- --------------------------------------------------------------------------------
[graphic] ADVISOR CLASS SHARES February 17, 2000
- --------------------------------------------------------------------------------
SUPPLEMENT
TO THE MAY 1, 1999 PROSPECTUS
This supplement provides new and additional information beyond that contained
in the prospectus, and should be read in conjunction with such prospectus.
Capitalized terms not defined herein should have the meanings set forth in the
prospectus.
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ACCESSOR FUNDS, INC. [logo]
- --------------------------------------------------------------------------------
On February 4, 2000, the Board of Directors of Accessor Funds, Inc. ("Accessor
Funds") approved the replacement of Geewax, Terker & Co. ("Geewax Terker") as
money manager of the Growth Fund. The Board of Directors, including all of the
Directors who are not "interested persons" of Accessor Funds, have approved the
appointment of Chicago Equity Partners ("Chicago Equity Partners") as the money
manager of the Growth Fund, effective May 1, 2000. The appointment of Chicago
Equity Partners will not require shareholder approval. This procedure for adding
or replacing money managers was approved by the Portfolio's shareholders at a
Special Meeting of Shareholders held on August 15, 1995, and was authorized by
an exemptive order issued to Accessor Funds by the Securities and Exchange
Commission on September 4, 1996.
The Money Manager Agreement among Accessor Capital Management LP ("Accessor
Capital"), Accessor Funds and Chicago Equity Partners relating to the Growth
Fund is substantially similar to that between Accessor Capital, Accessor Funds
and Geewax Terker. Specifically, the fees paid to Chicago Equity Partners are
based on the same fee schedule as that of Geewax Terker. The duties to be
performed under this Money Manager Agreement are similar, and the standard of
care and termination provisions of the agreement are identical to other Money
Manager Agreements with other money managers of Accessor Funds. The Money
Manager Agreement with Geewax Terker will remain in effect until April 28, 2000.
Beginning May 1, 2000, Chicago Equity Partners will make investment decisions
for the assets of the Growth Fund allocated to it by Accessor Capital, and
continuously review, supervise, and administer the Growth Fund's investment
program with respect to these assets. Chicago Equity Partners is independent of
Accessor Capital and discharges its responsibilities subject to Accessor
Capital's and the Board of Directors' supervision and in a manner consistent
with the Growth Fund's investment objective, policies and limitations.
In connection with the appointment of Chicago Equity Partners as the money
manager of the Growth Fund, the following language is inserted in the following
sections of the Advisor Class Prospectus:
On page 1, the following is added to the Summary and replaces the second and
third paragraphs in their entirety:
The Fund invests primarily in stocks of companies chosen from the S&P 500 that
Chicago Equity Partners ("Chicago Equity Partners"), the Fund's Money Manager,
believes will outperform peer companies, while maintaining an overall risk level
similar to that of the benchmark. The Money Manager attempts to exceed the
performance of the S&P 500/BARRA Growth Index over a cycle of five years.
Chicago Equity Partners uses a disciplined structured investment approach and
quantitative analytical techniques designed to identify stocks with the highest
probability of outperforming their peers coupled with a portfolio construction
process designed to keep the overall portfolio risk characteristics similar to
that of the benchmark.
On page 20, the following replaces Management, Organization and Capital
Structure -- Growth Fund in its entirety:
Money Manager Chicago Equity Partners, 231 South LaSalle Street, Chicago,
Illinois 60697
Chicago Equity Partners utilizes a team approach to managing portfolios. David
Johnson is the Senior Portfolio manager responsible for the day to day
management of the Fund. Mr. Johnson has been with Chicago Equity Partners and
its predecessors for over 23 years.
For the first five calendar quarters of management of the Growth Fund, Chicago
Equity Partners, will earn a management fee of 0.20% that consists of a basic
fee of 0.10% and a portfolio management fee of 0.10%.
