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International Equity Fund
Emerging Markets Fund
PROSPECTUS
May 20, 1997
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PROSPECTUS
The 59 Wall Street International Equity Fund
The 59 Wall Street Emerging Markets Fund
6 St. James Avenue, Boston, Massachusetts 02116
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The 59 Wall Street International Equity Fund (the "International Equity
Fund") and The 59 Wall Street Emerging Markets Fund (the "Emerging Markets
Fund") (each a "Fund" and collectively the "Funds") are separate non-diversified
portfolios of The 59 Wall Street Fund, Inc. Shares of each Fund are offered by
this Prospectus.
The International Equity Fund is designed to enable investors to
participate in the opportunities available in equity markets outside the United
States and Canada. The Emerging Markets Fund is designed to enable investors to
participate in the opportunities available in emerging 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.
The Corporation seeks to achieve the investment objective of each Fund by
investing all of each Fund's assets in a corresponding non-diversified open-end
investment company having the same investment objective as each Fund. The
Corporation invests all of the assets of the Emerging Markets Fund in the
Emerging Markets Portfolio and all of the assets of the International Equity
Fund in the International Equity Portfolio.
Brown Brothers Harriman & Co. is the investment adviser to the Portfolio
and the administrator and shareholder servicing agent for each Fund. Shares of
the Funds are offered at net asset value and without a sales charge.
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 May 20, 1997. This information is
incorporated herein by reference and is available without charge upon request
from the Funds' distributor, 59 Wall Street Distributors, Inc., 6 St. James
Avenue, Boston, Massachusetts 02116.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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The date of this Prospectus is May 20, 1997.
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TABLE OF CONTENTS
Page
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Expense Table............................................................ 3
Investment Objective and Policies........................................ 4
Investment Restrictions ................................................. 9
Purchase of Shares ...................................................... 10
Redemption of Shares .................................................... 10
Management of the Corporation
and the Portfolios .................................................... 11
Net Asset Value ......................................................... 16
Dividends and Distributions ............................................. 17
Taxes ................................................................... 17
Description of Shares ................................................... 18
Additional Information .................................................. 20
Appendix A .............................................................. 22
Appendix B .............................................................. 24
TERMS USED IN THIS PROSPECTUS
Corporation......................... The 59 Wall Street Fund, Inc.
Funds............................... The 59 Wall Street International
Equity Fund (the "International
Equity Fund")
The 59 Wall Street Emerging Markets
Fund (the "Emerging Markets Fund")
Portfolios.......................... International Equity Portfolio
Emerging Markets Portfolio
Investment Adviser.................. Brown Brothers Harriman & Co.
Administrator of the
Corporation...................... Brown Brothers Harriman & Co.
Administrator of the
Portfolios ...................... Brown Brothers Harriman Trust Company
(Cayman) Limited
Subadministrator of the
Corporation...................... 59 Wall Street Administrators, Inc.
("59 Wall Street Administrators")
Subadministrator of the
Portfolios....................... Signature Financial Group (Cayman)
Limited ("SFG-Cayman")
Distributor ........................ 59 Wall Street Distributors, Inc.
("59 Wall Street Distributors")
1940 Act ........................... The Investment Company Act of 1940,
as amended
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EXPENSE TABLE
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The following table provides (i) a summary of estimated expenses relating
to purchases and sales of shares of each Fund, and the aggregate annual
operating expenses of each Fund and its corresponding Portfolio, 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. The
Directors of the Corporation believe that the aggregate per share expenses of
each Fund and its corresponding Portfolio will be less than or approximately
equal to the expenses which the Fund would incur if the Corporation retained the
services of an investment adviser on behalf of the Fund and the assets of the
Fund were invested directly in the type of securities being held by its
corresponding Portfolio.
SHAREHOLDER TRANSACTION EXPENSES
International Emerging
Equity Fund Markets Fund
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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)
International Emerging
Equity Fund Markets Fund
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Investment Advisory Fee.................. 0.65% 0.90%
12b-1 Fee................................ None None
Other Expenses
Administration Fee..................... 0.16% 0.16%
Shareholder Servicing/Eligible
Institution Fee...................... 0.25 0.25
Other Expenses......................... 0.30 0.71 0.40 0.81%
---- ---- ---- ----
Total Fund Operating Expenses ........... 1.36% 1.71%
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<TABLE>
<CAPTION>
Example 1 year 3 years 5 years 10 years
------- ------ ------ ------- --------
<S> <C> <C> <C> <C>
International 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: ...... $14 $43 $74 $164
--- --- --- ----
Emerging Markets 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:....... $17 $54 $93 $202
--- --- --- ----
</TABLE>
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 and its
corresponding Portfolio, see "Management of the Corporation and the Portfolios"
herein.
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INVESTMENT OBJECTIVE AND POLICIES
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The investment objective of each Fund and its corresponding Portfolio is to
provide investors with long-term maximization of total return, primarily through
capital appreciation.
The investment objective of each Fund and its corresponding Portfolio is a
fundamental policy and may be changed only with the approval of the holders of a
"majority of the outstanding voting securities" (as defined in the 1940 Act) of
the Fund or the Portfolio, as the case may be. (See "Additional Information" in
this Prospectus.) However, the investment policies of each Fund as described
below, will correspond directly to those of its corresponding Portfolio and are
not fundamental and may be changed without such approval.
International Equity Fund
The assets of the International Equity Portfolio under normal circumstances
are fully invested in equity securities of companies based outside the United
States and Canada in the developed markets of the world. These markets include
Japan, United Kingdom, Germany, France, Hong Kong, Netherlands, Switzerland,
Malaysia, Australia, Singapore, Italy, Sweden, Spain, Belgium, Denmark, Finland,
Norway, New Zealand, Austria and Ireland. The Portfolio may also invest in the
less developed markets although no more than 10% of the International Equity
Portfolio's assets will be invested in these markets. In addition, no more than
5% of the International Equity Portfolio will be invested in any one less
developed market. Appendix A provides a comparison of Market Capitalization,
Gross Domestic Product (GDP) and Population of the developed countries in which
the International Equity Portfolio invests.
