As filed with the Securities and Exchange Commission on February 28, 1996
Registration Nos. 33-35827 and 811-06139
(The 59 Wall Street European Equity Fund)
(The 59 Wall Street Pacific Basin Equity Fund)
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 17
AND/OR
REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 23
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)
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 ended October 31, 1995.
================================================================================
<PAGE>
EXPLANATORY NOTE
This Amendment (the "Amendment") to the Registrant's Registration
Statement relates to the Prospectus of The 59 Wall European Equity Fund and The
59 Wall Street Pacific Basin Equity 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 U.S. Equity Fund and The 59 Wall Street Short/Intermediate
Fixed Income Fund) are offered by the Prospectus that was included in Part A of
Amendment No. 20 to the Registrant's Registration Statement ("Amendment No.
20"). 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 U.S.
Equity Fund and The 59 Wall Street Short/Intermediate Fixed Income Fund, which
is incorporated herein by reference from Amendment No. 20, and the Prospectus of
The 59 Wall Street International Equity Fund, which is incorporated herein by
reference from Amendment No. 15.
WS5230M
<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. . . . . Description of Shares;
Investment Objective and
Policies; Investment
Restrictions
Item 5. Management of the Fund . . . . . . . . . . Management of the
Corporation; Expense
Table
Item 5A. Management's Discussion of Fund
Performance . . . . . . . . . . . . . . Not Applicable
Item 6. Capital Stock and Other Securities . . . . Description of Shares;
Purchase of Shares;
Dividends and
Distributions; Taxes
Item 7. Purchases of Securities Being Offered. . . Management of the
Corporation of Shares; Net
Asset Value; Dividends and
Distributions
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 . . Administrators;
Distributor; Investment
Adviser
Item 17. Brokerage Allocation and Other Practices . Portfolio Transactions
Item 18. Capital Stock and Other Securities . . . . Description of Shares
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>
================================================================================
PROSPECTUS
The 59 Wall Street European Equity Fund
The 59 Wall Street Pacific Basin Equity Fund
6 St. James Avenue, Boston, Massachusetts 02116
================================================================================
The 59 Wall Street European Equity Fund and The 59 Wall Street Pacific
Basin Equity Fund are separate portfolios of The 59 Wall Street Fund, Inc.
Shares of each Fund are offered by this Prospectus.
The European Equity Fund and the Pacific Basin Equity Fund are each
designed to enable investors to participate in the opportunities available in
foreign equity markets. The investment objective of each Fund is to provide
investors with long-term maximization of total return, primarily through capital
appreciation. There can be no assurance that a 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 who can assume
the risk involved in investing in equity securities of foreign-based companies.
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.
================================================================================
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................................................. 11
Purchase of Shares...................................................... 11
Redemption of Shares.................................................... 12
Management of the Corporation........................................... 13
Net Asset Value......................................................... 17
Dividends and Distributions............................................. 17
Taxes................................................................... 17
Description of Shares................................................... 19
Additional Information ................................................. 20
Appendix................................................................ 21
TERMS USED IN THIS PROSPECTUS
Corporation......................... The 59 Wall Street Fund, Inc.
Funds............................... The 59 Wall Street European Equity Fund
(the "European Equity Fund")
The 59 Wall Street Pacific Basin Equity
Fund (the "Pacific Basin Equity 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
<PAGE>
EXPENSE TABLE
================================================================================
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
European Pacific Basin
Equity Fund Equity 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)
European Pacific Basin
Equity Fund Equity Fund
----------- -------------
Investment Advisory Fee........................... 0.65% 0.65%
12b-1 Fee......................................... None None
Other Expenses
Administration Fee ............................ 0.15% 0.15%
Shareholder Servicing/Eligible Institution Fee.. 0.25 0.25
Other Expenses ................................. 0.19 0.59 0.19 0.59
---- ---- ---- ----
Total Operating Expenses Paid by Fund............. 1.24% 1.24%
Expenses paid by commissions/expense offset
arrangements.................................... 0.19 0.19
---- ----
Total Fund Operating Expenses................. 1.43% 1.43%
==== ====
Example 1 year 3 years 5 years 10 years
------- ------ ------- ------- --------
European 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:.................. $15 $45 $78 $171
--- --- --- ----
Pacific Basin 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:........... $15 $45 $78 $171
--- --- --- ----
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.
For more information with respect to the expenses of each Fund see
"Management of the Corporation" herein.
3
<PAGE>
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>
European Equity Fund Pacific Basin Equity Fund
------------------------------------------ -----------------------------------------
For the years ended October 31, For the years ended October 31,
------------------------------------------ -----------------------------------------
1995 1994 1993 1992 1991 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year.... $31.82 $31.17 $27.15 $25.35 $25.00 $39.85 $39.87 $27.53 $27.65 $25.00
Income from invest-
ment operations:
Net investment
income............. 0.45 0.39 0.21 0.29 0.31 0.11 0.14 0.14 0.12 0.10
Net realized and
unrealized gain.... 2.09 1.80 6.09 1.74 0.04 (4.50) 1.26 13.18 0.33 2.55
Less dividends and
distributions:
Dividends to share-
holders from net
investment income -- (0.25) (0.36) (0.23) -- (0.00)* (0.14) (0.02) (0.18) --
Distributions to share-
holders from net
realized gains..... (2.41) (1.29) (1.91) -- -- (5.58) (1.28) (0.96) (0.39) --
Distributions to share-
holders in excess of
net realized gains.. -- -- (0.01) -- -- -- -- -- -- --
----- ------ ------ ----- ----- ----- ----- ----- ----- -----
Net asset value, end
of year............ $31.95 $31.82 $31.17 $27.15 $25.35 $29.88 $39.85 $39.87 $27.53 $27.65
===== ====== ====== ====== ====== ====== ====== ====== ======= ======
Cumulative investment
return............. 9.42% 7.35% 24.82% 7.87% 1.60% (10.62)% 3.48% 50.01% 1.68% 10.68%
Ratios/Supplemental
Data:
Net assets, end of
period (000's
omitted)......... $116,955 $110,632 $88,860 $27,426 $14,231 $114,932 $120,469 $92,863 $31,250 $20,492
Expenses as a
percentage of
average net assets:
Expenses paid by
Fund............. 1.24% 1.37% 1.50% 1.50% 1.50% 1.24% 1.29% 1.50% 1.50% 1.50%
Expenses paid by
commissions**.... 0.05% n/a n/a n/a n/a 0.05% n/a n/a n/a n/a
Expense offset
arrangements..... 0.14% n/a n/a n/a n/a 0.14% n/a n/a n/a n/a
----- ------ ------ ----- ----- ----- ----- ----- ----- -----
Total expenses..... 1.43% 1.37% 1.50% 1.50% 1.50% 1.43% 1.29% 1.50% 1.50% 1.50%
Ratio of net investment
income to average
net assets......... 1.55% 1.30% 1.28% 1.71% 1.54% 0.53% 0.39% 0.62% 0.43% 0.64%
Portfolio turnover rate 72% 124% 37% 50% 58% 82% 86% 79% 84% 56%
Average commission
rate paid per share*** $0.0216 -- -- -- -- $0.0092 -- -- -- --
</TABLE>
- ------------
* Less than $0.01 per share.
