The Custodian shall furnish annually to the
Fund, during the month of June, information concerning the foreign
sub-custodians employed by the Custodian; Such information shall be similar
in kind and scope to that furnished to the Fund in connection with the
initial approval of this Contract; In addition, the Custodian will promptly
inform the Fund in the event that the Custodian learns of a material
adverse change in the financial condition of a foreign sub-custodian or any
material loss of the assets of the Fund or in the case of any foreign
sub-custodian not the subject of an exemptive order from the Securities and
Exchange Commission is notified by such foreign sub-custodian that there
appears to be a substantial likelihood that its shareholders' equity will
decline below $200 million (U.S. dollars or the equivalent thereof) or that
its shareholders' equity has declined below $200 million (in each case
computed in accordance with generally accepted U.S. accounting principles).
3.13 Branches of U.S. Banks
(a) Except as otherwise set forth in this Contract, the provisions hereof
shall not apply where the custody of the Fund assets are maintained in a
foreign branch of a banking institution which is a "bank" as defined by
Section 2(a)(5) of the Investment Company Act of l940 meeting the
qualification set forth in Section 26(a) of said Act; The appointment of
any such branch as a sub-custodian shall be governed by paragraph 1 of this
Contract.
(b) Cash held for the Fund in the United Kingdom shall be maintained in an
interest bearing account established for the Fund with the Custodian's
London branch, which account shall be subject to the direction of the
Custodian, State Street London Ltd. or both:
4. Payments for Repurchases or Redemptions and Sales of Shares of the Fund
From such funds as may be available for the purpose but subject to the
limitations of the Declaration of Trust and any applicable votes of the Board of
Trustees of the Fund Pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for payment to
holders of Shares who have delivered to the Transfer Agent a request for
redemption or repurchase of their Shares. In connection with the redemption or
repurchase of Shares of the Fund, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares of the Fund, the Custodian shall honor checks drawn on
the Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in accordance with
such procedures and controls as are mutually agreed upon from time to time
between the Fund and the Custodian;
The Custodian shall receive from the distributor for the Fund's Shares or
from the Transfer Agent of the Fund and deposit into the Fund's account such
payments as are received for Shares of the Fund issued or sold from time to time
by the Fund; The Custodian will provide timely notification to the Fund and the
Transfer Agent of any receipt by it of Payments for Shares of the Fund.
5. Proper Instructions
Proper Instructions as used herein means a writing signed or initialled by
one or more person or persons as the Board of Trustees shall have from time to
time authorized. Each such writing shall set forth the specific transaction or
type of transaction involved, including a specific statement of the purpose for
which such action is requested; Oral Instructions will be considered Proper
Instructions if the Custodian reasonably believes then to have been given by a
person authorized to give such instructions with respect to the transaction
involved; The Fund shall cause all oral instructions to be confirmed in writing.
Upon receipt of a certificate of the Secretary or an Assistant Secretary as to
the authorization by the Board of Trustees of the Fund accompanied by a detailed
description of procedures approved by the Board of Trustees, Proper Instructions
may include communications effected directly between electro-mechanical or
electronic devices provided that the Board of Trustees and the Custodian are
satisfied that such procedures afford adequate safeguards for the Funds assets;
For purposes of this Section, Proper Instructions shall include instructions
received by the Custodian pursuant to any three-party agreement which requires a
segregated asset account in accordance with Section 2.11.
6. Actions Permitted without Express Authority
The Custodian may in its discretion, without express authority from the
Fund;
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this Contract,
provided that all such payments shall be accounted for to the Fund;
2) surrender securities in temporary form for securities in definitive
form;
3) endorse for collection, in the name of the Fund, checks, drafts and
other negotiable Instruments; and
4) in general, attend to all non-discretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other dealings with the
securities sad property of the Fund except as otherwise directed by the Board of
Trustees of the Fund.
7. Evidence of Authority
The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a certified copy of a vote of the Board of
Trustees of the Fund as conclusive evidence (a) of the authority of any person
to act in accordance with such vote or (b) of any determination or of any action
by the Board of Trustees pursuant to the Declaration of Trust as described in
such vote, and such vote may be considered as in full force and effect until
receipt by the Custodian of written notice to the contrary.
8. Duties of Custodian with Respect to the Books of Account and Calculation of
Net Asset Value and Net Income
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board of Trustees of the Fund to keep the
books of account of the Fund and/or compute the net asset value per share of the
outstanding shares of the Fund or, if directed in writing to do so by the Fund,
shall itself keep such books of account and/or compute such net asset value per
share. If so directed the Custodian shall also calculate daily the net income of
the Fund as described in the Fund's currently effective prospectus and shall
advise the Fund and the Transfer Agent daily of the total amounts of such net
income and, if instructed in writing by an officer of the Fund to do so, shall
advise the Transfer Agent periodically of the division of such net income among
its various components. The calculations of the net asset value per share and
the daily income of the Fund shall be made at the time or times described from
time to time in the Fund's currently effective prospectus.
9. Records
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder.
All such records shall be the property of the Fund and shall at all times during
the regular business hours of the Custodian be open for inspection by duly
authorized officers, employees or agents of the Fund and employees and agents of
the Securities and Exchange Commission. The Custodian shall, at the Fund's
request, supply the Fund with a tabulation of securities owned by the Fund and
held by the Custodian and shall, when requested to do so by the Fund and for
such compensation as shall be agreed upon between the Fund and the Custodian,
include certificate numbers in such tabulations.
10. Opinion of Fund's Independent Accountant
The Custodian shall take all reasonable action, as the Fund may from time
to time request, to obtain from year to year favorable opinions from the Fund's
independent accountants with respect to its activities hereunder in connection
with the preparation of the Fund's Form N-1A, and Form N-SAR or other annual
reports to the Securities and Exchange Commission and with respect to any other
requirements of such Commission.