Although the assets of the International Equity Portfolio are expected to
be invested primarily in common stocks, other securities with equity
characteristics may be purchased, including securities convertible into common
stock, rights and warrants. These equity securities may be purchased directly or
in the form of American Depository Receipts ("ADRs"), Global Depository Receipts
("GDRs") or other similar securities representing securities of foreign-based
companies. Although the International Equity Portfolio 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 the International Equity Portfolio. (See
"Investment Restrictions".) The Portfolio may invest in securities of
appropriate investment companies in order to obtain more favorable investment
terms for the Portfolio or to obtain participation in markets or market sectors.
The Investment Adviser allocates investment among various countries based
upon the economic environment, liquidity conditions, valuation levels, expected
earnings growth, government policies and political stability. In response to
changes or anticipated changes in these criteria, a particular country's
representation in the International Equity Portfolio is increased, decreased or
eliminated. As a result, the International Equity Portfolio's assets are
allocated among countries in a manner which does not reflect the relative size
or valuation of the country's capital market or a country's relative gross
domestic product or population.
In constructing the portfolio of securities of the International Equity
Portfolio, 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.
Emerging Markets Fund
The assets of the Emerging Markets Portfolio under normal circumstances are
fully invested in equity securities of issuers domiciled in or with substantial
operations in emerging markets. For purposes of this prospectus, "emerging
markets" are defined as countries (i) which are included in the MSCI Emerging
Markets Index or the IFC Emerging
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Markets Investable Index (ii) which have a gross national product per capita of
$2,000 or less at the time of the Portfolio's investment, or (iii) which are
generally considered to be developing or emerging countries by the United
Nations development programme or by the World Bank and the International Finance
Corporation. These emerging markets currently include, but are not limited to,
markets such as China, Hong Kong, India, Indonesia, Korea, Malaysia, Pakistan,
Venezuela, Czech Republic, Greece, Hungary, Israel, Jordan, Poland, Portugal,
Russia, South Africa and Turkey. Appendix A provides a comparison of Market
Capitalization, GDP and Population of the emerging countries in which the
Emerging Markets Portfolio may invest.
Emerging markets now comprise roughly 10% of the world's stock market
capitalization. Many emerging markets are expected to continue to experience
faster economic growth rates than those found in more developed markets such as
the U.S., Japan and Western Europe. While the Emerging Markets Fund offers the
opportunity for substantial long term investment return, it also involves above
average investment risk and volatility of investment return.
Although the assets of the Emerging Markets Portfolio are expected to be
invested primarily in common stocks, other securities with equity
characteristics may be purchased, including securities convertible into common
stock, rights and warrants. These equity securities may be purchased directly or
in the form of American Depository Receipts ("ADRs"), Global Depository Receipts
("GDRs") or other similar securities representing securities of foreign-based
companies. Although the Emerging Markets Portfolio 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 Emerging Markets Portfolio. (See "Investment Restrictions".)
The Emerging Markets Portfolio may invest in securities of appropriate
investment companies in order to obtain participation in markets which restrict
foreign investment or to obtain more favorable investment terms for the Emerging
Markets Portfolio. The Emerging Markets Portfolio may invest in emerging market
debt securities if the Investment Adviser determines that the total return of
debt securities may equal or exceed the capital appreciation of equity
securities. Such debt instruments may take the form of bonds, notes, bills,
commercial paper and bank deposits which usually have no rating or a low rating
and which are not considered to be superior in investment quality to equity
securities of the same issuers.
For temporary defensive purposes, the Emerging Markets Portfolio may hold,
without limit, debt obligations of the U.S. government and U.S. dollar deposits
held at banks which are rated within the three highest rating categories for
debt obligations by at least two (unless only rated by one) nationally
recognized statistical rating organizations or, if unrated, are of comparable
quality as determined by or under the direction of the Board of Trustees of the
Emerging Markets Portfolio. It is impossible to predict for how long such a
defensive strategy will be utilized.
The Investment Adviser, during normal market conditions, intends to broadly
diversify the Emerging Markets Portfolio among emerging markets with no more
than 15% of the assets of the Emerging Markets Portfolio in any single market.
The Investment Adviser allocates investment among various countries based upon
the economic environment, liquidity conditions, valuation levels, expected
earnings growth, government policies and political stability. As a result, the
Emerging Markets Portfolio's assets are allocated among countries in a manner
which does not reflect the relative size or valuation of the country's capital
market or a country's relative gross domestic product or population.
In constructing the portfolio of securities of the Emerging Markets
Portfolio, 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.
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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, futures contracts on stock indexes may be entered into for each
Portfolio. (See Appendix B on page 24 for more detail.)
For the same purpose, put and call options on stocks, stock indexes and
currencies may also be purchased for each Portfolio, although the current
intention is not to do so in such a manner that each put and call option type
would put more than 5% of a Portfolio's net assets at risk. Over-the-counter
options ("OTC Options") purchased are treated as not readily marketable. (See
"Investment Restrictions".)
The Investment Adviser on behalf of each Portfolio may enter into forward
foreign exchange contracts in order to protect the dollar value of all
investments in securities denominated in foreign currencies. The precise
matching of the forward contract amounts and the value of the securities
involved is not always 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.
Risk Factors
Foreign Investments. 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 each Portfolio 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.
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. 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 be more difficult to obtain and enforce a judgment
against a foreign company. Dividends and interest paid by foreign issuers may be
subject to withholding and other foreign taxes which may decrease the net return
on foreign investments as compared to dividends and interest paid to each of the
Funds by domestic companies.
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
Portfolio 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 often 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.
The foreign investments made for each Portfolio 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 Portfolio holds various foreign
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currencies from time to time, the value of the net assets of each Portfolio as
measured in U.S. dollars is affected favorably or unfavorably by changes in
exchange rates. Each Portfolio also incurs costs in connection with conversion
between various currencies.
Emerging Markets. Investments in securities of issuers in emerging markets
countries may involve a high degree of risk and many may be considered
speculative. Investments in developing and emerging markets may be subject to
potentially greater risks than those of other foreign issuers. These risks
include: (i) greater risks of expropriation, confiscatory taxation,
nationalization, and less social, political and economic stability; (ii) the
small current size of the markets for securities of emerging market issuers and
the currently low or non-existent volume of trading, which result in less
liquidity and in greater price volatility; (iii) certain national policies which
may restrict the Portfolio's investment opportunities, including restrictions on
investment in issuers or industries deemed sensitive to national interests; and
(iv) the absence of developed legal structures governing private or foreign
investments and private property.
