1933 Act File No. 33-34079
1940 Act File No. 811-6071
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
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Amendment No. 26.................................................X
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BT INSTITUTIONAL FUNDS
(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)
Jay S. Neuman, Esq. Copies to: Burton M. Leibert, Esq.
Federated Investors Tower Willkie Farr & Gallagher
Pittsburgh, Pennsylvania 15222-3779 One Citicorp Center
(Name and Address of Agent for Service) 153 East 53rd Street
New York, New York 10022
<PAGE>
EXPLANATORY NOTE
This Registration Statement has been filed by BT Institutional Funds
(the "Registrant") pursuant to Section 8(b) of the Investment Company
Act of 1940, as amended. However, shares of beneficial interest of
Institutional Daily Assets Fund (the "Fund"), a series of the
Registrant, are not being registered under the Securities Act of 1933
(the "1933 Act") since such shares will be issued by the Registrant
solely in private placement transactions which do not involve any
"public offering" within the meaning of Section 4(2) of the 1933 Act.
Shares of the Fund may only be purchased by "accredited investors," as
that term is defined in Rule 501(a) of Regulation D under the
Securities Act. This Registration Statement does not constitute an
offer to sell, or the solicitation of an offer to buy, any shares of
beneficial interest of the Fund.
International Equity Fund (Class I and Class II) is a series of shares
of the Registrant and is offered by separate Prospectuses included in
Post-Effective Amendment No. 18 to the Registrant's Registration
Statement. Institutional Cash Management Fund, Institutional Treasury
Money Fund, Equity 500 Index Fund, and Institutional Cash Reserves,
Institutional Liquid Assets Fund, are each a series of shares of the
Registrant and are each offered by separate Prospectuses included in
Post-Effective Amendment No. 19 to the Registrant's Registration
Statement. This Amendment does not relate to, amend or otherwise
affect any of the separate Prospectuses contained in Post-Effective
Amendment No. 18 and 19 and, therefore, pursuant to Rule 485(d) under
the Securities Act of 1933, as amended (the "1933 Act"), does not
affect the effectiveness of such Post-Effective Amendments.
BT INSTITUTIONAL FUNDS
INSTITUTIONAL DAILY ASSETS FUND
PART A
Responses to Items 1 through 3 and 5A have been omitted pursuant to
paragraph 4 of Instruction F of the General Instructions to Form N-1A.
ITEM 4. GENERAL DESCRIPTION OF REGISTRANT.
See "Investment Objective and Policies" and "Risk Factors" in the
Private Placement Memorandum which is attached hereto.
ITEM 5. MANAGEMENT OF THE FUND.
See "Summary of Fund Expenses" and "Management of the Fund and Trust"
in the Private Placement Memorandum attached hereto.
ITEM 6. CAPITAL STOCK AND OTHER SECURITIES.
See "Management of the Trust and Fund--Organization of the Trust" and
"Taxation" in the Private Placement Memorandum attached hereto.
ITEM 7. PURCHASE OF SECURITIES BEING OFFERED.
See "Net Asset Value" and "Purchases and Redemptions of Shares" in the
Private Placement Memorandum attached hereto.
ITEM 8. REDEMPTION OR REPURCHASE.
See "Purchase and Redemptions of Shares" in the Private Placement
Memorandum attached hereto.
ITEM 9. PENDING LEGAL PROCEEDINGS.
Not applicable.
<PAGE>
2
BT INSTITUTIONAL FUNDS
Prospective
Investor Copy #
CONFIDENTIAL PRIVATE OFFERING MEMORANDUM
October 7, 1997
INSTITUTIONAL DAILY ASSETS FUND
BANKERS TRUST COMPANY
INVESTMENT ADVISER AND ADMINISTRATOR
EDGEWOOD SERVICES, INC.
PLACEMENT AGENT
CLEARING OPERATIONS
P.O. BOX 897
PITTSBURGH, PA 15230-0897
DO NOT COPY OR CIRCULATE
<PAGE>
13
October 7, 1997
CONFIDENTIAL PRIVATE OFFERING MEMORANDUM
BT INSTITUTIONAL FUNDS
INSTITUTIONAL DAILY ASSETS FUND
The Institutional Daily Assets Fund (the "Fund") seeks a high level of
current income consistent with liquidity and the preservation of
capital through investment in high-quality money market instruments.
The Fund is a registered investment company under the Investment
Company Act of 1940, as amended (the "1940 Act") and is a diversified
series of BT Institutional Funds, a Massachusetts business trust (the
"Trust"). Bankers Trust Company ("Bankers Trust") serves as the Fund's
investment adviser (the "Adviser") The Fund is a management investment
company commonly known as a money market fund.
Please read this Confidential Private Offering Memorandum (the
"Memorandum") carefully before investing and retain it for future
reference. It contains important information about the Fund that
investors should know before investing.
A Confidential Statement of Additional Information with respect to the
Fund ("SAI") with the same date has been filed with the Securities and
Exchange Commission (the "SEC"), and is incorporated herein by
reference. A copy of the SAI is available without charge by calling
the Fund at (212) 250-6934.
Three copies of a Subscription Agreement for use in subscribing to
purchase shares of the Fund accompany delivery of this Memorandum. In
order to purchase shares of the Fund, a prospective investor must
satisfactorily complete, execute and deliver each copy of the
Subscription Agreement to Bankers Trust Company, 130 Liberty Street,
New York, New York 10006.
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, BANKERS TRUST OR ANY OTHER BANKING OR DEPOSITORY
INSTITUTION, AND THE SHARES ARE NOT FEDERALLY GUARANTEED OR INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE U.S. GOVERNMENT, THE
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY. THE FUND INTENDS TO
MAINTAIN A CONSTANT $1.00 PER SHARE NET ASSET VALUE ("NAV"), ALTHOUGH
THERE CAN BE NO ASSURANCE THAT IT WILL BE ABLE TO DO SO.
THE SECURITIES DESCRIBED HEREIN ARE OFFERED PURSUANT TO AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS
AMENDED, AND HAVE NOT BEEN REGISTERED WITH OR APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY OTHER REGULATORY
AUTHORITY OF ANY JURISDICTION, NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS MEMORANDUM.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SHARES OF THE FUND ARE BEING OFFERED FOR INVESTMENT ONLY TO INVESTORS
WHO QUALIFY AS BOTH (1) "ACCREDITED INVESTORS" AS DEFINED UNDER
REGULATION D UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND (2)
INSTITUTIONAL INVESTORS. SHARES OF THE FUND ARE NOT BEING OFFERED TO
INDIVIDUALS OR TO ENTITIES ORGANIZED FOR THE PURPOSE OF INVESTING ON
BEHALF OF INDIVIDUALS.
INVESTORS WILL BE REQUIRED TO REPRESENT THAT THEY MEET CERTAIN
FINANCIAL REQUIREMENTS AND THAT THEY ARE FAMILIAR WITH AND UNDERSTAND
THE TERMS, RISKS AND MERITS OF AN INVESTMENT IN THE FUND.
NO RESALE OF SHARES MAY BE MADE UNLESS THE SHARES ARE SUBSEQUENTLY
REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE.
THIS CONFIDENTIAL PRIVATE OFFERING MEMORANDUM HAS BEEN PREPARED ON A
CONFIDENTIAL BASIS SOLELY FOR THE INFORMATION OF THE RECIPIENT AND MAY
NOT BE REPRODUCED, PROVIDED TO OTHERS OR USED FOR ANY OTHER PURPOSE.
NO PERSON HAS BEEN AUTHORIZED TO MAKE REPRESENTATIONS OR GIVE ANY
INFORMATION WITH RESPECT TO THE SHARES, EXCEPT THE INFORMATION
CONTAINED HEREIN OR IN THE TRUST'S REGISTRATION STATEMENT FILED UNDER
THE 1940 ACT.
<PAGE>
FOR NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A
LICENSE HAS BEEN FILED WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT
THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN
THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE ATTORNEY
GENERAL OR THE SECRETARY OF STATE THAT ANY DOCUMENT FILED UNDER RSA
421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR
THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR
TRANSACTION MEANS THAT THE ATTORNEY GENERAL HAS PASSED IN ANY WAY UPON
THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO,
ANY PERSON, SECURITY, OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE
TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT, ANY
REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.
FOR GEORGIA INVESTORS
THESE SECURITIES HAVE BEEN ISSUED OR SOLD IN RELIANCE ON PARAGRAPH
(13) OF CODE SECTION 10-5-9 OF THE `GEORGIA SECURITIES ACT OF 1973,
AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A TRANSACTION WHICH IS
EXEMPT UNDER SUCH ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION UNDER
SUCH ACT.
FOR FLORIDA INVESTORS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE FLORIDA SECURITIES
AND INVESTOR PROTECTION ACT.
IF SALES ARE MADE TO FIVE (5) OR MORE INVESTORS IN FLORIDA, ANY
FLORIDA INVESTOR MAY, AT THE INVESTOR'S OPTION, VOID ANY PURCHASE
HEREUNDER WITHIN A PERIOD OF THREE (3) DAYS AFTER THE INVESTOR (A)
FIRST TENDERS OR PAYS TO THE ISSUER, AN AGENT OF THE ISSUER OR AN
ESCROW AGENT THE CONSIDERATION REQUIRED HEREUNDER OR (B) DELIVERS ITS
EXECUTED SUBSCRIPTION AGREEMENT, WHICHEVER OCCURS LATER. TO ACCOMPLISH
THIS, IT IS SUFFICIENT FOR A FLORIDA INVESTOR TO SEND A LETTER OR
TELEGRAM TO THE ISSUER WITHIN SUCH THREE (3) DAY PERIOD, STATING THAT
THE INVESTOR IS VOIDING AND RESCINDING THE PURCHASE. IF AN INVESTOR
SENDS A LETTER, IT IS PRUDENT TO DO SO BY CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO INSURE THAT THE LETTER IS RECEIVED AND TO
EVIDENCE THE TIME OF MAILING.
<PAGE>
TABLE OF CONTENTS
SUMMARY OF FUND EXPENSES 4
FINANCIAL HIGHLIGHTS 5
INVESTMENT OBJECTIVE AND POLICIES 6
RISK FACTORS 9
NET ASSET VALUE 9
PURCHASE AND REDEMPTION OF SHARES 9
DIVIDENDS, DISTRIBUTIONS AND TAXES 10
PERFORMANCE INFORMATION AND REPORTS 10
MANAGEMENT OF THE FUND AND TRUST 11
- -------------------------------------------------------------
<PAGE>
SUMMARY OF FUND EXPENSES
The following table provides (i) a summary of expenses relating to
purchases and sales of shares of the Fund and the estimated aggregate
annual operating expenses of the Fund, as a percentage of average net
assets of the Fund and (ii) an example illustrating the dollar cost of
such expenses on a $1,000 investment in the Fund.
ANNUAL OPERATING EXPENSES
(as a percentage of the average daily net assets of the Fund)
Investment Advisory Fee 0.10%
Distribution (Rule 12b-1) Fee None
Other expenses (after reimbursements or waivers) 0.02
Total operating expenses (after reimbursements or waivers) 0.12%
EXAMPLE 1 year 3 years
You would pay the following expenses on a $1,000 $1 $4
: (1) 5% annual return and
each time period.the end of
- - -------------------------------------------------------------------
The expense table and the example above show the estimated costs and
expenses that an investor will bear directly or indirectly as a
shareholder of the Fund. The expense table and the example reflect a
voluntary undertaking by Bankers Trust to waive or reimburse expenses
such that the total operating expenses will not exceed 0.12% of the
Fund's average net assets annually. In the absence of this
undertaking, for the period ended June 30, 1997, the total operating
expenses would have been equal to 0.13% of the Fund's average net
assets annually. THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION
OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESS
THAN THOSE SHOWN. Moreover, while each example assumes a 5% annual
return, actual performance will vary and may result in a return
greater or less than 5%.
Shares of the Fund are distributed by Edgewood Services, Inc.
("Edgewood") as the Fund's placement agent (the "Placement Agent")
primarily to institutional customers of Bankers Trust that participate
in Bankers Trust's securities lending program.
For more information with respect to the expenses of the Fund see
"Management of the Fund and Trust" herein.
<PAGE>
FINANCIAL HIGHLIGHTS
The following table shows selected data for a share outstanding, total
investment return, ratios to average net assets and other supplemental
data for the Fund for the period indicated and has been audited by
Coopers & Lybrand L.L.P., the Fund's independent accountants, whose
report thereon appears in the Fund's Annual Report which is
incorporated by reference.