** A portion of the Fund's securities transactions are directed to certain
unaffiliated brokers which in turn use a portion of the commissions they
receive from the Fund to pay other unaffiliated service providers on behalf
of the Fund for services provided for which the Fund would otherwise be
obligated to pay.
*** Most foreign securities markets do not charge commissions based on a rate
per share but as a percentage of the principal value of the transaction. As
a result, the above rate is not indicative of the commission arrangements
currently in effect.
Further information about performance of the Funds is contained in the
Fund's annual report to shareholders which may be obtained without charge.
4
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
================================================================================
The investment objective of each Fund is to provide investors with
long-term maximization of total return, primarily through capital appreciation.
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 assets of the European Equity Fund under normal circumstances are fully
invested in equity securities of companies based in the European Economic
Community (Germany, France, Italy, United Kingdom, Spain, Netherlands, Belgium,
Denmark, Greece, Portugal, Ireland, Luxembourg), as well as Switzerland,
Austria, Norway, Sweden, Finland, Turkey, the Czech Republic, Slovakia, Hungary,
Poland and Romania, although no more than 5% of that Fund's assets is invested
in securities of any single Eastern European country. The following table is a
comparison of market capitalization, Gross Domestic Product (GDP) and population
of European countries.
EUROPEAN STATISTICS
<TABLE>
<CAPTION>
Market Gross Domestic
Capitalization Product Population
------------------------- --------------------------- -------------------
Dollars % of Dollars % of % of
(Billions) Total* (Billions) Total* (Millions) Total*
---------- ------ ---------- ------ ---------- ------
<S> <C> <C> <C> <C> <C> <C>
EUROPEAN UNION
- --------------
UNITED KINGDOM ................. 1,344 32.9 1,025 13.1 58 11.6
GERMANY......................... 586 14.3 1,834 23.4 81 16.2
FRANCE ......................... 525 12.8 1,420 18.1 58 11.6
NETHERLANDS .................... 287 7.0 334 4.3 15 3.0
ITALY .......................... 208 5.1 1,018 13.0 57 11.4
SWEDEN ......................... 192 4.7 197 2.5 9 1.8
SPAIN .......................... 149 3.6 483 6.2 39 7.8
BELGIUM ........................ 110 2.7 217 2.8 10 2.0
DENMARK ........................ 50 1.2 146 1.9 5 1.0
FINLAND ........................ 36 0.9 97 1.2 5 1.0
AUSTRIA ........................ 34 0.8 185 2.4 8 1.6
IRELAND......................... 26 0.6 52 0.7 4 0.8
PORTUGAL........................ 22 0.5 68 0.9 10 2.0
GREECE.......................... 17 0.4 78 1.0 10 2.0
LUXEMBOURG.................. 5 0.1 10 0.1 1 0.2
----- ---- ----- ---- --- ----
SUBTOTAL...................... 3,591 87.8 7,164 91.6 370 73.9
OTHER WESTERN EUROPE
- --------------------
SWITZERLAND..................... 402 9.8 257 3.3 7 1.4
NORWAY.......................... 43 1.1 123 1.6 4 0.8
TURKEY......................... 31 0.8 132 1.7 61 12.2
----- ---- ----- ---- --- ----
SUBTOTAL...................... 476 11.6 512 6.6 72 14.4
WESTERN EUROPE TOTAL.............. 4,067 99.4 7,676 98.1 442 88.2
EASTERN EUROPE
- --------------
CZECH REPUBLIC.................. 17 0.4 36 0.5 10 2.0
POLAND.......................... 5 0.1 68 0.9 39 7.8
HUNGARY ........................ 1 0.0 41 0.5 10 2.0
----- ----- ----- ----- ----- -----
SUBTOTAL...................... 23 0.6 145 1.9 59 11.8
----- ----- ----- ----- ----- -----
EUROPE TOTAL...................... 4,090 100.0 7,821 100.0 501 100.0
===== ====== ===== ===== ===== =====
</TABLE>
Sources: International Monetary Fund and Datastream.
GDP and population data is for 1994. Market capitalization data is as
of December 31, 1995.
- ----------
* Figures may not add due to rounding differences.
5
<PAGE>
The assets of the Pacific Basin Equity Fund under normal circumstances are
fully invested in equity securities of companies based in Pacific Basin
countries, including Japan, Hong Kong, Australia, Malaysia, Singapore, South
Korea, Taiwan, Thailand, India, Philippines, Indonesia, New Zealand, China,
Pakistan, Sri Lanka and Bangladesh. The following table is a comparison of
market capitalization, GDP and population of Pacific Basin countries.
PACIFIC BASIN STATISTICS
<TABLE>
<CAPTION>
Market Gross Domestic
Capitalization Product Population
---------------------- --------------------- ------------------
Dollars % of Dollars % of % of
(Billions) Total (Billions) Total (Millions) Total
-------- ----- -------- ----- -------- -----
<S> <C> <C> <C> <C> <C> <C>
JAPAN............................. 3,670 67.5 4,591 64.4 125 4.3
HONG KONG......................... 305 5.6 147 2.1 6 0.2
AUSTRALIA......................... 230 4.2 323 4.5 18 0.6
MALAYSIA ......................... 217 4.0 71 1.0 19 0.7
SINGAPORE......................... 203 3.7 69 1.0 3 0.1
TAIWAN............................ 192 3.5 262 3.7 21 0.7
KOREA............................. 182 3.3 380 5.3 45 1.5
THAILAND.......................... 142 2.6 143 2.0 59 2.0
INDIA............................. 122 2.3 258 3.6 902 30.9
INDONESIA......................... 66 1.2 175 2.4 192 6.6
PHILIPPINES ...................... 59 1.1 64 0.9 67 2.3
NEW ZEALAND....................... 33 0.6 51 0.7 3 0.1
PAKISTAN.......................... 10 0.2 51 0.7 127 4.4
SRI LANKA......................... 2 0.1 12 0.2 18 0.6
CHINA............................. 2 0.1 508 7.1 1,196 41.0
BANGLADESH........................ 1 0.0 25 0.4 115 4.0
----- ----- ----- ----- ----- -----
TOTAL............................. 5,436 100.0 7,130 100.0 2,916 100.0
===== ===== ===== ===== ===== =====
</TABLE>
Sources: I.M.F. and Datstream
Population and GDP figures are as of 1994 (except for India GDP
based on 1993); market capitalization as of 1995.
Although the assets of each of the Funds are expected to be invested
primarily in common stocks, other securities with equity characteristics may be
purchased, including securities convertible into common stock, corporation or
limited partnership interests, rights and warrants. These equity securities may
be purchased directly or in the form of American Depository Receipts, European
Depository Receipts or other similar securities representing securities of
foreign-based companies. Although each of the Funds invests primarily in equity
securities which are traded on foreign or domestic securities exchanges, equity
securities which are traded in foreign or domestic over-the-counter markets may
be purchased for each of the Funds. (See "Investment Restrictions".)