Portfolio Brokerage
Each Portfolio 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 portfolio securities
(excluding short-term obligations) were replaced once in a period of one year.
For the period from April 1, 1995 (commencement of operations) to October 31,
1995 and the fiscal year ended October 31, 1996, the portfolio turnover rate of
the International Equity Portfolio was 23% and 36%, respectively. For the fiscal
year ending October 31, 1997 the portfolio turnover rate of the Emerging Markets
Portfolio is expected to be 80%. The amount of brokerage commissions and taxes
on realized capital gains to be borne by the shareholders of the Funds tends to
increase as the level of portfolio activity increases.
In effecting securities transactions 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 responsibility; the research and other information
provided by the broker; and the commissions charged. Accordingly, the
commissions charged by any such broker may be greater than the amount another
firm might charge if the Investment Adviser determines in good faith that the
amount of such commissions is reasonable in relation to the value of the
brokerage services and research information provided by such broker.
The Investment Adviser may direct a portion of each Portfolio's securities
transactions to certain unaffiliated brokers which in turn use a portion of the
commissions they receive from each Portfolio to pay other unaffiliated service
providers on behalf of the Portfolio for services provided for which the
Portfolio would otherwise be obligated to pay. Such commissions paid by each
Portfolio are at the same rate paid to other brokers for effecting similar
transactions in listed equity securities.
On those occasions when Brown Brothers Harriman & Co. deems the purchase or
sale of a security to be in the best interests of a Portfolio 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 the Portfolio 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 each
Portfolio. In some instances, this procedure might adversely affect a Portfolio.
Other Investment Techniques
Short-Term Instruments. The assets of each Portfolio may be invested in
non-U.S. dollar denominated and U.S. dollar denominated short-
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term instruments, including U.S. dollar denominated repurchase agreements. Cash
is held for each Portfolio in demand deposit accounts with the Portfolio's
custodian bank.
Government Securities. The assets of each Portfolio may be invested in
securities issued by the U.S. Government or sovereign foreign governments, their
agencies or instrumentalities. These securities include notes and bonds, zero
coupon bonds and stripped principal and interest securities.
Restricted Securities. Securities that have legal or contractual
restrictions on their resale may be acquired for a Portfolio. 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 reflects any limitation on their liquidity. (See
"Investment Restrictions".)
Loans of Portfolio Securities. Loans of portfolio securities up to 30% of
the total value of each Portfolio are permitted. These loans must be secured
continuously by cash or equivalent collateral or by an irrevocable letter of
credit in favor of the Portfolio at least equal at all times to 100% of the
market value of the securities loaned plus accrued income. By lending
securities, the Portfolio's income can be increased by its continuing to receive
income on the loaned securities as well as by the opportunity 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 Portfolio and its investors.
When-Issued and Delayed Delivery Securities. Securities may be purchased
for a Portfolio 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 Portfolio until
delivery and payment take place. At the time the commitment to purchase
securities 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 Portfolio's net asset value. Each Portfolio maintains with the
Custodian a separate account with a segregated portfolio of securities in an
amount at least equal to these commitments. 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 Portfolio 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 Portfolio may not be entered into if such
commitments exceed in the aggregate 15% of the market value of its total assets,
less liabilities other than the obligations created by when-issued or delayed
delivery commitments.
Foreign Currency Exchange Transactions. Because securities denominated in
currencies other than the U.S. dollar are bought and sold for each Portfolio,
and interest, dividends and sale proceeds are received by each Portfolio in
currencies other than the U.S. dollar, foreign currency exchange transactions
from time to time are entered into for each Portfolio to convert to and from
different foreign currencies and to convert foreign currencies to and from the
U.S. dollar. Foreign currency exchange 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).
Investment Company Securities. Subject to applicable statutory and
regulatory limitations, the assets of each Portfolio may be invested in shares
of other investment companies. Under the 1940 Act, the assets of each Portfolio
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 the Portfolio's total
assets would be so invested, (ii) 5% or less of the market value of the
Portfolio's total assets would
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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
the Portfolio. As a shareholder of another investment company, the Portfolio
would bear, along with other shareholders, its pro rata portion of the other
investment company's expenses, including advisory fees. These expenses would be
in addition to the advisory and other expenses that a Portfolio bears directly
in connection with its own operations.
INVESTMENT RESTRICTIONS
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The Statement of Additional Information for the Funds includes a listing of
the specific investment restrictions which govern the investment policies of
each Fund and each Portfolio. Certain of these investment restrictions are
deemed fundamental policies and may be changed only with the approval of the
holders of a "majority of the outstanding voting securities" (as defined in the
1940 Act) of the Fund or the Portfolio, as the case may be (see "Additional
Information" in this Prospectus), including a restriction that, excluding the
investment of all of a Fund's assets in an open-end investment company with
substantially the same investment objective, policies and restrictions as the
Fund, not more than 10% of the net assets of a Fund or its corresponding
Portfolio, as the case may be, may be invested in securities that are subject to
legal or contractual restrictions on resale.
Since the investment restrictions of each Fund correspond directly to those
of its Portfolio, the following is a discussion of the various investment
restrictions of each Portfolio.
As a non-fundamental policy, money is not borrowed by a Portfolio in an
amount in excess of 10% of its assets. It is intended that money will be
borrowed only from banks and only either to accommodate requests for the
withdrawal of part or all of an interest 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 Portfolio at any time at
which the amount of its borrowings exceed 5% of its assets.
As a non-fundamental policy of the International Equity Portfolio, at least
65% of the value of the total assets of the International Equity Portfolio is
invested in equity securities of companies based in countries in which it
invests. As a non-fundamental policy of the Emerging Markets Portfolio, at least
65% of the value of the total assets of the Emerging Markets Portfolio is
invested in equity securities based in emerging markets. For these purposes,
equity securities are defined as common stock, securities convertible into
common stock, rights and warrants, and include securities purchased directly and
in the form of American Depository Receipts, Global Depository Receipts or other
similar securities representing common stock of foreign-based companies.
In accordance with applicable regulations, a Portfolio 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 Portfolio's net assets would be represented by such investments.
Each Portfolio is classified as "non-diversified" under the 1940 Act, which
means that the Portfolio is not 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 a
Portfolio 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.