For the period
November 13, 1996
(Commencement of
Operations) to
JUNE 30, 1997
PER SHARE OPERATING PERFORMANCE:
NET ASSET VALUE, BEGINNING OF PERIOD...........................$ 1.00
-------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.................................... 0.03
Net Realized Gain from Investment Transactions........... 0.00+
-----
Total from Investment Operations.................................. 0.03
----
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income.................................... (0.03)
------
NET ASSET VALUE, END OF PERIOD.................................... $ 1.00
=======
TOTAL INVESTMENT RETURN........................................... 3.46%
SUPPLEMENTAL DATA AND RATIOS:
Net Assets, End of Period (000s omitted).................$ 2,748,056
Ratios to Average Net Assets:
Net Investment Income........................... 5.43%*
Expenses........................................ 0.12%*
Decrease Reflected in Above Expense Ratio Due
to Absorption of Expenses by Bankers Trust.. 0.01%*
* Annualized
+ Less than $0.01
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The Fund seeks a high level of current income consistent with
liquidity and the preservation of capital through investment in
high-quality money market instruments. The Fund offers investors a
convenient means of investing cash collateral received in connection
with securities lending transactions in a diversified portfolio of
short-term money market instruments.
There can be no assurance that the investment objective of the Fund
will be achieved. The Fund's investment objective is not a fundamental
policy and may be changed upon 30 days written notice to, but without
the approval of, the Fund's shareholders. If there is a change in the
Fund's investment objective, the Fund's shareholders should consider
whether the Fund remains an appropriate investment in light of their
then-current needs.
The following is a discussion of the various investments and
investment policies of the Fund. Additional information about the
investment policies of the Fund appears in the SAI of the Fund.
The Fund will attempt to achieve its investment objective by investing
in the following money market instruments:
OBLIGATIONS OF BANKS AND OTHER FINANCIAL INSTITUTIONS. The Fund may
invest in U.S. dollar-denominated fixed rate or variable rate
obligations of U.S. or foreign financial institutions, including
banks, which are rated in the highest short-term rating category by
any two nationally recognized statistical rating organizations
("NRSROs") (or one NRSRO if that NRSRO is the only such NRSRO which
rates such obligations) or, if not so rated, are believed by Bankers
Trust, acting under the supervision of the Board of Trustees of the
Fund, to be of comparable quality. Obligations of domestic and foreign
financial institutions in which the Fund may invest include, but are
not limited to, certificates of deposit, bankers' acceptances, bank
time deposits, commercial paper, and other U.S. dollar-denominated
instruments issued or supported by the credit of U.S. or foreign
financial institutions, including banks.
If Bankers Trust, acting under the supervision of the Board of
Trustees of the Fund, deems the instruments to present minimal credit
risk, the Fund may invest in obligations of foreign banks or foreign
branches and subsidiaries of U.S. and foreign financial institutions,
including banks. Investments in these obligations may entail risks
that are different from those of investments in obligations of U.S.
financial institutions, including banks, because of differences in
political, regulatory and economic systems and conditions. These risks
include future political and economic developments, currency blockage,
the possible imposition of withholding taxes on interest payments,
differing reserve requirements, reporting and recordkeeping
requirements and accounting standards, possible seizure or
nationalization of deposits, difficulty or inability of pursuing legal
remedies and obtaining judgments in foreign courts, possible
establishment of exchange controls or the adoption of other foreign
governmental restrictions that might affect adversely the payment of
principal and interest on financial institution obligations. Under
normal market conditions, the Fund will invest more than 25% of its
assets in the bank and other financial institution obligations
described above. The Fund's concentration of its investments in the
obligations of banks and other financial institutions will cause the
Fund to be subject to the risks peculiar to these industries to a
greater extent than if its investments were not so concentrated.
COMMERCIAL PAPER. The Fund may invest in fixed rate or variable rate
commercial paper, issued by U.S. or foreign entities. Commercial paper
when purchased by the Fund must be rated in the highest short-term
rating category by any two NRSROs (or one NRSRO if that NRSRO is the
only such NRSRO which rates such security) or, if not so rated, must
be believed by Bankers Trust, acting under the supervision of the
Board of Trustees of the Fund, to be of comparable quality. Any
commercial paper issued by a foreign entity and purchased by the Fund
must be U.S. dollar-denominated and must not be subject to foreign
withholding tax at the time of purchase. Investing in foreign
commercial paper generally involves risks similar to those described
above relating to obligations of foreign banks or foreign branches and
subsidiaries of U.S. and foreign banks.
VARIABLE RATE MASTER DEMAND NOTES. Variable rate master demand notes
are unsecured instruments that permit the indebtedness thereunder to
vary and provide for periodic adjustments in the interest rate.
Because variable rate master demand notes are direct lending
arrangements between the Fund and the issuer, they are not ordinarily
traded. Although no active secondary market may exist for these notes,
the Fund will purchase only those notes under which it may demand and
receive payment of principal and accrued interest daily or may resell
the note to a third party. While the notes are not typically rated by
credit rating agencies, issuers of variable rate master demand notes
must satisfy Bankers Trust, acting under the supervision of the Board
of Trustees of the Fund, that the same criteria as set forth above for
issuers of commercial paper are met. In the event an issuer of a
variable rate master demand note defaulted on its payment obligation,
the Fund might be unable to dispose of the note because of the absence
of a secondary market and could, for this or other reasons, suffer a
loss to the extent of the default. The face maturities of variable
rate notes may exceed 397 days. (See "Quality and Maturity of the
Fund's Securities" herein.)
U.S. GOVERNMENT OBLIGATIONS. The Fund may invest in obligations
issued or guaranteed by the U.S. Treasury or by agencies or
instrumentalities of the U.S. government ("U.S. Government
Obligations"). Obligations of certain agencies and instrumentalities
of the U.S. government, such as short-term obligations of the
Government National Mortgage Association, are supported by the "full
faith and credit" of the U.S. government; others, such as those of the
Export/Import Bank of the U.S., are supported by the right of the
issuer to borrow from the U.S. Treasury; others, such as those of the
Federal National Mortgage Association, are supported by the
discretionary authority of the U.S. government to purchase the
agency's obligations; and still others, such as those of the Student
Loan Marketing Association, are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. government
would provide financial support to U.S. government-sponsored
instrumentalities if it is not obligated to do so by law.
OTHER DEBT OBLIGATIONS. The Fund may invest in deposits, bonds, notes
and debentures and other debt obligations of issuers that at the time
of purchase have outstanding short-term obligations meeting the above
short-term rating requirements, or if there are no such short-term
ratings, are determined by Bankers Trust, acting under the supervision
of the Board of Trustees of the Fund, to be of comparable quality and
are rated in the top two highest long-term rating categories by two
NRSROs (or one NRSRO if that NRSRO is the only such NRSRO which rates
the security).
ASSET-BACKED SECURITIES. The Fund may also invest in securities
generally referred to as asset-backed securities, which directly or
indirectly represent a participation interest in, or are secured by
and payable from, a stream of payments generated by particular assets
such as motor vehicle or credit card receivables. Asset-backed
securities provide periodic payments that generally consist of
interest or principal payments. Consequently, the life of an
asset-backed security varies with the prepayment and loss experience
of the underlying assets.
REPURCHASE AGREEMENTS. The Fund may engage in repurchase agreement
transactions with banks and governmental securities dealers approved
by the Fund's Board of Trustees. Under the terms of a typical
repurchase agreement, the Fund would acquire U.S. Government
Obligations (or any other securities permitted by Rule 2a-7 under the
1940 Act) regardless of maturity, subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an
agreed price and time, thereby determining the yield during the Fund's
holding period. This arrangement results in a fixed rate of return
that is not subject to market fluctuations during the Fund's holding
period. The value of the underlying securities will be at least equal
at all times to the total amount of the repurchase obligations,
including interest. The Fund bears a risk of loss in the event that
the other party to a repurchase agreement defaults on its obligations
and the Fund is delayed in or prevented from exercising its rights to
dispose of the collateralized securities, including the risk of a
possible decline in the value of the underlying securities during the
period in which the Fund seeks to assert these rights. Bankers Trust,
acting under the supervision of the Board of Trustees of the Fund,
reviews the creditworthiness of those banks and dealers with which the
Fund enters into repurchase agreements and monitors on an ongoing
basis the value of the securities subject to repurchase agreements to
ensure that it is maintained at the required level.
REVERSE REPURCHASE AGREEMENTS. The Fund may enter into reverse
repurchase agreements. In a reverse repurchase agreement the Fund
agrees to sell portfolio securities to financial institutions such as
banks and broker-dealers and to repurchase them at a mutually agreed
date and price. At the time the Fund enters into a reverse repurchase
agreement it will earmark cash, U.S. Government Obligations or other
high grade, liquid debt instruments having a value equal to the
repurchase price, including accrued interest. Reverse repurchase
agreements involve the risk that the market value of the securities
sold by the Fund may decline below the repurchase price of the
securities. Reverse repurchase agreements are considered to be
borrowings by the Fund for purposes of the limitations described in
"Additional Investment Limitations" below and in the SAI. The Fund may
only enter into reverse repurchase agreements for temporary purposes
to satisfy redemptions and not for leverage.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. To secure prices deemed
advantageous at a particular time, the Fund may purchase securities on
a when-issued or delayed delivery basis, in which case delivery of the
securities occurs beyond the normal settlement period; payment for or
delivery of the securities would be made prior to the reciprocal
delivery or payment by the other party to the transaction. The Fund
will enter into when-issued or delayed delivery transactions for the
purpose of acquiring securities and not for the purpose of leverage.
When-issued securities purchased by the Fund may include securities
purchased on a "when, as and if issued" basis under which the issuance
of the securities depends on the occurrence of a subsequent event.
Securities purchased on a when-issued or delayed delivery basis may
expose the Fund to risk because the securities may experience
fluctuations in value prior to their actual delivery. The Fund does
not accrue income with respect to a when-issued or delayed delivery
security prior to its stated delivery date. Purchasing securities on a
when-issued or delayed-delivery basis can involve the additional risk
that the yield available in the market when the delivery takes place
may be higher than that obtained in the transaction itself. Upon
purchasing a security on a when-issued or delayed delivery basis, the
Fund will earmark cash, U.S. Government Obligations or other liquid
debt instruments in an amount at least equal to the when-issued or
delayed delivery commitment.
INVESTMENT IN OTHER INVESTMENT COMPANIES. In accordance with
applicable law, the Fund may invest its assets in other money market
funds with comparable investment objectives. In general, the Fund may
not (1) purchase more than 3% of any other money market fund's voting
stock; (2) invest more than 5% of its assets in any single money
market fund; and (3) invest more that 10% of its assets in other money
market funds.
ILLIQUID SECURITIES. The Fund may not invest more than 10% of its net
assets in securities which are illiquid or otherwise not readily
marketable (such securities may include securities which are subject
to legal or contractual restrictions on resale and repurchase
agreements with maturities over seven days). If a security becomes
illiquid after purchase by the Fund, the Fund will normally sell the
security as soon as is reasonably practicable unless if to do so would
not be in the best interests of shareholders.
CREDIT ENHANCEMENT. Certain of the Fund's acceptable investments may
be credit-enhanced by a guaranty, letter of credit, or insurance from
a third party. Any bankruptcy, receivership, default, or change in the
credit quality of the third party providing the credit enhancement
could adversely affect the quality and marketability of the underlying
security and could cause losses to the Fund and effect the Fund's
share price. The Fund may have more than 25% of its total assets
invested in securities issued by or credit-enhanced by banks or other
financial institutions.
QUALITY AND MATURITY OF THE FUND'S SECURITIES
The Fund will maintain a dollar-weighted average maturity of 90 days
or less. All securities in which the Fund invests will have or be
deemed to have remaining maturities of 397 days or less on the date of
their purchase, will be denominated in U.S. dollars and will have been
granted the required ratings established herein by two NRSROs (or one
NRSRO if that NRSRO is the only such NRSRO which provides such
ratings), or if not so rated, are believed by Bankers Trust, under the
supervision of the Fund's Board of Trustees, to be of comparable
quality. Currently, there are six rating agencies which have been
designated by the SEC as an NRSRO. These organizations and their
highest short-term rating category (which also may be modified by a
"+") are: Duff and Phelps Credit Rating Co., D-1; Fitch Investors
Services, LP, F-1; Moody's Investors Service Inc., Prime-1; Standard &
Poor's, A-1; IBCA Ltd. and IBCA Inc., A-1; Thomson BankWatch, Inc.,
TBW-1. A description of all short and long-term ratings is provided in
the Appendix to the SAI. Bankers Trust, acting under the supervision
of and procedures adopted by the Fund's Board of Trustees, will also
determine that all securities purchased by the Fund present minimal
credit risks. Bankers Trust will cause the Fund to dispose of any
security as soon as practicable if the security is no longer of the
requisite quality, unless such action would not be in the best
interest of the Fund. High-quality, short-term instruments may result
in a lower yield than instruments with a lower quality or longer term.