11. Compensation of Custodian
The Custodian shall be entitled to reasonable compensation for its services
and expenses as Custodian, as agreed upon from time to time between the Fund and
the Custodian.
12. Responsibility of Custodian
So long as and to the extent that it is in the exercise of reasonable care,
the Custodian shall not be responsible for the title, validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Contract, but shall be
kept indemnified by and shall be without liability to the Fund for any action
taken or omitted by it in good faith without negligence. It shall be entitled to
rely on and may act upon advice of counsel (who may be Counsel for the Fund) on
all matters, and shall be without liability for any action reasonably taken or
omitted pursuant to such advice. Notwithstanding the foregoing, the
responsibility of the Custodian with respect to redemptions effected by check
shall be in accordance with a separate Agreement entered into between the
Custodian and the Fund.
The Custodian shall be liable for the acts or omissions of a foreign
banking institution appointed pursuant to the provisions of Article 3 to the
same extent as set forth in Article 1 hereof with respect to sub-custodians
located in the United States and, regardless of whether assets are maintained in
the custody of a foreign banking institution, a foreign securities depository or
a branch of a U.S. bank as contemplated by paragraph 3.11 hereof, the Custodian
shall not be liable for any loss, damage, cost, expense, liability or claim
resulting from or caused by, the direction of or authorization by the Fund to
maintain custody or any securities or cash of the Fund in a foreign country
including, but not limited to, losses resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism.
If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Custodian, result in the Custodian or its nominee assigned to
the Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.
If the Fund requires the Custodian to advance cash or securities for any
purpose or in the event that the Custodian or its nominee shall incur or be
assessed any taxes, charges, expenses, assessments, claims or liabilities in
connection with the performance of this Contract, except such as may arise from
its or its nominee's own negligent action, negligent failure to act or willful
misconduct, any property at any time held for the account of the Fund shall be
security therefor and should the Fund fail to repay the Custodian promptly, the
Custodian shall be entitled to utilize available cash and to dispose of the Fund
assets to the extent necessary to obtain reimbursement.
13. Effective Period, Termination and Amendment
This Contract shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than thirty (30)
days after the date of such delivery or mailing; provided, however that the
Custodian shall not act under Section 2.10 hereof in the absence of receipt of
an initial certificate of the Secretary or an Assistant Secretary that the Board
of Trustees of the Fund has approved the initial use of a particular Securities
System and the receipt of an annual certificate of the Secretary or an Assistant
Secretary that the Board of Trustees has reviewed the use by the Fund of such
Securities System, as required in each case by Rule l7f-4 under the Investment
Company Act of 1940, as amended and that the Custodian shall not act under
Section 2.10A hereof in the absence of receipt of an initial certificate of the
Secretary or an Assistant Secretary that the Board of Trustees has approved the
initial use of the Direct Paper System and the receipt of an annual certificate
of the Secretary or an Assistant Secretary that the Board of Trustees has
reviewed the use by the Fund of the Direct Paper System; provided further,
however, that the Fund shall not amend or terminate this Contract in
contravention of any applicable federal or state regulations, or any provision
of the Declaration of Trust, and further provided, that the Fund may at any time
by action of its Board of Trustees (i) substitute another bank or trust company
for the Custodian by giving notice as described above to the Custodian, or (ii)
immediately terminate this Contract in the event of the appointment of a
conservator or receiver for the Custodian by the Comptroller of the Currency or
upon the happening of a like event at the direction of an appropriate regulatory
agency or court of competent jurisdiction;
Upon termination of the Contract, the Fund shall pay to the Custodian such
compensation as may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements.
14. Successor Custodian
If a successor custodian shall be appointed by the Board of Trustees of the
Fund, the Custodian shall, upon termination, deliver to such successor custodian
at the office of the Custodian, duly endorsed and in the form for transfer, all
securities then held by it hereunder and shall transfer to an account of the
successor custodian all of the Fund's securities held in a Securities System.
If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Board of Trustees
of the Fund, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
properties held by the Custodian and all instruments held by the Custodian
relative thereto and all other property held by it under this Contract and to
transfer to an account of such successor custodian a11 of the Fund's securities
held in any Securities System. Thereafter, such bank or trust company shall be
the successor of the Custodian under this Contract.
In the event that securities, funds and other properties retain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or of
the Board of Trustees to appoint a successor custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall retain in full force and effect.
l5. Interpretive and Additional Provisions
In connection with the operation of this Contract, the Custodian and the
Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such interpretive or
additional provisions shall be in writing signed by both parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
the Declaration of Trust of the Fund. No interpretive or additional provisions
made as provided in the preceding sentence shall be deemed to be an amendment of
this Contract.
l6. Massachusetts Law to Apply
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of the Commonwealth of Massachusetts.
17. Prior Contracts
This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Fund and the Custodian relating to the custody of the
Fund's assets.
18. Limitations of Liability of the Trustees and Shareholders
A copy of this Agreement and Declaration of Trust of the Trust is on file
with the State of New York, and notice is hereby given that this instrument is
executed on behalf of the Trustees of the Trust as Trustees and not individually
and that the obligations of this instrument are not binding upon any of the
Trustees or Shareholders individually but are binding only upon the assets and
property of the Fund.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 13th day of Dec., 1989.
