As filed with the Securities and Exchange Commission on February 28, 1996
Registration No. 33-48605 and 811-06139
(The 59 Wall Street U.S. Equity Fund)
(The 59 Wall Street Short/Intermediate Fixed Income Fund)
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 5
and/or
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 24
THE 59 WALL STREET FUND, INC.
(Exact name of Registrant as specified in charter)
6 St. James Avenue, Boston, Massachusetts 02116
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (617)423-0800
PHILIP W. COOLIDGE Copy to: JOHN E. BAUMGARDNER, JR., ESQ.
6 St. James Avenue Sullivan & Cromwell
Boston, Massachusetts 02116 125 Broad Street
Name and Address of Agent for Service) New York, New York 10004
It is proposed that this filing will become effective (check
appropriate box)
[X] immediately upon filing pursuant to pursuant to paragraph (b)
[ ] on (date) pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a) (i)
[ ] on (date) pursuant to paragraph (a)(i)
[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on (date) pursuant to paragraph (a)(ii) of rule 485.
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has registered an indefinite number of its shares of common stock
pursuant to Rule 24f-2 under the Investment Company Act of 1940. Registrant
filed the Notice required by Rule 24f-2 on December 29, 1995, for Registrant's
fiscal year ending October 31, 1995.
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<PAGE>
EXPLANATORY NOTE
This Amendment (the "Amendment") to the Registrant's Registration
Statement relates to the Prospectus of The 59 Wall Street U.S. Equity Fund and
The 59 Wall Street Short/Intermediate Fixed Income Fund (each a "Fund",
collectively the "Funds"), each a series of shares of the Registrant. The other
series of shares of the Registrant, The 59 Wall Small Company Fund, is offered
by the Prospectus that was included in Part A of Amendment 22 to the
Registrant's Registration Statement ("Amendment No. 22") . Two other series of
shares of the Registrant (The 59 Wall Street European Equity Fund and The 59
Wall Street Pacific Basin Equity Fund) are offered by the Prospectus that is
included in Part A of Amendment No. 23 to the Registrant's Registration
Statement ("Amendment No. 23"). The remaining series of shares of the Registrant
(The 59 Wall Street International Equity Fund") was offered by the Prospectus
that was included in Part A of Amendment No. 15 to the Registrant's Registration
Statement ("Amendment No. 15").
This Amendment does not relate to, amend or otherwise affect the
Prospectus of The 59 Wall Small Company Fund, which is incorporated herein by
reference from Amendment No. 22, the Prospectus of The 59 Wall Street European
Equity Fund and The Wall Street Pacific Basin Equity Fund, which is incorporated
herein by reference from Amendment No. 23, and the Prospectus of The 59 Wall
Street International Equity Fund, which is incorporated herein by reference from
Amendment No. 15.
WS5231B
<PAGE>
CROSS REFERENCE SHEET
(as required by Rule 404(c))
N-1A Item No. Location
Part A
Item 1. Cover Page . . . . . . . . . . . . . . . . Cover Page
Item 2. Synopsis . . . . . . . . . . . . . . . . . Expense Table
Item 3. Condensed Financial Information. . . . . . Financial Highlights
Item 4. General Description of Registrant. . . . . Investment Objective
and Restrictions;
Description o Shares
Item 5. Management of the Fund . . . . . . . . . . Management of the
Corporation; Expense
Table
Item 5A. Management's Description of Fund
Performance . . . . . . . . . . . . . . Not Applicable
Item 6. Capital Stock and Other Securities . . . . Description of
Item 7. Purchase of Securities Being Offered . . . Management of the
Corporation;
Item 8. Redemption or Repurchase . . . . . . . . . Redemption of Shares
Item 9. Pending Legal Proceedings. ... . . . . . . Not Applicable
Part B
Item 10. Cover Page . . . . . . . . . . . . . . . . Cover Page
Item 11. Table of Contents. . . . . . . . . . . . . Table of Contents
Item 12. General Information and History. . . . . . Not Applicable
Item 13. Investment Objectives and Policies . . . . Investment Objective and
Policies; Investment
Restrictions
Item 14. Management of the Fund . . . . . . . . . . Directors and Officers
Item 15. Control Persons and Principal Holders
of Securities . . . . . . . . . . . . . Directors and Officers
Item 16. Investment Advisory and Other Services . . Administrator;
Distributor;
Investment Adviser;
Item 17. Brokerage Allocation and Other Practices . Portfolio Transactions
Item 18. Capital Stock and Other Securities . . . . Description of Shares
(in both the Prospectus
and the Statement of
Additional Information
Item 19. Purchase, Redemption and Pricing of
Securities Being Offered. . . . . . . . Purchase of Shares; Net
Asset Value;
Redemption in Kind
Item 20. Tax Status . . . . . . . . . . . . . . . . Federal Taxes
Item 21. Underwriters . . . . . . . . . . . . . . . Administrator;
Distributor; Purchase
of Shares
Item 22. Calculation of Performance Data . . . . . Computation of
Performance
Item 23. Financial Statements . . . . . . . . . . . Financial Statements
Part C
Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C of this Registration Statement.
<PAGE>
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PROSPECTUS
The 59 Wall Street U.S. Equity Fund
The 59 Wall Street Short/Intermediate Fixed Income Fund
6 St. James Avenue, Boston, Massachusetts 02116
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The 59 Wall Street U.S. Equity Fund and The 59 Wall Street
Short/Intermediate Fixed Income Fund are separate portfolios of The 59 Wall
Street Fund, Inc. Shares of each Fund are offered by this Prospectus.
The U.S. Equity Fund's investment objective is to provide investors with
long-term capital growth while also generating current income. The assets of the
U.S. Equity Fund under normal circumstances are fully invested in equity
securities of companies that are well-established and financially sound. The
U.S. Equity Fund is an appropriate investment for those investors seeking
superior long-term returns combined with some current income and who are able to
accept the risks inherent in equity investing.
The Short/Intermediate Fixed Income Fund's investment objective is to
provide investors with a high level of current income consistent with minimizing
price fluctuations in net asset value and maintaining liquidity. The
Short/Intermediate Fixed Income Fund under normal circumstances is primarily
invested in high quality fixed-income securities and has an average weighted
maturity of two to four years. The Fund is an appropriate investment for those
investors seeking fixed income investment returns greater than those provided by
money market funds and who are able to accept fluctuations in the net asset
value of their investment. This Fund is designed to have lesser price
fluctuations than long term bond funds. There can be no assurance that either
Fund's investment objective will be achieved.
Investments in the Funds are neither insured nor guaranteed by the U.S.
Government. Shares of the Funds are not deposits or obligations of, or
guaranteed by, Brown Brothers Harriman & Co. or any other bank, and the shares
are not insured by the Federal Deposit Insurance Corporation, the Federal
Reserve Board or any other federal, state or other governmental agency.
Brown Brothers Harriman & Co. is the investment adviser to, the
administrator of and the shareholder servicing agent for each Fund. Shares of
the Funds are offered at net asset value and without a sales charge to customers
of Brown Brothers Harriman & Co. and to other investors of means.
This Prospectus, which investors are advised to read and retain for future
reference, sets forth concisely the information about each Fund that a
prospective investor ought to know before investing. Additional information
about each Fund has been filed with the Securities and Exchange Commission in a
Statement of Additional Information, dated February 28, 1996. This information
is incorporated herein by reference and is available without charge upon request
from the Funds' distributor, 59 Wall Street Distributors, Inc., 6 St. James
Avenue, Boston, Massachusetts 02116.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
===============================================================================
The date of this Prospectus is February 28, 1996.
<PAGE>
TABLE OF CONTENTS
Page
----
Expense Table............................................................ 3
Financial Highlights..................................................... 4
Investment Objective and Policies ....................................... 5
Investment Restrictions.................................................. 10
Purchase of Shares....................................................... 10
Redemption of Shares..................................................... 11
Management of the Corporation............................................ 12
Net Asset Value.......................................................... 16
Dividends and Distributions.............................................. 16
Taxes.................................................................... 17
Description of Shares.................................................... 18
Additional Information................................................... 19
Appendix A............................................................... 20
Appendix B............................................................... 24
TERMS USED IN THIS PROSPECTUS
Corporation ............................ The 59 Wall Street Fund, Inc.
Funds................................... The 59 Wall Street U.S. Equity Fund
(the "U.S. Equity Fund")
The 59 Wall Street Short/Intermediate
Fixed Income Fund (the
"Short/IntermediateFixed Income Fund")
Investment Adviser and Administrator... Brown Brothers Harriman & Co.
Subadministrator....................... 59 Wall Street Administrators, Inc.
("59 Wall Street Administrators")
Distributor............................ 59 Wall Street Distributors, Inc.
("59 Wall Street Distributors")
1940 Act............................... The Investment Company Act of 1940, as
amended.
2
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EXPENSE TABLE
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The following table provides (i) a summary of estimated expenses relating
to purchases and sales of shares of each Fund, and the aggregate annual
operating expenses of each Fund, as a percentage of average net assets of that
Fund, and (ii) an example illustrating the dollar cost of such estimated
expenses on a $1,000 investment in each Fund.
SHAREHOLDER TRANSACTION EXPENSES
Short/
U.S. Equity Intermediate
Fund Fixed Income Fund
----------- -----------------
Sales Load Imposed on Purchases............. None None
Sales Load Imposed on Reinvested Dividends.. None None
Deferred Sales Load ........................ None None
Redemption Fee.............................. None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Short/
U.S. Equity Intermediate
Fund Fixed Income Fund
----------- -----------------
Investment Advisory Fee................. 0.65% 0.40%
12b-1 Fee............................... None None
Other Expenses
Administration Fee.................... 0.15 0.15%
Expense Payment Fees.................. 0.40 0.55 0.30 0.45
---- ---- ---- ----
Total Fund Operating Expenses........... 1.20% 0.85%
==== ====
Example 1 year 3 years 5 years 10 years
------- ------ ------- ------- --------
U.S. Equity Fund: A shareholder of the
Fund would pay the following expenses
on a $1,000 investment, assuming (1)
5% annual return, and (2)redemption at
the end of each time period:......... $12 $38 $66 $145
Short/Intermediate Fixed Income Fund:
A shareholder of the Fund would pay
the following expenses on a $1,000
investment, assuming (1) 5% annual
return, and (2) redemption at the end
of each time period:................. $ 9 $27 $47 $105
The Example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown. In connection
with the Example, please note that $1,000 is currently less than each Fund's
minimum purchase requirement. The purpose of this table is to assist investors
in understanding the various costs and expenses that shareholders of each Fund
bear directly or indirectly.
Under separate agreements dated February 22, 1995, 59 Wall Street
Administrators pays each Fund's expenses, other than fees paid to Brown Brothers
Harriman & Co. under the Corporation's Administration Agreement and other than
expenses relating to the organization of each Fund. Had these expense payment
agreements not been in place, the total Fund operating expenses would have been
1.28% and 1.40% of the average annual net assets of the U.S. Equity Fund and
Short/Intermediate Fixed Income Fund, respectively, and the shareholder expenses
reflected in the example above would have been $13, $41, $70 and $155,
respectively for the U.S. Equity Fund and $14, $44, $77 and $168, respectively
for the Short/Intermediate Fixed Income Fund. After the expense payment
agreements terminate on July 1, 1997, the Directors of the Corporation estimate
3
<PAGE>
that, at each Fund's current asset level, the total Fund operating expenses may
increase to approximately 1.25% and 1.40% of the average annual net assets of
the U.S. Equity Fund and Short/Intermediate Fixed Income Fund, respectively.
(See "Expense Payment Agreements.")
For more information with respect to the expenses of each Fund see
"Management of the Corporation" herein.
FINANCIAL HIGHLIGHTS
================================================================================
The following information has been audited by Deloitte & Touche LLP,
independent auditors. This information should be read in conjunction with the
financial statements and notes thereto, which appear in the Statement of
Additional Information. The ratios of expenses and net investment income to
average net assets are not indicative of future ratios.
<TABLE>
<CAPTION>
Short/Intermediate
U.S. Equity Fund Fixed Income Fund
---------------------------------------------- ------------------------------------------------
For the years For the period For the years For the period
ended July 23, 1992 ended July 23, 1992
October 31, (commencement October 31, (commencement
--------------------------- of operations) to --------------------------- of operations) to
1995 1994 1993 October 31, 1992 1995 1994 1993 October 31, 1992
------- ------- ------- --------------- ------- ------- ------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ...................... $ 29.84 $ 28.80 $ 25.77 $ 25.00 $ 9.37 $ 10.17 $ 9.93 $ 10.00
Income from investment
operations:
Net investment income .......... 0.26 0.26 0.28 0.07 0.54 0.52 0.50 0.14
Net realized and unrealized
gain ......................... 7.15 1.05 3.04 0.76 0.39 0.74) 0.26 (0.09)
Less dividends:
Dividends to shareholders
from net investment
income ..................... (0.28) (0.17) (0.29) (0.06) (0.54) (0.52) (0.52) (0.12)
Distributions to shareholders
from net realized gains .... (0.51) (0.10) -- -- -- (0.05) -- --
Distributions to shareholders
in excess of net realized
gains ...................... -- -- -- -- -- (0.01) -- --
------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period ... $ 36.46 $ 29.84 $ 28.80 $ 25.77 $ 9.76 $ 9.37 $ 10.17 $ 9.93
======= ======= ======= ======= ======= ======= ======= =======
Cumulative investment return ..... 25.50% 4.61% 12.91% 12.18%* 10.26% (2.23%) 7.85% 1.79%*
Ratios/Supplemental Data:
Net assets, end of period
(000's omitted) .............. $32,000 $22,124 $10,992 $ 2,378 $10,830 $10,328 $ 9,729 $ 1,648
Ratio of expenses to
average net assets** ......... 1.20% 1.20% 1.20% 1.20%* 0.85% 0.85% 0.85% 0.85%*
Ratio of net investment
income to average
net assets ................... 0.84% 1.06% 1.07% 1.20%* 5.66% 5.29% 5.32% 6.23%*
Portfolio turnover rate ........ 69% 61% 52% 2% 228% 129% 149% 207%
Average commission rate
paid per share ............... $ 0.08 -- -- -- -- -- -- --
</TABLE>
- ----------
* Annualized.
** Had the expense payment agreements not been in place, the ratio of expenses
to average net assets for the years ended October 31, 1995, 1994 and 1993
and for the period ended October 31, 1992 would have been 1.28%, 1.46%,
2.09% and 5.58%, respectively for the U.S. Equity Fund and 1.40%, 1.46%,
1.46% and 6.99%, respectively, for the Short/Intermediate Fixed Income
Fund. For the same periods, the cumulative returns would have been 25.42%,
4.35%, 12.02% and (1.06)%, respectively, for the U.S. Equity Fund and
9.71%, (2.84)%, 7.24% and (5.65)%, respectively, for the Short/Intermediate
Fixed Income Fund. Furthermore, the ratio of expenses to average net assets
for the year ended October 31, 1995 reflects fees paid with brokerage
commissions and fees reduced in connection with specific agreements. Had
these arrangements not been in place, this ratio would have been 1.38% and
1.43% for the U.S. Equity Fund and Short/Intermediate Fixed Income Fund,
respectively.
Further information about performance of the Funds is contained in the
Funds' annual report to shareholders which may be obtained without charge.
4
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
================================================================================
The investment objective of the U.S. Equity Fund is to provide investors
with long-term capital growth while also generating current income. The
investment objective of the Short/Intermediate Fixed Income Fund is to provide
investors with a high level of current income consistent with minimizing price
fluctuations in net asset value and maintaining liquidity.
The investment objective of each Fund is a fundamental policy and may be
changed only with the approval of the holders of a "majority of that Fund's
outstanding voting securities as defined in the 1940 Act." (See "Additional
Information" in this Prospectus.) However, the investment policies of each Fund
as described below are not fundamental and may be changed without such approval.
The Corporation may, in the future, seek to achieve each Fund's investment
objective by investing all of the Fund's assets in a no-load, diversified,
open-end management investment company having substantially the same investment
objective as the Fund. Shareholders will receive 30 days prior written notice
with respect to any such investment.
U.S. Equity Fund
The U.S. Equity Fund is an appropriate investment for those investors
seeking superior long-term returns combined with some current income and who are
able to accept the risks inherent in equity investing.
The assets of the U.S. Equity Fund under normal circumstances are fully
invested in equity securities traded on the New York Stock Exchange, American
Stock Exchange or the National Association of Securities Dealers Automated
Quotations (NASDAQ) System. Although the assets of the U.S. Equity Fund are
invested primarily in common stocks, other securities with equity
characteristics may be purchased, including securities convertible into common
stock, trust or limited partnership interests, rights, warrants and American
Depositary Receipts. Investments generally consist of equities issued by
domestic firms; however, equities of foreign-based companies may also be
purchased if they are registered under the Securities Act of 1933.
While the Fund intends to be fully invested in equity securities, for
defensive purposes a portion of the Fund's assets may temporarily be held in
cash or invested in fixed income securities, including U.S. Government
obligations, zero coupon bonds, commercial paper, bank obligations and
repurchase agreements. These fixed income securities are securities in which the
Short/Intermediate Fixed Income Fund also may invest. (See Appendix A on page 20
for more detail.)
The U.S. Equity Fund primarily invests in medium and large sized companies
with a sound financial structure, proven management, an established industry
position and competitive products and services. In selecting individual
securities, the focus is primarily on those companies that exhibit above average
revenue and earnings growth as well as high or improving returns on investment.
Investments are also made in companies that pay out reasonable cash dividends.
The U.S. Equity Fund holds a broadly diversified portfolio representing
many sectors of the U.S. economy. This industry diversification and
participation in both growth and income oriented equities is designed to control
the portfolio's exposure to market risk and company specific risk.
5
<PAGE>
Historically, common stocks have provided investors with higher long-term
returns than other investment vehicles. The following graph illustrates that
over time, common stocks have outperformed investments in long-term government
bonds and U.S. Treasury bills.
[The following table was represented by a line chart in the printed material]
Growth of a $1 investment
made in 1926
1925 1935 1945 1955 1965 1975 1985 1995
---- ---- ---- ---- ---- ---- ---- ----
$1 $2 $4 $19 $53 $73 $279 $1,114
$1 $2 $3 $3 $3 $5 $11 $34
$1 $1 $1 $1 $2 $3 $8 $13
$1 $1 $1 $2 $2 $3 $6 $9
This graph illustrates the total return of the major classes of financial assets
since 1925, including common stocks, long-term government bonds and money market
securities as measured by U.S. Treasury bills. The Consumer Price Index is used
as a measure of inflation. This graph is not a prediction of the future
performance of any of these assets or of inflation. Source: Brown Brothers
Harriman & Co.
The U.S. Equity Fund is actively managed by a team of investment
professionals and research analysts. (See "Investment Adviser.") The Investment
Adviser analyzes economic trends and identifies stocks appropriate for
investment in the Fund. Investment decisions are the result of a disciplined
process which systematically evaluates future growth expectations and asset
valuations in relation to prevailing price levels.
Risk Factors. Although the assets of the Fund are invested primarily in
equity securities of larger, well-established companies, the portfolio is
subject to market risk, meaning that stock prices in general may decline over
short or extended periods of time. As with any equity-based mutual fund, the
investor should be aware that unfavorable economic conditions can adversely
affect corporate earnings and cause declines in stock prices.
Short/Intermediate Fixed Income Fund
The Short/Intermediate Fixed Income Fund is an appropriate investment for
those investors seeking fixed income returns greater than those provided by
money market funds and who are able to accept fluctuations in the net asset
value of their investment. The Fund is designed to have lesser price
fluctuations than long term bond funds but may have lower returns than long-term
bond funds.
The assets of the Fund under normal circumstances are primarily invested in a
broad range of high quality fixed-income securities including U.S. Government,
corporate, foreign government and municipal securities; mortgage-backed
securities and other asset-backed securities; zero coupon bonds; and money
market instruments, which include commercial paper, bank obligations (such as
certificates of deposit and bankers' acceptances), repurchase agreements, and
reverse repurchase agreements. (See Appendix A on page 20 for more detail.)
The U.S. Government securities purchased for the Fund are backed by the
"full faith and credit" of the United States or by the credit of an agency of
the U.S. Government. Corporate, foreign government and municipal bonds as well
as asset-backed securities purchased for the Fund are rated at the time of
purchase in one of the three highest quality categories of the Standard & Poor's
Corporation (meaning AAA, AA or A) or Moody's Investors Service, Inc. (meaning
Aaa, Aa or A). Corporate, foreign government and municipal notes purchased for
the Fund are rated at the time of purchase in one of the two highest quality
6
<PAGE>
categories of the Standard & Poor's Corporation (meaning SP-1 or SP-2) or
Moody's Investors Service, Inc. (meaning MIG 1 or MIG 2). All mortgage-backed
securities and zero coupon bonds are issued by, or collateralized by securities
issued by, the U.S. Government, its agencies or instrumentalities. Money market
instruments purchased for the Fund are of high quality and meet the credit
standards established by the Fund's Board of Directors. The dollar weighted
average quality of the Fund's portfolio is at least AA at all times.
Under normal circumstances, the dollar weighted average maturity of the
Fund's portfolio will range between two and four years, but at no time will it
exceed four years. There is no limitation on the maturity of a single
instrument. Given that bonds with shorter maturities are less sensitive to
interest rate movements than those with longer maturities, the four year
restriction on the Fund's dollar weighted average maturity serves to lessen the
price fluctuation of the Fund. For example, the following table illustrates the
effect a two percentage point change in interest rates would have on the price
of five bonds of varying maturities. The 10 and 20 year bonds have more exposure
to interest rate movements and are subject to greater price volatility than the
shorter term bonds.
U.S. Treasury Bond at
Par Yielding 7%
- --------------------------------------------------------------------------------
Change in Price From a Change in Price From a
2 Percentage Point 2 Percentage Point
Stated Increase In Decrease InStated
Maturity Interest Rates Interest Rates
- --------------------------------------------------------------------------------
1 Year -2% +2%
3 Years -5% +6%
5 Years -8% +9%
10 Years -13% +16%
20 Years -19% +25%
- --------------------------------------------------------------------------------
The Short/Intermediate Fixed Income Fund is actively managed by a team of
investment professionals. (See "Investment Adviser.") The Investment Adviser
analyzes and monitors economic trends, monetary policy and bond credit ratings
on a continuous basis. The holdings in the portfolio are regularly reviewed in
an effort to enhance returns.
Risk Factors. Although the assets of the Fund are invested primarily in
high quality securities, the portfolio is subject to interest rate risk and
credit risk.
Interest rate risk refers to the price fluctuation of a bond in response to
changes in interest rates. In general, bond prices and interest rates vary
inversely. As interest rates rise, bond prices fall, and conversely, as interest
rates decline, bond prices rise. Generally, bonds with longer maturities are
more sensitive to interest rate movements than those with shorter maturities.
Credit risk refers to the likelihood that an issuer will default on
interest or principal payments. The Fund invests in high quality bonds with a
rating of A or better, which reduces the portfolio's credit risk exposure.
Hedging Strategies
Subject to applicable laws and regulations and solely as a hedge against
changes in the market value of portfolio securities or securities intended to be
purchased, put and call options on stock indexes may be purchased for the U.S.
7
<PAGE>
Equity Fund and put and call options on fixed income securities may be purchased
for the Short/Intermediate Fixed Income Fund. (See Appendix B on page 24 for
more detail.) For the same purpose, put and call options on stocks may be
purchased and futures contracts on stock indexes may be entered into for the
U.S. Equity Fund and interest rate futures contracts may be entered into for the
Short/Intermediate Fixed Income Fund, although in each case the current
intention is not to do so in such a manner that more than 5% of that Fund's net
assets would be at risk.
Also subject to applicable laws and regulations and as a hedge against
changes in the market value of portfolio securities or securities intended to be
purchased, but also to enhance the income of the Short/Intermediate Fixed Income
Fund, options on fixed income securities may be written for that Fund.
Put and call option contracts may be purchased or written for each Fund
only to the extent permitted by the policies of state securities authorities in
states in which shares of that Fund are qualified for offer and sale.
Over-the-counter (OTC) options purchased are treated as not readily marketable.
(See "Investment Restrictions.")
Portfolio Brokerage
The portfolio of the U.S. Equity Fund is managed actively in pursuit of its
investment objective. As a result, the annual portfolio turnover rate for that
Fund is generally expected to be approximately 50% (excluding turnover of
obligations having a maturity of one year or less). Securities are not traded
for short-term profits but, when circumstances warrant, securities are sold
without regard to the length of time held. A 50% annual turnover rate would
occur, for example, if half of the securities in a Fund's portfolio (excluding
short-term obligations) were replaced once in a period of one year. For the
fiscal year ended October 31, 1995, the portfolio turnover rate for U.S. Equity
Fund was 69%. The amount of brokerage commissions and taxes on realized capital
gains to be borne by the shareholders of a Fund tend to increase as the turnover
rate activity increases.
In effecting securities transactions for a Fund, the Investment Adviser
seeks to obtain the best price in execution of orders. In selecting brokers, the
investment adviser considers the quality and reliability of brokerage services,
including: execution capability, reliability for prompt, accurate confirmations
and on time delivery of securities; and financial condition and responsibility.
The Investment Adviser may consider the research and other investment
information provided by a broker. Accordingly, the commissions charged by any
such broker may be greater than the amount another firm might charge if the
Investment Adviser determines in good faith that the amount of such commissions
is reasonable in relation to the value of the brokerage services and research
information provided by such broker.
The Investment Adviser may direct a portion of the U.S. Equity Fund's
securities transactions to certain unaffiliated brokers which in turn use a
portion of the commissions they receive from the U.S. Equity Fund to pay other
unaffiliated service providers on behalf of the U.S. Equity Fund for services
provided for which the U.S. Equity Fund would otherwise be obligated to pay.
Such commissions paid by the U.S. Equity Fund are at the same rate paid to other
brokers for effecting similar transactions in listed equity securities.
Brown Brothers Harriman & Co. acts as one of the principal brokers of the
U.S. Equity Fund in the purchase and sale of portfolio securities when, in the
judgment of the Investment Adviser, that firm is able to obtain a price and
execution at least as favorable as other qualified brokers. As one of the
principal brokers of the U.S. Equity Fund, Brown Brothers Harriman & Co.
receives brokerage commissions from that Fund.
The securities in which the Short/Intermediate Fixed Income Fund invests
are traded primarily in the over-the-counter market. For the fiscal year ended
October 31, 1995, the portfolio turnover rate for Short/Intermediate Fixed
Income Fund was 228%. Where possible transactions on behalf of the
Short/Intermediate Fixed Income Fund are entered directly with the issuer or
from an underwriter or market maker for the securities involved. Purchases from
8
<PAGE>
underwriters of securities may include a commission or concession paid by the
issuer to the underwriter, and purchases from dealers serving as market makers
may include a spread between the bid and asked price. The policy of the Fund
regarding purchases and sales of securities is that primary consideration will
be given to obtaining the most favorable prices and efficient executions of
transactions. In seeking to implement the Fund's policies, the Investment
Adviser effects transactions with those brokers and dealers who the Investment
Adviser believes provide the most favorable prices and are capable of providing
efficient executions. If the Investment Adviser believes such prices and
executions are obtainable from more than one broker or dealer, it may give
consideration to placing portfolio transactions with those brokers and dealers
who also furnish research and other services to the Fund or Investment Adviser.
Such services may include, but are not limited to, any one or more of the
following: information as to the availability of securities for purchase or
sale; statistical or factual information or opinions pertaining to investment;
wire services; and appraisals or evaluations of portfolio securities. Bonds and
money market securities are generally traded on a net basis and do not normally
involve either brokerage commissions or transfer taxes. (See "Portfolio
Transactions" in the Statement of Additional Information.)
On those occasions when Brown Brothers Harriman & Co. deems the purchase or
sale of a security to be in the best interests of a Fund as well as other
customers, Brown Brothers Harriman & Co., to the extent permitted by applicable
laws and regulations, may, but is not obligated to, aggregate the securities to
be sold or purchased for that Fund with those to be sold or purchased for other
customers in order to obtain best execution, including lower brokerage
commissions, if appropriate. In such event, allocation of the securities so
purchased or sold as well as any expenses incurred in the transaction are made
by Brown Brothers Harriman & Co. in the manner it considers to be most equitable
and consistent with its fiduciary obligations to its customers, including that
Fund. In some instances, this procedure might adversely affect the Fund.