9
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PURCHASE OF SHARES
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Shares of the Funds are offered on a continuous basis at their net asset
value without a sales charge. The Corporation reserves the right to determine
the purchase orders for Fund shares that it will accept. Shares of the Funds may
be purchased on any day the New York Stock Exchange is open for regular trading
if the Corporation receives the purchase order and acceptable payment for such
order prior to 4:00 P.M., New York time. Purchases of Fund shares are then
executed at the net asset value per share next determined on that same day.
Shares are entitled to dividends declared, if any, starting as of the first
business day following the day a purchase order is executed on the books of the
Corporation.
An investor who has an account with an Eligible Institution (see page 15)
or a Financial Intermediary (see page 15) may place purchase orders for Fund
shares with the Corporation through that Eligible Institution or Financial
Intermediary which holds such shares in its name on behalf of that customer
pursuant to arrangements made between that customer and that Eligible
Institution or Financial Intermediary. Each Eligible Institution and each
Financial Intermediary may establish and amend from time to time a minimum
initial and a minimum subsequent purchase requirement for its customers. Each
Eligible Institution or Financial Intermediary arranges payment for Fund shares
on behalf of its customers. A transaction fee may be charged by an Eligible
Institution or a Financial Intermediary on the purchase of Fund shares.
An investor who does not have an account with an Eligible Institution or a
Financial Intermediary must place purchase orders for Fund shares with the
Corporation through the Funds' Shareholder Servicing Agent. Such an investor has
such shares held directly in the investor's name on the books of the Corporation
and is responsible for arranging for the payment of the purchase price of Fund
shares. All purchase orders for initial and subsequent purchases are executed at
the net asset value per share next determined after the Corporation's custodian,
State Street Bank and Trust Company, has received payment in the form of a
cashier's check drawn on a U.S. bank, a check certified by a U.S. bank or a wire
transfer. Brown Brothers Harriman & Co., as the Funds' Shareholder Servicing
Agent, has established a minimum initial purchase requirement for each Fund of
$100,000 and a minimum subsequent purchase requirement for each Fund of $25,000.
These minimum purchase requirements may be amended from time to time.
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., an Eligible Institution and the Funds' Shareholder
Servicing Agent. (See back cover for address and phone number.)
REDEMPTION OF SHARES
================================================================================
A redemption request 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. Shares continue to earn dividends declared, if any,
through the business day a redemption request is executed on the books of the
Corporation.
Shares held by an Eligible Institution or a Financial Intermediary on
behalf of a shareholder must be redeemed through that Eligible Institution or
Financial Intermediary pursuant to arrangements made between that shareholder
and Eligible Institution or Financial Intermediary. Proceeds of a redemption are
paid to that shareholder's account at that Eligible Institution or Financial
Intermediary on a date established by the Eligible Institution or Financial
Intermediary. A transaction fee may be charged by an Eligible Institution or
Financial Intermediary on the redemption of Fund shares.
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
10
<PAGE>
Agent. (See back cover for address and phone number.) Proceeds resulting from
such redemption are paid by the Corporation directly to the shareholder in
"available" funds generally on the next business day after the redemption
request is executed, and in any event within seven days.
Redemptions By the Corporation
The Funds' Shareholder Servicing Agent (see page 14), each Eligible
Institution and each Financial Intermediary (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. If such remaining shares are to be redeemed, the shareholder is so
notified and is allowed 60 days to make an additional investment to enable the
shareholder to meet the minimum requirement before the redemption is processed.
Brown Brothers Harriman & Co., as the Funds' Shareholder Servicing Agent, has
established a minimum account size of $25,000.
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 the
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 AND THE PORTFOLIOS
================================================================================
Directors, Trustees and Officers
The Corporation's Directors, in addition to supervising the actions of the
Administrator of the Corporation and Distributor, as set forth below, decide
upon matters of general policy with respect to the Corporation. The Portfolios'
Trustees, in addition to supervising the actions of the Portfolios' Investment
Adviser and Administrator, as set forth below, decide upon matters of general
policy with respect to each Portfolio. The Corporation's Directors are not the
same individuals as the Portfolios' Trustees.
Because of the services rendered to each Portfolio by the Investment
Adviser and to the Corporation and the Portfolios by their respective
Administrators, the Corporation and the Portfolios require no employees, and
their respective officers, other than the Chairmen, receive no compensation from
the Funds or the Portfolios. (See "Directors, Trustees 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
Vice Chairman-Finance and Operations of
The Interpublic Group of Companies
David P. Feldman
Chairman and Chief Executive Officer-AT&T
Investment Management Corporation
Alan G. Lowy
Private Investor
11
<PAGE>
Arthur D. Miltenberger
Vice President and Chief Financial Officer of
Richard K. Mellon and Sons
The Trustees of each Portfolio are:
H.B. Alvord
Retired, Former Treasurer and Tax Collector
of Los Angeles County
Richard L. Carpenter
Retired, Director of Internal Investments of
the Public School Employees' Retirement System
Clifford A. Clark
Retired, Former Senior Manager of Brown
Brothers Harriman & Co.
David M. Seitzman
Practicing Physician with Seitzman, Shuman,
Kwart and Phillips
Investment Adviser
The Investment Adviser to each Portfolio is Brown Brothers Harriman & Co.,
Private Bankers, a New York limited partnership established in 1818. The firm is
subject to examination and regulation by the Superintendent of Banks of the
State of New York and by the Department of Banking of the Commonwealth of
Pennsylvania. The firm is also subject to supervision and examination by the
Commissioner of Banks of the Commonwealth of Massachusetts.
Brown Brothers Harriman & Co. provides investment advice and portfolio
management services to each Portfolio. Subject to the general supervision of the
Portfolios' Trustees, Brown Brothers Harriman & Co. makes the day-to-day
investment decisions, places the purchase and sale orders for portfolio
transactions, and generally manages the investments of each Portfolio. Brown
Brothers Harriman & Co. provides a broad range of investment management services
for customers in the United States and abroad. At June 30, 1996, it managed
total assets of approximately $25 billion.
Each Portfolio is managed on a day-to-day basis by a team of individuals,
including Mr. John A. Nielsen, Ms. Camille M. Kelleher, Mr. A. Edward Allinson,
Mr. G. Scott Clemons, Mr. Paul J. Fraker and Mr. Ben Kottler. 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.