Prior to Chicago Equity Partners, Geewax, Terker & Company was the money manager
of the Growth Fund. The former money manager managed the Fund from July 27, 1997
until April 28, 2000. Geewax Terker earned a management fee calculated and paid
quarterly that consisted of a basic fee and a performance fee. This is the same
fee structure that Chicago Equity Partners will earn once it has completed five
complete calendar quarters. Beginning with the sixth calendar quarter of
management by Chicago Equity Partners, the basic fee will be equal to an annual
rate of 0.10 % of the Growth Fund's average daily net assets. The performance
fee for any quarter depends on the percentage amount by which the Growth Fund's
performance exceeds or trails that of the S&P 500/BARRA Growth Index during the
applicable measurement period based on the following schedule:
<TABLE>
<CAPTION>
Average Annual Performance Total
Differential vs. Annual Annual
Basic Fee Benchmark Index Performance Fee Fee
--------- --------------- --------------- ---
<S> <C> <C> <C>
0.10% Greater Than or Equal to 2.00% 0.22% 0.32%
Greater Than or Equal to 1.00% and Less Than 2.00% 0.20% 0.30%
Greater Than or Equal to 0.50% and Less Than 1.00% 0.15% 0.25%
Greater Than or Equal to 0.00% and Less Than 0.50% 0.10% 0.20%
Greater Than or Equal to -0.50% and Less Than 0.00% 0.05% 0.15%
Less Than -0.50% 0.00% 0.10%
</TABLE>
During the period from the sixth calendar quarter through the 13th calendar
quarter of Chicago Equity Partners management of the Growth Fund, the applicable
measurement period will be the entire period since the commencement of its
management of the Growth Fund with the exception of the quarter immediately
preceding the date of calculation. Commencing with the 14th quarter of Chicago
Equity Partners management of the Growth Fund, the applicable measurement period
will consist of the 12 most recent calendar quarters, except for the quarter
immediately preceding the date of calculation.
<PAGE>
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[GRAPHIC] INVESTOR CLASS SHARES February 17, 2000
- --------------------------------------------------------------------------------
SUPPLEMENT
TO THE MAY 1, 1999 PROSPECTUS
This supplement provides new and additional information beyond that contained
in the prospectus, and should be read in conjunction with such prospectus.
Capitalized terms not defined herein should have the meanings set forth in the
prospectus.
- --------------------------------------------------------------------------------
ACCESSOR FUNDS, INC. [logo]
- --------------------------------------------------------------------------------
On February 4, 2000, the Board of Directors of Accessor Funds, Inc. ("Accessor
Funds") approved the replacement of Geewax, Terker & Co. ("Geewax Terker") as
money manager of the Growth Fund. The Board of Directors, including all of the
Directors who are not "interested persons" of Accessor Funds, have approved the
appointment of Chicago Equity Partners ("Chicago Equity Partners") as the money
manager of the Growth Fund, effective May 1, 2000. The appointment of Chicago
Equity Partners will not require shareholder approval. This procedure for adding
or replacing money managers was approved by the Portfolio's shareholders at a
Special Meeting of Shareholders held on August 15, 1995, and was authorized by
an exemptive order issued to Accessor Funds by the Securities and Exchange
Commission on September 4, 1996.
The Money Manager Agreement among Accessor Capital Management LP ("Accessor
Capital"), Accessor Funds and Chicago Equity Partners relating to the Growth
Fund is substantially similar to that between Accessor Capital, Accessor Funds
and Geewax Terker. Specifically, the fees paid to Chicago Equity Partners are
based on the same fee schedule as that of Geewax Terker. The duties to be
performed under this Money Manager Agreement are similar, and the standard of
care and termination provisions of the agreement are identical to other Money
Manager Agreements with other money managers of Accessor Funds. The Money
Manager Agreement with Geewax Terker will remain in effect until April 28, 2000.
Beginning May 1, 2000, Chicago Equity Partners will make investment decisions
for the assets of the Growth Fund allocated to it by Accessor Capital, and
continuously review, supervise, and administer the Growth Fund's investment
program with respect to these assets. Chicago Equity Partners is independent of
Accessor Capital and discharges its responsibilities subject to Accessor
Capital's and the Board of Directors' supervision and in a manner consistent
with the Growth Fund's investment objective, policies and limitations.
In connection with the appointment of Chicago Equity Partners as the money
manager of the Growth Fund, the following language is inserted in the following
sections of the Investor Class Prospectus:
On page 1, the following is added to the Summary and replaces the second and
third paragraphs in their entirety:
The Fund invests primarily in stocks of companies chosen from the S&P 500 that
Chicago Equity Partners ("Chicago Equity Partners"), the Fund's Money Manager,
believes will outperform peer companies, while maintaining an overall risk level
similar to that of the benchmark. The Money Manager attempts to exceed the
performance of the S&P 500/BARRA Growth Index over a cycle of five years.