ADDITIONAL INVESTMENT LIMITATIONS
The Fund may not invest more than 25% of its total assets in the
securities of issuers in any single industry (excluding U.S.
Government Obligations and repurchase agreements collateralized by
U.S. Government Obligations), except that, under normal market
conditions, more than 25% of the total assets of the Fund will be
invested in obligations of banks and other financial institutions. As
an operating policy, the Fund may not invest more than 5% of its total
assets in the obligations of any one issuer except: (1) as may be
permitted by Rule 2a-7 under the 1940 Act; and (2) for U.S. Government
Obligations and repurchase agreements collateralized by U.S.
Government Obligations, which may be purchased without limitation. The
Fund is also authorized to borrow for temporary purposes to meet
redemptions, including entering into reverse repurchase transactions,
in an amount up to 10% of its total assets and to pledge its assets to
the same extent in connection with these borrowings. At the time of an
investment, the Fund's aggregate holdings of repurchase agreements
having a remaining maturity of more than seven calendar days (or which
may not be terminated within seven calendar days upon notice by the
Fund), time deposits having remaining maturities of more than seven
calendar days and other illiquid securities will not exceed 10% of the
Fund's net assets. If changes in the liquidity of certain securities
cause the Fund to exceed such 10% limit, the Fund will take steps to
bring the aggregate amount of its illiquid securities back below 10%
of its net assets as soon as practicable, unless such action would not
be in the best interest of the Fund. The Fund's limitations on
investment in a single industry and on borrowing may not be changed
without the approval of the shareholders of the Fund. All other
investment policies and limitations described in this Memorandum may
be changed by a vote of the Fund's Board of Trustees.
The SAI contains further information on the Fund's investment
restrictions.
RISK FACTORS
The Fund is designed as a cash management vehicle for institutional
investors seeking high current income approximating money market rates
while remaining liquid with a stable share price. The Fund adheres to
the following practices which enable it to attempt to maintain a $1.00
share price: limiting average dollar-weighted maturity of the
securities held by the Fund to 90 days or less; buying securities with
remaining maturities of 397 days or less as determined under Rule 2a-7
of the 1940 Act; and buying only high-quality securities with minimal
credit risks. The Fund cannot guarantee a $1.00 share price, but these
practices help to minimize any price fluctuations that might result
from rising or declining interest rates. While the Fund invests in
high-quality money market securities, investors should be aware that
an investment in the Fund is not without risk. All money market
instruments, including U.S. Government Obligations, can change in
value when interest rates or an issuer's creditworthiness changes.
It is expected that money used to purchase Fund shares will be
comprised primarily of cash collateral which the Fund's institutional
investors receive in connection with their participation in Bankers
Trust's securities lending program. The amount of such collateral is
subject to periodic fluctuation, and accordingly the Fund may
experience large purchases and redemptions over a relatively short
time period which may impact the Fund's ability to optimize cash
management. To assist the Fund in remaining fully invested, pursuant
to its request, the Fund has received an order from the SEC granting
the Fund and Bankers Trust permission to jointly enter into repurchase
agreements and other investments with non-affiliated banks,
broker-dealers or other issuers with respect to amounts to be received
on any day. Such investments will be apportioned between the Fund and
Bankers Trust in such a manner as to maximize the investment of cash
by the Fund.
NET ASSET VALUE
On each day in which the Fund is open (each such day being a
"Valuation Day"), the NAV per share of the Fund is calculated at 5:30
p.m., Eastern time. The Fund is currently open each day, Monday
through Friday, except (a) January 1st, Martin Luther King, Jr.'s
Birthday (the third Monday in January), Presidents' Day (the third
Monday in February), Memorial Day (the last Monday in May), July 4th,
Labor Day (the first Monday in September), Columbus Day (the second
Monday in October), Veteran's Day (November 11th), Thanksgiving Day
(the last Thursday in November) and December 25th; and (b) the
preceding Friday or the subsequent Monday when one of the calendar
determined holidays falls on a Saturday or Sunday, respectively.
The NAV per share of the Fund is computed by dividing the value of the
Fund's assets, less all liabilities, by the total number of its shares
outstanding. The Fund's NAV per share will normally be $1.00.
The Fund values its portfolio securities by using the amortized cost
method of valuation. This method involves valuing each security held
by the Fund at its cost at the time of its purchase and thereafter
assuming a constant amortization to maturity of any discount or
premium. Accordingly, immaterial fluctuations in the market value of
the securities held by the Fund will not be reflected in the Fund's
NAV. All cash receivables and current payments are valued at face
value. Other assets are valued at fair value as determined in good
faith by the Fund's Board of Trustees.
PURCHASE AND REDEMPTION OF SHARES
PURCHASE OF SHARES
The Fund accepts purchase orders for shares of the Fund at the NAV
per share of the Fund next determined on each Valuation Day. See "Net
Asset Value" herein. There is no sales charge on the purchase of
shares. There is no minimum required initial investment amount. Shares
of the Fund may be purchased in only those states where they may be
lawfully sold. The Fund and Edgewood reserve the right to reject any
purchase order.
Investors in the Fund must qualify as both (1) "Accredited Investors"
as defined under Regulation D of the Securities Act of 1933, as
amended and (2) institutional investors.
Purchase orders for shares of the Fund will receive, on any Valuation
Day, the NAV next determined following receipt by Bankers Trust, as
the Fund's transfer agent (the "Transfer Agent"), of such order. If a
purchase order is transmitted to the Transfer Agent prior to 5:30
p.m., Eastern time, and if payment in the form of federal funds is
received on that day by Bankers Trust, as the Fund's custodian (the
"Custodian"), the shareholder will be invested as of that day and will
accrue the dividend declared on that day.
It is anticipated that the majority of investors in the Fund will
issue standing orders, effective on or before 5:30 p.m., Eastern time
of each day on which the Fund is open, to invest in the Fund cash
collateral received in connection with securities lending
transactions. Shares must be purchased in accordance with procedures
established by Bankers Trust and the Placement Agent in connection
with customers' accounts.
Certificates for shares will not be issued. Each shareholder's account
will be maintained by the Transfer Agent. The Transfer Agent may
subcontract with other service providers to perform certain services.
REDEMPTION OF SHARES
Shareholders may redeem shares at the NAV per share next determined
on each Valuation Day. It is anticipated that the majority of
investors in the Fund will issue standing orders to Bankers Trust to
redeem shares of the Fund as necessary in connection with such
investors' participation in Bankers Trust's securities lending
program. Redemption requests for shares of the Fund transmitted to the
Transfer Agent prior to 5:30 p.m., Eastern time, on each Valuation Day
will be redeemed on that day at the NAV per share next determined, and
the redemption proceeds normally will be delivered to the
shareholder's account on that day; no dividend will accrue on the day
of redemption. Payments for redemptions will in any event be made
within seven calendar days following receipt of the request. Within
the first five Valuation Days of each month, the Fund pays dividends
for the preceding month. Dividends will not be reinvested in the Fund.
Redemption orders are processed without charge by the Fund.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Trust intends for the Fund to qualify annually and to elect to be
treated as a "regulated investment company" under the Internal Revenue
Code of 1986, as amended (the "Code").
Provided that the Fund continues to qualify as a regulated investment
company, the Fund will not be subject to U.S. Federal income tax on
its investment company taxable income and net capital gains (the
excess of net long-term capital gains over net short-term capital
losses), if any, that it distributes to shareholders. The Fund intends
to distribute to its shareholders, at least annually, substantially
all of its investment company taxable income and net capital gains,
and therefore does not anticipate incurring a Federal income tax
liability.
The Fund determines its net income and realized capital gains, if
any, on each Valuation Day at 5:30 p.m. Eastern time. The Fund
declares dividends from its net income on each Valuation Day and pays
dividends in cash for the preceding month within the first five
Valuation Days of each month. The Fund reserves the right to include
realized short-term gains, if any, in such daily dividends.
Distributions of the Fund's realized long-term capital gains, if any,
and any undistributed net realized short-term capital gains are
normally declared and paid annually in cash at the end of the fiscal
year in which they were earned to the extent they are not offset by
any capital loss carryforwards.
Dividends paid out of the Fund's investment company taxable income
will be taxable to a U.S. shareholder as ordinary income, provided
that such shareholder is not a tax-exempt entity. Distributions of net
capital gains, if any, designated as capital gain dividends are
taxable as long-term capital gains, regardless of how long the
shareholder has held the Fund's shares, and are not eligible for the
dividends-received deduction applicable to corporations. Shareholders
should consult their own tax adviser concerning the application of
Federal, state and local taxes to the distributions they receive from
the Fund.
The Trust is organized as a Massachusetts business trust and, under
current law, neither the Trust nor the Fund is liable for any income
or franchise tax in the Commonwealth of Massachusetts, provided that
the Fund continues to qualify as a regulated investment company under
Subchapter M of the Code.
PERFORMANCE INFORMATION AND REPORTS
From time to time, the Fund may report its "current yield" and/or
"effective yield" to investors. The Fund will not publicly advertise
its performance, nor make its performance figures available to
reporting services. All yield figures are based on historical earnings
and are not intended to indicate future performance. The "current
yield" of the Fund refers to the income generated by an investment in
the Fund over a seven- day period (which period will be stated in the
report). This income is then "annualized;" that is, the amount of
income generated by the investment during that week is assumed to be
generated each week over a 52-week period and is shown as a percentage
of the investment. The "effective yield" is calculated similarly but,
when annualized, the income earned by an investment in the Fund is
assumed to be reinvested. The "effective yield" will be slightly
higher than the "current yield" because of the compounding effect of
this assumed reinvestment.
Yield is a function of the quality, composition and maturity of the
securities held by the Fund and operating expenses of the Fund. In
particular, the Fund's yield will rise and fall with short-term
interest rates, which can change frequently and sharply. In periods of
rising interest rates, the yield of the Fund will tend to be somewhat
lower than prevailing market rates, and in periods of declining
interest rates, the yield will tend to be somewhat higher. In
addition, when interest rates are rising, the inflow of net new money
to the Fund from the continuous sale of its shares will likely be
invested by the Fund in instruments producing higher yields than the
balance of the Fund's securities, thereby increasing the current yield
of the Fund. In periods of falling interest rates, the opposite can be
expected to occur. Accordingly, yields will fluctuate and do not
necessarily indicate future results. While yield information may be
useful in reviewing the performance of the Fund, it may not provide a
basis for comparison with bank deposits, other fixed rate investments,
or other investment companies that may use a different method of
calculating yield.
From time to time reports to shareholders may compare the yield of the
Fund to that of other mutual funds with similar investment objectives
or to that of a particular index. The yield of the Fund might be
compared with, for example, the IBC/Donoghue's Taxable First Tier
Institutional Only Money Fund Average, which is an average compiled by
IBC/Donoghue's Money Fund Report, a widely recognized, independent
publication that monitors the performance of money market mutual
funds. Similarly, the yield of the Fund might be compared with
rankings prepared by Micropal Limited and/or Lipper Analytical
Services, Inc., which are widely recognized, independent services that
monitor the investment performance of mutual funds. The yield of the
Fund might also be compared with the average yield reported by the
Bank Rate Monitor for money market deposit accounts offered by the 50
leading banks and thrift institutions in the top five standard
metropolitan areas. Shareholders may make inquiries regarding the
Fund's performance by contacting the Fund at (212) 250-6934.
Shareholders will receive financial reports semi-annually that include
the Fund's financial statements, including a listing of investment
securities held by the Fund at those dates. Annual reports are audited
by independent accountants.
MANAGEMENT OF THE FUND AND TRUST
BOARD OF TRUSTEES
The affairs of the Fund and Trust are managed under the supervision of
the Trust's Board of Trustees (referred to herein as the "Fund's Board
of Trustees"). For more information with respect to the Fund's Board
of Trustees, see "Management of the Trust" in the SAI. By virtue of
the responsibilities assumed by Bankers Trust, as administrator of the
Trust, the Trust does not need employees other than its executive
officers. None of the executive officers of the Trust devotes full
time to the affairs of the Fund or Trust.
INVESTMENT ADVISER
Bankers Trust Company, a New York banking corporation with principal
offices at 130 Liberty Street, New York, New York 10006, is a wholly
owned subsidiary of Bankers Trust New York Corporation. Bankers Trust
conducts a variety of general banking and trust activities and is a
major wholesale supplier of financial services to the international
and domestic institutional market. As of June 30, 1997, Bankers Trust
New York Corporation was the seventh largest bank holding company in
the United States with total assets of approximately $129 billion.