Other Investment Techniques
Loans of Portfolio Securities. Loans up to 30% of the total value of the
securities of a Fund are permitted. These loans must be secured continuously by
cash or equivalent collateral or by an irrevocable letter of credit in favor of
a Fund at least equal at all times to 100% of the market value of the securities
loaned plus accrued income. By lending the securities of a Fund, that Fund's
income can be increased by the Fund's continuing to receive income on the loaned
securities as well as by the opportunity for that Fund to receive interest on
the collateral. Any appreciation or depreciation in the market price of the
borrowed securities which occurs during the term of the loan inures to that Fund
and its shareholders.
When-Issued and Delayed Delivery Securities. Securities may be purchased
for a Fund on a when-issued or delayed delivery basis. For example, delivery and
payment may take place a month or more after the date of the transaction. The
purchase price and the interest rate payable on the securities, if any, are
fixed on the transaction date. The securities so purchased are subject to market
fluctuation and no income accrues to a Fund until delivery and payment take
place. At the time the commitment to purchase securities for a Fund on a
when-issued or delayed delivery basis is made, the transaction is recorded and
thereafter the value of such securities are reflected each day in determining
that Fund's net asset value. At the time of its acquisition, a when-issued or
delayed delivery security may be valued at less than the purchase price. On
delivery dates for such transactions, such obligations are met from maturities
or sales of securities and/or from cash flow. If the right to acquire a
when-issued or delayed delivery security is disposed of prior to its
acquisition, a Fund could, as with the disposition of any other portfolio
obligation, incur a gain or loss due to market fluctuation. When-issued or
delayed delivery commitments for a Fund may not be entered into if such
commitments exceed in the aggregate 15% of the market value of that Fund's total
assets, less liabilities other than the obligations created by when-issued or
delayed delivery commitments.
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INVESTMENT RESTRICTIONS
================================================================================
The Statement of Additional Information for the Funds includes a listing of
the specific investment restrictions which govern each Fund's investment
policies. Certain of these investment restrictions are deemed fundamental
policies and may be changed only with the approval of the holders of a "majority
of a Fund's outstanding voting securities as defined in the 1940 Act" (see
"Additional Information" in this Prospectus), including a restriction that
excluding a Fund's investment of all of its investable assets in an open-end
investment company with substantially the same investment objective as the Fund,
not more than 10% of the net assets of a Fund may be invested in securities that
are subject to legal or contractual restrictions on resale.
As a non-fundamental policy, money is not borrowed for a Fund in an amount
in excess of 10% of the assets of that Fund. Money is borrowed only from banks
and only either to accommodate requests for the redemption of shares 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. Securities are not purchased
for a Fund at any time at which the amount of its borrowings exceed 5% of its
assets. Also as a non-fundamental policy, at least 65% of the value of the total
assets of the U.S. Equity Fund is invested in equity securities, and at least
65% of the value of the total assets of the Short/Intermediate Fixed Income Fund
is invested in fixed income securities.
In accordance with applicable regulations, a Fund does not purchase any OTC
option, repurchase agreement maturing in more than seven days, security of a
foreign issuer which is not registered or not exempt from registration under the
Securities Act of 1933, security of a company which, including predecessors, has
a record of less than three years of operations, or other security that is not
readily marketable, if after such purchase more than 10% of the market value of
that Fund's net assets would be represented by such investments.
Each Fund is classified as "diversified" under the 1940 Act, which means
that at least 75% of its total assets is represented by cash; securities issued
by the U.S. Government, its agencies or instrumentalities; and other securities
limited in respect of any one company to an amount not greater in value than 5%
of that Fund's total assets. The U.S. Equity Fund does not purchase more than
10% of the outstanding voting securities of any company and the
Short/Intermediate Fixed Income Fund does not purchase more than 10% of all
outstanding debt obligations of any one issuer (other than obligations issued by
the U.S. Government, its agencies or instrumentalities).
PURCHASE OF SHARES
================================================================================
An investor may open a Fund account only through 59 Wall Street
Distributors, the Funds' exclusive Distributor. The Funds' Shareholder Servicing
Agent (see page 14) and each Eligible Institution (see page 14) may establish
and amend from time to time a minimum initial and a minimum subsequent purchase
requirement for their respective customers. The Corporation reserves the right
to determine the purchase orders for Fund shares that it will accept.
Shares of each Fund are offered on a continuous basis at their net asset
value without a sales charge. Shares of each Fund may be purchased on any day
the New York Stock Exchange is open for regular trading if the Corporation
receives the purchase order and acceptable payment for such order prior to 4:00
P.M., New York time. Purchases of Fund shares are then executed at the net asset
value per share next determined on that same day. Shares are entitled to
dividends, if any, declared starting as of the first business day following the
day a purchase order is executed.
An investor who has a custody account with Brown Brothers Harriman & Co.
may place purchase orders for Fund shares with the Corporation through Brown
Brothers Harriman & Co., which as an Eligible Institution holds such shares in
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its name on behalf of that customer. For such a customer, Brown Brothers
Harriman & Co. arranges for the payment of the purchase price of Fund shares.
Brown Brothers Harriman & Co. has established for its customers a minimum
initial and a minimum subsequent purchase requirement for each Fund of $5,000,
except that the minimum initial and minimum subsequent purchase requirements for
individual retirement accounts, 401(k) plans and defined contribution plans are
$1,000.
An investor who does not have a custody account with Brown Brothers
Harriman & Co. must place purchase orders for Fund shares with the Corporation
through the Funds' Shareholder Servicing Agent. Such an investor has such shares
held directly in the investor's name on the books of the Corporation and is
responsible for arranging for the payment of the purchase price of Fund shares.
All purchase orders for initial and subsequent purchases are executed at the net
asset value per share next determined after the Corporation's custodian, State
Street Bank and Trust Company, has received payment in the form of a cashier's
check drawn on a U.S. bank, a check certified by a U.S. bank, a wire transfer or
a duly authorized bank guarantee that immediately available funds are
transferred to the Corporation on the third business day after the purchase
order has been executed. Brown Brothers Harriman & Co., the Funds' Shareholder
Servicing Agent, has established a minimum initial and a minimum subsequent
purchase requirement for each Fund of $25,000 and $10,000, respectively.
Inquiries regarding the manner in which purchases of Fund shares may be effected
and other matters pertaining to the Funds should be directed to Brown Brothers
Harriman & Co., the Funds' Shareholder Servicing Agent. (See back cover for
address and phone number.)
REDEMPTION OF SHARES
================================================================================
Shares held by Brown Brothers Harriman & Co. on behalf of a shareholder may
be redeemed by submitting a redemption request in good order to Brown Brothers
Harriman & Co. Proceeds from the redemption of Fund shares are credited to the
shareholder's account with Brown Brothers Harriman & Co.
Shares held directly in the name of a shareholder on the books of the
Corporation may be redeemed by submitting a redemption request in good order to
the Corporation through the Funds' Shareholder Servicing Agent (see back cover
for address and phone number). Proceeds resulting from such redemption are paid
by the Corporation directly to the shareholder.
A redemption request in good order must be received by the Corporation
prior to 4:00 P.M., New York time on any day the New York Stock Exchange is open
for regular trading. Such a redemption is executed at the net asset value per
share next determined on that same day. Proceeds of a redemption are paid in
"available funds" generally on the third business day after the redemption
request is executed, and in any event within seven days. For purposes of
determining the payment date, a business day is a day on which banks in the
State of New York are open for business. Shares continue to earn dividends, if
any, declared through the day a redemption request is executed.
Redemptions By the Corporation
The Funds' Shareholder Servicing Agent (see page 14) and each Eligible
Institution (see page 14) may establish and amend from time to time for their
respective customers a minimum account size. If the value of a shareholder's
holdings in a Fund falls below that amount because of a redemption of shares,
the shareholder's remaining shares may be redeemed. If such remaining shares are
to be redeemed, the shareholder is so notified and is allowed 60 days to make an
additional investment to enable the shareholder to meet the minimum requirement
before the redemption is processed. Brown Brothers Harriman & Co., as an
Eligible Institution, has established a minimum account size of $5,000 ($1,000
for eligible individual retirement accounts, 401(k) plans and defined
contribution plans) and Brown Brothers Harriman & Co., as a Shareholder
Servicing Agent, has established a minimum account size of $25,000.
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Further Redemption Information
In the event a shareholder redeems all shares held in a Fund, future
purchases of shares of that Fund by such shareholder would be subject to that
Fund's minimum initial purchase requirements.
The value of shares redeemed may be more or less than the shareholder's
cost depending on Fund performance during the period the shareholder owned such
shares. Redemptions of shares are taxable events on which a shareholder may
realize a gain or a loss.
An investor should be aware that redemptions from a Fund may not be
processed if a completed account application with a certified taxpayer
identification number has not been received.
The Corporation has reserved the right to pay the amount of a redemption
from a Fund, either totally or partially, by a distribution in kind of
securities (instead of cash) from that Fund. (See "Net Asset Value; Redemption
in Kind" in the Statement of Additional Information.)
A shareholder's right to receive payment with respect to any redemption may
be suspended or the payment of the redemption proceeds postponed for up to seven
days and for such other periods as the 1940 Act may permit. (See "Additional
Information" in the Statement of Additional Information.)
MANAGEMENT OF THE CORPORATION
================================================================================
Directors and Officers
The Directors, in addition to supervising the actions of the Administrator,
Investment Adviser and Distributor of each Fund, as set forth below, decide upon
matters of general policy. Because of the services rendered by the Investment
Adviser and the Administrator, the Corporation itself requires no employees
other than its officers, none of whom, other than the Chairman, receive
compensation from the Funds and all of whom, other than the Chairman, are
employed by 59 Wall Street Administrators. (See "Directors and Officers" in the
Statement of Additional Information.)
The Directors of the Corporation are:
J.V. Shields, Jr.
Chairman and Chief Executive Officer of
Shields & Company
Eugene P. Beard
Executive Vice President--Finance and
Operations of The Interpublic Group of
Companies
David P. Feldman
Corporate Vice President--Investment
Management of AT&T
Alan G. Lowy
Private Investor
Arthur D. Miltenberger
Vice President and Chief Financial Officer of
Richard K. Mellon and Sons
Investment Adviser
The Investment Adviser to each Fund is Brown Brothers Harriman & Co.,
Private Bankers, a New York limited partnership established in 1818. The firm is
subject to examination and regulation by the Superintendent of Banks of the
State of New York and by the Department of Banking of the Commonwealth of
Pennsylvania. The firm is also subject to supervision and examination by the
Commissioner of Banks of the Commonwealth of Massachusetts.
Brown Brothers Harriman & Co. provides investment advice and portfolio
management services to each Fund. Subject to the general supervision of the
Corporation's Directors, Brown Brothers Harriman & Co. makes the day-to-day
investment decisions for each Fund, places the purchase and sale orders for the
portfolio transactions of each Fund, and generally manages each Fund's
investments. Brown Brothers Harriman & Co. provides a broad range of investment
management services for customers in the United States and abroad. At June 30,
1995, it managed total assets of approximately $20 billion.
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<PAGE>
Mr. Eugene C. Rainis is the partner in charge of fixed income management
and fixed income investment policy at Brown Brothers Harriman & Co. Mr. Rainis
holds a B.S. from Fordham University, a M.B.A. from the Wharton School of the
University of Pennsylvania and is a Chartered Financial Analyst. He joined Brown
Brothers Harriman & Co. in 1965. Mr. Glenn E. Baker and Mr. John A. Lovito are
the portfolio managers for the Short/Intermediate Fixed Income Fund. Mr. Baker
holds both a B.A. and a M.B.A. from the University of Michigan. He joined Brown
Brothers Harriman & Co. in 1991. Mr. Lovito holds both a B.A. and a M.B.A. from
Fordham University. He joined Brown Brothers Harriman & Co. in 1986.
Mr. Donald B. Murphy is the partner responsible for U.S. equity investment
management at Brown Brothers Harriman & Co. Mr. Murphy holds a B.A. from Yale
University and a M.B.A. from Columbia University. He joined Brown Brothers
Harriman & Co. in 1966. Mr. Harry J. Martin and Mr. William M. Weiss are the
portfolio managers for the U.S. Equity Fund. Mr. Martin holds a B.S. from the
U.S. Merchant Marine Academy, and a M.B.A. from Harvard Business School. He
joined Brown Brothers Harriman & Co. in 1973. Mr. Weiss holds a B.A. from
Colgate University, a M.B.A. from the University of Chicago, and is a Chartered
Financial Analyst. He joined Brown Brothers Harriman & Co. in 1987.
As compensation for the services rendered and related expenses such as
salaries of advisory personnel borne by Brown Brothers Harriman & Co. under the
Investment Advisory Agreements, Brown Brothers Harriman & Co. receives from the
U.S. Equity Fund and the Short/Intermediate Fixed Income Fund an annual fee,
computed daily and payable monthly, equal to 0.65% and 0.40%, respectively, of
the average daily net assets of each Fund. Brown Brothers Harriman & Co. also
receives an administration fee and a shareholder servicing/eligible institution
fee from each Fund equal to 0.15% and 0.25%, respectively, of each Fund's
average daily net assets.
The investment advisory services of Brown Brothers Harriman & Co. to each
Fund are not exclusive under the terms of the Investment Advisory Agreements.
Brown Brothers Harriman & Co. is free to and does render investment advisory
services to others, including other registered investment companies.
Pursuant to a license agreement between the Corporation and Brown Brothers
Harriman & Co. dated September 5, 1990, as amended as of December 15, 1993, the
Corporation may continue to use in its name "59 Wall Street", the current and
historic address of Brown Brothers Harriman & Co. The agreement may be
terminated by Brown Brothers Harriman & Co. at any time upon written notice to
the Corporation upon the expiration or earlier termination of any investment
advisory agreement between a Fund or any investment company in which a series of
the Corporation invests all of its assets and Brown Brothers Harriman & Co.
Termination of the agreement would require the Corporation to change its name
and the name of each Fund to eliminate all reference to "59 Wall Street".
Pursuant to license agreements between Brown Brothers Harriman & Co. and
each of 59 Wall Street Administrators and 59 Wall Street Distributors (each a
"Licensee"), dated June 22, 1993 and June 8, 1990, respectively, each Licensee
may continue to use in its name "59 Wall Street", the current and historic
address of Brown Brothers Harriman & Co., only if Brown Brothers Harriman & Co.
does not terminate the respective license agreement, which would require the
Licensee to change its name to eliminate all reference to "59 Wall Street".
Administrator
Brown Brothers Harriman & Co. acts as Administrator for the Corporation.
(See "Administrator" in the Statement of Additional Information.)
In its capacity as Administrator, Brown Brothers Harriman & Co. administers
all aspects of the Corporation's operations subject to the supervision of the
Corporation's Directors except as set forth below under "Distributor". In
connection with its responsibilities as Administrator and at its own expense,
Brown Brothers Harriman & Co. (i) provides the Corporation with the services of
persons competent to perform such supervisory, administrative and clerical
functions as are necessary in order to provide effective administration of the
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Corporation, including the maintenance of certain books and records; (ii)
oversees the performance of administrative and professional services to the
Corporation by others, including the Funds' Custodian, Transfer and Dividend
Disbursing Agent; (iii) provides the Corporation with adequate office space and
communications and other facilities; and (iv) prepares and/or arranges for the
preparation, but does not pay for, the periodic updating of the Corporation's
registration statement and each Fund's prospectus, the printing of such
documents for the purpose of filings with the Securities and Exchange Commission
and state securities administrators, and the preparation of tax returns for each
Fund and reports to each Fund's shareholders and the Securities and Exchange
Commission.
For the services rendered to the Corporation and related expenses borne by
Brown Brothers Harriman & Co., as Administrator of the Corporation, Brown
Brothers Harriman & Co. receives from each Fund an annual fee, computed daily
and payable monthly, equal to 0.15% of that Fund's average daily net assets.
Pursuant to a Subadministrative Services Agreement with Brown Brothers
Harriman & Co., 59 Wall Street Administrators performs such subadministrative
duties for the Corporation as are from time to time agreed upon by the parties.
The offices of 59 Wall Street Administrators are located at 6 St. James Avenue,
Boston, Massachusetts 02116. 59 Wall Street Administrators is a wholly-owned
subsidiary of Signature Financial Group, Inc. ("SFG"). SFG is not affiliated
with Brown Brothers Harriman & Co. 59 Wall Street Administrators'
subadministrative duties may include providing equipment and clerical personnel
necessary for maintaining the organization of the Corporation, participation in
the preparation of documents required for compliance by the Corporation with
applicable laws and regulations, preparation of certain documents in connection
with meetings of Directors and shareholders of the Corporation, and other
functions that would otherwise be performed by the Administrator as set forth
above. For performing such subadministrative services, 59 Wall Street
Administrators receives such compensation as is from time to time agreed upon
but not in excess of the amount paid to the Administrator from the Funds.
Shareholder Servicing Agent
The Corporation has entered into a shareholder servicing agreement with Brown
Brothers Harriman & Co. pursuant to which Brown Brothers Harriman & Co., as
agent for the Corporation with respect to the Funds, among other things: answers
inquiries from shareholders of and prospective investors in the Funds regarding
account status and history, the manner in which purchases and redemptions of
Fund shares may be effected and certain other matters pertaining to the Funds;
assists shareholders of and prospective investors in the Funds in designating
and changing dividend options, account designations and addresses; and provides
such other related services as the Corporation or a shareholder of or
prospective investor in a Fund may reasonably request. For these services, Brown
Brothers Harriman & Co. receives from each Fund an annual fee, computed daily
and payable monthly, equal to 0.25% of that Fund's average daily net assets
represented by shares owned during the period for which payment was being made
by shareholders who did not hold their account with an eligible institution.
Eligible Institutions
The Corporation has entered into an eligible institution agreement with Brown
Brothers Harriman & Co. pursuant to which Brown Brothers Harriman & Co., as
agent for the Corporation with respect to shareholders of and prospective
investors in the Funds who have a custody account with Brown Brothers Harriman &
Co., among other things: provides necessary personnel and facilities to
establish and maintain certain shareholder accounts and records enabling it to
hold, as agent, its customers' shares in its name or its nominee name on the
shareholder records of the Corporation; assists in processing purchase and
redemption transactions; arranges for the wiring of funds; transmits and
receives funds in connection with customer orders to purchase or redeem shares
of the Funds; provides periodic statements showing a customer's account balance
and, to the extent practicable, integrates such information with information
concerning other customer transactions otherwise effected with or through it;
furnishes, either separately or on an integrated basis with other reports sent
14
<PAGE>
to a customer, monthly and annual statements and confirmations of all purchases
and redemptions of Fund shares in a customer's account; transmits proxy
statements, annual reports, updated prospectuses and other communications from
the Corporation to its customers; and receives, tabulates and transmits to the
Corporation proxies executed by its customers with respect to meetings of
shareholders of the Funds. For these services, Brown Brothers Harriman & Co.
receives from each Fund an annual fee, computed daily and payable monthly, equal
to 0.25% of that Fund's average daily net assets represented by shares owned
during the period for which payment was being made by customers for whom Brown
Brothers Harriman & Co. was the holder or agent of record.
The eligible institution agreement with Brown Brothers Harriman & Co. is
non-exclusive and the Corporation expects from time to time to enter into
similar agreements with other financial institutions. At such time as any such
similar agreement is entered into, references in this Prospectus to shareholders
of and prospective investors in the Funds who have a custody account with Brown
Brothers Harriman & Co. shall include such shareholders of and prospective
investors in the Funds who have an account with the financial institution which
entered into such other agreement, except as expressly stated in this
Prospectus.
Expense Payment Agreements
Under separate agreements dated February 22, 1995, 59 Wall Street
Administrators pays each Fund's expenses (see "Expense Table"), other than fees
paid to Brown Brothers Harriman & Co. under the Corporation's Administration
Agreement and other than expenses relating to the organization of each Fund. In
return, 59 Wall Street Administrators receives a fee from each Fund such that
after such payment the aggregate expenses of each Fund do not exceed an agreed
upon annual rate, currently 1.20% and 0.85% of the average daily net assets of
the U.S. Equity Fund and the Short/Intermediate Fixed Income Fund, respectively.
Such fees are computed daily and paid monthly. During the fiscal year ended
October 31, 1995, 59 Wall Street Administrators incurred $290,885 and $125,150
in expenses, including investment advisory fees of $167,339 and $40,190 and
shareholder servicing/eligible institution fees of $64,361 and $25,119, on
behalf of the U.S. Equity Fund and the Short/Intermediate Fixed Income Fund,
respectively, and received fees of $265,849 and $65,894 from the U.S. Equity
Fund and the Short/Intermediate Fixed Income Fund, respectively.
Each expense payment agreement will terminate on July 1, 1997. After the
expense payment agreements terminate, the Directors of the Corporation estimate
that, at each Fund's current level, the total operating expenses of each Fund
may increase to approximately 1.25% and 1.40% of the average annual net assets
of the U.S. Equity Fund and Short/Intermediate Fixed Income Fund, respectively.
The expenses of each Fund paid by 59 Wall Street Administrators under the
agreements include the shareholder servicing/eligible institution fees, the
compensation of the Directors of the Corporation; governmental fees; interest
charges; taxes; membership dues in the Investment Company Institute allocable to
the Fund; fees and expenses of independent auditors, of legal counsel and of any
transfer agent, custodian, registrar or dividend disbursing agent of a Fund;
insurance premiums; expenses of calculating the net asset value of shares of a
Fund; expenses of preparing, printing and mailing prospectuses, reports,
notices, proxy statements and reports to shareholders and to governmental
officers and commissions; expenses of shareholder meetings; expenses relating to
the issuance, registration and qualification of shares of a Fund; and expenses
connected with the execution, recording and settlement of portfolio security
transactions; and the expenses associated with the investments advisory
agreement.
Distributor
59 Wall Street Distributors acts as exclusive Distributor of shares of each
Fund. Its office is located at 6 St. James Avenue, Boston, Massachusetts 02116.
59 Wall Street Distributors is a wholly-owned subsidiary of SFG. SFG and its
affiliates currently provide administration and distribution services for other
15
<PAGE>
registered investment companies. The Corporation pays for the preparation,
printing and filing of copies of the Corporation's registration statements and
each Fund's prospectus as required under federal and state securities laws. (See
"Distributor" in the Statement of Additional Information.)
59 Wall Street Distributors holds itself available to receive purchase orders
for Fund shares.
Custodian, Transfer and
Dividend Disbursing Agent
State Street Bank and Trust Company ("State Street" or the "Custodian"),
225 Franklin Street, P.O. Box 351, Boston, Massachusetts 02110, is Custodian,
Transfer and Dividend Disbursing Agent for each Fund.
As Custodian, it is responsible for maintaining books and records of each
Fund's portfolio transactions and holding each Fund's portfolio securities and
cash pursuant to a custodian agreement with the Corporation. Cash is held for
each Fund in demand deposit accounts at the Custodian. Subject to the
supervision of the Administrator, the Custodian maintains each Fund's accounting
and portfolio transaction records and for each day computes each Fund's net
asset value. As Transfer and Dividend Disbursing Agent it is responsible for
maintaining the books and records detailing the ownership of each Fund's shares.
Independent Auditors
Deloitte & Touche LLP are the independent auditors for the Funds.
NET ASSET VALUE
================================================================================
Each Fund's net asset value per share is determined once daily at 4:00
P.M., New York time on each day the New York Stock Exchange is open for regular
trading.
The determination of each Fund's net asset value per share is made by
subtracting from the value of the total assets of a Fund the amount of its
liabilities and dividing the difference by the number of shares of that Fund
outstanding at the time the determination is made.
Values of assets in each Fund's portfolio are determined on the basis of
their market or other fair value. (See "Net Asset Value; Redemption in Kind" in
the Statement of Additional Information.)
DIVIDENDS AND DISTRIBUTIONS
================================================================================
Substantially all of each Fund's net investment income, together with a
discretionary portion of any net short-term capital gains, is declared and paid
to shareholders as a dividend, semi-annually in the U.S. Equity Fund and monthly
in the Short/Intermediate Fixed Income Fund. Substantially all of each Fund's
realized net long-term capital gains, if any, are declared and paid to
shareholders on an annual basis as a capital gains distribution. An additional
dividend and/or capital gains distribution may be made to the extent necessary
to avoid the imposition of federal excise tax on a Fund. (See "Taxes" below.)
Dividends and capital gains distributions are payable to shareholders of record
on the record date.
Unless a shareholder otherwise elects, dividends and capital gains
distributions are automatically reinvested in additional Fund shares without
reference to the minimum subsequent purchase requirement. The Corporation
reserves the right to discontinue, alter or limit the automatic reinvestment
privilege at any time, but will provide shareholders prior written notice of any
such discontinuance, alteration or limitation.
A shareholder whose shares are held by Brown Brothers Harriman & Co. on
behalf of the shareholder and who elects to have dividends and capital gains
distributions paid in cash has the amount of such dividends and capital gains
distributions automatically credited to the shareholder's account with Brown
Brothers Harriman & Co. Such a shareholder who elects to have dividends and
capital gains distributions reinvested is able to do so, in both whole and
fractional shares.
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A shareholder whose shares are held directly in the shareholder's name on
the books of the Corporation and who elects to have dividends and capital gains
distributions paid in cash receives a check in the amount of such dividends and
capital gains distributions. Such a shareholder who elects to have dividends and
capital gains distributions reinvested is able to do so, in both whole and
fractional shares.
TAXES
================================================================================
Each year, the Corporation intends to qualify each Fund and elect that each
Fund be treated as a separate "regulated investment company" under the Internal
Revenue Code of 1986, as amended. Accordingly, the Funds are not subject to
federal income taxes on their net income and realized net long-term capital
gains that are distributed to their shareholders. A 4% non-deductible excise tax
is imposed on a Fund to the extent that certain distribution requirements for
that Fund for each calendar year are not met. The Corporation intends to meet
such requirements.
Dividends are taxable to shareholders of a Fund as ordinary income, whether
such dividends are paid in cash or reinvested in additional shares. Dividends
paid from the U.S. Equity Fund may be eligible for the dividends-received
deduction allowed to corporate shareholders because all or a portion of that
Fund's net income may consist of dividends paid by domestic corporations.
Capital gains distributions are taxable to shareholders as long-term capital
gains, whether paid in cash or reinvested in additional shares and regardless of
the length of time a particular shareholder has held Fund shares.
Any dividend or capital gains distribution has the effect of reducing the
net asset value of Fund shares held by a shareholder by the same amount as the
dividend or capital gains distribution. If the net asset value of the shares
should be reduced below a shareholder's cost as a result of such a dividend or
capital gains distribution, the dividend or capital gains distribution, although
constituting a return of invested capital, would be taxable as described above.
Any gain or loss realized on the redemption of Fund shares by a shareholder who
is not a dealer in securities is treated as long-term capital gain or loss if
the shares have been held for more than one year, and otherwise as short-term
capital gain or loss. However, any loss realized by a shareholder upon the
redemption of shares in a Fund held one year or less is treated as a long-term
capital loss to the extent of any long-term capital gains distributions received
by the shareholder with respect to such shares.
Under U.S. Treasury regulations, the Corporation and each Eligible
Institution are required to withhold and remit to the U.S. Treasury a portion
(31%) of dividends and capital gains distributions on the accounts of those
shareholders who fail to provide a correct taxpayer identification number
(Social Security Number for individuals) or to make required certifications, or
who have been notified by the Internal Revenue Service that they are subject to
such withholdings. Prospective investors should submit an IRS Form W-9 to avoid
such withholding.
State and Local Taxes
The treatment of each Fund and its shareholders in those states which have
income tax laws might differ from treatment under the federal income tax laws.
Distributions to shareholders may be subject to additional state and local
taxes. Shareholders are urged to consult their tax advisors regarding any state
or local taxes.
Foreign Investors
Each Fund is designed for investors who are either citizens of the United
States or aliens subject to United States income tax. Prospective investors who
are not citizens of the United States and who are not aliens subject to United
States income tax are subject to United States withholding tax on the entire
amount of all dividends. Therefore, such investors should not invest in a Fund
since alternative investments are available which would not be subject to United
States withholding tax.
17
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Other Information
Annual notification as to the tax status of capital gains distributions, if
any, are provided to shareholders shortly after October 31, the end of each
Fund's fiscal year. Additional tax information is mailed to shareholders in
January.
This tax discussion is based on the tax laws and regulations in effect on
the date of this Prospectus, however such laws and regulations are subject to
change. Shareholders and prospective investors are urged to consult their tax
advisors regarding specific questions relevant to their particular
circumstances.
