As filed with the Securities and Exchange Commission on February 26, 1999.
File No. 33-58512
File No. 811-7514
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |X|
Pre-Effective Amendment No. |_|
Post-Effective Amendment No. 10 |X|
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 |X|
Amendment No. 11 |X|
RWB/WPG U.S. LARGE STOCK FUND (FORMERLY U.S. LARGE STOCK FUND
(Exact name of Registrant as Specified in Charter)
ONE NEW YORK PLAZA, NEW
YORK, NEW YORK 10004
(Address of Principal
Executive Offices) (Zip
Code)
Registrant's Telephone Number: 800-223-3332
JAY C. NADEL, WEISS, PECK & GREER
ONE NEW YORK PLAZA, NEW
YORK, NEW YORK 10004
(Name and Address of
Agent for Service)
Copies to:
Ernest V. Klein, Esq.
Hale and Dorr
60 State Street
Boston, MA 02109
It is proposed that this filing will become effective (check appropriate box):
immediately upon filing pursuant to paragraph (b), or
on _______________ pursuant to paragraph (b), or
___ 60 days after filing pursuant to paragraph (a)(1), or
X on May 1, 1999 pursuant to paragraph (a)(1), of Rule 485
___ 75 days after filing pursuant to paragraph (a)(2) of Rule 485
___ on _______________ pursuant to paragraph (a)(2) of Rule 485.
<PAGE>
RWB/WPG U.S. LARGE
STOCK FUND
Prospectus
May 1, 1999
Reinhardt Werba Bowen
1190 Saratoga Avenue
Suite 200
San Jose, California 95129
800-366-7266 -- Extension 124
The Securities and Exchange Commission has not
approved or disapproved these securities or
determined whether this prospectus is accurate
or complete. Any statement to the contrary is a
crime.
<PAGE>
CONTENTS
- ------------------------------------------------------------------------------
Risk/Return Summary.................................................. 3
More about the fund's investments and risks.......................... 5
Management of the fund............................................... 6
How to buy shares.................................................... 7
How to redeem shares................................................. 8
Other shareholder service information and share price................ 9
Dividends, distributions and taxes................................... 10
Financial highlights................................................. 11
For More Information................................................. 12
WHO MAY INVEST
Shares of the fund are offered exclusively to individuals, institutions and
other entities that are advisory clients of Reinhardt Werba Bowen Advisory
Services.
2
<PAGE>
RISK/RETURN SUMMARY
- -------------------------------------------------------------------------------
INVESTMENT GOAL
The fund's investment goal is total return through investing in equity
securities of U.S. companies with large market capitalizations.
- -------------------------------------------------------------------------------
PRINCIPAL INVESTMENTS
The fund invests substantially all, and at least 65% of its assets, in common
stocks of U.S. companies with large market capitalizations.
Although the fund is generally fully invested in common stocks, the fund
may on occasion, instead of purchasing and selling common stocks directly,
invest in depository receipts and other investment companies which seek to
replicate the price performance and dividend yield of the S&P 500 Index and may
use derivative contracts (such as futures on the S&P 500 Index).
- -------------------------------------------------------------------------------
PRINCIPAL STRATEGIES
The adviser uses quantitative techniques to analyze the companies included
within the S&P 500 Index. Using a proprietary multi-factor model that considers
value characteristics, the adviser:
- Identifies stocks from among this group that are selling at low relative
prices in light of their earnings expectations.
- Assesses the level of risk associated with each stock, and identifies
stocks with the maximum expected return at each acceptable level of risk.
Based on this information, the adviser selects the combination of stocks,
together with their appropriate weightings, that it believes will optimize the
fund's risk/return ratio. The adviser seeks to maintain the market
capitalization, sector allocations and style characteristics of the fund's
portfolio similar to those of the S&P 500 Index. Although the fund's portfolio
will not contain all the stocks included in the S&P 500 Index, it is expected
that the fund's performance will be highly correlated with the performance of
the S&P 500 Index.
The portfolio is rebalanced regularly to maintain the optimal risk/return
trade-off.
- -------------------------------------------------------------------------------
PRINCIPAL RISKS
You could lose money on your investment in the fund or the fund could
underperform other possible investments if any of the following occurs:
- The U.S. stock market goes down.
- Stocks of large capitalization companies
temporarily fall out of favor with investors.
- Companies in which the fund invests suffer
unexpected losses or lower than expected
earning
- The adviser's judgment about the attractiveness, value or potential
appreciation of a particular company's common stock proves to be wrong.
- The factors considered by the multi-factor model select for investment,
stocks that underperform the S&P 500 Index.
An investment in the fund is not a bank deposit and is not insured or guaranteed
by the FDIC or any other government agency.
- --------------------------------------------------------------------------------
WHO MAY WANT TO INVEST
The fund may be appropriate if you:
- Are pursuing a long-term goal, such as
investing for retirement
- Are seeking higher long-term returns associated
with an investment in stocks, and can accept a
higher level of risk
- Are seeking to diversify your portfolio by
investing in a portfolio of common stocks of
large companies
- Are seeking an objective, disciplined
investment process
WHO MAY NOT WANT TO INVEST
The fund may not be appropriate if you:
- Are pursuing a short-term investment goal
- Want stability of principal
- Desire a high level of current income
3
<PAGE>
RISK/RETURN SUMMARY
- --------------------------------------------------------------------------------
PERFORMANCE
The bar chart and table shown below indicate the risks of investing in the fund.
The bar chart shows changes in the performance of the fund from year to year
over the life of the fund. The table shows how the fund's average annual returns
for different calendar periods, and since inception on June 8, 1993, compared to
those of the S&P 500 Index, an unmanaged index of common stocks.
[GRAPH OMITTED HERE. THE BAR CHART OMITTED HERE SHOWS THE CHANGES IN THE
PERFORMANCE OF THE FUND FROM YEAR TO YEAR OVER THE LIFE OF THE FUND.]
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended December 31, 1998)
1 YEAR 5 YEARS SINCE INCEPTION
------ ------- ---------------
Fund 24.51% 21.08% 19.82%
S&P 500 28.76% 24.15% 22.65%
Index
FUND'S BEST AND WORST QUARTERLY TOTAL RETURNS
Best: 18.28% in the 4th quarter of 1998
Worst: -10.73% in the 3rd quarter of 1998
*From June 9, 1993 through December 31, 1998
The fund's past performance does not necessarily indicate how the fund will
perform in the future.
- --------------------------------------------------------------------------------
FEES AND EXPENSES
This table describes the fees and expenses that you
may pay if you buy and hold shares of the fund.
SHAREHOLDER FEES None
(paid directly from your investment)
ANNUAL FUND OPERATING EXPENSES
(paid by the fund as a % of fund net assets)
Management fee(1) 0.26%
12b-1 distribution fees None
Other expenses(1) 0.27%
-----
Total operating expenses(1) 0.53%
====
- -----------------------
(1) Because the adviser agreed to cap the fund's expenses, the fund's
actual expenses for fiscal 1998 were:
Management fee 0.15%
Other expenses 0.27%
-----
Total operating expenses 0.42%
=====
EXAMPLE
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds. Your actual costs may be
higher or lower.
NUMBER OF YEARS YOU
OWN YOUR SHARES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
Expenses (without cap) $54 $170 $296 $665
Expenses (with cap) $43 $135 $235 $530
The example assumes:
- You invest $10,000 for the periods shown
- You redeem at the end of each period
- You reinvest all distributions and dividends without a sales
charge
- The fund's operating expenses have remained the same
- Your investment has a 5% return each year
4
<PAGE>
MORE ABOUT THE FUND'S INVESTMENTS AND RISKS
- --------------------------------------------------------------------------------
The Risk/Return Summary for the fund describes the fund's investment objective
and its principal investment strategies and risks. This section provides some
additional information about the fund's investments and certain portfolio
management techniques that the fund may use. More information about the fund's
investments and portfolio management techniques, some of which entail risks, is
included in the Statement of Additional Information (SAI).
EQUITY INVESTMENTS Although the fund invests primarily in
common stocks of companies with large market
capitalizations, the fund may invest in all other
types of equity securities, including
exchange-traded and over-the-counter preferred
stocks, warrants, rights, convertible securities,
depositary receipts and shares, trust certificates,
limited partnership interests, shares of other
investment companies and REITs, and equity
participations. A company is considered to be large
cap if it has a public market capitalization of at
least $4 billion.
FIXED INCOME INVESTMENTS The fund may invest up to 10% of
its assets in fixed income securities of all kinds.
These fixed income securities will be rated at least
AA by Standard & Poor's or Aa by Moody's or their
equivalent ratings by other rating agencies or, if
unrated, determined by the adviser to be of
comparable credit quality. Fixed income investments
include bonds, notes (including structured notes),
mortgage-backed securities, asset-backed securities,
convertible securities, Eurodollar and Yankee dollar
instruments and money market instruments. Fixed
income securities may be issued by corporate and
governmental issuers and may have all types of
interest rate payment and reset terms, including
fixed rate, adjustable rate, zero coupon,
contingent, deferred, payment-in-kind and auction
rate features.
DERIVATIVE CONTRACTS The fund may, but need not, use derivative
contracts for either of the following purposes: to
hedge against adverse changes caused by changes in
stock market prices in the market value of its
securities or securities to be bought; or as a
substitute for buying or selling securities.
Examples of derivative contracts include: futures
and options on securities and securities indices;
and options on these futures. A derivative contract
will obligate or entitle the fund to deliver or
receive an asset or cash payment that is based on
the change in value of one or more securities or
indices. Even a small investment in derivative
contracts can have a big impact on the fund's stock
market exposure. Therefore, using derivatives can
disproportionately increase losses and reduce
opportunities for gains when stock prices are
changing. The fund may not fully benefit from or may
lose money on derivatives if changes in their value
do not correspond accurately to changes in the value
of the fund's holdings. The other parties to certain
derivative contracts present the same types of
default risk as issuers of fixed income securities.
derivatives can also make the fund less liquid and
harder to value, especially in declining markets.
INVESTMENT GOALS The fund's investment goal is not fundamental
and may be changed without shareholder approval by
the fund's board of trustees. If there is a change
in the fund's investment goal, you should consider
whether the fund remains an appropriate investment.
5
<PAGE>
THE ADVISER Weiss, Peck & Greer, L.L.C. serves as the
fund's investment adviser. WPG is headquartered at
One New York Plaza, New York, New York 10004, and is
a subsidiary of Robeco Groep N.V., A Dutch public
limited liability company. FoundeD in 1929, Robeco
is one of the world's oldest asset management
organizations. As of the date of this prospectus,
Robeco had approximately $95 billion in assets under
management, including $17 billion managed directly
by WPG. WPG, which has over 28 years experience as
an investment adviser to institutional and
individual clients, is a member firm of the New York
Stock Exchange.
Subject to the general supervision of the fund's
boards of trustees, WPG manages the fund's portfolio
and is responsible for the selection and management
of all portfolio investments of the fund in
accordance with the fund's investment objective and
policies.
THE PORTFOLIO
MANAGER
<TABLE>
<CAPTION>
PORTFOLIO MANAGER SINCE PAST 5 YEARS' BUSINESS EXPERIENCE
THE PORTFOLIO MANAGER IS ----------------- ----- ---------------------------------
PRIMARILY RESPONSIBLE FOR THE
DAY-TO-DAY OPERATION OF THE FUND.
<S> <C> <C> <C>
Daniel J. Cardell 1996 Managing director of the adviser. Prior thereto, senior vice
president and director of equities for the Bank of America.
</TABLE>
MANAGEMENT FEE For the fiscal year ended December 31, 1998, the
fund paid WPG a management fee at the annual rate of
0.15% of the fund's average daily net assets, after
a voluntary waiver by WPG. The management fee
decreases from 0.26% of average daily net assets of
assets up to $500 million to 0.20% of average daily
net assets of assets in excess of $2 billion.