Bankers Trust is a worldwide merchant bank dedicated to serving the
needs of corporations, government agencies, financial institutions and
private clients through a global network of over 120 offices in more
than 50 countries. Investment management is a core business of Bankers
Trust, built in a tradition of excellence from its roots as a trust
bank founded in 1903. The scope of Bankers Trust's investment
management capability is unique due to its leadership positions in
both active and passive quantitative management and its presence in
major equity and fixed income markets around the world. Bankers Trust
is one of the nation's largest and most experienced investment
managers with approximately $240 billion in assets under management
globally.
Bankers Trust, subject to the supervision and direction of the Fund's
Board of Trustees, manages the Fund in accordance with the Fund's
investment objective and stated investment policies, makes investment
decisions for the Fund, places orders to purchase and sell securities
and other financial instruments on behalf of the Fund and employs
professional investment managers and securities analysts who provide
research services to the Fund. All orders for investment transactions
on behalf of the Fund are placed by Bankers Trust with broker-dealers
and other financial intermediaries that it selects, including those
affiliated with Bankers Trust. A Bankers Trust affiliate will be used
in connection with a purchase or sale of an investment for the Fund
only if Bankers Trust believes that the affiliate's charge for the
transaction does not exceed usual and customary levels. The Fund will
not invest in obligations for which Bankers Trust or any of its
affiliates is the ultimate obligor or accepting bank. The Fund may,
however, invest in the obligations of correspondents and customers of
Bankers Trust.
Under its Investment Advisory Agreement, Bankers Trust receives a fee
from the Fund, computed daily and paid monthly, at the annual rate of
0.10% of the average daily net assets of the Fund.
Bankers Trust has been advised by its counsel that, in counsel's
opinion, Bankers Trust currently may perform the services for the Fund
and Trust described in this Memorandum and the SAI without violation
of the Glass-Steagall Act or other applicable banking laws or
regulations. State laws on this issue may differ from the
interpretations of relevant Federal law and banks and financial
institutions may be required to register as dealers pursuant to state
securities law.
ADMINISTRATOR
Under its Administration and Services Agreement with the Trust,
Bankers Trust acts as administrator, transfer agent, shareholder
servicing agent, custodian and dividend disbursing agent. As the
Fund's administrator, Bankers Trust calculates the NAV of the Fund and
generally assists the Board of Trustees of the Fund in all aspects of
the administration and operation of the Trust. Under its
Administration and Services Agreement with the Trust, Bankers Trust
receives a fee, computed daily and paid monthly, at the annual rate of
0.02% of the average daily net assets of the Fund. This fee is
included in the Fund's other expenses. (See "Summary of the Fund
Expenses" herein) Under the Administration and Services Agreement,
Bankers Trust may delegate one or more of its responsibilities to
others, including affiliates of Edgewood, at Bankers Trust's expense.
For more information, see the SAI.
PLACEMENT AGENT
Under its Placement Agent Agreement with the Fund, Edgewood, as
Placement Agent, serves as the Trust's principal underwriter on a best
efforts basis. In addition, Edgewood and its affiliates provide the
Trust with office facilities and currently provide administration and
distribution services for other registered investment companies. The
principal business address of Edgewood is Clearing Operations, P.O.
Box 897, Pittsburgh, PA 15230- 0897.
SERVICE AGENT
Bankers Trust acts as service agent ("Service Agent") pursuant to its
Administration and Services Agreement with the Fund and receives no
additional compensation from the Fund for such shareholder services.
The services provided by Bankers Trust as Service Agent may include
establishing and maintaining shareholder accounts, processing purchase
and redemption transactions, performing shareholder sub-accounting,
answering client inquiries regarding the Fund, transmitting proxy
statements, updating prospectuses and other communications to
shareholders and, with respect to meetings of shareholders,
collecting, tabulating and forwarding to the Trust executed proxies
and obtaining such other information and performing such other
services as the shareholders may reasonably request and agree upon
with the Service Agent.
CUSTODIAN AND TRANSFER AGENT
Bankers Trust acts as custodian of the assets of the Fund and serves
as the transfer agent for the Fund under the Administration and
Services Agreement with the Fund.
ORGANIZATION OF THE TRUST
The Trust was organized on March 26, 1990, under the laws of the
Commonwealth of Massachusetts. The Fund is a separate series of the
Trust. The Trust offers shares of beneficial interest of separate
series, par value $0.001 per share. The shares of the other series of
the Trust are offered through separate prospectuses. No series of
shares has any preference over any other series.
The Trust is an entity commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of such a business trust
may, under certain circumstances, be held personally liable as
partners for its obligations. However, the risk of a shareholder
incurring financial loss on account of shareholder liability is
limited to circumstances in which both inadequate insurance existed
and the Trust itself was unable to meet its obligations.
When matters are submitted for shareholder vote, shareholders of the
Fund will have one vote for each full share held and proportionate,
fractional votes for fractional shares held. A separate vote of the
Fund is required on any matter affecting the Fund on which
shareholders are entitled to vote. Shareholders of the Fund are not
entitled to vote on Trust matters that do not affect the Fund. There
normally will be no meetings of shareholders for the purpose of
electing Trustees unless and until such time as less than a majority
of Trustees holding office have been elected by shareholders, at which
time the Trustees then in office will call a shareholders' meeting for
the election of Trustees. Any Trustee may be removed from office upon
the vote of shareholders holding at least two-thirds of the Trust's
outstanding shares at a meeting called for that purpose. The Trustees
are required to call such a meeting upon the written request of
shareholders holding at least 10% of the Trust's outstanding shares.
Shareholders of all the series of the Trust will vote together to
elect Trustees of the Trust and for certain other matters. Under
certain circumstances, the shareholders of one or more series could
control the outcome of these votes.
As of September 12, 1997, BT Funds Securities Lending Group, New York,
New York, acting in various capacities for numerous accounts, was the
owner of record of approximately 2,867,876,954 shares (100%) of the
Fund, and therefore, may, for certain purposes, be deemed to control
the Fund and be able to affect the outcome of certain matters
presented for a vote of shareholders.
EXPENSES OF THE TRUST
The Fund bears its own expenses. Operating expenses for the Fund
generally consist of all costs not specifically borne by Bankers
Trust, including investment advisory fees, administration and services
fees, fees for necessary professional services, amortization of
organizational expenses, the costs of regulatory compliance and costs
associated with maintaining legal existence and shareholder relations.
<PAGE>
BT INSTITUTIONAL FUNDS
INSTITUTIONAL DAILY ASSETS FUND
Investment Adviser and Administrator
BANKERS TRUST COMPANY
Placement Agent
EDGEWOOD SERVICES, INC.
Custodian and Transfer Agent
BANKERS TRUST COMPANY
Independent Accountants
COOPERS & LYBRAND LLP
Counsel
WILLKIE FARR & GALLAGHER
-----------------------------------------
No person has been authorized to give any information or to make any
representations other than those contained in the Fund's Confidential
Private Offering Memorandum, its Confidential Statement of Additional
Information in connection with the offering of the Fund's shares and,
if given or made, such other information or representations must not
be relied on as having been authorized by the Trust. This Confidential
Private Offering Memorandum does not constitute an offer in any state
in which, or to any person to whom, such offer may not lawfully be
made.
- ---------------------------------------
BT INVESTMENT FUNDS
INSTITUTIONAL DAILY ASSETS FUND
PART B
ITEM 10. COVER PAGE.
Not Applicable
ITEM 11. TABLE OF CONTENTS.
See "Table of Contents" in the Confidential Statement of Additional
Information Attached hereto.
ITEM 12. GENERAL INFORMATION AND HISTORY
See "Appendix" in the Confidential Statement of Additional Information
Attached hereto.
ITEM 13. INVESTMENT OBJECTIVE AND POLICIES
See "Investment Objective and Policies" and "Investment Restrictions"
in the Confidential Statement of Additional Information Attached
hereto.
ITEM 14. MANAGEMENT OF THE TRUST AND THE PORTFOLIO
See "Management of the Trust" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
See "Trustee Compensation Table" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 16. INVESTMENT ADVISORY, MANAGEMENT AND OTHER SERVICES
See "Investment Adviser," "Custodian and Transfer Agent," and "Counsel
and Independent Accountants" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 17. PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS
See "Portfolio Transactions" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 18. CAPITAL STOCK AND OTHER SECURITIES
See "Organization of the Trust" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 19. PURCHASE, REDEMPTION AND PRICING OF SECURITIES
See "Purchase and Redemption Information" in the Confidential
Statement of Additional Information Attached hereto.
ITEM 20. TAX STATUS
See "Taxes" in the Confidential Statement of Additional Information Attached
hereto.
ITEM 21. UNDERWRITERS
Not Applicable
ITEM 22. CALCULATIONS OF PERFORMANCE DATA
See "Performance Information" in the Confidential Statement of
Additional Information Attached hereto.
ITEM 23. FINANCIAL STATEMENTS
See "Financial Statements" in the Confidential Statement of Additional
Information Attached hereto.
<PAGE>
Do Not Copy or Circulate
INVESTOR ......... COPY #
BT INSTITUTIONAL FUNDS
INSTITUTIONAL DAILY ASSETS FUND
October 7, 1997
CONFIDENTIAL STATEMENT OF ADDITIONAL INFORMATION
BT Institutional Funds (the "Trust") is an open-end management
investment company that offers investors a selection of investment
portfolios, each having distinct investment objectives and policies.
This Confidential Statement of Additional Information relates to the
Institutional Daily Assets Fund (the "Fund"). The Fund seeks a high
level of current income consistent with liquidity and the preservation
of capital through investment in high-quality money market
instruments.
Shares of the Fund are sold by Edgewood Services, Inc. ("Edgewood"),
the Trust's Distributor (and the Fund's Placement Agent), primarily to
clients and customers of Bankers Trust Company ("Bankers Trust") that
participate in Bankers Trust's securities lending program. Bankers
Trust serves as the Fund's investment adviser (the "Adviser").
THE SECURITIES DESCRIBED HEREIN ARE OFFERED PURSUANT TO AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND HAVE NOT BEEN REGISTERED WITH OR
APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR
ANY OTHER REGULATORY AUTHORITY OF ANY JURISDICTION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS CONFIDENTIAL STATEMENT OF
ADDITIONAL INFORMATION. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
SHARES OF THE FUND ARE BEING OFFERED ONLY TO INVESTORS WHO QUALIFY AS
BOTH (1) ACCREDITED INVESTORS AS DEFINED UNDER REGULATION D UNDER THE
SECURITIES ACT AND (2) INSTITUTIONAL INVESTORS. SHARES OF THE FUND ARE
NOT BEING OFFERED TO INDIVIDUALS OR TO ENTITIES ORGANIZED FOR THE
PURPOSE OF INVESTING ON BEHALF OF INDIVIDUALS. NO RESALE OF SHARES MAY
BE MADE UNLESS THE SHARES ARE SUBSEQUENTLY REGISTERED UNDER THE
SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
THIS CONFIDENTIAL STATEMENT OF ADDITIONAL INFORMATION HAS BEEN
PREPARED ON A CONFIDENTIAL BASIS SOLELY FOR THE INFORMATION OF THE
RECIPIENT AND MAY NOT BE REPRODUCED, PROVIDED TO OTHERS OR USED FOR
ANY OTHER PURPOSE.
NO PERSON HAS BEEN AUTHORIZED TO MAKE REPRESENTATIONS OR ANY
INFORMATION WITH RESPECT TO THE SHARES, EXCEPT THE INFORMATION
CONTAINED HEREIN OR IN THE TRUST'S REGISTRATION STATEMENT FILED UNDER
THE 1940 ACT.
INVESTORS WILL BE REQUIRED TO REPRESENT THAT THEY MEET CERTAIN
FINANCIAL REQUIREMENTS AND THAT THEY ARE FAMILIAR WITH AND UNDERSTAND
THE TERMS, RISKS AND MERITS OF AN INVESTMENT IN THE FUND.
The Fund's confidential private offering memorandum, which may be
amended from time to time (the "Confidential Private Offering
Memorandum"), is dated October 7, 1997. The Confidential Private
Offering Memorandum provides the basic information investors should
know before investing, and may be obtained without charge by calling
the Fund at (212) 250-6934. This Confidential Statement of Additional
Information, which is not a Confidential Private Offering Memorandum,
is intended to provide additional information regarding the activities
and operations of the Trust and should be read in conjunction with the
Confidential Private Offering Memorandum. Capitalized terms not
otherwise defined in this Confidential Statement of Additional
Information have the meanings accorded to them in the Fund's
Confidential Private Offering Memorandum.