DESCRIPTION OF SHARES
================================================================================
The Corporation is an open-end management investment company organized on
July 16, 1990 as a corporation under the laws of the State of Maryland. Its
offices are located at 6 St. James Avenue, Boston, Massachusetts 02116; its
telephone number is (617) 423-0800.
The Articles of Incorporation currently permit the Corporation to issue
2,500,000,000 shares of common stock, par value $.001 per share, of which
25,000,000 shares have been classified as shares of the U.S. Equity Fund and
25,000,000 as shares of the Short/Intermediate Fixed Income Fund. The Board of
Directors may increase the number of shares the Corporation is authorized to
issue without the approval of shareholders. The Board of Directors also has the
power to designate one or more series of shares of common stock and to classify
and reclassify any unissued shares with respect to such series. Currently there
are four such series in addition to the Funds.
Each share of the Fund represents an equal proportional interest in the
Fund with each other share. Upon liquidation of the Fund, shareholders are
entitled to share pro rata in the net assets of the Fund available for
distribution to shareholders.
Shareholders of each Fund are entitled to a full vote for each full share
held and to a fractional vote for fractional shares. The voting rights of
shareholders are not cumulative. Shares have no preemptive or conversion rights.
The rights of redemption are described elsewhere herein. Shares are fully paid
and nonassessable by the Corporation. It is the intention of the Corporation not
to hold meetings of shareholders annually. The Directors may call meetings of
shareholders for action by shareholder vote as may be required by the 1940 Act
or as may be permitted by the Articles of Incorporation or By-laws. Shareholders
have under certain circumstances (e.g., upon application and submission of
certain specified documents to the Directors by a specified number of
shareholders) the right to communicate with other shareholders in connection
with requesting a meeting of shareholders for the purpose of removing one or
more Directors. Shareholders also have the right to remove one or more Directors
without a meeting by a declaration in writing by a specified number of
shareholders.
The By-laws of the Corporation provide that the presence in person or by
proxy of the holders of record of one third of the shares of a Fund outstanding
and entitled to vote thereat shall constitute a quorum at all meetings of
shareholders of that Fund, except as otherwise required by applicable law. The
By-laws further provide that all questions shall be decided by a majority of the
votes cast at any such meeting at which a quorum is present, except as otherwise
required by applicable law.
The Corporation's Articles of Incorporation provide that, at any meeting of
shareholders of a Fund, Brown Brothers Harriman & Co., as an Eligible
Institution, may vote any shares as to which Brown Brothers Harriman & Co. is
the agent of record and which are otherwise not represented in person or by
proxy at the meeting, proportionately in accordance with the votes cast by
holders of all shares otherwise represented at the meeting in person or by proxy
as to which Brown Brothers Harriman & Co. is the agent of record. Any shares so
voted by Brown Brothers Harriman & Co. are deemed represented at the meeting for
purposes of quorum requirements.
18
<PAGE>
ADDITIONAL INFORMATION
================================================================================
As used in this Prospectus, the term "majority of a Fund's outstanding
voting securities as defined in the 1940 Act" currently means the vote of (i)
67% or more of that Fund's shares present at a meeting, if the holders of more
than 50% of the outstanding voting securities of that Fund are present in person
or represented by proxy; or (ii) more than 50% of that Fund's outstanding voting
securities, whichever is less.
Fund shareholders receive semi-annual reports containing unaudited
financial statements and annual reports containing financial statements audited
by independent auditors.
A confirmation of each purchase and redemption transaction is issued on
execution of that transaction.
Each Fund's performance may be used from time to time in shareholder
reports or other communications to shareholders or prospective investors.
Performance figures are based on historical earnings and are not intended to
indicate future performance. Performance information may include a Fund's
investment results and/or comparisons of its investment results to various
unmanaged indexes (such as the Standard & Poor's 500 Index, Donoghue's Money
Fund Index and Shearson Lehman Intermediate Bond Index). To the extent that
unmanaged indexes are so included, the same indexes are used on a consistent
basis. A Fund's investment results as used in such communications are calculated
on a total rate of return basis in the manner set forth below. From time to
time, fund rankings from various sources, such as Micropal, may be quoted.
Period and average annualized "total rates of return" may be provided in
such communications. The "total rate of return" refers to the change in the
value of an investment in a Fund over a stated period based on any change in net
asset value per share and including the value of any shares purchasable with any
dividends or capital gains distributions during such period. Period total rates
of return may be annualized. An annualized total rate of return is a compounded
total rate of return which assumes that the period total rate of return is
generated over a one year period, and that all dividends and capital gains
distributions are reinvested. An annualized total rate of return is slightly
higher than a period total rate of return if the period is shorter than one
year, because of the assumed reinvestment.
The Short/Intermediate Fixed Income Fund's "yield" and "effective yield"
may be used from time to time in shareholder reports or other communications to
shareholders or prospective investors. Both yield figures are based on
historical earnings and are not intended to indicate future performance. The
"yield" of the Fund refers to the projected income generated by an investment in
the Fund over a 30-day or one-month period (which period is stated). This income
is then annualized. 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 "yield"
because of the compounding effect of this assumed reinvestment.
This Prospectus omits certain of the information contained in the Statement
of Additional Information and the Registration Statement filed with the
Securities and Exchange Commission. The Statement of Additional Information may
be obtained from 59 Wall Street Distributors without charge and the Registration
Statement may be obtained from the Securities and Exchange Commission upon
payment of the fee prescribed by the Rules and Regulations of the Commission.
19
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APPENDIX A--THE SHORT/INTERMEDIATE FIXED INCOME FUND
================================================================================
This Appendix is intended to provide descriptions of the securities the
Fund may purchase. However, the Fund may purchase other securities not mentioned
below if they meet the quality and maturity guidelines set forth in the Fund's
Investment Policies.
- --------------------------------------------------------------------------------
U.S. Government Securities
Assets of the Fund may be invested in securities issued or guaranteed by
the U.S. Government, its agencies or instrumentalities. These securities,
including those which are guaranteed by federal agencies or instrumentalities,
may or may not be backed by the "full faith and credit" of the United States. In
the case of securities not backed by the full faith and credit of the United
States, it may not be possible to assert a claim against the United States
itself in the event the agency or instrumentality issuing or guaranteeing the
security for ultimate repayment does not meet its commitments. Securities which
are not backed by the full faith and credit of the United States include, but
are not limited to, securities of the Tennessee Valley Authority, the Federal
National Mortgage Association (FNMA) and the U.S. Postal Service, each of which
has a limited right to borrow from the U.S. Treasury to meet its obligations,
and securities of the Federal Farm Credit System, the Federal Home Loan Banks,
the Federal Home Loan Mortgage Corporation (FHLMC) and the Student Loan
Marketing Association, the obligations of each of which may be satisfied only by
the individual credit of the issuing agency. Securities which are backed by the
full faith and credit of the United States include Treasury bills, Treasury
notes, Treasury bonds and pass through securities of the Government National
Mortgage Association (GNMA), the Farmers Home Administration and the
Export-Import Bank. There is no percentage limitation with respect to
investments in U.S. Government securities.
Corporate and Foreign Government Debt Securities
Assets of the Fund may be invested in debt securities of U.S. corporations,
including bonds and notes. Issuing entities include public utilities,
transportation related firms, manufacturing and service companies, and financial
institutions. Assets of the Fund may also be invested in U.S. dollar debt
securities of supranational institutions, sovereign entities and select high
grade foreign corporate obligations registered or exempt from registration under
the Securities Act of 1933. Bonds tend to have original maturities ranging from
10 to 30 years, whereas notes usually mature in 10 years or less.
Municipal Securities
Municipal securities are debt securities issued by states, local
governments and regional authorities which provide both federally tax exempt and
taxable income. The Fund may invest in municipal bonds, most commonly issued as
either General Obligation Bonds (bonds backed by the municipality's pledge of
full faith, credit and taxing power) or Revenue Bonds (bonds backed by the
revenue of a specific project, special tax or public facility). The Fund may
also invest in municipal notes, including Tax and Revenue Anticipation Notes,
Bond Anticipation Notes, and Tax Exempt Commercial Paper. While these
aforementioned securities are generally exempt from federal income taxes, the
Fund intends to mostly purchase municipal securities that are not federally tax
exempt, such as Private Activity Bonds. Municipalities most commonly issue
taxable municipal securities when a certain portion of the issue is deemed to
benefit or finance a private entity and that portion also exceeds the
municipality's federally determined budget for such financing.
Mortgage-Backed Securities
Assets of the Fund also include mortgage-backed securities (MBS) which are
issued by, or are collateralized by securities guaranteed by, the U.S.
Government, its agencies or instrumentalities. These securities represent an
20
<PAGE>
undivided interest in a pool of residential mortgages. These securities,
including those issued by GNMA, FNMA and FHLMC, provide investors with payments
consisting of both interest and principal as the mortgages in the underlying
pools are repaid. Unlike conventional bonds, MBS pay back principal over the
life of the MBS rather than at maturity. Thus, a holder of the MBS, such as the
Fund, would receive monthly scheduled payments of principal and interest and may
receive unscheduled principal prepayments representing payments on the
underlying mortgages. At the time the Fund reinvests the scheduled principal
payments and any unscheduled prepayment of principal that it receives, the Fund
may receive a rate of interest which is higher or lower than the rate of
interest paid on the existing MBS, thus affecting the yield of the Fund.
MBS which may be purchased for the Fund include:
Fixed Rate Mortgage Securities. Also known as fixed rate pass-through
securities, these are MBS's backed by pools of mortgages with fixed interest
rates. The principal and interest payments generated by the underlying mortgages
are "passed-through" pro rata to investors. Complete return of principal and
final maturity of the pass-through occurs only after the last mortgage in the
pool has been retired. These securities are the most common type of MBS, and the
mortgage pool generally is comprised of either 15- or 30-year mortgages.
Adjustable Rate Mortgage Securities (ARMS). Similar in structure to the
fixed rate pass-through securities, ARMS are MBS's backed by pools of mortgages
with adjustable or floating rates. Not unlike other fixed-income securities, the
market value of ARMS may vary with changes in market interest rates. Due to the
floating rate nature of the interest payments on the underlying mortgages, ARMS
generally entail less risk of a decline in market value during periods of rising
rates than comparable fixed-rate investments but have less potential for capital
appreciation during periods of falling rates.
Collateralized Mortgage Obligations (CMO's). CMO's are MBS securities
collateralized by fixed or adjustable rate mortgages or MBS's. CMO's are
distinguished from pass-throughs by the method used for distributing cash flow.
CMO's are issued in classes or series of mortgages with varying maturities and
are often retired in sequence. Because the CMO cash flow is distributed
sequentially, instead of pro rata as with traditional pass-through securities,
the returns and average lives of certain classes of CMO's may be more
predictable.
Asset-Backed Securities
Asset-backed securities represent interests in pools of loans (generally
unrelated to mortgage loans). Interest and principal payments ultimately depend
on payment of the underlying loans by individuals, although the securities may
be supported by letters of credit or other credit enhancements. The value of
asset-backed securities may also be affected by the creditworthiness of the
servicing agent for the loan pool, the originator of the loans or the financial
institution providing the credit enhancement.
Zero Coupon Bonds
Zero coupon bonds purchased for the Fund are issued by, or collateralized
by securities issued by, the U.S. Government, its agencies or instrumentalities.
Such issues include:
U.S. Treasury STRIPS (separate trading of registered interest and principal
of securities) are created when the coupon payments and the principal payment
are stripped from an outstanding Treasury bond by the Federal Reserve Bank.
Bonds issued by the Resolution Funding Corporation (REFCORP), the Financing
Corporation (FICO) and the Tennessee Valley Authority (TVA) can also be stripped
in this fashion.
U.S. Treasury STRIPS are also created when a dealer deposits a Treasury
security or a federal agency security with a custodian for safekeeping and then
sells the coupon payments and principal payment that is generated by this
security separately. Proprietary receipts, such as certificates of accrual on
21
<PAGE>
Treasury securities (CATS), Treasury investment growth receipts (TIGRs) and
generic Treasury receipts (TRs) are stripped U.S. Treasury securities separated
into their component parts through custodial arrangements established by the
broker sponsors.
Zero coupon bonds can be issued directly by federal agencies and
instrumentalities. Such issues of zero coupon bonds are originated in the form
of a zero coupon bond and are not created by stripping an outstanding bond.
Zero coupon bonds do not make regular interest payments. Instead they are
sold at a deep discount from their face value. Because a zero coupon bond does
not pay current income, its price can be very volatile when interest rates
change. In calculating its daily income, the Fund takes into account as income a
portion of the difference between a zero coupon bond's purchase price and its
face value.
Commercial Paper
Assets of the Fund may be invested in commercial paper including variable
rate demand master notes issued by U.S. corporations or by non-U.S. corporations
which are direct parents or subsidiaries of U.S. corporations.
Master notes are demand obligations that permit the investment of
fluctuating amounts at varying market rates of interest pursuant to arrangements
between the issuer and a U.S. commercial bank acting as agent for the payees of
such notes. Master notes are callable on demand, but are not marketable to third
parties. Consequently, the right to redeem such notes depends on the borrower's
ability to pay on demand.
At the date of investment, commercial paper must be rated within the
highest rating category for short-term debt obligations by at least two (unless
only rated by one) nationally recognized statistical rating organizations (e.g.,
Moody's and S&P) or, if unrated, are of comparable quality as determined by or
under the direction of the Board of Directors. Any commercial paper issued by a
non-U.S. corporation must be U.S. dollar denominated and not subject to non-U.S.
withholding tax at the time of purchase. Aggregate investments in non-U.S.
commercial paper of non-U.S. issuers cannot exceed 10% of the Fund's net assets.
Bank Obligations
Assets of the Fund may be invested in U.S. dollar-denominated negotiable
certificates of deposit, fixed time deposits and bankers' acceptances of banks,
savings and loan associations and savings banks organized under the laws of the
United States or any state thereof, including obligations of non-U.S. branches
of such banks, or of non-U.S. banks or their U.S. or non-U.S. branches, provided
that in each case, such bank has more than $500 million in total assets, and has
an outstanding short-term debt issue rated within the highest rating category
for short-term debt obligations by at least two (unless only rated by one)
nationally recognized statistical rating organizations (e.g., Moody's and S&P)
or, if unrated, are of comparable quality as determined by or under the
direction of the Board of Directors. See "Corporate Bond and Commercial Paper
Ratings" in the Statement of Additional Information. There is no percentage
limitation with respect to investments in negotiable certificates of deposit,
fixed time deposits and bankers' acceptances of U.S. branches of U.S. banks and
U.S. branches of non-U.S. banks that are subject to the same regulation as U.S.
banks. While early withdrawals are not contemplated, fixed time deposits are not
readily marketable and may be subject to early withdrawal penalties, which may
vary. Assets of the Fund are not invested in obligations of Brown Brothers
Harriman & Co., the Administrator, the Distributor, or in the obligations of the
affiliates of any such organization or in fixed time deposits with a maturity of
over seven calendar days, or in fixed time deposits with a maturity of from two
business days to seven calendar days if more than 10% of the Fund's total assets
would be invested in such deposits.
22
<PAGE>
Repurchase Agreements
Repurchase agreements may be entered into only with a "primary dealer" (as
designated by the Federal Reserve Bank of New York) in U.S. Government
obligations. This is an agreement in which the seller (the "Lender") of a
security agrees to repurchase from the Fund the security sold at a mutually
agreed upon time and price. As such, it is viewed as the lending of money to the
Lender. The resale price normally is in excess of the purchase price, reflecting
an agreed upon interest rate. The rate is effective for the period of time
assets of the Fund are invested in the agreement and is not related to the
coupon rate on the underlying security. The period of these repurchase
agreements is usually short, from overnight to one week, and at no time are
assets of the Fund invested in a repurchase agreement with a maturity of more
than one year. The securities which are subject to repurchase agreements,
however, may have maturity dates in excess of one year from the effective date
of the repurchase agreement. The Fund always receives as collateral securities
which are issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. Collateral is marked to the market daily and has a market
value including accrued interest at least equal to 100% of the dollar amount
invested on behalf of the Fund in each agreement along with accrued interest.
Payment for such securities is made for the Fund only upon physical delivery or
evidence of book entry transfer to the account of State Street Bank and Trust
Company, the Fund's Custodian. If the Lender defaults, the Fund might incur a
loss if the value of the collateral securing the repurchase agreement declines
and might incur disposition costs in connection with liquidating the collateral.
In addition, if bankruptcy proceedings are commenced with respect to the Lender,
realization upon the collateral on behalf of the Fund may be delayed or limited
in certain circumstances. A repurchase agreement with more than seven days to
maturity may not be entered into for the Fund if, as a result, more than 10% of
the market value of the Fund's total assets would be invested in such repurchase
agreements together with any other investment being held for the Fund for which
market quotations are not readily available.
Reverse Repurchase Agreements
Reverse repurchase agreements may be entered into only with a "primary
dealer" (as designated by the Federal Reserve Bank of New York) in U.S.
Government obligations. This is an agreement in which the Corporation agrees for
the Fund to repurchase securities sold by it at a mutually agreed upon time and
price. As such, it is viewed as the borrowing of money for the Fund. Proceeds of
borrowings under reverse repurchase agreements is invested for the Fund. This is
the speculative factor known as "leverage". If interest rates rise during the
term of a reverse repurchase agreement utilized for leverage, the value of the
securities to be repurchased for the Fund as well as the value of securities
purchased with the proceeds will decline. Proceeds of a reverse repurchase
transaction are not invested for a period which exceeds the duration of the
reverse repurchase agreement. A reverse repurchase agreement may not be entered
into for the Fund if, as a result, more than one-third of the market value of
the Fund's total assets, less liabilities other than the obligations created by
reverse repurchase agreements, would be engaged in reverse repurchase
agreements. In the event that such agreements exceed, in the aggregate,
one-third of such market value, the amount of the Fund's obligations created by
reverse repurchase agreements will be reduced within three days thereafter (not
including weekends and holidays) or such longer period as the Securities and
Exchange Commission may prescribe, to an extent that such obligations will not
exceed, in the aggregate, one-third of the market value of the Fund's assets, as
defined above. A segregated account with the Custodian is established and
maintained for the Fund with liquid assets in an amount at least equal to the
Fund's purchase obligations under its reverse repurchase agreements. Such
segregated account consists of liquid assets marked to the market daily, with
additional liquid assets added when necessary to insure that at all times the
value of such account is equal to the purchase obligations.
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<PAGE>
APPENDIX B--HEDGING STRATEGIES
================================================================================
Options on Stock Indexes (U.S. Equity Fund only). A stock index fluctuates
with changes in the market values of the stocks included in the index. Examples
of stock indexes are the Standard & Poor's 500 Stock Index (Chicago Board of
Options Exchange) and the New York Stock Exchange Composite Index (New York
Stock Exchange).
Options on stock indexes are generally similar to options on stock except
that the delivery requirements are different. Instead of giving the right to
take or make delivery of stock at a fixed price ("strike price"), an option on a
stock index gives the holder the right to receive a cash "exercise settlement
amount" equal to (a) the amount, if any, by which the strike price of the option
exceeds (in the case of a put) or is less than (in the case of a call) the
closing value of the underlying index on the date of exercise, multiplied by (b)
a fixed "index multiplier". Receipt of this cash amount will depend upon the
closing level of the stock index upon which the option is based being greater
than, in the case of a call, or less than, in the case of a put, the price of
the option. The amount of cash received will be equal to such difference between
the closing price of the index and the strike price of the option times a
specified multiple.
The effectiveness of purchasing stock index options as a hedging technique
depends upon the extent to which price movements in the portion of the
securities portfolio of the U.S. Equity Fund being hedged correlate with price
movements of the stock index selected. The value of an index option depends upon
future movements in the level of the overall stock market measured by the
underlying index before the expiration of the option. Accordingly, the
successful use of options on stock indexes for the U.S. Equity Fund is subject
to the Investment Adviser's ability both to select an appropriate index and to
predict future price movements over the short term in the overall stock market.
Brokerage costs are incurred in the purchase of stock index options and the
incorrect choice of an index or an incorrect assessment of future price
movements may result in poorer overall performance than if a stock index option
had not been purchased.
Options on Fixed Income Securities (Short/Intermediate Fixed Income Fund
only). A call option on fixed income securities gives the purchaser of the
option the right to buy the underlying securities at a fixed price at any time
during the option period. Similarly, a put option gives the purchaser of the
option the right to sell the underlying securities at a fixed price at any time
during the option period. To liquidate a put or call option position, a "closing
sale transaction" may be made at any time prior to the expiration of the option
which involves selling the option previously purchased.
The effectiveness of purchasing options on fixed income securities as a
hedging technique depends upon the extent to which price movements in the
portion of the securities portfolio of the Short/Intermediate Fixed Income Fund
being hedged correlate with price movements of the fixed income securities
selected. The value of these options depends upon future movements in the level
of interest rates as reflected in the price of the underlying fixed income
securities before the expiration of the option. Accordingly, the successful use
of options on fixed income securities for the Short/Intermediate Fixed Income
Fund is subject to the Investment Adviser's ability to select appropriate
underlying fixed income securities and to predict future interest rate movements
over the short term in the overall market. Brokerage costs are incurred in the
purchase of options on fixed income securities and the incorrect choice of
underlying fixed income securities or an incorrect assessment of future interest
rate movements may result in poorer overall performance than if such an option
had not been purchased.
The Corporation intends to write (sell) "covered" put and call options on
optionable fixed income securities on behalf of the Short/Intermediate Fixed
Income Fund. Call options written by the Corporation give the holder the right
to buy the underlying securities during the term of the option at a stated
24
<PAGE>
exercise price; put options give the holder the right to sell the underlying
security to the Short/Intermediate Fixed Income Fund during the term of the
option at a stated exercise price. Call options are "covered", for example, when
the Short/Intermediate Fixed Income Fund owns the underlying securities, and put
options are "covered", for example, when the Short/Intermediate Fixed Income
Fund has established a segregated account of cash and U.S. Government securities
which can be liquidated promptly to satisfy any obligation to purchase the
underlying securities. The Corporation may also write straddles (combinations of
puts and calls on the same underlying security) on behalf of the
Short/Intermediate Fixed Income Fund.
The Short/Intermediate Fixed Income Fund receives a premium from writing a
put or call option, which increases the Short/Intermediate Fixed Income Fund's
gross income in the event the option expires unexercised or is closed out at a
profit. The amount of the premium reflects, among other things, the relationship
of the market price of the underlying security to the exercise price of the
option and the remaining term of the option. By writing a call option, the
Corporation limits the opportunity of the Short/Intermediate Fixed Income Fund
to profit from any increase in the market value of the underlying security above
the exercise price of the option. By writing a put option, the Corporation
assumes the risk that it may be required to purchase the underlying security for
an exercise price higher than its then current market value, resulting in a
potential capital loss unless the security subsequently appreciates in value.
The Corporation may terminate an option that it has written prior to its
expiration by entering into a closing purchase transaction in which it purchases
an option having the same terms as the option written. It is possible, however,
that illiquidity in the options markets may make it difficult from time to time
for the Corporation to close out its written option positions. Also, the
securities exchanges have established limitations on the number of options which
may be written by an investor or group of investors acting in concert. It is not
contemplated that these position limits will have any adverse impact on the
Corporation's portfolio strategies.
25
<PAGE>
The 59 Wall Street Fund, Inc.
Investment Adviser and
Administrator
Brown Brothers Harriman & Co.
59 Wall Street
New York, New York 10005
Distributor
59 Wall Street Distributors, Inc.
6 St. James Avenue
Boston, Massachusetts 02116
Shareholder Servicing Agent
Brown Brothers Harriman & Co.
59 Wall Street
New York, New York 10005
(800) 625-5759
No dealer, salesman or any other person has been authorized to give any
information or to make any representations, other than those contained in this
Prospectus and the Statement of Additional Information, in connection with the
offer contained in this Prospectus, and if given or made, such other information
or representations must not be relied upon as having been authorized by the
Corporation or the Distributor. This Prospectus does not constitute an offer by
the Corporation or by the Distributor to sell or the solicitation of an offer to
buy any of the securities offered hereby in any jurisdiction to any person to
whom it is unlawful for the Corporation or the Distributor to make such offer in
such jurisdiction.
[LOGO]
U.S. Equity Fund
Short/Intermediate Fixed
Income Fund
PROSPECTUS
February 28, 1996
<PAGE>
================================================================================
STATEMENT OF ADDITIONAL INFORMATION
THE 59 WALL STREET U.S. EQUITY FUND
THE 59 WALL STREET SHORT/INTERMEDIATE FIXED INCOME FUND
6 ST. JAMES AVENUE, BOSTON, MASSACHUSETTS 02116
================================================================================
The 59 Wall Street U.S. Equity Fund (the "U.S. Equity Fund") and The 59
Wall Street Short/Intermediate Fixed Income Fund (the "Short/Intermediate Fixed
Income Fund") (each a "Fund" and collectively the "Funds") are separate
portfolios of The 59 Wall Street Fund, Inc. (the "Corporation"), a management
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"). The U.S. Equity Fund is designed to enable investors
to be invested in a portfolio of equity securities of companies that are well
established and financially sound. The U.S. Equity Fund's investment objective
is to provide investors with long-term capital growth while also generating
current income. The Short/Intermediate Fixed Income Fund is designed to enable
investors to be invested in a portfolio of high quality fixed-income securities
having an average weighted maturity of not more than four years. The
Short/Intermediate Fixed Income Fund's investment objective is to provide
investors with a high level of current income consistent with minimizing price
fluctuations in net asset value and maintaining liquidity. There can be no
assurance that either Fund's investment objective will be achieved.
Brown Brothers Harriman & Co. is each Fund's investment adviser (the
"Investment Adviser"). This Statement of Additional Information is not a
prospectus and should be read in conjunction with the Prospectus dated February
28, 1996, a copy of which may be obtained from the Corporation at the address
noted above.
TABLE OF CONTENTS
CROSS-REFERENCE TO
PAGE PAGE IN PROSPECTUS
Investment Objective and Policies . . . . . . . . . 2 5-9
Investment Restrictions . . . . . . . . . . . . . . 5 9
<PAGE>
Directors and Officers . . . . . . . . . . . . . . . 8 12
Investment Adviser . . . . . . . . . . . . . . . . . 11 12-13
Administrator . . . . . . . . . . . . . . . . . . . 12 13-14
Distributor . . . . . . . . . . . . . . . . . . . . 13 15-16
Net Asset Value; Redemption in Kind . . . . . . . . 13 16
Computation of Performance . . . . . . . . . . . . . 14 19
Federal Taxes . . . . . . . . . . . . . . . . . . . 15 17-18
Description of Shares . . . . . . . . . . . . . . . 17 18
Portfolio Transactions . . . . . . . . . . . . . . . 19 8-9
Corporate Bond, Commercial Paper and Note Ratings . 21 20-23
Additional Information . . . . . . . . . . . . . . . 22 19
Financial Statements . . . . . . . . . . . . . . . . 23 4
THE DATE OF THIS STATEMENT OF ADDITIONAL INFORMATION IS FEBRUARY 28, 1996.
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INVESTMENT OBJECTIVE AND POLICIES
================================================================================
The following supplements the information contained in the Prospectus
concerning the investment objective, policies and techniques of each Fund.
EQUITY INVESTMENTS
Equity investments may or may not pay dividends and may or may not
carry voting rights. Common stock occupies the most junior position in a
company's capital structure. Convertible securities entitle the holder to
exchange the securities for a specified number of shares of common stock,
usually of the same company, at specified prices within a certain period of time
and to receive interest or dividends until the holder elects to convert. The
provisions of any convertible security determine its ranking in a company's
capital structure. In the case of subordinated convertible debentures, the
holder's claims on assets and earnings are subordinated to the claims of other
creditors, and are senior to the claims of preferred and common shareholders. In
the case of convertible preferred stock, the holder's claims on assets and
earnings are subordinated to the claims of all creditors and are senior to the
claims of common shareholders.
FUTURES AND OPTIONS CONTRACTS
OPTIONS ON STOCK. For the sole purpose of reducing risk, put and call
options on stocks may be purchased for the U.S. Equity Fund, although the
current intention is not to do so in such a manner that more than 5% of the
Fund's net assets would be at risk. A call option on a stock gives the purchaser
of the option the right to buy the underlying stock at a fixed price at any time
during the option period. Similarly, a put option gives the purchaser of the
option the right to sell the underlying stock at a fixed price at any time
during the option period. To liquidate a put or call option position, a "closing
sale transaction" may be made for the Fund at any time prior to the expiration
of the option which involves selling the option previously purchased.