The Administrator WPG also acts as the fund's
administrator. As administrator, WPG provides
personnel for supervisory, administrative,
accounting and clerical functions; oversees the
performance of administrative and professional
services to the fund by others; provides office
facilities, furnishings and office equipment; and
prepares, but does not pay for, reports to
shareholders, the SEC and other regulatory
authorities. For its administrative services, WPG
does not currently receive any compensation.
Expense Cap WPG has voluntarily agreed to limit the fund's
total operating expenses (excluding extraordinary
expenses) to 0.42% of the fund's average daily net
assets. WPG has no current intention of modifying or
discontinuing the expense limitation but may do so
in the future at its discretion.
Year 2000 Challenge Many computer software systems in use today cannot
properly process date-related information after
December 31, 1999. This failure, commonly referred
to as the "Year 2000 Issue," could adversely affect
the handling of securities trades, pricing and
account servicing for the fund. In addition, the
cost of addressing Year 2000 compliance may
adversely affect the issues of individual securities
held by the fund. The adviser has made Year 2000
compliance a high priority and is taking steps that
it believes are reasonably designed to address the
Year 2000 Issue for its computer systems. The
adviser has also been informed that comparable steps
are being taken by the fund's other major service
providers. The adviser does not currently anticipate
that the Year 2000 Issue will have a material impact
on its ability to continue to fulfill its duties as
investment adviser. However, non- compliant computer
systems in general could have a material adverse
effect on the fund's business, operations or
financial condition. Additionally, the fund's
performance could be hurt if a computer system
failure at a company or governmental unit affects
the prices of portfolio securities.
6
<PAGE>
HOW TO BUY SHARES
- --------------------------------------------------------------------------------
IN GENERAL Shares of the fund may be purchased only by
investment advisory clients of Reinhardt Werba Bowen
Advisory Services ("RWB"). RWB is a registered
investment adviser organized in 1975 and located in
San Jose, California.
Because shares of the fund are available only to
clients of RWB, you must have an account agreement
with RWB before you may invest in the fund. Please
call RWB at 1-800-366-7266 -- Extension 124 for more
information regarding the services provided by RWB,
including how to purchase fund shares.
The fund reserves the right to reject any purchase
for any reason and to cancel any purchase due to
nonpayment. All purchases must be made in U.S.
dollars and, to avoid fees and delays, all checks
must be drawn only on U.S. banks. No cash will be
accepted. If your purchase is cancelled due to
nonpayment or because your check does not clear (and
as a result, your account must be redeemed), you
will be responsible for any loss incurred by the
fund.
INVESTMENT The fund currently does not have any minimum
MINIMUM investment or account requirements, although it may
establish minimum account balance requirements in
the future.
THROUGH AN AUTHORIZED Financial Institutions approved by RWB are
FINANCIAL authorized to hold your fund shares as well as
INSTITUTION shares of other mutual funds and your other
investment securities. Approved financial
institutions include certain banks and brokerage
firms. In consideration of these services, financial
institutions may charge you a fee -- no part of
which will be received by the fund or WPG.
SHARE PRICE Purchase orders for fund shares
are priced at the fund's net asset value
next determined after receipt of the purchase order
by an authorized financial institution, provided
that the order has been received by the fund (or its
agents) prior to its close of business. Your
financial institution is responsible for timely
transmittal of your purchase order to RWB or other
fund agent. See "How Shares of the Fund are Valued."
SHARE CERTIFICATES The fund will not issue share certificates.
7
<PAGE>
HOW TO REDEEM SHARES
- -------------------------------------------------------------------------------
IN GENERAL As with purchases of fund shares,
redemptions will be effected by the fund based on
instructions it receives from RWB.
Subject to the restrictions outlined below, you may
redeem all or any part of your shares in the fund at
a price equal to the net asset value next computed
following receipt and acceptance of your redemption
request in proper form by the fund or its agents.
A redemption is a taxable transaction that may
result in a tax liability for you.
Except under certain emergency conditions, your
redemption payment will be sent to you (net of any
required withholding taxes) within three business
days after receipt of your written redemption
request in proper form by the fund or its agents. If
you wish to have your redemption proceeds wired to
your checking or bank account, you may so elect.
Currently, the fund's transfer agent charges a fee
for wire transfers.
You cannot redeem shares by facsimile. In addition,
the fund cannot accept requests which specify a
particular date or price for redemption or which
specify any other special conditions.
BY MAIL You may submit a written redemption request in
proper form directly to the fund, Attention RWB/WPG
U.S. Large Stock Fund, One New York Plaza, New York,
New York 10004. No charge is imposed on any
redemption request processed directly by the fund.
BY TELEPHONE You may authorize telephone redemptions by
marking the appropriate boxes on your account
application and providing the information requested
in the application. To redeem shares by telephone,
simply call 1-800-223-3332 between 9:00 a.m. and
4:00 p.m. Eastern time on any day that the fund is
open. Telephone redemption requests made after 4:00
p.m. Eastern time will not be accepted. See "More
about Telephone Redemptions" below.
THROUGH AN AUTHORIZED You may transmit your redemption request to the fund
FINANCIAL through an authorized financial institution.
INSTITUTION Financial institutions maycharge you a fee for this
service -- no part of which will be received by the
fund or WPG.
PROPER FORM To be in proper form, your redemption request must
include:
- Name of the fund
- Account number
- Dollar amount or number of shares to redeem
- Signature of each owner exactly as account is
registered
- Signature guarantees, if your proceeds are being
sent to an address or person other than those
listed on the account registration
- Any other documentation required by the fund's
transfer agent or adviser (generally required for
redemptions by corporations, estates, trusts,
guardianships, custodianships, partnerships, and
pension and profit sharing plans)
If you make a redemption request within 15 days of
the date you purchased shares by means of a
personal, corporate or government check, the
redemption payment will be held until the check has
cleared (up to 15 days). Nevertheless, the shares
redeemed will be priced for redemption at the price
next determined after receipt of your redemption
request. You can avoid the inconvenience of this
check clearing period by purchasing shares with a
certified, treasurer's or cashier's check, or with a
federal funds or bank wire.
SIGNATURE You can obtain a signature guarantee from most
GUARANTEES banks, dealers, brokers, credit unions and federal
savings and loans, but not from a notary public.
8
<PAGE>
OTHER SHAREHOLDER SERVICE INFORMATION AND SHARE PRICE
- --------------------------------------------------------------------------------
SHAREHOLDER RWB services shareholders' accounts with the fund.
SERVICING AGENT These shareholder services include but are not
limited to: establishing and maintaining a toll-free
telephone number for investors to use in obtaining
current account information; providing to investors
quarterly reports with respect to the fund's
performance; and providing to investors upon
request, information concerning the operation of the
fund and their investment in the fund. RWB and the
fund may amend the shareholder services described in
this prospectus or change the terms or conditions
relating to such services upon 60 days' notice to
shareholders.
In consideration of these services, the fund pays to
RWB a fee equal, on an annual basis, to 0.10% of the
fund's average daily net assets.
SHAREHOLDER If you have any questions about the fund or the
INQUIRIES shareholder services described in this prospectus,
please call RWB at 1-800-366-7266 -- extension 124.
Written inquiries should be sent to RWB at its
address shown on the front cover of this prospectus.
SHAREHOLDER CONFIRMATIONS, Each time you buy or sell shares you will receive a
STATEMENTS AND REPORTS confirmation statement for that transaction. In
addition, following each distribution from the fund,
you will receive a shareholder statement reflecting
any reinvestment of a dividend or distribution in
shares of the fund, including your current share
balance with the fund. The fund will also send you
shareholder reports no less frequently than
semi-annually. You also will receive, shortly after
year-end, tax information about your account with
the fund.
HOW SHARES OF THE FUND The fund's net asset value per share is calculated
ARE VALUED as of the close of regular trading on the New York
Stock Exchange, normally 4:00 p.m. Eastern time,
every day the Exchange is open for regular trading.
The net asset value per share, calculated as
described below, is effective for all orders
received in good order by the fund or its agents
prior to the close of regular trading on the
Exchange for that day. Orders received by the fund
or its agents after the close of regular trading on
the Exchange or on a day when the Exchange is not
open for business will be priced at the net asset
value per share next computed. The Exchange is
generally open Monday through Friday except for most
national holidays.
The net asset value (NAV) of the fund's shares is
determined by adding the value of all securities,
cash and other assets of the fund, subtracting
liabilities (including accrued expenses and
dividends payable), and dividing the result by the
total number of outstanding shares in the fund.
For purposes of calculating the fund's NAV,
securities (other than certain money market
instruments) are valued primarily based on market
quotations. If market quotations are not available,
then the fair value of the securities is determined
by a valuation committee appointed by the Board of
Trustees. If the fund uses fair value to price
securities, it may value those securities higher or
lower than another fund that uses market quotations
to price the same securities. The fund may use
pricing services to value bonds and other fixed
income investments. Money market instruments with a
remaining maturity of 60 days or less at the time of
purchase are generally valued at amortized cost.
MORE ABOUT The fund may use identification procedures, such as
TELEPHONE REDEMPTIONS providing written confirmation of telephone exchange
transactions and tape recording of telephone
exchange requests, to confirm that a telephone
redemption request is genuine. The fund may refuse
any request made by telephone and may limit the
amount involved or the number of telephone requests
made by any shareholder. (Such exchange requests
may, however, be made in writing in accordance with
procedures described in "How to redeem shares.")
During periods of extreme economic conditions or
market changes, requests by telephone may be
difficult to make due to the heavy volume. During
such times, please consider placing your order by
mail.
9
<PAGE>
DIVIDENDS, DISTRIBUTIONS AND TAXES
- --------------------------------------------------------------------------------
DIVIDENDS The fund normally pays dividends and distributes
AND DISTRIBUTIONS capital gains, if any, annually. Such distributions
are primarily from capital gains. The fund may pay
additional distributions and dividends at other
times if necessary to avoid federal tax. Unless you
instruct otherwise, capital gain distributions and
dividends are reinvested in additional fund shares.
The fund's distributions and dividends, whether
received in cash or reinvested in additional fund
shares, are subject to federal income tax. You do
not pay a sales charge on reinvested distributions
or dividends.
TAXES In general, distributions and share transactions are
taxed as follows:
TRANSACTION FEDERAL INCOME TAX STATUS
----------- -------------------------
Redemption of shares Usually capital gain or loss;
long-term only if shares
owned more than one year
Long-term capital gain Long-term capital gain
distributions
Short-term capital gain Ordinary income
distributions
Dividends Ordinary income
Long-term capital gain distributions are taxable to
you as long-term capital gain regardless of how long
you have owned your shares. You may want to avoid
buying shares when the fund is about to declare a
capital gain distribution or a dividend, because it
will be taxable to you even though it may actually
be a return of a portion of your investment.
After the end of each year, the fund will provide
you with information about the distributions and
dividends that you received and any reportable
redemptions of shares during the previous year. If
you do not provide the fund with your correct
taxpayer identification number and any required
certifications, you may be subject to back-up
withholding of 31% of your distributions, dividends,
and redemption proceeds. Because each shareholder's
circumstances are different and special tax rules
may apply, you should consult your tax adviser about
your investment in the fund.
10
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The financial highlights table is intended to help you understand the
performance of the fund for the past five years. Certain information reflects
financial results for a single share. Total returns represent the rate that a
shareholder would have earned (or lost) on a fund share assuming reinvestment of
all dividends and distributions. The information in the following table was
audited by KPMG LLP, independent auditors, whose report, along with the fund's
financial statements are included in the annual report (available upon request).