BANKERS TRUST COMPANY
Investment Adviser and Administrator
EDGEWOOD SERVICES, INC.
Placement Agent
Clearing Operations, P.O. Box 987 Pittsburgh, PA
15230-0897
<PAGE>
TABLE OF CONTENTS
INVESTMENT OBJECTIVE AND POLICIES 11
PORTFOLIO TRANSACTIONS 33
NET ASSET VALUE 3
PURCHASE AND REDEMPTION INFORMATION 44
MANAGEMENT OF THE TRUST 55
ORGANIZATION OF THE TRUST 88
TAXES 88
PERFORMANCE INFORMATION 99
FINANCIAL STATEMENTS 99
APPENDIX 1010
<PAGE>
23
INVESTMENT OBJECTIVE AND POLICIES
The Fund's Confidential Private Offering Memorandum discusses the
investment objective of the Fund and the policies to be employed to
achieve that objective. This section contains supplemental information
concerning the types of securities and other instruments in which the
Fund may invest, the investment policies and portfolio strategies that
the Fund may utilize and certain risks attendant to those investments,
policies and strategies.
OBLIGATIONS OF BANKS AND OTHER FINANCIAL INSTITUTIONS
For purposes of the Fund's investment policies with respect
to obligations of financial institutions including banks, the
assets of a bank will be deemed to include the assets of its
domestic and foreign branches. Obligations of foreign
branches of U.S. banks and foreign banks may be general
obligations of the parent bank in addition to the issuing
bank or may be limited by the terms of a specific obligation
and by U.S. or foreign government regulation, as applicable.
If Bankers Trust, acting under the supervision of the Board
of Trustees, deems the instruments to present minimal credit
risk, the Fund may invest in U.S. or foreign financial
institutions, including; but not limited to, banks located in
the United Kingdom, Grand Cayman Island, Nassau, Japan and
Canada. Investments in these obligations may entail risks
that are different from those of investments in obligations
of U.S. domestic banks or other financial institutions
because of differences in political, regulatory and economic
systems and conditions. These risks include future political
and economic developments, currency blockage, the possible
imposition of withholding taxes on interest payments,
possible seizure or nationalization of foreign deposits,
difficulty or inability of pursuing legal remedies and
obtaining judgments in foreign courts, possible establishment
of exchange controls or the adoption of other foreign
governmental restrictions that might affect adversely the
payment of principal and interest on bank obligations.
Foreign branches of U.S. banks and foreign banks may also be
subject to less stringent reserve requirements and to
different accounting, auditing, reporting and recordkeeping
standards that those applicable to domestic branches of U.S.
banks.
COMMERCIAL PAPER
Commercial paper obligations in which the Fund may invest are
short-term, unsecured negotiable promissory notes of U.S. or
foreign entities that at the time of purchase meet the rating
criteria described in the Confidential Private Offering
Memorandum. Investments in foreign commercial paper generally
involve risks similar to those described above relating to
obligations of financial institutions, including foreign
banks or foreign branches and subsidiaries of U.S. and
foreign banks.
U.S. GOVERNMENT OBLIGATIONS
The Fund may invest in direct obligations issued by the U.S.
Treasury or in obligations issued or guaranteed by the U.S.
Treasury or by agencies or instrumentalities of the U.S.
government ("U.S. Government Obligations"). Certain U.S.
Government Obligations, such as those issued by the
Government National Mortgage Association ("GNMA"), are
supported by the "full faith and credit" of the U.S.
government; others, such as those of the Export/Import Bank
of the U.S., are supported by the right of the issuer to
borrow from the U.S. Treasury; others, such as those of the
Federal National Mortgage Association are solely the
obligations of the issuing entity, but are supported by the
discretionary authority of the U.S. government to purchase
the agency's obligations; and still others, such as those of
the Student Loan Marketing Association, are supported by the
credit of the instrumentality. No assurance can be given that
the U.S. government would provide financial support to U.S.
Government-sponsored instrumentalities if it is not obligated
to do so by law.
Examples of the types of U.S. Government Obligations that the
Fund may hold in addition to those described above include,
direct U.S. Treasury obligations, the obligations of U.S.
government agencies or instrumentalities, such as the: Farm
Credit System, including the National Bank for Cooperatives,
Farm Credit Banks, and Banks for Cooperatives; Farmers Home
Administration; Federal Housing Administration; Federal Home
Loan Banks; Federal Home Loan Mortgage Corporation; Federal
Housing Administration; Small Business Administration;
General Services Administration; and Maritime
Administration.
REVERSE REPURCHASE AGREEMENTS
The Fund may borrow funds for temporary or emergency
purposes, such as meeting larger than anticipated redemption
requests, and not for leverage, by among other things,
agreeing to sell portfolio securities to financial
institutions such as banks and broker-dealers and to
repurchase them at a mutually agreed date and price (a
"reverse repurchase agreement"). At the time the Fund enters
into a reverse repurchase agreement it will place in a
segregated custodial account cash, U.S. Government
Obligations or high-grade liquid debt obligations having a
value equal to the repurchase price, including accrued
interest. Reverse repurchase agreements involve the risk that
the market value of the securities sold by the Fund may
decline below the repurchase price of those securities.
Reverse repurchase agreements are considered to be borrowings
by the Fund.
INVESTMENTS IN OTHER INVESTMENT COMPANIES
Since the investment companies in which the Fund may invest
have their own operating expenses, the Fund's investment in these
investment companies may result in the duplication of expenses.
RATING SERVICES
Ratings represent the opinions of rating services as to the quality of
the securities that they undertake to rate. It should be emphasized,
however, that ratings are relative and subjective and are not absolute
standards of quality. Although these ratings are an initial criterion
for selection of portfolio investments, Bankers Trust also makes its
own evaluation of these securities, subject to review by the Board of
Trustees of the Trust. After purchase by the Fund, an obligation may
cease to be rated or its rating may be reduced below the minimum
required for purchase by the Fund. Neither event would require the
Fund to eliminate the obligation from its portfolio, but Bankers Trust
will consider such an event in its determination of whether the Fund
should continue to hold the obligation. A description of the ratings
used herein and in the Confidential Private Offering Memorandum is set
forth in the Appendix to this Confidential Statement of Additional
Information.
THE FOLLOWING FUNDAMENTAL INVESTMENT RESTRICTIONS AND NON-FUNDAMENTAL
INVESTMENT OPERATING POLICIES HAVE BEEN ADOPTED BY THE TRUST, WITH
RESPECT TO THE FUND BECAUSE OF REQUIREMENTS OF FEDERAL SECURITIES LAWS
OR REGULATIONS. UNLESS AN INVESTMENT INSTRUMENT OR TECHNIQUE IS
DESCRIBED IN THE CONFIDENTIAL PRIVATE OFFERING MEMORANDUM, THE FUND
MAY NOT INVEST IN THAT INVESTMENT INSTRUMENT OR ENGAGE IN THAT
INVESTMENT TECHNIQUE.
INVESTMENT RESTRICTIONS
The investment restrictions below have been adopted by the Trust with
respect to the Fund as fundamental policies. Under the 1940 Act, a
"fundamental" policy may not be changed without the "vote of a
majority of the outstanding voting securities" of the Fund which is
defined in the 1940 Act as the lesser of (a) 67% or more of the shares
of the Fund present at a shareholder meeting of the Fund if the
holders of more than 50% of the outstanding shares of the Fund are
present or represented by proxy, or (b) more than 50% of the
outstanding shares of the Fund. The percentage limitations contained
in the restrictions listed below apply at the time of the purchase of
the securities.
As a matter of fundamental policy, the Fund may not:
1. Borrow money or mortgage or hypothecate assets of the Fund, except
that in an amount not to exceed 10% of the current value of the
Fund's total assets, it may borrow money as a temporary measure
for extraordinary or emergency purposes and enter into reverse
repurchase agreements or dollar roll transactions, and except that
it may pledge, mortgage or hypothecate not more than 10% of such
assets to secure such borrowings (it is intended that money would
be borrowed only from banks or through reverse repurchase
agreements and only either to accommodate redemption requests
while effecting an orderly liquidation of portfolio securities or
to maintain liquidity in the event of an unanticipated failure to
complete a portfolio security transaction or other similar
situations), provided that collateral arrangements with respect to
options and futures, including deposits of initial deposit and
variation margin, are not considered a pledge of assets for
purposes of this restriction and except that assets may be pledged
to secure letters of credit solely for the purpose of
participating in a captive insurance company sponsored by the
Investment Company Institute; for additional related restrictions,
see clause (i) under the caption "Federal Restrictions" below. (As
an operating policy, the Fund may not engage in dollar roll
transactions or options and futures);
2. Underwrite securities issued by other persons except insofar as the Trust
or the Fund may technically be deemed an underwriter under the Securities
Act of 1933, as amended (the "1933 Act"), in selling a portfolio security;
3. Make loans to other persons except (a) through the use of repurchase
agreements or the purchase of short-term obligations or (b) by purchasing
a portion of an issue of debt securities of types distributed publicly or
privately;
4. Purchase or sell real estate (including limited partnership
interests but excluding securities secured by real estate or
interests therein), interests in oil, gas or mineral leases,
commodities or commodity contracts (except futures and option
contracts) in the ordinary course of business (except that the
Fund may hold and sell, for the Fund's portfolio, real estate
acquired as a result of the Fund's ownership of securities);
5. Concentrate its investments in any particular industry (excluding
U.S. Government Obligations), except that the Fund will invest
more than 25% of its total assets in the obligations of banks and
other financial institutions, and if it is deemed appropriate for
the achievement of the Fund's investment objective, up to 25% of
its total assets may be invested in any other industry; and
6. Issue any "senior security" (as that term is defined in the 1940
Act) if such issuance is specifically prohibited by the 1940 Act
or the rules and regulations promulgated thereunder, provided that
collateral arrangements with respect to options and futures,
including deposits of initial deposit and variation margin, are
not considered to be the issuance of a senior security for
purposes of this restriction.
PORTFOLIO TURNOVER
The Fund may attempt to increase yield by trading to take advantage of
short-term market variations, which results in higher portfolio
turnover. However, this policy does not result in higher brokerage
commissions to the Fund as the purchases and sales of portfolio
securities are usually effected as principal transactions. The Fund's
turnover rate is not expected to have a material effect on its income
and has been and is expected to be zero for regulatory reporting
purposes.
PORTFOLIO TRANSACTIONS
Decisions to buy and sell securities and other financial instruments
for the Fund are made by Bankers Trust, which also is responsible for
placing these transactions, subject to the overall review of the
Trust's Board of Trustees. Although investment requirements for the
Fund are reviewed independently from those of the other accounts
managed by Bankers Trust, investments of the type the Fund may make
may also be made by these other accounts. When the Fund and one or
more other accounts managed by Bankers Trust are prepared to invest
in, or desire to dispose of, the same security or other financial
instrument, available investments or opportunities for sales will be
allocated in a manner believed by Bankers Trust to be equitable to
each. In some cases, this procedure may affect adversely the price
paid or received by the Fund or the size of the position obtained or
disposed of by the Fund.
Purchases and sales of securities on behalf of the Fund will be
principal transactions. These securities are normally purchased
directly from the issuer or from an underwriter or market maker for
the securities. The cost of securities purchased from underwriters
includes an underwriting commission or concession and the prices at
which securities are purchased from and sold to dealers include a
dealer's mark-up or mark-down. U.S. Government Obligations are
generally purchased from underwriters or dealers, although certain
newly issued U.S. Government Obligations may be purchased directly
from the U.S. Treasury or from the issuing agency or instrumentality.
Over-the-counter purchases and sales are transacted directly with
principal market makers except in those cases in which better prices
and executions may be obtained elsewhere and principal transactions
are not entered into with persons affiliated with the Fund except
pursuant to exemptive rules or orders adopted by the Securities and
Exchange Commission (the "SEC"). Under rules adopted by the SEC,
broker-dealers may not execute transactions on the floor of any
national securities exchange for the accounts of affiliated persons,
but may effect transactions by transmitting orders for execution.
In selecting dealers to execute portfolio transactions on behalf of
the Fund, Bankers Trust seeks the best overall terms available. In
assessing the best overall terms available for any transaction,
Bankers Trust will consider the factors it deems relevant, including
the breadth of the market in the investment, the price of the
investment and the financial condition and execution capability of the
dealer for the specific transaction and on a continuing basis. In
addition, Bankers Trust is authorized, in selecting parties to execute
a particular transaction and in evaluating the best overall terms
available, to consider the "brokerage services," but not "research
services" (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934, as amended) provided to the Fund.