Ms. Kelleher holds a B.A. from Barnard College and a M.B.A. from Columbia
University. She joined Brown Brothers Harriman & Co. in 1984. Mr. Allinson holds
a B.A. and a M.B.A. from the University of Pennsylvania. He joined Brown
Brothers Harriman & Co. in 1991. Mr. Clemons holds a A.B. from Princeton
University. He joined Brown Brothers Harriman & Co. in 1990. Mr. Fraker holds a
B.A. from Carleton College and a M.A. from Johns Hopkins University. He joined
Brown Brothers Harriman & Co. in 1996. Mr. Kottler holds a B.A. from Durham
University. He joined Brown Brothers Harriman & Co. in 1996.
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 Agreement, Brown Brothers Harriman & Co. receives from the
International Equity Portfolio and the Emerging Markets Portfolio an annual fee,
computed daily and payable monthly, equal to 0.65% and 0.90%, respectively, of
the average daily net assets of that Portfolio. Brown Brothers Harriman & Co.
and its affiliates also receive annual administration fees from each Fund and
each Portfolio equal to 0.16% of the average daily net assets of that Fund or
that Portfolio, as the case may be. Brown Brothers Harriman & Co. also receives
an annual shareholder servicing/eligible institution fee from each Fund equal to
0.25% of the average daily net assets of that Fund represented by shares during
the period for whom Brown Brothers Harriman & Co. is the holder or agent of
record.
The investment advisory services of Brown Brothers Harriman & Co. to each
Portfolio are not exclusive under the terms of the Investment Advisory
Agreement. 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
12
<PAGE>
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".
Administrators
Brown Brothers Harriman & Co. acts as Administrator of the Corporation and
Brown Brothers Harriman Trust Company (Cayman) Limited acts as Administrator of
each Portfolio. (See "Administrators" in the Statement of Additional
Information.) Brown Brothers Harriman Trust Company (Cayman) Limited is a
wholly-owned subsidiary of Brown Brothers Harriman Trust Company of New York,
which is a wholly-owned subsidiary of Brown Brothers Harriman & Co.
In its capacity as Administrator of the Corporation, 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 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 0.125% of that Fund's average daily net assets.
Brown Brothers Harriman Trust Company (Cayman) Limited, in its capacity as
Administrator of each Portfolio, administers all aspects of the Portfolio's
operations subject to the supervision of the Portfolio's Trustees except as set
forth above under "Investment Adviser". In connection with its responsibilities
as Administrator for each Portfolio and at its own expense, Brown Brothers
Harriman Trust Company (Cayman) Limited (i) provides each Portfolio 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 Portfolio, including the maintenance of certain books and records,
receiving and processing requests for increases and decreases in the beneficial
interests in the Portfolio, notification to the Investment Adviser of available
funds for investment, reconciliation of account information and balances between
the Custodian and the Investment Adviser, and processing, investigating and
responding
13
<PAGE>
to investor inquiries; (ii) oversees the performance of administrative and
professional services to each Portfolio by others, including the Custodian;
(iii) provides each Portfolio 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 each Portfolio's registration
statement for filing with the Securities and Exchange Commission, and the
preparation of tax returns for each Portfolio and reports to investors and the
Securities and Exchange Commission.
For the services rendered to each Portfolio and related expenses borne by
Brown Brothers Harriman Trust Company (Cayman) Limited as Administrator of each
Portfolio, Brown Brothers Harriman Trust Company (Cayman) Limited receives from
each Portfolio an annual fee, computed daily and payable monthly, equal to
0.035% of that Portfolio'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.
Pursuant to a Subadministrative Services Agreement with Brown Brothers
Harriman Trust Company (Cayman) Limited, SFG-Cayman performs such
subadministrative duties for each Portfolio as are from time to time agreed upon
by the parties. The offices of SFG-Cayman are located at Elizabethan Square,
George Town, Grand Cayman BWI. SFG-Cayman is a wholly-owned subsidiary of SFG.
SFG-Cayman's subadministrative duties may include providing equipment and
clerical personnel necessary for maintaining the organization of each Portfolio,
participation in the preparation of documents required for compliance by each
Portfolio with applicable laws and regulations, preparation of certain documents
in connection with meetings of Trustees of and investors in each Portfolio, and
other functions that would otherwise be performed by the Administrator of each
Portfolio as set forth above. For performing such subadministrative services,
SFG-Cayman receives such compensation as is from time to time agreed upon, but
not in excess of the amount paid to the Administrator from the Portfolios.
Shareholder Servicing Agent
The Corporation has entered into a shareholder servicing agreement with
Brown Brothers Harriman & Co. pursuant to which Brown Brothers Harriman & Co.,
as agent for the Corporation with respect to the Funds, among other things:
answers inquiries from shareholders of and prospective investors in the Funds
regarding account status and history, the manner in which purchases and
redemptions of Fund shares may be effected and certain other matters pertaining
to the Funds; assists shareholders of and prospective investors in the Funds in
designating and changing dividend options, account designations and addresses;
and provides such other related services as the Corporation or a shareholder of
or prospective investor in the Funds may reasonably request. For these services,
Brown Brothers Harriman & Co. receives from each Fund an annual fee, computed
daily and payable monthly, equal to 0.25% of that Fund's average daily net
assets represented by shares owned during the period for which payment was being
made by shareholders who did not hold their account with an eligible
institution.
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<PAGE>
Financial Intermediaries
From time to time, the Funds' Shareholder Servicing Agent enters into
contracts with banks, brokers and other financial intermediaries ("Financial
Intermediaries") pursuant to which a customer of the Financial Intermediary may
place purchase orders for Fund shares through that Financial Intermediary which
holds such shares in its name on behalf of that customer. Pursuant to such
contract, each Financial Intermediary as agent with respect to shareholders of
and prospective investors in the Funds who are customers of that Financial
Intermediary, among other things: provides necessary personnel and facilities to
establish and maintain certain shareholder accounts and records enabling it to
hold, as agent, its customers' shares in its name or its nominee name on the
shareholder records of the Corporation; assists in processing purchase and
redemption transactions; arranges for the wiring of funds; transmits and
receives funds in connection with customer orders to purchase or redeem shares
of the Funds; provides periodic statements showing a customer's account balance
and, to the extent practicable, integrates such information with information
concerning other customer transactions otherwise effected with or through it;
furnishes, either separately or on an integrated basis with other reports sent
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, the Financial Intermediary
receives such fees from the Shareholder Servicing Agent as may be agreed upon
from time to time between the Shareholder Servicing Agent and such Financial
Intermediary.