<TABLE>
<CAPTION>
RWB/WPG U.S. LARGE STOCK FUND
FINANCIAL HIGHLIGHTS (FOR THE YEARS ENDED DECEMBER 31,)
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Per Share Data:
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Year ...... $ 7.43 $ 6.65 $ 6.39 $ 5.05 $ 5.16
-------------- -------------- -------------- -------------- --------------
Net Investment Income .................. 0.14 0.12 0.13 0.13 0.14
Net Realized and Unrealized Gain/(Loss)
on Investments ..................... 1.65 1.93 1.12 1.58 (0.14)
-------------- -------------- -------------- -------------- --------------
Total Income from Operations .............. 1.79 2.05 1.25 1.71 0.00
-------------- -------------- -------------- -------------- --------------
Dividends from Net Investment Income ... (0.13) (0.11) (0.12) (0.13) (0.11)
Distributions from Capital Gains ....... (1.46) (1.16) (0.87) (0.24) 0.00
-------------- -------------- -------------- -------------- --------------
Total Distributions ....................... (1.59) (1.27) (0.99) (0.37) (0.11)
-------------- -------------- -------------- -------------- --------------
Net Asset Value End of Year ............... $ 7.63 $ 7.43 $ 6.65 $ 6.39 $ 5.05
============== ============== ============== ============== ==============
Total Return ................................. 24.51% 30.83% 19.33% 33.81% 0.06%
Net Assets at End of Period (000's) .......... $ 186,896 $ 212,951 $ 200,226 $ 174,161 $ 106,850
Ratios:
Ratio of Expenses to Average Net Assets (a) 0.42% 0.51% 0.59% 0.69% 0.75%
Ratio of Net Investment Income to Average
Net Assets (a) ......................... 1.21% 1.46% 1.86% 2.26% 2.65%
Portfolio Turnover Rate ................... 24.2% 54.2% 59.6% 27.1% 36.2%
<FN>
(a) The Advisor agreed not to impose its full fee from inception through
December 31, 1998. Had the Advisor not so agreed, the ratio of expenses and
net investment income to average net assets would have been 0.79% and 2.61%
for the year ended 12/31/94, 0.74% and 2.21% for the year ended 12/31/95,
0.62% and 1.83% for the year ended 12/31/96, 0.53% and 1.44% for the year
ended 12/31/97, and 0.53% and 1.10% for the year ended 12/31/98,
respectively. The custody fee earnings credit had an effect of less than
0.01% per share on the above ratios.
</FN>
</TABLE>
11
<PAGE>
- -----------------------------------------------------------------------------
RWB/WPG U.S. LARGE STOCK FUND
- -----------------------------------------------------------------------------
FOR MORE INFORMATION
If you want more information about the fund, the following documents are
available upon request:
SHAREHOLDER REPORTS
Annual and semiannual reports to shareholders provide additional information
about the fund's investments. These reports discuss the market conditions and
investment strategies that significantly affected the fund's performance during
its last fiscal year.
STATEMENT OF ADDITIONAL INFORMATION
The Statement of Additional Information (SAI) provides more detailed information
about the fund. It is incorporated into this prospectus by reference.
Investment Company Act file number 811-7514
HOW TO OBTAIN THIS INFORMATION
You may get free copies of the fund's shareholder reports and the SAI by
contacting RWB at:
Address: 1190 Saratoga Avenue
Suite 200
San Jose, California 95129
Telephone: 1-800-366-7266 -- Extension 124
You can review the fund's shareholder reports, prospectus and SAI at the Public
Reference Room of the Securities and Exchange Commission. You can get text- only
copies of these documents for free from the SEC's website at HTTP://WWW.SEC.GOV,
or for a fee by writing to or calling:
Address: Public Reference Room
Securities and Exchange Commission
Washington, D.C. 20549-6009
Telephone: 1-800-733-0330
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IF SOMEONE MAKES A STATEMENT THAT IS NOT IN THIS PROSPECTUS ABOUT THE FUND, YOU
SHOULD NOT RELY UPON THAT INFORMATION. NEITHER THE FUND NOR ITS DISTRIBUTOR IS
OFFERING TO SELL SHARES OF THE FUND TO ANY PERSON TO WHOM THE FUND MAY NOT
LAWFULLY SELL ITS SHARES.
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RWB/WPG U.S. LARGE STOCK FUND
A No-Load, Diversified
Mutual Fund
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STATEMENT OF ADDITIONAL
INFORMATION
--------------------------------------------------
May 1, 1999
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectus of the RWB/ WPG U.S. Large Stock Fund dated
May 1, 1999, as amended and/or supplemented from time to time (the
"Prospectus"), a copy of which may be obtained without charge by writing to
RWB/WPG U.S. Large Stock Fund, 1190 Saratoga Avenue, Suite 200, San Jose,
California 95129 or by calling 1-(800)-366-7266 -- EXT. 124.
Additional information about the Fund's investments is available in the Fund's
annual and semi-annual reports to shareholders. Investors can obtain free copies
of reports and the Prospectus by contacting the Fund at the phone number above.
The Fund's financial statements, which are included in the 1998 annual reports
to shareholders, are incorporated by reference into this SAI.
THE STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND IS
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED
OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS.
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TABLE OF CONTENTS
PAGE
INVESTMENT OBJECTIVE AND POLICIES.........................................3
INVESTMENT RESTRICTIONS.................................................. 6
INVESTMENT ADVISER, ADMINISTRATOR AND
PRINCIPAL UNDERWRITER ................................................. 7
TRUSTEES AND OFFICERS....................................................10
HOW TO PURCHASE SHARES...................................................17
REDEMPTION OF FUND SHARES................................................17
SHAREHOLDER SERVICES.....................................................18
NET ASSET VALUE..........................................................18
DIVIDENDS, DISTRIBUTIONS AND TAX STATUS..................................18
PORTFOLIO BROKERAGE......................................................22
PORTFOLIO TURNOVER.......................................................24
ORGANIZATION ............................................................25
PERFORMANCE INFORMATION..................................................26
PERFORMANCE SUMMARY......................................................27
CUSTODIAN................................................................27
TRANSFER AGENT...........................................................27
INDEPENDENT AUDITORS ....................................................27
FINANCIAL STATEMENTS.....................................................27
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INVESTMENT OBJECTIVE AND POLICIES
RWB/WPG U.S. Large Stock Fund (the "Fund") is a registered no-load,
diversified open-end management investment company organized as a Delaware
business trust on February 16, 1993. On May 1, 1996, the Fund changed its name
from "U.S. Large Stock Fund" to "RWB/WPG U.S.
Large Stock Fund."
The investment objective, policies and restrictions of the Fund may
be changed or altered by the Board of Trustees of the Fund (the "Board"),
without shareholder approval except to the extent such policies and restrictions
have been adopted as fundamental. See "Investment Restrictions." The securities
in which the Fund may invest and certain other investment policies are described
in the Fund's Prospectus. This Statement of Additional Information should be
read in conjunction with the Prospectus.
The Fund offers investment advisory clients of Reinhardt Werba Bowen
Advisory Services, 1190 Saratoga Avenue, Suite 200, San Jose California 95129
("RWB"), a registered investment adviser, the opportunity to participate in a
portfolio of securities primarily of large market capitalization U.S.
companies.
FUTURES TRANSACTIONS
The Fund may enter into transactions for the purchase or sale of
futures contracts based on the S&P 500 Index which are traded on exchanges that
are licensed and regulated by the Commodity Futures Trading Commission ("CFTC").
FUTURES CONTRACTS ON INDICES. Futures contracts on indices do not
require the physical delivery of securities, but merely provide for profits and
losses resulting from changes in the market value of a contract to be credited
or debited at the close of each trading day to the respective accounts of the
parties to the contract. On the contract's expiration date a final cash
settlement occurs and the futures positions are simply closed out. Changes in
the market value of a particular futures contract reflect changes in the value
or level of the index on which the futures contract is based.
HEDGING STRATEGIES. Hedging by use of futures contracts seeks to
establish with more certainty than would otherwise be possible the value of or
effective rate of return on portfolio securities or securities that the Fund
proposes to acquire. The Fund may, for example, take a "short" position in the
futures market by selling futures contracts in order to hedge against an
anticipated decline in securities prices or rise in interest rates that would
adversely affect the value of the Fund's portfolio securities. If, in the
opinion of Weiss, Peck & Greer, L.L.C., the Fund's investment adviser (the
"Adviser" or "WPG"), there is a sufficient degree of correlation between price
trends for the Fund's portfolio securities and futures contracts based on the
S&P 500 Index, the Fund may enter into futures contracts on the S&P 500 Index as
part of its hedging strategy. When hedging of this character is successful, any
depreciation in the value of portfolio securities will be substantially offset
by appreciation in the value of the futures position. On other occasions, the
Fund may take a "long" position by purchasing such futures contracts. This would
be done, for example, when the Fund anticipates the purchase of particular
securities when it has the necessary cash, but expects the price or rate of
return then available in the securities market to be less favorable than prices
or rates that are currently available in the futures markets.
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LIMITATIONS AND RISKS OF FUTURES TRANSACTIONS. The Fund may engage
in futures transactions for hedging purposes in accordance with CFTC regulations
or to seek to increase total return to the extent permitted by such regulations.
In utilizing futures for hedging the Fund will determine that the price
fluctuations in the futures contracts used for hedging purposes are
substantially related to price fluctuations in securities held by the Fund or
which it expects to purchase. Except as stated below, the Fund's futures
transactions will be entered into for traditional hedging purposes--that is,
futures contracts will be sold to protect against a decline in the price of
securities that the Fund owns, or futures contracts will be purchased to protect
the Fund against an increase in the price of securities it intends to purchase.
In instances involving the purchase of futures contracts by the Fund, an amount
of cash and cash equivalents, equal to the market value of the futures contracts
and options (less any related margin deposits), will be segregated on the Fund's
records or deposited in a segregated account with the Fund's custodian to
collateralize the position, thereby insuring that the use of such futures
contracts and options is unleveraged. As evidence of this hedging intent, the
Fund expects that on 75% or more of the occasions on which it takes a long
futures position (purchases futures contracts) the Fund will have purchased, or
will be in the process of purchasing, equivalent amounts of related securities
in the securities market at the time when the futures position is closed out.
However, in particular cases when it is economically advantageous for the Fund
to do so, a long futures position may be terminated without the corresponding
purchase of securities. As an alternative to compliance with the bona fide
hedging definition, a CFTC regulation permits the Fund to elect to comply with a
different test, under which the sum of the amounts of initial margin deposits on
the Fund's existing futures contracts and premiums paid for options on futures
entered into for the purpose of seeking to increase total return (net of the
amount the positions were "in the money" at the time of purchase) would not
exceed 5% of the market value of the Fund's net assets, after taking into
account unrealized gains and losses on such positions.
The use of futures contracts entails certain risks, including, but
not limited to the following: no assurance that futures transactions can be
offset at favorable prices; possible reduction in value of both the securities
hedged and the hedging instrument; possible lack of liquidity due to daily
limits on price fluctuations; imperfect correlation between the contract and the
securities being hedged; and potential losses in excess of the initial face
amount of the futures contracts themselves. The use of futures contracts
requires special skills in addition to those needed to select portfolio
securities. If the expectations of the adviser regarding movements in securities
prices are incorrect, the Fund may have experienced better investment results
without the use of futures contracts.
The Fund will incur brokerage fees in connection with its futures
transactions, and it will be required to deposit and maintain funds with its
brokers as margin to guarantee performance of its futures obligations. In
addition, while futures contracts may be traded to reduce certain risks, futures
trading itself entails certain other risks. Thus, while the Fund may benefit
from the use of such contracts, unanticipated changes in stock market prices may
result in a poorer overall performance for
the Fund than if it had not entered into any futures contracts. Moreover, in the
event of an imperfect correlation between the futures contract and the portfolio
position which is intended to be protected, the desired protection may not be
obtained and the Fund may be exposed to risk of loss.
