1933 Act File No. 33-
---------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-14
REGISTRATION STATEMENT, UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No.
Post-Effective Amendment No.
MONEY MARKET OBLIGATIONS TRUST
(Exact Name of Registrant as Specified in Charter)
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire,
Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
It is proposed that this filing will become effective on October 15, 1996, or as
soon thereafter as is practicable, pursuant to Rule 488.
Registrant has filed with the Securities and Exchange Commission a declaration
pursuant to Rule 24f-2 under the Investment Company Act of 1940, and:
filed the Notice required by that Rule on ; or
------------------
X intends to file the Notice required by that Rule on or about September
16, 1996, or
during the most recent fiscal year did not sell any securities
pursuant to Rule 24f-2 under the Investment Company Act of 1940, and, pursuant
to Rule 24f-2(b)(2), need not file the Notice.
Copies to:
Matthew G. Maloney, Esquire
Dickstein, Shapiro, Morin & Oshinsky LLP
2101 L Street, N.W.
Washington, D.C. 20037
CROSS REFERENCE SHEET
CROSS REFERENCE SHEET
Item of Part A Located in
of Form N-14 Prospectus
1 Cross Reference Sheet; Cover Page.
2 Table of Contents.
3 Summary; Comparison of Investment
Policies and Risk Factors.
4 Information About the Reorganization.
5 Information About the Portfolio and the
Fund.
6 Information About the Portfolio and the
Fund.
7 Voting Information.
8 Summary; Information About the
Reorganization.
9 Not Applicable.
Item of Part B Located in Statement of
Of Form N-14 Additional Informatin
10 Cover Page.
11 Table of Contents.
12 Statemenet of Additional Information of
Treasury Obligations Fund dated
September 30, 1996.
13 Not Applicable.
14 Prospectus of Tax-Free Obligations Fund
dated September 30, 1996; Financial
Statements of Treasury Instruments Money
Market Fund II, a portfolio of Lehman
Brothers Institutional Funds Group
Trust.
LEHMAN BROTHERS INSTITUTIONAL FUNDS GROUP TRUST
TREASURY INSTRUMENTS MONEY MARKET FUND II
One Exchange P lace
53 State Street
Boston, Massachusetts 02109-2873
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO SHAREHOLDERS OF TREASURY INSTRUMENTS MONEY MARKET FUND II, A PORTFOLIO
OF LEHMAN BROTHERS INSTITUTIONAL FUNDS GROUP TRUST: A Special Meeting of
Shareholders of Treasury Instruments Money Market Fund II (the "Fund") will be
held at p.m. on , 1996, at One Exchange Place, 53 State
------ -------------
Street, Boston, Massachusetts 02109-2873, for the following purposes:
To approve a proposed Agreement and Plan of Reorganization between Lehman
Brothers Institutional Funds Group Trust, on behalf of the Fund, and Money
Market Obligations Trust (the "Trust"), on behalf of its portfolio, Treasury
Obligations Fund (the "Portfolio"), whereby the Trust would acquire all of the
assets and known liabilities of the Fund in exchange for Institutional Shares
and Institutional Service Shares of the Portfolio to be distributed pro rata by
the Fund to holders of Class A Shares and Class B Shares, respectively, in
complete liquidation of the Fund;
2. Election of thirteen Trustees to serve until the next Annual Meeting
of Shareholders and until their successors have been elected and qualified; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
By Order of the Board of Trustees
Patricia L. Bickimer
Secretary
Dated
Shareholders of record at the close of business on
, 1996 are entitled to vote at the meeting. Whether or
- ----------------------
not you plan to attend the meeting, please sign and return the enclosed proxy
card. Your vote is important.
To secure the largest possible representation and to save the expense
of further mailings, please mark your proxy card, sign it, and return it in the
enclosed envelope, which requires no postage if mailed in the United States.
You may revoke your proxy at any time at or before the meeting or vote in person
if you attend the meeting.
1
PROSPECTUS/PROXY STATEMENT
, 1996
----------------
Acquisition of the assets of
TREASURY INSTRUMENTS MONEY MARKET FUND II,
a Portfolio of Lehman Brothers Institutional Funds Group Trust
61 Accord Drive
Norwell, Massachusetts 02061
Telephone Number: 1-800-851-3134
By and in exchange for shares of
TREASURY OBLIGATIONS FUND,
a Portfolio of Money Market Obligations Trust
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Telephone Number: 1-800-245-5000
This Prospectus/Proxy Statement describes the proposed Agreement and Plan
of Reorganization (the "Plan") whereby Money Market Obligations Trust, a
Massachusetts business trust (the "Trust"), on behalf of its portfolio, Treasury
Obligations Fund (the "Portfolio"), would acquire all of the assets and known
liabilities of Treasury Instruments Money Market Fund II (the "Fund"), a
portfolio of Lehman Brothers Institutional Funds Group Trust, in exchange for
Portfolio shares to be distributed pro rata by the Fund to its shareholders in
complete liquidation of the Fund. As a result of the Plan, each shareholder of
the Fund will become the owner of Portfolio shares having a total net asset
value equal to the total net asset value of his or her holdings in the Fund.
This Prospectus/Proxy Statement also describes a proposal to elect Trustees of
Lehman Brothers Institutional Funds Group Trust, in connection with certain
related transactions.
The Trust is among over 100 funds managed by subsidiaries of Federated
Investors, including 48 money market funds with assets of $43 billion.
Federated Investors is one of the largest institutional service providers in the
United States. It has been providing advisory services for over 41 years and
has been managing the short-term assets of institutional investors for over 20
years, having created one of the first institutional money market funds in 1976.
The Trust is an open-end, diversified management investment company which
currently includes six portfolios: Automated Cash Management Trust, Treasury
Obligations Fund, Government Obligations Tax Managed Fund, Prime Obligations
Fund, Tax-Free Obligations Fund and Treasury Obligations Fund. The investment
objective of the Portfolio is current income consistent with stability of
principal. The investment objective of the Fund is current income with
liquidity and security of principal. The Portfolio and the Fund pursue their
investment objectives by investing primarily in short-term U.S. Treasury
securities and repurchase agreements. Both the Portfolio and the Fund are money
market mutual funds which seek to stabilize their offering and redemption prices
at $1.00 per share. There can be no assurance that the Portfolio or the Fund
will be able to do so. Shares in the Portfolio and the Fund are not insured or
guaranteed by the U.S. government or any agency thereof. For a comparison of
the investment policies of the Portfolio and the Fund, see "Comparison of
Investment Policies and Risk Factors."
The Portfolio is offered with two classes of shares: Institutional Shares
and Institutional Service Shares. Holders of Class A Shares of the Fund will
receive Institutional Shares of the Portfolio and holders of Class B Shares of
the Fund will receive Institutional Service Shares of the Portfolio if the
Reorganization is approved by shareholders. Information concerning
Institutional Shares and Institutional Service Shares of the Portfolio, as
compared to Class A Shares and Class B Shares of the Fund, is included in this
Prospectus/Proxy Statement in the sections entitled "SUMMARY - Comparative Fee
Tables" and "INFORMATION ABOUT THE REORGANIZATION - Description of the Plan of
Reorganization."
This Prospectus/Proxy Statement should be retained for future reference.
It sets forth concisely the information about the Trust and the Portfolio that a
prospective investor should know before investing. This Prospectus/Proxy
Statement is accompanied by the Prospectus of the Portfolio dated September 30,
1996, which is incorporated herein by reference. Statements of Additional
Information for the Portfolio dated September 30, 1996 (relating to the
Portfolio's prospectus of the same date) and , 1996
----------------------
(relating to this Prospectus/Proxy Statement) containing additional information
have been filed by the Trust with the Securities and Exchange Commission and are
incorporated herein by reference. Copies of the Statements of Additional
Information may be obtained without charge by writing or by calling the Trust at
the address and telephone number shown above.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS/PROXY STATEMENT
AND IN THE MATERIALS EXPRESSLY INCORPORATED HEREIN BY REFERENCE AND, IF GIVEN OR
MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE FUND OR THE PORTFOLIO.
SHARES OF THE PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK. SHARES OF THE PORTFOLIO ARE NOT FEDERALLY INSURED BY,
GUARANTEED BY, OBLIGATIONS OF OR OTHERWISE SUPPORTED BY THE U.S. GOVERNMENT, THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. AN INVESTMENT IN THE PORTFOLIO INVOLVES INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED. THERE IS NO ASSURANCE
THAT THE PORTFOLIO WILL BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00
PER SHARE.
TABLE OF CONTENTS
Page
PROPOSAL 1. REORGANIZATION 1
SUMMARY 1
COMPARISON OF INVESTMENT POLICIES AND RISK FACTORS 5
INFORMATION ABOUT THE REORGANIZATION 6
INFORMATION ABOUT THE PORTFOLIO AND THE FUND 10
PROPOSAL 2. ELECTION OF TRUSTEES 11
VOTING INFORMATION 15
AGREEMENT AND PLAN OF REORGANIZATION Exhibit A
PROPOSAL 1. REORGANIZATION
SUMMARY
About the Proposed Reorganization
The Board of Trustees of Lehman Brothers Institutional Funds Group Trust,
including its members who are not "interested persons" within the meaning of the
Investment Company Act of 1940, as amended (the "1940 Act"), on behalf of one of
its portfolios, Treasury Instruments Money Market Fund II (the "Fund"), has
i
voted to recommend to shareholders of the Fund the approval of an Agreement and
Plan of Reorganization (the "Plan"), whereby Money Market Obligations Trust, a
Massachusetts business trust (the "Trust"), on behalf of its portfolio, Treasury
Obligations Fund (the "Portfolio"), would acquire all of the assets and known
liabilities of the Fund in exchange for Portfolio shares to be distributed pro
rata by the Fund to its shareholders in complete liquidation and dissolution of
the Fund (the "Reorganization"). As a result of the Reorganization, each
shareholder of Class A Shares or Class B Shares of the Fund will become the
owner of Institutional Shares or Institutional Service Shares, respectively, of
the Portfolio having a total net asset value equal to the total net asset value
of his or her holdings in the Fund on the date of the Reorganization (the
"Closing Date").
The Reorganization is undertaken as part of a business agreement by and
between Federated Investors and Lehman Brothers Global Asset Management, Inc.
("Lehman") pursuant to which Lehman has entered into a non-compete agreement
whereby Lehman will discontinue advising money market funds, subject to certain
conditions. Following the transactions, Lehman will assist Federated Investors
in providing services to shareholders for which Lehman will receive fees paid by
Federated Investors and/or mutual funds in which the shareholders are invested.
As a condition to the Reorganization transactions, the Trust and the Fund
will receive an opinion of counsel that the Reorganization will be considered a
tax-free "reorganization" under applicable provisions of the Internal Revenue
Code of 1986, as amended, so that no gain or loss will be recognized by either
the Trust or the Fund or their respective shareholders. The tax cost basis of
the Portfolio shares received by Fund shareholders will be the same as the tax
cost-basis of their shares in the Fund.
After the acquisition is completed, the Fund will no longer be available as
an investment portfolio of Lehman Brothers Institutional Funds Group Trust.
Investment Objective and Policies
The investment objective of the Portfolio is to provide current income with
stability of principal while the Fund's investment objective is to provide
current income with liquidity and security of principal. Both the Portfolio and
the Fund pursue their respective investment objectives by investing in a
portfolio consisting of short-term U.S. Treasury bills, notes and other
obligations issued or guaranteed by the U.S. Government and repurchase
agreements relating to such obligations. Since the Portfolio and the Fund
invest in similar securities, an investment in the Portfolio presents similar
investment risks as investing in the Fund.
Advisory Fees and Expense Ratios
The maximum annual investment advisory fee for the Portfolio is 0.20% of
average daily net assets. The maximum annual investment advisory fee for the
Fund is also 0.20% of average daily net assets.
For its fiscal year ended July 31, 1996, the Portfolio's ratio of expenses
to average daily net assets was 0.20% for Institutional Shares and 0.45% for
Institutional Service Shares. During this period the Portfolio's investment
adviser, Federated Management ("Federated"), voluntarily waived a portion of its
management fees and reimbursed the Portfolio for certain operating expenses.
Absent such waiver and reimbursement, the ratio of expenses to average daily net
assets would have been 0.56% for Institutional Shares of the Portfolio and 0.56%
for Institutional Service Shares of the Portfolio. This undertaking to waive
management fees and/or reimburse operating expenses may be terminated by
Federated at any time in its discretion. If the proposals described in this
Prospectus/Proxy Statement are approved by shareholders of the Fund, Federated
has undertaken to waive its fee and/or reimburse the Portfolio's total operating
expenses in excess of .35% and .60% of average daily net assets of Institutional
Shares and Institutional Service Shares, respectively, for a period of two years
following completion of the Reorganization, which is equal to the current
contractual caps on total Fund operating expenses of Class A Shares and Class B
Shares of the Fund.
For its fiscal year ended January 31, 1996, the Fund's ratio of expenses to
average daily net assets was 0.18% for Class A Shares and 0.43% for Class B
Shares. During this period the Fund's investment adviser, Lehman, voluntarily
waived a portion of its management fees and reimbursed the Fund for certain
operating expenses. Absent such waiver and reimbursement, the ratio of expenses
to average daily net assets would have been 0.27% for Class A Shares of the Fund
and 0.52% for Class B Shares of the Fund. This undertaking to waive management
fees and/or reimburse operating expenses may be terminated by Lehman at any time
in its discretion.
Services Providers to the Trust and Portfolio
Administrative services to the Trust and Portfolio are provided by
Federated Administrative Services ("FAS"). FAS is a wholly-owned subsidiary of
Federated Services Company which, in turn, is a wholly-owned subsidiary of
Federated Investors. For its services to the Portfolio, FAS receives as fee at
an annual rate which relates to the average aggregate daily net assets of the
Portfolio, determined as follows: 0.15% on the first $250 million in assets;
0.125% of 1% on the next $250 million in assets; 0.10% of 1% on the next $250
million in assets; and 0.075% of 1% on assets in excess of $750 million. The
minimum annual administrative fee for the Portfolio is $125,000 plus $30,000 per
each additional class of shares. For the fiscal year ended July 31, 1996, FAS
received administrative fees at the effective rate of .08% of the average daily
net assets of the Portfolio.
Federated Services Company ("Federated Services") serves as the Portfolio's
transfer agent and dividend disbursing agent. Federated Services also provides
certain accounting and recordkeeping services with respect to the portfolio
investments of the Portfolio.
Federated Securities Corp. ("FSC"), a wholly-owned subsidiary of Federated
Investors, is the principal distributor of the Trust and Portfolio. Under the
distribution agreement, FSC acts as the Trust's agent in connection with the
offering of shares of the Portfolio.
Comparative Fee Tables
Set forth in the tables below is information regarding the fees and
expenses paid by the separate classes of the Fund and the Portfolio as of July
31, 1996, and pro forma information for the Portfolio assuming that the
Reorganization had taken place on July 31, 1996.
Treasury
Instruments Treasury
Money Obligations Pro Forma
Market Fund II Fund Combined Fund
Class A Shares Institutional Institutional
Shares Shares
ANNUAL FUND OPERATING
EXPENSES
(as a percentage of
average net assets)
Management
Fees/Advisory Fees .10%(1) .09%(1) .09%(1)
(after fee waivers)
12b-1 Fees None None None
Shareholder Services
Fee (after waiver) None .00%(2) .00%(2)
Other Expenses
(after fee waivers
and/or expense .08% .11% .11%
reimbursements)
Total Operating
Expenses (after fee
waivers and/or .18%(3) .20%(4) .20%(4)
expense
reimbursements)
(1) The management fee has been reduced to reflect the voluntary waiver of a
portion of the management fee. The adviser can terminate this voluntary waiver
at any time at its sole discretion. The maximum management fee is .20%.
(2) The maximum shareholder services fee is .25%.
(3) The total operating expenses would have been .35% absent the voluntary
waiver of a portion of the management fee and the reimbursement of certain
expenses.
(4) The total operating expenses would have been .56% absent the voluntary
waiver of a portion of the management fee and the shareholder services fee.