The Investment Adviser uses the investment research and economic studies
made available to it by leading banks and brokers around the world, as well as
the analysis and judgment of the investment professionals in its New York, Tokyo
and London offices, to allocate the assets of each Fund among the countries in
6
<PAGE>
which a Fund may invest and to identify market sectors, industries and companies
with favorable prospects.
Criteria for determining the appropriate allocation of investments among
various countries focus on liquidity conditions, valuation levels, earnings
growth potential, and technical factors. Included among these criteria are the
more traditional analyses of relative economic growth, expected levels of
inflation, currency prospects and government policies. In response to changes or
anticipated changes in these criteria, a particular country's representation in
a Fund's portfolio is increased, decreased or eliminated. As a result of
applying these criteria a Fund's assets are allocated among countries in a
manner which does not reflect the relative size or valuation of a country's
capital market or a country's relative GDP or population.
In constructing the portfolio of securities of each Fund, emphasis is
placed on the equity securities of larger companies with strong longer term
fundamentals such as leading industry position, effective management,
competitive products and services, high or improving return on investment and a
sound financial structure. Selection of individual equities is the product of a
disciplined process which systematically evaluates growth expectations relative
to price levels.
Foreign Currency Exchange Transactions. Because securities denominated in
currencies other than the U.S. dollar are bought and sold for the Funds, and
interest, dividends and sale proceeds are received by each of the Funds in
currencies other than the U.S. dollar, foreign currency exchange transactions
from time to time are entered into for the Funds to convert to and from
different foreign currencies and to convert foreign currencies to and from the
U.S. dollar.
These transactions are agreements to exchange currencies at a specific rate
either for settlement two days thereafter (i.e., spot market or spot contracts)
or for settlement on a future date (i.e., forward contracts). Forward contracts
may be entered into only in an attempt to protect against possible changes in
foreign currency exchange rates that would adversely affect a portfolio position
or an anticipated portfolio position. At any time the effect of future changes
in the foreign exchange rate arising from an outstanding forward contract can be
offset by entering into an offsetting forward contract expiring on the same
date.
These foreign exchange contracts are made with currency dealers, usually
large commercial banks and financial institutions. Although foreign exchange
rates are volatile, foreign exchange markets are generally liquid with the
equivalent of approximately $500 billion traded worldwide on a typical day. Spot
contracts and forward contracts generally have no deposit requirements and are
traded at a net price without commission.
Since consideration of the prospect for currency parities are incorporated
into the Investment Adviser's long-term investment decisions, foreign currency
hedging transactions with respect to portfolio security positions are not
routinely entered into for either Fund. However, the Investment Adviser believes
that it is important to have the flexibility to enter into foreign currency
hedging transactions when it determines that the transactions would be in a
Fund's best interest, including the closing out or offsetting of an existing
position.
Although these transactions may reduce the risk of loss due to a decline in
the value of the hedged currency, they also tend to limit the potential for
gain. The precise matching of the forward contract amounts and the value of the
securities involved is not generally possible because the future value of such
securities in foreign currencies changes as a consequence of market movements in
the value of such securities between the date the forward contract is entered
into and the date it matures. The projection of currency market movements is
extremely difficult, and the successful execution of a hedging strategy is
highly unlikely.
Neither spot nor forward foreign exchange contracts eliminate fluctuations
in the prices of a Fund's portfolio securities or in foreign exchange rates, or
prevent loss if the prices of these securities should decline.
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,
7
<PAGE>
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.
Risk Factors. Investing in equity securities of foreign-based companies
involves risks not typically associated with investing in equity securities of
companies organized and operated in the United States. The value of the
investments of the Funds may be adversely affected by changes in political or
social conditions, diplomatic relations, confiscatory taxation, expropriation,
nationalization, limitation on the removal of funds or assets, or imposition of
(or change in) exchange control or tax regulations. In addition, changes in
government administrations or economic or monetary policies in the United States
or abroad could result in appreciation or depreciation of portfolio securities
and could favorably or unfavorably affect a Fund's operations. Furthermore, the
economies of individual foreign nations differ from the U.S. economy, whether
favorably or unfavorably, in areas such as growth of GDP, rate of inflation,
capital reinvestment, resource self-sufficiency and balance of payments
position; it may also be more difficult to obtain and enforce a judgment against
a foreign company. The foreign investments made for either Fund are made in
compliance with the currency regulations and tax laws of the United States and
foreign governments. There may also be foreign government regulations and laws
which restrict the amounts and types of foreign investments.
Because foreign securities generally are denominated and pay dividends or
interest in foreign currencies, and each Fund holds various foreign currencies
from time to time, the value of the net assets of each Fund as measured in U.S.
dollars is affected favorably or unfavorably by changes in exchange rates. Each
Fund also incurs costs in connection with conversion between various currencies.
In general, less information is publicly available with respect to
foreign-based companies than is available with respect to U.S. companies. Most
foreign-based companies are also not subject to the uniform accounting and
financial reporting requirements applicable to companies based in the United
States.
In addition, while the volume of transactions effected on foreign stock
exchanges has increased in recent years, in most cases it remains appreciably
below that of the New York Stock Exchange. Accordingly, the investments of each
Fund are less liquid and their prices are more volatile than comparable
investments in securities of U.S. companies. Moreover, the settlement periods
for foreign securities, which are often longer than those for securities of U.S.
companies, may affect portfolio liquidity. In buying and selling securities on
foreign exchanges, fixed commissions are normally paid that are generally higher
than the negotiated commissions charged in the United States. In addition, there
is generally less government supervision and regulation of securities exchanges,
brokers and companies in foreign countries than in the United States.
Special Risks Concerning Eastern Europe and Developing Countries. The
European Equity Fund may invest in securities of issuers based in Eastern Europe
and in developing countries. The Pacific Basin Equity Fund may invest a
substantial portion of its assets in the securities of issuers based in
developing countries. These investments may be subject to potentially greater
risks than those of other foreign issuers. These risks include: (i) potentially
less social, political and economic stability; (ii) the small current size of
the markets for such securities and the low volume of trading, which result in
less liquidity and in greater price volatility; (iii) certain national policies
which may restrict the Funds' investment opportunities, including restrictions
on investment in issuers or industries deemed sensitive to national interests;
(iv) foreign taxation; (v) the absence of fully developed legal structures
governing private or foreign investment or allowing for judicial redress for
injury to private property; (vi) the absence, until recently of a capital market
structure or market oriented economy as well as issuers without a long period of
successful operations; and (vii) the possibility that recent favorable economic
developments may be slowed or reversed by unanticipated political or social
events in such countries or their neighboring countries.
8
<PAGE>
Investments in such countries may involve risks of nationalization,
expropriation and confiscatory taxation. The governments of some of these
countries expropriated large amounts of private property in the past, in many
cases without adequate compensation, and there may be no assurance that such
expropriation will not occur in the future. In the event of such expropriation,
a Fund could lose a substantial portion of any investments it has made in the
affected countries. Further, less well developed accounting standards exist in
some of these countries. Finally, even though currencies may be currently
convertible into U.S. dollars, the conversion rates may be artificial to the
actual market values and may be adverse to each Fund's shareholders.
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 indices may be purchased for a Fund.