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The Fund will be required, in connection with transactions in
futures contracts to make margin deposits, which will be held by the Fund's
custodian for the benefit of the merchant through whom the Fund engages in such
futures and options transactions. In the case of futures contracts thereon
requiring the Fund to purchase securities, the Fund must segregate cash or
liquid securities in an account maintained by the custodian to cover such
contracts. Cash or liquid securities required to be in a segregated account will
be marked to market daily.
To compensate for the imperfect correlation of movements in the
price of securities being hedged and movements in the price of futures
contracts, the Fund may buy or sell futures contracts in a greater dollar amount
than the dollar amount of the securities being hedged if the historical
volatility of the prices of such securities has been greater than the historical
volatility of the futures contracts. Conversely, the Fund may buy or sell fewer
futures contracts if the historical volatility of the price of the securities
being hedged is less than the historical volatility of the futures contracts.
Prior to exercise or expiration, an option position can be
terminated only by entering into a closing purchase or sale transaction. This
requires a secondary market on an exchange for call or put options of the same
series. Positions in futures may be closed out only on an exchange which
provides a secondary market for such futures. The Fund will enter into futures
positions only if there appears to be a liquid secondary market for such
futures. However, there can be no assurance that a liquid secondary market will
exist for any particular futures contract at any specific time. Thus, it may not
be possible to close a futures position. In the event of adverse price
movements, the Fund would continue to be required to make daily cash payments of
maintenance margin for futures contracts. The Fund may have to sell portfolio
securities at a time when it may be disadvantageous to do so if it had
insufficient cash to meet the daily maintenance margin requirements. In
addition, the Fund may be required to take or make delivery of the instruments
underlying interest rate futures contracts it holds. The inability to close
futures positions also could have an adverse impact on the Fund's ability to
effectively hedge its portfolios.
DEPOSITORY RECEIPTS
With respect to foreign securities included in the S&P 500 Index,
the Fund may purchase American Depository Receipts. ADRs are U.S.
dollar-denominated certificates issued by a U.S. bank or trust company and
represent the right to receive securities of a foreign issuer deposited in a
domestic bank or foreign branch of a U.S. bank. ADRs are traded on domestic
exchanges or in the U.S. over-the-counter (OTC) market and, generally, are in
registered form. Investments in ADRs have certain advantages over direct
investment in the underlying non-U.S. securities because (i) ADRs are U.S.
dollar-denominated investments which are registered domestically, easily
transferable, and for which market quotations are readily available, and (ii)
issuers whose securities are represented by ADRs are subject to the same
auditing, accounting and financial reporting standards as domestic issuers. To
the extent the Fund acquires ADRs through banks which do not have a contractual
relationship with the foreign issuer of the security underlying the ADR to issue
and service such ADRs, there may be an increased possibility that the Fund would
not become aware of and be able to respond to corporate actions such as stock
splits or rights offerings involving the foreign issuer in a timely manner.
However, the Fund intends to invest in ADRs that are issued in a program
sponsored by the issuer of the underlying securities.
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REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements in order to generate
additional current income. A repurchase agreement is an agreement under which
the Fund acquires a money market instrument, generally a United States
Government obligation, from a financial institution subject to resale to the
financial institution at an agreed upon price and date. Such resale price
reflects an agreed upon interest rate effective for the period of time the
instrument is held by the Fund. The repurchase price may be higher than the
purchase price, the difference being income to the Fund, or the purchase and
repurchase prices may be the same, with interest at a stated rate due to the
Fund together with the repurchase price on repurchase. In either case, the
income to the Fund is unrelated to the interest rate on the instrument.
Repurchase agreements usually are for short periods, such as one week or less,
but may be for longer periods. Repurchase agreements of more than one week's
duration are subject to the Fund's limitation on investments in illiquid
securities.
The use of repurchase agreements involves certain risks. For
example, if the other party to the agreement defaults on its obligation to
repurchase the underlying security at a time when the value of the security has
declined, the Fund may incur a loss upon disposition of the security. If the
other party to the agreement becomes insolvent and subject to liquidation or
reorganization under the Bankruptcy Code or other laws, a court may determine
that the underlying security is collateral for a loan by the Fund not within the
control of the Fund and therefore subject to sale by the trustee in bankruptcy.
Finally, it is possible that the Fund may not be able to perfect its interest in
the underlying security and may be deemed an unsecured creditor of the other
party to the agreement. While the Fund's management acknowledges these risks, it
is expected that they can be controlled through careful monitoring procedures.
In addition to the risk of the seller's default or a decline in value of the
underlying security, the Fund also might incur disposition costs in connection
with liquidating the underlying securities.
Repurchase agreements are considered by the Securities and Exchange
Commission (the "SEC") to be loans by the purchaser collateralized by the
underlying securities. In an attempt to reduce the risk of incurring a loss on a
repurchase agreement, the Fund will generally enter into repurchase agreements
only with domestic banks with total assets in excess of one billion dollars or
primary U.S. Government securities dealers reporting to the Federal Reserve Bank
of New York, with respect to securities of the type in which the Fund may
invest. The Fund will monitor the value of the underlying securities throughout
the term of the agreement to ensure that their market value always equals or
exceeds the agreed-upon repurchase price to be paid to the Fund. The Fund will
maintain a segregated account with the custodian for the securities and other
collateral, if any, acquired under a repurchase agreement with a broker-dealer
for the term of the agreement.
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OTHER INVESTMENT COMPANIES
The Fund may, subject to authorization by its Board of Trustees,
invest all of its investable assets in the securities of a single open-end
investment company (a "Portfolio"). If authorized by the Board, the Fund would
seek to achieve its investment objective by investing in a Portfolio, which
Portfolio would invest in a portfolio of securities that complies with the
Fund's investment objective, policies and restrictions. The Board does not
intend to authorize investing in this manner at this time.
The Fund may invest up to 10% of its total assets in the securities
of other investment companies not affiliated with WPG. For example, the Fund may
invest in Standard & Poor's Depositary Receipts (commonly referred to as
"Spiders"), which are exchange-traded shares of a closed-end investment company
that are designed to replicate the price performance and dividend yield of the
Standard & Poor's 500 Composite Stock Price Index. The Fund will indirectly bear
its proportionate share of any management fees and other expenses paid by
investment companies in which it invests in addition to the advisory and
administration fees paid by the Fund.
EURODOLLAR AND YANKEE DOLLAR INVESTMENTS
The Fund may invest in obligations of foreign branches of U.S. banks
(Eurodollars) and U.S. branches of foreign banks (Yankee dollars) as well as
foreign branches of foreign banks. These investments involve risks that are
different from investments in securities of U.S. banks, including potential
unfavorable political and economic developments, different tax provisions,
seizure of foreign deposits, currency controls, interest limitations or other
governmental restrictions which might affect payment of principal or interest.
FORWARD COMMITMENT AND WHEN-ISSUED TRANSACTIONS
The Fund may purchase or sell securities on a when-issued or forward
commitment basis (subject to its investment policies and restrictions). These
transactions involve a commitment by the Fund to purchase or sell securities at
a future date (ordinarily one or two months later). The price of the underlying
securities (usually expressed in terms of yield) and the date when the
securities will be delivered and paid for (the settlement date) are fixed at the
time the transaction is negotiated. When-issued purchases and forward
commitments are negotiated directly with the other party, and such commitments
are not traded on exchanges. The Fund will not enter into such transactions for
the purpose of leverage.
When-issued purchases and forward commitments enable the Fund to
lock in what is believed by the Adviser to be an attractive price or yield on a
particular security for a period of time, regardless of future changes in
interest rates. For instance, in periods of rising interest rates and falling
prices, the Fund might sell securities it owns on a forward commitment basis to
limit its exposure to falling prices. In periods of falling interest rates and
rising prices, the Fund might sell securities it owns and purchase the same or a
similar security on a when-issued or forward commitment basis, thereby obtaining
the benefit of currently higher yields. When-issued securities or forward
commitments involve a risk of loss if the value of the security to be purchased
declines prior to the settlement date.
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The value of securities purchased on a when-issued or forward
commitment basis and any subsequent fluctuations in their value are reflected in
the computation of the Fund's net asset value starting on the date of the
agreement to purchase the securities, and the Fund is subject to the rights and
risks of ownership of the securities on that date. The Fund does not earn
interest on the securities it has committed to purchase until they are paid for
and delivered on the settlement date. When the Fund makes a forward commitment
to sell securities it owns, the proceeds to be received upon settlement are
included in the Fund's assets. Fluctuations in the market value of the
underlying securities are not reflected in the Fund's net asset value as long as
the commitment to sell remains in effect. Settlement of when-issued purchases
and forward commitment transactions generally takes place within two months
after the date of the transaction, but the Fund may agree to a longer settlement
period.
The Fund will make commitments to purchase securities on a
when-issued basis or to purchase or sell securities on a forward commitment
basis only with the intention of completing the transaction and actually
purchasing or selling the securities. If deemed advisable as a matter of
investment strategy, however, the Fund may dispose of or renegotiate a
commitment after it is entered into. The Fund also may sell securities it has
committed to purchase before those securities are delivered to the fund on the
settlement date. The Fund may realize a capital gain or loss in connection with
these transactions, and its distributions from any net realized capital gains
will be taxable to shareholders.
When the Fund purchases securities on a when-issued or forward
commitment basis, the Fund or its custodian will maintain in a segregated
account cash or liquid securities having a value (determined daily) at least
equal to the amount of the Fund's purchase commitments. These procedures are
designed to ensure that the Fund will maintain sufficient assets at all times to
cover its obligations under when-issued purchases and forward commitments.
INVESTMENT RESTRICTIONS
The Fund has adopted the following investment restrictions, which
may not be changed without approval of the holders of a majority of its
outstanding shares (a term which in this Statement of Additional Information
means the lesser of (i) 67% or more of the shares present at a meeting if the
holders of more than 50% of the outstanding shares of the Fund are present or
represented by proxy or (ii) more than 50% of the outstanding shares of the
Fund). So long as these fundamental restrictions are in effect, the Fund may
not:
1. Purchase or sell real estate including securities of real estate
limited partnerships, but the Fund may invest in securities of companies engaged
in the real estate business.
2. Issue senior securities except as permitted by the Investment
Company Act of 1940, as amended, and except that the Fund may issue shares of
its beneficial interest in multiple classes or series, or borrow amounts in
excess of 33% of its total assets (including the amount borrowed) and then only
as a temporary measure for extraordinary or emergency purposes.
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3. Make loans, except that this restriction shall not prohibit the
making of securities loans, the purchase of or investment in bank certificates
of deposits or bankers acceptances, the purchase and holding of all or a portion
of an issue of publicly distributed debt securities, or the entry into
repurchase agreements.
4. Engage in the business of underwriting securities of others,
except to the extent that the Fund may be deemed to be an underwriter under the
Securities Act of 1933, as amended, when it purchases or sells portfolio
securities in accordance with its investment objective and policies; provided,
however, that the Fund may invest all or part of its investable assets in an
open-end investment company with substantially the same investment objective,
policies, and restrictions as the Fund.
5. Purchase securities, excluding U.S. Government securities, of one
or more issuers conducting their principal business activity in the same
industry, if immediately after such purchase the value of its investments in
such industry would exceed 25% of its total assets; provided, however, that the
Fund may invest all or part of its investable assets in an open-end investment
company with substantially the same investment objective, policies, and
restrictions as the Fund.
6. Invest in commodities or in commodities contracts except that the
Fund may purchase and sell financial futures contracts on the S&P 500 and
related options, and the Fund may purchase securities on a when-issued, stand-by
or forward commitment basis.
7. With respect to 75% of its total assets, purchase any security,
if as a result: (i) more than 5% of its total assets would be invested in
securities of any one issuer (excluding securities issued or guaranteed by the
U.S. Government, its agencies or instrumentalities), or (ii) the Fund would own
more than 10% of the voting securities of any issuer; provided, however, that
the Fund may invest all or part of its investable assets in an open-end
investment company with substantially the same investment objective, policies,
and restrictions as the Fund.