ATTEST CASH RESERVES PORTFOLIO
/s/ Molly S. Mugler By /s/ Philip Coolidge
- ----------------------------------- -------------------------------
ATTEST STATE STREET BANK AND TRUST COMPANY
/s/ Peggy McClure By /s/ Robert F. Dame
- ----------------------------------- ------------------------------
Assistant Secretary Vice President
<PAGE>
EXHIBIT NO. 9(a)
TRANSFER AGENCY AND SERVICE AGREEMENT
between
CASH RESERVES PORTFOLIO
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
Article 1 Terms of Appointment; Duties of the Bank........................ l
Article 2 Fees and Expenses............................................... 5
Article 3 Representations and Warranties of the Bank...................... 6
Article 4 Representations and Warranties of the Fund...................... 6
Article 5 Indemnification................................................. 7
Article 6 Covenants of the Fund and the Bank.............................. 10
Article 7 Termination of Agreement........................................ ll
Article 8 Assignnent...................................................... 12
Article 9 Amendment....................................................... 12
Article 10 Massachusetts Law to Apply...................................... 13
Article 11 Merger of Agreement............................................. 13
Article 12 Limitations of Liability of the Trustees and the Shareholders... 13
Article 13 Counterparts.................................................... 13
<PAGE>
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 13th day of December, 1989, by and between CASH
RESERVES PORTFOLIO, a New York trust, having its principal office and place of
business at 6 St. James Avenue, Boston, Massachusetts (the "Fund"), and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts trust company having its
principal office and place of business at 225 Franklin Street, Boston,
Massachusetts 02110 (the "Bank").
WHEREAS, the Fund desires to appoint the Bank as its transfer agent,
dividend disbursing agent, custodian of certain retirement plans and agent in
connection with certain other activities, and the Bank desires to accept such
appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
Article 1 Terms of Appointment; Duties of the Bank
1.01 Subject to the terms and conditions set forth in this Agreement, the
Fund hereby employs and appoints the Bank to act as, and the Bank agrees to act
as its transfer agent for the Fund's authorized and issued shares of its
beneficial interest ("Shares"), dividend disbursing agent, custodian of certain
retirement plans and agent in connection with any accumulation, open-account or
similar plans provided to the shareholders of the Fund ("Shareholders") and set
out in the currently effective prospectus and statement of additional
information ("prospectus") of the Fund, including without limitation any
periodic investment plan or periodic withdrawal program.
1.02 The Bank agrees that it will perform the following services:
(a) In accordance with procedures established from time to time by
agreement between the Fund and the Bank, the Bank shall:
(i) Receive for acceptance, orders for the purchase of Shares, and
promptly deliver payment and appropriate documentation thereof to
the Custodian of the Fund authorized pursuant to the Declaration of
Trust of the Fund (the "Custodian");
(ii) Pursuant to purchase orders, issue the appropriate number of Shares
and hold such Shares in the appropriate Shareholder account;
(iii) Receive for acceptance redemption requests and redemption directions
and deliver the appropriate documentation thereof to the Custodian;
(iv) In respect to the transactions in items (i), (ii) and (iii) above,
the Bank shall execute transactions directly with broker-dealers
authorized by the Fund who shall thereby be deemed to be acting on
behalf of the Fund;
(v) At the appropriate time as and when it receives monies paid to it by
the Custodian with respect to any redemption, pay over or cause to
be paid over in the appropriate manner such monies as instructed by
the redeeming Shareholders;
(vi) Effect transfers of Shares by the registered owners thereof upon
receipt of appropriate instructions;
(vii) Prepare and transmit payments for dividends and distributions
declared by the Fund;
(viii) Issue replacement certificates for those certificates alleged to
have been lost, stolen or destroyed upon receipt by the Bank of
indemnification satisfactory to the Bank and protecting the Bank and
the Fund, and the Bank at its option, may issue replacement
certificates in place of mutilated stock certificates upon
presentation thereof and without such indemnity;
(ix) Report abandoned property to the various states as authorized by the
Fund per policies and principles agreed upon by the Fund and the
Bank;
(x) Maintain records of account for and advise the Fund and its
Shareholders as to the foregoing; and
(xi) Record the issuance of shares of the Fund and maintain pursuant to
SEC Rule 17Ad-10(e) a record of the total number of shares of the
Fund which are authorized, based upon data provided to it by the
Fund, and issued and outstanding. The Bank shall also provide the
Fund on a regular basis with the total number of shares which are
authorized and issued and outstanding and shall have no obligation,
when recording the issuance of shares, to monitor the issuance of
such shares or to take cognizance of any laws relating to the issue
or sale of such shares, which functions shall be the sole
responsibility of the Fund
(b) In addition to and neither in lieu nor in contravention of the services
set forth in the above paragraph (a), the Bank shall: (i) perform the customary
services of a transfer agent, dividend disbursing agent, custodian of certain
retirement plans and, as relevant, agent in connection with accumulation,
open-account or similar plans (including without limitation any periodic
investment plan or periodic withdrawal program), including but not limited to:
maintaining all Shareholder accounts, preparing Shareholder meeting lists,
mailing proxies, receiving and tabulating proxies, mailing Shareholder reports
and prospectuses to current Shareholders, withholding taxes on U.S. resident and
non-resident alien accounts, preparing and filing U.S. Treasury Department Forms
1099 and other appropriate forms required with respect to dividends and
distributions by federal authorities for all Shareholders, preparing and mailing
confirmation forms and statements of account to Shareholders for all purchases
and redemptions of Shares and other confirmable transactions in Shareholder
accounts, preparing and mailing activity statements for Shareholders, and
providing Shareholder account information and (ii) provide a systems which will
enable the Fund to monitor the total number of Shares sold in each State.
(c) In addition, the Fund shall (i) identify to the Bank in writing those
transactions and assets to be treated as exempt from blue sky reporting for each
State and (ii) verify the establishment of transactions for each State on the
system prior to activation and thereafter monitor the daily activity for each
State. The responsibility of the Bank for the Fund's blue sky State registration
status is solely limited to the initial establishment of transactions subject to
blue sky compliance by the Fund and the reporting of such transactions to the
Fund as provided above.
(d) Procedures as to who shall provide certain of these services in Article
1 may be established from time to time by agreement between the Fund and the
Bank per the attached service responsibility schedule. The Bank may at times
perform only a portion of these services and the Fund or its agent may perform
these services on the Fund's behalf.