Federated has undertaken to waive its fee and/or reimburse the Portfolio's total
operating expenses in excess of .35% of average daily net assets of the
Portfolio for a period of two years following completion of the Reorganization,
which is equal to the current contractual cap on Class A Shares expenses of the
Fund.
Treasury
Instruments Treasury
Money Obligations Pro Forma
Market Fund II Fund Combined Fund
Class B Shares Institutional Institutional
Service Service
Shares Shares
ANNUAL FUND
OPERATING EXPENSES
Treasury
Instruments Treasury
Money Obligations Pro Forma
Market Fund II Fund Combined Fund
Class B Shares Institutional Institutional
Service Service
Shares Shares
(as a percentage of
average net assets)
Management
Fees/Advisory Fees .10%(1) .09%(1) .09%(1)
(after fee waivers)
12b-1 Fees .25% None None
Shareholder Services
Fee (after waiver) None .25% .25%
Other Expenses
(after fee waivers
and/or expense .08% .11% .11%
reimbursements)
Total Operating
Expenses (after fee
waivers and/or .43%(2) .45%(3) .45%(3)
expense
reimbursements)
(1) The management fee has been reduced to reflect the voluntary waiver of a
portion of the management fee. The adviser can terminate this voluntary waiver
at any time at its sole discretion. The maximum management fee is .20%.
(2) The total operating expenses would have been .60% absent the voluntary
waiver of a portion of the management fee and the reimbursement of certain
expenses.
(3) The total operating expenses would have been .56% absent the voluntary
waiver of a portion of the management fee and the shareholder services fee.
Federated has undertaken to waive its fee and/or reimburse the Portfolio's total
operating expenses in excess of .60% of average daily net assets of the
Portfolio for a period of two years following completion of the Reorganization,
which is equal to the current contractual cap on Class B Shares expenses of the
Fund.
Example: An investor would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return, and (2) redemption at the end of the following
periods:
1 Year 3 Years 5 Years 10 Years
Treasury Instruments Money Market
Fund II
Class A Shares $2 $6 $10 $23
Class B Shares $4 $14 $24 $54
Treasury Obligations Fund
Institutional Shares $2 $6 $11 $26
Institutional Service
Shares $5 $14 $25 $57
Pro Forma Combined
Institutional Shares $2 $6 $11 $26
Institutional Service
Shares $5 $14 $25 $57
As a result of the Reorganization, the expense ratio of the Fund will
increase by .02%, although the contractual advisory fee of Federated Management
is the same as that of Lehman.
Purchase and Redemption Procedures
Procedures for the purchase and redemption of Portfolio shares are similar,
but not identical, to procedures applicable to the purchase and redemption of
Fund shares. In anticipation that the Reorganization will be consummated,
shareholders of the Fund will receive information with respect to the various
services provided by the Portfolio, as well as a detailed explanation of the
options available to shareholders for effecting purchases and redemptions of
Portfolio shares. Any questions about such procedures may be directed to, and
assistance in effecting purchases or redemptions of Portfolio shares may be
obtained from Federated at 1-800-245-5000.
Reference is made to the Prospectuses of the Portfolio dated September 30,
1996, and the Prospectuses of the Fund for a complete description of the
purchase and redemption procedures applicable to purchases and redemptions of
Portfolio and Fund shares, respectively, each of which is incorporated herein by
reference thereto. Set forth below is a brief listing of the more significant
differences between the purchase and redemption procedures of the Portfolio as
compared to the Fund.
The minimum initial investment in the Portfolio is $25,000.00. The minimum
initial investment by an institution in the Lehman Brothers Institutional Funds
Group Trust is $1 million, with not less than $25,000 invested in any one of its
portfolios, including the Fund. The minimum aggregate initial investment by a
high net worth investor in the Lehman Brothers Institutional Funds Group Trust
is $5 million. To meet the minimum investment requirements, purchases of shares
of the Lehman Brothers Institutional Funds Group Trust may be aggregated over a
period of six months.
Both the Portfolio's and the Fund's net asset values are calculated at
12:00 noon (Eastern time), 3:00 p.m. (Eastern time) and 4:00 p.m. (Eastern
time), on each day on which the Portfolio computes its net asset value.
Purchase orders received by either the Portfolio or the Fund by wire before 3:00
p.m. (Eastern time) begin earning dividends that day. Purchase orders received
by check by either the Portfolio or the Fund begin earning dividends the day
after such check is converted into federal funds, which ordinarily occurs one
day after receipt by State Street Bank and Trust Company, the Portfolio's
custodian (in the case of the Portfolio), or by Boston Safe Deposit and Trust
Company, the Fund's custodian (in the case of the Fund).
Shares of both the Portfolio and the Fund may be redeemed by mail or by
telephone. Shares of the Portfolio and the Fund are redeemed at the net asset
value per share next determined after receiving the redemption order.
COMPARISON OF INVESTMENT POLICIES AND RISK FACTORS
The Portfolio and the Fund have similar investment objectives. The
Portfolio seeks to provide current income consistent with stability of
principal, while the Fund seeks to provide current income with liquidity and
security of principal. Both the Portfolio and the Fund are money market mutual
funds.
Both the Portfolio and the Fund invest in short-term U.S. Treasury
securities which are fully guaranteed as to principal and interest by the United
States. Additionally, each of the Portfolio and the Fund may invest in
repurchase agreements relating to U.S. Treasury securities, provided that no
more than 10% of their respective assets are invested in repurchase agreements
whose terms exceed seven days. For the Fund, only cash, letters of credit, and
securities issued or guaranteed by the U.S. government or its agencies are
acceptable repurchase agreement collateral. The Portfolio and the Fund both
require borrowers to pledge additional collateral if the value of existing
collateral declines. Lending of portfolio securities is permitted by both the
Portfolio and the Fund, provided that each receives collateral equal to at least
100% of the value of securities owned.
For both the Portfolio and the Fund, borrowings, including reverse
repurchase agreements, must not exceed one-third of total assets and may only be
used for temporary purposes. Both the Portfolio and the Fund also impose the
additional restriction that no purchases of securities may be made while
outstanding borrowings exceed 5% of total assets.
Permissible investments of both the Portfolio and the Fund include when-
issued (delayed delivery) securities, although the Portfolio limits such
purchases to no more than 20% of the value of its total assets, while the Fund
limits such purchases to no more than 25% of the value of its total assets,
absent unusual market conditions. The Fund, but not the Portfolio, is also
specifically authorized to invest in Treasury STRIPS with maturities of 13
months or less, zero coupon and capital appreciation bonds, obligations issued
in reliance upon Section 4(2) ("Section 4(2) obligations") of the Securities Act
of 1933, as amended (the "Securities Act") and securities not registered under
the Securities Act, but which can be sold to qualified institutional buyers, so-
called "Rule 144A securities."
The Portfolio's investment objective and policies are more fully described
in its current Prospectus dated September 30, 1995, a copy of which accompanies
this Prospectus/Proxy Statement. The Portfolio's investment objective, as
described in its current Prospectus, may not be changed without the approval of
the Portfolio's shareholders.
The investment restrictions and investment policies of the Portfolio and
the Fund are similar. The significant differences are as follows. Although
neither the Portfolio nor the Fund will knowingly invest more than 10% of its
assets in securities that may be illiquid because of the legal or contractual
restrictions on resale ("restricted securities") or securities for which there
are no readily available market quotations, only the Portfolio requires majority
shareholder approval in order to change the limitation relating to restricted
securities. Even though the Fund is not required to seek shareholder approval
to change its limitation relating to restricted securities, it could not do so
at the present time under interpretations of the Securities and Exchange
Commission. While both the Portfolio and the Fund may not mortgage, pledge or
hypothecate assets, except in connection with borrowing for temporary or
emergency purposes and executing reverse repurchase agreements, the Fund
provides that no more than one-third of the Fund's assets may be so committed.
The Portfolio, by contrast, may pledge assets having a market value not
exceeding the lesser of the dollar amounts borrowed or 15% of the value of the
total assets of the Portfolio at the time of the pledge.
In addition to the Portfolio's and the Fund's shared investment
limitations, the Fund may not invest in warrants. The Portfolio will not invest
in securities of a company for the purpose of exercising control or management.
The Portfolio also will not purchase or retain the securities of any issuer if
the officers or trustees of the Trust or the Portfolio's investment adviser,
owning more than 1/2 of 1% of the issuer's securities, together own more than 5%
of the issuer's securities. Furthermore, the Portfolio will not purchase or
sell interests in oil, gas, or other mineral exploration or development programs
or leases, although it may purchase the securities of issuers which invest or
sponsor such programs.
Reference is hereby made to the Portfolio's Statement of Additional
Information dated September 30, 1996, and the Fund's Statement of Additional
Information dated May 30, 1996, for a complete description of the investment
practices and restrictions of the Portfolio and the Fund. Copies of such
Statements are available upon request at no charge. See `Information About the
Portfolio and the Fund.''
INFORMATION ABOUT THE REORGANIZATION
Background and Reasons for the Proposed Acquisition
The Fund commenced operations on February 8, 1993, in order to provide
institutional and high net worth individuals (through Class A Shares) and
institutions purchasing on behalf of individuals (through Class B Shares) with
an investment vehicle which provided current income with liquidity and security
of principal. Federated Securities Corp. (`FSC''), the distributor of shares
of the Portfolio, has proposed to representatives of the Fund that the Fund
consider a sale of all of the Fund's assets to the Trust, acting on behalf of
the Portfolio.
In considering the proposed Reorganization, the Board took into
consideration a number of factors, including (1) the comparatively larger size
of the Portfolio, (2) the capabilities and resources of Federated, (3) expense
ratios and published information regarding the fees and expenses of the
Portfolio in relation to similar funds, (4) the comparative investment
performance of the Portfolio and the Fund as well as the performance of similar
funds, (5) the terms and conditions of the Reorganization and whether the
Reorganization would result in the dilution of shareholder interests, (6) the
tax consequences of the Reorganization, (7) the compatibility of the Portfolio's
and the Fund's investment objectives, policies, restrictions and portfolios, as
well as service features available to shareholders in the respective funds, (8)
the commitment of Federated to maintain and enhance its position in the money
fund business and (9) the decision by Lehman to seek to discontinue managing
money market funds.
The Board concluded to recommend that the shareholders of the Portfolio
vote to approve the Reorganization. This conclusion was based on a number of
factors, including the following:
1. The Reorganization would permit the shareholders of the Fund to pursue
substantially the same investment goals in a larger fund. A larger fund should
enhance the ability of portfolio managers to effect their portfolio transactions
on more favorable terms and give portfolio managers greater investment
flexibility and the ability to select a larger number of portfolio securities,
with the attendant ability to spread investment risks over a larger number of
portfolio issues. In addition, the larger aggregate net assets should enable
the Portfolio to obtain the benefits of economies of scale.
2. The Reorganization would secure for the shareholders of the Fund the
investment advisory services of Federated. Federated manages over 100 mutual
funds, including 48 money market funds with assets of $43 billion. It is one of
the largest institutional service providers in the United States. Federated has
been providing advisory services for over 41 years and has been managing the
short-term assets of institutional investors for over 20 years, having created
one of the first institutional money market funds in 1976.
3. As stated above, the contractual fees for investment advice payable to
Federated are the same as those for the Fund. The actual expense ratio for the
Portfolio for its most recent fiscal year was .02% higher than that for the Fund
for its most recent fiscal year. The differential in expense ratios between the
Portfolio and the Fund is due to the differing waivers of fees by the advisers
to the Portfolio and the Fund, which waivers were done on a voluntary basis and
could have been terminated by the relevant adviser at any time. Federated has
undertaken to cap the Portfolio's total operating expense ratio after the
Reorganization at .20% which could be changed at any time. Federated has
agreed, however, for the two-year period following the Reorganization to cap the
Portfolio's expense ratio (other than the Shareholder Services Fee applicable to
Institutional Service Shares) at .35%, which is equal to the current contractual
cap on Class A expenses of the Fund.
4. The seven-day net yields of the Insitutional Shares and Institutional
Service Shares of the Portfolio for the seven-day period ended July 31, 1996
were 5.17% and 4.92%, respectively. The seven-day net yields of the Class A
Shares and Class B Shares of the Fund for the seven-day period ended July 31,
1996 were 5.04% and 4.79%, respectively. Over other periods the performance of
the Portfolio and the Fund in relation to each other have varied, in part due to
differing expense waivers by Federated and Lehman. The Portfolio has
consistently performed in the top [quintile] of institutional money market funds
of the same type during the past year.
Description of the Plan of Reorganization
The Plan provides that the Trust, on behalf of the Portfolio, will acquire
all of the assets and known liabilities of the Fund in exchange for
Institutional Shares and Institutional Service Shares of Portfolio to be
distributed pro rata by the Fund to the holders of Class A Shares and Class B
Shares, respectively, in complete liquidation of the Fund on or about November
8, 1996. Because both the Portfolio and the Fund seek to maintain a constant
net asset value of $1.00 per share, it is expected that Fund shareholders will
receive the same number of shares in the Portfolio as they held in the Fund
immediately prior to the Closing. Shareholders of the Fund will become
shareholders of the Portfolio as of 12:00 Noon (Eastern time) on the Closing
Date and will begin accruing dividends as of such day. Shareholders of the Fund
will earn their last dividend from the Fund on the day preceding the Closing
Date, which Closing Date is expected to be November 8, 1996.
Consummation of the Reorganization is subject to the conditions set forth
in the Plan, including receipt of an opinion in form and substance satisfactory
to Lehman Brothers Institutional Funds Group Trust, on behalf of the Fund, and
the Trust, on behalf of the Portfolio, as described under the caption `Federal
Income Tax Consequences''below. The Plan may be terminated and the
Reorganization may be abandoned at any time before or after approval by
shareholders of the Fund prior to the Closing Date by either party if it
believes that consummation of the Reorganization would not be in the best
interests of its shareholders.
Federated is responsible for the payment of all expenses of the
Reorganization, whether or not the Reorganization is consummated. Such expenses
include, but are not limited to, certain legal fees; registration fees; transfer
taxes (if any); the fees of banks and transfer agents; and the costs of
preparing, printing, copying, and mailing proxy solicitation materials to the
Fund's shareholders and the costs of holding the Special Meeting of
Shareholders.
The foregoing description of the Plan entered into between the Trust, on
behalf of the Portfolio, and Lehman Brothers Institutional Funds Group Trust, on
behalf of the Fund, is qualified in its entirety by the terms and provisions of
the Plan, a copy of which is attached hereto as Exhibit A and incorporated
herein by reference.
Description of Portfolio Shares
Shares of the Portfolio to be issued to shareholders of the Fund under the
Plan will be fully paid and nonassessable when issued and transferable without
restrictions and will have no preemptive or conversion rights. Reference is
hereby made to the Prospectus of the Portfolio provided herewith for additional
information about Portfolio shares.
Federal Income Tax Consequences
As a condition to the Reorganization transactions, the Trust, on behalf of
the Portfolio, and Lehman Brothers Institutional Funds Group Trust, on behalf of
the Fund, will receive an opinion from Howard & Howard Attorneys, P.C., to the
effect that, on the basis of the existing provisions of the Internal Revenue
Code of 1986, as amended (the `Code''), current administrative rules and court
decisions, for federal income tax purposes: (1) the Reorganization as set forth
in the Plan will constitute a tax-free reorganization under section 368(a)(1)(C)
of the Code; (2) no gain or loss will be recognized by the Portfolio upon its
receipt of the Fund's assets in exchange for Portfolio shares; (3) the holding
period and basis for the Fund's assets acquired by the Portfolio will be the
same as the holding period and the basis to the Fund immediately prior to the
Reorganization; (4) no gain or loss will recognized by the Fund upon transfer of
its assets to the Portfolio in exchange for Portfolio shares or upon the
distribution of the Portfolio shares to the Fund's shareholders in exchange of
their Fund shares; (5) no gain or loss will be recognized by shareholders of the
Fund upon exchange of their Fund shares for Portfolio shares; (6) the holding
period of Portfolio shares received by shareholders of the Fund pursuant to the
Plan will be the same as the holding period of Fund shares held immediately
prior to the Reorganization, provided the Fund shares were held as capital
assets on the date of the Reorganization; and (7) the basis of Portfolio shares
received by shareholders of the Fund pursuant to the Plan will be the same as
the basis of Fund shares held immediately prior to the Reorganization.