Eligible Institutions
The Corporation enters into eligible institution agreements with banks,
brokers and other financial institutions pursuant to which each financial
institution, as agent for the Corporation with respect to shareholders of and
prospective investors in the Funds who are customers with that financial
institution, among other things: provides necessary personnel and facilities to
establish and maintain certain shareholder accounts and records enabling it to
hold, as agent, its customer's shares in its name or its nominee name on the
shareholder records of the Corporation; assists in processing purchase and
redemption transactions; arranges for the wiring of funds; transmits and
receives funds in connection with customer orders to purchase or redeem shares
of the Funds; provides periodic statements showing a customer's account balance
and, to the extent practicable, integrates such information with information
concerning other customer transactions otherwise effected with or through it;
furnishes, either separately or on an integrated basis with other reports sent
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, each financial institution
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 each
financial institution was the holder or agent of record.
Expense Payment Agreement
Under separate agreements dated August 23, 1994 and April 10, 1997,
respectively, Brown Brothers Harriman Trust Company (Cayman) Limited pays the
expenses of the International Equity Portfolio and the Emerging Markets
Portfolio, other than fees paid to Brown Brothers Harriman & Co. under the
Trust's Administration Agreement and other than expenses relating to the
organization of each Portfolio. In return, Brown Brothers Harriman Trust Company
(Cayman) Limited receives a fee from the International Equity Portfolio and the
Emerging Markets Portfolio such that after such payment the aggregate expenses
15
<PAGE>
of each Portfolio do not exceed an agreed upon annual rate, currently 0.90% and
1.25%, respectively, of the average daily net assets of that Portfolio. Such
fees are computed daily and paid monthly.
Distributor
59 Wall Street Distributors acts as exclusive Distributor of shares of the
Funds. 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 for
the Funds and the Portfolios and Transfer and Dividend Disbursing Agent for the
Funds.
As Custodian for each Fund, it is responsible for holding each Fund's
assets (i.e., cash and that Fund's interest in its respective Portfolio)
pursuant to a custodian agreement with the Corporation. Cash is held for each
Fund in demand deposit accounts at the Custodian. Subject to the supervision of
the Administrator of the Corporation, the Custodian maintains the accounting
records for each Fund and each day computes the net asset value per share of
each Fund. As Transfer and Dividend Disbursing Agent it is responsible for
maintaining the books and records detailing the ownership of each Fund's shares.
As Custodian for each Portfolio, it is responsible for maintaining books
and records of portfolio transactions and holding each Portfolio's securities
and cash pursuant to a custodian agreement with each Portfolio. Cash is held for
each Portfolio in demand deposit accounts at the Custodian. Subject to the
supervision of the Administrator of each Portfolio, the Custodian maintains the
accounting and portfolio transaction records for each Portfolio and each day
computes the net asset value and net income of each Portfolio.
Independent Auditors
Deloitte & Touche LLP, Boston, Massachusetts are the independent auditors
for the Funds. Deloitte & Touche, Grand Cayman are the independent auditors for
the Portfolios.
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 (i.e., the value of its
investment in a Portfolio and other 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 each Fund's investment in its respective Portfolio is also
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 the value of each Fund's investment in its respective
Portfolio is made by subtracting from the value of the total assets of a
Portfolio the amount of a Portfolio's liabilities and multiplying the difference
by the percentage, effective for that day, which represents that Fund's share of
the aggregate beneficial interests in its respective Portfolio.
Values of assets held by each Portfolio are determined on the basis of
their market or other fair value. (See "Determination of Net Asset Value;
Redemption in Kind" in the Statement of Additional Information.)
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<PAGE>
DIVIDENDS AND DISTRIBUTIONS
================================================================================
Substantially all of each Fund's net investment income ("Net Income"),
including its pro rata share of its corresponding Portfolio's net income and
realized net short-term capital gains in excess of net long-term capital losses
is declared and paid to the Fund's shareholders at least annually as a dividend,
and substantially all of the Fund's pro rata share of its corresponding
Portfolio's realized net long-term capital gains in excess of net short-term
capital losses is declared and paid to the Fund's 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 each Fund. (See "Taxes" below.)
Dividends and capital gains distributions are payable to each Fund's
shareholders of record on the record date.
Unless a shareholder whose shares are held directly in the shareholder's
name on the books of the Corporation elects to have dividends and capital gains
distributions paid in cash, 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.
Each Eligible Institution and each Financial Intermediary may establish its
own policy with respect to the reinvestment of dividends and capital gains
distributions in additional Fund 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. Accordingly, the Funds are
not subject to federal income taxes on their Net Income and realized net
long-term capital gains in excess of net short-term capital losses that are
distributed to their shareholders. A 4% non-deductible excise tax is imposed on
a Fund to the extent that certain distribution requirements for that Fund for
each calendar year are not met. The Corporation intends to continue to meet such
requirements. The Portfolios are also not required to pay any federal income or
excise taxes.
Dividends are taxable to shareholders of a Fund as ordinary income, whether
such dividends are paid in cash or reinvested in additional shares. Dividends
paid from the Funds are not eligible for the dividends-received deduction
allowed to corporate shareholders because the Net Income of each Portfolio 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 is
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.
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<PAGE>
The Funds may be subject to foreign withholding taxes and if more than 50%
of the value of a Fund's share of a Portfolio'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 a 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 Internal Revenue Code, as amended, 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.
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 $0.001 per share, of which
25,000,000 shares have been classified as shares of the International Equity
Fund and 25,000,000 shares have been classified as shares of the Emerging
18
<PAGE>
Markets Fund. The Board of Directors of the Corporation may increase the number
of shares the Corporation is authorized to issue without the approval of
shareholders. The Board of Directors of the Corporation 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
five 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 of the Corporation 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 of the
Corporation 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 of the Corporation. Shareholders
also have the right to remove one or more Directors of the Corporation 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, each Eligible Institution may vote any shares as to
which that Eligible Institution 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 that Eligible Institution is the
agent of record. Any shares so voted by an Eligible Institution are deemed
represented at the meeting for purposes of quorum requirements.