In addition to the fundamental policies mentioned above, the Board
has adopted the following non-fundamental policies which may be changed or
amended by action of the Board without approval of shareholders. So long as
these non-fundamental restrictions are in effect, the Fund may not:
(a) Invest in the securities of an issuer for the purpose of
exercising control or management, but it may do so where it is deemed advisable
to protect or enhance the value of an existing investment.
(b) Purchase securities of any other investment company except as
permitted by the Investment Company Act.
(c) Purchase securities on margin, except any short-term credits
which may be necessary for the clearance of transactions and the initial or
maintenance margin in connection with options and futures contracts and related
options.
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(d) Invest more than 15% of its net assets in securities which are
illiquid.
(e) Purchase additional securities if the Fund's borrowings exceed
5% of its net assets.
All percentage limitations (except for limitations on borrowing)
apply only at the time a transaction is entered into. Accordingly, if a
percentage restriction is adhered to at the time of investment, a later increase
or decrease in the percentage which results from a relative change in values or
from a change in the Fund's net assets will not be treated as a violation.
INVESTMENT ADVISER AND ADMINISTRATOR
INVESTMENT ADVISER
As stated in the Prospectus, Weiss, Peck & Greer L.L.C., One New
York Plaza, New York, New York 10004 ("WPG" or the "Adviser"), serves as
investment adviser to the Fund.
On or about September 9, 1998, Robeco Groep N.V., a Dutch public
limited liability company ("Robeco"), acquired all of the outstanding equity
interests of the Adviser from its prior owners (the "Acquisition"). As a result
of the Acquisition, the Adviser is an indirect, wholly-owned subsidiary of
Robeco. Robeco is a Dutch corporation that was formed to be the holding company
for 100% of the shares of Robeco International B.V. and Robeco Nederland B.V.
("Robeco Nederland") (collectively referred to as the "Robeco Group").
Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., Rabobank Nederland owns
50% of the shares of Robeco and the balance is owned by
shareholders of the Robeco Group funds.
The Robeco Group is a fund management group. Robeco Nederland
advises and manages investment funds, some of whose shares are traded primarily
on the Amsterdam Stock Exchange, which funds include (1) Robeco N.V., (2)
Rolinco N.V., (3) Rorento N.V., (4) RG Rente Mixfund N.V., (5) RG Obligarie
Mixfund N.V., (6) RG Aandelen Mixfund N.V., (7) RG Florente Fund N.V., (8) RG
Divirente Fund N.V., (9) RG America Fund N.V., (10) RG Europe Fund N.V., (11) RG
Pacific Fund N.V., (12) Nettorente Fund N.V., (13) RG Hollands Bezit N.V., (14)
RG Emerging Markets Fund N.V., (15) RG Tactimix Funds, and (16) RG Zelfselect
Landen Fund N.V. Robeco Nederland also advises and manages a number of
institutional funds. The Robeco Group operates primarily outside of the United
States, although it currently holds significant ownership interests in three
U.S.
investment advisers, in addition to being the parent company of WPG.
The Robeco Group. through its subsidiaries, has approximately
2500 employees worldwide. Of the approximately $95 billion in assets under
management at December 31, 1998, approximately $44 billion was managed in the
U.S.
In connection with the Acquisition, the Board of Trustees of the
Fund, including a majority of the Trustees who are not "interested persons" (as
such term is defined in the 1940 Act) of the Fund or the Adviser (the
"Independent Trustees"), approved the Fund's current investment advisory
agreement (the "Agreement") at a meeting held on May 19, 1998. The Agreement was
approved by a
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"majority of the outstanding voting securities" (as defined in the 1940 Act) of
the Fund at a special meeting of shareholders held on July 29, 1998, and became
effective upon the consummation of the Acquisition. Except for the dates of
execution, effectiveness and termination, the terms of the Agreement are
substantially identical to the terms of the investment advisory agreement which
was in effect immediately prior to the Acquisition.
Pursuant to the Agreement, the Adviser supervises and assists in the
management of the assets of the Fund and furnishes the Fund with research,
statistical, advisory and managerial services. The Adviser also pays the
compensation of all Trustees who are "interested persons" (as defined in the
Investment Company Act) of the Adviser except for Mr. Alan Werba, who is
compensated by Reinhardt Werba Bowen.
The Fund pays administration fees, taxes, brokerage fees and
commissions on portfolio transactions, interest, legal and accounting fees,
organizational expenses of the Fund, fees of custodians and transfer agents,
costs of share certificates, costs in connection with annual or special meetings
of shareholders, including the preparation and distribution of proxy materials,
costs in connection with the preparation and distribution of periodic reports to
shareholders, insurance premiums, expenses of an extraordinary and nonrecurring
nature, the compensation of non-executive employees of the Fund and fees of
Trustees who are not "interested persons" of the Adviser.
For its investment advisory services under the Agreement, the
Adviser is entitled to receive a monthly fee equal on an annual basis to a
percentage of the Fund's average daily net assets as follows: 0.26% up to $500
million, 0.24% from $500 million to $1 billion, 0.22% from $1 billion to $2
billion, and 0.20% thereafter. For the fiscal years ended December 31, 1996 ,
1997 and 1998, the Fund paid under its prior advisory agreement with the Adviser
the Adviser advisory fees of $545,737 , $503,366 and $298,867, respectively,
after the expense limitation. Had the Adviser not voluntary agreed to limit
the Fund's expenses, the Fund would have paid the Adviser advisory fees of
$547,177 , $539,408 and $500,974, respectively. Prior to April 1, 1996, the Fund
paid an advisory fee equal on an annual basis to a percentage of the Fund's
average daily net assets as follows: 0.31% up to $200 million, 0.26% from $200
million to $500 million, 0.24% from $500 million to $1 billion, 0.22% from $1
billion to $2 billion, and 0.20% thereafter.
The advisory fee is accrued daily and will be prorated if the
Adviser shall not have acted as the Fund's investment adviser during any entire
monthly period. The Adviser has agreed to limit total fund operating expenses to
certain levels, as further described under "Management of the Fund" in the
Fund's Prospectus.
The Agreement provides that the Adviser will not be liable for any
loss sustained by the Fund by reason of the adoption or implementation of any
investment policy or the purchase, sale or retention of any security, whether or
not such purchase, sale or retention shall have been based upon the
investigation and research of the Adviser, or upon investigation and research
made by any other individual, firm or corporation if such recommendation shall
have been made and such other individual, firm or corporation shall have been
selected with due care and in good faith, except for a loss resulting from
willful misfeasance, bad faith, or gross negligence in the performance by the
Adviser of its duties or by reason of the Adviser's reckless disregard of its
obligations and duties thereunder.
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The Agreement may be modified or amended only with the approval of
the holders of a "majority of the outstanding voting securities" (as defined in
the 1940 Act) of the Fund and by a vote of the majority of the Independent
Trustees of the Fund. The Agreement's continuance after its initial two-year
term must be approved annually by a vote of the majority of the Trustees or by a
vote of the holders of a "majority of the outstanding voting securities" of the
Fund, cast in person at a meeting called for the purpose of voting on such
approval. The Agreement may be terminated without penalty, by either party, upon
not more than 60 days' written notice and will terminate automatically in the
event of its assignment.
As of December 31, 1998, WPG had capital of approximately $[72]
million. WPG consists of 33 Managing Directors, one of whom is a member of the
NYSE and certain principals. WPG has approximately 250 full-time employees in
addition to its Managing Directors. As of December 31, 1998, WPG and its
affiliates had assets under management of approximately $[16] billion, primarily
for institutions and high net worth individuals.
Roger J. Weiss is a Senior Managing Director of WPG and Chairman of
the Board of Trustees of the Fund. [______________] is a Managing Director of
WPG and Executive Vice President and Treasurer of the Fund. [_____________] is a
Managing Director of WPG and an Executive Vice President and Secretary of the
Fund. The Managing Directors of WPG who serve on WPG's executive committee are
Stephen H. Weiss (Chairman), Roger J. Weiss, Constant Korthout, Phillip Greer,
Ronald M. Hoffner, Wesley W. Lang, Jr., Mitchell E. Cantor and Gil Cogan.
The person responsible for the day-to-day management of the Fund's
portfolio is Daniel J. Cardell. Messrs. Stephen H. Weiss and Roger J. Weiss may
also participate in the Fund's investment decisions and all of the managing
directors in WPG consult on a regular basis among themselves about general
market conditions, as well as specific securities and industries.
In addition to the Fund, the Adviser acts as the investment adviser
to each fund in the Weiss, Peck & Greer Group of Funds.
In the management of the Fund and its other accounts, the Adviser
and its subsidiaries allocate investment opportunities to all accounts for which
they are appropriate subject to the availability of cash in any particular
account and the final decision of the individual or individuals in charge of
such accounts. Where market supply is inadequate for a distribution to all such
accounts, securities are allocated on a pro rata basis. In some cases this
procedure may have an adverse effect on the price or volume of the security as
far as the Fund is concerned. However, it is the judgment of the Board that the
desirability of continuing the Fund's advisory arrangements with the Adviser
outweighs any disadvantages that may result from contemporaneous transactions.
See "Portfolio Brokerage."
ADMINISTRATOR
WPG, in its capacity of the Fund's administrator, performs
administrative, transfer agency related and shareholder relations services and
certain clerical and accounting services for the Fund (to the extent not
provided by other service providers) under an administration agreement dated May
19, 1993 (the "Administration Agreement"). More specifically, these obligations
-12-
<PAGE>
include, subject to the general supervision of the Board, (a) providing
supervision of all aspects of the Fund's non-investment operations (the parties
giving due recognition to the fact that certain of such operations are performed
by others pursuant to agreements with the Fund), (b) providing the Fund to the
extent not provided pursuant to such agreements, for the preparation, at the
Fund's expense, of its tax returns, reports to shareholders, periodic updating
of the prospectuses and reports filed with the Securities and Exchange
Commission (the "SEC") and other regulatory authorities, (c) providing, to the
extent not provided pursuant to other agreements, the Fund with personnel to
perform such executive, administrative, accounting and clerical services as are
reasonably necessary to provide effective administration of the Fund, (d)
providing the Fund, to the extent not provided pursuant to such agreements, with
adequate office space and certain related office equipment and services, (e)
maintaining all of the Fund's records other than those maintained pursuant to
such agreements or the Advisory Agreement, and (f) providing to the Fund, to the
extent not provided pursuant to other agreements, transfer agency-related and
shareholder relations services and facilities and the services of one or more of
its employees or officers, or employees or officers of its affiliates, relating
to such functions (including salaries and benefits, office space and supplies,
equipment and training).
For its services under the Administration Agreement, WPG currently
does not receive any compensation, although the Board may in the future decide
to compensate WPG for the provisions of administrative services.
The Fund pays: (i) fees and expenses of any investment adviser or
administrator of the Fund; (ii) organization expenses of the Fund; (iii) fees
and expenses incurred by the Fund in connection with membership in investment
company organizations; (iv) brokers' commissions; (v) payment for portfolio
pricing services to a pricing agent, if any, (vi) legal, accounting or auditing
expenses (including an allocable portion of the cost of WPG's employees
rendering legal services to the Fund); (vii) interest, insurance premiums, taxes
or governmental fees; (viii) the fees and expenses of the transfer agent of the
Fund; (ix) the cost of preparing stock certificates or any other expenses,
including, without limitation, clerical expenses of issue, redemption or
repurchase of shares of the Fund; (x) the expenses of and fees for registering
or qualifying shares of the Fund for sale and of maintaining the registration of
the Fund as a broker or a dealer; (xi) the fees and expenses of Trustees of the
Fund who are not affiliated with the Adviser or RWB; (xii) the cost of preparing
and distributing reports and notices to shareholders, the SEC and other
regulatory authorities; (xiii) the fees or disbursements of custodians of the
Fund's assets, including expenses incurred in the performance of any obligations
enumerated by the Declaration of Trust or By-Laws of the Fund insofar as they
govern agreements with any such custodian; (xiv) costs in connection with annual
or special meetings of shareholders, including proxy material preparation
printing and mailing; and (xv) litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of the Fund's
business.