Put and call options on currency may also be purchased for the Funds for the
sole purpose of reducing risk. (See Appendix on page 21 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 a Fund, although in
each case 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.
Put and call option contracts may be purchased for a 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
options ("OTC Options") purchased are treated as not readily marketable. (See
"Investment Restrictions".)
Portfolio Brokerage
The portfolio of each of the Funds is managed actively in pursuit of its
investment objective. Securities are not traded for short-term profits but, when
circumstances warrant, securities are sold without regard to the length of time
held. A 100% annual turnover rate would occur, for example, if all securities in
a Fund's portfolio (excluding short-term obligations) were replaced once in a
period of one year. The portfolio turnover rate for the European Equity Fund was
72% for the fiscal year ended October 31, 1995. For the same time period, the
portfolio turnover rate for the Pacific Basin Equity Fund was 82%. 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 level of portfolio activity
increases.
In effecting securities transactions for a Fund, the Investment Adviser
seeks to obtain the best price and execution of orders. In selecting a broker,
the Investment Adviser considers a number of factors including: the broker's
ability to execute orders without disturbing the market price; the broker's
reliability for prompt, accurate confirmations and on-time delivery of
securities; the broker's financial condition; and the commissions charged.
The Investment Adviser may direct a portion of a Fund's securities
transactions to certain unaffiliated brokers which in turn use a portion of the
commissions they receive from that Fund to pay other unaffiliated service
providers on behalf of that Fund for services provided for which that Fund would
otherwise be obligated to pay. Such commissions paid by a Fund are at the same
rate paid to other brokers for effecting similar transactions in listed equity
securities.
All of the transactions for the Funds are executed through qualified
brokers other than Brown Brothers Harriman & Co. In selecting such brokers, the
Investment Adviser considers 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 by such
brokers. 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.
9
<PAGE>
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 the
Funds. In some instances, this procedure might adversely affect a Fund.
Other Investment Techniques
Short-Term Instruments. The assets of each Fund may be invested in non-U.S.
dollar denominated and U.S. dollar denominated short-term instruments, including
U.S. dollar denominated repurchase agreements. Cash is held for each Fund in
demand deposit accounts with the Funds' custodian bank.
Restricted Securities. Securities that have legal or contractual
restrictions on their resale may be acquired for a Fund. The price paid for
these securities, or received upon resale, may be lower than the price paid or
received for similar securities with a more liquid market. Accordingly, the
valuation of these securities for a Fund reflects any limitation on their
liquidity. (See "Investment Restrictions".)
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 that 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 is 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.
Commitments for such when-issued or delayed delivery securities are made only
when there is an intention of actually acquiring the securities. 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.
Investment Company Securities. Subject to applicable statutory and
regulatory limitations, the assets of each Fund may be invested in shares of
other investment companies. Under the 1940 Act, assets of either Fund may be
invested in shares of other investment companies in connection with a merger,
consolidation, acquisition or reorganization or if immediately after such
investment (i) 10% or less of the market value of that Fund's total assets would
be so invested, (ii) 5% or less of the market value of that Fund's total assets
would be invested in the shares of any one such company, and (iii) 3% or less of
the total outstanding voting stock of any other investment company would be
owned by that Fund.
10
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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 each Fund is invested in equity securities of companies based in
countries in which that Fund may invest. For these purposes, equity securities
are defined as common stock, securities convertible into common stock,
corporation or limited partnership interests, rights and warrants, and include
securities purchased directly and in the form of American Depository Receipts,
European Depository Receipts or other similar securities representing common
stock of foreign-based companies.
In accordance with applicable regulations, a Fund does not purchase any
restricted security, OTC option, repurchase agreement maturing in more than
seven days, security of a foreign issuer which is not listed on a recognized
domestic or foreign securities exchange, 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.
The European Equity Fund and the Pacific Basin Equity Fund are each
classified as "non-diversified" under the 1940 Act, which means that neither of
these Funds is limited by the 1940 Act with respect to the portion of its assets
which may be invested in securities of a single company (although certain
diversification requirements are imposed by the Internal Revenue Code of 1986,
as amended). The possible assumption of large positions in the securities of a
small number of companies may cause the performance of each of these Funds to
fluctuate to a greater extent than that of a diversified investment company as a
result of changes in the financial condition or in the market's assessment of
the companies.
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 15) and each Eligible Institution (see page 15) 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.
11
<PAGE>
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
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 or 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. 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. Brown Brothers Harriman & Co., the Funds' Shareholder Servicing Agent
has established a minimum initial purchase requirement 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.)
Shares of each Fund may be purchased by exchanging securities acceptable to
the Corporation for shares of either of the Funds. The Corporation does not
accept a security in exchange for Fund shares unless (a) the security is
consistent with the investment objective and policies of the Fund for whose
shares the security is being exchanged, and (b) the security is deemed
acceptable by the Investment Adviser. Securities offered in exchange for shares
of either Fund are valued in accordance with the usual valuation procedures for
the Funds. (See "Net Asset Value" on page 17.)
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.
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<PAGE>
Redemptions By the Corporation
The Funds' Shareholder Servicing Agent (see page 15) and each Eligible
Institution (see page 15) 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, in which case the redemption
fee would also apply. 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., the Funds' Shareholder
Servicing Agent, has established a minimum account size of $25,000 and 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).
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 to the Corporation
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
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<PAGE>
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.
Mr. John A. Nielsen is the portfolio manager for the Funds. Mr. Nielsen is
the partner responsible for international equity investment management at Brown
Brothers Harriman & Co. Mr. Nielsen holds a B.A. from Bucknell University, a
M.B.A. from Columbia University and is a Chartered Financial Analyst. He joined
Brown Brothers Harriman & Co. in 1968.
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 each
Fund an annual fee, computed daily and payable monthly, equal to 0.65% 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
14
<PAGE>
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 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
shares 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
15
<PAGE>
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
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.
Distributor
59 Wall Street Distributors acts as exclusive Distributor of shares of the
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
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. State Street employs
subcustodians, each of which has been approved by the Board of Directors in
accordance with the regulations of the Securities and Exchange Commission, for
the purpose of providing custodial services for foreign assets held outside the
United States for each Fund. The Board of Directors monitors the activities of
the Custodian and each subcustodian. 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.
16
<PAGE>
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 and realized net
short-term capital gains in excess of net long-term capital losses ("Net
Income") is declared and paid to shareholders at least annually as a dividend,
and substantially all of each Fund's realized net long-term capital gains in
excess of net short-term capital losses is 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 in a given year 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.
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 continue 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 (the "Code"). Accordingly,
the Funds are not subject to federal income taxes on its Net Income and realized
net long-term capital gains in excess of net short-term capital losses that are
distributed to its 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 continue 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
17
<PAGE>
paid from the Funds are not eligible for the dividends-received deduction
allowed to corporate shareholders because the income of the Funds does not
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.