Comparative Information on Shareholder Rights and Obligations
The Trust is organized as a Massachusetts business trust pursuant to a
Declaration of Trust dated October 3, 1988, under the laws of the Commonwealth
of Massachusetts. Lehman Brothers Institutional Funds Group Trust is also
organized as a Massachusetts business trust under a Declaration of Trust dated
November 16, 1992. The rights of shareholders of the Trust and of Lehman
Brothers Institutional Funds Group Trust are similar, although not identical.
Set forth below is a brief summary of the more significant similarities and
differences between rights of shareholders of the Fund and the Portfolio.
Special meetings of both the Fund's and the Portfolio's shareholders may be
called for any purpose on the written request of shareholders entitled to cast
at least ten percent (10%) of all votes entitled to be cast at the meeting.
Special meetings of the Fund's shareholders may also be called at any time by
the Chairman of the Board of Trustees, the President, or upon the request of a
majority of the Trustees of Lehman Brothers Institutional Funds Group Trust.
Special meetings of the Portfolio's shareholders may also be called by the
Trustees or the Chief Executive Officer of the Trust. Shareholders of the
Portfolio are entitled to at least fifteen days' notice of any meeting.
The Declaration of Trust of both Lehman Brothers Institutional Funds Group
Trust and the Trust provide that shareholders shall have the following voting
powers: (i) to vote for the election of Trustees; (ii) to vote with respect to
any investment advisory or sub-advisory contract entered into on behalf of any
series; (iii) to vote to the same extent as shareholders of a Massachusetts
business corporation as to whether or not a court action, proceeding, or claim
should or should not be brought derivatively or as a class action on behalf of
the trust, any series, or the shareholders; and (iv) to vote on such additional
matters as required by the Declaration of Trust, the By-laws, the registration
statement, or the Securities and Exchange Commission.
Shareholders of the Fund, but not of the Portfolio, are also specifically
provided with the following voting rights under the Declaration of Trust: (i)
to vote on the termination of Lehman Brothers Institutional Funds Group Trust or
any of its series; (ii) to vote on any amendment to the Declaration of Trust
that materially affects the rights of shareholders; (iii) to vote with respect
to any merger, consolidation, or sale of assets; (iv) to vote with respect to
the incorporation of Lehman Brothers Institutional Funds Group Trust; and (v) to
vote with respect to the adoption of a plan under Rule 12b-1 of the 1940 Act and
related matters.
Shareholders of the Portfolio, but not of the Fund, are also specifically
provided with the power to vote for the removal of Trustees and with respect to
amendments or supplements to the Trust's Declaration of Trust.
Although there are some differences in the enumerated list of shareholder
voting powers between the Fund and the Portfolio, the 1940 Act and the
Securities and Exchange Commission impose requirements that would eliminate most
of the variations in shareholder rights described above.
Under certain circumstances, shareholders of the Fund or the Portfolio may
be held personally liable as partners under Massachusetts law for acts or
obligations of Lehman Brothers Institutional Funds Group Trust or the Trust,
respectively. To protect shareholders of the Fund and the Portfolio, the
Declarations of Trust expressly disclaim the liability of shareholders for acts
or obligations of the Fund and the Portfolio. The Declarations of Trust provide
that a notice of the disclaimer of liability may be included in each agreement,
obligation, or instrument that either Lehman Brothers Institutional Funds Group
Trust or the Trust may enter into.
In the unlikely event that a shareholder of either the Fund or the
Portfolio is held personally liable for obligations of the Fund or the
Portfolio, the Declarations of Trust provide that property of the Fund or the
Portfolio will be used to protect or compensate the shareholder. On request,
claims are defended and judgments against shareholders are paid that arise out
of any act or obligation of Lehman Brothers Institutional Funds Group Trust or
the Trust on behalf of the Fund or the Portfolio, respectively. Therefore,
financial loss resulting from liability as a shareholder will occur only if
Lehman Brothers Institutional Funds Group Trust or the Trust cannot meet its
obligations to indemnify shareholders and pay judgments against them from the
assets of the Fund or the Portfolio, respectively.
Capitalization
The following table shows the capitalization of the Portfolio and the Fund
as of July 31, 1996, and on a pro forma basis as of that date:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Portfolio Fund Pro Forma Combined
Institutional Institutional Class A Class B Institutional Institutional
Shares Service Shares Shares Shares Shares Service
Shares
Net Assets
$2,182,998 $702,274,358 $111,066,603 $18,393,500 $2,294,065,159 $720,667,858
Price Per Share
$1.00 $1.00 $1.00 $1.00 $1.00 $1.00
</TABLE>
INFORMATION ABOUT THE PORTFOLIO AND THE FUND
Treasury Obligations Fund, a portfolio of Money Market Obligations Trust
Information about the Trust and the Portfolio is contained in the
Portfolio's current Prospectuses for Institutional Shares and Institutional
Service Shares. A copy of either prospectus is included herewith and
incorporated by reference herein. Additional information about the Trust and
the Portfolio is included in the Portfolio's Combined Statement of Additional
Information dated September 30, 1995, which is incorporated herein by reference.
Copies of the Combined Statement of Additional Information, which has been
filed with the Securities and Exchange Commission, may be obtained without
charge by contacting the Trust at 1-800-245-5000 or by writing to the Trust at
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779. The Trust, on
behalf of the Portfolio, is subject to the informational requirements of the
Securities Act, the Securities Exchange Act of 1934, as amended, and the
Investment Company Act of 1940, as amended, and in accordance therewith files
reports and other information with the Securities and Exchange Commission.
Reports, proxy and information statements, and other information filed by the
Trust, on behalf of the Portfolio, can be obtained by calling or writing the
Trust and can also be inspected and copied by the public at the public reference
facilities maintained by the Securities and Exchange Commission in Washington,
D.C. located at Room 1024, 450 Fifth Street, N.W., Washington D.C. 20549 and at
certain of its regional offices located at Room 1204, Everett McKinley Dirksen
Building, 219 South Dearborn Street, Chicago, Illinois 60604 and 14th Floor, 75
Park Place, New York, NY 10007. Copies of such material can be obtained at
prescribed rates from the Public Reference Branch, Office of Consumer Affairs
and Information Services, Securities and Exchange Commission, Washington D.C.
20549.
This Prospectus/Proxy Statement, which constitutes part of a Registration
Statement filed by the Trust, on behalf of the Portfolio, with the Securities
and Exchange Commission under the Securities Act, omits certain of the
information contained in the Registration Statement. Reference is hereby made
to the Registration Statement and to the exhibits thereto for further
information with respect to the Trust, the Portfolio and the shares offered
hereby. Statements contained herein concerning the provisions of documents are
necessarily summaries of such documents, and each such statement is qualified in
its entirety by reference to the copy of the applicable documents filed with the
Securities and Exchange Commission.
Treasury Instruments Money Market Fund II, a portfolio of Lehman Brothers
Institutional Funds Group Trust
Information about the Fund may be found in the Fund's current Prospectuses
dated May 30, 1996, and its Statement of Additional Information dated May 30,
1996, which are incorporated herein by reference. Financial Statements for the
Fund for the year ended January 31, 1996, may be found in the Statement of
Additional Information dated , 1996, relating to this
------------------------
Prospectus/Proxy Statement, which has been filed by the Trust with the
Securities and Exchange Commission. Copies of the Fund's Prospectuses and
Statement of Additional Information may be obtained without charge from the Fund
by calling 1-800-851-3134 or by writing to the Fund at One Exchange Place, 53
State Street, Boston, Massachusetts 02109-2873. A copy of the Statement of
Additional Information relating to this Prospectus/Proxy Statement may be
obtained without charge from Lehman Brothers Institutional Funds Group Trust by
calling or by writing to Lehman Brothers Institutional Funds Group Trust at One
Exchange Place, 53 State Street, Boston, Massachusetts 02109-2873. The Fund is
subject to the information requirements of the Securities Act, the Securities
Exchange Act of 1934, as amended, and the Investment Company Act of 1940, as
amended, and in accordance therewith files reports and other information with
the Securities and Exchange Commission. Reports, proxy and information
statements, and other information filed by the Fund can be obtained by calling
or writing the Fund and can also be inspected at the public reference facilities
maintained by the Securities and Exchange Commission at the addresses listed in
the previous section.
PROPOSAL 2. ELECTION OF TRUSTEES
The Board of Trustees currently consists of six Trustees serving until the
election and qualification of their successors. In connection with the proposed
business agreement between Federated Investors and Lehman described above, it is
proposed that thirteen Trustees be elected to the Board of Lehman Brothers
Institutional Funds Group Trust in connection with the change of the investment
adviser of certain portfolios to Federated Management.None of the current
Trustees will stand for re-election. Three of the nominees are affiliated with
Federated Investors as discussed further below. All of the other nominees are
Trustees or Directors of other investment companies managed by Federated
Management.
Nominees, Trustees and Executive Officers of the Fund
The following is a list of the nominees, Trustees and executive officers of
the Fund. Information provided regarding the name, age, current position with
the Fund and term of office, if any, principal occupation during the past five
years, family relationships and directorships is required by law.
Nominees for Trustees
Name, Age and Relation to Federated Investors
Family Relationships or any of its Subsidiaries
John F. Donahue
Age 71
Father of J. Christopher Donahue,
President of the Trust
Trustee and Chairman of the Board of the
Trust; Chairman and Trustee, Federated
Investors, Federated Advisers, Federated
Management; Chairman and Director,
Federated Research Corp. and Federated
Global Research Corp.; Chairman, Passport
Research Ltd.; Chief Executive Officer
and Director, Trustee or Managing General
Partner of 74 investment companies for
which subsidiaries of Federated Investors
serve as investment adviser,
administrator and/or distributor (the
`Federated Fund Complex'').
Thomas G. Bigley*
Age 61
Trustee of the Trust; Director, Ober
Manufacturing Co.; Chairman of the Board,
Children's Hospital of Pittsburgh;
Director, Trustee, or Managing General
Partner of 74 investment companies within
the Federated Fund Complex; formerly,
Senior Partner Ernst & Young LLP.
John T. Conroy, Jr.*
Age 58 Trustee of the Trust; President,
Investment Properties Corporation; Senior
Vice President, John R. Wood and
Associates, Inc., Realtors; President,
Northgate Village Development
Corporation; Partner or Trustee in
private real estate ventures in Southwest
Florida; Director, Trustee, or Managing
General Partner of 74 investment
companies within the Federated Fund
Complex; formerly, President Naples
Property Management, Inc.
William J. Copeland*
Age 77 Trustee of the Trust; Director and member
of the Executive Committee, Michael
Baker, Inc.; Director, Trustee or
Managing General Partner of 74 investment
companies within the Federated Fund
Complex; formerly, Vice Chairman and
Director, PNC Bank, N.A., and PNC Bank
Corp. and Director, Ryan Homes, Inc.
J. Christopher Donahue
Age 46
Son of John F. Donahue,
Chairman of the Trust Trustee and President of the Trust,
President and Trustee, Federated
Investors, Federated Advisers, Federated
Management and Federated Research;
President and Director, Federated
Research Corp. and Federated Global
Research Corp.; President Passport
Research Ltd.; Trustee, Federated
Administrative Services, Federated
Services Company, and Federated
Shareholder Services; President or
Executive Vice President of the Funds;
Director, Trustee, or Managing General
Partner of certain investment companies
within the Federated Fund Complex.
James E. Dowd*
Age 73 Trustee of the Trust; Attorney-at-law;
Director, The Emerging Germany, Inc.,
Director, Trustee, or Managing General
Partner of 74 investment companies within
the Federated Fund Complex.
Lawrence D. Ellis, M.D.
Age 62 Trustee of the Trust; Professor of
Medicine and Member Board of Trustees,
University of Pittsburgh Medical Center-
Downtown; Member, Board of Directors,
University of Pittsburgh Medical Center;
formerly Hematologist, Oncologist, and
Internist, Presbyertain and Montefiore
Hospitals; Director, Trustee, or Managing
General Partner of 74 investment
companies within the Federated Fund
Complex.
Edward L. Flaherty, Jr.*
Age 71 Trustee of the Trust; Attorney-at-law;
Shareholder, Henny, Kochuba, Meyer and
Flaherty; Director, Eat `N Park
Restaurants, Inc., and Statewide
Settlement Agency, Inc.; Director,
Trustee, or Managing General Partner of
74 investment companies within the
Federated Fund Complex; formerly,
Counsel, Horizon Financial, F.A., Western
Region.
Peter E. Madden*
Age 53 Trustee of the Trust; Consultant; State
Representative, Commonwealth of
Massachusetts; Director, Trustee, or
Managing General Partner of 74 investment
companies within the Federated Fund
Complex; formerly President, State Street
Bank and Trust Company and State Street
Boston Corporation.
Gregor F. Meyer*
Age 68 Trustee of the Trust; Attorney-at-law;
Shareholder, Henny, Kochuba, Meyer and
Flaherty; Chairman, Meritcare, Inc.;
Director, Eat `N Park Restaurants, Inc.;
Director, Trustee or Managing General
Partner of 74 investment companies within
the Federated Fund Complex.
John E. Murray, Jr.*
Age 62 Trustee of the Trust; President and Law
Professor, Duquesne University;
Consulting Partner, Mollica, Murray and
Hogue; Director, Trustee or Managing
General Partner of 74 investment
companies within the Federated Fund
Complex.
Wesley W. Posvar*
Age 70 Trustee of the Trust; Professor,
International Politics and Management
Consultant; Trustee, Carnegie Endowment
for International Peace, RAND
Corporation, Online Computer Library
Center, Inc., and U.S. Space Foundation;
Chairman, Czecho Management Center;
Director, Trustee or Managing General
Partner of 74 investment companies within
the Federated Fund Complex; President
Emeritus, University of Pittsburgh,
founding Chairman, National Advisory
Council for Environmental Policy and
Technology and Federal Emergency
Management Advisory Board.
Marjorie P. Smuts*
Age 60 Trustee of the Trust; Public
relations/marketing consultant;
Conference Coordinator, Non-profit
entities; Director, Trustee, or Managing
General Partner of 74 investment
companies within the Federated Fund
Complex.
The foregoing individuals are being nominated as trustees in connection
with the transaction between Federated Investors and Lehman referred to under
Proposal 1 whereby Federated Management would assume the role of the investment
adviser of certain other portfolios of Lehman Brothers Institutional Funds Group
Trust. If Federated Management becomes the investment adviser to such
portfolios, the Trustees believe that appointing representatives from other
areas within the Federated Investors' organization would help the transition run
smoothly. Furthermore, the Trustees consider the addition of personnel of
Federated Investors to be a means of facilitating day-to-day management of the
Lehman Brothers Institutional Funds Group Trust.
Federated Management has been recommended to assume the role of investment
adviser with respect to three portfolios of Lehman Brothers Institutional Funds
Group Trust, the Prime Money Market Fund, the Prime Value Money Market Fund and
the Municipal Money Market Fund. Also pursuant to that agreement, the assets of
three other portfolios of Lehman Brothers Institutional Funds Group Trust, the
Government Obligations Money Market Fund, Tax-Free Money Market Fund and the
Fund, are proposed to be reorganized into Federated Investors portfolios which
are part of its Money Market Obligations Trust. A third part of the transaction
involves the transfer of assets from Lehman Brothers' retail money market funds
to funds of Federated Investors with similar objectives through a negative
consent process.
Because the Reorganization is part of a business agreement between Lehman
and Federated Investors that includes the election of new Trustees of Lehman
Brothers Institutional Funds Group Trust, and because all shareholders of the
Trust, including those of the Fund, are entitled to elect Trustees of Lehman
Brothers Institutional Funds Group Trust, shareholders of the Fund are asked to
vote for the election of the nominees for Trustee of Lehman Brothers
Institutional Funds Group Trust even though the consummation of the
Reorganization would result in the Fund's shareholders receiving shares of the
Portfolio and becoming shareholders of another entity.
Some of the nominees for election as Trustees are executive officers of and
employed by Federated Investors. To the extent that employees of Federated will
benefit from the entire transaction with Lehman, the nominees may be deemed to
have an indirect material interest in such arrangement. Similarly,
Messrs. Carbone and Gordon, Trustees, and Messrs. Winters and Rabiecki,
Executive Officers, are employees of Lehman Brothers and Lehman, respectively,
and as such may be deemed to have an indirect material interest in the
transaction.