The Fund's Advisory and Administration Agreements each provide that
WPG, in its capacities as investment adviser and administrator, may render
similar services to others so long as the services provided thereunder are not
impaired thereby.
In an attempt to avoid any potential conflict with portfolio
transactions for the Fund, WPG and the Fund have adopted extensive restrictions
on personal securities trading by personnel of WPG and its affiliates. These
restrictions include: pre-clearance of all personal securities transactions and
a prohibition of purchasing initial public offerings of securities. These
restrictions are a continuation of the basic principle that the interests of the
Fund and its shareholders come before those of WPG and its managing directors
and employees.
-13-
<PAGE>
PRINCIPAL UNDERWRITER
First Data Distributors, Inc., P.O. Box 60448, King of Prussia, PA
19406-0448 (the "Underwriter") serves as the principal underwriter in connection
with the continuous offering of shares of the Fund pursuant to an Underwriting
Agreement dated August 1998. The Underwriting Agreement's continuance after its
initial two-year term must be approved annually by the Trustees, including a
majority of the Independent Trustees, cast in person at a meeting called for the
purpose of voting on such approval. The Underwriting Agreement was approved by
the Trustees at a meeting held on July 22, 1998. As the Fund's principal
underwriter, the Underwriter performs certain services related to the
distribution of shares of the Fund to the public.
The Underwriter bears all expenses in providing services under the
Underwriting Agreement. The Underwriter also pays certain expenses in connection
with the distribution of the Fund's shares, including the cost of preparing,
printing and distributing advertising materials, and the cost of printing and
distributing prospectuses and supplements to prospective shareholders. The Fund
bears, among other things, the cost of registering its shares under federal,
state and foreign securities law.
TRUSTEES AND OFFICERS
The Board has responsibility for management of the business of the
Fund. The executive officers of the Fund are responsible for its day to day
operation. The Trustees and officers of the Fund are as follows:
<TABLE>
<CAPTION>
NAME, ADDRESS AND POSITION(S) PRINCIPAL OCCUPATIONS DURING PAST
DATE OF BIRTH HELD FIVE YEARS
------------- ---- ----------
<S> <C> <C>
Roger J. Weiss* Chairman of the Senior Managing Director, WPG; Chairman
One New York Plaza Board and of the Board of all WPG Funds and
New York, NY 10004 Trustee Tomorrow Funds Retirement Trust;
President, Weiss, Peck & Greer International
Fund; Former Executive Vice President and
4/29/39 Director, WPG
Advisers, Inc.; Former
Executive Vice President and Director,
Tudor Management Company
-14-
<PAGE>
NAME, ADDRESS AND POSITION(S) PRINCIPAL OCCUPATIONS DURING PAST
DATE OF BIRTH HELD FIVE YEARS
------------- ---- ----------
Raymond R. Herrmann, Jr.** Trustee Chairman of the Board, Sunbelt Beverage
654 Madison Avenue Corporation (distributor of wines and
Suite 1400 liquors); Former Vice Chairman and
New York, NY 10017 Director, McKesson Corporation (U.S
distributor of drugs and health care products,
9/11/20 wine and spirits); Life Member, Board of
Overseers of Cornell Medical College;
Member of Board and Executive Committee,
Sky Ranch for Boys; Member, Evaluation
Advisory Board, Biotechnology Investments,
Ltd.; Trustee of all WPG Funds and
Tomorrow Funds Retirement Trust
Lawrence J. Israel** Trustee Private Investor; Director and Trustee of the
Touro Infirmary; Member of the
200 Broadway, Suite 249 Intercollegiate Athletics Committee of the
New Orleans, LA 70018 Administrators of the
Tulane Educational
12/13/34 Fund; Trustee of all WPG Funds and
Tomorrow Funds
Retirement Trust
Graham E. Jones** Trustee Senior Vice President, BGK Realty Inc.,
330 Garfield Street since 1995;
Suite 200 Financial Manager, Practice
Santa Fe, NM 87501 Management
Systems (Medical Services
1/31/33 Company); Director, the Malaysia Fund;
Director, twelve closed-end funds managed
by Morgan Stanley Asset Management;
Trustee, various investment companies
managed by Morgan Grenfell Capital
Management, Inc. and Morgan Grenfell
Investment Services, Ltd., since 1993;
Trustee of all WPG Funds and Tomorrow
Funds Retirement Trust
-15-
<PAGE>
NAME, ADDRESS AND POSITION(S) PRINCIPAL OCCUPATIONS DURING PAST
DATE OF BIRTH HELD FIVE YEARS
------------- ---- ----------
Paul Meek** Trustee Financial and Economic Consultant to
5837 Cove Landing Road foreign central banks under the auspices of
Burke, VA 22015 each of the Harvard Institute for
International Development, the
11/12/25 International Monetary Fund
and the World
Bank; President, PM Consulting (financial
and economic consulting); Former
Consultant, Fischer, Francis, Trees & Watts
("FFTW") (fixed income investment
managers); Trustee, FFTW Funds;
Former Vice President and Monetary Adviser,
Federal Reserve Bank of New York; Trustee
of all WPG Funds
William B. Ross** Trustee Financial Consultant; Former Senior Vice
2733 E. Newton Avenue President, Mortgage
Shorewood, WI 53211 Guaranty Insurance
Corporation (mortgage credit insurer);
8/22/27 Investment Corporation (financial services
holding company); Trustee of all WPG Funds
Robert A. Straniere** Trustee Member, New York State Assembly; Sole
182 Rose Avenue Proprietor, Straniere Law Firm; Director,
Staten Island, NY 10306 various Reich and Tang Funds; Trustee of all
WPG Funds
3/28/41
Alan Werba* Trustee Director, Reinhardt Werba Bowen Advisory
Services (investment adviser); Registered
1190 Saratoga Avenue Principal, Royal Alliance Inc.
Suite 200 (broker-dealer)
San Jose, CA 95129 1991-1993; Registered Principal, Integrated
Resources
Equity Corporation (broker-dealer) 1998-1991
6/5/49
[__________________]* Executive Vice Managing Director, Weiss, Peck & Greer,
President and L.L.C.; [______________________]
One New York Plaza Treasurer Executive Vice President and Treasurer, of
New York, NY 10004 all WPG Funds and Tomorrow Funds
Retirement Trust
[______]
-16-
<PAGE>
NAME, ADDRESS AND POSITION(S) PRINCIPAL OCCUPATIONS DURING PAST
DATE OF BIRTH HELD FIVE YEARS
------------- ---- ----------
[__________________]* Executive Vice Managing Director, Weiss, Peck & Greer,
One New York Plaza President and L.L.C.; [______________________]
New York, NY 10004 Secretary
Executive Vice President and Secretary, of all
[______] WPG Funds and Tomorrow Funds
Retirement Trust
Daniel Cardell* Vice President(6) Managing Director, Weiss, Peck & Greer,
One New York Plaza L.L.C.; Senior Vice President and Director
New York, NY 10004 of Equities for the Bank of America prior
thereto
7/31/57
Joseph J. Reardon* Vice President Senior Vice
One New York Plaza President, Mutual
New York, NY 10004 Fund Operations,
Weiss, Peck & Greer,
4/4/60 L.L.C. since 1995
(Vice President since
December, 1993);
Manager, Mutual Fund
Operations, Weiss,
Peck & Greer, L.L.C.
from February, 1990
to December, 1993;
Vice President of all
WPG Funds and
Tomorrow Funds
Retirement Trust
Therese Hogan Assistant Manager,
First Data Investor Secretary State Regulation,
Services Group First Data Investor
53 State Street Services Group, Inc.
Boston, MA 02109 since June 1994;
Senior Legal
Assistant, Palmer &
Dodge prior thereto
2/27/62
- ------------------------
<FN>
* "Interested Person" within the meaning of the Investment Company Act.
** Member of the Audit Committee and the Special Nominating Committee.
</FN>
</TABLE>
COMPENSATION OF TRUSTEES AND OFFICERS
The Fund pays no compensation to its Trustees affiliated with the
Adviser or RWB, or its officers. None of the Fund's Trustees or officers have
engaged in any financial transactions with the Fund or the Adviser (except that
certain Trustees and officers who are managing directors of the Adviser may,
from time to time, purchase and sell ownership interests in the Adviser).
The following table sets forth all compensation paid to the Fund's
Trustees as of the Fund's fiscal year ended December 31, 1998:
-17-
<PAGE>
<TABLE>
<CAPTION>
TOTAL
PENSION OR COMPENSATION
AGGREGATE RETIREMENT BENEFITS FROM THE FUND
COMPENSATION ACCRUED AS PART OF OTHER FUNDS IN
NAME OF TRUSTEE FROM THE FUND FUND'S EXPENSES COMPLEX
--------------- ------------- --------------- -------
<S> <C> <C> <C>
Roger J. Weiss $0 $0 $0
Alan Werba 0 0 0
$29,000
Raymond R. Herrmann, Jr. $500 0
$29,000
Lawrence J. Israel $500 0
$23,375
Graham E. Jones $500 0
$21,500
Paul Meek $500 0
$21,500
William B. Ross $500 0
$19,125
Harvey E. Sampson** $500 0
Robert A. Straniere $500 0 21,500
- -----------------------
<FN>
* As of December 31, 1998, there were 12 mutual funds in the WPG
fund complex that publicly offer their shares. ** Effective April
23, 1998, Mr. Sampson was no longer a Trustee of the Fund.
</FN>
</TABLE>
CERTAIN SHAREHOLDERS
As of February __, 1999, no person within the knowledge of
management of the Fund or RWB owns of record or beneficially 5% or more of the
outstanding shares of the Fund, except that RWB held an aggregate of 99% of the
shares of the Fund in accounts of clients with respect to which RWB exercises
investment discretion and has the power to vote. RWB disclaims beneficial
ownership of all of such shares. As of such date, the officers and Trustees of
the Fund as a group owned, directly or indirectly, less than 1% of the shares of
the Fund.
HOW TO PURCHASE SHARES
SHARES OF THE FUND MAY BE PURCHASED ONLY BY CLIENTS OF RWB.
Clients of RWB pay an annual asset allocation fee to RWB at the rate
of 2% (or less on larger accounts) of the average monthly net assets under
management by RWB, including assets invested in the Fund. Financial institutions
utilized by RWB clients also charge certain service and transaction fees for
serving as record holders of shares of the Fund and other investments selected
by RWB for its clients. These fees, no part of which is received by the Fund or
the Adviser, are paid by RWB clients in addition to the expenses of the Fund.
The Fund is one of two mutual funds utilized by RWB to represent the Large Cap
U.S. Stocks class of assets.
-18-
<PAGE>
For additional information regarding purchases of shares of the
Fund, see the Fund's Prospectus.
The offering of shares of the Fund is continuous. The Fund may
terminate the continuous offering of its shares and may refuse to accept any
purchase order at any time at the discretion of its Trustees.
In the case of telephone subscriptions, if full payment for
telephone subscriptions is not received by the Fund within the customary time
period for settlement then in effect after the acceptance of the order by the
Fund, the order is subject to cancellation and the purchaser will be liable to
the Fund for any loss suffered as a result of such cancellation. To recoup such
loss the Fund may redeem shares owned by any shareholder whose purchase order is
cancelled for non-payment, and such purchaser may be prohibited from placing
further telephone orders.
The purchaser of the Fund's shares pays no sales load or
underwriting commission with respect to an investment in the Fund. If a
subscription or redemption is arranged and settlement made through a member of
the National Association of Securities Dealers, Inc. ("NASD"), then that member
may, in its discretion, charge a fee for this service.