Article 2 Fees and Expenses
2.01 For performance by the Bank pursuant to this Agreement, the Fund
agrees to pay the Bank an annual maintenance fee for each Shareholder account as
set out in the initial fee schedule attached hereto. Such fees and out-of-pocket
expenses and advances identified under Section 2.02 below may be changed from
time to time subject to mutual written agreement between the Fund and the Bank.
2.02 In addition to the fee paid under Section 2.01 above, the Fund agrees
to reimburse the Bank for out-of-pocket expenses or advances incurred by the
Bank for the items set out in the fee schedule attached hereto. In addition, any
other expenses incurred by the Bank at the request or with the consent of the
Fund, will be reimbursed by the Fund.
2.03 The Fund agrees to pay all fees and reimbursable expenses within five
days following the receipt of the respective billing notice. Postage for mailing
of dividends, proxies, Fund reports and other mailings to all shareholder
accounts shall be advanced to the Bank by the Fund at least seven (7) days prior
to the mailing date of such materials.
Article 3 Representations and Warranties of the Bank
The Bank represents and warrants to the Fund that:
3.01 It is a trust company duly organized and existing and in good standing
under the laws of the Commonwealth of Massachusetts.
3.02 It is duly qualified to carry on its business in the Commonwealth of
Massachusetts.
3.03 It is empowered under applicable laws and by its Charter and By-Laws
to enter into and perform this Agreement.
3.04 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
3.05 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
Article 4 Representations and Warranties of the Fund
The Fund represents and warrants to the Bank that:
4.01 It is a business trust duly organized and existing and in good
standing under the laws of the State of New York.
4.02 It is empowered under applicable laws and by its Declaration of Trust
and By-Laws to enter into and perform this Agreement.
4.03 All proceedings required by said Declaration of Trust and By-Laws have
been taken to authorize it to enter into and perform this Agreement.
4.04 It is an open-end and diversified management investment company
registered under the Investment Company Act of 1940, as amended.
4.05 A registration statement under the Securities Act of 1933, as amended
is currently effective and will remain effective, and appropriate state
securities law filings have been made and will continue to be made, with respect
to all Shares of the Fund being offered for sale.
Article 5 Indemnification
5.01 The Bank shall not be responsible for, and the Fund shall indemnify
and hold the Bank harmless from and against, any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liability arising out of or
attributable to:
(a) All actions of the Bank or its agent or subcontractors required to be
taken pursuant to this Agreement, provided that such actions are taken in good
faith and without negligence or willful misconduct.
(b) The Fund's lack of good faith, negligence or willful misconduct which
arise out of the breach of any representation or warranty of the Fund hereunder.
(c) The reliance on or use by the Bank or its agents or subcontractors of
information, records and documents or services which (i) are received or relied
upon by the Bank or its agents or subcontractors and/or furnished to it or
performed by or on behalf of the Fund, and (ii) have been prepared, maintained
and/or performed by the Fund or any other person or firm on behalf of the Fund.
(d) The reliance on, or the carrying out by the Bank or its agents or
subcontractors of any instructions or requests of the Fund.
(e) The offer or sale of Shares in violation of any requirement under the
federal securities laws or regulations or the securities laws or regulations of
any state that such Shares be registered in such state or in violation of any
stop order or other determination or ruling by any federal agency or any state
with respect to the offer or sale of such Shares in such state.
5.02 The Bank shall indemnify and hold the Fund harmless from and against
any and all losses, damages, costs, charges, counsel fees, payments, expenses
and liability arising out of or attributable to any action or failure or
omission to act by the Bank as a result of the Bank's lack of good faith,
negligence or willful misconduct.
5.03 At any time the Bank may apply to any officer of the Fund for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by the Bank under this
Agreement, and the Bank and its agents or subcontractors shall not be liable and
shall be indemnified by the Fund for any action taken or omitted by it in
reliance upon such instructions or upon the opinion of such counsel. The Bank,
its agents and subcontractors shall be protected and indemnified in acting upon
any paper or document furnished by or on behalf of the Fund, reasonably believed
to be genuine and to have been signed by the proper person or persons, or upon
any instruction, information, data, records or documents provided the Bank or
its agents or subcontractors by machine readable input, telex, CRT data entry or
other similar means authorized by the Fund, and shall not be held to have notice
of any change of authority of any person, until receipt of written notice
thereof from the Fund. The Bank, its agents and subcontractors shall also be
protected and indemnified in recognizing stock certificates which are reasonably
believed to bear the proper manual or facsimile signatures of the officers of
the Fund, and the proper countersignature of any former transfer agent or former
registrar, or of a co-transfer agent or co-registrar.
5.04 In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable for damages to the
other for any damages resulting from such failure to perform or otherwise from
such causes.
5.05 Neither party to this Agreement shall be liable to the other party for
consequential damages under any provision of this Agreement or for any
consequential damages arising out of any act or failure to act hereunder.
5.06 In order that the indemnification provisions contained in this Article
5 shall apply, upon the assertion of a claim for which either party may be
required to indemnify the other, the party seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option to participate with the
party seeking indemnification in the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in
any case in which the other party may be required to indemnify it except with
the other party's prior written consent.
Article 6 Covenants of the Fund and the Bank
6.01 The Fund shall promptly furnish to the Bank the following:
(a) A certified copy of the resolution of the Board of Trustees of the Fund
authorizing the appointment of the Bank and the execution and delivery of this
Agreement.
(b) A copy of the Declaration of Trust and By-Laws of the Fund and all
amendments thereto.
6.02 The Bank hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account of, such certificates,
forms and devices.
6.03 The Bank shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the extent
required by Section 31 of the Investment Company Act of 1940, as amended, and
the Rules thereunder, the Bank agrees that all such records prepared or
maintained by the Bank relating to the services to be performed by the Bank
hereunder are the property of the Fund and will be preserved, maintained and
made available in accordance with such Section and Rules, and will be
surrendered promptly to the Fund on and in accordance with its request.