NET ASSET VALUE
The Confidential Private Offering Memorandum discusses the time at
which the NAV per share of the Fund is determined for purposes of
sales and redemptions.
The valuation of the Fund's securities is based on their amortized
cost, which does not take into account unrealized capital gains or
losses. Amortized cost valuation involves initially valuing an
instrument at its cost and thereafter assuming a constant amortization
to maturity of any discount or premium, generally without regard to
the impact of fluctuating interest rates on the market value of the
instrument. Although this method provides certainty in valuation, it
may result in periods during which value, as determined by amortized
cost, is higher or lower than the price the Fund would receive if it
sold the instrument.
The Fund's use of the amortized cost method of valuing its securities
is permitted by a rule adopted by the SEC. Under this rule, the Fund
must maintain a dollar-weighted average portfolio maturity of 90 days
or less, purchase only instruments having remaining maturities of two
years or less and invest only in securities determined by or under the
supervision of the Trust's Board of Trustees to present minimal credit
risks.
Pursuant to the rule, the Trust's Board of Trustees also has
established procedures designed to allow investors in the Fund to
stabilize, to the extent reasonably possible, the investors' price per
share as computed for the purpose of sales and redemptions at $1.00.
These procedures include review of the Fund's holdings by the Trust's
Board of Trustees, at such intervals as it deems appropriate, to
determine whether the value of the Fund's assets calculated by using
available market quotations or market equivalents deviates from such
valuation based on amortized cost.
The rule also provides that the extent of any deviation between the
value of the Fund's assets based on available market quotations or
market equivalents and such valuation based on amortized cost must be
examined by the Trust's Board of Trustees. In the event the Trust's
Board of Trustees determines that a deviation exists that may result
in material dilution or other unfair results to investors or existing
shareholders, pursuant to the rule, the Trust's Board of Trustees must
cause the Fund to take such corrective action as the Board of Trustees
regards as necessary and appropriate, including: selling portfolio
instruments prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; withholding dividends or paying
distributions from capital or capital gains; redeeming shares in kind;
or valuing the Fund's assets by using available market quotations.
PURCHASE AND REDEMPTION INFORMATION
The Trust may suspend the right of redemption or postpone the date
of payment for shares of the Fund during any period when: (a) trading
on the New York Stock Exchange ("NYSE") is restricted by applicable
rules and regulations of the SEC; (b) the NYSE is closed for other
than customary weekend and holiday closings; (c) the SEC has by order
permitted such suspension; or (d) an emergency exists as determined by
the SEC.
Under the terms of a Placement Agent Agreement, Edgewood acts as
placement agent on a "best efforts" basis with respect to the sale of
shares of the Fund. In addition to Edgewood's duties as placement
agent, Edgewood may, in its discretion, perform additional functions
in connection with transactions in the shares of the Fund.
<PAGE>
MANAGEMENT OF THE TRUST
The Trust's Board of Trustees is composed of persons experienced in
financial matters who meet throughout the year to oversee the
activities of the Fund. In addition, the Trustees review contractual
arrangements with companies that provide services to the Fund and
review the Fund's performance.
The Trustees and officers of the Trust, their birthdate and their
principal occupations during the past five years are set forth below.
Their titles may have varied during that period. Unless otherwise
indicated, the address of each officer is Clearing Operations, P.O.
Box 897, Pittsburgh, PA 15230-0897.
TRUSTEES OF THE TRUST
CHARLES P. BIGGAR (birthdate: October 13, 1930) -- Trustee; Retired;
Director of Chase/NBW Bank Advisory Board; Director, Batemen, Eichler,
Hill Richards Inc.; formerly Vice President of International Business
Machines and President of the National Services and the Field
Engineering Divisions of IBM. His address is 12 Hitching Post Lane,
Chappaqua, New York 10514.
RICHARD J. HERRING (birthdate: February 18, 1946) -- Trustee; Vice Dean and
Director, Wharton Undergraduate Division, Professor, Finance Department,
The Wharton School, University of Pennsylvania. His address is 3255 Roberts
Road, Bryn Mawr, Pennsylvania 19010.
BRUCE E. LANGTON (birthdate: May 10, 1931) -- Trustee; Retired; Director,
Adela Investment Co. and University Patents, Inc.; formerly Assistant Treasurer
of IBM Corporation (until 1986). His address is 99 Jordan Lane,
Stamford, Connecticut 06903.
OFFICERS OF THE TRUST
RONALD M. PETNUCH (birthdate: February 27, 1960) ---- President and
Treasurer; Senior Vice President, Federated Services Company ("FSC");
formerly, Director of Proprietary Client Services, Federated
Administrative Services ("FAS"), and Associate Corporate Counsel,
Federated Investors ("FI").
CHARLES L. DAVIS, JR. (birthdate: March 23, 1960) ---- Vice President
and Assistant Treasurer; Vice President, FAS.
JAY S. NEUMAN (birthdate: April 22, 1950) ---- Secretary; Corporate
Counsel, FI.
Messrs. Davis, Neuman, and Petnuch also hold similar positions for other
investment companies for which Edgewood, or an affiliate, serves as the
principal underwriter.
No person who is an officer or director of Bankers Trust is an officer or
Trustee of the Trust. No director, officer or employee of Edgewood or any of
its affiliates will receive any compensation from the Trust for serving as
an officer or Trustee of the Trust.
<PAGE>
TRUSTEE COMPENSATION TABLE
AGGREGATE TOTAL COMPENSATION
NAME OF PERSON, COMPENSATION FROM FUND COMPLEX**
POSITION FROM TRUST* PAID TO TRUSTEES+
Richard J. Herring, $14,701 $29,980
Trustee
Bruce E. Langton, $14,628 $29,940
Trustee
Philip W. Coolidge++, $764 $2,500
Trustee of Trust
Charles P. Biggar, $13,965 $24,620
Trustee of Trust
* Information is furnished for the fiscal year ended June 30, 1997.
** Aggregated information is furnished for the BT Family of
Funds which consists of the following: BT Investment Funds,
BT Institutional Funds, BT Pyramid Mutual Funds, BT Advisor
Funds, BT Investment Portfolios, Cash Management Portfolio,
Treasury Money Portfolio, Tax Free Money Portfolio, NY Tax
Free Money Portfolio, International Equity Portfolio, Utility
Portfolio, Short Intermediate US Government Securities
Portfolio, Intermediate Tax Free Portfolio, Asset Management
Portfolio, Equity 500 Index Portfolio, and Capital
Appreciation Portfolio.
+ The information provided is for the last calendar year end.
++ Mr. Coolidge resigned as Trustee of the Trust effective August 11, 1997.
As of September 12, 1997, the Trustees and officers of the Trust and
the Funds owned in the aggregate less than 1% of the shares of any
Fund or the Trust (all series taken together).
As of September 12, 1997, the following shareholder owned 5% or more
of the outstanding shares of the Fund: BT Funds Securities Lending
Group, New York, New York, acting in various capacities for numerous
accounts, was the owner of record of approximately 2,867,876,954
shares (100%).
INVESTMENT ADVISER
Under the terms of an Advisory Agreement between the Fund and Bankers
Trust, Bankers Trust manages the Fund subject to the supervision and
direction of the Board of Trustees of the Fund. Bankers Trust will:
(i) act in strict conformity with the Fund's Declaration of Trust, the
1940 Act and the Investment Advisers Act of 1940, as the same may from
time to time be amended; (ii) manage the Fund in accordance with the
Fund's investment objectives, restrictions and policies, as stated
herein and in the Confidential Private Offering Memorandum; (iii) make
investment decisions for the Fund; and (iv) place purchase and sale
orders for securities and other financial instruments on behalf of the
Fund.
Bankers Trust bears all expenses in connection with the performance of
services under the Advisory Agreement. The Fund bears certain other
expenses incurred in its operation, including: taxes, interest,
brokerage fees and commissions, if any; fees of Trustees of the Trust
who are not officers, directors or employees of Bankers Trust,
Edgewood or any of their affiliates; SEC fees and state Blue Sky
filing fees, if any; administrative and services fees; certain
insurance premiums; outside auditing and legal expenses; costs of
maintenance of corporate existence; costs attributable to investor
services, including, without limitation, telephone and personnel
expenses; and printing confidential private offering memorandums and
confidential statements of additional information for regulatory
purposes and for distribution to existing shareholders; costs of
shareholders' reports and meetings of shareholders, officers and
Trustees of the Trust; and any extraordinary expenses.
Bankers Trust may have deposit, loan and other commercial banking
relationships with the issuers of obligations which may be purchased
on behalf of the Fund, including outstanding loans to such issuers
which could be repaid in whole or in part with the proceeds of
securities so purchased. Such affiliates deal, trade and invest for
their own accounts in such obligations and are among the leading
dealers of various types of such obligations. Bankers Trust has
informed the Trust that, in making its investment decisions, it does
not obtain or use material inside information in its possession or in
the possession of any of its affiliates. In making investment
recommendations for the Fund, Bankers Trust will not inquire or take
into consideration whether an issuer of securities proposed for
purchase or sale by the Fund is a customer of Bankers Trust, its
parent or its subsidiaries or affiliates and, in dealing with its
customers, Bankers Trust, its parent, subsidiaries, and affiliates
will not inquire or take into consideration whether securities of such
customers are held by any fund managed by Bankers Trust or any such
affiliate.
For the period from November 13, 1996, (commencement of operations) to
June 30, 1997, Bankers Trust earned $1,293,002 in compensation for
investment advisory services. During the same period Bankers Trust
reimbursed $79,812 to cover Fund expenses.
ADMINISTRATOR
Under the administration and services agreements, Bankers Trust is
obligated on a continuous basis to provide such administrative
services as the Board of Trustees of the Trust reasonably deems
necessary for the proper administration of the Trust. Bankers Trust
will generally assist in all aspects of the Fund's operations; supply
and maintain office facilities (which may be in Bankers Trust's own
offices), statistical and research data, data processing services,
clerical, accounting, bookkeeping and recordkeeping services
(including without limitation the maintenance of such books and
records as are required under the 1940 Act and the rules thereunder,
except as maintained by other agents of the Trust), internal auditing,
executive and administrative services, and stationery and office
supplies; prepare reports to shareholders or investors; prepare and
file tax returns; supply financial information and supporting data for
reports to and filings with the SEC and various state Blue Sky
authorities, if applicable; supply supporting documentation for
meetings of the Board of Trustees; provide monitoring reports and
assistance regarding compliance with the Trust's Declaration of Trust,
by-laws, investment objectives and policies and with applicable
Federal and state securities laws; arrange for appropriate insurance
coverage; calculate the NAV, net income and realized capital gains or
losses of the Trust; and negotiate arrangements with, and supervise
and coordinate the activities of, agents and others retained to supply
services.
Pursuant to a sub-administration agreement (the "Sub-Administration
Agreement") FSC performs such sub-administration duties for the Trust
as from time to time may be agreed upon by Bankers Trust and FSC. The
Sub-Administration Agreement provides that FSC will receive such
compensation as from time to time may be agreed upon by FSC and
Bankers Trust. All such compensation will be paid by Bankers Trust.
For the period from November 13, 1996 (commencement of operations) to
June 30, 1997, Bankers Trust earned $258,600 in compensation for
administrative and other services provided to the Fund.
CUSTODIAN AND TRANSFER AGENT
Bankers Trust, 130 Liberty Street, New York, New York 10006, serves as
custodian and transfer agent for the Trust and as custodian for the
Fund pursuant to the administration and services agreements discussed
above. As custodian, Bankers Trust holds the Fund's assets. For such
services, Bankers Trust receives monthly fees from the Fund, which are
included in the administrative services fees discussed above. As
transfer agent for the Trust, Bankers Trust maintains the shareholder
account records for the Fund, handles certain communications between
shareholders and the Trust and causes to be distributed any dividends
and distributions payable by the Trust. Bankers Trust is also
reimbursed by the Fund for its out-of-pocket expenses. Bankers Trust
will comply with the self-custodian provisions of Rule 17f-2 under the
1940 Act.
USE OF NAME
The Trust and Bankers Trust have agreed that the Trust may use "BT" as
part of its name for so long as Bankers Trust serves as investment
adviser. The Trust has acknowledged that the term "BT" is used by and
is a property right of certain subsidiaries of Bankers Trust and that
those subsidiaries and/or Bankers Trust may at any time permit others
to use that term.
The Trust may be required, on 60 days' notice from Bankers Trust
at any time, to abandon use of the acronym "BT" as part of its name.
If this were to occur, the Trustees would select an appropriate new
name for the Trust, but there would be no other material effect on the
Trust, its shareholders or activities.