Signature guarantees, when required, must be obtained from any one
of the following institutions, provided that such institution meets credit
standards established by the Fund: (i) a bank; (ii) a securities broker or
dealer, including a government or municipal securities broker or dealer, that is
a member of a clearing corporation or has net capital of at least $100,000;
(iii) a credit union having authority to issue signature guarantees; (iv) a
savings and loan association, a building and loan association, a cooperative
bank, or a federal savings bank or association; or (v) a national securities
exchange, a registered securities exchange or a clearing agency.
REDEMPTION OF FUND SHARES
The Fund will redeem shares at the net asset value of such shares
next determined after receipt of the redemption order by the applicable
financial institution, provided that such order is transmitted to the Fund (or
its agents) by its close of business. The redemption price, which may be more or
less than the price paid by the shareholder for his shares, is the net asset
value per share next determined
after a request for redemption in proper form is received by the Fund (or its
agents). Redemptions are taxable transactions for shareholders who are subject
to tax.
The redemption price may be paid in cash or portfolio securities, at
the Fund's discretion. The Fund has, however, elected to be governed by Rule
18f-1 under the Investment Company Act pursuant to which the Fund is obligated
to redeem shares solely in cash up to the lesser of $250,000 or 1% of the net
asset value of the Fund during any 90-day period for any one shareholder. Should
redemptions by any shareholder exceed such limitation, the Fund will have the
option of redeeming the excess in cash or portfolio securities. In the latter
case, the securities are taken at their value employed in determining the
redemption price and the shareholder may incur a brokerage charge when the
shareholder sells the securities he receives. The selection of such securities
will be made in such manner as the Board deems fair and reasonable.
-19-
<PAGE>
Payment for redeemed shares normally will be made after receipt from
the applicable financial institution of a request for redemption in proper form
within the time periods described in the Prospectus. Such payment may be
postponed, and the right of redemption suspended during any period when: (a)
trading on the NYSE is restricted as determined by the applicable rules and
regulations of the SEC or the NYSE is closed for other than weekends and
holidays; (b) the SEC has, by order, permitted such suspension; or (c) an
emergency, as defined by rules and regulations of the SEC exists, making
disposal of portfolio securities or valuation of net assets of the Fund not
reasonably practicable.
For additional information concerning Redemptions, see the
Prospectus.
SHAREHOLDER SERVICES
RWB provides account servicing functions for the Fund. These
services include but are not limited to: establishing and maintaining a
toll-free telephone number for investors to use in obtaining current account
information; providing to investors quarterly reports with respect to the Fund's
performance; and providing to investors upon request information concerning the
operation of the Fund and their investment in the Fund. In consideration of
these services, the Fund pays to RWB a fee equal, on an annual basis, to 0.10%
of the Fund's average daily net assets. For the year ended December 31, 1998,
the fee was paid in the amount of $192,682. Mr. Alan Werba, a Trustee of the
Fund, is a shareholder and Director of RWB.
NET ASSET VALUE
The net asset value of a share of the Fund is determined once daily,
Monday through Friday on each day the NYSE is open for regular trading (other
than a day during which no shares of the Fund were tendered for redemption and
no order to purchase or sell shares of the Fund was received by the Fund) in
which there is a sufficient degree of trading in the Fund's portfolio securities
to affect materially the Fund's net assets as of the close of regular trading on
the NYSE (normally 4:00 P.M., New York City time). The NYSE is normally closed
on the following national holidays: New Year's Day, Dr. Martin Luther King, Jr.
Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. Net asset value is determined by dividing
the value of the Fund's securities, cash and other assets (including dividends
accrued but not collected) less all its liabilities (including options and
accrued expenses but excluding capital and surplus), by the total number of
shares outstanding, the result being rounded to the nearest cent. In making such
determination, securities listed or admitted to trading on a national securities
exchange, are valued at their last sale on such exchange prior to the time of
determining net asset value; or if no sales are reported on such exchange on
that day, at the mean between the most recent bid and asked price. Unlisted
securities are valued at the mean between the most recent bid and asked prices.
Other securities and assets for which market quotations are not readily
available are valued at their fair value as determined in good faith by the
Valuation Committee as authorized by the Board.
The public offering price of the Fund's shares is the net asset
value per share next determined after receipt of an order.
-20-
<PAGE>
Orders for shares which have been received by the applicable
financial institution prior to the close of trading of the NYSE are confirmed at
the offering price effective at the close of the NYSE on that day provided that
the order is transmitted to the Fund (or its agents) by its close of business,
while orders received subsequent to such time will be confirmed at the offering
price effective at the close of the NYSE on the next day on which the net asset
value is calculated.
DIVIDENDS, DISTRIBUTIONS AND TAX STATUS
The Fund is subject to a 4% nondeductible federal excise tax on
amounts required to be but not distributed under a prescribed formula. The
formula requires that the Fund distribute (or be deemed to have distributed) to
shareholders during a calendar year at least 98% of the Fund's ordinary income
for the calendar year and at least 98% of the excess of its capital gains over
capital losses realized during the one-year period ending October 31 during such
year, as well as any income or gain (as so computed) from the prior calendar
year that was not distributed for such year and on which the Fund paid no
federal income tax.
A portion of the Fund's dividends may qualify for the 70%
dividends-received deduction for corporate shareholders. The portion of such
dividends which qualifies for such deduction is the portion, properly designated
by the Fund, which is derived from dividends of U.S. domestic corporations with
respect to shares held by the Fund that are not debt-financed and have been held
for tax purposes at least a minimum period, generally 46 days, extending before
and after each such dividend. For this purpose, the Fund's holding periods for
such shares may be reduced below the required minimum by certain futures
contracts or other positions that diminish its risk of loss with respect to such
shares. The dividends-received deduction for corporations will be reduced to the
extent the shares of the Fund with respect to which the dividends are received
are treated as debt-financed under the Code and will be eliminated if such
shares are deemed to have been held (for tax purposes) for less than the minimum
period referred to above with respect to each dividend. Shareholders will be
informed of the percentages of dividends which may qualify for the
dividends-received deduction. Section 1059 of the Code provides for a reduction
in a stock's basis for the untaxed portion (i.e., the portion qualifying for the
dividends-received deduction) of an "extraordinary dividend" if the stock has
not been held at least two years prior to the extraordinary dividend.
Extraordinary dividends are dividends paid during a prescribed period which
equal or exceed 10 percent (5 percent for preferred stock) of the recipient
corporation's adjusted basis in the stock of the payor or which meet an
alternative fair market value test. To the extent that dividend payments by the
Fund to its corporate shareholders constitute extraordinary dividends, such
shareholders' basis in their Fund shares will be reduced, and to the extent such
basis would be reduced below zero, current recognition of income may be
required.
The excess, if any, of a corporation's "adjusted current earnings"
over its alternative minimum taxable income includes the amount of dividends, if
any, excluded from income by virtue of the 70% dividends-received deduction
which may increase its alternative minimum tax liability.
Net investment income is the Fund's investment income less its
expenses. Dividends from net investment income, certain net realized foreign
currency gains, and the excess, if any, of net short-term capital gain over net
long-term capital loss of the Fund will be taxed to shareholders as ordinary
income and dividends from any net long-term capital gain in excess of net
short-term capital loss
-21-
<PAGE>
("capital gain dividends") will be taxed to shareholders as long-term capital
gain, for Federal income tax purposes. As a result of federal tax legislation
enacted on August 5, 1997 (the "Act"), gain recognized after May 6, 1997 from
the sale of a capital asset is taxable to individual (noncorporate) investors at
different maximum federal income tax rates, depending generally upon the tax
holding period for the asset, the federal income tax bracket of the taxpayer,
and the dates the asset was acquired and/or sold. The Treasury Department has
issued guidance under the Act that (subject to possible modification by future
"technical corrections" legislation) enables the Fund to pass through to its
shareholders the benefits of the capital gains rates enacted in the Act. The
Fund will provide appropriate information to its shareholders about the tax
rate(s) applicable to its capital gain dividends (if any) in accordance with
this and any future guidance. Shareholders should consult their own tax advisers
on the correct application of these new rules in their particular circumstances.
These distributions are paid after taking into account, and reducing the
distributions to the extent of, any capital loss carryforward of the Fund.
Long-term capital gains of the Fund are taxable to shareholders as capital gains
if they are either distributed in the form of capital gain dividends or retained
by the Fund and designated for treatment as capital gains distributed to the
shareholders. Capital gain dividends are not eligible for the dividends-received
deduction. If any net realized long-term capital gain in excess of net realized
short-term capital loss is retained by the Fund for reinvestment, requiring
federal income taxes to be paid thereon by the Fund, the Fund will elect to
treat such capital gains as having been distributed to shareholders. As a
result, each shareholder will report such capital gains as capital gains, will
be able to claim his share of federal income taxes paid by the Fund on such
gains as a credit against his own federal income tax liability, and will be
entitled to increase the adjusted tax basis of his Fund shares by the difference
between his pro rata share of such gains and his tax credit.
A regulated investment company qualifying under Subchapter M of the
Code is not subject to Federal income tax on distributed amounts to the extent
that it distributes for each taxable year its net investment income and net
realized capital gains in accordance with the timing and other requirements of
the Code. The Fund intends to qualify and be treated as a regulated investment
company for each taxable year. Qualification for treatment as a regulated
investment company under the Code requires, among other things, that (a) at
least 90% of the Fund's gross income for its taxable year, without offset for
losses from the sale or other disposition of stock or securities or other
transactions, be derived from interest, payments with respect to securities
loans, dividends and gains from the sale or other disposition of stock or
securities or foreign currencies, or other income (including but not limited to
gains from options, futures, or forward contracts) derived with respect to its
business of investing in such stock, securities or currencies; (b) the Fund
distribute for its taxable year (in accordance with the Code's timing and other
requirements) to its shareholders as dividends at least 90% of its net
investment income, certain net realized foreign currency gains and the excess of
net short-term capital gain over net long-term capital loss earned in such year
and any other net income (except for the excess, if any, of net long-term
capital gain over net short-term capital loss, which need not be distributed in
order for the Fund to qualify as a regulated investment company but is taxed to
the Fund if it is not distributed); and (c) the Fund diversify its assets so
that, at the close of each quarter of its taxable year, (i) at least 50% of the
fair market value of its total (gross) assets is comprised of cash, cash items,
U.S. Government securities, securities of other regulated investment companies
and other securities, with such other securities limited in respect of any one
issuer to no more than 5% of the fair market value of the Fund's total assets
and 10% of the outstanding voting securities of such issuer and (ii) no more
than 25% of the fair market value of its total assets is invested in the
securities of any one issuer (other than U.S. Government securities and
securities of other regulated investment companies) or of two or more issuers
controlled by the Fund and engaged in the same, similar, or related trades or
businesses.
-22-
<PAGE>
Dividends, including capital gain dividends, paid by the Fund
shortly after a shareholder's purchase of shares have the effect of reducing the
net asset value per share of his shares by the amount per share of the dividend
distribution. Although such dividends are, in effect, a partial return of the
purchase price to the shareholder, they will be subject to Federal income tax as
described above. Therefore, prior to purchasing shares an investor should
consider the impact of an anticipated dividend distribution.
Distributions from the Fund's current or accumulated earnings and
profits ("E&P"), as computed for Federal income tax purposes, will be taxable as
described above whether taken in shares or in cash. Distributions, if any, in
excess of E&P will constitute a return of capital, which will first reduce an
investor's tax basis in Fund shares and thereafter (after such basis is reduced
to zero) will generally give rise to capital gains. Shareholders electing to
receive distributions in the form of additional shares will have a cost basis
for Federal income tax purposes in the shares so received equal to the amount of
cash they would have received if they had elected to receive cash.