Trustees Not Standing for Election
Name and Age Positions with Registrant and Relation to Federated Investors
Business Experience or any of its Subsidiaries
James A. Carbone, 43 Managing Director, Lehman Brothers None
Andrew Gordon, 42 Co-Chairman of the Board, Trustee and None
President of Lehman Brothers
Institutional Funds Group Trust;
Managing Director, Lehman Brothers
Charles Barber,* 79 Trustee*, Lehman Brothers Institutional None
Funds Group Trust; Retired; former
Chairman of the Board, ASARCO, Inc.
Burt N. Dorsett,* 65 Trustee*, Lehman Brothers Institutional None
Funds Group Trust; Managing Partner,
Dorsett McCabe Capital Management, Inc.,
an investment counseling firm; Director,
Research Corporation Technologies, a
non-profit patent-clearing and licensing
operation; formerly President, Westinghouse
Pension Investments Corporation; formerly
Executive Vice President and Trustee,
College Retirement Equities Fund, Inc., a
variable annuity fund; and formerly
Investment Officer, University of Rochester
Edward J. Kaier,* 50 Trustee*, Lehman Brothers Institutional None
Funds Group Trust; Partner with the law
firm of Hepburn, Willcox, Hamilton & Putnam
S. Donald Wiley,* 69 Trustee*, Lehman Brothers None
Institutional Funds
Group Trust; Vice Chairman and Trustee,
H.J. Heinz Company Foundation
* Independent Trustee
None of the nominees and none of the current Trustees, except Messrs.
Carbone and Gordon, have any material direct or indirect interest in the Fund's
current principal underwriter or administrator. Except as described above,
none of the nominees has any material direct or indirect interest in the
investment adviser or any person controlling, controlled by, or under common
control with the investment adviser.
During the fiscal year ended January 31, 1996, the Trust's Board met four
times. All Trustees attended at least 75 percent of the meetings.
The Trust has a standing Audit Committee which consists of Messrs. Barber,
Dorsett, Kaier and Wiley, all of whom are Independent Trustees. The function of
the Audit Committee is to meet annually with the Trust's independent auditors to
review the financial statements of the Trust's portfolios. The Audit Committee
met one time during the fiscal year ended January 31, 1996.
The Trust also has a Nominating Committee consisting of Messrs. Barber,
Dorsett, Kaier and Wiley. Its function is to nominate independent trustees to
fill vacancies that occur on the Board of Trustees of Lehman Brothers
Institutional Funds Group Trust. The Committee did not meet during the fiscal
year ended January 31, 1996.
Executive Officers
Name and Age Positions with Registrant and Relation to Federated
Investors or any of
its Subsidiaries
John M. Winters, 46 Vice President and Investment None
Officer, Lehman Brothers
Institutional Funds Group Trust;
Investment Officer, Senior Vice
President and Senior Money Market
Portfolio Manager, Lehman Brothers
Global Asset Management, Inc.;
formerly Product Manager with Lehman
Brothers Capital Markets Group
Nicholas Rabiecki III, 39 Vice President and Investment Officer, None
Lehman Brothers Institutional Funds
Group Trust; Vice President and Senior
Portfolio Manager, Lehman Brothers Global
Asset Management, Inc.; formerly Senior
Fixed-Income Portfolio Manager with Chase
Private Banking
Michael C. Kardok, 36 Treasurer, Lehman Brothers Institutional None
Funds Group Trust; Vice President,
First Data Investor Services Group, Inc.;
prior to May 1994, Vice President,
The Boston Company Advisors, Inc.
Patricia L. Bickimer, 42 Secretary, Lehman Brothers Institutional None
Funds Group Trust; Vice President and
Associate General Counsel, First Data
Investor Services Group, Inc.; prior to
May 1994, Vice President and Associate
General Counsel, The Boston Company
Advisors, Inc.
None of the executive officers was selected as such pursuant to any
agreements nor has any executive officer entered into an employment contract or
other compensatory agreement with the Fund.
The Declaration of Trust provides that the Trust 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
Fund unless it is finally adjudicated that they engaged in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in
their offices.
The following table describes the compensation paid during the fiscal year
ending January 31, 1996, to each member of the Board of Trustees of the Trust.
Compensation Table
The following table presents, for the fiscal year ended January 31, 1996,
the compensation paid to, or accrued for, each of the Trust's Trustees. None of
the Fund's most highly compensated executive officers had aggregate compensation
of over $60,000 during this period.
COMPENSATION TABLE
Total
Compensati
Pension or on
Retirement Estimated from Fund
Benefits Annual and Fund
Aggregate Accrued Benefits Complex
Compensation as part of Upon (
---
Name and Position From Fund Fund Retirement Funds)
Expenses Paid to
Directors
James A. Carbone
Trustee and
Co-Chairman of the $0 $0 N/A $0
Board
Andrew Gordon
Trustee, Co-Chairman
of the Board and $0 $0 N/A $0
President
Charles Barber
Trustee $25,000 $0 N/A $25,000
Burt N. Dorsett
Trustee $25,000 $0 N/A $52,500
COMPENSATION TABLE
Total
Compensati
Pension or on
Retirement Estimated from Fund
Benefits Annual and Fund
Aggregate Accrued Benefits Complex
Compensation as part of Upon (Funds
Name and Position From Fund Fund Retirement Paid to
Expenses Directors
Edward J. Kaier
Trustee $25,000 $0 N/A $25,000
S. Donald Wiley
Trustee $25,000 $0 N/A $25,000
The Fund does not have any compensation plans, including pension or
retirement plans or any other defined benefit or actuarial plan in place.
Trustees who are "interested persons" receive no compensation from the Fund
for service as Trustees. Independent Trustees receive $20,000 in retainer fees
per year, plus $1,250 per regular or special Board meeting attended. Trustees
are also reimbursed for travel and out-of-pocket expenses.
VOTING INFORMATION
This Prospectus/Proxy Statement is furnished in connection with the
solicitation by the Board of Trustees of the Fund of proxies for use at the
Special Meeting of Shareholders (the "Meeting") to be held on November 15, 1996
and at any adjournment thereof. The proxy confers discretionary authority on
the persons designated therein to vote on other business not currently
contemplated which may properly come before the Meeting. A proxy, if properly
executed, duly returned, and not revoked, will be voted in accordance with the
specifications thereon; if no instructions are given, such proxy will be voted
in favor of the Plan. A shareholder may revoke a proxy at any time prior to use
by filing with the Secretary of the Fund an instrument revoking the proxy, or by
submitting a proxy bearing a later date, or by attending and voting at the
Meeting.
The cost of the solicitation, including the printing and mailing of proxy
materials, will be borne by Federated. In addition to solicitations through the
mails, proxies may be solicited by officers, employees, and agents of the Fund
and Lehman at no additional costs to the Fund. Such solicitations may be by
telephone, telegraph, or otherwise. Federated will reimburse custodians,
nominees, and fiduciaries for the reasonable costs incurred by them in
connection with forwarding solicitation materials to the beneficial owners of
shares held of record by such persons.
Outstanding Shares and Voting Requirements
The Board of Trustees of the Fund has fixed the close of business on
, 1996, as the record date for the determination of shareholders
- -----------
entitled to notice of and to vote at the Special Meeting of Shareholders and any
adjournment thereof. As of the record, date, there were
-----------------
shares of the Fund outstanding, constituting Class A Shares and
---------------
Class B Shares. Each Fund share is entitled to one vote and
- ----------------
fractional shares have proportionate voting rights. On the record date, [INSERT
5% SHAREHOLDERS AND PERCENTAGE HOLDINGS] On such date, no other person owned of
record, or to the knowledge of Lehman, beneficially owned, 5% or more of the
Fund's outstanding shares. On the record date, the Trustees and officers of the
Fund as a group owned less than 1% of the outstanding shares of the Fund.
On the record date the following persons of record owned 5% or more of the
Portfolio's outstanding shares: [INSERT 5% SHAREHOLDERS AND PERCENTAGE
HOLDINGS] On the record date, the Trustees and officers of the Trust as a group
owned less than 1% of the outstanding shares of the Portfolio.
The votes of shareholders of the Portfolio are not being solicited since
their approval is not required in order to effect the Reorganization.
Approval of Proposal 1, relating to the Reorganization, requires the
affirmative vote of a majority of the Fund's outstanding shares. Approval of
Proposal 2, relating to the election of Trustees, requires the affirmative vote
of a majority of the outstanding shares of Lehman Brothers Institutional Funds
Group Trust and is conditioned upon shareholder approval of Proposal 1. In
determining whether the required vote is obtained, shares of the Fund are voted
in the aggregate, without regard to the designated class of shares of the Fund,
with regard to Proposal 1, and shares of Lehman Brothers Institutional Funds
Group Trust are voted in the aggregate, without regard to the designated series
or class of any shares, with regard to Proposal 2. As used herein, the term
"majority of the Fund's outstanding shares" means the lesser of: (a) 67% of the
shares of the Fund or Lehman Brothers Institutional Funds Group Trust, as the
case may be, present at the Special Meeting if the holders of more than 50% of
the outstanding shares of the Fund, or Lehman Brothers Institutional Funds Group
Trust, as the case may be, are present in person or by proxy, or (b) more than
50% of the outstanding shares of the Fund, or Lehman Brothers Institutional
Funds Group Trust, as the case may be.
In tallying shareholder votes, abstentions and broker non-votes (i.e.,
proxies sent in by brokers and other nominees that cannot be voted on a proposal
because instructions have been received from the beneficial owners) will be
counted for purposes of determining whether or not a quorum is present for
purposes of convening the meeting. On each proposal, broker non-votes will be
considered to be abstentions on the vote regarding each proposal.
No Dissenter's Right of Appraisal
Shareholders of the Fund objecting to the Reorganization have no appraisal
rights under the Fund's Declaration of Trust or under the laws of the
Commonwealth of Massachusetts. Shareholders have the right, however, to redeem
their Fund shares at net asset value until the Closing Date, and thereafter
shareholders may redeem Portfolio shares acquired by them in the Reorganization
at net asset value.
Quorum
In the event that a quorum is not present at the Special Meeting, or in the
event that a quorum is present at the Special Meeting, but sufficient votes to
approve the Plan and the transactions contemplated thereby are not received, the
persons named as proxies may propose one or more adjournments of the Special
Meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of a majority of shares that are represented at the
Meeting in person or by proxy. If a quorum is present, the persons named as
proxies will vote those proxies which they are entitled to vote FOR the Plan in
favor of such adjournments, and will vote those proxies required to be voted
AGAINST such proposal against any adjournment. A quorum is constituted with
respect to the Fund by the presence in person or by proxy of the holders of more
than 50% of the outstanding shares of the Fund entitled to vote at the Meeting.
Proxies properly executed and marked with a negative vote or an abstention will
be considered to be present at the Meeting for purposes of determining the
existence of a quorum for the transaction of business.
Other Matters
Management of the Fund knows of no other matters that may properly be, or
which are likely to be, brought before the meeting. However, if any other
business shall properly come before the meeting the persons named in the proxy
intend to vote thereon in accordance with their best judgment.
So far as management is presently informed, there is no litigation pending
or threatened against the Trust.
Whether or not shareholders expect to attend the meeting, all shareholders
are urged to sign, fill in and return the enclosed proxy form promptly.
AGREEMENT AND PLAN OF REORGANIZATION Exhibit A
AGREEMENT AND PLAN OF REORGANIZATION dated as of September 6, 1996 (the
`Agreement''), by and between MONEY MARKET OBLIGATIONS TRUST, a Massachusetts
business trust, on behalf of its portfolio, Treasury Obligations Fund
(hereinafter called the `Acquiring Fund''), FEDERATED MANAGEMENT, a Delaware
business trust (`Federated''), LEHMAN BROTHERS INSTITUTIONAL FUNDS GROUP TRUST,
a Massachusetts business trust, on behalf of its portfolio, Treasury Instruments
Money Market Fund II (hereinafter called the `Acquired Fund'') and LEHMAN
BROTHERS GLOBAL ASSET MANAGEMENT, INC., a corporation
---------------------
(`Lehman'').
This Agreement is intended to be and is adopted as a plan of reorganization
and liquidation within the meaning of Section 368(a)(1)(C) of the United States
Internal Revenue Code of 1986, as amended (the `Code''). The reorganization
(the `Reorganization'') will consist of the transfer of all of the assets and
known liabilities of the Acquired Fund in exchange solely for Institutional
Shares and Institutional Service Shares of beneficial interest of the Acquiring
Fund (collectively, the `Acquiring Fund Shares'') and the distribution, after
the Closing Date as hereinafter defined, of Institutional Shares and
Institutional Service Shares of the Acquiring Fund to the shareholders of the
Class A Shares and Class B Shares, respectively, of the Acquired Fund in
liquidation of the Acquired Fund as provided herein, all upon the terms and
conditions hereinafter set forth in this Agreement.
WHEREAS, the Acquired Fund and the Acquiring Fund are registered open-end,
diversified, management investment companies and the Acquired Fund owns
securities which generally are assets of the character in which the Acquiring
Fund is permitted to invest;
WHEREAS, the Acquiring Fund is authorized to issue the Acquiring Fund
Shares and the Acquired Fund is authorized to issue its shares of beneficial
interest;
WHEREAS, Federated, an investment adviser registered as such under the
Investment Advisers Act of 1940, as amended, serves as investment adviser to the
Acquiring Fund;
WHEREAS, Lehman, an investment adviser registered as such under the
Investment Advisers Act of 1940, as amended, serves as investment adviser to the
Acquired Fund;
WHEREAS, the Board of Trustees, including a majority of the Trustees who
are not `interested persons'' as defined under the Investment Company Act of
1940, as amended (the `1940 Act'') of the Acquiring Fund has determined that
the exchange of all of the assets and known liabilities of the Acquired Fund for
Acquiring Fund Shares is in the best interests of the Acquiring Fund
shareholders and that the interests of the existing shareholders of the
Acquiring Fund would not be diluted as a result of this transaction; and
WHEREAS, the Board of Trustees, including a majority of the Trustees who
are not `interested persons'' (as defined under the 1940 Act) of the Acquired
Fund has determined that the exchange of all of the assets [and known
liabilities] of the Acquired Fund for Acquiring Fund Shares is in the best
interests of the Acquired Fund shareholders, that the interests of the
shareholders of the Acquired Fund would not be diluted as a result of this
transaction and determined that subsequent to the consummation of the
transaction contemplated by this Agreement, the Acquired Fund will cease
operations;
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements hereinafter set forth, the parties agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR THE ACQUIRING
FUND SHARES AND LIQUIDATION OF THE ACQUIRED FUND.
1.1 Subject to the terms and conditions contained herein, the
Acquired Fund agrees to assign, transfer, and convey to the Acquiring Fund all
of the assets and known liabilities of the Acquired Fund at the time of the
Closing (defined below), including without limitation all securities and cash,
and the Acquiring Fund agrees in exchange therefor to deliver to the Acquired
Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund
Shares, representing Institutional Shares and Institutional Service Shares,
determined as set forth in paragraph 2.3 of this Agreement. Such transactions
shall take place at the closing (the `Closing'') on the closing date (the
`Closing Date''), as provided in paragraph 3.1 of this Agreement. In lieu of
delivering certificates for the Acquiring Fund Shares, the Acquiring Fund shall
credit the Acquiring Fund Shares to the Acquired Fund's account on the stock
record books of the Acquiring Fund's transfer agent and shall deliver a
confirmation thereof to the Acquired Fund.
1.2 The Acquired Fund will discharge all of its liabilities and
obligations prior to the Closing Date.
1.3 Delivery of the assets of the Acquired Fund to be transferred
shall be made on the Closing Date and shall be delivered to State Street Bank
and Trust Company (hereinafter referred to as `State Street''), Boston,
Massachusetts, the Acquiring Fund's custodian (the `Custodian''), for the
account of the Acquiring Fund, together with proper instructions and all
documents necessary to transfer such assets to the account of the Acquiring
Fund, free and clear of all liens, encumbrances, rights, restrictions and
claims, except as may be indicated in a schedule delivered by the Acquired Fund
to the Acquiring Fund immediately prior to the Closing. All cash delivered
shall be in the form of currency or immediately available funds payable to the
order of Custodian for the Acquiring Fund.