Chicago Equity Partners uses a disciplined structured investment approach and
quantitative analytical techniques designed to identify stocks with the highest
probability of outperforming their peers coupled with a portfolio construction
process designed to keep the overall portfolio risk characteristics similar to
that of the benchmark.
On page 20, the following replaces Management, Organization and Capital
Structure -- Growth Fund in its entirety:
Money Manager Chicago Equity Partners, 231 South LaSalle Street, Chicago,
Illinois 60697
Chicago Equity Partners utilizes a team approach to managing portfolios. David
Johnson is the Senior Portfolio manager responsible for the day to day
management of the Fund. Mr. Johnson has been with Chicago Equity Partners and
its predecessors for over 23 years.
For the first five calendar quarters of management of the Growth Fund, Chicago
Equity Partners, will earn a management fee of 0.20% that consists of a basic
fee of 0.10% and a portfolio management fee of 0.10%.
Prior to Chicago Equity Partners, Geewax, Terker & Company was the money manager
of the Growth Fund. The former money manager managed the Fund from July 27, 1997
until April 28, 2000. Geewax Terker earned a management fee calculated and paid
quarterly that consisted of a basic fee and a performance fee. This is the same
fee structure that Chicago Equity Partners will earn once it has completed five
complete calendar quarters. Beginning with the sixth calendar quarter of
management by Chicago Equity Partners, the basic fee will be equal to an annual
rate of 0.10 % of the Growth Fund's average daily net assets. The performance
fee for any quarter depends on the percentage amount by which the Growth Fund's
performance exceeds or trails that of the S&P 500/BARRA Growth Index during the
applicable measurement period based on the following schedule:
<TABLE>
<CAPTION>
Average Annual Performance Total
Differential vs. Annual Annual
Basic Fee Benchmark Index Performance Fee Fee
--------- --------------- --------------- ---
<S> <C> <C> <C>
0.10% Greater Than or Equal to 2.00% 0.22% 0.32%
Greater Than or Equal to 1.00% and Less Than 2.00% 0.20% 0.30%
Greater Than or Equal to 0.50% and Less Than 1.00% 0.15% 0.25%
Greater Than or Equal to 0.00% and Less Than 0.50% 0.10% 0.20%
Greater Than or Equal to -0.50% and Less Than 0.00% 0.05% 0.15%
Less Than -0.50% 0.00% 0.10%
</TABLE>
During the period from the sixth calendar quarter through the 13th calendar
quarter of Chicago Equity Partners management of the Growth Fund, the applicable
measurement period will be the entire period since the commencement of its
management of the Growth Fund with the exception of the quarter immediately
preceding the date of calculation. Commencing with the 14th quarter of Chicago
Equity Partners management of the Growth Fund, the applicable measurement period
will consist of the 12 most recent calendar quarters, except for the quarter
immediately preceding the date of calculation.
================================================================================
DISTRIBUTION AND SERVICE PLAN
================================================================================
On February 15, 2000, the Board of Directors of Accessor Funds, Inc. ("Accessor
Funds") terminated the Shareholder Service Plan of the Investor Class Shares of
Accessor Funds. The Board also amended the Distribution Plan, which they renamed
the Distribution and Service Plan, to incorporate any payments and services
previously made under the Shareholder Service Plan. The termination of the
Shareholder Service Plan and the amendment of the Distribution and Service Plan
will not increase the cost of distribution and shareholder services to the
Investor Class Shares, which will not exceed 0.25% annually of the Investor
Class assets. The Directors also approved technical, conforming amendments to
Accessor Fund's Rule 18f-3 Plan and the other related agreements.
In connection with the termination of the Shareholder Service Plan and the
amendment of the Distribution and Service Plan, the following language replaces
the section entitled "Distribution, Shareholder Service and Administrative
Services Arrangements" in the Investor Class Prospectus in its entirety:
DISTRIBUTION AND SERVICE PLAN AND ADMINISTRATIVE SERVICES PLAN
Accessor Funds has adopted a Distribution and Service Plan that allows the
Investor Class Shares of the Fund to pay financial intermediaries for sales and
distribution-related activities and for providing non-distribution related
shareholder services. The fee under the Distribution and Service Plan will not
exceed 0.25% in the aggregate annually of the Investor Class assets.