The Funds may be subject to foreign withholding taxes with respect to
income received from sources within foreign countries. So long as more than 50%
in value of a Fund's total assets at the close of any fiscal year consists of
stock or securities of foreign corporations, at the election of the Corporation
any such foreign income taxes paid by a Fund may be treated as paid directly by
its shareholders. The Corporation makes such an election only if it deems it to
be in the best interest of that Fund's shareholders and notifies shareholders in
writing each year if it makes the election and of the amount of foreign income
taxes, if any, to be treated as paid by the shareholders. If the Corporation
makes the election, each Fund shareholder would be required in computing federal
income tax liability to include in income that shareholder's proportionate share
of the amount of foreign income taxes paid by that Fund and would be entitled to
claim either a credit (which is subject to certain limitations), or, if
deductions are itemized, a deduction for that shareholder's share of the foreign
income taxes paid by that Fund. (No deduction is permitted in computing
alternative minimum tax liability.) Certain entities, including Corporations
formed as part of corporate pension or profit-sharing plans and certain
charitable and other organizations described in Section 501 (c) of the Code,
that are generally exempt from federal income taxes may not receive any benefit
from the election by the Corporation to "pass through" foreign income taxes to a
Fund's shareholders.
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.
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Other Information
Annual notification as to the tax status of capital gains distributions, if
any, is 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 as shares of the European Equity Fund and 25,000,000 as shares of the
Pacific Basin Equity 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.
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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 MSCI-Europe and MSCI-Pacific). 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.
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.
20
<PAGE>
APPENDIX--HEDGING STRATEGIES
================================================================================
Options on Stock Indexes. 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), the
New York Stock Exchange Composite Index (New York Stock Exchange), The Financial
Times-Stock Exchange 100 (London Traded Options Market), the Nikkei 225 Stock
Average (Osaka Securities Exchange) and Tokyo Stock Price Index (Tokyo 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 depends 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 is equal to such difference between the closing
price of the index and the strike price of the option expressed in U.S. dollars
or a foreign currency, as the case may be, 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 a 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 a 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 Currencies. A call option on a currency gives the purchaser of
the option the right to buy the underlying currency at a fixed price, either at
any time during the option period (American style) or on the expiration date
(European style). Similarly, a put option gives the purchaser of the option the
right to sell the underlying currency at a fixed price, either at any time
during the option period or on the expiration date. To liquidate a put or call
option position, a "closing sale transaction" may be made for a Fund at any time
prior to the expiration of the option, such a transaction involves selling the
option previously purchased. Options on currencies are traded both on recognized
exchanges (such as the Philadelphia Options Exchange) and over-the-counter.
The value of a currency option purchased for a Fund depends upon future
changes in the value of that currency before the expiration of the option.
Accordingly, the successful use of options on currencies for a Fund is subject
to the Investment Adviser's ability to predict future changes in the value of
currencies over the short term. Brokerage costs are incurred in the purchase of
currency options and an incorrect assessment of future changes in the value of
currencies may result in a poorer overall performance than if such a currency
had not been purchased.
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<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]
European Equity Fund
Pacific Basin Equity Fund
PROSPECTUS
February 8, 1996
<PAGE>
================================================================================
STATEMENT OF ADDITIONAL INFORMATION
THE 59 WALL STREET EUROPEAN EQUITY FUND
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
6 ST. JAMES AVENUE, BOSTON, MASSACHUSETTS 02116
================================================================================
The 59 Wall Street European Equity Fund (the "European Equity Fund")
and The 59 Wall Street Pacific Basin Equity Fund (the "Pacific Basin Equity
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"). Each Fund is designed to enable investors to participate in the
opportunities available in foreign equity markets. The investment objective of
each Fund is to provide investors with long-term maximization of total return,
primarily through capital appreciation. There can be no assurance that a 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 5-10
Investment Restrictions . . . . . . . . 9 13
Investment Adviser . . . . . . . . . . 12 13-14
Administrator . . . . . . . . . . . . 13 14-15
Distributor . . . . . . . . . . . . 14 16
Net Asset Value; Redemption in Kind . . . . 14 17
<PAGE>
Computation of Performance . . . . . . . 15 20
Federal Taxes . . . . . . . . . . . . 16 17- 19
Description of Shares . . . . . . . . . 19 19
Portfolio Transactions . . . . . . . . . 20 9-10
Additional Information . . . . . . . . . 22 20
Financial Statements . . . . . . . . . 23 4
THE DATE OF THIS STATEMENT OF ADDITIONAL INFORMATION IS FEBRUARY 28, 1996.
2
<PAGE>
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.
DOMESTIC INVESTMENTS
The assets of the Funds are not invested in domestic securities (other
than short-term instruments), except temporarily when extraordinary
circumstances prevailing at the same time in a significant number of foreign
countries render investments in such countries inadvisable.
FUTURES AND OPTIONS CONTRACTS
OPTIONS ON STOCK. For the sole purpose of reducing risk, put and call
options on stocks may be purchased for a Fund, although in each case 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. 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 a Fund at any time prior to the expiration of the
option which involves selling the option previously purchased.
Covered call options may also be sold (written) on stocks
2
<PAGE>
for a Fund, although in each case the current intention is not to do so. A call
option is "covered" if the writer owns the underlying security.
FUTURES CONTRACTS ON STOCK INDEXES AND FOREIGN CURRENCIES. For the sole
purpose of reducing risk, futures contracts on stock indexes ("Futures
Contracts") may be entered into for a Fund, 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. Futures contracts on foreign currencies may also be entered into for
each Fund, although in each case the current intention is not to do so.
In order to assure that a Fund is 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 provided for the making and acceptance of a cash
settlement based upon changes in the value of an index of stocks and are used to
hedge against anticipated future changes in 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 stock index selected. The value of a Futures Contract depends upon future
movements 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
3
<PAGE>
select an appropriate index and to predict future price movements over the short
term in the overall stock market. The incorrect choice of an index or an
incorrect assessment of future price movements over the short term 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 "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, 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).
Investments in Futures Contracts on non-U.S. stock indexes and options on such
Futures Contracts by U.S. investors, such as the Funds, currently are prohibited
by the Commodities Exchange Act unless the CFTC has designated a board of trade
as a contract market for such Futures Contracts or options.
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 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 overall stock market prices against which that
Fund seeks a hedge.
LOANS OF PORTFOLIO SECURITIES
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<PAGE>
Securities of a Fund may be loaned if such loans are secured
continuously by cash or equivalent liquid short term securities as 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.