1.4 The Acquired Fund will pay or cause to be paid to the Acquiring
Fund any dividends or interest received on or after the Closing Date with
respect to assets transferred to the Acquiring Fund hereunder. The Acquired
Fund will transfer to the Acquiring Fund any distributions, rights, or other
assets received by the Acquired Fund after the Closing Date as distributions on,
or with respect to, the securities transferred. Such assets shall be deemed
included in assets transferred to the Acquiring Fund on the Closing Date and
shall not be separately valued.
1.5 As soon after the Closing Date as is practicable (the
"Liquidation Date"), the Acquired Fund will liquidate and distribute pro rata to
the Acquired Fund's shareholders of record, determined as of the close of
business on the Closing Date (the "Acquired Fund Shareholders"), the Acquiring
Fund Shares received by the Acquired Fund pursuant to paragraph 1.1. Such
liquidation and distribution will be accomplished by the transfer (by the
Acquiring Fund or its transfer agent) of the Acquiring Fund Shares into an
account for each shareholder on the books of the Acquiring Fund's transfer agent
in the name of each Acquired Fund Shareholder and representing the pro rata
number of the Acquiring Fund Shares due each Acquired Fund Shareholder. All
issued and outstanding shares of the Acquired Fund will simultaneously be
canceled on the books of the Acquired Fund. Share certificates representing
interests in the Acquired Fund will represent a number of Acquiring Fund Shares
after the Closing Date as determined in accordance with paragraph 2.3. The
Acquiring Fund will issue certificates representing the Acquiring Fund Shares in
connection with such exchange only for, and upon receipt of, certificated shares
of the Acquired Fund.
1.6 Any transfer taxes payable upon issuance of the Acquiring Fund
Shares in a name other than the registered holder of the Acquired Fund shares on
the books of the Acquired Fund as of the Closing Date shall, as a condition of
such issuance and transfer, be paid by the person to whom such Acquiring Fund
Shares are to be issued and transferred.
1.7 Any reporting responsibility of the Acquired Fund is and shall
remain the responsibility of the Acquired Fund up to and including the Closing
Date and such later dates with respect to dissolution and deregistration of the
Acquired Fund with federal and blue sky authorities.
2. VALUATION.
2.1 The value of the Acquired Fund's assets to be acquired by the
Acquiring Fund hereunder shall be the amortized cost value of such assets
computed as of the close of business on the Closing Date (such time and date
being hereinafter called the "Valuation Date"), using the valuation procedures
set forth in the Acquiring Fund's then-current prospectus or statement of
additional information.
2.2 The net asset value of an Acquiring Fund Share shall be the net
asset value per share computed as of the close of business on the Valuation
Date, using the valuation procedures set forth in the Acquiring Fund's then-
current prospectus or statement of additional information.
2.3 The number of the Acquiring Fund Shares to be issued (including
fractional shares, if any) of the Institutional Shares and the Institutional
Service Shares classes in exchange for the Acquired Fund's assets shall be
determined by dividing the value of the assets attributable to Class A Shares
and Class B Shares of the Acquired Fund determined using the same valuation
procedures referred to in paragraph 2.1 by the net asset value of one Acquiring
Fund Share determined in accordance with paragraph 2.2. Institutional Shares of
the Acquiring Fund shall be issued for Class A Shares of the Acquired Fund and
Institutional Service Shares of the Acquiring Fund shall be issued for Class B
Shares of the Acquired Fund.
2.4 All computations of value shall be made in accordance with the
regular practices of the Acquiring Fund.
3. CLOSING AND CLOSING DATE.
3.1 Closing Date shall be November 8, 1996, or such later date as the
parties may mutually agree. All acts taking place at the Closing Date shall be
deemed to take place simultaneously as of the close of business on the Closing
Date unless otherwise provided. The Closing shall be held at the close of
business at the offices of the Acquired Fund, One Exchange Place, 53 State
Street, Boston, Massachusetts 02109, or such other time and/or place as the
parties may mutually agree.
3.2 If on the Valuation Date: (a) the primary trading market for
portfolio securities of the Acquiring Fund or the Acquired Fund shall be closed
to trading or trading thereon shall be restricted; or (b) trading or the
reporting of trading shall be disrupted so that accurate appraisal of the value
of the net assets of the Acquiring Fund or the Acquired Fund is impracticable,
the Closing Date shall be postponed until the first business day after the day
when trading shall have been fully resumed and reporting shall have been
restored.
3.3 The Acquired Fund shall instruct First Data Investor Services
Group, Inc., as transfer agent for the Acquired Fund, to deliver to the
Acquiring Fund at the Closing, a certificate of an authorized officer stating
that its records contain the names and addresses of the Acquired Fund
Shareholders and the number of outstanding Class A Shares and Class B Shares
owned by each such shareholder immediately prior to the Closing. The Acquiring
Fund shall issue and deliver a confirmation evidencing the Institutional Shares
and the Institutional Services Shares of the Acquiring Fund to be credited on
the Closing Date to the Secretary of the Acquired Fund or provide evidence
satisfactory to the Acquired Fund that such Institutional Shares and the
Institutional Service Shares of the Acquiring Fund have been credited to the
respective accounts of the Acquired Fund Shareholders on the books of the
Acquiring Fund. At the Closing, each party shall deliver to the other such
bills of sale, checks, assignments, share certificates, if any, receipts or
other documents as such other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES.
4.1 Each of the Acquired Fund and Lehman represents and warrants to
the Acquiring Fund as follows:
(a) The Acquired Fund is a portfolio of a business trust
organized, validly existing, and in good standing under the laws of the
Commonwealth of Massachusetts and has power to carry on its business as it is
now being conducted.
(b) The Acquired Fund is registered under the 1940 Act, as an
open-end, diversified, management investment company, and such registration has
not been revoked or rescinded and is in full force and effect.
(c) The Acquired Fund is not, and the execution, delivery, and
performance of this Agreement will not result, in a material violation of its
Declaration of Trust or By-Laws or of any agreement, indenture, instrument,
contract, lease, or other undertaking to which the Acquired Fund is a party or
by which it is bound.
(d) The Acquired Fund has no contracts or other commitments
outstanding which will result in liability to it after the Closing Date not
reflected on the Acquired Fund's balance sheet other than liabilities in the
ordinary course of business or otherwise disclosed to Federated and the
Acquiring Fund.
(e) No material litigation or administrative proceeding or
investigation of or before any court or governmental body is currently pending
or to its knowledge threatened against the Acquired Fund or any of the Acquired
Fund's properties or assets which, if adversely determined, would materially and
adversely affect its financial condition or the conduct of its business.
Neither Lehman nor the Acquired Fund knows of any facts which might form the
basis for the institution of such proceedings, and the Acquired Fund is not a
party to or subject to the provisions of any order, decree or judgment of any
court or governmental body which materially and adversely affects its business
or its ability to consummate the transactions herein contemplated.
(f) The Statement of Assets and Liabilities of the Acquired Fund
at January 31, 1996, has been audited by Ernst & Young, LLP, independent
auditors, and has been prepared in accordance with generally accepted accounting
principles, consistently applied, and such statement (copies of which have been
furnished to the Acquiring Fund) fairly reflect the financial condition of the
Acquired Fund as of such date, and there are no liabilities of the Acquired
Fund, known to the Acquired Fund or to Lehman, contingent or otherwise, as of
such date not disclosed therein.
(g) The unaudited Statement of Assets and Liabilities of the
Acquired Fund at July 31, 1996, has been prepared in accordance with generally
accepted accounting principles, consistently applied, and on a basis consistent
with the Statement of Assets and Liabilities of the Acquired Fund at January 31,
1996, which has been audited by Ernst & Young, LLP, and such statement (copies
of which have been furnished to the Acquiring Fund) fairly reflects the
financial condition of the Acquired Fund as of such date, and there are no
liabilities of the Acquired Fund known to the Acquired Fund or to Lehman,
contingent or otherwise, as of such date not disclosed therein.
(h) Since January 31, 1996, there has not been any material
adverse change in the Acquired Fund's financial condition, assets, liabilities,
or business other than changes occurring in the ordinary course of business, or
any incurrence by the Acquired Fund of any indebtedness for borrowed money,
except as otherwise disclosed to Federated and the Acquiring Fund.
(i) At the Closing Date, all federal and other tax returns and
reports of the Acquired Fund required by law (or permitted extensions thereto)
to have been filed shall have been filed, and to the best of the Acquired Fund's
knowledge all federal and other taxes shall have been paid so far as due, or
provision shall have been made for the payment thereof, and to the best of the
Acquired Fund's knowledge no such return is currently under audit and no
assessment has been asserted with respect to such returns.
(j) For each fiscal year (or part thereof) of its operation, the
Acquired Fund has met the requirements of Subchapter M of the Code for
qualification and treatment as a regulated investment company.
(k) All issued and outstanding shares of each class of the
Acquired Fund are, and, at the Closing Date will be, duly and validly issued and
outstanding, fully paid and non-assessable. All of the issued and outstanding
shares of each class of the Acquired Fund will, at the time of the Closing, be
held by the persons and in the amounts set forth in the records of the transfer
agent as provided in paragraph 3.3 of this Agreement. The Acquired Fund does
not have outstanding options, warrants or other rights to subscribe for or
purchase any of the Acquired Fund shares, nor is there outstanding any security
convertible into Acquired Fund shares.
(l) On the Closing Date, all issued and outstanding shares of
the Acquired Fund will have been duly registered under the Securities Act of
1933, as amended (the "1933 Act"), and registered, or exempt from registration,
to the extent required thereby under each state securities or "blue sky" law of
every state in which the Acquired Fund has offered or sold its shares.
(m) On the Closing Date, the Acquired Fund will have full right,
power, and authority to sell, assign, transfer, and deliver the assets to be
transferred by it hereunder.
(n) The execution, delivery, and performance of this Agreement
has been duly authorized by all necessary action on the part of the Acquired
Fund's Board of Trustees and, subject to the approval of the Acquired Fund
Shareholders, this Agreement constitutes the valid and legally binding
obligation of the Acquired Fund enforceable in accordance with its terms,
subject to the effect of bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, and other similar laws relating to or affecting
creditors' rights generally and court decisions with respect thereto, and to
general principles of equity and the discretion of the court before which a
proceeding is brought (regardless of whether the enforceability is considered in
a proceeding in equity or at law).
(o) On the effective date of the Registration Statement and on
the Closing Date, the Prospectus/Proxy Statement (only insofar as it relates to
the Acquired Fund) will not contain any 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, in light of the circumstances under which such
statements were made, not misleading.
(p) The Acquired Fund will have provided the Acquiring Fund with
information reasonably necessary for the preparation of the Prospectus/Proxy
Statement.
4.2 Each of Federated and the Acquiring Fund represents and warrants to
the Acquired Fund as follows:
(a) The Acquiring Fund is a business trust duly organized,
validly existing, and in good standing under the laws of the Commonwealth of
Massachusetts and has the power to carry on its business as it is now being
conducted and to carry out this Agreement.
(b) The Acquiring Fund is registered under the 1940 Act as an
open-end, diversified, management investment company, and such registration has
not been revoked or rescinded and is in full force and effect.
(c) The current prospectus and statement of additional
information of the Acquiring Fund conform in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and the rules and
regulation of the SEC thereunder and do not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(d) At the Closing Date, the Acquiring Fund will have good and
marketable title to its assets.
(e) The Acquiring Fund has no material contracts or other
commitments outstanding which will result in liability to it after the Closing
Date not reflected in the Acquiring Fund's balance sheet dated as of July 31,
1996, other than liabilities in the ordinary course of business or otherwise
disclosed to Lehman and the Acquired Fund.
(f) The Acquiring Fund is not, and the execution, delivery, and
performance of this Agreement will not result in violation of its Declaration of
Trust or By-Laws or of any agreement, indenture, instrument, contract, lease, or
other undertaking to which the Acquiring Fund is a party or by which it is
bound.
(g) No litigation or administrative proceeding or investigation
of or before any court or governmental body is currently pending or to its
knowledge threatened against the Acquiring Fund or any of the Acquiring Fund's
properties or assets which, if adversely determined, would affect the Acquiring
Fund's financial condition or the conduct of its business. Neither Federated
nor the Acquiring Fund knows of any facts which might form the basis for the
institution of such proceedings, and the Acquiring Fund is not a party to or
subject to the provisions of any order, decree or judgment of any court or
governmental body which affects its business or its ability to consummate the
transactions contemplated herein.
(h) The Statement of Assets and Liabilities of the Acquiring
Fund at July 31, 1996, has been audited by Arthur Andersen, LLP, independent
auditors, and has been prepared in accordance with generally accepted accounting
principles, consistently applied, and such statement (copies of which have been
furnished to the Acquired Fund) fairly reflects the financial condition of the
Acquiring Fund as of such date, and there are no liabilities of the Acquiring
Fund, contingent or otherwise, as of such date not disclosed therein.
(i) Since July 31, 1996, there has not been any adverse change
in the Acquiring Fund's financial condition, assets, liabilities, or business
other than changes occurring in the ordinary course of business, or any
incurrence by the Acquiring Fund of any indebtedness for borrowed money.
(j) At the Closing Date, all federal and other tax returns and
reports of the Acquiring Fund required by law then to be filed shall have been
filed, and all federal and other taxes shall have been paid so far as due or
provision shall have been made for the payment thereof, and to the best of the
Acquiring Fund's knowledge no such return is currently under audit and no
assessment has been asserted with respect to such returns.
(k) For each fiscal year (or part thereof) of its operation, the
Acquiring Fund has met the requirements of Subchapter M of the Code for
qualification and treatment as a regulated investment company.
(l) All issued and outstanding shares of each class of the
Acquiring Fund are, and including the Acquiring Fund Shares issued to the
Acquired Fund Shareholders pursuant hereto, at the Closing Date will be, duly
and validly issued and outstanding, fully paid and non-assessable. The
Acquiring Fund does not have outstanding any options, warrants or other rights
to subscribe for or purchase any of the Acquiring Fund Shares, nor is there
outstanding any security convertible into any Acquiring Fund Shares.
(m) All issued and outstanding shares of each class of the
Acquiring Fund are, and, including the Acquiring Fund Shares issues to the
Acquired Fund Shareholders pursuant hereto, at the Closing Date will be, duly
registered under the 1933 Act and registered, or exempt from registration, to
the extent required thereby under each state securities or "blue sky" law of
every state in which the Acquiring Fund has offered or sold its shares.
(n) The execution, delivery, and performance of this Agreement
will have been duly authorized prior to the Closing Date by all necessary action
on the part of the Acquiring Fund's Board of Trustees, and this Agreement will
constitute the valid and legally binding obligation of the Acquiring Fund
enforceable in accordance with its terms, subject to the effect of bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and other similar
laws relating to or affecting creditors' rights generally and court decisions
with respect thereto, and to general principles of equity and the discretion of
the court before which a proceeding is brought (regardless of whether the
enforceability is considered in a proceeding in equity or at law).
(o) The Prospectus/Proxy Statement to be included in the
Registration Statement (only insofar as it relates to the Acquiring Fund) will,
on the effective date of the Registration Statement and on the Closing Date be
true and correct in all material respects. Further, on the effective date of
the Registration Statement and on the Closing Date, the Prospectus/Proxy
Statement (only insofar as it relates to the Acquiring Fund) will not contain
any untrue statement of a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which such statements were made, not misleading.
(p) The Acquiring Fund has entered into an agreement under which
Federated will assume the expenses of the Reorganization, including legal fees
of the Acquiring Fund, registration fees, transfer tax (if any), the fees of
banks and transfer agents, and the costs of preparing, printing, copying, and
mailing proxy solicitation materials to the Acquired Fund's shareholders.
5. COVENANTS OF THE ACQUIRING FUND AND THE ACQUIRED FUND.
5.1 The Acquiring Fund and the Acquired Fund each will operate its
business in the ordinary course between the date hereof and the Closing Date, it
being understood that such ordinary course of business will include customary
dividends and distributions.