Accessor Funds has also adopted an Administrative Services Plan which allows the
Investor Class Shares of the Fund to pay financial intermediaries for
non-distribution related administrative services provided to shareholders. The
administrative services fees will not exceed 0.25% annually of the Investor
Class assets.
<PAGE>
ACCESSOR(R) FUNDS, INC.
1420 Fifth Avenue, Suite 3600
Seattle, WA 98101
(206) 224-7420/(800) 759-3504
Supplement dated February 17, 2000 to
Statement of Additional Information
Dated May 1, 1999
THIS SUPPLEMENT PROVIDES NEW AND ADDITIONAL INFORMATION BEYOND THAT CONTAINED IN
THE STATEMENT OF ADDITIONAL INFORMATION, AND SHOULD BE READ IN CONJUNCTION WITH
SUCH STATEMENT OF ADDITIONAL INFORMATION. CAPITALIZED TERMS NOT DEFINED HEREIN
SHOULD HAVE THE MEANINGS SET FORTH IN THE STATEMENT OF ADDITIONAL INFORMATION.
On February 4, 2000, the Board of Directors of Accessor Funds, Inc. (the "Fund")
approved the replacement of Geewax, Terker & Company ("Geewax Terker") as money
manager of the Growth Fund of Accessor Funds. The Board of Directors, including
all of the Directors who are not "interested persons" of Accessor Funds, have
approved the appointment of Chicago Equity Partners ("Chicago Equity Partners")
as the money manager of the Growth Fund, May 1, 2000. The appointment of Chicago
Equity Partners will not require shareholder approval. This procedure for adding
or replacing money managers was approved by the Portfolio's shareholders at a
Special Meeting of Shareholders held on August 15, 1995, and was authorized by
an exemptive order issued to Accessor Funds by the Securities and Exchange
Commission on September 4, 1996.
The Money Manager Agreement among Accessor Capital Management LP ("Accessor
Capital"), Accessor Funds and Chicago Equity Partners relating to the Growth
Fund is substantially similar to that between Accessor Capital, Accessor Funds
and Geewax Terker. Specifically, the fees paid to Chicago Equity Partners are
based on the same fee schedule as that of Geewax Terker. The duties to be
performed under this Money Manager Agreement are similar, and the standard of
care and termination provisions of the agreement are identical to other Money
Manager Agreements with other money managers of Accessor Funds. The Money
Manager Agreement with Geewax Terker will remain in effect until April 28, 2000.
Beginning May 1, 2000, Chicago Equity Partners will make investment decisions
for the assets of the Growth Fund allocated to it by Accessor Capital, and
continuously review, supervise, and administer the Growth Fund's investment
program with respect to these assets. Chicago Equity Partners is independent of
Accessor Capital and discharges its responsibilities subject to Accessor
Capital's and the Board of Directors' supervision and in a manner consistent
with the Growth Fund's investment objective, policies and limitations.
In connection with the appointment of Chicago Equity Partners as the money
manager of the Growth Fund, the following language is inserted in the following
sections of the Statement of Additional Information:
On page B-29, the following is added to the end of the last complete paragraph:
A new Money Manager Agreement for the Growth Fund was approved by the Board of
Directors, including all the Directors who are not "interested persons" of
Accessor Funds and who have no direct or indirect interest in the Money Manager
Agreement, on February 4, 2000, in connection with the change of Money Manager
to Chicago Equity Partners.
On page B-30, the following replaces in its entirety the paragraph entitled
"Geewax, Terker & Company":
Chicago Equity Partners Corporation ("Chicago Equity Partners"), a Delaware
Corporation and wholly owned subsidiary of Bank of America, is the Money
Manager for the Growth Portfolio. The Money Manager expects to maintain a
well-diversified portfolio of stocks in the Growth Portfolio, holding
market representation in all major economic sectors. Chicago Equity
Partners uses a disciplined, structured investment process to identify
stocks that have a higher probability of outperforming peer companies.
These stocks tend to have strong earnings growth and trade at reasonable
multiple as compared to their peers. Once the highest ranked stocks are
identified, Chicago Equity Partners builds portfolios that resemble the
benchmark in terms of major risk components like industry and sector weight
and market capitalization. As of December 31, 1999, Chicago Equity Partners
managed assets of approximately $9.9 billion. Until April 28, 2000, Geewax,
Terker & Company, a Pennsylvania partnership, was the Money Manager of the
Growth Fund.