FUTURES CONTRACTS ON STOCK INDEXES AND FIXED INCOME SECURITIES. For the
sole purpose of reducing risk, futures contracts on fixed income securities
("interest rate Futures Contracts") may be entered into for the
Short/Intermediate Fixed Income Fund and futures contracts on stock indexes may
be entered into for the U.S. Equity Fund (collectively, "Futures Contracts"),
although the current intention is not to do so in such a manner that more than
5% of a Fund's net assets would be at risk.
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<PAGE>
In order to assure that a Fund it not deemed a "commodity pool" for
purposes of the Commodity Exchange Act, regulations of the Commodity Futures
Trading Commission ("CFTC") require that each Fund enter into transactions in
futures contracts and options on futures contracts only (i) for bona fide
hedging purposes (as defined in CFTC regulations), or (ii) for non-hedging
purposes, provided that the aggregate initial margin and premiums on such
non-hedging positions does not exceed 5% of the liquidation value of the Fund's
assets.
Futures Contracts are used to hedge against anticipated future changes
in interest rates or overall stock market prices which otherwise might either
adversely affect the value of securities held for a Fund or adversely affect the
prices of securities which are intended to be purchased at a later date for a
Fund. A Futures Contract may also be entered into to close out or offset an
existing futures position.
In general, each transaction in Futures Contracts involves the
establishment of a position which is expected to move in a direction opposite to
that of the investment being hedged. If these hedging transactions are
successful, the futures positions taken for a Fund would rise in value by an
amount which approximately offsets the decline in value of the portion of that
Fund's investments that is being hedged. Should general market prices move in an
unexpected manner, the full anticipated benefits of Futures Contracts may not be
achieved or a loss may be realized. There is also the risk of a potential lack
of liquidity in the secondary market.
The effectiveness of entering into Futures Contracts as a hedging
technique depends upon the extent to which price movements in the portion of the
securities portfolio of a Fund being hedged correlate with price movements of
the fixed income securities or stock index selected. The value of a Futures
Contract depends upon future movements in the price of the fixed income
securities or in the level of the overall stock market measured by the
underlying index before the closing out of the Futures Contract. Accordingly,
the successful use of Futures Contracts for a Fund is subject to the Investment
Adviser's ability both to select appropriate fixed income securities or an
appropriate index and to predict future price movements over the short term in
those securities or in the overall stock market. The incorrect choice of fixed
income securities or an index or an incorrect assessment of future price
movements over the short term in those securities or in the overall stock market
may result in poorer overall performance than if a Futures Contract had not been
purchased. Brokerage costs are incurred in entering into and maintaining Futures
Contracts.
When a Fund enters into a Futures Contract, it is initially required to
deposit with that Fund's custodian, in a segregated account in the name of the
broker performing the transaction, an
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<PAGE>
"initial margin" of cash, U.S. Government securities or other high grade
short-term obligations equal to approximately 3% of the contract amount. Initial
margin requirements are established by the exchanges on which Futures Contracts
trade and may, from time to time, change. In addition, brokers may establish
margin deposit requirements in excess of those required by the exchanges.
Initial margin in futures transactions is different from margin in securities
transactions in that initial margin does not involve the borrowing of funds by a
broker's client but is, rather, a good faith deposit on the Futures Contract
which will be returned upon the proper termination of the Futures Contract. The
margin deposits made are marked to market daily and a Fund may be required to
make subsequent deposits of cash or eligible securities called "variation
margin", with that Fund's futures contract clearing broker, which are reflective
of price fluctuations in the Futures Contract.
Currently, interest rate Futures Contracts can be purchased on debt
securities such as U.S. Treasury bills and bonds, U.S. Treasury notes with
maturities between 6 1/2 to 10 years, GNMA certificates and bank certificates of
deposit. As a purchaser of an interest rate Futures Contract, a Fund incurs an
obligation to take delivery of a specified amount of the obligation underlying
the contract at a specified time in the future for a specified price. As a
seller of an interest rate Futures Contract, a Fund incurs an obligation to
deliver the specified amount of the underlying obligation at a specified time in
return for an agreed upon price.
Currently, Futures Contracts can be purchased on stock indexes such as
the Standard & Poor's 500 Stock Index (Chicago Board of Options Exchange) and
the New York Stock Exchange Composite Index (New York Stock Exchange). Unlike
interest rate Futures Contracts, Futures Contracts on stock indexes which may be
entered into provide for the making and acceptance of a cash settlement based
upon changes in the value of an index of stocks.
Exchanges may limit the amount by which the price of a Futures Contract
may move on any day. If the price moves equal the daily limit on successive
days, then it may prove impossible to liquidate a futures position until the
daily limit moves have ceased.
Another risk which may arise in employing Futures Contracts to protect
against the price volatility of portfolio securities is that the prices of
securities or an index subject to Futures Contracts (and thereby the Futures
Contract prices) may correlate imperfectly with the behavior of the cash prices
of a Fund's portfolio securities. Another such risk is that the price of the
Futures Contract may not move in tandem with the change in prevailing interest
rates or overall stock market prices against which the Fund seeks a hedge. An
interest rate correlation may be distorted by the fact that the futures market
is dominated by short-term traders seeking to profit from the difference between
4
<PAGE>
a contract or security price objective and their cost of borrowed funds. Such
distortions are generally minor and would diminish as the contract approached
maturity.
LOANS OF PORTFOLIO SECURITIES
Securities of a Fund may be loaned if such loans are secured
continuously by cash or equivalent collateral or by an irrevocable letter of
credit in favor of that Fund at least equal at all times to 100% of the market
value of the securities loaned plus accrued income. While such securities are on
loan, the borrower pays a Fund any income accruing thereon, and cash collateral
may be invested for that Fund, thereby earning additional income. All or any
portion of interest earned on invested collateral may be paid to the borrower.
Loans are subject to termination by the Corporation in the normal settlement
time, currently three business days after notice, or by the borrower on one
day's notice. Borrowed securities are returned when the loan is terminated. Any
appreciation or depreciation in the market price of the borrowed securities
which occurs during the term of the loan inures to the Fund and its
shareholders. Reasonable finders' and custodial fees may be paid in connection
with a loan. In addition, all facts and circumstances, including the
creditworthiness of the borrowing financial institution, are considered before a
loan is made and no loan is made in excess of one year. There is the risk that a
borrowed security may not be returned to a Fund. Securities of a Fund are not
loaned to Brown Brothers Harriman & Co. or to any affiliate of the Corporation
or Brown Brothers Harriman & Co.
INVESTMENT RESTRICTIONS
================================================================================
Each Fund is operated under the following investment restrictions which
are deemed fundamental policies and may be changed only with the approval of the
holders of a "majority of that Fund's outstanding voting securities as defined
in the 1940 Act". (See "Additional Information".)
Except that the Corporation may invest all of each Fund's assets in an
open-end investment company with substantially the same investment objective,
policies and restrictions as the Fund, the Corporation, with respect to the
Fund, may not:
(1) borrow money or mortgage or hypothecate its assets, except that in
an amount not to exceed 1/3 of the current value of its net assets, it may
borrow money as a temporary measure for extraordinary or emergency purposes, and
except that it may pledge, mortgage or hypothecate not more than 1/3 of such
assets to secure such borrowings (it is intended that money will be borrowed
only from banks and only either to accommodate requests
5
<PAGE>
for the redemption of Fund shares 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) or, for the Short/Intermediate Fixed Income Fund only, reverse
repurchase agreements, 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 "State and Federal Restrictions";
(2) purchase any security or evidence of interest therein on margin,
except that such short-term credit as may be necessary for the clearance of
purchases and sales of securities may be obtained and except that deposits of
initial deposit and variation margin may be made in connection with the
purchase, ownership, holding or sale of futures or the purchase, ownership,
holding, sale or writing of options;
(3) underwrite securities issued by other persons except insofar as it
may technically be deemed an underwriter under the Securities Act of 1933 in
selling a portfolio security;
(4) make loans to other persons except (a) through the lending of its
portfolio securities and provided that any such loans not exceed 30% of its net
assets (taken at market value), (b) through the use of repurchase agreements or
the purchase of short-term obligations and provided that not more than 10% of
its net assets is invested in repurchase agreements maturing in more than seven
days, or (c) by purchasing, subject to the limitation in paragraph (5) below, a
portion of an issue of debt securities of types commonly distributed privately
to financial institutions, for which purposes the purchase of short-term
commercial paper or a portion of an issue of debt securities which is part of an
issue to the public shall not be considered the making of a loan;
(5) knowingly invest in securities which are subject to legal or
contractual restrictions on resale (other than repurchase agreements maturing in
not more than seven days) if, as a result thereof, more than 10% of its net
assets (taken at market value) would be so invested (including repurchase
agreements maturing in more than seven days);
(6) with respect to the Short/Intermediate Fixed Income Fund, enter
into reverse repurchase agreements which, including any borrowings described in
paragraph (1), exceed, in the aggregate, one-third of the market value of the
Fund's total assets, less liabilities other than obligations created by reverse
repurchase agreements. In the event that such agreements exceed, in the
aggregate, one-third of such market value, it
6
<PAGE>
will, within three days thereafter (not including weekends and holidays) or such
longer period as the Securities and Exchange Commission may prescribe, reduce
the amount of the obligations created by reverse repurchase agreements to an
extent that such obligations will not exceed, in the aggregate, one-third of the
market value of its assets;
(7) 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 (the
freedom of action to hold and to sell real estate acquired as a result of the
ownership of securities is reserved);
(8) make short sales of securities or maintain a short position, unless
at all times when a short position is open it owns an equal amount of such
securities or securities convertible into or exchangeable, without payment of
any further consideration, for securities of the same issue as, and equal in
amount to, the securities sold short, and unless not more than 10% of its net
assets (taken at market value) is represented by such securities, or securities
convertible into or exchangeable for such securities, at any one time (it is the
present intention of management to make such sales only for the purpose of
deferring realization of gain or loss for federal income tax purposes; such
sales would not be made of securities subject to outstanding options);
(9) concentrate its investments in any particular industry, but if it
is deemed appropriate for the achievement of its investment objective, up to 25%
of its assets, at market value at the time of each investment, may be invested
in any one industry, except that positions in futures or option contracts shall
not be subject to this restriction;
(10) 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;
(11) invest more than 5% of its total assets in the securities or
obligations of any one issuer (other than obligations issued by the U.S.
Government, its agencies or instrumentalities); provided, however, that up to
25% of its total assets may be invested without regard to this restriction;
(12) with respect to the Short/Intermediate Fixed Income Fund, purchase
more than 10% of all outstanding debt obligations of any one issuer (other than
obligations issued by the U.S. Government, its agencies or instrumentalities);
or
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<PAGE>
(13) with respect to the U.S. Equity Fund, purchase more than 10% of
the outstanding voting securities of any one issuer.
STATE AND FEDERAL RESTRICTIONS. In order to comply with certain state
and federal statutes and policies the Corporation, on behalf of each Fund, may
not as a matter of operating policy (except that the Corporation may invest all
of each Fund's assets in an open-end investment company with substantially the
same investment objective, policies and restrictions as the Fund): (i) borrow
money for any purpose in excess of 10% of its total assets (taken at cost)
(moreover, securities are not purchased at any time at which the amount of its
borrowings exceeds 5% of its total assets (taken at market value)), (ii) pledge,
mortgage or hypothecate for any purpose in excess of 10% of its net assets
(taken at market value), 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, (iii)
sell any security which it does not own unless by virtue of its ownership of
other securities it has at the time of sale a right to obtain securities,
without payment of further consideration, equivalent in kind and amount to the
securities sold and provided that if such right is conditional the sale would be
made upon the same conditions, (iv) invest for the purpose of exercising control
or management, (v) purchase securities issued by any investment company except
by purchase in the open market where no commission or profit to a sponsor or
dealer results from such purchase other than the customary broker's commission,
or except when such purchase, though not made in the open market, is part of a
plan of merger or consolidation; provided, however, that securities of any
investment company are not purchased if such purchase at the time thereof would
cause more than 10% of its total assets (taken at the greater of cost or market
value) to be invested in the securities of such issuers or would cause more than
3% of the outstanding voting securities of any such issuer to be held for it,
(vi) invest more than 10% of its net assets (taken at the greater of cost or
market value) in restricted securities ; invest more than 15% of its net assets
in over-the-counter options, time deposits with a maturity of more than seven
days, repurchase agreements, securities of foreign issuers which are not
registered under the Securities Act of 1933 and other securities that are
illiquid or otherwise not readily marketable, (vii) purchase securities of any
issuer if such purchase at the time thereof would cause it to hold more than 10%
of any class of securities of such issuer, for which purposes all indebtedness
of an issuer is deemed a single class and all preferred stock of an issuer is
deemed a single class, except that futures and option contracts are not subject
to this restriction, (viii) invest more than 5% of its assets in companies
which, including predecessors, have a record of less than three years of
continuous operation (this restriction shall not apply to any obligations of the
U.S. Government, its agencies or instrumentalities), or (ix) purchase or retain
in its portfolio any securities issued by an issuer any of whose
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<PAGE>
officers, directors, trustees or security holders is an officer or Director of
the Corporation, or is an officer or partner of the Investment Adviser, if after
the purchase of the securities of such issuer one or more of such persons owns
beneficially more than 1/2 of 1% of the shares or securities, or both, all taken
at market value, of such issuer, and such persons owning more than 1/2 of 1% of
such shares or securities together own beneficially more than 5% of such shares
or securities, or both, all taken at market value. These policies are not
fundamental and may be changed without shareholder approval in response to
changes in the various state and federal requirements.
PERCENTAGE AND RATING RESTRICTIONS. If a percentage or rating
restriction on investment or utilization of assets set forth above or referred
to in the Prospectus is adhered to at the time an investment is made or assets
are so utilized, a later change in percentage resulting from changes in the
value of the portfolio securities or a later change in the rating of a portfolio
security is not considered a violation of policy.
DIRECTORS AND OFFICERS
================================================================================
The Directors and executive officers of the Corporation, their
principal occupations during the past five years (although their titles may have
varied during the period) and business address are:
DIRECTORS OF THE CORPORATION
J.V. SHIELDS, JR.* --
Chairman of the Board and
Director; Trustee of The 59 Wall Street Trust (since September 1990); Managing
Director, Chairman and Chief Executive Officer of Shields & Company; Chairman
and Chief Executive Officer of Capital Management Associates, Inc.; Director of
Flowers Industries, Inc.(1) His business address is Shields & Company, 71
Broadway, New York, NY 10006.
EUGENE P. BEARD** -- Director; Trustee of The 59 Wall Street Trust
(since April 1993); Executive Vice President - Finance and Operations of The
Interpublic Group of Companies
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. His business address is The Interpublic Group of Companies, Inc., 1271 Avenue
of the Americas, New York, NY 10020.
DAVID P. FELDMAN** -- Director; Trustee of The 59 Wall Street Trust
(since September 1990); Corporate Vice President Investment Management of
American Telephone and Telegraph Co., Inc.; Director of Dreyfus Mutual Funds,
Equity Fund of Latin America (since prior to April 1990), New World Balanced
Fund (since prior to May 1990), India Magnum Fund (since prior to September
1990), and U.S. Prime Properties Inc. (since February 1990); Trustee of
Corporate Property Investors. His business address is American Telephone and
Telegraph Co., Inc., One Oak Way, Room 2EA 176, Berkeley Heights, NJ 07922.
ALAN G. LOWY** --
Director; Trustee of The 59 Wall Street Trust (since April 1993); Private
investor; Secretary of the Los Angeles County Board of Investments (prior to
March 1995). His business address is 4111 Clear Valley Drive, Encino, CA 91436.
ARTHUR D. MILTENBERGER** -- Director; Trustee of The 59 Wall Street
Trust (since February 1992); Vice President and Chief Financial Officer of
Richard K. Mellon and Sons; Treasurer of Richard King Mellon Foundation;
Director of Enterprise Corporation (prior to 1992), Vought Aircraft Corporation
(prior to September 1994), Caterair International (prior to April 1994),
Computer Renaissance, Inc. (prior to March 1990), and I&M Orchards, Inc. (prior
to 1991); Member of Valuation Committee of T. Rowe Price Threshold Fund, L.P.
(prior to 1992), Advisory Committee of Carlyle Group and Pittsburgh Seed Fund
and Valuation Committee of Morgenthaler Venture Funds(2). His business address
is Richard K. Mellon and Sons, P.O. Box RKM, Ligonier, PA 15658.
OFFICERS OF THE CORPORATION
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<PAGE>
PHILIP W. COOLIDGE -- President; Chief Executive Officer and President
of Signature Financial Group, Inc. ("SFG"), 59 Wall Street Distributors, Inc.
("59 Wall Street Distributors") (since June 1990) and 59 Wall Street
Administrators, Inc. ("59 Wall Street Administrators") (since June 1993).
JAMES E. HOOLAHAN -- Vice President; Senior Vice President of SFG
(since prior to December 1990).
JOHN R. ELDER -- Treasurer; Vice President of SFG (since April 1995);
Treasurer of Phoenix Family of Mutual Funds (prior to April 1995).
THOMAS M. LENZ -- Secretary; Senior Vice President and Associate
General Counsel of SFG (since prior to November 1990); Assistant Secretary of 59
Wall Street Distributors (since May 1991) and 59 Wall Street Administrators
(since June 1993).
BARBARA M. O'DETTE -- Assistant Treasurer; Assistant Treasurer of SFG,
59 Wall Street Distributors (since June 1990) and 59 Wall Street Administrators
(since June 1993) .
DAVID G. DANIELSON --
Assistant
Treasurer; Assistant Manager of SFG (since May 1991); Graduate Student,
Northeastern University (prior to March 1991).
BRIAN J. HALL -- Assistant Treasurer; Senior Fund Administrator of SFG
(since November 1991); Senior State Regulation Administrator of The Boston
Company (prior to November 1991).
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<PAGE>
MOLLY S. MUGLER -- Assistant Secretary; Legal Counsel and Assistant
Secretary of SFG; Assistant Secretary of 59 Wall Street Distributors (since June
1990) and 59 Wall Street Administrators (since June 1993).
- -------------------------
* Mr. Shields is an "interested person" of the Corporation
because of his affiliation with a registered broker-dealer.
** These Directors are members of the Audit Committee of the
Corporation.
(1) Shields & Company, Capital Management Associates, Inc. and
Flowers Industries, Inc., with which Mr. Shields is
associated, are a registered broker-dealer and a member of
the New York Stock Exchange, a registered investment
adviser, and a diversified food company, respectively.
(2) Richard K. Mellon and Sons, Richard King Mellon Foundation,
Enterprise Corporation, Vought Aircraft Corporation,
Caterair International, The Carlyle Group and Morgenthaler
Venture Funds, with which Mr. Miltenberger is or has been
associated, are a private foundation, a private foundation,
a business development firm, an aircraft manufacturer, an
airline food services company, a merchant bank, and a
venture capital partnership, respectively.
Each Director and officer listed above holds the equivalent position
with The 59 Wall Street Trust. The address of each officer is 6 St. James
Avenue, Boston, Massachusetts 02116. Messrs. Coolidge, Hoolahan, Elder, Lenz,
Danielson and Hall and Mss. Mugler and O'Dette also hold similar positions with
other investment companies for which affiliates of 59 Wall Street Distributors
serve as the principal underwriter.
Except for Mr. Shields, no Director is an "interested person" of the
Corporation as that term is defined in the 1940 Act.
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<PAGE>
The Directors of the Corporation receive a base annual fee of $15,000 (except
the Chairman who receives a base annual fee of $20,000) which is paid jointly by
all series of the Corporation and The 59 Wall Street Trust
and allocated among the series based upon their respective net assets. In
addition, each series which has commenced operations pays an annual fee to each
Director of $1,000. The aggregate compensation to each Director from the
Corporation and the Fund Complex (the Fund Complex consists of the Corporation
and The 59 Wall Street Trust which currently consists of three series) was less
than $60,000.
By virtue of the responsibilities assumed by Brown Brothers Harriman &
Co. under the Investment Advisory Agreement and the Administration Agreement
(see "Investment Adviser" and "Administrator"), the Corporation itself requires
no employees other than its officers, and none of its officers devote full time
to the affairs of the Corporation or, other than the Chairman, receive any
compensation from a Fund.
As of January 31, 1996, the Corporation's Directors and officers as a
group beneficially owned less than 1% of the outstanding shares of the
Corporation. At the close of business on that date, no person, to the knowledge
of management, owned beneficially more than 5% of the outstanding shares of a
Fund except as follows: The Baird Family Trust Account owned 131,076 (12.8%)
shares of the U.S. Equity Fund. Richard Goeltz owned 100,050 shares (8.6%) of
the Short/Intermediate Fixed Income Fund. D.C. Medical Society owned 168,048
(14.5%) shares of the Short/Intermediate Fixed Income Fund. Catholic Charities
Gift owned 67,306 (5.8%) shares of the Short/Intermediate Fixed Income Fund. The
address of each of the above named is c/o Brown Brothers Harriman & Co., 59 Wall
Street,
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<PAGE>
New York, New York 10005. As of that date, partners of Brown Brothers Harriman &
Co. and their immediate families owned an additional 50,280 (4.9%) and 12,918
(1.1%), respectively, of the U.S. Equity Fund and the Short/Intermediate Fixed
Income Fund. Brown Brothers Harriman & Co. and its affiliates separately are
able to direct the disposition of an additional 279,330 (27.4%) and 193,724
(16.7%), respectively, of the U.S. Equity Fund and the Short/Intermediate Fixed
Income Fund, as to which shares Brown Brothers Harriman & Co. disclaims
beneficial ownership.
INVESTMENT ADVISER
================================================================================
Under its Investment Advisory Agreements with the Corporation, subject
to the general supervision of the Corporation's Directors and in conformance
with the stated policies of each Fund, Brown Brothers Harriman & Co. provides
investment advice and portfolio management services to each Fund.
In this regard, it is the responsibility of Brown Brothers Harriman & Co. to
make the day-to-day investment decisions for each Fund, to place the purchase
and sale orders for the portfolio transactions of each Fund and to manage,
generally, each Fund's investments.
Each Investment Advisory Agreement between Brown Brothers Harriman &
Co. and the Corporation with respect to each Fund is dated June 9, 1992, as
amended and restated November 1, 1993. Each agreement remains in effect for two
years from its date and thereafter, but only so long as each such agreement is
specifically approved at least annually (i) by a vote of the holders of a
"majority of that Fund's outstanding voting securities as defined in the 1940
Act" or by the Corporation's Directors, and (ii) by a vote of a majority of the
Directors of the Corporation who are not parties to that Investment Advisory
Agreement or "interested persons" (as defined in the 1940 Act) of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval. Each Investment Advisory Agreement was most recently approved by
the Independent Directors on August 22, 1995. Each Investment Advisory Agreement
terminates automatically if assigned and is terminable with respect to a Fund at
any time without penalty by a vote of a majority of the Directors of the
Corporation or by a vote of the holders of a "majority of that Fund's
outstanding voting securities as defined in the 1940 Act" on 60 days' written
notice to Brown Brothers Harriman & Co. and by Brown Brothers Harriman & Co. on
90 days' written notice to the Corporation. (See "Additional Information".)
With respect to the U.S. Equity Fund, the investment
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<PAGE>
advisory fee paid to the Investment Adviser is calculated daily and paid monthly
at an annual rate equal to 0.65% of that Fund's average daily net assets. Prior
to November 1, 1993, the investment advisory fee was at an annual rate equal to
0.85% of the Fund's average daily net assets. For the fiscal years ended October
31, 1993 , October 31, 1994 and October 31, 1995, respectively, the Fund
incurred $52,457, $107,493 and $167,339, respectively, for advisory services.
With respect to the Short/Intermediate Fixed Income Fund, the
investment advisory fee paid to the Investment Adviser is calculated daily and
paid monthly at an annual rate equal to 0.40% of that Fund's average daily net
assets. Prior to November 1, 1993, the investment advisory fee was at an annual
rate equal to 0.65% of the Fund's average daily net assets. For the fiscal years
ended October 31, 1993 , October 31, 1994 and October 31, 1995, the Fund
incurred $56,546, $40,169 and $40,190, respectively, for advisory services.
The Glass-Steagall Act prohibits certain financial institutions from
engaging in the business of underwriting, selling or distributing securities and
from sponsoring, organizing or controlling a registered open-end investment
company continuously engaged in the issuance of its shares, such as the Funds.
There is presently no controlling precedent prohibiting financial institutions
such as Brown Brothers Harriman & Co. from performing investment advisory,
administrative or shareholder servicing/eligible institution functions. If Brown
Brothers Harriman & Co. were to terminate its Investment Advisory Agreement with
the Corporation or were prohibited from acting in such capacity, it is expected
that the Directors would recommend to the shareholders that they approve a new
investment advisory agreement for each Fund with another qualified adviser. If
Brown Brothers Harriman & Co. were to terminate its Eligible Institution
Agreement or Administration Agreement with the Corporation or were prohibited
from acting in any such capacity, its customers would be permitted to remain
shareholders of the Corporation and alternative means for providing shareholder
services or administrative services, as the case may be, would be sought. In
such event, although the operation of the Corporation might change, it is not
expected that any shareholders would suffer any adverse financial consequences.
However, an alternative means of providing shareholder services might afford
less convenience to shareholders.
ADMINISTRATOR
15
<PAGE>
================================================================================
The Administration Agreement between the Corporation and Brown Brothers
Harriman & Co. (dated November 1, 1993) will remain in effect for two years from
such date and thereafter, but only so long as such agreement is specifically
approved at least annually in the same manner as the Investment Advisory
Agreements. (See "Investment Adviser".) The Independent Directors most recently
approved the Corporation's Administration Agreement on August 22, 1995. The
agreement will terminate automatically if assigned by either party thereto and
is terminable with respect to each Fund at any time without penalty by a vote of
a majority of the Directors of the Corporation or by a vote of the holders of a
"majority of the Corporation's outstanding voting securities as defined in the
1940 Act". (See "Additional Information".) The Administration Agreement is
terminable by the Corporation's Directors or shareholders of the Corporation on
60 days' written notice to Brown Brothers Harriman & Co. and by Brown Brothers
Harriman & Co. on 90 days' written notice to the Corporation.
The administrative fee payable to Brown Brothers Harriman & Co. from
each Fund is calculated daily and payable monthly at an annual rate equal to
0.15% of each Fund's average daily net assets. Prior to November 1, 1993, 59
Wall Street Distributors served as administrator for the Corporation and was
paid monthly at an annual rate equal to 0.05% of each Fund's average daily net
assets. For the fiscal year ended October 31, 1993 the U.S. Equity Fund and the
Short/Intermediate Fixed Income Fund incurred $3,086 and $4,350, respectively,
for administrative services. For the fiscal year ended October 31, 1994 the U.S.
Equity Fund and the Short/Intermediate Fixed Income Fund incurred $24,806 and
$15,063, respectively, for administrative services. For the fiscal year ended
October 31, 1995 the U.S. Equity Fund and the Short/Intermediate Fixed Income
Fund incurred $38,617 and $15,071, respectively, for administrative services.
DISTRIBUTOR
================================================================================
The Distribution Agreement (dated September 5, 1990, as amended and
restated February 12, 1991) between the Corporation and 59 Wall Street
Distributors remains in effect indefinitely, but only so long as such agreement
is specifically approved at least annually in the same manner as the Investment
Advisory Agreement. (See "Investment Adviser".) The Distribution Agreement was
most recently approved by the Independent Directors of the Corporation on
February 21, 1996. The agreement terminates automatically if assigned by either
party thereto and
16
<PAGE>
is terminable with respect to each Fund at any time without penalty by a vote of
a majority of the Directors of the Corporation or by a vote of the holders of a
"majority of each Fund's outstanding voting securities as defined in the 1940
Act".
(See "Additional Information".) The Distribution Agreement is terminable with
respect to each Fund by the Corporation's Directors or shareholders of the Fund
on 60 days' written notice to 59 Wall Street Distributors. The agreement is
terminable by 59 Wall Street Distributors on 90 days' written notice to the
Corporation.
NET ASSET VALUE; REDEMPTION IN KIND
================================================================================
The net asset value of each Fund's shares is determined each day the
New York Stock Exchange is open for regular trading. (As of the date of this
Statement of Additional Information, such Exchange is open every weekday except
for the following holidays:
New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas.) This determination of net asset
value of each share of a Fund is made once during each such day as of the close
of regular trading on such Exchange by subtracting from the value of the Fund's
total assets the amount of its liabilities, and dividing the difference by the
number of shares of that Fund outstanding at the time the determination is made.