SHORT-TERM INVESTMENTS
Although it is intended that the assets of each Fund stay invested in
the securities described above and in the Prospectus to the extent practical in
light of that Fund's investment objective and long-term investment perspective,
a Fund's assets may be invested in short-term instruments to meet anticipated
expenses or for day-to-day operating purposes and when, in the Investment
Adviser's opinion, it is advisable to adopt a temporary defensive position
because of unusual and adverse conditions affecting the equity markets. In
addition, when a Fund experiences large cash inflows through issuance of new
shares or the sale of portfolio securities, and desirable equity securities that
are consistent with that Fund's investment objective are unavailable in
sufficient quantities, assets of that Fund may be held in short-term investments
for a limited time pending availability of such equity securities. Short-term
instruments consist of foreign and domestic: (i) short-term obligations of
sovereign governments, their agencies, instrumentalities, authorities or
political subdivisions; (ii) other short-term debt securities rated A or higher
by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation
("Standard & Poor's"), or if unrated are of comparable quality in the opinion of
the Investment Adviser; (iii) commercial paper; (iv) bank obligations, including
negotiable certificates of deposit, time deposits and bankers' acceptances; and
(v) repurchase agreements. Time deposits with a maturity of more than seven days
are treated as not readily
5
<PAGE>
marketable. (See clause (vi) under the caption "State and Federal
Restrictions".) At the time a Fund's assets are invested in commercial paper,
bank obligations or repurchase agreements, the issuer must have outstanding debt
rated A or higher by Moody's or Standard & Poor's; the issuer's parent
corporation, if any, must have outstanding commercial paper rated Prime-1 by
Moody's or A-1 by Standard & Poor's; or, if no such ratings are available, the
instrument must be of comparable quality in the opinion of the Investment
Adviser. The assets may be invested in non-U.S. dollar denominated and U.S.
dollar denominated short-term instruments, including U.S. dollar denominated
repurchase agreements.
REPURCHASE AGREEMENTS. Repurchase agreements may be entered into for a
Fund only with a "primary dealer" (as designated by the Federal Reserve Bank of
New York) in U.S. Government securities. This is an agreement in which the
seller (the "Lender") of a security agrees to repurchase from a 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 a 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. The
securities which are subject to repurchase agreements, however, may have
maturity dates in excess of one week from the effective date of the repurchase
agreement. A 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 that
Fund in each agreement along with accrued interest. Payment for such securities
is made for that Fund only upon physical delivery or evidence of book entry
transfer to the account of State Street Bank and Trust Company (the
"Custodian"). If the Lender defaults, a 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 a Fund may be delayed or limited in certain
circumstances. Repurchase agreements with more than seven days to maturity are
treated as not readily marketable. (See clause (vi) under the caption "State and
Federal Restrictions".)
INVESTMENT RESTRICTIONS
================================================================================
Each Fund is operated under the following investment
6
<PAGE>
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
Funds, 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 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), 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;
(3) write, purchase or sell any put or call option or any combination
thereof, provided that this shall not prevent (i) the purchase, ownership,
holding or sale of warrants where the grantor of the warrants is the issuer of
the underlying securities, or (ii) the purchase, ownership, holding or sale of
futures and options, other than the writing of put options;
(4) 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;
(5) 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
7
<PAGE>
than seven days, or (c) by purchasing, subject to the limitation in paragraph
(6) 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
are part of an issue to the public shall not be considered the making of a loan;
(6) 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);
(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; or
(11) invest more than 5% of its total assets in the securities or
obligations of any one issuer (other than U.S.
8
<PAGE>
Government obligations) or more than 10% of its total assets in the outstanding
voting securities of any one issuer; provided, however, that up to 25% of its
total assets may be invested without regard to this restriction, and provided
further, that neither Fund shall be subject to this restriction.
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 that 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 maturing in more than seven days, securities of
foreign issuers which are not listed on a recognized domestic or foreign
securities exchange 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
9
<PAGE>
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, or (ix) purchase or retain in its portfolio any securities
issued by an issuer any of whose 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 for 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
for a Fund 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
10
<PAGE>
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. 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); and 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.
11
<PAGE>
OFFICERS OF THE CORPORATION
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).
12
<PAGE>
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).
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 the management, owned beneficially more than 5% of the outstanding shares of
a Fund. However, as of that date, partners of Brown Brothers Harriman & Co. and
their immediate families owned 75,226 (1.9%) and 75,351 (1.7%) shares,
respectively, of the European Equity Fund and the Pacific Basin Equity Fund.
Also, Brown Brothers Harriman & Co. Employee Pension Plan on that date held
14
<PAGE>
66,742 (1.7%) and 83,467 (1.9%) shares, respectively, of the European Equity
Fund and the Pacific Basin Equity Fund. Brown Brothers Harriman & Co. and its
affiliates separately are able to direct the disposition of an additional
1,705,973 (43.2%) and 2,032,652 (47.2%) shares, respectively, of the European
Equity Fund and the Pacific Basin Equity Fund, as to which shares Brown Brothers
Harriman & Co. disclaims beneficial ownership.
INVESTMENT ADVISER
================================================================================
Under its Investment Advisory Agreement 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.
The Investment Advisory Agreement between Brown Brothers Harriman & Co.
and the Corporation is dated September 5, 1990 as amended and restated November
1, 1993. The agreement remains in effect for two years from its date and
thereafter, but only so long as such agreement is specifically approved with
respect to each Fund 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 ("Independent Directors"), cast in person at a meeting called for
the purpose of voting on such approval. The Investment Advisory Agreement was
most recently approved by the Independent Directors on August 22, 1995. The
Investment Advisory Agreement terminates automatically if assigned 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 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 European Equity Fund, the investment 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
15
<PAGE>
investment advisory fee was an annual rate equal to 0.75% 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 $372,553, $663,717 and
$715,205, respectively, for advisory services.
With respect to the Pacific Basin Equity Fund, the investment 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 an annual rate equal to 0.75%
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
$410,421, $740,878 and $695,032, 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
================================================================================
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
16
<PAGE>
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 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 European Equity Fund and
Pacific Basin Equity Fund incurred $24,837, and $27,361, respectively, for
administrative services. For the fiscal year ended October 31, 1994 the European
Equity Fund and Pacific Basin Equity Fund incurred $153,165 and $170,972,
respectively, for administrative services. For the fiscal years ended October
31, 1995 the European Equity Fund and Pacific Basin Equity Fund incurred
$165,044 and $160,392, 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 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".
17
<PAGE>
(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 of a Fund's shares is determined each day
the New York Stock Exchange is open for regular trading and New York banks are
open for business. (As of the date of this Statement of Additional Information,
such Exchange and banks are so open every weekday except for the following
holidays: New Year's Day, Martin Luther King 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 domestic securities exchange is
based on the last sale prices as of the regular close 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. Securities listed on a foreign exchange are valued at the last
quoted sale price available before the time at which net assets are valued.
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. For purposes of
calculating net asset value per share, all assets and liabilities initially
expressed in foreign currencies are converted into U.S. dollars at the
prevailing market rates available at the time of valuation.
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. Such procedures include the use of independent pricing services,
which use prices based upon yields or prices of securities of comparable
quality, coupon, maturity and type; indications as to values from dealers; and
general market conditions. Short-term investments which
18
<PAGE>
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.
Trading in securities on most foreign exchanges and over-the-counter
markets is normally completed before the close of the New York Stock Exchange
and may also take place on days the New York Stock Exchange is closed. If events
materially affecting the value of foreign securities occur between the time when
the exchange on which they are traded closes and the time when a Fund's net
asset value is calculated, such securities would be valued at fair value in
accordance with procedures established by and under the general supervision of
the Corporation's 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
19
<PAGE>
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, and (b)
subtracting 1 from the result.
The average annual rate of return for the European Equity Fund and the
Pacific Basin Equity Fund for the fiscal year ended October 31, 1995 was 9.42%
and (10.62)%, respectively. The annualized average rate of return for the
European Equity Fund and the Pacific Basin Equity Fund for the period November
1, 1990 (commencement of operations) to October 31, 1995 was 9.95% and 9.32%,
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.