5.2 The Acquired Fund will call a meeting of the Acquired Fund
Shareholders to consider and act upon this Agreement and to take all other
action necessary and appropriate to obtain approval of the transactions
contemplated herein.
5.3 Subject to the provisions of this Agreement, the Acquiring Fund
and the Acquired Fund will each take, or cause to be taken, all action, and do
or cause to be done, all things reasonably necessary, proper, or advisable to
consummate and make effective the transactions contemplated by this Agreement.
5.4 As promptly as practicable, but in any case within sixty days
after the Closing Date, the Acquired Fund shall furnish the Acquiring Fund, in
such form as is reasonably satisfactory to the Acquiring Fund, a statement of
the earnings and profits of the Acquired Fund for federal income tax purposes
which will be carried over to the Acquiring Fund as a result of Section 381 of
the Code and which will be certified by the Acquired Fund's President or its
Treasurer.
5.5 The Acquiring Fund shall have filed with the SEC a Registration
Statement on Form N-14 complying in all material respects with the requirements
of the 1933 Act, the Securities Exchange Act of 1934, as amended, the 1940 Act,
and applicable rules and regulations thereunder, relating to a meeting of the
shareholders of the Acquired Fund to be called to consider and act upon the
transactions contemplated herein, and such Registration Statement shall have
been declared effective by the SEC. The Acquired Fund agrees to provide the
Acquiring Fund with information relating to the Acquired Fund required under
such Acts, rules and regulations for inclusion in the Registration Statement on
Form N-14.
5.6 For a period of two years after the Closing Date, Federated and
the Acquiring Fund agree to waive fees and/or reimburse expenses in order to
maintain actual expense ratios of the Institutional Shares Class and
Institutional Service Shares Class as follows:
Class Actual Expense Ratio
Institutional Shares Class .35%
Institutional Service Shares Class .60%
5.7 The Acquiring Fund agrees to use all best efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act, and such of
the state Blue Sky or securities laws as it may deem appropriate in order to
continue its operations after the Closing Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND.
The obligations of the Acquiring Fund to complete the transactions provided
for herein shall be subject to the performance by the Acquired Fund of all the
obligations to be performed by it hereunder on or before the Closing Date and,
in addition thereto, the following conditions:
6.1 All representations and warranties of Lehman and the Acquired
Fund contained in this Agreement shall be true and correct in all material
respects as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date with the
same force and effect as if made on and as of the Closing Date.
6.2 The Acquired Fund shall have delivered to the Acquiring Fund a
statement of the Acquired Fund's assets and known liabilities, together with a
list of the Acquired Fund's portfolio securities showing the tax costs of such
securities by lot and the holding periods of such securities, as of the Closing
Date, certified by the Treasurer or the Assistant Treasurer of the Acquired
Fund.
6.3 The Acquired Fund and Lehman shall have delivered to the
Acquiring Fund on the Closing Date a certificate executed in their names by
their respective Presidents or Vice Presidents and their Treasurers or Assistant
Treasurers, in form and substance reasonably satisfactory to the Acquiring Fund,
to the effect that the representations and warranties of the Acquired Fund and
Lehman made in this Agreement are true and correct at and as of the Closing
Date, except as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as the Acquiring Fund shall reasonably
request.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND.
The obligations of the Acquired Fund to consummate the transactions
provided for herein shall be subject to the performance by the Acquiring Fund of
all the obligations to be performed by it hereunder on or before the Closing
Date and, in addition thereto, the following conditions:
7.1 All representations and warranties of the Acquiring Fund and
Federated contained in this Agreement shall be true and correct in all material
respects as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date with the
same force and effect as if made on and as of the Closing Date.
7.2 The Acquiring Fund and Federated shall have delivered to the
Acquired Fund on the Closing Date a certificate executed in their names by their
respective Presidents or Vice Presidents and their Treasurers or Assistant
Treasurers, in form and substance reasonably satisfactory to the Acquired Fund,
to the effect that the representations and warranties of the Acquiring Fund and
Federated made in this Agreement are true and correct at and as of the Closing
Date, except as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as the Acquired Fund shall reasonably
request.
8. FURTHER CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE ACQUIRING FUND AND
THE ACQUIRED FUND.
If any of the conditions set forth below do not exist on or before the
Closing Date with respect to the Acquired Fund or the Acquiring Fund, the other
party to this Agreement shall, at its option, not be required to consummate the
transactions contemplated by this Agreement.
8.1 The Agreement and the transactions contemplated herein shall have
been approved by the requisite vote of the holders of beneficial interest of the
Acquired Fund in accordance with the laws of the Commonwealth of Massachusetts
and the Acquired Fund's Declaration of Trust and By-Laws.
8.2 On the Closing Date no action, suit or other proceeding shall be
pending before any court or governmental agency in which it is sought to
restrain or prohibit, or obtain damages or other relief in connection with, this
Agreement or the transactions contemplated herein.
8.3 All consents of parties hereto and all other consents, orders,
permits, and exemptions of federal, state, and local regulatory authorities
(including those of the Securities and Exchange Commission and of state Blue Sky
and securities authorities) deemed necessary by the Acquiring Fund or the
Acquired Fund to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except where failure
to obtain any such consent, order, or permit would not involve a risk of a
material adverse effect on the assets or properties of the Acquiring Fund or the
Acquired Fund, provided that either party hereto may for itself waive any of
such conditions.
8.4 Reserved.
8.5 The Form N-14 shall have become effective under the 1933 Act by
the SEC and no stop orders suspending the effectiveness thereof shall have been
issued and, to the best knowledge of the parties hereto, no investigation or
proceeding for that purpose shall have been instituted or be pending,
threatened, or contemplated under the 1933 Act.
8.6 The Acquiring Fund and the Acquired Fund shall have received an
opinion of Howard & Howard Attorneys, P.C., substantially to the effect that, on
the basis of the existing provisions of the Code, current administrative rules,
and court decisions, for federal income tax purposes:
(a) The transfer of all or substantially all of the Acquired
Fund assets in exchange for the Acquiring Fund Shares and the distribution of
the Acquiring Fund Shares to the shareholders of the Acquired Fund in
liquidation of the Acquired Fund will constitute a "reorganization" within the
meaning of Section 368(a)(1)(C) of the Code; (b) No gain or loss will be
recognized by the Acquiring Fund upon the receipt of the assets of the Acquired
Fund solely in exchange for the Acquiring Fund Shares; (c) No gain or loss will
be recognized by the Acquired Fund upon the transfer of the Acquired Fund assets
to the Acquiring Fund in exchange for the Acquiring Fund Shares or upon the
distribution (whether actual or constructive) of the Acquiring Fund Shares to
Acquired Fund Shareholders in exchange for their shares of the Acquired Fund;
(d) No gain or loss will be recognized by the Acquired Fund Shareholders upon
the exchange of their Acquired Fund shares for the Acquiring Fund Shares; (e)
The tax basis of the Acquired Fund assets acquired by the Acquiring Fund will be
the same as the tax basis of such assets to the Acquired Fund immediately prior
to the Reorganization; (f) The tax basis of the Acquiring Fund Shares received
by each of the Acquired Fund Shareholders pursuant to the Reorganization will be
the same as the tax basis of the Acquired Fund shares held by such shareholder
immediately prior to the Reorganization; (g) The holding period of the assets of
the Acquired Fund in the hands of the Acquiring Fund will include the period
during which those assets were held by the Acquired Fund; and (h) The holding
period of the Acquiring Fund Shares to be received by each Acquired Fund
Shareholder will include the period during which the Acquired Fund Shares
exchanged therefor were held by such shareholder (provided the Acquired Fund
Shares were held as capital assets on the date of the Reorganization).
8.7 The Acquired Fund and Lehman shall have received the opinion of
counsel to the Acquiring Fund, dated as of the date of the Closing, addressed to
and in form and substance satisfactory to the Acquired Fund and Lehman to the
effect that: (i) the Acquiring Fund is a business trust duly organized and
existing under the laws of the Commonwealth of Massachusetts, has the power to
own all its properties and assets and to carry on its business as a registered
investment company, and each of its Portfolios is a validly existing series of
shares of such business trust; (ii) the Acquiring Fund is an open-end investment
company of the management type registered under the Investment Company Act of
1940; (iii) this Agreement and the Reorganization provided for herein and the
execution of this Agreement have been duly authorized and approved by all
requisite action of the Acquiring Fund and this Agreement has been duly executed
and delivered by the Acquiring Fund and is a valid and binding obligation of the
Acquiring Fund enforceable against the Acquiring Fund in accordance with its
terms, except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing; (iv) the Registration Statement on Form N-14 has been declared
effective under the Securities Act of 1933 and to such counsel's knowledge after
reasonable investigation no stop order has been issued or threatened suspending
its effectiveness and no order pursuant to Section 8(e) of the 1940 Act has been
issued; (v) to such counsel's knowledge, no consent, approval, order or other
authorization of any federal or Massachusetts state court or administrative or
regulatory agency is required for the Acquiring Fund to enter into this
Agreement or carry out its term that has not already been obtained, other than
where the failure to obtain any such consent, approval, order or authorization
would not have a material adverse effect on the operations of the Acquiring
Fund; (vi) to such counsel's knowledge, the Acquiring Fund is not in breach or
violation of any material contract to which it is a party, which breach or
violation would (a) affect the ability of the Acquiring Fund to enter into this
Agreement or consummate the transactions contemplated hereby, including the
Reorganization, or (b) have a material adverse effect on the business or
financial condition of the Acquiring Fund; (vii) to such counsel's knowledge, no
federal or Massachusetts state administrative or regulatory proceeding is
pending or threatened against the Acquiring Fund which would (a) affect the
ability the Acquiring Fund to enter into this Agreement or consummate the
transactions contemplated hereby, including the Reorganization; or (b) have a
material adverse effect on the business or financial condition of the Acquiring
Fund; and (viii) the Shares to be issued in the Reorganization have been duly
authorized and upon issuance thereof in accordance with this Agreement, will be
validly issued, fully paid and nonassessable and no Acquiring Fund Shareholder
has any preemptive rights to subscription or purchase in respect thereof; (ix)
the Registration Statement on Form N-14 (except as to financial data contained
therein as to which no opinion is given) complies as to form in all material
respects with the requirements of the Securities Act of 1933, the Securities
Exchange Act of 1934 and the 1940 Act and the rules and regulations thereunder;
(x) such counsel does not know of any legal, administrative or governmental
proceedings, investigation, order, decree or judgment of any court or
governmental body, only insofar as they relate to the Acquiring Fund or its
assets or property, pending, threatened or otherwise existing on or before the
effective date of the Registration Statement on Form N-14 or the Closing Date,
which are required to be described in such Registration Statement or to be filed
as exhibits thereto which are not described and filed as required; (xi) the
execution and delivery of this Agreement did not, and the consummation of the
transactions contemplated hereby will not result in a violation of the Acquiring
Fund's Declaration of Trust or By-laws or in violation of any material agreement
to which the Acquiring Fund is a party or by which it or its property is bound.
9. TERMINATION OF AGREEMENT.
9.1 This Agreement and the transactions contemplated hereby may be
terminated and abandoned by resolution of the Board of Trustees of the Acquired
Fund or the Board of Trustees of the Acquiring Fund, at any time prior to the
Closing Date without liability on the part of either party hereto, if
circumstances should develop that, in the opinion of the Board of Directors or
Trustees, as the case may be, of either party hereto, determines that proceeding
with the Agreement is not in the best interests of that party's shareholders.
9.2 If this Agreement is terminated and the exchange contemplated
hereby is abandoned pursuant to the provisions of this Section 9, this Agreement
shall become void and have no effect, without any liability on the part of any
party hereto (other than the agreement of Federated to assume the expenses of
the Reorganization) or the trustees, directors, officers or shareholders of the
Acquiring Fund or of the Acquired Fund, in respect of this Agreement.
10. WAIVER.
At any time prior to the Closing Date, any of the foregoing conditions
(other than that set forth in Section 8.6) may be waived by the Board of
Trustees of the Acquiring Fund or the Board of Trustees of the Acquired Fund if,
in the judgment of either, such waiver will not have a material adverse effect
on the benefits intended under this Agreement to the shareholders of the
Acquiring Fund or of the Acquired Fund, as the case may be.
11. AMENDMENT.
This Agreement and Plan of Reorganization may be amended at any time by the
mutual agreement of the Acquired Fund and the Acquiring Fund, authorized by
their respective Boards of Trustees and notwithstanding approval thereof by the
Acquired Fund Shareholders; provided, that if so approved by the Acquired Fund
Shareholders, no amendment shall be made which substantially changes the terms
hereof.
12. NO BROKER'S OR FINDER'S FEE.
The Acquired Fund and the Acquiring Fund each represents that there is no
person with whom it has dealt who by reason of such dealings is entitled to any
broker's or finder's or other similar fee or commission arising out of the
transactions contemplated by this Agreement and Plan of Reorganization.
13. MISCELLANEOUS.
13.1 The representations and warranties included or provided for
herein shall not survive consummation of the transactions contemplated hereby.
13.2 This Agreement contains the entire agreement and understanding
between the parties hereto with respect to the subject matter hereof, and merges
and supersedes all prior discussions, agreements, and understandings of every
kind and nature between them relating to the subject matter hereof. Neither
party shall be bound by any condition, definition, warranty, or representation,
other than as set forth or provided in this Agreement or as may be set forth in
a later writing signed by the party to be bound thereby.
13.3 This Agreement shall be governed and construed in accordance with
the internal laws of the State of New York, without giving effect to such
jurisdiction's conflicts of laws principles.
13.4 This Agreement may be executed in any number of counterparts,
each of which, when executed and delivered, shall be deemed to be an original.
13.5 This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be made by any
party without the written consent of the other party. Nothing herein expressed
or implied is intended or shall be construed to confer upon or give any person,
firm, or corporation, other than the parties hereto and their respective
successors and assigns, any rights or remedies under or by reason of this
Agreement.
13.6 The Acquired Fund is hereby expressly put on notice of the
limitation of liability as set forth in the Declaration of Trust of the
Acquiring Fund and agrees that the obligations assumed by the Acquiring Fund
pursuant to this Agreement shall be limited in any case to the Acquiring Fund
and its assets and the Acquired Fund shall not seek satisfaction of any such
obligation from the shareholders of the Acquiring Fund, the Trustees, officers,
employees, or agents of the Acquiring Fund or any of them.
13.7 The Acquiring Fund is hereby expressly put on notice of the
limitation of liability as set forth in the Declaration of Trust of the Acquired
Fund and agrees that the obligations assumed by the Acquired Fund pursuant to
this Agreement shall be limited in any case to the Acquired Fund and its assets
and the Acquiring Fund shall not seek satisfaction of any such obligation from
the shareholders of the Acquired Fund, the Trustees, officers, employees, or
agents of the Acquired Fund or any of them.
13.8 If the transactions contemplated by this Agreement and Plan of
Reorganization have not been completed by , 199 , the Agreement
-------------- -
shall automatically terminate on that date unless a later date is agreed to in
writing by the parties hereto.
IN WITNESS WHEREOF, each of the Acquired Fund, Lehman, the Acquiring Fund,
and Federated have caused this Agreement and Plan of Reorganization to be
executed and attested on its behalf by its duly authorized representatives as of
the date first above written.
Attest Acquired Fund:
LEHMAN BROTHERS INSTITUTIONAL
FUNDS GROUP TRUST, ON BEHALF OF
ITS PORTFOLIO, GOVERNMENT
OBLIGATIONS MONEY MARKET FUND
By:
Secretary
Name:
Title:
Attest: Lehman:
LEHMAN BROTHERS GLOBAL ASSET
MANAGEMENT INC.