On Page B-32, the following replaces in its entirety the first two paragraphs
under "Money Manager Fees":
Money Manager Fees. The fees paid to the Money Manager of a Fund are paid
pursuant to a Money Manager Agreement among Accessor Funds on behalf of the
individual Fund, Accessor Capital and the Money Manager. The fees are based on a
percentage of the assets of the Fund and the performance of the Fund compared to
a benchmark index after a specific number of complete calendar quarters of
management by the Money Manager. Each Fund seeks to invest so that its
investment performance equals or exceeds the total return performance of a
relevant index (each a "Benchmark Index" and collectively the "Benchmark
Indices"), set forth below. See Appendix A of the Prospectuses for a description
of the Benchmark Indices.
For the first five complete calendar quarters managed by a Money Manager of each
Fund (except the U.S. Government Money Fund and Small to Mid Cap Fund), such
Fund will pay its respective Money Manager on a monthly basis based on the
average daily net assets of the Fund managed by such Money Manager, as set forth
in their respective Money Manager Agreements. With the exception of the Growth
Fund whose Money Manager commenced operations on May 1, 2000, the Money Managers
for the Value, Small to Mid Cap, International Equity, Intermediate
Fixed-Income, Short-Intermediate Fixed-Income and Mortgage Securities Funds have
completed five calendar quarters. During the first five calendar quarters of
management, the Money Manager Fee has two components, the Basic Fee and Fund
Management Fee. The Money Manager for the Growth Fund will earn on a monthly
basis at the following annual fee rates, applied to the average daily net assets
of the Fund, a Basic Fee of 0.10% and a Fund Management Fee of 0.10% for a total
of 0.20%.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN
- --------------------------------------------------------------------------------
On February 15, 2000, the Board of Directors of Accessor Funds, Inc. ("Accessor
Funds") terminated the Shareholder Service Plan of the Investor Class Shares of
Accessor Funds. The Board also amended the Distribution Plan, which they renamed
the Distribution and Service Plan, to incorporate any payments and services
previously made under the Shareholder Service Plan. The termination of the
Shareholder Service Plan and the amendment of the Distribution and Service Plan
will not increase the cost of distribution and shareholder services to the
Investor Class Shares, which will not exceed 0.25% annually of the Investor
Class assets. The Directors also approved technical, conforming amendments to
Accessor Fund's Rule 18f-3 Plan and the other related agreements.
In connection with the termination of the Shareholder Service Plan and the
amendment of the Distribution and Service Plan, the following language replaces
the sections entitled "MULTI-CLASS STRUCTURE" in the Statement of Additional
Information in its entirety:
MULTI-CLASS STRUCTURE
On February 19, 1998, the Board of Directors of Accessor Funds, adopted a
Rule 18f-3 Plan and established two classes of shares for the Funds, the Advisor
Class and the Investor Class. The initial shares of Accessor Funds were
redesignated as Advisor Class Shares. The Board of Directors of Accessor Funds,
including a majority of the non-interested Directors (as defined in the
Investment Company Act), voted in person at the Board meeting on February 15,
2000, to adopt an Amended Rule 18f-3 Plan (the "Amended Multi-Class Plan")
pursuant to Rule 18f-3 under the Investment Company Act. The Directors
determined that the Amended Multi-Class Plan is in the best interests of each
class individually and Accessor Funds as a whole.
Under the Amended Multi-Class Plan, shares of each class of each Fund
represent an equal pro rata interest in such Fund and, generally, have identical
voting, dividend, liquidation, and other rights, preferences, powers,
restrictions, limitations, qualifications and terms and conditions, except that:
(a) each class has a different designation; (b) each class of shares bears any
class-specific expenses allocated to it; and (c) each class has exclusive voting
rights on any matter submitted to shareholders that relates solely to its
distribution or service arrangements, and each class has separate voting rights
on any matter submitted to shareholders in which the interests of one class
differ from the interests of any other class.
As described in the Amended Multi-Class Plan, Accessor Funds, on behalf of
each Fund's Investor Class Shares, has adopted a Distribution and Service Plan
and an Administrative Services Plan, each as described below. Pursuant to the
appropriate plan, Accessor Funds may enter into arrangements with financial
institutions, retirement plans, broker-dealers, depository institutions,
institutional shareholders of record, registered investment advisers and other
financial intermediaries and various brokerage firms or other industry
recognized service providers of fund supermarkets or similar programs
(collectively "Service Organizations") who may provide distribution services and
shareholder services and/or administrative and accounting services to or on
behalf of their clients or customers who beneficially own Investor Class Shares.