The value of investments listed on a securities exchange is based on
the last sale prices as of the close of regular trading of the New York Stock
Exchange (which is currently 4:00 p.m., New York time) or, in the absence of
recorded sales, at the average of readily available closing bid and asked prices
on such Exchange. Unlisted securities are valued at the average of the quoted
bid and asked prices in the over-the-counter market. The value of each security
for which readily available market quotations exist is based on a decision as to
the broadest and most representative market for such security.
Bonds and other fixed income securities (other than short-term
obligations but including listed issues) are valued on the basis of valuations
furnished by a pricing service, use of which has been approved by the Board of
Directors. In making such valuations, the pricing service utilizes both
dealer-supplied valuations and electronic data processing techniques which take
into account appropriate factors such as institutional-size trading in similar
groups of securities, yield, quality, coupon rate, maturity, type of issue,
trading characteristics and other market data, without exclusive reliance upon
quoted prices or exchange or over-the-counter prices, since such valuations are
believed to reflect more accurately the fair value of such securities.
17
<PAGE>
Securities or other assets for which market quotations are not readily
available are valued at fair value in accordance with procedures established by
and under the general supervision and responsibility of the Corporation's
Directors. Short-term investments which mature in 60 days or less are valued at
amortized cost if their original maturity was 60 days or less, or by amortizing
their value on the 61st day prior to maturity, if their original maturity when
acquired for a Fund was more than 60 days, unless this is determined not to
represent fair value by the Directors.
Subject to the Corporation's compliance with applicable regulations,
the Corporation has reserved the right to pay the redemption price of shares of
a Fund, either totally or partially, by a distribution in kind of portfolio
securities (instead of cash). The securities so distributed would be valued at
the same amount as that assigned to them in calculating the net asset value for
the shares being sold. If a shareholder received a distribution in kind, the
shareholder could incur brokerage or other charges in converting the securities
to cash. The Corporation has elected, however, to be governed by Rule 18f-1
under the 1940 Act, as a result of which the Corporation is obligated with
respect to any one investor during any 90 day period to redeem shares of a Fund
solely in cash up to the lesser of $250,000 or 1% of that Fund's net assets at
the beginning of such 90 day period.
COMPUTATION OF PERFORMANCE
================================================================================
The average annual total return of a Fund is calculated for any period
by (a) dividing (i) the sum of the aggregate net asset value per share on the
last day of the period of shares purchased with a $1,000 payment on the first
day of the period and the aggregate net asset value per share on the last day of
the period of shares purchasable with dividends and capital gains distributions
declared during such period with respect to shares purchased on the first day of
such period and with respect to shares purchased with such dividends and capital
gains distributions, by (ii) $1,000, (b) raising the quotient to a power equal
to 1 divided by the number of years in the period, and (c) subtracting 1 from
the result.
The total rate of return of a Fund for any specified period is
calculated by (a) dividing (i) the sum of the aggregate net asset value per
share on the last day of the period of shares purchased with a $1,000 payment on
the first day of the period and the aggregate net asset value per share on the
last day of the period of shares purchasable with dividends and capital gains
distributions declared during such period with respect to shares purchased on
the first day of such period and with respect to
18
<PAGE>
shares purchased with such dividends and capital gains distributions, by (ii)
$1,000, and (b) subtracting 1 from the result.
The annualized average rate of return for the U.S. Equity Fund and the
Short/Intermediate Fixed Income Fund for the period July 23, 1992 (commencement
of operations) to October 31, 1995 was 13.92% and 4.87%, respectively. The
average annual rate of return for the U.S. Equity Fund and the
Short/Intermediate Fixed Income Fund for the fiscal year ended October 31, 1995
was 25.50% and 10.26%, respectively.
Performance calculations should not be considered a representation of
the average annual or total rate of return of a Fund in the future since the
rates of return are not fixed. Actual total rates of return and average annual
rates of return depend on changes in the market value of, and dividends and
interest received from, the investments held by a Fund and that Fund's expenses
during the period.
Total and average annual rate of return information may be useful for
reviewing the performance of a Fund and for providing a basis for comparison
with other investment alternatives. However, unlike bank deposits or other
investments which pay a fixed yield for a stated period of time, a Fund's total
rate of return fluctuates, and this should be considered when reviewing
performance or making comparisons.
Any "yield" quotation of the Short/Intermediate Fixed Income Fund
consists of an annualized historical yield, carried at least to the nearest
hundredth of one percent, based on a 30-day or one-month period and is
calculated by (a) raising to the sixth power the sum of 1 plus the quotient
obtained by dividing the Fund's net investment income earned during the period
by the product of the average daily number of shares outstanding during the
period that were entitled to receive dividends and the maximum offering price
per share on the last day of the period, (b) subtracting 1 from the result, and
(c) multiplying the result by 2.
The yield should not be considered a representation of the yield of the Fund
in the future since the yield is not fixed. Actual yields depend on the type,
quality and maturities of the investments held by the Fund, changes in interest
rates on investments, and the Fund's expenses during the period.
Yield information may be useful for reviewing the performance of the
Fund and for providing a basis for comparison with other investment
alternatives. However, unlike bank deposits or other investments which pay a
fixed yield for a stated period of time, the Fund's yield does fluctuate, and
this should be considered when reviewing performance or making comparisons.
19
<PAGE>
FEDERAL TAXES
================================================================================
Each year, the Corporation intends to continue to qualify each Fund and
elect that each Fund be treated as a separate "regulated investment company"
under Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"). Under Subchapter M of the Code a Fund is not subject to federal income
taxes on amounts distributed to shareholders.
Qualification as a regulated investment company under the Code
requires, among other things, that (a) at least 90% of a Fund's annual gross
income, without offset for losses from the sale or other disposition of
securities, be derived from interest, payments with respect to securities loans,
dividends and gains from the sale or other disposition of securities or other
income derived with respect to its business of investing in such securities; (b)
less than 30% of a Fund's annual gross income be derived from gains (without
offset for losses) from the sale or other disposition of securities held for
less than three months; and (c) the holdings of a Fund be diversified so that,
at the end of each quarter of its fiscal year, (i) at least 50% of the market
value of a Fund's assets be represented by cash, U.S. Government securities and
other securities limited in respect of any one issuer to an amount not greater
than 5% of that Fund's assets and 10% of the outstanding voting securities of
such issuer, and (ii) not more than 25% of the value of a Fund's assets be
invested in the securities of any one issuer (other than U.S. Government
securities). In addition, in order not to be subject to federal income tax, at
least 90% of a Fund's net investment income and net short-term capital gains
earned in each year must be distributed to that Fund's shareholders.
Gains or losses on sales of securities for a Fund are treated as
long-term capital gains or losses if the securities have been held by it for
more than one year except in certain cases where a put has been acquired or a
call has been written thereon for that Fund. Other gains or losses on the sale
of securities are treated as short-term capital gains or losses. Gains and
losses on the sale, lapse or other termination of options on securities are
generally treated as gains and losses from the sale of securities. If an option
written for a Fund lapses or is terminated through a closing transaction, such
as a repurchase for that Fund of the option from its holder, that Fund may
realize a short-term capital gain or loss, depending on whether the premium
income is greater or less than the amount paid in the closing transaction. If
securities are sold for a Fund pursuant to the exercise of a call option written
for it, the premium received would be added to the sale price of the securities
delivered in determining the amount of gain or loss on
20
<PAGE>
the sale. The requirement that less than 30% of a Fund's gross income be derived
from gains from the sale of securities held for less than three months may limit
the ability to write options and engage in transactions involving stock index
futures for a Fund.
Certain options contracts held for a Fund at the end of each fiscal
year are required to be "marked to market" for federal income tax purposes; that
is, treated as having been sold at market value. Sixty percent of any gain or
loss recognized on these deemed sales and on actual dispositions are treated as
long -term capital gain or loss, and the remainder are treated as short-term
capital gain or loss regardless of how long that Fund has held such options. A
Fund may be required to defer the recognition of losses on stock or securities
to the extent of any unrecognized gain on offsetting positions held for it.
RETURN OF CAPITAL. If the net asset value of shares is reduced below a
shareholder's cost as a result of a dividend or capital gains distribution by a
Fund, such dividend or capital gains distribution would be taxable even though
it represents a return of invested capital.
REDEMPTION OF SHARES. Any gain or loss realized on the redemption of
Fund shares by a shareholder who is not a dealer in securities would be treated
as long-term capital gain or loss if the shares have been held for more than one
year, and otherwise as short-term capital gain or loss. However, any loss
realized by a shareholder upon the redemption of Fund shares held one year or
less is treated as a long-term capital loss to the extent of any long-term
capital gains distributions received by the shareholder with respect to such
shares. Additionally, any loss realized on a redemption or exchange of Fund
shares is disallowed to the extent the shares disposed of are replaced within a
period of 61 days beginning 30 days before such disposition, such as pursuant to
reinvestment of a dividend or capital gains distribution in Fund shares.
OTHER TAXES. A Fund may be subject to state or local taxes in
jurisdictions in which it is deemed to be doing business. In addition, the
treatment of a Fund and its shareholders in those states which have income tax
laws might differ from treatment under the federal income tax laws. Shareholders
should consult their own tax advisors with respect to any state or local taxes.
DESCRIPTION OF SHARES
================================================================================
The Corporation is an open-end management investment company organized
as a Maryland corporation on July 16, 1990. The Articles of Incorporation
currently permit the Corporation to issue 2,500,000,000 shares of common stock,
par value
21
<PAGE>
$0.001 per share, of which 25,000,000 shares have been classified as shares of
The 59 Wall Street U.S. Equity Fund and 25,000,000 as shares of The 59 Wall
Street Short/Intermediate Fixed Income Fund. The Corporation currently consists
of six portfolios.
Shareholders are entitled to one vote for each share held on matters on
which they are entitled to vote. Shareholders in the Corporation do not have
cumulative voting rights, and shareholders owning more than 50% of the
outstanding shares of the Corporation may elect all of the Directors of the
Corporation if they choose to do so and in such event the other shareholders in
the Corporation would not be able to elect any Director. The Corporation is not
required and has no current intention to hold meetings of shareholders annually
but the Corporation will hold special meetings of shareholders when in the
judgment of the Corporation's Directors it is necessary or desirable to submit
matters for a shareholder vote. Shareholders have under certain circumstances
(E.G., upon application and submission of certain specified documents to the
Directors by a specified number of shareholders) the right to communicate with
other shareholders in connection with requesting a meeting of shareholders for
the purpose of removing one or more Directors. Shareholders also have the right
to remove one or more Directors without a meeting by a declaration in writing by
a specified number of shareholders. Shares have no preference, pre-emptive,
conversion or similar rights. Shares, when issued, are fully paid and
non-assessable.
Stock certificates are not issued by the Corporation.
The Articles of Incorporation of the Corporation contain a provision
permitted under Maryland Corporation Law which under certain circumstances
eliminates the personal liability of the Corporation's Directors to the
Corporation or its shareholders.
The Articles of Incorporation and the By-Laws of the Corporation
provide that the Corporation indemnify the Directors and officers of the
Corporation to the full extent permitted by the Maryland Corporation Law, which
permits indemnification of such persons against liabilities and expenses
incurred in connection with litigation in which they may be involved because of
their offices with the Corporation. However, nothing in the Articles of
Incorporation or the By-Laws of the Corporation protects or indemnifies a
Director or officer of the Corporation against any liability to the Corporation
or its shareholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office.
The Corporation may, in the future, seek to achieve each Fund's
investment objective by investing all of the Fund's investable assets in a
no-load, diversified, open-end management investment company having
substantially the same investment objective as those applicable to the Fund. In
such event, the
22
<PAGE>
Fund would no longer directly require investment advisory services and therefore
would pay no investment advisory fees. Further, the administrative services fee
paid from the Fund would be reduced. At a shareholder's meeting held on
September 23, 1993, each Fund's shareholders approved changes to the investment
restrictions to authorize such an investment. Such an investment would be made
only if the Directors believe that the aggregate per share expenses of each Fund
and such other investment company would be less than or approximately equal to
the expenses which the Fund would incur if the Corporation were to continue to
retain the services of an investment adviser for the Fund and the assets of the
Fund were to continue to be invested directly in portfolio securities.
It is expected that the investment in another investment company will
have no preference, preemptive, conversion or similar rights, and will be fully
paid and non-assessable. It is expected that the investment company will not be
required to hold annual meetings of investors, but will hold special meetings of
investors when, in the judgment of its trustees, it is necessary or desirable to
submit matters for an investor vote. It is expected that each investor will be
entitled to a vote in proportion to the share of its investment in such
investment company. Except as described below, whenever the Corporation is
requested to vote on matters pertaining to the investment company, the
Corporation would hold a meeting of each Fund's shareholders and would cast its
votes on each matter at a meeting of investors in the investment company
proportionately as instructed by the Fund's shareholders.
However, subject to applicable statutory and regulatory requirements,
the Corporation would not request a vote of a Fund's shareholders with respect
to any proposal relating to the investment company in which the Fund's assets
were invested, which proposal, if made with respect to the Fund, would not
require the vote of the shareholders of the Fund.
PORTFOLIO TRANSACTIONS
================================================================================
U.S. EQUITY FUND
In effecting securities transactions for this Fund, the Investment
Adviser seeks to obtain the best price and execution of orders. In selecting a
broker, the Investment Adviser considers a broker's ability to execute orders
without disturbing the market price, a broker's reliability for prompt, accurate
confirmations and on-time delivery of securities, and the quality and
reliability of brokerage services, including execution capability and
performance and financial responsibility, and may consider the research and
other investment information provided
23
<PAGE>
by such brokers. Accordingly, the commissions charged by a broker may be greater
than the amount another firm might charge if the Investment Adviser determines
in good faith that the amount of such commissions is reasonable in relation to
the value of the brokerage services and research information provided by that
broker.
For the fiscal years ended October 31, 1993 , October 31, 1994 and
October 31, 1995, the aggregate commissions paid by the U.S. Equity Fund were
$25,857 , $47,685 and $66,007, respectively.
Portfolio securities are not purchased from or sold to the
Administrator, Distributor or Investment Adviser or any "affiliated person" (as
defined in the 1940 Act) of the Administrator, Distributor or Investment Adviser
when such entities are acting as principals, except to the extent permitted by
law. The Corporation uses Brown Brothers Harriman & Co. as one of the Fund's
principal brokers where, in the judgment of the Investment Adviser, such firm is
able to obtain a price and execution at least as favorable as prices and
executions provided by other qualified brokers. As one of the Fund's principal
brokers, Brown Brothers Harriman & Co. receives brokerage commissions from that
Fund.
The use of Brown Brothers Harriman & Co. as a broker for the Fund is
subject to the provisions of Rule 11a2-2(T) under the Securities Exchange Act of
1934 which permits the Corporation to use Brown Brothers Harriman & Co. as a
broker provided that certain conditions are met.
In addition, under the 1940 Act, commissions paid by the Fund to Brown
Brothers Harriman & Co. in connection with a purchase or sale of securities
offered on a securities exchange may not exceed the usual and customary broker's
commission.
A committee of non-interested Directors from time to time reviews,
among other things, information relating to the commissions charged by Brown
Brothers Harriman & Co. to the Fund and to its other customers and information
concerning the prevailing level of commissions charged by other qualified
brokers. In addition, the procedures pursuant to which Brown Brothers Harriman &
Co. effects brokerage transactions for the Fund are reviewed and approved no
less often than annually by a majority of the non-interested Directors.
24
<PAGE>
For the fiscal year ended October 31, 1993, total transactions with a
principal value of $14,108,884 were effected for the U.S. Equity Fund of which
transactions with a principal value of $5,862,160 were effected by Brown
Brothers Harriman & Co. which involved payments of commissions to Brown Brothers
Harriman & Co. of $13,158.
For the fiscal year ended October 31, 1994, total transactions with a
principal value of $25,304,200 were effected for the U.S. Equity Fund of which
transactions with a principal value of $12,461,904 were effected by Brown
Brothers Harriman & Co. which involved payments of commissions to Brown Brothers
Harriman & Co. of $24,675.
For the fiscal year ended October 31, 1995, total transactions with a
principal value of $38,139,053 were effected for the U.S. Equity Fund of which
transactions with a principal value of $16,283,300 were effected by Brown
Brothers Harriman & Co. which involved payments of commissions to Brown Brothers
Harriman & Co. of $35,145.
A portion of the transactions for the Fund are executed through
qualified brokers other than Brown Brothers Harriman & Co. In selecting such
brokers, the Investment Adviser may consider the research and other investment
information provided by such brokers. Research services provided by brokers to
which Brown Brothers Harriman & Co. has allocated brokerage business in the past
include economic statistics and forecasting services, industry and company
analyses, portfolio strategy services, quantitative data, and consulting
services from economists and political analysts. Research services furnished by
brokers are used for the benefit of all the Investment Adviser's clients and not
solely or necessarily for the benefit of the Fund. The Investment Adviser
believes that the value of research services received is not determinable nor
does such research significantly reduce its expenses. The Corporation does not
reduce the fee paid by the Fund to the Investment Adviser by any amount that
might be attributable to the value of such services.
A committee, comprised of officers and partners of Brown Brothers
Harriman & Co. who are portfolio managers of some of Brown Brothers Harriman &
Co.'s managed accounts (the "Managed Accounts"), evaluates semi-annually the
nature and quality of the brokerage and research services provided by brokers,
and, based on this evaluation, establishes a list and projected ranking of
preferred brokers for use in determining the relative amounts of commissions to
be allocated to such brokers. However, in any semi-annual period, brokers not on
the list may be used, and the relative amounts of brokerage commissions paid to
the brokers on the list may vary substantially from the projected rankings.
The Directors of the Corporation review regularly the reasonableness of
commissions and other transaction costs incurred for the Fund in light of facts
and circumstances deemed
25
<PAGE>
relevant from time to time and, in that connection, receive reports from the
Investment Adviser and published data concerning transaction costs incurred by
institutional investors generally.
SHORT/INTERMEDIATE FIXED INCOME FUND
Brown Brothers Harriman & Co., as Investment Adviser, places orders for
all purchases and sales of portfolio securities, enters into repurchase and
reverse repurchase agreements and executes loans of portfolio securities.
Fixed-income securities are generally traded at a net price with dealers acting
as principal for their own account without a stated commission. The price of the
security usually includes a profit to the dealer. In underwritten offerings,
securities are purchased at a fixed price which includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. On occasion, certain money market instruments may be
purchased directly from an issuer, in which case no commissions or discounts are
paid. Purchases and sales of securities on a stock exchange, while infrequent,
will be effected through brokers who charge a commission for their services.
From time to time certificates of deposit may be purchased through
intermediaries who may charge a commission for their services.
MISCELLANEOUS
Over-the-counter purchases and sales are transacted directly with
principal market makers, except in those circumstances in which, in the judgment
of the Investment Adviser, better prices and execution of orders can otherwise
be obtained. If the Corporation effects a closing transaction with respect to a
futures or option contract, such transaction normally would be executed by the
same broker-dealer who executed the opening transaction. The writing of options
by the Corporation may be subject to limitations established by each of the
exchanges governing the maximum number of options in each class which may be
written by a single investor or group of investors acting in concert, regardless
of whether the options are written on the same or different exchanges or are
held or written in one or more accounts or through one or more brokers. The
number of options which the Corporation may write may be affected by options
written by the Investment Adviser for other investment advisory clients. An
exchange may order the liquidation of positions found to be in excess of these
limits, and it may impose certain other sanctions.
CORPORATE BOND, COMMERCIAL PAPER AND NOTE RATINGS
================================================================================
Bonds rated Aa and Aaa by Moody's are judged by Moody's to
26
<PAGE>
be of high quality by all standards and comprise what are generally known as
high-grade bonds. Aa bonds are rated lower than Aaa bonds because (i) margins of
protection might not be as large, or (ii) fluctuation of protective elements
might be of greater amplitude, or (iii) there might be other elements present
which make the long-term risks larger than Aaa securities. Bonds rated A are
considered as upper medium grade obligations. Principal and interest are
considered adequate, but elements may be present which suggest a susceptibility
to impairment sometime in the future. Issues rated AAA, AA or A may be further
modified by the numbers 1, 2 or 3 (3 being the highest) to show relative
strength within the rating category. Notes rated MIG-1 by Moody's are judged to
be of the best quality, enjoying strong protection from established cash flow of
funds for their services or from established and broad-based access to the
market for refinancing or both. Notes rated MIG-2 are judged to be of high
quality with ample margins of protection, though not as large as MIG-1. The
commercial paper rating Prime-1 is the highest commercial paper rating assigned
by Moody's and denotes that the issuer has superior capacity for repayment.
Among the factors considered by Moody's in assigning bond, note and commercial
paper ratings are the following: (i) evaluation of the management of the issuer;
(ii) economic evaluation of the issuer's industry or industries and an appraisal
of speculative-type risks which may be inherent in certain areas; (iii)
evaluation of the issuer's products in relation to competition and customer
acceptance; (iv) liquidity; (v) amount and quality of long-term debt; (vi) trend
of earnings over a period of 10 years; (vii) financial strength of a parent
company and the relationships which exist with the issuer; and (viii)
recognition by management of obligations which may be present or may arise as a
result of public interest questions and preparations to meet such obligations.
Bonds rated AAA are considered by Standard & Poor's to be the highest
grade obligations and have the greatest degree of protection as to principal and
interest. Bonds rated AA by Standard & Poor's are judged by Standard & Poor's to
be high grade obligations and in the majority of instances differ only in small
degree from issues rated AAA. With AA bonds as with AAA bonds prices move with
the long-term money market. Bonds rated A have a strong capacity to pay
principal and interest, although they are somewhat susceptible to the adverse
effects or changes in circumstances and economic conditions. Bonds rated AA or A
may be modified with a plus (+) or a minus (-) sign to show relative strength
within the rating category. With respect to notes, an SP-1 rating indicates a
very strong or strong capacity to pay principal and interest. Issues determined
to possess overwhelming safety characteristics are given a plus (+) designation.
SP-2 denotes a satisfactory capacity to pay principal and interest. The
commercial paper rating A-1 is the highest paper rating assigned by Standard &
Poor's and indicates a strong degree of safety regarding timely payments. Issues
determined to possess overwhelming safety characteristics are
27
<PAGE>
given a plus (+) designation. Among the factors considered by Standard & Poor's
in assigning bond, note and commercial paper ratings are the following: (i)
trend of earnings and cash flow with allowances made for unusual circumstances,
(ii) stability of the issuer's industry, (iii) the issuer's relative strength
and position within the industry and (iv) the reliability and quality of
management.
ADDITIONAL INFORMATION
================================================================================
As used in this Statement of Additional Information and the Prospectus,
the term "majority of a Fund's outstanding voting securities as defined in the
1940 Act" currently means the vote of (i) 67% or more of that Fund's shares
present at a meeting, if the holders of more than 50% of the outstanding voting
securities of that Fund are present in person or represented by proxy; or (ii)
more than 50% of that Fund's outstanding voting securities, whichever is less.
Fund shareholders receive semi-annual reports containing unaudited
financial statements and annual reports containing financial statements audited
by independent auditors.
A shareholder's right to receive payment with respect to any redemption
may be suspended or the payment of the redemption proceeds postponed: (i) during
periods when the New York Stock Exchange is closed for other than weekends and
holidays or when regular trading on such Exchange is restricted as determined by
the Securities and Exchange Commission by rule or regulation, (ii) during
periods in which an emergency exists which causes disposal of, or evaluation of
the net asset value of, a Fund's portfolio securities to be unreasonable or
impracticable, or (iii) for such other periods as the Securities and Exchange
Commission may permit.
With respect to the securities offered by the Prospectus, this
Statement of Additional Information and the Prospectus do not contain all the
information included in the Registration Statement filed with the Securities and
Exchange Commission under the Securities Act of 1933. Pursuant to the rules and
regulations of the Securities and Exchange Commission, certain portions have
been omitted. The Registration Statement including the exhibits filed therewith
may be examined at the office of the Securities and Exchange Commission in
Washington, D.C.
Statements contained in this Statement of Additional Information and
the Prospectus concerning the contents of any contract or other document are not
necessarily complete, and in each instance, reference is made to the copy of
such contract or other document filed as an exhibit to the Registration
Statement.
28
<PAGE>
Each such statement is qualified in all respects by such reference.
FINANCIAL STATEMENTS
================================================================================
The Annual Report of the Funds dated October 31, 1995 has been filed
with the Securities and Exchange Commission pursuant to Section 30(b) of the
1940 Act and Rule 30b2-1 thereunder and is hereby incorporated herein by
reference. A copy of the Annual Report will be provided, without charge, to each
person receiving this Statement of Additional Information.
WS5129C
29
<PAGE>
WS5231B
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial Statements:
Financial Statements included in the Prospectus constituting
Part A of this Registration Statement:
For each of The 59 Wall Street U.S. Equity Fund and The 59
Wall Street Short/Intermediate Fixed Income Fund:
Financial Highlights for the period July 23, 1992
(commencement of operations) to October 31, 1992 and
the fiscal years ended October 31, 1993 , October 31,
1994 and October 31, 1995.
Financial Statements included in the Statement of Additional
Information constituting Part B of this Registration Statement:
For each of The 59 Wall Street U.S. Equity Fund and The 59
Wall Street Short/Intermediate Fixed Income Fund:
Portfolio of Investments at October 31, 1995.
Statement of Assets and Liabilities at October 31, 1995.
Statement of Operations for the fiscal year ended
October 31, 1995.
Statement of Changes in Net Assets for the fiscal years
ended October 31, 1994 and October 31, 1995.
Financial Highlights for the period July 23, 1992
(commencement of operations) to October 31, 1992 and the
fiscal years ended October 31, 1993, October 31, 1994 and
October 31, 1995.
Notes to Financial Statements.
Independent Auditors' Report
Management's Discussion of Fund Performance
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(b) Exhibits:
1 -- (a) Restated Articles of Incorporation of the Registrant.(7)
-- (b) Designation of Series of The 59 Wall Street U.S. Equity
Fund and The 59 Wall Street Short/Intermediate Fixed
Income Fund.(7)
-- (c) Designation of Series of The 59 Wall Street
Small Company Fund.(7)
-- (d) Designation of Series of The 59 Wall Street
International Equity Fund.(7)
-- (e) Designation of Series of The 59 Wall Street
Short Term Fund. (7)
2 -- Amended and Restated By-Laws of the Registrant.(7)
3 -- Not Applicable.
4 -- Not Applicable.
5 -- (a) Advisory Agreement with respect to The 59 Wall Street
U.S. Equity Fund.(7)
(b) Advisory Agreement with respect to The 59 Wall Street
Short/Intermediate Fixed Income Fund.(7)
6 -- Form of Amended and Restated Distribution Agreement.(3)
7 -- Not Applicable.
8 -- (a) Form of Custody Agreement.(2)
(b) Form of Transfer Agency Agreement.(2)
9 -- (a) Amended and Restated Administration Agreement.(6)
(b) Subadministrative Services Agreement.(6)
(c) Form of License Agreement.(1)
(d) Amended and Restated Shareholder Servicing Agreement.(6)
(e) Amended and Restated Eligible Institution Agreement.(6)
(f) Form of Expense Reimbursement Agreement with respect to
The 59 Wall Street U.S. Equity Fund.(6)
(g) Form of Expense Reimbursement Agreement with respect to
The 59 Wall Street Short/Intermediate Fixed Income
Fund.(6)
10 -- Opinion of Counsel (including consent).(2)
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11 -- Independent auditors' consent.(7)
12 -- Not Applicable.
13 -- Copies of investment representation letters from initial
shareholders.(2)
14 -- Not Applicable.
15 -- Not Applicable.
16 -- Schedule for Computation of Performance Quotations.(5)
17 -- Financial Data Schedule.(7)
(1)Filed with the initial Registration Statement on July 16, 1990.
(2)Filed with Amendment No. 1 to this Registration Statement on October 9, 1990.
(3)Filed with Amendment No.2 to this Registration Statement on February 14,
1991.
(4)Filed with Amendment No. 5 to this Registration Statement on June 15, 1992.
(5)Filed with Amendment No. 7 to this Registration Statement on March 1, 1993.
(6)Filed with Amendment No.9 to this Registration Statementon December 30, 1993.
(7)Filed herewith.
Item 25. Persons Controlled by or Under Common Control with Registrant.
See "Directors and Officers" in the Statement of Additional Information
filed as part of this Registration Statement.
Item 26. Number of Holders of Securities.