Each Portfolio is organized as a trust under the law of the State of New
York. Each Portfolio's Declaration of Trust provides that each corresponding
Fund and other entities investing in the Portfolio (e.g., other investment
companies, insurance company separate accounts and common and commingled trust
funds) are liable for all obligations of the Portfolio. However, the risk of a
Fund incurring financial loss on account of such liability is limited to
circumstances in which both inadequate insurance existed and the Portfolio
itself was unable to meet its obligations. Accordingly, the Directors of the
Corporation believe that neither Fund nor its shareholders will be adversely
affected by reason of the investment of all of the Fund's assets in its
corresponding Portfolio.
Each investor in a Portfolio, including each Fund, may add to or reduce its
investment in a Portfolio on each day the New York Stock Exchange is open for
regular trading. At 4:00 P.M., New York time on each such business day, the
value of each investor's beneficial interest in a Portfolio is determined by
multiplying the net asset value of the Portfolio by the percentage, effective
for that day, which represents that investor's share of the aggregate beneficial
interests in the Portfolio. Any additions or withdrawals, which are to be
effected on that day, are then effected. The investor's percentage of the
aggregate beneficial interests in the Portfolio is then recomputed as the
percentage equal to the fraction (i) the numerator of which is the value of such
investor's investment in the Portfolio as of 4:00 P.M., New York time on such
day
19
<PAGE>
plus or minus, as the case may be, the amount of any additions to or withdrawals
from the investor's investment in the Portfolio effected on such day, and (ii)
the denominator of which is the aggregate net asset value of the Portfolio as of
4:00 P.M., New York time on such day plus or minus, as the case may be, the
amount of the net additions to or withdrawals from the aggregate investments in
the Portfolio by all investors in the Portfolio. The percentage so determined is
then applied to determine the value of the investor's interest in the Portfolio
as of 4:00 P.M., New York time on the following business day of the Portfolio.
Whenever the Corporation is requested to vote on a matter pertaining to a
Portfolio, the Corporation will vote its shares without a meeting of
shareholders of the corresponding Fund if the proposal is one, if which made
with respect to the Fund, would not require the vote of shareholders of the
Fund, as long as such action is permissible under applicable statutory and
regulatory requirements. For all other matters requiring a vote, the Corporation
will hold a meeting of shareholders of the Fund and, at the meeting of investors
in the Portfolio, the Corporation will cast all of its votes in the same
proportion as the votes of the Fund's shareholders even if all Fund shareholders
did not vote. Even if the Corporation votes all its shares at a Portfolio
meeting, other investors with a greater pro rata ownership in the Portfolio
could have effective voting control of the operations of the Portfolio.
ADDITIONAL INFORMATION
================================================================================
As used in this Prospectus, the term "majority of the outstanding voting
securities" (as defined in the 1940 Act) currently means the vote of (i) 67% or
more of the outstanding voting securities present at a meeting, if the holders
of more than 50% of the outstanding voting securities are present in person or
represented by proxy; or (ii) more than 50% of the outstanding voting
securities, whichever is less.
Each Fund's shareholders receive semi-annual reports containing unaudited
financial statements and annual reports containing financial statements audited
by independent auditors. The annual report also contains performance information
and is made available to investors upon request and without charge.
Other mutual funds or institutional investors may invest in each Portfolio
on the same terms and conditions as each Fund. However, these other investors
may have different sales commissions and other operating expenses which may
generate different aggregate performance results. Information concerning other
investors in each Portfolio is available from Brown Brothers Harriman & Co. (See
the back cover for the address and phone number.)
The Corporation may withdraw a Fund's investment in its corresponding
Portfolio as a result of certain changes in the Portfolio's investment
objective, policies or restrictions or if the Board of Directors of the
Corporation determines that it is otherwise in the best interests of the Fund to
do so. Upon any such withdrawal, the Board of Directors of the Corporation would
consider what action might be taken, including the investment of all of the
assets of the Fund in another pooled investment entity or the retaining of an
investment adviser to manage the Fund's assets in accordance with the Fund's
investment policies. In the event the Directors of the Corporation were unable
to accomplish either, the Directors will determine the best course of action.
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 each Fund's
investment results and/or comparisons of its investment results to various
unmanaged indexes (such as the MSCI-EAFE Index, MSCI-Emerging Markets Index and
IFC Emerging Markets Investable Index) and to investments for which reliable
20
<PAGE>
performance data is available. Performance information may also include
comparisons to averages, performance rankings or other information prepared by
recognized mutual fund statistical services. To the extent that unmanaged
indexes are so included, the same indexes are used on a consistent basis. Each
Fund's investment results as used in such communications are calculated on a
total rate of return basis in the manner set forth below.
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.
Historical performance information for any period or portion thereof prior
to the establishment of the International Equity Fund will be that of the
International Equity Portfolio, adjusted to assume that all charges, expenses
and fees of the Fund and the Portfolio which are presently in effect were
deducted during such periods, as permitted by applicable SEC staff
interpretations.
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.