Investor Class Shares are intended to be offered directly from Accessor Funds
and may be offered by Service Organizations to their clients or customers, which
may impose additional transaction or account fees. Accessor Capital may enter
into separate arrangements with some Service Organizations to provide accounting
and/or other services with respect to Investor Class Shares and for which
Accessor Capital will compensate the Service Organizations from its revenue.
As described in the Amended Multi-Class Plan, Accessor Funds has not
adopted a Distribution and Service Plan or Administrative Services Plan for the
Advisor Class Shares. Advisor Class Shares shall be offered by Accessor Funds at
NAV with no distribution, shareholder or administrative service fees paid by the
Advisor Class Shares of the Funds. Advisor Class Shares are offered directly
from Accessor Funds and may be offered through Service Organizations that may
impose additional or different conditions on the purchase or redemption of Fund
shares and may charge transaction or account fees. Accessor Funds, on behalf of
the Advisor Class Shares, pays no compensation to Service Organizations and
receives none of the fees or transaction charges. Accessor Capital may enter
into separate arrangements with some Service Organizations to provide
administrative, accounting and/or other services with respect to Advisor Class
Shares and for which Accessor Capital will compensate the Service Organizations
from its revenue.
Distribution and Service Plan. Accessor Funds has adopted a Distribution
and Service Plan (the "Distribution and Service Plan") under Rule 12b-1 ("Rule
12b-1") of the Investment Company Act with respect to the Investor Class Shares
of each Fund. Under the terms of the Distribution and Service Plan, Accessor
Funds is permitted, out of the assets attributable to the Investor Class Shares
of each Fund (i) to make directly or cause to be made, payments for costs and
expenses to third parties or (ii) to reimburse third parties for costs and
expenses incurred in connection with providing distribution services, including
but not limited to (a) costs of payments made to employees that engage in the
distribution of Investor Class Shares; (b) costs relating to the formulation and
implementation of marketing and promotional activities, including but not
limited to, direct mail promotions and television, radio, newspaper, magazine
and other mass media advertising; (c) costs of printing and distributing
prospectuses, statements of additional information and reports of Accessor Funds
to prospective holders of Investor Class Shares; (d) costs involved in
preparing, printing and distributing sales literature pertaining to Accessor
Funds and (e) costs involved in obtaining whatever information, analyses and
reports with respect to marketing and promotional activities that Accessor Funds
may, from time to time, deem advisable (the "Distribution Services"). Pursuant
to the Distribution and Service Plan, each Fund may also make payments to
Service Organizations who provide non-distribution related services, including
but not limited to: personal and/or account maintenance services. Such services
may include some or all of the following: (i) shareholder liaison services; (ii)
providing information periodically to Clients showing their positions in
Investor Class Shares and integrating such statements with those of other
transactions and balances in Clients' other accounts serviced by the Service
Organizations; (iii) responding to Client inquiries relating to the services
performed by the Service Organizations; (iv) responding to routine inquiries
from Clients concerning their investments in Investor Class Shares; and (v)
providing such other similar services to Clients as Accessor Funds may
reasonably request to the extent the Service Organizations are permitted to do
so under applicable statutes, rules and regulations.
Subject to the limitations of applicable law and regulations, including
rules of NASD, the payments made directly to third parties for such distribution
and service related costs or expenses, shall be up to but not exceed 0.25% of
the average daily net assets of the Funds attributable to the Investor Class
Shares. In the event the Distribution and Service Plan is terminated, the
Investor Class Shares shall have no liability for expenses that were not
reimbursed as of the date of termination.
Any Service Organization entering into an agreement with Accessor Funds
under the Distribution and Service Plan may also enter into an Administrative
Services Agreement with regard to its Investor Class Shares, which will not be
subject to the terms of the Distribution and Service Plan.