Title of Class Number of Record Holders
Common Stock (as of
January 31, 1996)
The 59 Wall Street Small Company Fund 439
The 59 Wall Street European Equity Fund 1,236
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The 59 Wall Street Pacific Basin Equity Fund 1,335
The 59 Wall Street Short/Intermediate Fixed Income Fund 116
The 59 Wall Street U.S. Equity Fund 345
The 59 Wall Street International Equity Fund 0
Item 27. Indemnification
Reference is made to Article VII of Registrant's By-Laws and to Section
5 of the Distribution Agreement between the Registrant and 59 Wall Street
Distributors, Inc.
Registrant, its Directors and officers, and persons affiliated with
them are insured against certain expenses in connection with the defense of
actions, suits or proceedings, and certain liabilities that might be imposed as
a result of such actions, suits or proceedings.
Insofar as indemnification for liability arising under the Securities
Act of 1933, as amended (the "Act"), may be permitted to Directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a Director, officer of controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such Director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
Item 28. Business and Other Connections of Investment Adviser.
The Registrant's investment adviser, Brown Brothers Harriman & Co.
("BBH & Co."), is a New York limited partnership. BBH & Co. conducts a general
banking business and is a member of the New York Stock Exchange, Inc.
To the knowledge of the Registrant, none of the general partners or
officers of BBH & Co. is engaged in any other business, profession, vocation or
employment of a substantial nature.
Item 29. Principal Underwriters.
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1. (a) 59 Wall Street Distributors, Inc. ("59 Wall Street
Distributors") and its affiliates, also serves as
administrator and/or distributor to other
registered investment companies.
(b) Set forth below are the names, principal business
addresses and positions of each Director and
officer of 59 Wall Street Distributors. The
principal business address of these individuals is
c/o 59 Wall Street Distributors, Inc., 6 St. James
Avenue, Boston, MA 02116. Unless otherwise
specified, no officer or Director of 59 Wall
Street Distributors serves as an officer or
Director of the Registrant.
Position and Offices with Position and Offices
Name 59 Wall Street Distributors with the Registrant
- ------------- --------------------------- --------------------
Philip W. Coolidge Chief Executive President
Officer, President
and Director
John R. Elder Assistant Treasurer Treasurer
Linda T. Gibson Assistant Secretary --
Thomas M. Lenz Assistant Secretary Secretary
Molly S. Mugler Assistant Secretary Assistant Secretary
Andres E. Saldana Assistant Secretary --
Linwood C. Downs Treasurer --
Barbara M. O'Dette Assistant Treasurer Assistant Treasurer
David G. Danielson -- Assistant Treasurer
Brian J. Hall -- Assistant Treasurer
Robert Davidoff Director --
CMNY Capital, L.P.
135 East 57th Street
New York, NY 10022
Donald Chadwick Director --
Scarborough & Company
110 East 42nd Street
New York, NY 10017
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Leeds Hackett Director --
National Credit
Management Corporation
10155 York Road
Cockeysville, MD 21030
Laurence E. Levine Director --
First International
Capital Ltd.
130 Sunrise Avenue
Palm Beach, FL 33480
(c) Not Applicable.
Item 30. Location of Accounts and Records.
All accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder are
maintained at the offices of:
The 59 Wall Street Fund, Inc.
6 St. James Avenue
Boston, MA 02116
Brown Brothers Harriman & Co.
59 Wall Street
New York, NY 10005
(investment adviser, eligible institution
and shareholder servicing agent)
59 Wall Street Distributors, Inc.
6 St. James Avenue
Boston, MA 02116
(distributor)
59 Wall Street Administrators, Inc.
6 St. James Avenue
Boston, MA 02116
(subadministrator)
State Street Bank and Trust Company
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<PAGE>
1776 Heritage Drive
North Quincy, MA 02171
(custodian and transfer agent)
Item 31. Management Services.
Other than as set forth under the caption "Management of the
Corporation" in the Prospectus constituting Part A of the Registration
Statement, Registrant is not a party to any management-related service contract.
Item 32. Undertakings.
(a) The Registrant undertakes to furnish to each person to whom a
prospectus is delivered a copy of the Registrant's latest annual report to
shareholders upon request and without charge.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all the
requirements for effectiveness of this Post-Effective Amendment to its
Registration Statement on Form N1-A ("Registration Statement") pursuant to Rule
485(b) under the Securities Act of 1933 and 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 New York and State of New York on the
21st day of February, 1996.
THE 59 WALL STREET FUND, INC.
By /s/ PHILIP W. COOLIDGE
(Philip W. Coolidge, President)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated above.
Signature Title
/s/ J.V. SHIELDS, JR. Director and Chairman of
(J.V. Shields, Jr.) the Board
/s/ PHILIP W. COOLIDGE President (Principal
(Philip W. Coolidge) Executive Officer)
/s/ EUGENE P. BEARD Director
(Eugene P. Beard)
/s/ DAVID P. FELDMAN Director
(David P. Feldman)
/s/ ARTHUR D. MILTENBERGER Director
(Arthur D. Miltenberger)
/s/ ALAN D. LOWY Director
(Alan D. Lowy)
/S/ JOHN R. ELDER Treasurer
(John R. Elder)
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INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
1.(a) Restated Articles of Incorporation of the Registrant
1.(b) Designation of Series of The 59 Wall Street U.S. Equity Fund
and The 59 Wall Street Short/Intermediate Fixed Income
Fund.
(c) Designation of Series of The 59 Wall Street
Small Company Fund.
(d) Designation of Series of The 59 Wall Street
International Equity Fund.
(e) Designation of Series of The 59 Wall Street
Short Term Fund.
2. Amended and Restated By-Laws of the Registrant.
5.(a) Advisory Agreement with respect to The 59 Wall Street U.S.
Equity Fund.
5.(b) Advisory Agreement with respect to The 59 Wall Street
Short/Intermediate Fixed Income Fund.
11. Consent of Deloitte & Touche LLP
17. Financial Data Schedules
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THE 59 WALL STREET FUND, INC.
ARTICLES OF INCORPORATION
DATED JULY 16, 1990
<PAGE>
THE 59 WALL STREET FUND, INC.
ARTICLES OF RESTATEMENT (Under Section 2-609 of Corporations and
Associations Article)
The 59 Wall Street Fund, Inc., a Maryland corporation having its
principal office in the City of Baltimore Maryland and having The Corporation
Trust Incorporated as its resident agent located at 32 South Street, Baltimore,
Maryland, (hereinafter called the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland, that:
FIRST: The charter of the Corporation is hereby restated to
read as follows:
SECOND: The name of the Corporation is The 59 Wall Street
Fund, Inc.
THIRD: The purpose for which the Corporation is formed is to
act as an open-end management investment company under the Investment
Company Act of 1940 as may be amended from time to time and the Rules
and Regulations from time to time promulgated and effective thereunder
(referred to herein collectively as the "Investment Company Act of
1940") and to exercise and enjoy all of the powers, rights and
privileges granted to, or conferred upon, corporations by the General
Laws of the State of Maryland now or hereafter in force.
FOURTH: The post office address of the principal office of the
Corporation in the State of Maryland is c/o The Corporation Trust
Incorporated, 32 South Street, Baltimore, Maryland 21202. The name of
the resident agent of the Corporation in the State of Maryland is The
Corporation Trust Incorporated, a corporation of this State, and the
post office address of the resident agent is 32 South Street,
Baltimore, Maryland 21202.
FIFTH: 1. The total number of shares of stock which the
Corporation initially shall have authority to issue is 2,500,000,000
shares
<PAGE>
2
of stock, with a par value of one-tenth of one cent ($.001) per share
to be known and designated as Common Stock, such shares of Common Stock
having an aggregate par value of two million five hundred thousand
dollars ($2,500,000). The Board of Directors shall have power and
authority to increase or decrease, from time to time, the aggregate
number of shares of stock, or of any class of stock, which the
Corporation shall have the authority to issue.
2. Subject to the provisions of these Articles of
Incorporation, the Board of Directors shall have the power to issue
shares of Common Stock of the Corporation from time to time, at prices
not less than the net asset value or par value thereof, whichever is
greater, for such consideration as may be fixed from time to time
pursuant to the direction of the Board of Directors. All stock shall be
issued on a nonassessable basis.
3. Pursuant to Section 2-105 of the Maryland General
Corporation Law, the Board of Directors of the Corporation shall have
the power to designate one or more classes of shares of Common Stock,
to fix the number of shares in any such class and to classify or
reclassify any unissued shares with respect to such class. Any such
class shall be known as a "series" and (subject to any applicable rule,
regulation or order of the Securities and Exchange Commission or other
applicable law or regulation) shall have such preferences, conversion
or other rights, voting powers, restrictions, limitations as to
dividends, qualifications, terms and conditions of redemption and other
characteristics as the Board may determine in the absence of contrary
determination set forth herein. The aforesaid power shall include the
power to create, by classifying or reclassifying unissued shares in the
aforesaid manner, one or more series in addition to those initially
designated as named below. Subject to such aforesaid power, the Board
of Directors has initially designated two series of shares of Common
Stock of the Corporation. The names of such series and the number of
shares of Common Stock initially classified and allocated to each
series is as follows:
Number of Shares of Common Stock
NAME OF SERIES INITIALLY CLASSIFIED AND ALLOCATED
The 59 Wall Street European Equity Fund . . . . . . . 25,000,000
The 59 Wall Street Pacific Basin Equity Fund . . . . . 25,000,000
4. Each share of a series shall have equal rights with
each other share of that series with respect to the assets of the
Corporation pertaining to that series. The dividends payable to the
holders of any series (subject to any applicable rule, regulation or
order of the Securities and Exchange Commission or any other applicable
law or regulation) shall be determined by the Board and need not be
individually declared, but may be declared and paid in accordance with
a formula adopted by the Board (whether or not the amount of dividend
or distribution so declared can be calculated at the time of such
declaration).
5. The holder of each share of stock of the Corporation
shall be entitled to one vote for each full share, and a fractional
vote for each fractional share of stock, irrespective of the series,
then
<PAGE>
3
standing in his or her name in the books of the Corporation. On any
matter submitted to a vote of stockholders, all shares of the
Corporation then issued and outstanding and entitled to vote,
irrespective of the series, shall be voted in the aggregate and not by
series except (1) when otherwise expressly provided by the Maryland
General Corporation Law, or (2) when required by the Investment Company
Act of 1940, shares shall be voted by individual series, or (3) when
the matter does not affect any interest of a particular series, then
only stockholders of such other series whose interests may be affected
shall be entitled to vote thereon. Holders of shares of stock of the
Corporation shall not be entitled to cumulative voting in the election
of Directors or on any other matter.
6. All consideration received by the Corporation for the
issue or sale of stock of each series, together with all income,
earnings, profits and proceeds thereof, including any proceeds derived
from the sales, exchange or liquidation thereof, and any funds or
payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall belong to the series of shares of stock
with respect to which such assets, payments or funds were received by
the Corporation for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of the
Corporation. Such assets, income, earnings, profits and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation thereof and any assets derived from any reinvestment of
such proceeds, in whatever form the same may be, are herein referred to
as "assets belonging to" such series.
7. The Board of Directors may from time to time declare
and pay dividends or distributions, in stock, property or in cash, on
any or all series of stock and to the stockholders of record as of such
date as the Board of Directors may determine; provided, such dividends
or distributions on shares of any series of stock shall be paid only
out of earnings, surplus or other lawfully available assets belonging
to such series. Subject to the foregoing proviso, the amount of any
dividends or distributions and the payment thereof shall be wholly in
the discretion of the Board of Directors.
8. In the event of the liquidation or dissolution of the
Corporation, stockholders of each series shall be entitled to receive,
as a series, out of the assets of the Corporation available for
distribution to stockholders, but other than general assets, the assets
belonging to such series, and the assets so distributable to the
stockholders of any series shall be distributed among such stockholders
in proportion to the number of shares of such series held by them and
recorded on the books of the Corporation. In the event that there are
any general assets not belonging to any particular series of stock and
available for distribution, such distribution shall be made to the
holders of stock of all series in proportion to the net asset value of
the respective series determined as hereinafter provided.
9. The assets belonging to any series of stock shall be
charged with the liabilities in respect to such series, and shall also
be charged with its share of the general liabilities of the
Corporation, in proportion to the net asset value of the respective
series determined as hereinafter provided. The determination of the
Board of Directors shall
<PAGE>
4
be conclusive as to the amount of liabilities, including accrued
expenses and reserves, as to the allocation of the same as to a given
series, and as to whether the same or general assets of the Corporation
are allocable to one or more series.
10. The Board of Directors may provide for a holder of
any series of stock of the Corporation to convert the shares in
question, on such basis as the Board may provide, into shares of stock
of any other series of the Corporation.
11. Subject to subsection 12 below, the net asset value
per share of the Corporation's Common Stock shall be determined by
adding the value of all securities, cash and other assets of the
Corporation pertaining to that series, subtracting the liabilities
applicable to that series, allocating any general assets and general
liabilities to that series, and dividing the net result by the number
of shares of that series outstanding. Subject to subsection 12 below,
the value of the securities, cash and other assets, and the amount and
nature of liabilities, and the allocation thereof to any particular
series, shall be determined pursuant to the direction of, or determined
pursuant to procedures or methods prescribed by or approved by the
Board of Directors in its sole discretion and shall be so determined at
the time or times prescribed or approved by the Board of Directors in
its sole discretion.
12. The net asset value per share of a series of the
Corporation's Common Stock for the purpose of issue, redemption or
repurchase of a share shall be determined in accordance with the
Investment Company Act of 1940 and any other applicable federal
securities law or rule or regulation.
13. All shares now or hereafter authorized shall be
subject to redemption and redeemable at the option of the stockholder,
in the sense used in the General Corporation Law of the State of
Maryland. Each holder of a share, upon request to the Corporation
accompanied by such evidence of ownership as may be specified by the
Board of Directors, shall be entitled to require the Corporation to
redeem all or any part of the shares standing in the name of such
holder on the books of the Corporation at a redemption price per share
equal to the net asset value per share determined in accordance with
this Article.
14. Notwithstanding subsection 13 above (or any other
provision of these Articles of Incorporation), the Board of Directors
of the Corporation may suspend the right of the holders of shares to
require the Corporation to redeem such shares (or may suspend any
voluntary purchase of such shares pursuant to the provisions of these
Articles of Incorporation) for up to seven days and for such other
periods as the Investment Company Act of 1940 may permit.
15. The Board of Directors may by resolution from time to
time authorize the repurchase by the Corporation, either directly or
through an agent, of shares upon such terms and conditions and for such
consideration as the Board of Directors shall deem advisable, out of
funds legally available therefor, at prices per share not in excess of
the net
<PAGE>
5
asset value per share determined in accordance with this Article and to
take all other steps deemed necessary or advisable in connection
therewith.
16. Except as otherwise permitted by the Investment
Company Act of 1940, payment of the redemption or repurchase price of
shares surrendered to the Corporation for redemption pursuant to the
provisions of subsection 13 or 18 of this Article or for repurchase by
the Corporation pursuant to the provisions of subsection 15 of this
Article shall be made by the Corporation within seven days after
surrender of such shares to the Corporation for such purpose. Any such
payment may be made in whole or in part in portfolio securities or in
cash, as the Board of Directors shall deem advisable, and no
stockholder shall have the right, other than as determined by the Board
of Directors, to have his shares redeemed or repurchased in portfolio
securities.
17. In the absence of any specifications as to the
purposes for which shares are redeemed or repurchased by the
Corporation, all shares so redeemed or repurchased shall be deemed to
be acquired for retirement in the sense contemplated by the General
Corporation Law of the State of Maryland. Shares retired by redemption
or repurchase shall thereafter have the status of authorized but
unissued shares.
18. All shares now or hereafter authorized shall be
subject to redemption and redeemable at the option of the Corporation.
The Board of Directors may by resolution from time to time authorize
the Corporation to require the redemption of all or any part of any
outstanding shares, without the vote or consent of stockholders
(including through the establishment of uniform standards with respect
to the minimum net asset value of a stockholder account), upon the
sending of written notice thereof to each stockholder any of whose
shares are so redeemed and upon such terms and conditions as the Board
of Directors shall deem advisable, out of funds legally available
therefor, at net asset value per share determined in accordance with
the provisions of this Article and to take all other steps deemed
necessary or advisable in connection therewith. The Board of Directors
may authorize the closing of those accounts not meeting the specified
minimum standards of net asset value by redeeming all of the shares in
such accounts.
19. The holders of shares of Common Stock or other
securities of the Corporation shall have no preemptive rights to
subscribe to new or additional shares of its Common Stock or other
securities.
SIXTH: The number of Directors of the Corporation shall
initially be five. The number of Directors may be increased or
decreased in accordance with the By-laws so long as the number is never
less than three. The names of the initial Directors who shall act until
the first annual meeting or until their successors are duly chosen and
qualified are: Philip W. Coolidge, Cynthia J. Colitti, James E.
Hoolahan, Gail E. McHugh and Molly S. Mugler.
SEVENTH: 1. A Director or officer of the Corporation shall not
be liable to the Corporation or its stockholders for monetary damages
for breach of fiduciary duty as a Director or officer, except to the
extent such exemption from liability or limitation thereof is not
permitted by
<PAGE>
6
law (including the Investment Company Act of 1940) as currently in
effect or as the same may hereafter be amended.
No amendment, modification or repeal of this Section 1 shall
adversely affect any right or protection of a Director or officer that
exists at the time of such amendment, modification or repeal.
2. The Corporation shall indemnify to the fullest extent
permitted by law (including the Investment Company Act of 1940) as
currently in effect or as the same may hereafter be amended any person
made or threatened to be made a party to any action, suit or
proceeding, whether criminal, civil, administrative or investigative,
by reason of the fact that such person or such person's testator or
intestate is or was a Director or officer of the Corporation or serves
or served at the request of the Corporation any other enterprise as a
director or officer. To the fullest extent permitted by law (including
the Investment Company Act of 1940) as currently in effect or as the
same may hereafter be amended, expenses incurred by any such person in
defending any such action, suit or proceeding shall be paid or
reimbursed by the Corporation promptly upon receipt by it of an
undertaking of such person to repay such expenses if it is ultimately
determined that such person is not entitled to be indemnified by the
Corporation. The rights provided to any person by this Section 2 shall
be enforceable against the Corporation by such person, who shall be
presumed to have relied upon it in serving or continuing to serve as a
director or officer as provided above. No amendment of this Section 2
shall impair the right of any person arising at any time with respect
to events occurring prior to such amendment. For purpose of this
Section 2, the term "Corporation" shall include any predecessor of the
Corporation and any constituent corporation (including any constituent
of a constituent) absorbed by the Corporation in a consolidation or
merger; the term "other enterprise" shall include any corporation,
partnership, joint venture, trust or employee benefit plan; service "at
the request of the Corporation" shall include service as a Director or
officer of the Corporation which imposes duties on, or involves
services by, such Director or officer with respect to an employee
benefit plan, its participants or beneficiaries; any excise taxes
assessed on a person with respect to an employee benefit plan shall be
deemed to be indemnifiable expenses; and action by a person with
respect to any employee benefit plan which such person reasonably
believes to be in the interest of the participants and beneficiaries of
such plan shall be deemed to be action not opposed to the best
interests of the Corporation. The provisions of this Section 2 shall be
in addition to the other provisions of this Article.
3. Nothing in this Article protects, or purports to
protect, any Director or officer against any liability to the
Corporation or its security holders to which he or she would otherwise
be subject by reason of willful malfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of his or her office.
4. Each section or portion thereof of this Article shall
be deemed severable from the remainder, and the invalidity of any such
section or portion shall not affect the validity of the remainder of
this Article.
<PAGE>
7
EIGHTH: The Board of Directors shall have the management and
control of the property, business and affairs of the Corporation and is
hereby vested with all the powers possessed by the Corporation itself
so far as is not inconsistent with law or these Articles of
Incorporation. In furtherance and without limitation of the foregoing
provisions, it is expressly declared that, subject to these Articles of
Incorporation, the Board of Directors shall have power:
1. To make, alter, amend or repeal from time to time the
By-laws of the Corporation except as such power may otherwise be
limited in the By-laws.
2. To authorize the repurchase of shares in the open
market or otherwise, at prices not in excess of the net asset value of
such shares determined in accordance with Article FIFTH hereof,
provided the Corporation has assets legally available for such purpose,
and to pay for such shares in cash, securities or other assets then
held or owned by the Corporation.
3. To fix an offering price for the shares of any series
which shall yield to the Corporation not less than the par value
thereof, at which price the shares of the Common Stock of the
Corporation shall be offered for sale, and to determine from time to
time thereafter the offering price which shall yield to the Corporation
not less than the par value thereof from sales of the shares of its
Common Stock.
4. From time to time to determine whether and to what
extent and to what time and places and under what conditions and
regulations the books and accounts of the Corporation, or any of them
other than the stock ledger, shall be open to the inspection of the
stockholders, and no stockholder shall have any right to inspect any
account or book or document of the Corporation, except as conferred by
law or authorized by resolution of the Board of Directors or of the
stockholders.
5. In addition to the powers and authorities granted
herein and by statute expressly conferred upon it, the Board of
Directors is authorized to exercise all such powers and do all acts and
things as may be exercised or done by the Corporation, subject,
nevertheless, to the provisions of Maryland law, these Articles of
Incorporation and the Bylaws of the Corporation.
NINTH: The books of the Corporation may be kept (subject to
any provisions contained in applicable statutes) outside the State of
Maryland at such place or places as may be designated from time to time
by the Board of Directors or in the By-laws of the Corporation.
TENTH: The Corporation reserves the right from time to time to
amend, alter or repeal any of the provisions of these Articles of
Incorporation (including any amendment that changes the terms of any of
the outstanding shares by classification, reclassification or
otherwise), and any contract rights, as expressly set forth in these
Articles of Incorporation, of any outstanding shares, and to add or
insert any other provisions that may, under the statutes of the State
of Maryland at the time in force, be lawfully contained in articles of
incorporation, and all
<PAGE>
8
rights at any time conferred upon the stockholders of the Corporation
by these Articles of Incorporation are subject to the provisions of
this Article TENTH.
ELEVENTH: The presence in person or by proxy of the holders of
record of one-third of the shares issued and outstanding and entitled
to vote thereat shall constitute a quorum for the transaction of any
business at all meetings of the stockholders except as otherwise
provided by law or in these Articles of Incorporation.
At any meeting of stockholders of the Corporation or of any
series of the Corporation, an Eligible Institution (as that term may
from time to time be defined in the applicable then-current prospectus
of the Corporation) may vote any shares as to which such Eligible
Institution is the holder or agent of record and which are not
otherwise represented in person or by proxy at the meeting,
proportionately in accordance with the votes cast by holders of all
shares otherwise represented at the meeting in person or by proxy as to
which such Eligible Institution is the holder or agent of record. Any
shares so voted by an Eligible Institution will be deemed represented
at the meeting for all purposes, including quorum purposes.
Notwithstanding any provision of Maryland law requiring more
than a majority vote of the Common Stock, or any series thereof, in
connection with any corporate action (including, but not limited to,
the amendment of these Articles of Incorporation), unless otherwise
provided in these Articles of Incorporation or unless otherwise
required by applicable law, the Corporation may take or authorize such
action upon the favorable vote of a majority of all the votes cast at a
meeting at which a quorum was present.
TWELFTH: All persons who shall acquire shares in the
Corporation shall acquire the same subject to the provisions to these
Articles of Incorporation.
THIRTEENTH: The duration of the Corporation shall be
perpetual. The term "Articles of Incorporation" as used herein and in
the Bylaws of the Corporation shall be deemed to mean these Articles of
Incorporation as from time to time amended and restated.
SECOND: The number of directors of the corporation is five.
The names of the directors are: Philip W. Coolidge, James E. Hoolahan,
Gail E. McHugh, Cynthia J. Colitti and Molly S. Mugler.
<PAGE>
9
The board of director of the corporation, at a meeting duly convened
and held on August 30, 1990, adopted a resolution in which was set forth the
foregoing charter, declaring that the said restatement of the charter was
adopted, there being no stockholders of the Corporation.
IN WITNESS WHEREOF, The 59 Wall Street Fund, Inc. has caused these
presents to be signed in its name and on its behalf by its President, attested
by its Secretary, on September 5, 1990.
THE 59 WALL STREET FUND, INC.
(Name of Corporation)
By /S/ PHILIP W. COOLIDGE
PHILIP W. COOLIGE
President
Thomas M. Lenz, Secretary, hereby acknowledges on behalf of The 59 Wall
Street Fund, Inc. that the foregoing Articles of Restatement are the corporate
act of the Corporation and further certifies under the penalties of perjury to
the best of my knowledge, information and belief, the matters and facts set
forth in the Articles are true in all material respects.
Attest:
By /S/ THOMAS M. LENZ
Thomas M. Lenz
Secretary
<PAGE>
WS5041
THE 59 WALL STREET FUND, INC.
Establishment and
Designation of Series of Shares of
Common Stock (par value $0.001 per share)
Pursuant to Section 2-105 of the Maryland General Corporation Law and
Article Fifth, paragraph 3 of the restated charter of the Corporation (the
"Charter"), the Board of Directors of the Corporation hereby establishes and
designates two series of Shares of common stock (the "Fund") to have the
following special and relative rights:
1. The Funds shall be named "The 59 Wall Street Short/Intermediate
Fixed Income Fund" and "The 59 Wall Street U.S. Equity Fund" and the number of
shares initially classified and allocated to each Fund is 25,000,000.
2. Each Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund and The 59
Wall Street Small Company Fund. The proceeds of sales of Shares, together with
any income and gain thereon, less any diminution or expenses thereof, shall
irrevocably belong to each Fund, unless otherwise required by law.
3. Shareholders of each Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to that Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
4. At any meeting of shareholders of any Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
5. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof
5
<PAGE>
to each shareholder any of whose Shares are so redeemed and upon such terms and
conditions as the Board of Directors shall deem advisable, out of funds legally
available therefor, at net asset value per Share determined in accordance with
the provisions of the applicable then-current prospectus of each Fund and to
take all other steps deemed necessary or advisable in connection therewith. The
Board of Directors may authorize the closing of those accounts not meeting the
specified minimum standards of net asset value by redeeming all of the Shares in
such accounts.
6. Each Fund's Shareholder Servicing Agent and each Eligible
Institution (as those terms are defined in the applicable then-current
prospectus of the Fund) may establish for their respective customers an
involuntary redemption requirement. If the value of a shareholder's holdings
falls below that amount because of a redemption of Shares, the shareholder's
remaining Shares may be redeemed. If such remaining Shares are to be redeemed,
the shareholder will be notified that the value of his holdings has fallen below
that amount and be allowed 60 days to make an additional investment to enable
the shareholder to meet the minimum requirement before the redemption is
processed.
IN WITNESS WHEREOF, the undersigned Directors have executed this
instrument this 9th day of June, 1992.
Director and
/S/ J.V. SHIELDS, JR. Chairman of the Board
J.V. Shields, Jr.
/S/ H.B. ALVORD Director
H.B. Alvord
/S/ DAVID P. FELDMAN Director
David P. Feldman
/S/ ROSS JONES Director
Ross Jones
/S/ ARTHUR D. MILTENBERGER Director
Arthur D. Miltenburger
WS5041
6
<PAGE>
WS5041
THE 59 WALL STREET FUND, INC.
ARTICLES SUPPLEMENTARY TO THE CHARTER
The 59 Wall Street Fund, Inc., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
Corporation), hereby certifies to the State Department of Assessments and
Taxation of Maryland, that:
FIRST: The Board of Directors of the Corporation, by written action at
a meeting dated June 9, 1992, established and designated two series (the
"Funds") of shares of the Corporation, each consisting of twenty-five million
(25,000,000) unissued shares of the par value of $0.001 per share of the Common
Stock of the Corporation by setting the preferences, rights, voting powers,
restrictions, limitations as to dividends, qualification or terms of redemption
of, and the conversion or other rights, thereof as hereinafter set forth.
SECOND: A description of the shares so classified with the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption as set or
changed by the Board of Directors of the Corporation is as set forth in the
Charter of the Corporation; except as follows:
A. Each Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of each Fund ("Shares"). Each Share, except as provided
<PAGE>
herein, shall have the same characteristics as Shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund and The 59
Wall Street Small Company Fund. The proceeds of sales of Shares, together with
any income and gain thereon, less any diminution or expenses thereof, shall
irrevocably belong to each Fund, unless otherwise required by law.