6.04 The Bank and the Fund agree that all books, records, information and
data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of this Agreement shall
remain confidential, and shall not be voluntarily disclosed to any other person,
except as may be required by law.
6.05 In case of any requests or demands for the inspection of the
Shareholder records of the Fund, the Bank will endeavor to notify the Fund and
to secure instructions from an authorized officer of the Fund as to such
inspection The Bank reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by its counsel that it may be held
liable for the failure to exhibit the Shareholder records to such person.
Article 7 Termination of Agreement
7.01 This Agreement may be terminated by either party upon one hundred
twenty (120) days written notice to the other.
7.02 Should the Fund exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Fund. Additionally, the Bank reserves the right to charge for any other
reasonable expenses associated with such termination and/or a charge equivalent
to the average of three (3) months' fees.
Article 8 Assignment
8.01 Except as provided in Section 8.03 below, neither this Agreement nor
any rights or obligations hereunder may be assigned by either party without the
written consent of the other party.
8.02 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
8.03 The Bank may, without further consent on the part of the Fund,
subcontract for the performance hereof with (i) Boston Financial Data Services,
Inc., a Massachusetts corporation ("BFDS") which is duly registered as a
transfer agent pursuant to Section 17A(c)(l) of the Securities Exchange Act of
1934, as amended ("Section 17A(c)(l)"), (ii) a BFDS subsidiary duly registered
as a transfer agent pursuant to Section 17A(c)(1) or (iii) a BFDS affiliate;
provided, however, that the Bank shall be as fully responsible to the Fund for
the acts and omissions of any subcontractor as it is for its own acts and
omissions.
Article 9 Amendment
9.01 This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the Board
of Trustees of the Fund.
Article 10 Massachusetts Law to Apply
10.01 This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts.
Article 11 Merger of Agreement
11.01 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether oral or written.
Article 12 Limitations of Liability of the Trustees and Shareholders
12.01 A copy of this Agreement and Declaration of Trust of the Trust is on
file with the State of New York, and notice is hereby given that this instrument
is executed on behalf of the Trustees of the Trust as Trustees and not
individually and that the obligations of this instrument are not binding upon
any of the Trustees or Shareholders individually but are binding only upon the
assets and property of the Fund.
Article 13 Counterparts
13.01 This Agreement may be executed by the parties hereto on any number of
counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
CASH RESERVES PORTFOLIO
BY: /s/ Philip Coolidge
-----------------------------
Philip Coolidge
ATTEST:
/s/ Molly S. Mugler
- -------------------------------
Molly S. Mugler
STATE STREET BANK AND TRUST COMPANY
BY: /s/ Robert F. Dame
-----------------------------
Vice President
ATTEST:
/s/ Peggy McClure
- -------------------------------
Assistant Secretary
<PAGE>
EXHIBIT NO. 9(b)
AMENDED AND RESTATED
ADMINISTRATIVE SERVICES PLAN
ADMINISTRATIVE SERVICES PLAN, dated as of September 13, 1989, and
amended and restated as of September 1, 1993, of Cash Reserves Portfolio, a New
York trust (the "Portfolio").
WITNESSETH:
WHEREAS, the Portfolio is engaged in business as an open-end management
investment company and is registered under the Investment Company Act of 1940
(collectively with the rules and regulations promulgated thereunder, the "1940
Act"); and
WHEREAS, the Portfolio desires to adopt this Amended and Restated
Administrative Services Plan (the "Plan") in order to provide for certain
administrative services to the Portfolio and holders of its Beneficial Interests
(the "Interests"); and
WHEREAS, the Portfolio desires to enter into a transfer agency
agreement (in such form as may from time to time be approved by the Board of
Trustees of the Portfolio (the "Transfer Agency Agreement")) with a financial
institution, as transfer agent for the Portfolio (the "Transfer Agent"), whereby
the Transfer Agent will provide transfer agency services to the Portfolio; and
WHEREAS, the Portfolio desires to enter into a custodian agreement (in
such form as may from time to time be approved by the Board of Trustees of the
Portfolio (the "Custodian Agreement")) with a financial institution, as
custodian for the Portfolio (the "Custodian"), whereby the Custodian will
provide custodial services to the Portfolio; and
WHEREAS, the Portfolio desires to enter into an administrative services
agreement (in such form as may from time to time be approved by the Board of
Trustees of the Portfolio (the "Administrative Services Agreement")) with
Signature Financial Group (Cayman), Ltd., a Cayman Islands company, as
administrator of the Portfolio (the "Administrator"), whereby the Administrator
will provide certain administrative and management services to the Portfolio;
and
WHEREAS, the Board of Trustees of the Portfolio, in considering whether
the Portfolio should adopt and implement this Plan, has evaluated such
information as it deemed necessary to an informed determination as to whether
this Plan should be adopted and implemented and has considered such pertinent
factors as it deemed necessary to form the basis for a decision to use assets of
the Portfolio for such purposes, and has determined that there is a reasonable
likelihood that the adoption and implementation of this Plan will benefit the
Portfolio and the holders of its Interests.
NOW, THEREFORE, the Board of Trustees of the Portfolio hereby adopts
this Plan for the Portfolio, on the following terms and conditions:
1. As specified in the Transfer Agency Agreement, the Transfer
Agent shall act as dividend disbursing agent for the Portfolio and
perform other transfer agency functions for the Portfolio. The
Portfolio shall pay to the Transfer Agent such compensation as may from
time to time be agreed to by the Portfolio and the Transfer Agent.
2. As specified in the Custodian Agreement, the Custodian shall
safeguard and control the Portfolio's cash and securities, handle
receipt and delivery of securities for the Portfolio, determine income
and collect interest on the Portfolio's investments, maintain books of
original entry for Portfolio accounting and other required books and
accounts, calculate the daily net asset value of, and net income on,
the Interests and, in general, act as the custodian of the Portfolio's
assets, but the Custodian shall have no power to determine the
investment policies of the Portfolio or to determine which securities
the Portfolio will buy or sell. The Portfolio shall pay to the
Custodian such compensation as may from time to time be agreed to by
the Portfolio and the Custodian.