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, foreign
currencies or other income derived with respect to its
20
<PAGE>
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). Foreign currency gains that
are not directly related to a Fund's business of investing in stock or
securities is included in the income that counts toward the 30% gross income
requirement described above but may be excluded by Treasury Regulations from
income that counts toward the 90% of gross income requirement described above.
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.
Under the Code, gains or losses attributable to foreign currency
contracts, or to fluctuations in exchange rates between the time a Fund accrues
income or receivables or expenses or other liabilities denominated in a foreign
currency and the time that Fund actually collects such income or pays such
liabilities, are treated as ordinary income or ordinary loss. Similarly, gains
or losses on the disposition of debt securities held by a Fund, if any,
denominated in foreign currency, to the extent attributable to fluctuations in
exchange rates between the acquisition and disposition dates are also treated as
ordinary income or loss.
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 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
21
<PAGE>
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.
If shares are purchased for a Fund in certain foreign investment
entities, referred to as "passive foreign investment companies", that Fund
itself may be subject to U.S. federal income tax, and an additional charge in
the nature of interest, on a portion of any "excess distribution" from such
company or gain from the disposition of such shares, even if the distribution or
gain is paid by that Fund as a dividend to its shareholders. If a Fund were able
and elected to treat a passive foreign investment company as a "qualified
electing fund", in lieu of the treatment described above, that Fund would be
required each year to include in income, and distribute to shareholders in
accordance with the distribution requirements set forth above, that Fund's pro
rata share of the ordinary earnings and net capital gains of the company,
whether or not distributed to that Fund.
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.
FOREIGN TAXES. If the Corporation elects to treat foreign income taxes
paid from a Fund as paid directly by that Fund's shareholders, each Fund
shareholder would be required to include in income such shareholder's
proportionate share of the amount of
22
<PAGE>
foreign income taxes paid by that Fund and would be entitled to claim either a
credit or a deduction in such amount. Shareholders who choose to utilize a
credit (rather than a deduction) for foreign taxes are subject to the limitation
that the credit may not exceed the shareholder's U.S. tax (determined without
regard to the availability of the credit) attributable to that shareholder's
total foreign source taxable income. For this purpose, the portion of dividends
and capital gains distributions paid from a Fund from its foreign source income
is treated as foreign source income. A Fund's gains and losses from the sale of
securities are generally treated as derived from U.S. sources, however, and
certain foreign currency gains and losses likewise are treated as derived from
U.S. sources. The limitation on the foreign tax credit is applied separately to
foreign source "passive income", such as the portion of dividends received from
a Fund which qualifies as foreign source income. In addition, the foreign tax
credit is allowed to offset only 90% of the alternative minimum tax imposed on
corporations and individuals. Because of these limitations, a shareholder may be
unable to claim a credit for the full amount of such shareholder's proportionate
share of the foreign income taxes paid from a Fund.
In certain circumstances foreign taxes imposed with respect to a Fund's
income may not be treated as income taxes imposed on that Fund. Any such taxes
would not be included in that Fund's income, would not be eligible to be "passed
through" to Fund shareholders, and would not be eligible to be claimed as a
foreign tax credit or deduction by Fund shareholders. In particular, in certain
circumstances it may not be clear whether certain amounts of taxes deducted from
gross dividends paid to a Fund would, for U.S. federal income tax purposes, be
treated as imposed on the issuing corporation rather than that Fund.
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 $0.001 per share, of which 25,000,000 shares have been classified as
shares of the European Equity Fund and 25,000,000 as shares of Pacific Basin
Equity Fund. The Corporation currently consists of six portfolios.
23
<PAGE>
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 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,
24
<PAGE>
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 (a) 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
================================================================================
In effecting securities transactions for a 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 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.
25
<PAGE>
For the fiscal year ended October 31, 1993, the aggregate commissions
paid by the European Equity Fund and the Pacific Basin Equity Fund were $240,136
and $521,938, respectively. For the fiscal year ended October 31, 1994, the
aggregate commissions paid by the European Equity Fund and the Pacific Basin
Equity Fund were $601,690 and $910,697, respectively. For the fiscal year ended
October 31, 1995, the aggregate commissions paid by the European Equity Fund and
the Pacific Basin Equity Fund were $315,790 and $533,000, 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.
All of the transactions for the Funds 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 Funds. 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 a 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 Funds in light of facts
and circumstances deemed
26
<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.
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.
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.
27
<PAGE>
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.
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.
WS5306B
28
<PAGE>
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:
Financial Highlights for the fiscal periods ended October 31, 1991,
October 31, 1992, 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 EUROPEAN EQUITY
FUND AND THE 59 WALL STREET PACIFIC BASIN EQUITY
FUND:
Portfolio of Investments at October 31, 1995.
Statement of Assets and Liabilities at October 31, 1995.
Statement of Operations for the year ended October 31, 1995.
Statement of Changes in Net Assets for the years ended October 31,
1994 and October 31, 1995.
Financial Highlights for the years ended October 31, 1991, October 31,
1992, October 31, 1993, October 31, 1994 and October 31, 1995.
Notes to Financial Statements.
Independent Auditors; Report
Management's Discussion of Fund Performance
(B) EXHIBITS:
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1 -- (a) Restated Articles of Incorporation of
the Registrant.(7)
(b) Designation of Series of The 59 Wall Street
Small Company Fund.(7)
(c) Designation of Series of The 59 Wall Street
Short/Intermediate Fixed Income Fund. (7)
(d) Designation of Series of The 59 Wall Street
U.S. Equity Fund.(7)
(e) Designation of Series of The 59 Wall Street
International Equity Fund.(7)
(f) 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 European Equity Fund
and The 59 Wall Street Pacific Basin
Equity Fund.(7)
(b) Advisory Agreement with respect to The 59
Wall Street Small Company Fund.(5)
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.(5)
(b) Subadministrative Services Agreement.(5)
(c) Form of License Agreement.(1)
(d) Amended and Restated Shareholder Servicing
Agreement.(5)
(e) Amended and Restated Eligible Institution
Agreement.(5)
(f) Expense Reimbursement Agreement with respect
to The 59 Wall Street Small Company
Fund.(5)
(g) Expense Reimbursement Agreement with respect
to The 59 Wall Street European Equity
Fund.(5)
C-2
<PAGE>
(h) Expense Reimbursement Agreement with respect
to The 59 Wall Street Pacific Basin Equity
Fund.(5)
10 -- Opinion of Counsel (including consent).(2)
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.(4)
17 -- Financial Data Schedule.(7)
18 -- Powers of Attorney.(6)
(1) Filed with the initial Registration Statement on July 16, 1990.
(2) Filed with Pre-Effective Amendment No. 1 to this Registration
Statement on October 9, 1990.
(3) Filed with Post-Effective Amendment No. 1 to this Registration
Statement on February 14, 1991.
(4) Filed with Post-Effective Amendment No. 2 to this Registration
Statement on March 1, 1992.
(5) Filed with Post-Effective Amendment No. 5 to this Registration
Statement on December 30, 1993.