The Distribution and Service Plan may be terminated with respect to
Accessor Funds by a vote of a majority of the "non-interested" Directors who
have no direct or indirect financial interest in the operation of the
Distribution and Service Plan (the "Qualified Directors") or by the vote of a
majority of the outstanding voting securities of the relevant class of Accessor
Funds. Any change in the Distribution and Service Plan that would materially
increase the cost to the class of shares of Accessor Funds to which the
Distribution Service Plan relates requires approval of the affected class of
shareholders of Accessor Funds. The Distribution and Service Plan requires the
Board to review and approve the Distribution and Service Plan annually and, at
least quarterly, to receive and review written reports of the amounts expended
under the Distribution and Service Plan and the purposes for which such
expenditures were made. The Distribution and Service Plan may be terminated at
any time upon a vote of the Qualified Directors.
Administrative Services Plan. Accessor Funds has adopted an Administrative
Services Plan whereby Accessor Funds is authorized to enter into Administrative
Service Agreements on behalf of the Investor Class Shares of the Funds (the
"Agreements"), the form of which has been approved by the Board of Directors of
Accessor Funds (the "Board") and each Agreement will be ratified by the Board of
Directors at the next quarterly meeting after the arrangement has been entered
into. Each Fund will pay an administrative services fee under the Administrative
Services Plan at an annual rate of up to 0.25% of the average daily net assets
of the Investor Class Shares of the Fund (the "Administrative Services Fee")
beneficially owned by the clients of the Service Organizations. Provided,
however, that no Fund shall directly or indirectly pay any distribution related
amounts that will be allocated under Accessor Funds' Distribution and Service
Plan. Administrative Services Fees may be used for payments to Service
Organizations who provide administrative and support servicing to their
customers who may from time to time beneficially own Investor Class Shares of
Accessor Funds, which, by way of example, may include: (i) establishing and
maintaining accounts and records relating to shareholders; (ii) processing
dividend and distribution payments from the Fund on behalf of shareholders;
(iii) providing information periodically to shareholders showing their positions
in shares and integrating such statements with those of other transactions and
balances in shareholders other accounts serviced by such financial institution;
(iv) arranging for bank wires; (v) providing transfer agent or sub-transfer
agent services, recordkeeping, custodian or subaccounting services with respect
to shares beneficially owned by shareholders, or the information to the Fund
necessary for such services; (vi) if required by law, forwarding shareholder
communications from the Fund (such as proxies, shareholder reports, annual and
semi-annual financial statements and dividend, distribution and tax notices) to
shareholders; (vii) assisting in processing purchase, exchange and redemption
requests from shareholders and in placing such orders with our service
contractors; or (viii) providing such other similar services, which are not
considered "service fees" as defined in the NASD Rule 2830(b)(9), as a Fund may
reasonably request to the extent the Service Organization is permitted to do so
under applicable laws, statutes, rules and regulations. The Administrative
Services Plan may be terminated at any time by a vote of the Qualified
Directors. The Directors shall review and approve the Administrative Services
Plan annually and quarterly shall receive a report with respect to the amounts
expended under the Administrative Services Plan and the purposes for which those
expenditures were made
The Directors believe that the Distribution and Service Plan and the
Administrative Services Plan will provide benefits to Accessor Funds. The
Directors believe that the multi-class structure may increase investor choice,
result in efficiencies in the distribution of Fund shares and allow Fund
sponsors to tailor products more closely to different investor markets. The
Directors further believe that multiple classes avoid the need to create clone
funds, which require duplicative portfolio and fund management expenses.
The Distribution and Service Plan provides that it may not be amended to
materially increase the costs which Investor Class shareholders may bear under
the Plan without the approval of a majority of the outstanding voting securities
of Investor Class, and by vote of a majority of both (i) the Directors of
Accessor Funds and (ii) those Directors who are not "interested persons" of
Accessor Funds (as defined in the Investment Company Act) and who have no direct
or indirect financial interest in the operation of the Plan or any agreements
related to it (the "Qualified Directors"), cast in person at a meeting called
for the purpose of voting on the plans and any related amendments.
The Administrative Services Plan and Distribution and Service Plan provide
that each shall continue in effect so long as such continuance is specifically
approved at least annually by the Directors and the Qualified Directors defined
above, and that the Directors shall review at least quarterly, a written report
of the amounts expended pursuant to each plan and the purposes for which such
expenditures were made.
The Distribution and Service Plan provides that expenses payable under the
plan shall be accrued and paid monthly, subject to the limit that not more that
0.25% of the average daily net assets attributable to the Investor Class Shares
may be used to pay distribution or service related expenses.