BANKING REGULATORY MATTERS
Bankers Trust has been advised by its counsel that in its opinion
Bankers Trust may perform the services for the Fund contemplated by
the Advisory Agreement and other activities for the Trust described in
the Confidential Private Offering Memorandum and this Confidential
Statement of Additional Information without violation of the
Glass-Steagall Act or other applicable banking laws or regulations.
However, counsel has pointed out that future changes in either Federal
or state statutes and regulations concerning the permissible
activities of banks or trust companies, as well as future judicial or
administrative decisions or interpretations of present and future
statutes and regulations, might prevent Bankers Trust from continuing
to perform those services for the Trust. If the circumstances
described above should change, the Board of Trustees would review the
Trust's relationship with Bankers Trust and consider taking all
actions necessary in the circumstances. In addition, state securities
law on this issue may differ from interpretations of Federal law as
expressed herein and banks and financial institutions may be required
to register as dealers pursuant to state law.
COUNSEL AND INDEPENDENT ACCOUNTANTS
Willkie Farr & Gallagher, One Citicorp Center, 153 East 53rd Street,
New York, New York 10022-4669, serves as Counsel to the Trust and from
time to time provides certain legal services to Bankers Trust. Coopers
& Lybrand LLP, 1100 Main Street, Suite 900, Kansas City, Missouri
64105 has been selected as Independent Accountants for the Trust.
ORGANIZATION OF THE TRUST
The Trust was organized on March 26, 1990, as a an unincorporated
business association under the laws of the Commonwealth of
Massachusetts ("Massachusetts Business Trust"). The shares of each
series participate equally in the earnings, dividends and assets of
the particular series. The Trust may create and issue additional
series of shares, and may divide the shares of any series into one or
more classes, in the future. The Declaration of Trust of the Trust
permits the Trustees to divide or combine the shares into a greater or
lesser number of shares without thereby changing the proportionate
beneficial interest in a series. Each share represents an equal
proportionate interest in a series with each other share. Shares when
issued are fully paid and non-assessable, except as set forth below.
Shareholders are entitled to one vote for each share held.
Shares of the Trust do not have cumulative voting rights, which means that
holders of more than 50% of the shares voting for the election of Trustees can
elect all Trustees. Shares of the Fund are not transferable nor do
shares have preemptive, conversion or subscription rights.
The Trust is not required to hold annual meetings of shareholders, but
will hold special meetings of shareholders when in the judgment of the
Trustees it is necessary or desirable to submit matters for a
shareholder vote. Shareholders have under certain circumstances the
right to communicate with other shareholders in connection with
requesting a meeting of shareholders for the purpose of removing one
or more Trustees without a meeting. Upon liquidation of the Fund,
shareholders of the Fund would be entitled to share pro rata in the
net assets of the Fund available for distribution to shareholders.
Massachusetts law provides that shareholders could under certain
circumstances be held personally liable for the obligations of the
Trust. However, the Declaration of Trust disclaims shareholder
liability for acts or obligations of the Trust and requires that
notice of this disclaimer be given in each agreement, obligation or
instrument entered into or executed by the Trust or a Trustee. The
Declaration of Trust provides for indemnification from the Trust's
property for all losses and expenses of any shareholder held
personally liable for the obligations of the Trust. Thus, the risk of
shareholders incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust itself would
be unable to meet its obligations, a possibility that the Trust
believes is remote. Upon payment of any liability incurred by the
Trust, the shareholder paying the liability will be entitled to
reimbursement from the general assets of the Trust. The Trustees
intend to conduct the operations of the Trust in a manner so as to
avoid, as far as possible, ultimate liability of the shareholders for
liabilities of the Trust.
TAXES
The following is only a summary of certain tax considerations generally
affecting the Fund and its shareholders, and is not intended as a substitute
for careful tax planning. Shareholders are urged to consult tax advisers with
specific reference to their tax situations.
As described herein and in the Fund's Confidential Private Offering
Memorandum, the Fund is designed to provide investors with liquidity
and current income. The Fund is not intended to constitute a balanced
investment program and is not designed for investors seeking capital
gains, maximum income or maximum tax-exempt income irrespective of
fluctuations in principal.
The Trust intends that the Fund qualify as a separate regulated
investment company under the Internal Revenue Code of 1986, as amended
(the "Code"). Provided that the Fund is a regulated investment
company, the Fund will not be liable for Federal income taxes to the
extent all of its taxable net investment income and net realized long
and short-term capital gains, if any, are distributed to its
shareholders. Although the Trust expects the Fund to be relieved of
all or substantially all Federal income taxes, depending upon the
extent of its activities in states and localities in which its offices
are maintained, in which its agents or independent contractors are
located or in which they are otherwise are deemed to be conducting
business, that portion of the Fund's income which is treated as earned
in any such state or locality could be subject to state and local tax.
Any such taxes paid by the Fund would reduce the amount of income and
gains available for distribution to its shareholders.
While the Fund does not expect to realize net long-term capital gains,
any such gains realized will be distributed annually as described in
the Fund's Confidential Private Offering Memorandum. Such
distributions ("capital gain dividends"), if any, will be taxable to
non tax-exempt shareholders as long-term capital gains, regardless of
how long a shareholder has held Fund shares.
PERFORMANCE INFORMATION
The "effective yield" of the Fund is an annualized "yield" based on a
compounding of the unannualized base period return. These yields are
each computed in accordance with a standard method prescribed by the
rules of the SEC, by first determining the "net change in account
value" for a hypothetical account having a share balance of one share
at the beginning of a seven-day period (the "beginning account
value"). The net change in account value equals the value of
additional shares purchased with dividends from the original share and
dividends declared on both the original share and any such additional
shares. The unannualized "base period return" equals the net change in
account value divided by the beginning account value. Realized gains
or losses or changes in unrealized appreciation or depreciation are
not taken into account in determining the net change in account value.
The yields are then calculated as follows:
Base Period Return = NET CHANGE IN ACCOUNT VALUE
Beginning Account Value
Current Yield = Base Period Return x 365/7
Effective Yield = [(1 + Base Period Return)365/7] - 1
FINANCIAL STATEMENTS
The financial statements for the Fund for the fiscal period ended June
30, 1997, are incorporated herein by reference to the Annual Report to
Shareholders of the Fund dated June 30, 1997, (File No. 811-6071). A
copy of the Fund's Annual Report may be obtained without charge by
contacting the Fund.
<PAGE>
APPENDIX
DESCRIPTION OF SECURITIES RATINGS
DESCRIPTION OF S&P COMMERCIAL PAPER RATINGS:
Commercial paper rated A-1 by S&P indicates that the degree of safety
regarding timely payment is either overwhelming or very strong. Those issues
determined to possess overwhelming safety characteristics are denoted A-1+.
DESCRIPTION OF MOODY'S COMMERCIAL PAPER RATINGS:
The rating Prime-1 is the highest commercial paper rating assigned by
Moody's. Issuers rated Prime-1 (or related supporting institutions)
are considered to have a superior capacity for repayment of short-term
promissory obligations.
DESCRIPTION OF FITCH INVESTORS SERVICE'S COMMERCIAL PAPER RATINGS:
F-1+----Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1----Very Strong Credit Quality. Issues assigned this rating reflect
an assurance of timely payment only slightly less in degree than the
strongest issue.
DESCRIPTION OF DUFF & PHELPS' COMMERCIAL PAPER RATINGS:
Duff 1+----Highest certainty of timely payment. Short-term liquidity,
including internal operating factors and/or access to alternative sources of
funds, is outstanding, and safety is just below risk free U.S. Treasury
short-term obligations.
Duff 1----Very high certainty of timely payment. Liquidity factors are
excellent and supported by good fundamental protection factors. Risk
factors are minor.
DESCRIPTION OF IBCA'S SHORT-TERM RATINGS:
A1+----Obligations supported by the highest capacity for timely
repayment.
A1----Obligations supported by a strong capacity for timely repayment.
DESCRIPTION OF THOMSON BANK WATCH SHORT-TERM RATINGS:
TBW-1----The highest category; indicates a very high likelihood that
principal and interest will be paid on a timely basis.
<PAGE>
Investment Adviser and Administrator
BANKERS TRUST COMPANY
Placement Agent
EDGEWOOD SERVICES, INC.
Custodian and Transfer Agent
BANKERS TRUST COMPANY
Independent
Accountants
COOPERS
&
LYBRAND
L.L.P.
Counsel
WILLKIE FARR & GALLAGHER
No person has been authorized to give any information or to make any
representations other than those contained in the Fund's Confidential
Private Offering Memorandum or its Confidential Statement of
Additional Information in connection with the offering of the Fund's
shares and, if given or made, such other information or
representations must not be relied on as having been authorized by the
Trust. This Confidential Statement of Additional Information does not
constitute an offer in any state in which, or to any person to whom,
such offer may not lawfully be made.
PART C OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Incorporated by reference to the Annual Report of BT
Institutional Funds dated June 30, 1997, pursuant to Rule 411
under the Securities Act of 1933. (File Nos. 33-34079 and
811-6071.
(b) EXHIBITS:
--------
(1) (i) Conformed copy of Amended and Restated Declaration of Trust
of the Trust; 5.
(ii) Fifth Amended and Restated Establishment and Designation of
Series of the Trust; 5.
(iii) Sixth Amended and Restated Establishment and Designation of
Series of the Trust; 5.
(iv) Seventh Amended and Restated Establishment and Designation
of Series of the Trust; 5.
(v) Eighth Amended and Restated Establishment and Designation of
Series of the Trust; 5.
(vi) Ninth Amended and Restated Establishment and Designation of
Series of the Trust; 5.
(vii) Tenth Amended and Restated Establishment and Designation of
Series of the Trust; 5.
(viii) Eleventh Amended and Restated Establishment and Designation
of Series of the Trust; 7.
(2) Copy of By-Laws of the Trust; 5.
(3) Not Applicable.
(4) Copy of Specimen stock certificates for shares of beneficial interest
of the Trust; 1.
(5) Conformed copy of Investment Advisory Agreement; 7.
(6) Conformed copy of Distributor's Contract; 9.
(i) Conformed copy of Exclusive Placement Agent Agreement -
Institutional Daily Assets Fund; 9.
(7) Not applicable.
(8) (i) Conformed Copy of Custodian Agreement of Registrant; 10.
(ii) Amendment #1 to Exhibit A of Custodian Agreement; 10.
(9) (i) Administration and Services Agreement; 5.
(ii) Schedule of Fees under Administration and Service
Agreement; 7.
(iii) Exhibit D to the Administration and Services Agreement; 10.
(10) Not Applicable.
(11) Conformed Copy of Consent of Independent Accountants; +.
(12) Not Applicable.
- --------------------
+ All exhibits have been filed electronically.
1. Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registrant's registration statement on Form N-1A ("Registration
Statement") as filed with the Securities and Exchange Commission
("Commission") on July 20, 1990.
5. Incorporated by reference to Post-Effective Amendment No. 15 to
the Registration Statement as filed with the Commission on
July 5, 1995.
7. Incorporated by reference to Amendment No. 21 to the Registration
Statement as filed with the Commission on September 24, 1996.
9. Incorporated by reference to Post-Effective Amendment No. 19 to
the Registration Statement as filed with the Commission on
March 17, 1997.
10. Incorporated by reference to Post-Effective Amendment No. 20 to
the Registration Statement as filed with the Commission on
September 10, 1997.
<PAGE>
(13) (i) Conformed copy of investment representation letter of
initial shareholder of the Equity 500 Index Fund; 3.
(ii) Conformed copy of investment representation letter of
initial shareholder of the Institutional Liquid Assets
Fund; 5.
(iii) Conformed copy of investment representation letter of
initial shareholder of the Institutional Daily Assets
Fund; 7.
(14) Not Applicable.
(15) (i) Conformed copy of Plan of Distribution; 9.
(ii) Copy of Schedule A under the Plan of Distribution; 10.
(16) (i) Copy of method of computation of performance information
for money market funds; 2.
(ii) Copy of method of computation of performance information
for non-money market funds; 3.
(17) Financial Data Schedule for BT Institutional Daily Assets Fund; +.
(18) Copy of Multiple Class Expense Allocation Plan Adopted Pursuant
to Rule 18f-3.; 10.