3. As specified in the Administrative Services Agreement, the
Administrator shall perform certain administrative and management
services on behalf of the Portfolio, including, but not necessarily
limited to: providing office space, equipment and clerical personnel
necessary for maintaining the organization of the Portfolio and for
providing the administrative and management services to be performed by
the Administrator; arranging, if desired by the Portfolio, for
Directors, officers and employees of the Administrator to serve as
Trustees, officers or agents of the Portfolio if duly elected or
appointed to such positions and subject to their individual consent and
to any limitations imposed by law; supervising the overall
administration of the Portfolio, including negotiation of contracts and
fees with and the monitoring of performance and billings of the
Portfolio's Transfer Agent, Custodian and other independent contractors
or agents; preparing and, if applicable, filing all documents required
for compliance by the Portfolio with applicable laws and regulations,
including registration statements, semi-annual and annual reports to
the Portfolio's investors, proxy statements and tax returns;
preparation of agendas and supporting documents for and minutes of
meetings of Trustees, committees of Trustees and the Portfolio's
investors; arranging for computation of performance statistics with
respect to the Portfolio and arranging for maintenance of books and
records of the Portfolio. The Administrator shall perform such
specified activities and shall conduct all of its activities as
administrator of the Portfolio, including any activities described
above or in the Administrative Services Agreement, as set forth in the
Operating Policies and Procedures (the "Operating Procedures") of the
Portfolio (in such form as may be approved from time to time by the
Portfolio's Board of Trustees). To the extent that any provision of the
Administrative Services Agreement shall conflict with any provision of
the Operating Procedures, the applicable provision of the Operating
Procedures shall be deemed to govern. As consideration for services
performed under the Administrative Services Agreement, the Portfolio
shall periodically pay to the Administrator a fee at an annual rate of
0.05% of the Portfolio's average daily net assets for its then-current
fiscal year.
4. Nothing herein contained shall be deemed to require the
Portfolio to take any action contrary to its Declaration of Trust or
By-Laws or any applicable statutory or regulatory requirement to which
it is subject or by which it is bound, or to relieve or deprive the
Board of Trustees of the Portfolio of the responsibility for and
control of the conduct of the affairs of the Portfolio.
5. This Plan shall become effective upon (a) approval by a vote of
at least a "majority of the outstanding voting securities" of the
Portfolio, and (b) approval by a vote of the Board of Trustees of the
Portfolio and vote of a majority of the Trustees who are not
"interested persons" of the Portfolio and who have no direct or
indirect financial interest in the operation of the Plan or in any of
the agreements related to the Plan (the "Qualified Trustees"), such
votes to be cast in person at a meeting called for the purpose of
voting on this Plan.
6. This Plan shall continue in effect indefinitely, provided that
such continuance is subject to annual approval by a vote of the Board
of Trustees of the Portfolio and a majority of the Qualified Trustees,
such votes to be cast in person at a meeting called for the purpose of
voting on continuance of this Plan. If such annual approval is not
obtained, this Plan shall expire on the date which is 15 months after
the date of the last approval.
7. This Plan may be amended at any time by the Board of Trustees
of the Portfolio, provided that (a) any amendment to increase
materially the amount to be spent for the services described herein
shall be effective only upon approval by a vote of a "majority of the
outstanding voting securities" of the Portfolio, and (b) any material
amendment of this Plan shall be effective only upon approval by a vote
of the Board of Trustees of the Portfolio and a majority of the
Qualified Trustees, such votes to be cast in person at a meeting called
for the purpose of voting on such amendment. This Plan may be
terminated at any time by vote of a majority of the Qualified Trustees
or by a vote of a "majority of the outstanding voting securities" of
the Portfolio.
8. The Treasurer of the Portfolio shall provide the Board of
Trustees of the Portfolio, and the Board of Trustees of the Portfolio
shall review, at least quarterly, a written report of the amounts
expended under the Plan and the purposes for which such expenditures
were made.
9. While this Plan is in effect, the selection and nomination of
Qualified Trustees shall be committed to the discretion of the Trustees
who are not "interested persons" of the Portfolio.
10. For the purposes of this Plan, the terms "interested person"
and "majority of the outstanding voting securities" are used as defined
in the 1940 Act. In addition, for purposes of determining the fees
payable to the Administrator, the value of a Portfolio's net assets
shall be computed in the manner specified in the Portfolio's
then-current Registration Statement under the 1940 Act.
11. The Portfolio shall preserve copies of this Plan, and each
agreement related hereto and each report referred to in paragraph 8
hereof (collectively the "Records"), for a period of six years from the
end of the fiscal year in which such Record was made and each such
Record shall be kept in an easily accessible place for the first two
years of said record-keeping.
12. This Plan shall be construed in accordance with the laws of
the State of New York and the applicable provisions of the 1940 Act.
13. If any provision of this Plan shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
<PAGE>
EXHIBIT NO. 9(c)
ADMINISTRATIVE SERVICES AGREEMENT
ADMINISTRATIVE SERVICES AGREEMENT, dated as of September 1, 1993, by and
between CASH RESERVES PORTFOLIO, a New York business trust (the "Trust"), and
SIGNATURE FINANCIAL GROUP (GRAND CAYMAN), LTD., a Cayman Islands company (the
"Administrator").