21
<PAGE>
APPENDIX A - INTERNATIONAL STATISTICS
================================================================================
<TABLE>
<CAPTION>
Market Gross Domestic
Capitalization Product Population
------------------- ------------------ -------------------
Dollars % of Dollars % of % of
MARKETS -- DEVELOPED (Billions) Total (Billions) Total (Millions) Total
- ---------------------- -------- ------ --------- ----- --------- -----
<S> <C> <C> <C> <C> <C> <C>
Japan........................ 2,663 25.5 4,149 23.2 125.2 3.0
United Kingdom............... 1,590 15.2 1,200 6.7 58.3 1.4
Germany...................... 667 6.4 2,241 12.5 81.6 1.9
France....................... 540 5.2 1,473 8.2 58.0 1.4
Hong Kong.................... 449 4.3 143 0.8 6.3 0.1
Netherlands.................. 426 4.1 365 2.0 15.4 0.4
Switzerland.................. 399 3.8 268 1.5 7.0 0.2
Malaysia..................... 282 2.7 84 0.5 20.1 0.5
Australia.................... 266 2.5 374 2.1 18.1 0.4
Singapore.................... 256 2.5 86 0.5 3.0 0.1
Italy........................ 254 2.4 1,072 6.0 57.2 1.4
Sweden....................... 222 2.1 237 1.3 8.8 0.2
Spain........................ 181 1.7 538 3.0 39.2 0.9
Belgium...................... 117 1.1 247 1.4 10.1 0.2
Denmark...................... 66 0.6 164 0.9 5.2 0.1
Finland...................... 62 0.6 118 0.7 5.1 0.1
Norway....................... 53 0.5 144 0.8 4.4 0.1
New Zealand.................. 36 0.3 64 0.4 3.5 0.1
Austria...................... 35 0.3 216 1.2 8.5 0.2
Ireland...................... 31 0.3 64 0.4 3.6 0.1
----- ----- ------ ---- ----- ----
SUBTOTAL - DEVELOPED...... 8,595 82.4 34,247 74.0 538.6 12.7
----- ----- ------ ---- ----- ----
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Market Gross Domestic
Capitalization Product Population
------------------- ------------------ -------------------
Dollars % of Dollars % of % of
MARKETS -- EMERGING (Billions) Total (Billions) Total (Millions) Total
- ------------------ -------- ------ --------- ----- --------- -----
<S> <C> <C> <C> <C> <C> <C>
Taiwan....................... 312 3.0 261 1.5 21.3 0.5
South Africa................. 230 2.2 90 0.5 41.2 1.0
Brazil....................... 219 2.1 721 4.0 155.8 3.7
Korea........................ 139 1.3 416 2.3 44.9 1.1
India........................ 125 1.2 264 1.5 935.7 22.1
Mexico....................... 110 1.1 279 1.6 90.5 2.1
Thailand..................... 96 0.9 162 0.9 59.4 1.4
Indonesia.................... 91 0.9 192 1.1 193.8 4.6
Pakistan..................... 85 0.8 47 0.3 129.8 3.1
Chile........................ 72 0.7 67 0.4 14.2 0.3
Philippines.................. 57 0.5 73 0.4 70.3 1.7
Argentina.................... 44 0.4 286 1.6 34.8 0.8
Israel....................... 36 0.3 87 0.5 57.2 1.4
Turkey....................... 35 0.3 165 0.9 61.6 1.5
Portugal..................... 31 0.3 89 0.5 9.9 0.2
Greece....................... 24 0.2 108 0.6 10.5 0.2
Czech Republic............... 20 0.2 46 0.3 10.3 0.2
Venezuela.................... 18 0.2 51 0.3 21.6 0.5
Colombia..................... 17 0.2 79 0.4 35.1 0.8
Peru......................... 14 0.1 59 0.3 23.5 0.6
Egypt........................ 12 0.1 57 0.3 59.0 1.4
Poland....................... 8 0.1 121 0.7 38.6 0.9
Morocco...................... 8 0.1 33 0.2 27.1 0.6
Luxembourg................... 6 0.1 17 0.1 0.4 0.0
Hungary...................... 5 0.0 45 0.2 10.2 0.2
China........................ 5 0.0 702 3.9 1,211.5 28.6
Jordan....................... 5 0.0 6 0.0 5.4 0.1
Zimbabwe..................... 4 0.0 6 0.0 11.5 0.3
Tunisia...................... 4 0.0 18 0.1 8.9 0.2
Bangladesh................... 2 0.0 28 0.2 120.4 2.8
Sri Lanka.................... 2 0.0 12 0.1 18.4 0.4
Kenya........................ 2 0.0 8 0.0 30.5 0.7
Nigeria...................... 2 0.0 42 0.2 111.7 2.6
Ghana........................ 1 0.0 6 0.0 17.5 0.4
Slovenia..................... 0.5 0.0 14 0.1 2.0 0.0
Botswana..................... 0.3 0.0 4 0.0 1.5 0.0
-------- ----- ------ ---- ------ ----
SUBTOTAL - EMERGING....... 1,841.8 17.6 4,661 26.0 3,696 87.3
-------- ----- ------ ---- ------ ----
TOTAL - WORLD................ 10,436.8 100 17,908 100 4,234.6 100
======== ===== ====== ==== ====== ====
</TABLE>
Sources:
Market Capitalization: Datastream (as of December 1996)
GDP/Population: International Monetary Fund:
International Financial Statistics (February 1997).
International Finance Corporation: Emerging Stock Markets Factbook (1996).
23
<PAGE>
APPENDIX B - HEDGING STRATEGIES
================================================================================
Futures Contracts on Stock Indexes. 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, futures contracts
on stock indexes ("Futures Contracts") may be entered into for the Portfolios.
In order to assure that a Portfolio is not deemed a "commodity pool" for
purposes of the Commodity Exchange Act, regulations of the Commodity Futures
Trading Commission ("CFTC") require that each Portfolio 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 a
Portfolio's assets.
Futures Contracts provide 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
Portfolio or adversely affect the prices of securities which are intended to be
purchased at a later date. 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 would rise in value by an amount which
approximately offsets the decline in value of the portion of a Portfolio'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 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 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. 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 each Portfolio enters into a Futures Contract, it is initially
required to deposit, 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 Portfolio may be required to make subsequent deposits of cash
or eligible securities called "variation margin", with its futures contract
clearing broker, which are reflective of price fluctuations in the Futures
Contract.
24
<PAGE>
Currently, investments in Futures Contracts on non-U.S. stock indexes by
U.S. investors, such as the Portfolios, can be purchased on such non-U.S. stock
indexes as the Osaka Stock Exchange (OSE), Tokyo Stock Exchange (TSE), Hong Kong
Futures Exchange (HKFE), Singapore International Monetary Exchange (SIMEX),
London International Financial Futures and Options Exchange (LIFFE), Marche
Terme International de France (MATIF), Sydney Futures Exchange Ltd. (SFE), Meff
Sociedad Rectora de Productos Financieros Derivados de Renta Variable, S.A.
(MEFF RENTA VARIABLE), Deutsche Terminborse (DTB), Italian Stock Exchange (ISE),
Financiele Termijnmarkt Amsterdam (FTA), and London Securities and Derivatives
Exchange, Ltd. (OMLX).
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 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 a
Portfolio seeks a hedge.
25
<PAGE>
The 59 Wall Street Fund, Inc.
Investment Adviser and
Administrator of the Corporation
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 any 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.