(19) Conformed copy of Power of Attorney of Registrant; 10.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT:
None
Item 26. NUMBER OF HOLDERS OF SECURITIES:
Title of Class Number of Record Holders
AS OF SEPTEMBER 8, 1997
Institutional Cash Management Fund: 728
Institutional Treasury Money Fund: 614
Institutional Tax Free Money Fund: 0
Institutional NY Tax Free Money Fund: 0
Institutional Equity 500 Index Fund: 195
BT Institutional Capital Appreciation Fund: 0
Institutional Liquid Assets Fund: 3
Institutional Cash Reserves: 268
Institutional Daily Assets Fund: 1
International Equity Fund
Class I 4
Class II 1
Global Emerging Markets Equity Fund 0
International Small Company Equity Fund 0
Item 27. INDEMNIFICATION; 8
- --------------------
+ All exhibits have been filed electronically.
2. Incorporated by reference to Post-Effective Amendment No. 1 to the
Registration Statement as filed with the Commission on
February 29, 1991.
3. Incorporated by reference to Post-Effective Amendment No. 4 to the
Registration Statement as filed with the Commission on
April 30, 1992.
7. Incorporated by reference to Amendment No. 21 to the Registration
Statement as filed with the Commission on September 24, 1996.
8. Incorporated by reference to Post-Effective Amendment No. 17 to
the Registration Statement as filed with the Commission on
April 30, 1996.
9. Incorporated by reference to Post-Effective Amendment No. 19 to
the Registration Statement as filed with the Commission on
March 17, 1997
10. Incorporated by reference to Post-Effective Amendment No. 20 to
the Registration Statement as filed with the Commission on
September 10, 1997.
<PAGE>
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER:
Bankers Trust serves as investment adviser to the Fund's Portfolio.
Bankers Trust, a New York banking corporation, is a wholly owned
subsidiary of Bankers Trust New York Corporation. Bankers Trust
conducts a variety of commercial banking and trust activities and is a
major wholesale supplier of financial services to the international
institutional market. To the knowledge of the Trust, none of the
directors or officers of Bankers Trust, except those set forth below,
is or has been at anytime during the past two fiscal years engaged in
any other business, profession, vocation or employment of a
substantial nature, except that certain directors and officers also
hold various positions with and engage in business for Bankers Trust
New York Corporation. Set forth below are the names and principal
businesses of the directors and officers of Bankers Trust who are or
during the past two fiscal years have been engaged in any other
business, profession, vocation or employment of a substantial nature.
These persons may be contacted c/o Bankers Trust Company, 130 Liberty
Street, New York, New York 10006.
George B. Beitzel, International Business Machines Corporation, Old
Orchard Road, Armonk, NY 10504. Director, Bankers Trust Company;
Retired senior vice president and Director, International Business
machines Corporation; Director, Computer Task Group; Director,
Phillips Petroleum Company; Director, Caliber Systems, Inc. (formerly,
Roadway Services Inc.); Director, Rohm and Haas Company; Director, TIG
Holdings; Chairman emeritus of Amherst College; and Chairman of the
Colonial Willimsburg Foundation.
Richard H. Daniel, Bankers Trust Company, 130 Liberty Street, New
York, New York 10006. Vice chairman and chief financial officer,
Bankers Trust Company and Bankers Trust New York Corporation;
Beneficial owner, general partner, Daniel Brothers, Daniel Lingo &
Assoc., Daniel Pelt & Assoc.; Beneficial owner, Rhea C. Daniel Trust.
Philip A. Griffiths, Bankers Trust Company, 130 Liberty Street, New
York, New York 10006. Director, Institute for Advanced Study;
Director, Bankers Trust Company; Chairman, Committee on Science,
Engineering and Public Policy of the National Academies of Sciences
and Engineering & the Institute of Medicine; and Chairman and member,
Nominations Committee and Committee on Science and Engineering
Indicators, National Science Board; Trustee, North Carolina School of
Science and Mathematics and the Woodward Academy.
William R. Howell, J.C. Penney Company, Inc., P.O. Box 10001,
Plano, TX 75301-0001. Chairman Emeritus, J.C. Penney Company, Inc.;
Director, Bankers Trust Company; Director, Exxon Corporation;
Director, Halliburton Company; Director, Warner-Lambert Corporation;
Director, The Williams Companies, Inc.; and Director, National Retail
Federation.
Vernon E. Jordan, Jr., Akin, Gump, Strauss, Hauer & Feld, LLP, 1333
New Hampshire Ave., N.W., Washington, DC 20036. Senior Partner, Akin,
Gump, Strauss, Hauer & Feld, LLP; Director, Bankers Trust Company;
Director, American Express Company; Director, Dow-Jones, Inc.;
Director, J.C. Penney Company, Inc.; Director, Revlon Group
Incorporated; Director, Ryder System, Inc.; Director, Sara Lee
Corporation; Director, Union Carbide Corporation; Director, Xerox
Corporation; Trustee, Brookings Institution; Trustee, The Ford
Foundation; and Trustee, Howard University.
David Marshall, 130 Liberty Street, New York, New York 10006. Chief
Information Officer and Executive Vice President, Bankers Trust New
York Corporation; Senior Managing Director, Bankers Trust Company.
Hamish Maxwell, Philip Morris Companies Inc., 120 Park Avenue, New
York, NY 10006. Retired Chairman and Chief Executive Officer, Philip
Morris Companies Inc.; Director, Bankers Trust Company; Director, The
News Corporation Limited; Director, Sola International Inc.; and
Chairman, WWP Group pic.
Frank N. Newman, Bankers Trust Company, 130 Liberty Street, New York,
New York 10006. Chairman of the Board, Chief Executive Officer and
President, Bankers Trust New York Corporation and Bankers Trust
Company; Director, Bankers Trust Company; Director, Dow-Jones, Inc.;
and Director, Carnegie Hall.
N.J. Nicholas Jr., 745 Fifth Avenue, New York, NY 10020. Director, Bankers
Trust Company; Director, Boston Scientific Corporation; and Director, Xerox
Corporation.
Russell E. Palmer, The Palmer Group, 3600 Market Street, Suite 530,
Philadelphia, PA 19104. Chairman and Chief Executive Officer of The
Palmer Group; Director, Bankers Trust Company; Director, Allied-Signal
Inc.; Director, Federal Home Loan Mortgage Corporation; Director, GTE
Corporation; Director, The May Department Stores Company; Director,
Safeguard Scientifics, Inc.; and Trustee, University of Pennsylvania.
Donald L. Staheli, Bankers Trust Company, 130 Liberty Street, New
York, New York 10006. Chairman of the Board and Chief Executive
Officer, Continental Grain Company; Director, Bankers Trust Company;
Director, ContiFinancial Corporation; Director, Prudential Life
Insurance Company of America; Director, Fresenius Medical Care, A.g.;
Director, America-China Society; Director, National Committee on
United States-China Relations; Director, New York City Partnership;
Chairman, U.S.-China Business Council; Chairman, Council on Foreign
Relations; Chairman, National Advisor Council of Brigham Young
University's Marriott School of Management; Vice Chairman, The Points
of Light Foundation; and Trustee, American Graduate School of
International Management.
Patricia Carry Stewart, c/o Office of the Secretary, 130 Liberty
Street, New York, NY 10006. Director, Bankers Trust Company; Director,
CVS Corporation; Director, Community Foundation for Palm Beach and
Martin Counties; Trustee Emerita, Cornell University.
George J. Vojta, Bankers Trust Company, 130 Liberty Street, New York,
NY 10006. Vice Chairman, Bankers Trust New York Corporation and
Bankers Trust Company; Director, bankers Trust Company; Director;
Alicorp S.A.; Director; Northwest Airlines; Director, Private Export
Funding Corp.; Director, New York State Banking Board; Director, St.
Lukes-Roosevelt Hospital Center; Partner, New York City Partnership;
and Chairman, Wharton Financial Services Center.
Paul A. Volcker, Bankers Trust Company, 130 Liberty Street, New York,
New York 10006. Director, Bankers Trust Company; Director, American
Stock Exchange; Director, Nestle S.A.; Director, Prudential Insurance
Company; Director, UAL Corporation; Chairman, Group of 30; North
American Chairman, Trilateral Commission; Co-Chairman, Bretton Woods
Committee; Co-Chairman, U.S./Hong Kong Economic Cooperation Committee;
Director, American Council on Germany; Director, Aspen Institute;
Director, Council on Foreign Relations; Director, The Japan Society;
and Trustee, The American Assembly.
Melvin A. Yellin, Bankers Trust Company, 130 Liberty Street, New York,
New York 10006. Senior Managing Director and General Counsel of
Bankers Trust New York Corporation and Bankers Trust Company;
Director, 1136 Tenants Corporation; and Director, ABA Securities
Association.
<PAGE>
Item 29. PRINCIPAL UNDERWRITERS:
a) Edgewood Services, Inc. the Distributor for shares of the
Registrant, acts as principal underwriter for the following
open-end investment companies, including the Registrant: BT
Advisor Funds, BT Institutional Funds, BT Investment Funds, BT
Pyramid Mutual Funds, Excelsior Funds, Excelsior Funds, Inc.,
(formerly, UST Master Funds, Inc.), Excelsior Institutional
Trust, Excelsior Tax-Exempt Funds, Inc. (formerly, UST Master
Tax-Exempt Funds, Inc.), FTI Funds, FundManager Portfolios, Great
Plains Funds, Marketvest Funds, Marketvest Funds, Inc., Old
Westbury Funds, Inc. and WesMark Funds.
(b)
<TABLE>
<CAPTION>
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
BUSINESS ADDRESS WITH DISTRIBUTOR WITH REGISTRANT
<S> <C> <C>
Lawrence Caracciolo Director, President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Arthur L. Cherry Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
J. Christopher Donahue Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ronald M. Petnuch Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Schmitt Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Sholes Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
S. Elliott Cohan Secretary, Assistant Secretary
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas J. Ward Assistant Secretary, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Kenneth W. Pegher, Jr. Treasurer, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
(c) Not Applicable.
</TABLE>
<PAGE>
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS:
BT INSTITUTIONAL FUNDS: Federated Investor Tower
("Registrant") Pittsburgh, PA 15222-3779
BANKERS TRUST COMPANY: 130 Liberty Street
("Adviser, Custodian and New York, NY 10006
Administrator")
INVESTORS FIDUCIARY TRUST COMPANY: 127 West 10th Street
("Transfer Agent and Dividend Kansas City, MO 64105
Disbursing Agent")
EDGEWOOD SERVICES, INC.: Clearing Operations
("Distributor") P.O. Box 897
Pittsburgh, PA 15230-0897
Item 31. MANAGEMENT SERVICES:
Not applicable.
Item 32. UNDERTAKINGS:
Registrant hereby undertakes to file a post-effective amendment,
using financial statements on behalf of International Equity Fund
which need not be certified, within four to six months from the
effective date of Post-Effective Amendment No. 18.
Registrant hereby undertakes to file a post-effective
amendment, using financial statements on behalf of
International Small Company Equity Fund which need not be
certified, within four to six months from the
effective date of Post-Effective Amendment No. 20.
Registrant hereby undertakes to comply with the
provisions of Section 16(c) of the 1940 Act with respect to the
removal of Trustees and the calling of special shareholder meetings by
shareholders.
Registrant hereby undertakes to furnish each person to
whom a prospectus is delivered with a copy of the Registrant's latest
annual report to shareholders, upon request and without charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Investment Company Act of
1940, the Registrant, BT INSTITUTIONAL FUNDS, has duly caused this
Amendment to its Registration Statement to be signed on its behalf by
the undersigned, thereto duly authorized, in the City of Pittsburgh
and the Commonwealth of Pennsylvania on the 7th of October, 1997.
BT INSTITUTIONAL FUNDS
By: /s/ Jay S. Neuman
Jay S. Neuman, Secretary
October 7, 1997
Exhibit (11) under N-1A
Exhibit 23 under 601/Reg SK
COOPERS & LYBRAND
Consent of Independent Accountants
We consent to the inclusion in this Amendment No. 26 to the
Registration Statement of BT Institutional Daily Assets Fund on Form
N-1A of our report dated July 29, 1997, on our audit of the financial
statements and financial highlights of BT Institutional daily Assets
Fund which report is included in its Annual Report to Shareholders
which is also incorporated by reference in this Amendment to the
Registration Statement. We also consent to the references to our Firm
in the Prospectus under the caption "Financial Highlights" and in the
Statement of Additional Information under the caption "Counsel and
Independent Accountants."
/s/Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Kansas City, Missouri
October 3, 1997
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains Summary Financial Information extracted from
the BT Institutional Daily Assets Fund Annual Report dated June 30,
1997, and is qualified in its entirety by reference to such Annual
Report.
</LEGEND>
<CIK> 0000862157
<NAME> INSTITUTIONAL DAILY ASSETS FUND
<S> <C>
<PERIOD-TYPE> 8-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> NOV-13-1996
<PERIOD-END> JUN-30-1997
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<DISTRIBUTIONS-OF-INCOME> 70235163
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</TABLE>