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940 (collectively with the rules
and regulations promulgated thereunder, the "1940 Act");
WHEREAS, the Board of Trustees of the Trust has adopted an Administrative
Services Plan, dated as of September 13, 1989, as amended and restated as of
September 1, 1993, which is incorporated herein by reference and pursuant to
which the Trust desires to enter into this Administrative Services Agreement;
and
WHEREAS, the Trust wishes to engage the Administrator to provide certain
administrative and management services, and the Administrator is willing to
provide such administrative and management services to the Trust, on the terms
and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Duties of the Administrator. Subject to the direction and
control of the Board of Trustees of the Trust, the Administrator shall
perform such administrative and management services as may from time to
time be reasonably requested by the Trust, which shall include without
limitation: (a) providing office space, equipment and clerical
personnel necessary for maintaining the organization of the Trust and
for performing the administrative and management functions herein set
forth; (b) arranging, if desired by the Trust, for Directors, officers
and employees of the Administrator to serve as Trustees, officers or
agents of the Trust if duly elected or appointed to such positions and
subject to their individual consent and to any limitations imposed by
law; (c) supervising the overall administration of the Trust, including
negotiation of contracts and fees with and the monitoring of
performance and billings of the Trust's transfer agent, shareholder
servicing agents, custodian and other independent contractors or
agents; (d) preparing and, if applicable, filing all documents required
for compliance by the Trust with applicable laws and regulations,
including registration statements, semi-annual and annual reports to
the Trust's investors, proxy statements and tax returns; (e)
preparation of agendas and supporting documents for and minutes of
meetings of Trustees, committees of Trustees and the Trust's investors;
and (f) arranging for maintenance of books and records of the Trust.
The Administrator shall perform such specified activities and shall
conduct all of its activities as administrator of the Trust, including
any activities described in this Agreement, as set forth in the
Operating Policies and Procedures (the "Operating Procedures") of the
Trust (in such form as may be approved from time to time by the Trust's
Board of Trustees). To the extent that any provision of this Agreement
shall conflict with any provision of the Operating Procedures, the
applicable provision of the Operating Procedures shall be deemed to
govern. Notwithstanding the foregoing, the Administrator shall not be
deemed to have assumed any duties with respect to, and shall not be
responsible for, the management of the Trust's assets or the rendering
of investment advice and supervision with respect thereto or the
distribution of shares, nor shall the Administrator be deemed to have
assumed or have any responsibility with respect to functions
specifically assumed by any transfer agent, custodian or shareholder
servicing agent of the Trust.
2. Allocation of Charges and Expenses. The Administrator shall pay
the entire salaries and wages of all of the Trust's Trustees, officers
and agents who devote part or all of their time to the affairs of the
Administrator or its affiliates, and the wages and salaries of such
persons shall not be deemed to be expenses incurred by the Trust for
purposes of this Section 2. Except as provided in the foregoing
sentence, the Trust will pay all of its own expenses including, without
limitation, compensation of Trustees not affiliated with the
Administrator; governmental fees; interest charges; taxes; membership
dues in the Investment Company Institute allocable to the Trust; fees
and expenses of the Trust's independent auditors, of legal counsel and
of any transfer agent, distributor, registrar or dividend disbursing
agent of the Trust; expenses of preparing, printing and mailing
reports, notices, proxy statements and reports to the Trust's investors
and governmental officers and commissions; expenses connected with the
execution, recording and settlement of security transactions; insurance
premiums; fees and expenses of the Trust's custodian for all services
to the Trust, including safekeeping of funds and securities and
maintaining required books and accounts; expenses of calculating the
net asset value of shares of the Trust; expenses of meetings of
investors in the Trust; and expenses relating to the issuance,
registration and qualification of shares of the Trust.
3. Compensation of the Administrator. For the services to be
rendered and the facilities to be provided by the Administrator
hereunder, the Trust shall pay to the Administrator an administrative
fee computed and paid monthly at an annual rate of 0.05% of the Trust's
average daily net assets for its then-current fiscal year. If the
Administrator serves as administrator for less than the whole of any
period specified in this Section 3, the compensation to the
Administrator, shall be prorated. For purposes of computing the fees
payable to the Administrator hereunder, the value of the Trust's net
assets shall be computed in the manner specified in the Trust's
then-current Registration Statement under the 1940 Act.
4. Limitation of Liability of the Administrator. The Administrator
shall not be liable for any error of judgment or mistake of law or for
any act or omission in the administration or management of the Trust or
the performance of its duties hereunder, except for willful
misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of the reckless disregard of its obligations and
duties hereunder. As used in this Section 4, the term "Administrator"
shall include Signature Financial Group (Cayman), Ltd. and/or any of
its affiliates and the Directors, officers and employees of Signature
Financial Group (Cayman), Ltd. and/or any of its affiliates.
5. Activities of the Administrator. The services of the
Administrator to the Trust are not to be deemed to be exclusive, the
Administrator being free to render administrative and/or other services
to other parties. It is understood that Trustees, officers, and
shareholders of the Trust are or may become interested in the
Administrator and/or any of its affiliates, as Directors, officers,
employees, or otherwise, and that Directors, officers and employees of
the Administrator and/or any of its affiliates are or may become
similarly interested in the Trust and that the Administrator and/or any
of its affiliates may be or become interested in the Trust as an
investor or otherwise.
6. Subcontracting by the Administrator. The Administrator may
subcontract for the performance of the Administrator' obligations
hereunder with any one or more persons; provided, however, that the
Administrator shall not enter into any such subcontract unless the
Trustees of the Trust shall have found the subcontracting party to be
qualified to perform the obligations sought to be subcontracted; and
provided, further, that, unless the Trust otherwise expressly agrees in
writing, the Administrator shall be as fully responsible to the Trust
for the acts and omissions of any subcontractor as it would be for its
own acts or omissions.
7. Duration, Termination and Amendments of this Agreement. This
Agreement shall become effective as of the day and year first above
written and shall govern the relations between the parties hereto
thereafter, and shall remain in force until August 31, 1995 on which
date it will terminate unless its continuance after August 31, 1995 is
"specifically approved at least annually" (a) by the vote of a majority
of the Board of Trustees of the Trust who are not "interested persons"
of the Trust or of the Administrator at a meeting specifically called
for the purpose of voting on such approval, and (b) by the Board of
Trustees of the Trust or by the "vote of a majority of the outstanding
voting securities" of the Trust as to which this Agreement is to
continue.