B. Shareholders of each Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to that Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
C. At any meeting of shareholders of any Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
D. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
2
<PAGE>
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof to each shareholder any of whose Shares are so redeemed and upon such
terms and conditions as the Board of Directors shall deem advisable, out of
funds legally available therefor, at net asset value per Share determined in
accordance with the provisions of the applicable then-current prospectus of each
Fund and to take all other steps deemed necessary or advisable in connection
therewith. The Board of Directors may authorize the closing of those accounts
not meeting the specified minimum standards of net asset value by redeeming all
of the Shares in such accounts.
E. Each Fund's Shareholder Servicing Agent and each Eligible
Institution (as those terms are defined in the applicable then-current
prospectus of the Fund) may establish for their respective customers an
involuntary redemption requirement. If the value of a shareholder's holdings
falls below that amount because of a redemption of Shares, the shareholder's
remaining Shares may be redeemed. If such remaining Shares are to be redeemed,
the shareholder will be notified that the value of his holdings has fallen below
that amount and be allowed 60 days to make an additional investment to enable
the shareholder to meet the minimum requirement before the redemption is
processed.
THIRD: The Shares aforesaid have been duly classified by the Board of
Directors pursuant to authority and power contained in the Charter of the
Corporation.
3
<PAGE>
IN WITNESS WHEREOF, The 59 Wall Street Fund, Inc. has duly caused these
presents to be signed in its name and on its behalf by its President and
attested by its Secretary on June 9, 1992.
THE 59 WALL STREET FUND, INC.
By:/S/ PHILIP W. COOLIDGE
Philip W. Coolidge, President
Attest:
/S/ THOMAS M. LENZ
Thomas M. Lenz, Secretary
THE UNDERSIGNED, President of The 59 Wall Street Fund, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary to
the Charter, of which this certificate is made a part, hereby acknowledges, in
the name and on behalf of said Corporation, the foregoing Articles Supplementary
to the Charter to be the corporate act of said Corporation and further certifies
that to the best of his knowledge, information and belief, the matters and facts
set forth therein with respect to the approval thereof are true in all material
respects, under the penalties of perjury.
/S/ PHILIP W. COOLIDGE
Philip W. Coolidge
WS5041
4
<PAGE>
WS5041
THE 59 WALL STREET FUND, INC.
Establishment and
Designation of Series of Shares of
Common Stock (par value $0.001 per share)
Pursuant to Section 2-105 of the Maryland General Corporation Law and
Article Fifth, paragraph 3 of the restated charter of the Corporation (the
"Charter"), the Board of Directors of the Corporation hereby establishes and
designates a series of Shares of common stock (the "Fund") to have the following
special and relative rights:
1. The Fund shall be named "The 59 Wall Street Small Company Fund" and
the number of shares initially classified and allocated to the Fund is
25,000,000.
2. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund and The 59 Wall Street Pacific Basin Equity Fund. The
proceeds of sales of Shares, together with any income and gain thereon, less any
diminution or expenses thereof, shall irrevocably belong to the Fund, unless
otherwise required by law.
3. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
4. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
5. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof to each shareholder any of whose Shares are so redeemed and upon such
terms and conditions as the Board of Directors shall deem advisable, out of
funds legally
<PAGE>
available therefor, at net asset value per Share determined in accordance with
the provisions of the applicable then-current prospectus of the Fund and to take
all other steps deemed necessary or advisable in connection therewith. The Board
of Directors may authorize the closing of those accounts not meeting the
specified minimum standards of net asset value by redeeming all of the Shares in
such accounts.
6. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
IN WITNESS WHEREOF, the undersigned Directors have executed this
instrument this 12th day of February, 1991.
Director and
/s/ J.V. SHIELDS, JR. Chairman of the Board
J.V. Shields, Jr.
/S/ H.B. ALVORD Director
H.B. Alvord
/S/ DAVID P. FELDMAN Director
David P. Feldman
/S/ RICHARD KARL GOELTZ Director
Richard Karl Goeltz
/S/ ROSS JONES Director
Ross Jones
WS5041
<PAGE>
WS5041
THE 59 WALL STREET FUND, INC.
ARTICLES SUPPLEMENTARY TO THE CHARTER
The 59 Wall Street Fund, Inc., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
Corporation), hereby certifies to the State Department of Assessments and
Taxation of Maryland, that:
FIRST: The Board of Directors of the Corporation, by unanimous written
action without a meeting dated February 12, 1991, established and designated a
series (the "Fund") of shares of the Corporation consisting of twenty-five
million (25,000,000) unissued shares of the par value of $0.001 per share of the
Common Stock of the Corporation by setting the preferences, rights, voting
powers, restrictions, limitations as to dividends, qualification or terms of
redemption of, and the conversion or other rights, thereof as hereinafter set
forth.
SECOND: A description of the shares so classified with the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption as set or
changed by the Board of Directors of the Corporation is as set forth in the
charter of the Corporation; except as follows:
A. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
<PAGE>
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund and The 59 Wall Street Pacific Basin Equity Fund. The
proceeds of sales of Shares, together with any income and gain thereon, less any
diminution or expenses thereof, shall irrevocably belong to the Fund, unless
otherwise required by law.
B. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
C. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
D. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
2
<PAGE>
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof to each shareholder any of whose Shares are so redeemed and upon such
terms and conditions as the Board of Directors shall deem advisable, out of
funds legally available therefor, at net asset value per Share determined in
accordance with the provisions of the applicable then-current prospectus of the
Fund and to take all other steps deemed necessary or advisable in connection
therewith. The Board of Directors may authorize the closing of those accounts
not meeting the specified minimum standards of net asset value by redeeming all
of the Shares in such accounts.
E. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
THIRD: The shares aforesaid have been duly classified by the Board of
Directors pursuant to authority and power contained in the charter of the
Corporation.
3
<PAGE>
IN WITNESS WHEREOF, The 59 Wall Street Fund, Inc. has duly caused these
presents to be signed in its name and on its behalf by its President and
attested by its Secretary on February 22, 1991.
THE 59 WALL STREET FUND, INC.
By:/S/ PHILIP W. COOLIDGE
Philip W. Coolidge, President
Attest:
/S/ THOMAS M. LENZ
Thomas M. Lenz, Secretary
THE UNDERSIGNED, President of The 59 Wall Street Fund, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary to
the Charter, of which this certificate is made a part, hereby acknowledges, in
the name and on behalf of said Corporation, the foregoing Articles Supplementary
to the Charter to be the corporate act of said Corporation and further certifies
that to the best of his knowledge, information and belief, the matters and facts
set forth therein with respect to the approval thereof are true in all material
respects, under the penalties of perjury.
/S/ PHILIP W. COOLIDGE
Philip W. Coolidge
4
<PAGE>
WS5041A
THE 59 WALL STREET FUND, INC.
Establishment and
Designation of Series of Shares of
Common Stock (par value $0.001 per share)
Pursuant to Section 2-105 of the Maryland General Corporation Law and
Article Fifth, paragraph 3 of the restated charter of the Corporation (the
"Charter"), the Board of Directors of the Corporation hereby establishes and
designates a series of Shares of common stock (the "Fund") to have the following
special and relative rights:
1. The Fund shall be named "The 59 Wall Street International Equity
Fund" and the number of shares initially classified and allocated to the Fund is
25,000,000.
2. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund, The 59 Wall
Street Small Company Fund, The 59 Wall Street Short/Intermediate Fixed Income
Fund and The 59 Wall Street U.S. Equity Fund. The proceeds of sales of Shares,
together with any income and gain thereon, less any diminution or expenses
thereof, shall irrevocably belong to the Fund, unless otherwise required by law.
3. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
4. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
5. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof to each shareholder any of whose Shares are so redeemed and upon such
terms and
<PAGE>
conditions as the Board of Directors shall deem advisable, out of funds legally
available therefor, at net asset value per Share determined in accordance with
the provisions of the applicable then-current prospectus of the Fund and to take
all other steps deemed necessary or advisable in connection therewith. The Board
of Directors may authorize the closing of those accounts not meeting the
specified minimum standards of net asset value by redeeming all of the Shares in
such accounts.
6. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
IN WITNESS WHEREOF, the undersigned Directors have executed this
instrument this 23rd day of August, 1994.
Director and
/S/ J.V. SHIELDS, JR. Chairman of the Board
J.V. Shields, Jr.
/S/ H.B. ALVORD Director
H.B. Alvord
/S/ DAVID P. FELDMAN Director
David P. Feldman
/S/ ARTHUR D. MILTENBERGER Director
Arthur D. Miltenberger
/S/ EUGENE P. BEARD Director
Eugene P. Beard
/S/ ALAN G. LOWY Director
Alan G. Lowy
WS5041A
<PAGE>
WS5041A
THE 59 WALL STREET FUND, INC.
ARTICLES SUPPLEMENTARY TO THE CHARTER
The 59 Wall Street Fund, Inc., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
Corporation), hereby certifies to the State Department of Assessments and
Taxation of Maryland, that:
FIRST: The Board of Directors of the Corporation, by unanimous written
action without a meeting dated August 23, 1994, established and designated a
series (the "Fund") of shares of the Corporation consisting of twenty-five
million (25,000,000) unissued shares of the par value of $0.001 per share of the
Common Stock of the Corporation by setting the preferences, rights, voting
powers, restrictions, limitations as to dividends, qualification or terms of
redemption of, and the conversion or other rights, thereof as hereinafter set
forth.
SECOND: A description of the shares so classified with the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption as set or
changed by the Board of Directors of the Corporation is as set forth in the
charter of the Corporation; except as follows:
A. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
<PAGE>
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund, The 59 Wall
Street Small Company Fund, The 59 Wall Street Short/Intermediate Fixed Income
Fund and The 59 Wall Street U.S. Equity Fund. The proceeds of sales of Shares,
together with any income and gain thereon, less any diminution or expenses
thereof, shall irrevocably belong to the Fund, unless otherwise required by law.
B. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
C. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
D. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part
2
<PAGE>
of any outstanding Shares, without the vote or consent of shareholders
(including through the establishment of uniform standards with respect to the
minimum net asset value of a shareholder account), upon the sending of written
notice thereof to each shareholder any of whose Shares are so redeemed and upon
such terms and conditions as the Board of Directors shall deem advisable, out of
funds legally available therefor, at net asset value per Share determined in
accordance with the provisions of the applicable then-current prospectus of the
Fund and to take all other steps deemed necessary or advisable in connection
therewith. The Board of Directors may authorize the closing of those accounts
not meeting the specified minimum standards of net asset value by redeeming all
of the Shares in such accounts.
E. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
THIRD: The shares aforesaid have been duly classified by the Board of
Directors pursuant to authority and power contained in the charter of the
Corporation.
3
<PAGE>
IN WITNESS WHEREOF, The 59 Wall Street Fund, Inc. has duly caused these
presents to be signed in its name and on its behalf by its President and
attested by its Secretary on August 23, 1994.
THE 59 WALL STREET FUND, INC.
By:/S/ PHILIP W. COOLIDGE
Philip W. Coolidge, President
Attest:
/S/ THOMAS M. LENZ
Thomas M. Lenz, Secretary
THE UNDERSIGNED, President of The 59 Wall Street Fund, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary to
the Charter, of which this certificate is made a part, hereby acknowledges, in
the name and on behalf of said Corporation, the foregoing Articles Supplementary
to the Charter to be the corporate act of said Corporation and further certifies
that to the best of his knowledge, information and belief, the matters and facts
set forth therein with respect to the approval thereof are true in all material
respects, under the penalties of perjury.
/S/ PHILIP W. COOLIDGE
Philip W. Coolidge
4
<PAGE>
WS5041B
THE 59 WALL STREET FUND, INC.
Establishment and
Designation of Series of Shares of
Common Stock (par value $0.001 per share)
Pursuant to Section 2-105 of the Maryland General Corporation Law and
Article Fifth, paragraph 3 of the restated charter of the Corporation (the
"Charter"), the Board of Directors of the Corporation hereby establishes and
designates a series of Shares of common stock (the "Fund") to have the following
special and relative rights:
1. The Fund shall be named "The 59 Wall Street Short Term Fund" and the
number of shares initially classified and allocated to the Fund is 25,000,000.
2. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund, The 59 Wall
Street Small Company Fund, The 59 Wall Street Short/Intermediate Fixed Income
Fund, The 59 Wall Street U.S. Equity Fund and The 59 Wall Street International
Equity Fund. The proceeds of sales of Shares, together with any income and gain
thereon, less any diminution or expenses thereof, shall irrevocably belong to
the Fund, unless otherwise required by law.
3. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
4. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
5. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time to
time authorize the Corporation to require the redemption of all or any part of
any outstanding Shares, without the vote or consent of shareholders (including
through the establishment of uniform standards with respect to the minimum net
asset value of a shareholder account), upon the sending of written notice
thereof to each shareholder any of whose Shares are so redeemed and upon such
terms and
<PAGE>
conditions as the Board of Directors shall deem advisable, out of funds legally
available therefor, at net asset value per Share determined in accordance with
the provisions of the applicable then-current prospectus of the Fund and to take
all other steps deemed necessary or advisable in connection therewith. The Board
of Directors may authorize the closing of those accounts not meeting the
specified minimum standards of net asset value by redeeming all of the Shares in
such accounts.
6. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
IN WITNESS WHEREOF, the undersigned Directors have executed this
instrument this 8th day of September, 1994.
Director and
/S/ J.V. SHIELDS, JR. Chairman of the Board
J.V. Shields, Jr.
/S/ DAVID P. FELDMAN Director
David P. Feldman
/S/ ARTHUR D. MILTENBERGER Director
Arthur D. Miltenberger
/S/ EUGENE P. BEARD Director
Eugene P. Beard
/S/ ALAN G. LOWY Director
Alan G. Lowy
WS5041B
<PAGE>
WS5041B
THE 59 WALL STREET FUND, INC.
ARTICLES SUPPLEMENTARY TO THE CHARTER
The 59 Wall Street Fund, Inc., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
Corporation), hereby certifies to the State Department of Assessments and
Taxation of Maryland, that:
FIRST: The Board of Directors of the Corporation, by unanimous written
action without a meeting dated September 8, 1994, established and designated a
series (the "Fund") of shares of the Corporation consisting of twenty-five
million (25,000,000) unissued shares of the par value of $0.001 per share of the
Common Stock of the Corporation by setting the preferences, rights, voting
powers, restrictions, limitations as to dividends, qualification or terms of
redemption of, and the conversion or other rights, thereof as hereinafter set
forth.
SECOND: A description of the shares so classified with the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption as set or
changed by the Board of Directors of the Corporation is as set forth in the
charter of the Corporation; except as follows:
A. The Fund shall be authorized to hold cash, invest in securities,
instruments and other properties and use investment techniques as from time to
time described in the Corporation's then currently effective registration
statement under the Securities Act of 1933 to the extent pertaining to the
offering of Shares of the Fund ("Shares"). Each Share, except as provided
<PAGE>
herein, shall have the same characteristics as shares of The 59 Wall Street
European Equity Fund, The 59 Wall Street Pacific Basin Equity Fund, The 59 Wall
Street Small Company Fund, The 59 Wall Street Short/Intermediate Fixed Income
Fund, The 59 Wall Street U.S. Equity Fund and The 59 Wall Street International
Equity Fund. The proceeds of sales of Shares, together with any income and gain
thereon, less any diminution or expenses thereof, shall irrevocably belong to
the Fund, unless otherwise required by law.
B. Shareholders of the Fund shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to have been
effectively acted upon with respect to the Fund as provided in, Rule 18f-2, as
from time to time in effect, under the Investment Company Act of 1940, as
amended, or any successor rule, and by the Charter.
C. At any meeting of shareholders of the Fund, an Eligible Institution
(as that term may from time to time be defined in the applicable then-current
prospectus of the Fund) may vote any Shares as to which such Eligible
Institution is the holder or agent of record and which are not otherwise
represented in person or by proxy at the meeting, proportionately in accordance
with the votes cast by holders of all Shares otherwise represented at the
meeting in person or by proxy as to which such Eligible Institution is the
holder or agent of record. Any Shares so voted by an Eligible Institution will
be deemed represented at the meeting for all purposes, including quorum
purposes.
D. All Shares shall be subject to redemption and redeemable at the
option of the Corporation. The Board of Directors may by resolution from time
2
<PAGE>
to time authorize the Corporation to require the redemption of all or any part
of any outstanding Shares, without the vote or consent of shareholders
(including through the establishment of uniform standards with respect to the
minimum net asset value of a shareholder account), upon the sending of written
notice thereof to each shareholder any of whose Shares are so redeemed and upon
such terms and conditions as the Board of Directors shall deem advisable, out of
funds legally available therefor, at net asset value per Share determined in
accordance with the provisions of the applicable then-current prospectus of the
Fund and to take all other steps deemed necessary or advisable in connection
therewith. The Board of Directors may authorize the closing of those accounts
not meeting the specified minimum standards of net asset value by redeeming all
of the Shares in such accounts.
E. The Fund's Shareholder Servicing Agent and each Eligible Institution
(as those terms are defined in the applicable then-current prospectus of the
Fund) may establish for their respective customers an involuntary redemption
requirement. If the value of a shareholder's holdings falls below that amount
because of a redemption of Shares, the shareholder's remaining Shares may be
redeemed. If such remaining Shares are to be redeemed, the shareholder will be
notified that the value of his holdings has fallen below that amount and be
allowed 60 days to make an additional investment to enable the shareholder to
meet the minimum requirement before the redemption is processed.
THIRD: The shares aforesaid have been duly classified by the Board of
Directors pursuant to authority and power contained in the charter of the
Corporation.
3
<PAGE>
IN WITNESS WHEREOF, The 59 Wall Street Fund, Inc. has duly caused these
presents to be signed in its name and on its behalf by its President and
attested by its Secretary on September 8, 1994.
THE 59 WALL STREET FUND, INC.
By: /S/ PHILIP W. COOLIDGE
Philip W. Coolidge, President
Attest:
/s/ THOMAS M. LENZ
Thomas M. Lenz, Secretary
THE UNDERSIGNED, President of The 59 Wall Street Fund, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary to
the Charter, of which this certificate is made a part, hereby acknowledges, in
the name and on behalf of said Corporation, the foregoing Articles Supplementary
to the Charter to be the corporate act of said Corporation and further certifies
that to the best of his knowledge, information and belief, the matters and facts
set forth therein with respect to the approval thereof are true in all material
respects, under the penalties of perjury.
/S/PHILIP W. COOLIDGE
Philip W. Coolidge
4
0049S
THE 59 WALL STREET FUND, INC.
By-Laws
July 16, 1990
As Amended and Restated on August 30, 1990
ARTICLE I
STOCKHOLDERS
Section 1. PLACE OF MEETING. All meetings of the Stockholders
shall be held at such place within the United States as may from time to time be
designated by the Board of Directors and stated in the notice of such meeting.
Section 2. MEETINGS.
(a) ANNUAL MEETINGS. The Corporation is not required to hold
an annual meeting in any year in which the election of Directors is not required
by the Investment Company Act of 1940. If the Corporation is required to hold a
meeting of Stockholders to elect Directors, such meeting shall be designated an
annual meeting and shall be held on such date no later than 120 days after the
occurrence of the event requiring the meeting and at such hour as may be
designated by the Board of Directors and stated in the notice of such meeting.
Any business of the Corporation may be considered at an annual meeting without
being specified in the notice, except as otherwise required by law.
(b) SPECIAL OR EXTRAORDINARY MEETINGS. Special or
extraordinary meetings of the Stockholders for any purpose or purposes may be
called by the Chairman or President or a majority of the Board of Directors, and
shall be called by the Secretary upon request in writing signed by Stockholders
holding not less than 25% of all the votes entitled to be cast at such meeting
provided that (i) such request shall state the purposes of such meeting and the
matters proposed to be acted on, and (ii) the Stockholders requesting such
meeting shall have paid to the Corporation the reasonably estimated cost of
preparing and mailing the notice thereof, which the Secretary shall determine
and specify to such Stockholders. No special meeting need be called upon the
request of the holders of shares entitled to cast less than a majority of all
votes entitled to be cast at such meeting to consider any matter which is
substantially the same as a matter voted upon at any special meeting of
Stockholders held during the preceding 12 months.
Section 3. NOTICE OF MEETINGS. Not less than 10 days' or more
than 90 days' written or printed notice of every meeting of Stockholders,
stating the time and place thereof (and the general nature of the business
proposed to be transacted at any special or extraordinary meeting), shall be
given by the Secretary to each Stockholder entitled to vote thereat by leaving
the same with him or at his residence or usual place of business or by mailing
it, postage
<PAGE>
2
prepaid, and addressed to him at his address as it appears upon the books of the
Corporation. If mailed, notice shall be deemed to be given when deposited in the
U.S mail addressed to the Stockholder as aforesaid.
No notice of the time, place or purpose of any meeting of
Stockholders need be given to any Stockholder who attends in person or by proxy
or to any Stockholder who executes a written waiver of such notice, either
before or after the meeting is held, and which notice is filed with the records
of the meeting.
Section 4. RECORD DATE FOR MEETINGS. The Board of Directors
may fix, in advance, a date not more than 90 days or less than 10 days preceding
the date of any meeting of Stockholders as a record date for the determination
of the Stockholders entitled to notice of and to vote at such meeting; and only
Stockholders of record on such date shall be entitled to notice of and to vote
at such meeting.
Section 5. QUORUM AND ADJOURNMENT OF MEETINGS. Except as
otherwise required by applicable law or the Articles of Incorporation, the
presence in person or by proxy of the holders of record of one third of the
shares of the Corporation issued and outstanding and entitled to vote thereat
shall constitute a quorum at all meetings of the Stockholders except that where
any provision of law or the Articles of Incorporation require that the holders
of any series of shares shall vote as a series, then the presence in person or
by proxy of the holders of record of one third of the shares of such series
issued and outstanding and entitled to vote thereat shall constitute a quorum
for the transaction of such business. If, however, such quorum shall not be
present or represented at any meeting of the Stockholders, the holders of a
majority of the shares present in person or by proxy shall have power to adjourn
the meeting from time to time, without notice other than announcement at the
meeting, until the requisite number of shares shall be present or represented to
a date not more than 120 days after the original record date. At such adjourned
meeting at which the requisite number of shares entitled to vote thereat shall
be present or represented, any business may be transacted which might have been
transacted at the meeting as originally notified.
Section 6. VOTING AND INSPECTORS. At all meetings,
Stockholders of record entitled to vote thereat shall have one vote for each
share standing in his name on the books of the Corporation (and such
Stockholders of record holding fractional shares, if any, shall have
proportionate voting rights) on the date of the determination of Stockholders
entitled to vote at such meeting, either in person or by proxy appointed by
instrument in writing subscribed by such Stockholder or his duly authorized
attorney. No proxy shall be valid 11 months after its date unless it provides
for a longer period. Pursuant to a resolution of a majority of the Directors,
proxies may be solicited in the name of one or more Directors or officers of the
Corporation.
All elections shall be had and all questions decided by a
majority of the votes cast at a duly constituted meeting, except as otherwise
provided by statute or by the Articles of Incorporation or by these By-Laws.
<PAGE>
3
At any election of Directors, the Chairman of the meeting may,
and upon the request of the holders of 10% of the shares entitled to vote at
such election shall, appoint two inspectors of election who shall first
subscribe an oath or affirmation to execute faithfully the duties of inspectors
at such election with strict impartiality and according to the best of their
ability, and shall after the election make a certificate of the result of the
vote taken. No candidate for the office of Director shall be appointed such
inspector.
Section 7. CONDUCT OF MEETINGS. The meetings of the
Stockholders shall be presided over by the Chairman, or if he is not present, by
the President, or if none of them is present, by a Chairman to be elected at the
meeting. The Secretary of the Corporation, if present, shall act as a Secretary
of such meetings, or if he is not present, an Assistant Secretary shall so act;
if neither the Secretary nor any Assistant Secretary is present, then the
meeting shall elect its Secretary.
Section 8. CONCERNING VALIDITY OF PROXIES, BALLOTS, ETC. At
every meeting of the Stockholders, all proxies shall be required and taken in
charge of and all ballots shall be required and canvassed by the Secretary of
the meeting, who shall decide all questions touching the qualification of
voters, that validity of the proxies and the acceptance or rejection of votes,
unless inspectors of election shall have been appointed by the Chairman of the
meeting, in which event such inspectors of election shall decide all such
questions.
Section 9. ACTION WITHOUT MEETING. Any action to be taken by
Stockholders may be taken without a meeting if (a) all Stockholders entitled to
vote on the matter consent to the action in writing, and (b) all Stockholders
entitled to notice of the meeting but not entitled to vote at it sign a written
waiver of any right to dissent, and (c) the written consents are filed with the
records of the meetings of Stockholders. Such consent shall be treated for all
purposes as a vote at a meeting.
ARTICLE II
DIRECTORS
Section 1. NUMBER AND TENURE OF OFFICE. The property of the
Corporation shall be controlled by and the business and affairs of the
Corporation shall be conducted and managed by not less than 3 or more than 15
Directors, as may be fixed from time to time by a written instrument signed by a
majority of the Directors then in office. Directors need not be Stockholders.
The tenure of office of each Director shall be set by resolution of the
Directors, except that any Director may resign his office or be removed from
office for cause pursuant to the provisions of the Articles of Incorporation.
Section 2. VACANCIES. Any vacancy occurring in the Board of
Directors for any cause other than by reason of an increase in the number of
Directors may be filled by the vote of a majority of the remaining Directors,
although such majority is less than a quorum. Any vacancy occurring by reason of
an increase in the number of Directors may be filled by action of a majority of
the entire Board of Directors.
<PAGE>
4
Section 3. PLACE OF MEETING. Except as required by applicable
law, the Directors may hold their meetings, have one or more offices, and keep
the books of the Corporation, outside the State of Maryland, at any office or
offices of the Corporation or at any other place as they may from time to time
by resolution determine, or in the case of meetings, as they may from time to
time by resolution determine or as shall be specified or fixed in the respective
notices or waivers of notice thereof.
Section 4. REGULAR MEETINGS. Regular meetings of the Board of
Directors shall be held at such time and on such notice as the Board of
Directors may from time to time determine.
Section 5. SPECIAL MEETINGS. Special Meetings of the Board of
Directors may be held from time to time upon call of the Chairman, the Secretary
or two or more of the Directors, by oral or telegraphic or written notice duly
served on or sent or mailed to each Director not less than one day before such
meeting. No notice of any special meeting need be given to any Director who is
present at the meeting or to any Director who executes a written waiver of such
notice, either before or after the meeting is held, and which notice is filed
with the records of the meeting. Such notice or waiver of notice need not state
the purpose or purposes of such meeting.
Section 6. QUORUM. One-third of the Directors then in office
shall constitute a quorum for the transaction of business, provided that a
quorum shall in no case be less than two Directors. If at any meeting of the
Board of Directors there shall be less than a quorum present, a majority of
those present may adjourn the meeting from time to time until a quorum shall
have been obtained. The act of the majority of the Directors present at any
meeting at which there is a quorum shall be the act of the Directors, except as
otherwise specifically provided by statute or by the Articles of Incorporation
or by these By-Laws.
Section 7. COMMITTEES. The Board of Directors, by the majority
vote of all the Directors then in office, may appoint from the Directors
committees which shall in each case consist of such number of Directors (not
less than two) and shall have and may exercise such powers as the Board of
Directors may determine in the resolution appointing them, except the power to
declare dividends or distributions on stock, issue stock unless in accordance
with a general formula or method approved by the Board of Directors, recommend
to stockholders any action requiring stockholder approval, amend the By-Laws, or
approve any merger or share exchange. A majority of all the members of any such
committee may determine its action and fix the time and place of its meetings,
unless the Board of Directors shall otherwise provide. The Board of Directors
shall have the power at any time to change the members and powers of any such
committee, to fill vacancies and to discharge any such committee.
Section 8. TELEPHONE MEETINGS. The Board of Directors or a
committee of the Board of Directors may participate in a meeting by means of a
conference telephone or similar communications equipment if all persons
participating in the meeting can hear each other at the same time. Participation
in a meeting by these means constitutes presence in person at the meeting.
<PAGE>
5
Section 9. ACTION WITHOUT A MEETING. Any action required or
permitted to be taken at any meeting of the Board of Directors or any committee
thereof may be taken without a meeting, if a written consent to such action is
signed by all the Directors then in office or all members of such committee, as
the case may be, and such written consent is filed with the minutes of the
proceedings of the Board of Directors or committee.
Section 10. COMPENSATION. The Directors shall be entitled to
receive such compensation from the Corporation for their services as may from
time to time be voted by the Board of Directors.