By:
Secretary
Name:
Title:
Attest: Acquiring Fund:
MONEY MARKET OBLIGATIONS TRUST ON
BEHALF OF ITS PORTFOLIO, GOVERNMENT
OBLIGATIONS FUND
By:
Secretary
Federated:
Attest:
FEDERATED MANAGEMENT
By:
Secretary Name:
Title:
I:\b358\rcr\federated\agreement.reo
STATEMENT OF ADDITIONAL INFORMATION
, 1996
-----------
Acquisition of the assets of TREASURY INSTRUMENTS
MONEY MARKET FUND II, a portfolio of Lehman
Brothers Institutional Funds Group Trust
53 State Street
Boston, Massachusetts 02109-2873
Telephone No: 1-800-851-3134
By and in exchange for shares of
TREASURY OBLIGATIONS FUND, a portfolio of Money
Market Obligations Trust
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Telephone No. 1-800-245-5000
This Statement of Additional Information dated , 1996 is not a
--------------
prospectus. A Prospectus/Proxy Statement dated , 1996, related
----------------
to the above-referenced matter may be obtained from Money Market Obligations
Trust, on behalf of its portfolio, Treasury Obligations Fund, Federated
Investors Tower, Pittsburgh, Pennsylvania 15222-3779. This Statement of
Additional Information should be read in conjunction with such Prospectus/Proxy
Statement.
TABLE OF CONTENTS
1. Statement of Additional Information of Treasury Obligations Fund, a
portfolio of Money Market Obligations Trust, dated September 30, 1995.
2. Statement of Additional Information of Treasury Instruments Money Market
Fund II, a portfolio of Lehman Brothers Institutional Funds Group Trust,
dated , 1996.
------------------
3. Financial Statements of Government Obligations Fund, a portfolio of Money
Market Obligations Trust, dated July 31, 1996.
4. Financial Statements of Treasury Instruments Money Market Fund II, a
portfolio of Lehman Brothers Institutional Funds Group Trust, dated January
31, 1996.
5. Unaudited Financial Statements of Treasury Instruments Money Market Fund
II, a portfolio of Lehman Brothers Institutional Funds Group Trust, dated
July 31, 1996.
The Statement of Additional Information of Treasury Obligations Fund (the
"Portfolio"), a portfolio of Money Market Obligations Trust (the "Trust"), is
incorporated by reference to the Trust's Post-Effective Amendment No. to
----
its Registration Statement on Form N-1A (File No. ) which was
------------------
filed with the Securities and Exchange Commission on or about
, 1996.
- ------------------
The Statement of Additional Information of Treasury Instruments Money Market
Fund II (the "Fund"), a portfolio of Lehman Brothers Institutional Funds Group
Trust, is incorporated by reference to Lehman Brothers Institutional Funds Group
Trust's Post-Effective Amendment No. to its Registration Statement on
------
Form N-1A (File No. ) which was filed with the Securities and Exchange
---------
Commission on or about , 1996. A copy may be obtained from the
----------------
Trust at Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779.
Telephone Number: 1-800-245-5000.
The audited financial statements of the Portfolio dated July 31, 1996, are
incorporated by reference to the Annual Report to Shareholders of the Portfolio
which was filed with the Securities and Exchange Commission pursuant to Section
30(b)2 of the Investment Company Act of 1940, as amended, on or about
, 1996.
- -----------
The audited financial statements of the Fund dated January 31, 1996, are
incorporated by reference to the Annual Report to Shareholders of the Fund which
was filed with the Securities and Exchange Commission pursuant to Section 30(b)2
of the Investment Company Act of 1940, as amended, on or about
, 1996.
- --------------------
The unaudited financial statements of the Fund dated July 31, 1996, are
incorporated by reference to the Semi-Annual Report to Shareholders of the Fund
which was filed with the Securities and Exchange Commission pursuant to Section
30(b)2 of the Investment Company Act of 1940, as amended, on or about
, 1996.
- ---------------------------
Pro forma financial statements have not been prepared because, as of September
9, 1996, the net asset value of the Fund did not exceed ten percent of the net
asset value of the Registrant's Portfolio.
I:\b358\rcr\federated\lehman\stateme1.inf
FIRST DATA INVESTOR LEHMAN BROTHERS INSTITUTIONAL FUNDS
SERVICES GROUP, INC. GROUP TRUST
ONE EXCHANGE PLACE TREASURY INSTRUMENTS MONEY MARKET
53 STATE STREET FUND II
BOSTON, MASSACHUSETTS SPECIAL MEETING OF SHAREHOLDERS
02109 , 1996
----------
KNOW ALL PERSONS BY THESE PRESENTS
that the undersigned Shareholder of
TREASURY INSTRUMENTS MONEY MARKET
FUND II, a portfolio of Lehman
Brothers Institutional Funds Group
Trust, hereby appoints
or any of them, true and lawful
attorneys, with power of
substitution of each, to vote all
shares of TREASURY INSTRUMENTS
MONEY MARKET FUND II, a portfolio
of Lehman Brothers Institutional
Funds Group Trust, which the
undersigned is entitled to vote, at
the Special Meeting of Shareholders
to be held on , 1996, at
-----------
One Exchange Place, 53 State
Street, Boston, Massachusetts
02109, at .m., and at any
------ --
adjournment thereof.
Discretionary authority is hereby
conferred as to all other manners
as may properly come before the
Special Meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES. THE ATTORNEYS NAMED
WILL VOTE THE SHARES REPRESENTED BY THIS PROXY IN ACCORDANCE WITH THE CHOICE
MADE ON THIS BALLOT. IF THIS PROXY IS RETURNED AND NO CHOICE IS INDICATED AS TO
ANY MATTER, THIS PROXY WILL BE VOTED AFFIRMATIVELY ON THE MATTER PRESENTED.
PLEASE RETURN BOTTOM PORTION WITH YOUR VOTE IN THE ENCLOSED ENVELOPE AND RETAIN
THE TOP PORTION.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS X KEEP THIS
PORTION FOR YOUR RECORDS
TREASURY INSTRUMENTS MONEY MARKET FUND IIDETACH AND RETURN THIS
PORTION ONLY
VOTE ON
PROPOSAL
FORAGAINSTABSTAIN
" " " 1. APPROVAL OF A PROPOSED AGREEMENT
AND PLAN OF REORGANIZATION
BETWEEN LEHMAN BROTHERS
INSTITUTIONAL FUNDS GROUP TRUST,
ON BEHALF OF TREASURY INSTRUMENTS
MONEY MARKET FUND II (THE
"FUND"), AND MONEY MARKET
OBLIGATIONS TRUST (THE "TRUST"),
ON BEHALF OF ITS PORTFOLIO,
TREASURY OBLIGATIONS FUND (THE
"PORTFOLIO"), WHEREBY THE TRUST
WOULD ACQUIRE ALL OF THE ASSETS
AND KNOWN LIABILITIES OF THE FUND
IN EXCHANGE FOR INSTITUTIONAL
SHARES AND INSTITUTIONAL SERVICE
SHARES OF THE PORTFOLIO TO BE
DISTRIBUTED PRO RATA BY THE FUND
TO HOLDERS OF CLASS A SHARES AND
CLASS B SHARES, RESPECTIVELY, IN
COMPLETE LIQUIDATION OF THE FUND.
" " 2. ELECTION OF TRUSTEES TO SERVE
UNTIL THE NEXT ANNUAL MEETING OF
SHAREHOLDERS AND UNTIL THEIR
SUCCESSORS HAVE BEEN ELECTED AND
QUALIFIED. VOTE IS MADE FOR THE
ELECTION OF ALL NOMINATED
TRUSTEES LISTED EXCEPT THOSE
WHOSE NAME IS STRIKED OUT: J.F.
DONAHUE, T.G. BIGLEY, J.T.
CONROY, JR., W.J. COPELAND, J.C.
DONAHUE, J.E. DOWD, L.D. ELLIS,
M.D., E.L. FLAHERTY, JR., P.E.
MADDEN, G.F. MEYER, J.E. MURRAY,
JR., W.W. POSVAR, AND M.P. SMUTS.
PLEASE SIGN EXACTLY YOUR NAME(S) AS IT APPEARS BELOW. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, GUARDIAN, TRUSTEE, CUSTODIAN, ETC.,
PLEASE GIVE YOUR FULL TITLE AS SUCH. IF A CORPORATION OR PARTNERSHIP,
PLEASE SIGN THE FULL NAME BY AN AUTHORIZED OFFICER OR PARTNER. IF SHARES
ARE OWNED JOINTLY, ALL PARTIES SHOULD SIGN.
SIGNATURE SIGNATURE (JOINT OWNERS) DATE
b358\rcr\federated\lehmanproxy.sta
MONEY MARKET OBLIGATIONS TRUST{PRIVATE }
FORM N-14
PART C - OTHER INFORMATION
Item 15. Indemnification:
Indemnification is provided to Officers and Trustees of the Registrant
pursuant to Section 4 of Article XI of Registrant's Declaration of
Trust. The Investment Advisory Contract between the Registrant and
Federated Management (the "Adviser") provides that, in the absence of
willful misfeasance, bad faith, gross negligence, or reckless
disregard of the obligations or duties under the Investment Advisory
Contract on the part of the Adviser, the Adviser shall not be liable
to the Registrant or to any shareholder for any act or omission in the
course of or connected in any way with rendering services or for any
losses that may be sustained in the purchase, holding, or sale of any
security. Registrant's Trustees and Officers are covered by an Errors
and Omissions Policy.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "Act"), may be permitted to
Trustees, Officers, and controlling persons of the Registrant by the
Registrant pursuant to the Declaration of Trust or otherwise, the
Registrant is aware that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed
in the Act and, therefore, is unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by Trustees,
Officers, or controlling persons of the Registrant in connection with
the successful defense of any act, suit, or proceeding) is asserted by
such Trustees, Officers, or controlling persons in connection with the
shares being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such issues.
Insofar as indemnification for liabilities may be permitted pursuant
to Section 17 of the Investment Company Act of 1940, as amended, for
Trustees, Officers, and controlling persons of the Registrant by the
Registrant pursuant to the Declaration of Trust or otherwise, the
Registrant is aware of the position of the Securities and Exchange
Commission as set forth in Investment Company Act Release No. IC-
11330. Therefore, the Registrant undertakes that in addition to
complying with the applicable provisions of the Declaration of Trust
or otherwise, in the absence of a final decision on the merits by a
court or other body before which the proceeding was brought, that an
89
indemnification payment will not be made unless in the absence of such
a decision, a reasonable determination based upon factual review has
been made: (i) by a majority vote of a quorum of non-party Trustees
who are not interested persons of the Registrant, or (ii) by
independent legal counsel for an act of willful misfeasance, bad
faith, gross negligence, or reckless disregard of duties. The
Registrant further undertakes that advancement of expenses incurred in
the defense of a proceeding (upon undertaking for repayment unless it
is ultimately determined that indemnification is appropriate) against
an Officer, Trustee, or controlling person of the Registrant will not
be made absent the fulfillment of at least one of the following
conditions: (i) the indemnitee provides security for his undertaking;
(ii) the Registrant is insured against losses arising by reason of any
lawful advances; or (iii) a majority of a quorum of disinterested non-
party Trustees or independent legal counsel in a written opinion makes
a factual determination that there is reason to believe the indemnitee
will be entitled to indemnification.
Item 16 Exhibits
1.1 Copy of Declaration of Trust of the Registrant dated October 3, 1988 (1)
1.2 Amendment to the Declaration of Trust dated October 3, 1989 (1)
1.3 Conformed Copy of Amendment No. 8 to Declaration of Trust dated December
28, 1994 (2)
90
2. Copy of Bylaws of the Registrant (1)
3. Not Applicable
4. Agreement and Plan of Reorganization is included as Appendix A to the
Combined Proxy Statement and Prospectus of this Registration Statement *
5. Copy of Specimen Certificate for Shares of Beneficial Interest of the
Registrant (3)
6.1 Copy of Investment Advisory Contract of the Registrant (10)
6.2 Copy of Exhibit G to Investment Advisory Contract (1)
6.3 Conformed Copy of Investment Advisory Contract between Registrant and
Federated Administrative Services dated March 1, 1995 (6)
7.1 Copy of Distributor's Contract of the Registrant (4)
7.2 Copy of Exhibits F, G and H to the Distributor's Contract of the Registrant
(5)
7.3 Copy of Exhibits C and D to Distributor's Contract of the Registrant (6)
8. Not Applicable
91
* Filed electronically.
(1) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 16 to its Registration Statement on Form N-1A filed September
27, 1995. (File Nos. 33-31602 and 811-5950).
(2) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 12 to its Registration Statement on Form N-1A filed February
21, 1995. (File Nos. 33-31602 and 811-5950).
(3) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 8 to its Registration Statement on Form
N-1A filed June 1, 1994. (File Nos. 33-31602 and 811-5950).
(4) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 7 to its Registration Statement on Form
N-1A filed May 6, 1994. (File Nos. 33-31602 and 811-5950).
(5) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 11 to its Registration Statement on Form
N-1A filed November 25, 1994. (File Nos. 33-31602 and 811-5950).
(6) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 13 to its Registration Statement on Form
N-1A filed May 5, 1995. (File Nos. 33-31602 and 811-5950).
92
(10) Response is incorporated by reference to Registrant's Initial Registration
Statement on Form N-1A filed October 20, 1989. (File Nos. 33-38550 and 811-
7141).
9.1 Conformed Copy of Custodian Agreement of the Registrant (3)
9.2 Conformed Copy of Transfer Agency and Service Agreement of the Registrant
(3)
9.3 Conformed Copy of Fund Accounting Agreement (2)
10.1 Conformed Copy of the Specimen Mutual Funds Sales and Service
Agreement; Mutual Funds Service Agreement; and Plan Trustee/Mutual
Funds Service Agreement (7)
10.2 Copy of Rule 12b-1 Plan dated June 1, 1994 (5)
10.3 Conformed Copy of Rule 18-3 Plan (8)
11. Copy of Opinion and Consent of Counsel as to legality of shares being
registered *
93
12. Form of Tax Opinion of Howard & Howard Attorneys, P.C. (To be filed by
amendment.)
13. Conformed Copy of Amended and Restated Shareholder Services Agreement of
the Registrant*
14.1 Conformed Copy of Consent of Arthur Andersen LLP*
14.2 Conformed Copy of Consent of Ernst & Young LLP*
15. Not Applicable
16. Conformed Copy of Power of Attorney (9)
17.1 Copy of Declaration under Rule 24f-2 *
17.2 Form of Proxy*
* Filed electronically.
(2) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 12 to its Registration Statement on Form N-1A filed February
21, 1995. (File Nos. 33-31602 and 811-5950).
(3) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 8 to its Registration Statement on Form
94
N-1A filed June 1, 1994. (File Nos. 33-31602 and 811-5950).
(5) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 11 to its Registration Statement on Form
N-1A filed November 25, 1994. (File Nos. 33-31602 and 811-5950).
(7) Response is incorporated by reference to Cash Trust Series II's Post
Effective Amendment No. 6 to its Registration Statement on Form N-1A filed
July 24, 1995. (File Nos. 33-38550 and 811-7141).
(8) Response is incorporated by reference to the World Investment Series,
Inc's. Registration Statement on Form N-1A filed with the Commission on
January 26, 1996. (File Nos. 33-52149 and 811-07141)
(9) Response is incorporated by reference to Registrant's Post-Effective
Amendment No. 18 to its Registraton Statement on Form N-1A filed with the
Commission on August 29, 1996. (File Nos. 33-31602 and 811-5950)
Item 17. Undertakings:
(1) The undersigned Registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is
part of this Registration Statement by any person or party who is
deemed to be an underwriter within the meaning of Rule 145(c) of the
95
Securities Act of 1933, as amended, the reoffering prospectus will
contain the information called for by the applicable registration form
for the reofferings by persons who may be deemed underwriters, in
addition to the information called for by the other items of the
applicable form.
(2) The undersigned Registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as part of an amendment to the
Registration Statement and will not be used until the amendment is
effective, and that in determining any liability under the Securities
Act of 1933, as amended, each post-effective amendment shall be deemed
to be a new Registration Statement for the securities offered therein;
and the offering of the securities at that time shall be deemed to be
the initial bona fide offering of them.
(3) The undersigned Registrant agrees that the opinion of Howard & Howard
Attorneys, P.C. with respect to the federal income tax consequences of
the reorganization will be filed by Post-Effective Amendment to this
Registration Statement.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant, MONEY MARKET OBLIGATIONS TRUST, has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
96
authorized, in the City of Pittsburgh and Commonwealth of Pennsylvania, on the
16th day of September, 1996.