(6) Filed with Post-Effective Amendment No. 14 to this Registration
Statement on January 17, 1995.
(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
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<PAGE>
The 59 Wall Street European Equity Fund 1,236
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, administrator, 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
1776 Heritage Drive
North Quincy, MA 02171
(custodian and transfer agent)
ITEM 31. MANAGEMENT SERVICES.
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<PAGE>
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.
C-7
<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
the Board
(J.V. Shields, Jr.)
/s/ PHILIP W. COOLIDGE President (Principal
Executive (Philip W. Coolidge) 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)
<PAGE>
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 Small Company Fund
of the Registrant
1(c) Designation of Series of The 59 Wall Street Short/
Intermediate Fixed Income Fund
1(d) Designation of Series of The 59 Wall Street U.S.
Equity Fund
1(e) Designation of Series of The 59 Wall Street
International Equity Fund
1(f) Designation of Series of The 59 Wall Street Short
Term Fund
2 Amended and Restated By-Laws of the Registrant.
5 Advisory Agreement with respect to The 59 Wall Street European
Equity Fund and The 59 Wall Street Pacific Basin Equity Fund.
11 Consent of Deloitte & Touche LLP
17 Financial Data Schedule
WS5230M
C-10
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 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>
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>
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.
WS5368B
THE 59 WALL STREET FUND, INC.
AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT
THE 59 WALL STREET EUROPEAN EQUITY FUND
THE 59 WALL STREET PACIFIC BASIN EQUITY FUND
AGREEMENT, originally made on the 5th day of September 1990 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 Pacific Basin
Equity Fund and The 59 Wall Street European Equity Fund (referred to herein
individually as a "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 each 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 each 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 each Fund and the
composition of each Fund's portfolio of securities and investments, including
cash, the purchase, retention and disposition thereof and agreements relating
thereto, in accordance with each 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
each Fund's portfolio and determine from time to time what investments
or securities will be purchased, retained, sold or lent by each 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 each Fund's portfolio as it uses in the administration of
other accounts for which it has investment responsibility as agent;
<PAGE>
(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 each 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 each Fund and as agent for each 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 each Fund shall
enter into repurchase or reverse repurchase agreements, contracts for
the purchase or sale for future delivery of foreign currencies,
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 that Fund's portfolio.
On occasions when the Adviser deems the purchase or sale of a
security to be in the best interest of each 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 that Fund and to such other customers;
(e) the Adviser shall maintain books and records with respect to
each 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 each 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, if 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");
<PAGE>
(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- I A (No. 33-35827) (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 each 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 Funds, dated March 1, 1993 (such prospectus,
as presently in effect and as amended or supplemented with respect to
either Fund from time to time, is herein called the "Prospectus").
4. The Adviser shall keep each 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 either Fund are the property of that Fund and it will
promptly surrender any of such records to that Fund upon that 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 either Fund by Rule 31 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 a 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 each Fund as full compensation therefor
a fee at an annual rate equal to 0.65% of that 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 either 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 a 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
<PAGE>
"vote of a majority of the outstanding voting securities" of that 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 a Fund or the Corporation in any way or
otherwise be deemed an agent of either 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 or Funds affected by such amendment.
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.
<PAGE>
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. 17 to Registration Statement (No. 33-35827) of The 59 Wall Street Fund, Inc.
on behalf of The 59 Wall Street European Equity Fund and The 59 Wall Street
Pacific Basin Equity 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> 2
<NAME> THE 59 WALL STREET EUROPEAN 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> 101,956,617
<INVESTMENTS-AT-VALUE> 113,282,824
<RECEIVABLES> 116,695,279
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 239,326,687
<PAYABLE-FOR-SECURITIES> 1,262,600
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 121,108,666
<TOTAL-LIABILITIES> 122,371,266
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 101,049,777
<SHARES-COMMON-STOCK> 3,660,769
<SHARES-COMMON-PRIOR> 3,477,016
<ACCUMULATED-NII-CURRENT> 4,904,283
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 5,070,925
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 5,930,436
<NET-ASSETS> 116,955,421
<DIVIDEND-INCOME> 2,979,696
<INTEREST-INCOME> 95,838
<OTHER-INCOME> 0
<EXPENSES-NET> 1,366,292
<NET-INVESTMENT-INCOME> 1,709,242
<REALIZED-GAINS-CURRENT> 8,772,423
<APPREC-INCREASE-CURRENT> (1,037,893)
<NET-CHANGE-FROM-OPS> 7,734,530
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 8,414,966
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 819,896
<NUMBER-OF-SHARES-REDEEMED> 662,437
<SHARES-REINVESTED> 26,294
<NET-CHANGE-IN-ASSETS> 6,323,848
<ACCUMULATED-NII-PRIOR> 1,238,185
<ACCUMULATED-GAINS-PRIOR> 6,670,324
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 715,205
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,579,125
<AVERAGE-NET-ASSETS> 110,029,583
<PER-SHARE-NAV-BEGIN> 31.82
<PER-SHARE-NII> 0.45
<PER-SHARE-GAIN-APPREC> 2.09
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 2.41
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 31.95
<EXPENSE-RATIO> 1.24
<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 entirety
by reference to such Annual Report.
</LEGEND>
<CIK> 0000865898
<NAME> THE 59 WALL STREET FUND, INC.
<SERIES>
<NUMBER> 1
<NAME> THE 59 WALL STREET PACIFIC BASIN 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> 115,489,669
<INVESTMENTS-AT-VALUE> 113,342,459
<RECEIVABLES> 29,402,497
<ASSETS-OTHER> 330,288
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 143,075,244
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 28,143,033
<TOTAL-LIABILITIES> 28,143,033
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 119,015,764
<SHARES-COMMON-STOCK> 3,846,550
<SHARES-COMMON-PRIOR> 3,022,767
<ACCUMULATED-NII-CURRENT> 3,035,945
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (6,178,137)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (941,361)
<NET-ASSETS> 114,932,211
<DIVIDEND-INCOME> 1,743,131
<INTEREST-INCOME> 143,566
<OTHER-INCOME> 0
<EXPENSES-NET> 1,323,709
<NET-INVESTMENT-INCOME> 562,988
<REALIZED-GAINS-CURRENT> (2,413,051)
<APPREC-INCREASE-CURRENT> (10,854,466)
<NET-CHANGE-FROM-OPS> (12,704,529)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 10,397
<DISTRIBUTIONS-OF-GAINS> 16,805,935
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,474,684
<NUMBER-OF-SHARES-REDEEMED> 700,221
<SHARES-REINVESTED> 49,320
<NET-CHANGE-IN-ASSETS> (5,537,088)
<ACCUMULATED-NII-PRIOR> 472,758
<ACCUMULATED-GAINS-PRIOR> 15,051,535
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 695,032
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,528,165
<AVERAGE-NET-ASSETS> 106,927,964
<PER-SHARE-NAV-BEGIN> 39.85
<PER-SHARE-NII> 0.11
<PER-SHARE-GAIN-APPREC> (4.50)
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 5.58
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 29.88
<EXPENSE-RATIO> 1.24
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