This Agreement may be terminated at any time, without the payment of any
penalty, by the Board of Trustees of the Trust or by the "vote of a majority of
the outstanding voting securities" of the Trust, or by the Administrator, in
each case on not more than 60 days' nor less than 30 days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
"assignment".
The terms "specifically approved at least annually", "vote of a majority of
the outstanding voting securities", "assignment", and "interested persons", when
used in this Agreement, shall have the respective meanings specified in, and
shall be construed in a manner consistent with, the 1940 Act, subject, however,
to such exemptions as may be granted by the Securities and Exchange Commission
under said Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered at a location or locations outside the United States in
their names and on their behalf by the undersigned, thereunto duly authorized,
all as of the day and year first above written. The undersigned Trustee of the
Trust has executed this Agreement not individually, but as Trustee under the
Trust's Declaration of Trust, dated October 11, 1989, as amended, and the
obligations of this Agreement are not binding upon any of the Trustees or
shareholders of the Trust individually, but bind only the Trust estate.
CASH RESERVES PORTFOLIO SIGNATURE FINANCIAL GROUP
(GRAND CAYMAN), LTD.
By: Philip Coolidge By: Philip Coolidge
- --------------------------- --------------------------
Title: Trustree and President Title: Chief Executive Officer
<PAGE>
EXHIBIT 9(d)
SUB-ADMINISTRATIVE SERVICES AGREEMENT
SUB-ADMINISTRATIVE SERVICES AGREEMENT, dated as of May 1, 1994, by and
between SIGNATURE FINANCIAL GROUP (GRAND CAYMAN) LTD. a Cayman Islands Company
("SFGC" or the "Administrator"), and CITIBANK, N.A., a national banking
association ("Citibank" or the "Sub-Administrator").
WITNESSETH:
WHEREAS, SFGC, or an affiliate company, has entered into an Administrative
Services Agreement (the "Administrative Agreement") with Cash Reserves Portfolio
(the "Trust"); and
WHEREAS, as permitted by Section 6 of the Administrative Agreement, Citibank
desires to subcontract some or all of the performance of the Administrator's
obligations thereunder to Citibank, and Citibank desires to accept such
obligations; and
WHEREAS, SFGC or an affiliate company, wishes to engage Citibank to provide
certain administrative services on the terms and conditions hereinafter set
forth, so long as the Trustees of the Landmark Funds shall have found Citibank
to be qualified to perform the obligations sought to be subcontracted.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herin set forth, the parties covenant and agree as
follows:
1. Duties of the Sub-Administrator. The Sub-Administrator shall perform such
administrative and management services as may from time to time be agreed
to between the Administrator and the Sub-Administrator so long as the
Trustees of the Landmark Funds shall have found the Sub-Administrator to
be qualified to perform the obligations sought to be subcontracted, which
may include (a) providing office space, equipment and clerical personnel
necessary for maintaining the organization of the Landmarak Funds and for
performing the administrative functions herein set forth; (b)
participation in the preparation of documents required for compliance by
the Landmark Funds with applicable laws and regulations, including
registration statements, prospectuses, semi-annual and annual reports to
shareholders, proxy statements and tax returns; (c) preparation of
agendas and supporting documents for and minutes of meetings of the
Trustees, Committees of Trustees and shareholders; (d) arranging for
maintenance of books and records of the Landmark Funds; and (e) any other
functions or obligations permitted to or required by the Administrator.
Notwithstanding the foregoing, the Sub-Administrator under this Agreement
shall not be deemed to have assumed any duties with respect to, and shall
not be responsible for, the management of the Trust, or the distribution
of Shares of Beneficial Interest of the Trust ("Shares"), nor shall the
Sub-Administrator be deemed to have assumed or have any responsibility
with respect to functions specifically assumed by any transfer agent,
custodian or shareholder servicing agent of the Trust.
2. Compensation of Sub-Administrator. For the services to be rendered and
the facilities to be provided by the Sub-Administrator hereunder, the
Sub-Administrator shall be paid an administrative fee as may from time to
time be agreed to between the Administrator and the Sub-Administrator.
3. Additional Terms and Conditions. The parties may amend this agreement and
include such other terms and conditions as may from time to time be
agreed to between the Administrator and the Sub-Administrator, so long as
the Trustees of the Trust shall have found the subcontracting party to be
qualified to perform the obligations sought to be subcontracted.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
SIGNATURE FINANCIAL GROUP (GRAND CAYMAN) LTD.
By: /s/ Philip Coolidge
----------------------------
Title: Chief Executive Officer
----------------------------
CITIBANK, N.A.
By: /s/ Robert P. Wallace
----------------------------
Title: Vice President
----------------------------
<PAGE>
EXHIBIT 11
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in Part B constituting part
of this Amendment No.11 to the registration statement on Form N-1A (the
"Registration Statement") of Cash Reserves Portfolio of our report dated October
9, 1996, relating to the August 31, 1996 financial statements and financial
highlights of the Cash Reserves Portfolio, which are also incorporated by
reference into the Registration Statement. We also consent to the reference to
us under the heading "Investment Advisory and Other Services" in Part B of the
Registration Statement.
Price Waterhouse
Chartered Accountants
Toronto, Ontario
December 27, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000850615
<NAME> CASH RESERVES PORTFOLIO
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1996
<PERIOD-END> AUG-31-1996
<INVESTMENTS-AT-COST> 4,396,287,498
<INVESTMENTS-AT-VALUE> 4,396,287,498
<RECEIVABLES> 46,416,814
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 889
<TOTAL-ASSETS> 4,442,705,201
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<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 517,909
<TOTAL-LIABILITIES> 517,909
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<PER-SHARE-NAV-BEGIN> 0.00
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<AVG-DEBT-PER-SHARE> 0
</TABLE>