MONEY MARKET OBLIGAITONS TRUST
BY: /s/J. Crilley Kelly
J. Crilley Kelly, Assistant Secretary
Attorney in Fact for John F. Donahue
September 16, 1996
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to its Registration Statement has been signed below by the following person in
the capacity and on the date indicated:
NAME TITLE DATE
By:/s/J. Crilley Kelly
J. Crilley Kelly Attorney In Fact September 16, 1996
ASSISTANT SECRETARY For the Persons
Listed Below
NAME TITLE
John F. Donahue* Chairman and Trustee
(Chief Executive Officer)
97
J. Christopher Donahue* President and Trustee
John W. McGonigle* Treasurer and Executive Vice
President
(Principal Financial and
Accounting Officer)
Thomas G. Bigley* Trustee
John T. Conroy, Jr.* Trustee
William J. Copeland* Trustee
James E. Dowd* Trustee
Lawrence D. Ellis, M.D.* Trustee
Edward L. Flaherty, Jr.* Trustee
Peter E. Madden* Trustee
Gregor F. Meyer* Trustee
John E. Murray, Jr.* Trustee
Wesley W. Posvar* Trustee
98
Marjorie P. Smuts* Trustee
* By Power of Attorney
FEDERATED SERVICES COMPANY
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
September 13, 1996
The Trustees of
Money Market Obligations Trust
Federated Investors Tower
Pittsburgh, PA 15222-3779
Gentlemen:
Money Market Obligations Trust, a Massachusetts business trust
(`Trust''), proposes to issue shares of beneficial interest representing
interests in a separate portfolio of securities known as Treasury
Obligations Fund (such shares of beneficial interest being herein referred
to as `Shares'') in connection with the acquisition of the assets of
Treasury Instruments Money Market Fund II, a portfolio of Lehman Brothers
Institutional Funds Group Trust, a Massachusetts business trust, pursuant
to the Agreement and Plan of Reorganization dated as of September 6, 1996
(`Agreement''), filed as an exhibit to the registration statement of the
Trust filed on Form N-14 (Securities Act of 1933 No. to be assigned) under
the Securities Act of 1933 as amended (`N-14 Registration'').
As counsel I have participated in the organization of the Trust, its
registration under the Investment Company Act of 1940, the registration of
its securities on Form N-1A under the Securities Act of 1933 and its N-14
Registration. I have examined and am familiar with the written Declaration
of Trust dated October 3, 1988 (`Declaration of Trust''), the Bylaws of
the Trust, the Agreement and such other documents and records deemed
relevant. I have also reviewed questions of law and consulted with
counsel thereon as deemed necessary or appropriate for the purposes of this
opinion.
Based upon the foregoing, it is my opinion that:
1. The Trust is duly organized and validly existing pursuant to the
Declaration of Trust.
2. The Shares which are currently being registered by the N-14
Registration may be legally and validly issued in accordance with the
provisions of the Agreement and the Declaration of Trust upon receipt of
consideration sufficient to comply with the provisions of Article III,
Section 3, of the Declaration of Trust and subject to compliance with the
Investment
Company Act of 1940, as amended, and applicable state laws regulating the
sale of securities. Such Shares, when so issued, will be fully paid and
non-assessable.
I consent to your filing this opinion as an exhibit to the N-14
Registration referred to above and to any application or registration
statement filed under the securities laws of any of the states of the
United States.
Very truly yours,
FEDERATED SERVICES COMPANY
By:/s/ S. Elliott Cohan
S. Elliott Cohan
Title: Vice President and
Assistant Secretary
Exhibit 14.1
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use in Form N-
14 Registration Statement of Treasury Obligations Fund (a portfolio of
Money Market Obligations Trust) of our report dated August 20, 1996, on the
financial statements as of July 31, 1996, included in or made a part of
this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Pittsburgh, Pennsylvania
September 6, 1996
Exhibit 14.2
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Statement of Additional
Information included in the Registration Statement on Form N-14
(No. 33-31602) of our report dated March 8, 1996 on the financial
statements included in the Annual Report to Shareholders of Treasury
Instruments Money Market Fund II, a portfolio of Lehman Brothers
Institutional Funds Group Trust.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Boston, Massachusetts
September 11, 1996
Exhibit 17.1
Rule 24f-2 Notice
MONEY MARKET OBLIGATIONS TRUST
(Fund Name)
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
1933 Act No. 33-31602
(i) fiscal period for which notice is filed July 31, 1995
(ii) The number or amount of securities of the
same class or series, if any, which had
been registered under the Securities Act
of 1933, other than pursuant to Rule 24f-2
but which remained unsold at August 1, 1994,
the beginning of the Registrant's fiscal
period -0-
(iii) The number or amount
of securities, if
any, registered during the fiscal period
of this notice other than pursuant to
Rule 24f-2 507,379,462
507,379,462
(iv) The number or amount of securities
sold during the fiscal period of this
notice
69,678,597,301
(v) The number or amount of securities sold
during the fiscal period of this notice
in reliance upon registration pursuant
to Rule 24f-2 (see attached Computation
of Fee)
69,171,217,839
WITNESS the due execution hereof this 15th day of September,
1995.
By: /s/J. Crilley Kelly
J. Crilley Kelly
Assistant Secretary
COMPUTATION OF FEE
1. Actual aggregate sale price of Registrant's
securities sold pursuant to Rule 24f-2 during
the fiscal period for which the 24f-2 notice
is filed (see Section v)
$69,171,217,839
2. Reduced by the difference between:
(a) actual aggregate redemption price
of such securities redeemed by the
issuer during the fiscal period for
which the 24f-2 notice is filed $64,262,157,537
(b) actual aggregate redemption price
of such redeemed securities
previously applied by the issuer
pursuant to Section 24e(2)(a) for
the fiscal period for which the
24f-2 notice is filed -0-
$64,262,157,537
Total amount upon which the fee calculation specified
in Section 6(b) of the Securities Act of 1933 is based $
4,909,060,302
FEE SUBMITTED (1/29 of 1% of Total amount) $
1,692,779
CONVERSION OF NET REDEMPTIONS ON
RULE 24f-2 NOTICE TO FILING
UNDER RULE 24e-2
When a negative amount appears on the line captioned "Total
amount upon which the fee calculated specified in Section 6(b)
of the Securities Act of 1933 is based", the following
calculation should be made to determine the share information
needed to file under Rule 24e-2:
Total redemptions (per annual report)
1,322,807
Less: Line (v) - Rule 24f-2 Notice 18,398
Shares available to register under
Rule 24e-2 1,304,409(a)
Fund's Current Net Asset Value $ 9.87(b)
Multiply: Shares available to register
under Rule 24e-2 by the fund's current
net asset value (a x b) to obtain Proposed
Maximum Aggregate Offering Price $12,874,517
Federated Administrative
Services
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
412-288-1900
September 15, 1995
Money Market Obligations Trust
Federated Investors Tower
Pittsburgh, PA 15222-3779
Gentlemen:
You have requested my opinion for use in conjunction with a
Rule 24f-2 Notice for Money Market Obligations Trust ("Trust") to
be filed in respect of shares of the Trust ("Shares") sold for
the fiscal year ended July 31, 1995, pursuant to the Trust's
registration statement filed with the Securities and Exchange
Commission ("SEC") under the Securities Act of 1933 (File No. 33-
31602) ("Registration Statement").
In its Registration Statement, the Trust elected to register
an indefinite number of shares pursuant to the provisions of
Investment Company Act Rule 24f-2.
As counsel I have participated in the preparation and filing
of the Trust's amended Registration Statement under the
Securities Act of 1933. Further, I have examined and am familiar
with the provisions of the Declaration of Trust dated October 3,
1988 ("Declaration of Trust"), the Bylaws of the Trust and such
other documents and records deemed relevant. I have also reviewed
questions of law and consulted with counsel thereon as deemed
necessary or appropriate by me for the purposes of this opinion.
On the basis of the foregoing, it is my opinion the Shares
sold for the fiscal year ended July 31, 1995, registration of
which the Rule 24f-2 Notice makes definite in number, were
legally issued, fully paid and non-assessable by the Trust.
I hereby consent to the filing of this opinion as an exhibit
to the Rule 24f-2 Notice referred to above, the Registration
Statement of the Trust and to any application or registration
statement filed under the securities laws of any of the States of
the United States.
The foregoing opinion is limited to the Federal laws of the
United States and the laws of the Commonwealth of Massachusetts,
and I am expressing no opinion as to the effect of the laws of
any other jurisdiction.
Very truly yours,
S. Elliott Cohan
Deputy General Counsel
MONEY MARKET OBLIGATIONS TRUST
Federated Investors
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
September 15, 1995
EDGAR Operations Branch
Securities and Exchange Commission
Division of Investment Management
450 Fifth Street, Northwest
Washington, DC 20549
RE: Rule 24f-2 Notice for MONEY MARKET OBLIGATIONS TRUST
1933 Act File No. 33-31602
1940 Act File No. 811-5950
Dear Sir or Madam:
Pursuant to the provisions of Rule 24f-2 of the
Investment Company Act of 1940, I enclose the Rule 24f-2
Notice for Money Market Obligations Trust.
Since the aggregate sales price of securities sold by the
fund during the period for which the Rule 24f-2 Notice is
filed exceeded the aggregate redemption price of securities
redeemed, an additional filing fee in the amount of $1,692,779
pursuant to Rule 24f-2(c) has been remitted to the U.S.
Treasury Lockbox at Mellon Bank in Pittsburgh.
As required by Rule 24f-2(b)(1)(v), a conformed opinion
of counsel has been electronically filed herewith which
indicates whether the securities, the registration of which
this Notice makes definite in number, were legally issued,
fully paid and non-assessable.
Very truly yours,
/s/ J. Crilley Kelly
J. Crilley Kelly
Assistant Secretary
Enclosures
cc: Charles H. Morin, Esquire
Matthew G. Maloney, Esquire
Linda L. Banas
EXHIBIT 13
AMENDED AND RESTATED
SHAREHOLDER SERVICES AGREEMENT
THIS AGREEMENT, amended and restated as of the first day of September,
1995, (originally made and entered into as of the first day of March,
1994), by and between those investment companies listed on Exhibit 1, as
may be amended from time to time, having their principal office and place
of business at Federated Investors Tower, Pittsburgh, PA 15222-3779 and
who have approved this form of Agreement (individually referred to herein
as a "Fund" and collectively as "Funds") and Federated Shareholder
Services, a Delaware business trust, having its principal office and place
of business at Federated Investors Tower, Pittsburgh, Pennsylvania 15222-
3779 ("FSS").
1. The Funds hereby appoint FSS to render or cause to be rendered personal
services to shareholders of the Funds and/or the maintenance of accounts of
shareholders of the Funds ("Services"). In addition to providing Services
directly to shareholders of the Funds, FSS is hereby appointed the Funds'
agent to select, negotiate and subcontract for the performance of Services.
FSS hereby accepts such appointments. FSS agrees to provide or cause to be
provided Services which, in its best judgment (subject to supervision and
control of the Funds' Boards of Trustees or Directors, as applicable), are
necessary or desirable for shareholders of the Funds. FSS further agrees
to provide the Funds, upon request, a written description of the Services
which FSS is providing hereunder.
2. During the term of this Agreement, each Fund will pay FSS and FSS
agrees to accept as full compensation for its services rendered hereunder a
fee at an annual rate, calculated daily and payable monthly, up to 0.25% of
1% of average net assets of each Fund.
For the payment period in which this Agreement becomes effective or
terminates with respect to any Fund, there shall be an appropriate
Amended and Restated
Shareholder Services Agreement Page 2
proration of the monthly fee on the basis of the number of days that this
Agreement is in effect with respect to such Fund during the month.
3. This Agreement shall continue in effect for one year from the date of
its execution, and thereafter for successive periods of one year only if
the form of this Agreement is approved at least annually by the Board of
each Fund, including a majority of the members of the Board of the Fund who
are not interested persons of the Fund ("Independent Board Members") cast
in person at a meeting called for that purpose.
4. Notwithstanding paragraph 3, this Agreement may be terminated as
follows:
(a) at any time, without the payment of any penalty, by the vote
of a majority of the Independent Board Members of any Fund or
by a vote of a majority of the outstanding voting securities of
any Fund as defined in the Investment Company Act of 1940 on
sixty (60) days' written notice to the parties to this
Agreement;
(b) automatically in the event of the Agreement's assignment as
defined in the Investment Company Act of 1940; and
(c) by any party to the Agreement without cause by giving the
other party at least sixty (60) days' written notice of its
intention to terminate.
5. FSS agrees to obtain any taxpayer identification number certification
from each shareholder of the Funds to which it provides Services that is
required under Section 3406 of the Internal Revenue Code, and any
applicable Treasury regulations, and to provide each Fund or its designee
with timely written notice of any failure to obtain such taxpayer
identification number certification in order to enable the implementation
of any required backup withholding.
6. FSS shall not be liable for any error of judgment or mistake of law or
for any loss suffered by any Fund in connection with the matters to which
Amended and Restated
Shareholder Services Agreement Page 3
this Agreement relates, except a loss resulting from willful misfeasance,
bad faith or gross negligence on its part in the performance of its duties
or from reckless disregard by it of its obligations and duties under this
Agreement. FSS shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for such Fund) on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to
such advice. Any person, even though also an officer, trustee, partner,
employee or agent of FSS, who may be or become a member of such Fund's
Board, officer, employee or agent of any Fund, shall be deemed, when
rendering services to such Fund or acting on any business of such Fund
(other than services or business in connection with the duties of FSS
hereunder) to be rendering such services to or acting solely for such Fund
and not as an officer, trustee, partner, employee or agent or one under the
control or direction of FSS even though paid by FSS.
This Section 6 shall survive termination of this Agreement.
7. No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which an enforcement of the change, waiver, discharge or
termination is sought.
8. FSS is expressly put on notice of the limitation of liability as set
forth in the Declaration of Trust of each Fund that is a Massachusetts
business trust and agrees that the obligations assumed by each such Fund
pursuant to this Agreement shall be limited in any case to such Fund and
its assets and that FSS shall not seek satisfaction of any such obligations
from the shareholders of such Fund, the Trustees, Officers, Employees or
Agents of such Fund, or any of them.
9. The execution and delivery of this Agreement have been authorized by
the Trustees of FSS and signed by an authorized officer of FSS, acting as
such, and neither such authorization by such Trustees nor such execution
and delivery by such officer shall be deemed to have been made by any of
Amended and Restated
Shareholder Services Agreement Page 4
them individually or to impose any liability on any of them personally, and
the obligations of this Agreement are not binding upon any of the Trustees
or shareholders of FSS, but bind only the trust property of FSS as provided
in the Declaration of Trust of FSS.
10.Notices of any kind to be given hereunder shall be in writing
(including facsimile communication) and shall be duly given if delivered to
any Fund and to such Fund at the following address: Federated Investors
Tower, Pittsburgh, PA 15222-3779, Attention: President and if delivered
to FSS at Federated Investors Tower, Pittsburgh, PA 15222-3779, Attention:
President.
11.This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written. If any provision of this Agreement shall
be held or made invalid by a court or regulatory agency decision, statute,
rule or otherwise, the remainder of this Agreement shall not be affected
thereby. Subject to the provisions of Sections 3 and 4, hereof, this
Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed by
Pennsylvania law; provided, however, that nothing herein shall be construed
in a manner inconsistent with the Investment Company Act of 1940 or any
rule or regulation promulgated by the Securities and Exchange Commission
thereunder.
12.This Agreement may be executed by different parties on separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the
same instrument.
13.This Agreement shall not be assigned by any party without the prior
written consent of FSS in the case of assignment by any Fund, or of the
Funds in the case of assignment by FSS, except that any party may assign to
a successor all of or a substantial portion of its business to a party
Amended and Restated
Shareholder Services Agreement Page 5
controlling, controlled by, or under common control with such party.
Nothing in this Section 14 shall prevent FSS from delegating its
responsibilities to another entity to the extent provided herein.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first
above written.
Investment Companies (listedon Exhibit 1)
By: /s/ John F. Donahue
John F. Donahue
Chairman
Attest: /s/ John W. McGonigle
John W. McGonigle
Secretary
Federated Shareholder Services
By: /s/ John F. Donahue
President
Attest: /s/ Joseph M. Huber
Secretary