ARTICLE III
OFFICERS
Section 1. EXECUTIVE OFFICERS. The executive officers of the
Corporation shall be chosen by the Board of Directors. These may include a
Chairman (who shall be a Director), and shall include a President, one or more
Vice Presidents (the number thereof to be determined by the Board of Directors),
a Secretary and a Treasurer. The Board of Directors may also in their discretion
appoint Assistant Secretaries, Assistant Treasurers and other officers, agents
and employees, who shall have such authority and perform such duties as the
Board of Directors may determine. The Board of Directors may fill any vacancy
which may occur in any office. Any two offices, except those of President and
Vice President, may be held by the same person, but no officer shall execute,
acknowledge or verify any instrument in more than one capacity, if such
instrument is required by law or these By-Laws to be executed, acknowledged or
verified by two or more officers.
Section 2. TERM OF OFFICE. The term of office of all officers
shall be one year and until their respective successors are chosen and
qualified. Any officer may be removed from office at any time with or without
cause by the vote of a majority of all the Directors then in office.
Section 3. POWERS AND DUTIES. The officers of the Corporation
shall have such powers and duties as generally pertain to their respective
offices, as well as such powers and duties as may from time to time be conferred
by the Board of Directors.
ARTICLE IV
SHARE INTERESTS
Section 1. CERTIFICATES FOR SHARES. Stockholders are not
entitled to receive certificates evidencing their share ownership, unless the
Board of Directors shall by resolution otherwise determine.
Section 2. TRANSFER OF SHARES. Shares of the Corporation shall
be transferable on the register of the Corporation by the holder thereof in
person
<PAGE>
6
or by his agent duly authorized in writing, upon delivery to the Board of
Directors or the Transfer Agent of a duly executed instrument of transfer,
together with such evidence of the genuineness of each such execution and
authorization of such other matter as the Corporation or its agents may
reasonably require.
Section 3. REGISTER OF SHARES. A register of the Corporation,
containing the names and addresses of the Stockholders and the number of shares
held by them respectively and a record of all transfers thereof, shall be kept
at the principal offices of the Corporation or, if the Corporation employs a
Transfer Agent, at the offices of the Transfer Agent of the Corporation.
ARTICLE V
FISCAL YEAR
The fiscal year of the Corporation for reporting and
accounting purposes shall begin on the first day of November and shall end on
the last day of October in each year.
ARTICLE VI
INDEMNIFICATION
Section 1. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The
Corporation shall indemnify to the fullest extent permitted by law (including
the Investment Company Act of 1940) as currently in effect or as the same may
hereafter be amended, any person made or threatened to be made a party to any
action, suit or proceeding, whether criminal, civil, administrative or
investigative, by reason of the fact that such person or such person's testator
or intestate is or was a Director or officer of the Corporation or serves or
served at the request of the Corporation any other enterprise as a director or
officer. To the fullest extent permitted by law (including the Investment
Company Act of 1940) as currently in effect or as the same may hereafter be
amended, expenses incurred by any such person in defending any such action, suit
or proceeding shall be paid or reimbursed by the Corporation promptly upon
receipt by it of: (i) a written affirmation by the person of his good faith
belief that the standard of conduct necessary for indemnification by the
Corporation has been met; and (ii) an undertaking of such person to repay such
expenses if it is ultimately determined that such person is not entitled to be
indemnified by the Corporation. The rights provided to any person by this
Article shall be enforceable against the Corporation by such person who shall be
presumed to have relied upon it in serving or continuing to serve as a Director
or officer as provided above. No amendment of this Article shall impair the
rights of any person arising at any time with respect to events occurring prior
to such amendment. For purposes of this Article, the term "Corporation" shall
include any predecessor of the Corporation and any constituent corporation
(including any constituent of a constituent) absorbed by the Corporation in a
consolidation or merger; the term "other enterprises" shall include any
corporation, partnership, joint venture, trust or employee benefit plan; service
<PAGE>
7
"at the request of the Corporation" shall include service as a Director or
officer of the Corporation which imposes duties on, or involves services by,
such Director or officer with respect to an employee benefit plan, its
participants or beneficiaries; any excise taxes assessed on a person with
respect to an employee benefit plan shall be deemed to be indemnifiable
expenses; and action by a person with respect to any employee benefit plan which
such person reasonably believes to be in the interest of the participants and
beneficiaries of such plan shall be deemed to be action not opposed to the best
interests of the Corporation. Notwithstanding anything in this Section to the
contrary, no Director or officer of the Corporation shall be indemnified against
any liability to the Corporation or its Stockholders to which such Director or
officer would otherwise be subject by reason of his wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of his office.
Section 2. INSURANCE. Subject to the provisions of the
Investment Company Act of 1940, the Corporation, directly, through third parties
or through affiliates of the Corporation, may purchase, or provide through a
trust fund, letter of credit or surety bond insurance on behalf of any person
who is or was a Director, officer, employee or agent of the Corporation, or who,
while a Director, officer, employee or agent of the Corporation, is or was
serving at the request of the Corporation as a Director, officer, employee,
partner, trustee or agent of another foreign or domestic corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against and incurred by such person in any such capacity or arising out
of such person's position, whether or not the Corporation would have the power
to indemnify such person against such liability.
ARTICLE VII
CUSTODIAN
The Corporation shall place and at all times maintain in the
custody of a custodian (including any sub-custodian for the custodian) all
funds, securities and similar investments owned by the Corporation. Subject to
the approval of the Board of Directors, the custodian may enter into
arrangements with securities depositories. All such custodial, sub-custodial and
depository arrangements shall be subject to, and comply with, the provisions of
the Investment Company Act of 1940 and the rules and regulations promulgated
thereunder.
ARTICLE VIII
AMENDMENT OF BY-LAWS
The By-Laws of the Corporation may be altered, amended, added
to or repealed by the Stockholders or by majority vote of all the Directors then
in office; but any such alteration, amendment, addition or repeal of the By-Laws
by action of the Directors may be altered or repealed by Stockholders.
WS5368C
THE 59 WALL STREET FUND, INC.
AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT
THE 59 WALL STREET U.S. EQUITY FUND
AGREEMENT, originally made on the 9th day of June, 1992 as amended and
restated November 1, 1993 between THE 59 WALL STREET FUND, INC., a Maryland
corporation (the "Corporation"), on behalf of The 59 Wall Street U.S. Equity
Fund (the "Fund"), and BROWN BROTHERS HARRIMAN & CO., a New York limited
partnership (the "Adviser"),
WHEREAS, the Corporation is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Corporation desires to retain the Adviser to render investment
advisory services to the Fund, and the Adviser is willing to render such
services;
NOW, THEREFORE, this Agreement
WITNESSETH:
that in consideration of the premises and mutual promises hereinafter set forth,
the parties hereto agree as follows:
1. The Corporation hereby appoints the Adviser to act as investment adviser
to the Fund for the period and on the terms set forth in this Agreement. The
Adviser accepts such appointment and agrees to render the services herein set
forth, for the compensation herein provided.
2. Subject to the general supervision of the Directors of the Corporation,
the Adviser shall manage the investment operations of the Fund and the
composition of the Fund's portfolio of securities and investments, including
cash, the purchase, retention and disposition thereof and agreements relating
thereto, in accordance with the Fund's investment objective and policies as
stated in the Prospectus (as defined in paragraph 3 of this Agreement) and
subject to the following understandings:
(a) the Adviser shall furnish a continuous investment program for
the Fund's portfolio and determine from time to time what investments
or securities will be purchased, retained, sold or lent by the Fund,
and what portion of the assets will be invested or held uninvested as
cash;
(b) the Adviser shall use the same skill and care in the
management of the Fund's portfolio as it uses in the administration of
other accounts for which it has investment responsibility as agent;
<PAGE>
WS5368C
(c) the Adviser, in the performance of its duties and obligations
under this Agreement, shall act in conformity with the Corporation's
Articles of Incorporation and By-Laws and the Prospectus of the Fund
and with the instructions and directions of the Directors of the
Corporation and will conform to and comply with the requirements of the
1940 Act and all other applicable federal and state laws and
regulations including, without limitation, the regulations and rulings
of the New York State Banking Department;
(d) the Adviser shall determine the securities to be purchased,
sold or lent by the Fund and as agent for the Fund will effect
portfolio transactions pursuant to its determinations either directly
with the issuer or with any broker and/or dealer in such securities; in
placing orders with brokers and or dealers the Adviser intends to seek
best price and execution for purchases and sales and may effect
transactions through itself on a securities exchange provided that the
commissions paid by the Fund are "reasonable and fair" compared to
commissions received by other broker-dealers having comparable
execution capability in connection with comparable transactions
involving similar securities and provided that the transactions in
connection with which such commissions are paid are effected pursuant
to procedures established by the Directors of the Corporation; the
Adviser shall also make recommendations regarding whether or not the
Fund shall enter into contracts for the purchase or sale for future
delivery of contracts providing for the making or acceptance of a cash
settlement based upon changes in the value of an index of securities,
or put or call option contracts, with respect to the Fund's portfolio.
On occasions when the Adviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as other customers, the
Adviser, may, to the extent permitted by applicable laws and regulations, but
shall not be obligated to, aggregate the securities to be so sold or purchased
in order to obtain the best execution and lower brokerage commissions, if any.
In such event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Adviser in the manner
it considers to be the most equitable and consistent with its fiduciary
obligations to the Fund and to such other customers;
(e) the Adviser shall maintain books and records with respect to
the Fund's securities transactions and shall render to the
Corporation's Directors such periodic and special reports as the
Directors may reasonably request; and
(f) the investment management services of the Adviser to the Fund
under this Agreement are not to be deemed exclusive, and the Adviser
shall be free to render similar services to others.
3. The Corporation has delivered copies of each of the following documents
to the Adviser and will promptly notify and deliver to it all future amendments
and supplements, it any:
<PAGE>
WS5368C
(a) Articles of Incorporation of the Corporation, filed with the
State of Maryland on July 16, 1990 (such Articles of Incorporation, as
presently in effect and as amended from time to time, are herein called
the "Articles of Incorporation");
(b) By-Laws of the Corporation (such By-Laws, as presently in
effect and as amended from time to time, are herein called the
"By-Laws");
(c) Certified resolutions of the Directors of the Corporation
authorizing the appointment of the Adviser and approving the form of
this Agreement;
(d) Registration Statement under the 1940 Act and the Securities
Act of 1933, as amended, on Form N-IA (No. 33-48605) (the "Registration
Statement") as filed with the Securities and Exchange Commission (the
"Commission") on March 1, 1993 relating to the Corporation and the
shares of common stock, par value $0.001 per share (the "Shares"), of
the Fund;
(e) Notification of Registration of the Corporation under the 1940
Act on Form N-8A as filed with the Commission on July 16, 1990; and
(f) Prospectus of the Fund, dated March 1, 1993 (such prospectus,
as presently in effect and as amended or supplemented with respect to
the Fund from time to time, is herein called the "Prospectus").
4. The Adviser shall keep the Fund's books and records required to be
maintained by it pursuant to paragraph 2(e). The Adviser agrees that all records
which it maintains for the Fund are the property of the Fund and it will
promptly surrender any of such records to the Fund upon the Fund's request. The
Adviser further agrees to preserve for the periods prescribed by Rule 3la-2 of
the Commission under the 1940 Act any such records as are required to be
maintained by the Adviser with respect to the Fund by Rule 3 1 a- I of the
Commission under the 1940 Act.
5. During the term of this Agreement the Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement other than
the cost of securities and investments purchased for the Fund (including taxes
and brokerage commissions, if any).
6. For the services provided and the expenses borne pursuant to this
Agreement, the Adviser will receive from the Fund as full compensation therefor
a fee at an annual rate equal to 0.65% of the Fund's average daily net assets.
This fee will be computed based on net assets at 4:00 P.M. New York time on each
day the New York Stock Exchange is open for trading and will be paid to the
Adviser monthly during the succeeding calendar month.
7. The Adviser shall not be liable for any error of judgment or mistake of
law or for any loss suffered by the Fund in connection with the matters to which
this Agreement relates, except a loss resulting from a breach of fiduciary duty
with respect to the receipt of compensation for services (in which case any
award of damages shall be limited to the period and the amount set forth in
Section 36(b)(3) of the 1940 Act) or a loss resulting from wilful misfeasance,
<PAGE>
WS5368C
bad faith or gross negligence on its part in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement.
8. This Agreement shall continue in effect for two years from the date of
its execution and thereafter, but only so long as its continuance is
specifically approved at least annually in conformity with the requirements of
the 1940 Act; provided, however, that this Agreement may be terminated with
respect to the Fund by the Corporation at any time, without the payment of any
penalty, by vote of a majority of all the Directors of the Corporation or by
"vote of a majority of the outstanding voting securities" of the Fund on 60
days' written notice to the Adviser, or by the Adviser at any time, without the
payment of any penalty, on 90 days' written notice to the Corporation. This
Agreement will automatically and immediately terminate in the event of its
"assignment".
9. The Adviser shall for all purposes herein be deemed to be an independent
contractor and shall, unless otherwise expressly provided herein or authorized
by the Directors of the Corporation from time to time, have no authority to act
for or represent the Fund or the Corporation in any way or otherwise be deemed
an agent of the Fund or the Corporation.
10. This Agreement may be amended by mutual consent, but the consent of the
Corporation must be approved (a) by vote of a majority of those Directors of the
Corporation who are not parties to this Agreement or "interested persons" of any
such party, cast in person at a meeting called for the purpose of voting on such
amendment, and (b) by "vote of a majority of the outstanding voting securities"
of the Fund.
11. As used in this Agreement, the terms "assignment", "interested persons"
and "vote of a majority of the outstanding voting securities" shall have the
meanings assigned to them respectively in the 1940 Act.
12. Notices of any kind to be given to the Adviser by the Corporation shall
be in writing and shall be duly given if mailed or delivered to the Adviser at
59 Wall Street, New York, New York 10005, Attention: Treasurer, or at such other
address or to such other individual as shall be specified by the Adviser to the
Corporation. Notices of any kind to be given to the Corporation by the Adviser
shall be in writing and shall be duly given if mailed or delivered to the
Corporation at The 59 Wall Street Fund, Inc., 6 St. James Avenue, Boston,
Massachusetts 02116, Attention: Secretary, or at such other address or to such
other individual as shall be specified by the Corporation to the Adviser.
13. The Directors have authorized the execution of this Agreement in their
capacity as Directors and not individually and the Adviser agrees that neither
the shareholders nor the Directors nor any officer, employee, representative or
agent of the Corporation shall be personally liable upon, nor shall resort be
had to their private property for the satisfaction of, obligations given,
executed or delivered on behalf of or by the Corporation, that the shareholders,
Directors, officers, employees, representatives and agents of the Corporation
shall not be personally liable hereunder, and the Adviser shall look solely to
the property of the Corporation for the satisfaction of any claim hereunder.
<PAGE>
14. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers or Partners designated below on the day and year
first above written.
THE 59 WALL STREET FUND
/S/ J.V. SHIELDS, JR.
ATTEST: By.................................
BROWN BROTHERS HARRIMAN & CO.
/S/ JOHN A. NIELSEN
ATTEST: By.................................
WS5368A
THE 59 WALL STREET FUND, INC.
AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT
THE 59 WALL STREET SHORT/INTERMEDIATE FIXED INCOME FUND
AGREEMENT, originally made on the 9th day of June, 1992 as amended and
restated November 1, 1993 between THE 59 WALL STREET FUND, INC., a Maryland
corporation (the "Corporation"), on behalf of The 59 Wall Street
Short/Intermediate Fixed Income Fund (the "Fund"), and BROWN BROTHERS HARRIMAN &
CO., a New York limited partnership (the "Adviser"),
WHEREAS, the Corporation is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Corporation desires to retain the Adviser to render investment
advisory services to the Fund, and the Adviser is willing to render such
services;
NOW, THEREFORE, this Agreement
WITNESSETH:
that in consideration of the premises and mutual promises hereinafter set forth,
the parties hereto agree as follows:
1. The Corporation hereby appoints the Adviser to act as investment adviser
to the Fund for the period and on the terms set forth in this Agreement. The
Adviser accepts such appointment and agrees to render the services herein set
forth, for the compensation herein provided.
2. Subject to the general supervision of the Directors of the Corporation,
the Adviser shall manage the investment operations of the Fund and the
composition of the Fund's portfolio of securities and investments, including
cash, the purchase, retention and disposition thereof and agreements relating
thereto, in accordance with the Fund's investment objective and policies as
stated in the Prospectus (as defined in paragraph 3 of this Agreement) and
subject to the following understandings:
(a) the Adviser shall furnish a continuous investment program for
the Fund's portfolio and determine from time to time what investments
or securities will be purchased, retained, -sold or lent by the Fund,
and what portion of the assets will be invested or held uninvested as
cash;
(b) the Adviser shall use the same skill and care in the
management of the Fund's portfolio as it uses in the administration of
other accounts for which it has investment responsibility as agent;
(c) the Adviser, in the performance of its duties and obligations
under this Agreement, shall act in conformity with the Corporation's
Articles of Incorporation and By-Laws and the Prospectus of the Fund
and
<PAGE>
with the instructions and directions of the Directors of the
Corporation and will conform to and comply with the requirements of the
1940 Act and all other applicable federal and state laws and
regulations including, without limitation, the regulations and rulings
of the New York State Banking Department;
(d) the Adviser shall determine the securities to be purchased,
sold or lent by the Fund and as agent for the Fund will effect
portfolio transactions pursuant to its determinations either directly
with the issuer or with any broker and/or dealer in such securities; in
placing orders with brokers and/or dealers the Adviser intends to seek
best price and execution for purchases and sales; the Adviser shall
also make recommendations regarding whether or not the Fund shall enter
into repurchase or reverse repurchase agreements and interest rate
futures contracts.
On occasions when the Adviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as other
customers, the Adviser, may, to the extent permitted by applicable laws
and regulations, but shall not be obligated to, aggregate the
securities to be so sold or purchased in order to obtain the best
execution and lower brokerage commissions, if any. In such event,
allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Adviser in
the manner it considers to be the most equitable and consistent with
its fiduciary obligations to the Fund and to such other customers;
(e) the Adviser shall maintain books and records with respect to
the Fund's securities transactions and shall render to the
Corporation's Directors such periodic and special reports as the
Directors may reasonably request; and
(f) the investment management services of the Adviser to the Fund
under this Agreement are not to be deemed exclusive, and the Adviser
shall be free to render similar services to others.
3. The Corporation has delivered copies of each of the following documents
to the Adviser and will promptly notify and deliver to it all future amendments
and supplements, it any:
(a) Articles of Incorporation of the Corporation, filed with the
State of Maryland on July 16, 1990 (such Articles of Incorporation, as
presently in effect and as amended from time to time, are herein called
the "Articles of Incorporation");
(b) By-Laws of the Corporation (such By-Laws, as presently in
effect and as amended from time to time, are herein called the
"By-Laws");
(c) Certified resolutions of the Directors of the Corporation
authorizing the appointment of the Adviser and approving the form of
this Agreement;
(d) Registration Statement under the 1940 Act and the Securities
Act of 1933, as amended, on Form N- IA (No. 33-48605) (the
"Registration
<PAGE>
Statement") as filed with the Securities and Exchange Commission (the
"Commission") on March 1, 1993 relating to the Corporation and the
shares of common stock, par value $0.001 per share (the "Shares"), of
the Fund;
(e) Notification of Registration of the Corporation under the 1940
Act on Form N-8A as filed with the Commission on July 16, 1990; and
(f) Prospectus of the Fund, dated March 1, 1993 (such prospectus,
as presently in effect and as amended or supplemented with respect to
the Fund from time to time, is herein called the "Prospectus").
4. The Adviser shall keep the Fund's books and records required to be
maintained by it pursuant to paragraph 2(e). The Adviser agrees that all records
which it maintains for the Fund are the property of the Fund and it will
promptly surrender any of such records to the Fund upon the Fund's request. The
Adviser further agrees to preserve for the periods prescribed by Rule 3 1 a-2 of
the Commission under the 1940 Act any such records as are required to be
maintained by the Adviser with respect to the Fund by Rule 3 1 a- I of the
Commission under the 1940 Act.
5. During the term of this Agreement the Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement other than
the cost of securities and investments purchased for the Fund (including taxes
and brokerage commissions, if any).
6. For the services provided and the expenses borne pursuant to this
Agreement, the Adviser will receive from the Fund as full compensation therefor
a fee at an annual rate equal to 0.40% of the Fund's average daily net assets.
This fee will be computed based on net assets at 4:00 P.M. New York time on each
day the New York Stock Exchange is open for trading and will be paid to the
Adviser monthly during the succeeding calendar month.
7. The Adviser shall not be liable for any error of judgment or mistake of
law or for any loss suffered by the Fund in connection with the matters to which
this Agreement relates, except a loss resulting from a breach of fiduciary duty
with respect to the receipt of compensation for services (in which case any
award of damages shall be limited to the period and the amount set forth in
Section 36(b)(3) of the 1940 Act) or a loss resulting from wilful misfeasance,
bad faith or gross negligence on its part in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement.
8. This Agreement shall continue in effect for two years from the date of
its execution and thereafter, but only so long as its continuance is
specifically approved at least annually in conformity with the requirements of
the 1940 Act; provided, however, that this Agreement may be terminated with
respect to the Fund by the Corporation at any time, without the payment of any
penalty, by vote of a majority of all the Directors of the Corporation or by
"vote of a majority of the outstanding voting securities" of the Fund on 60
days' written notice to the Adviser, or by the Adviser at any time, without the
payment of any penalty, on 90 days' written notice to the Corporation. This
Agreement will automatically and immediately terminate in the event of its
"assignment".
9. The Adviser shall for all purposes herein be deemed to be an independent
contractor and shall, unless otherwise expressly provided herein or
<PAGE>
authorized by the Directors of the Corporation from time to time, have no
authority to act for or represent the Fund or the Corporation in any way or
otherwise be deemed an agent of the Fund or the Corporation.
10. This Agreement may be amended by mutual consent, but the consent of the
Corporation must be approved (a) by vote of a majority of those Directors of the
Corporation who are not parties to this Agreement or "interested persons" of any
such party, cast in person at a meeting called for the purpose of voting on such
amendment, and (b) by "vote of a majority of the outstanding voting securities"
of the Fund.
11. As used in this Agreement, the terms "assignment", "interested persons"
and "vote of a majority of the outstanding voting securities" shall have the
meanings assigned to them respectively in the 1940 Act.
12. Notices of any kind to be given to the Adviser by the Corporation shall
be in writing and shall be duly given if mailed or delivered to the Adviser at
59 Wall Street, New York, New York 10005, Attention: Treasurer, or at such other
address or to such other individual as shall be specified by the Adviser to the
Corporation. Notices of any kind to be given to the Corporation by the Adviser
shall be in writing and shall be duly given if mailed or delivered to the
Corporation at The 59 Wall Street Fund, Inc., 6 St. James Avenue, Boston,
Massachusetts 02116, Attention: Secretary, or at such other address or to such
other individual as shall be specified by the Corporation to the Adviser.
13. The Directors have authorized the execution of this Agreement in their
capacity as Directors and not individually and the Adviser agrees that neither
the shareholders nor the Directors nor any officer, employee, representative or
agent of the Corporation shall be personally liable upon, nor shall resort be
had to their private property for the satisfaction of, obligations given,
executed or delivered on behalf of or by the Corporation, that the shareholders,
Directors, officers, employees, representatives and agents of the Corporation
shall not be personally liable hereunder, and the Adviser shall look solely to
the property of the Corporation for the satisfaction of any claim hereunder.
14. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers or Partners designated below on the day and year
first above written.
THE 59 WALL STREET FUND, INC.
/S/ J.V. SHIELDS, JR.
ATTEST: By...........................................
BROWN BROTHERS HARRIMAN & CO.
/S/ JOHN A. NIELSEN
ATTEST: By...........................................
EXHIBIT 11
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Post-Effective Amendment
No. 5 to Registration Statement (No. 33-48605) of The 59 Wall Street Fund, Inc.
on behalf of The 59 Wall Street U.S. Equity Fund and The 59 Wall Street
Short/Intermediate Fixed Income Fund (two of the series constituting The 59 Wall
Street Fund, Inc.) of our report dated December 12, 1995, appearing in the
Annual Report to Shareholders for the year ended October 31, 1995, and to the
reference to us under the heading "Financial Highlights," appearing in the
Prospectus, which is a part of such Registration Statement.
/s/ DELOITTE & TOUCHE LLP
Boston, Massachusetts
February 28, 1996
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the 59 Wall
Street Fund, Inc. Annual Report, dated 10/31/95 and is qualified in its entirety
by reference to such Annual Report.
</LEGEND>
<CIK> 0000865898
<NAME> THE 59 WALL STREET FUND, INC.
<SERIES>
<NUMBER> 4
<NAME> THE 59 WALL STREET U.S. EQUITY FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1995
<PERIOD-START> NOV-01-1994
<PERIOD-END> OCT-31-1995
<INVESTMENTS-AT-COST> 25,688,633
<INVESTMENTS-AT-VALUE> 31,869,718
<RECEIVABLES> 769,821
<ASSETS-OTHER> 305,649
<OTHER-ITEMS-ASSETS> 7,740
<TOTAL-ASSETS> 32,979,928
<PAYABLE-FOR-SECURITIES> 898,100
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 82,145
<TOTAL-LIABILITIES> 980,245
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 25,001,032
<SHARES-COMMON-STOCK> 877,598
<SHARES-COMMON-PRIOR> 741,450
<ACCUMULATED-NII-CURRENT> 61,602
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 755,964
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,181,085
<NET-ASSETS> 31,999,683
<DIVIDEND-INCOME> 525,152
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 308,934
<NET-INVESTMENT-INCOME> 216,218
<REALIZED-GAINS-CURRENT> 667,354
<APPREC-INCREASE-CURRENT> 5,189,897
<NET-CHANGE-FROM-OPS> 6,073,469
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 223,291
<DISTRIBUTIONS-OF-GAINS> 377,049
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 300,861
<NUMBER-OF-SHARES-REDEEMED> 178,354
<SHARES-REINVESTED> 13,641
<NET-CHANGE-IN-ASSETS> 9,875,277
<ACCUMULATED-NII-PRIOR> 68,675
<ACCUMULATED-GAINS-PRIOR> 465,659
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 167,339
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 599,819
<AVERAGE-NET-ASSETS> 25,744,442
<PER-SHARE-NAV-BEGIN> 29.84
<PER-SHARE-NII> 0.26
<PER-SHARE-GAIN-APPREC> 7.15
<PER-SHARE-DIVIDEND> 0.28
<PER-SHARE-DISTRIBUTIONS> 0.51
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 36.46
<EXPENSE-RATIO> 1.20
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the 59 Wall
Street Fund, Inc. Annual Report, dated 10/31/95 and is qualified in its
entiretyby reference to such Annual Report.
</LEGEND>
<CIK> 0000865898
<NAME> THE 59 WALL STREET FUND, INC.
<SERIES>
<NUMBER> 5
<NAME> THE 59 WALL STREET SHORT/INTERMEDIATE FIXED INCOME FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1995
<PERIOD-START> NOV-01-1994
<PERIOD-END> OCT-31-1995
<INVESTMENTS-AT-COST> 10,424,365
<INVESTMENTS-AT-VALUE> 10,543,527
<RECEIVABLES> 187,338
<ASSETS-OTHER> 98,384
<OTHER-ITEMS-ASSETS> 7,689
<TOTAL-ASSETS> 10,836,938
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,932
<TOTAL-LIABILITIES> 6,932
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 11,144,066
<SHARES-COMMON-STOCK> 1,109,810
<SHARES-COMMON-PRIOR> 1,102,117
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (433,222)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 119,162
<NET-ASSETS> 10,830,006
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 653,866
<OTHER-INCOME> 0
<EXPENSES-NET> 85,403
<NET-INVESTMENT-INCOME> 568,463
<REALIZED-GAINS-CURRENT> (246,469)
<APPREC-INCREASE-CURRENT> 661,339
<NET-CHANGE-FROM-OPS> 983,333
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 568,662
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 604,528
<NUMBER-OF-SHARES-REDEEMED> 625,878
<SHARES-REINVESTED> 29,043
<NET-CHANGE-IN-ASSETS> 502,480
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (186,753)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 40,190
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 210,553
<AVERAGE-NET-ASSETS> 10,047,440
<PER-SHARE-NAV-BEGIN> 9.37
<PER-SHARE-NII> 0.54
<PER-SHARE-GAIN-APPREC> 0.39
<PER-SHARE-DIVIDEND> 0.54
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.76
<EXPENSE-RATIO> 0.85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