All futures contracts entered into by the Fund will be governed by
Section 1256 of the Code. Absent a tax election to the contrary, gain or loss
attributable to the delivery under or closing out of any such position will be
treated as 60% long-term and 40% short-term capital gain or loss, and on the
last trading day of the Fund's taxable year, all outstanding Section 1256
positions will be marked to market (i.e. treated as if such positions were
closed out at their closing price on that day), with any resulting gain or loss
recognized as 60% long-term and 40% short-term capital gain or loss. Under
certain circumstances, the tax straddle rules applicable to offsetting positions
in personal property may cause an adjustment in the holding period of the
underlying security or a substantially identical security in the Fund's
portfolio, or, in conjunction with rules of Section 1256, otherwise affect the
character or timing of the Fund's income, gain or loss and hence of its
distributions to shareholders.
All or a portion of a loss realized upon the redemption or other
disposition of Fund shares may be disallowed under "wash sale" rules to the
extent shares of the Fund are purchased (including shares acquired by means of
reinvested dividends) within a 61-day period beginning 30 days before and ending
30 days after such redemption or other disposition. Any loss realized upon the
sale, redemption or other disposition of shares with a tax holding period of six
months or less will be treated as a long-term capital loss to the extent of any
capital gain dividend with respect to such shares. Exchanges are treated as
redemptions for Federal tax purposes. Shareholders should consult their own tax
advisers regarding their particular circumstances to determine whether a
disposition of Fund shares is properly treated as a sale for tax purposes, as is
assumed in the foregoing discussion. Also, future Treasury Department guidance
issued to implement the Act may contain additional rules for determining the tax
treatment of sales of Fund shares held for various periods, including the
treatment of losses on the sale of shares held for six months or less that are
recharacterized as long-term capital losses, as described above. Different tax
treatment, including a penalty on certain distributions, excess contributions or
other transactions, is accorded to accounts maintained as IRAs or other
retirement plans. Investors should consult their tax advisers for more
information.
The Fund may be required to pay state taxes in a state that has
jurisdiction to tax it, except to the extent an exemption may be available for
an investment company like the Fund, but the Fund does not anticipate that its
state tax liability will be substantial.
The foregoing discussion of U.S. federal income tax relates solely
to the application of that law to U.S. persons, i.e., U.S. citizens and
residents and U.S. domestic corporations, partnerships, trusts and estates,
-23-
<PAGE>
subject to tax under such law. The discussion does not address special tax rules
applicable to certain classes of investors such as tax-exempt entities,
financial institutions, and insurance companies. Each shareholder who is not a
U.S. person should consider the U.S. and foreign tax consequences of ownership
of shares of the Fund, including the possibility that such a shareholder may be
subject to a U.S. withholding tax at a rate of 30% (or at a lower rate under an
applicable income tax treaty) on Fund distributions treated as ordinary
dividends and, unless an effective IRS Form W-8 or authorized substitute for
Form W-8 is on file, to 31% back-up withholding on certain other payments from
the Fund.
This discussion of the federal income tax treatment of the Fund and
its shareholders is based on the federal income tax law in effect as of the date
of this Statement of Additional Information. Investors should consult their own
tax advisers with respect to the application of the provisions of tax law
described in this statement of additional information and about the possible
application of state, local or foreign taxation in light of their particular tax
situations.
PORTFOLIO BROKERAGE
It is the general policy of WPG not to employ any broker in the
purchase or sale of securities for the Fund's portfolio unless WPG believes that
such broker will obtain the best execution for the Fund, taking into
consideration such relevant factors as price, the ability of the broker to
effect the transaction and the broker's facilities, reliability and financial
responsibility. Commission rates, being a component of price, are considered
together with such factors. Subject to the foregoing, where transactions are
effected on securities exchanges, the Fund employs WPG as principal broker.
Where transactions are effected in the over-the-counter market or a third
market, the Fund deals with the primary market makers unless a more favorable
result is obtainable elsewhere.
The commission rate on all exchange orders is subject to
negotiation. Section 17(e) of the Investment Company Act limits to "the usual
and customary broker's commission" the amount which can be paid by the Fund to
an affiliated person, such as WPG, acting as broker in connection with
transactions effected on a securities exchange. Rule 17e-1 under the Investment
Company Act stipulates that a commission, fee or other remuneration does not
exceed the usual and customary broker's commission if it is "reasonable and fair
compared to the commission, fee or other remuneration received by other brokers
in connection with comparable transactions involving similar securities being
purchased or sold on a securities exchange during a comparable period of time. .
. ." Rule 17e-1 also requires the Board, including a majority of the Trustees
who are not "interested persons" of the Fund or WPG, adopt procedures reasonably
designed to provide that the commission paid is consistent with the above
standard and determine at least quarterly that transactions have been effected
in compliance with those procedures. The Board, including a majority of the
Independent Trustees, has adopted procedures designed to comply with the
requirements of Rule 17e-1.
WPG acts as broker for the Fund on exchange transactions, subject,
however, to the general policy of the Fund set forth above and the procedures
adopted by the Board. Commissions paid to WPG must be at least as favorable as
those believed to be contemporaneously charged by other brokers in connection
with comparable transactions involving similar securities being purchased or
sold on a securities exchange. A transaction is not placed with WPG if the Fund
would have to pay a commission rate less favorable than WPG's contemporaneous
charges for comparable transactions for
-24-
<PAGE>
its other most favored, but unaffiliated, customers except for accounts for
which WPG acts as a clearing broker for another brokerage firm, and any
customers of WPG determined by a majority of the Trustees who are not
"interested persons" of the Fund, WPG and RWB not to be comparable to the Fund.
With regard to comparable customers, in isolated situations, subject to the
approval of a majority of the Trustees who are not "interested persons" of the
Fund, WPG and RWB, exceptions may be made. Since WPG has, as investment adviser
to the Fund, the obligation to provide management, which includes elements of
research and related skills, such research and related skills will not be used
by WPG as a basis for negotiating commissions at a rate higher than that
determined in accordance with the above criteria. When appropriate, orders for
the account may be combined with orders for the account of other funds and
accounts advised by WPG in order to obtain a more favorable commission rate.
When the same security is purchased for two or more funds on the same day, each
fund pays the average price and commissions paid are allocated in direct
proportion to the number of shares purchased.
In selecting brokers other than WPG to effect transactions on
securities exchanges, the Fund considers the factors set forth in the first
paragraph under this heading and any investment products or services provided by
such brokers, subject to the criteria of Section 28(e) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Section 28(e) specifies
that a person with investment discretion shall not be "deemed to have acted
unlawfully or to have breached his fiduciary duty" solely because such person
has caused the account to pay a higher commission than the lowest rate
available. To obtain the benefit of Section 28(e), the person so exercising
investment discretion must make a good faith determination that the commissions
paid are "reasonable in relation to the value of the brokerage and research
services provided viewed in terms of either that particular transaction or his
overall responsibilities with respect to the accounts as to which he exercises
investment discretion." Accordingly, if WPG determines in good faith that the
amount of commissions charged by a broker is reasonable in relation to the value
of the brokerage and research services provided by such broker, it may cause the
Fund to pay commissions to such broker in an amount greater than the amount
another firm might charge.
Research services may include (i) furnishing advice as to the value
of securities, the advisability of investing in, purchasing or selling
securities, and the availability of securities or purchases or sellers of
securities, (ii) furnishing seminars, information, analyses and reports
concerning issuers, industries, securities, trading markets and methods,
legislative developments, changes in accounting practices, economic factors and
trends, portfolio strategy, access to research analysts, corporate management
personnel, industry experts and economists, comparative performance evaluation
and technical measurement services and quotation services, and products and
other services (such as third party publications, reports and analysis, and
computer and electronic access, equipment, software, information and accessories
that deliver, process or otherwise utilize information, including the research
described above) providing lawful and appropriate assistance to WPG (and its
affiliates) in carrying out their decision-making responsibilities and (iii)
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). The investment advisory fees paid by the
Fund under the advisory agreements will not be reduced as a result of WPG's
receipt of research services.
Each year, WPG considers the amount and nature of the research
products and services provided by other brokers as well as the extent to which
such products and services are relied upon, and attempts to allocate a portion
of the brokerage business of its clients, such as the Fund, on the
basis of that consideration. In addition, brokers sometimes suggest a level of
business they would like to receive in return for the various services they
-25-
<PAGE>
provide. Actual brokerage business received by any broker may be less than the
suggested allocations, but can (and often does) exceed the suggestions, because
total brokerage is allocated on the basis of all the considerations described
above. In no instance is a broker excluded from receiving business because it
has not been identified as providing research products and services, although
the Fund may not be willing to pay the same commission to such a broker as the
Fund would have paid had the broker provided research products and services. As
permitted by Section 28(e), the investment information received from other
brokers may be used by WPG (and its affiliates) in servicing all its accounts
and not all such information may be used by WPG in connection with the Fund.
Nonetheless, the Fund believes that such investment information provides the
Fund with benefits by supplementing the research otherwise available to the
Fund.
As set forth above, the Fund employs WPG, a member firm of the NYSE,
as its principal broker on exchange transactions. Section 11(a) of the Exchange
Act provides that a member firm of a national securities exchange (such as WPG)
may not effect transactions on such exchange for the account of an investment
company (such as the Fund) of which the member firm or its affiliate (such as
WPG) is the investment adviser unless certain conditions are met. These
conditions require that the investment company authorize the practice and that
the investment company receive from the member firm at least annually a
statement of all commissions paid in connection with such transactions. WPG's
transactions on behalf of the Fund are effected in compliance with these
conditions.
In certain instances there may be securities which are suitable for
the Fund's portfolio as well as for that of one or more of the other clients of
WPG. Investment decisions for the Fund and for WPG's other clients are made with
a view to achieving their respective investment objectives. It may develop that
a particular security is bought or sold for only one client even though it might
be held by, or bought or sold for, other clients. Likewise, a particular
security may be bought for one or more clients when one or more other clients
are selling the same security. Some simultaneous transactions are inevitable
when several clients receive investment advice from the same investment adviser,
particularly when the same security is suitable for the investment objectives of
more than one client. When two or more clients are simultaneously engaged in the
purchase or sale of the same security, the securities are allocated among
clients in a manner believed to be equitable to each. It is recognized that in
some cases this system could have a detrimental effect on the price or volume of
the security in a particular transaction as far as the Fund is concerned. The
Fund believes that over time its ability to participate in volume transactions
will produce better executions for the Fund.
WPG furnishes to the Fund at least quarterly a statement setting
forth the total amount of all compensation retained by WPG or any associated
person of WPG in connection with effecting transactions for the account of the
Fund, and the Board reviews and approves all the Fund's portfolio transactions
and the compensation received by WPG in connection therewith.
WPG does not knowingly participate in commissions paid by the Fund
to other brokers or dealers and does not seek or knowingly receive any
reciprocal business as the result of the payment of such commissions. In the
event WPG at any time learns that it has knowingly received reciprocal business,
it will so inform the Board.
The Fund paid total brokerage commissions on purchases and sales of
portfolio securities for the years ended December 31, 1996 , 1997 and 1998, in
the amounts of $171,866 , $193,235 and $147,489, respectively, of which
-26-
<PAGE>
$171,866, $192,857 and $52,214, respectively, was received by WPG. The
percentage of the aggregate brokerage commissions paid by the Fund to WPG during
1998 was: 35%. The percentage of the aggregate dollar amount of transactions
involving the payment of commissions through WPG during 1998 was: 35%. To the
extent that WPG receives brokerage commissions on Fund portfolio transactions,
officers and Trustees of the Fund who are also directors in WPG may receive
indirect compensation from the Fund through their participation in such
brokerage commissions.
Subject to the supervision of the Board, all investment decisions of
the Fund are made by WPG, which places orders for all purchases and sales of
portfolio securities through WPG's trading department.
PORTFOLIO TURNOVER
The portfolio turnover rates of the Fund for the past five fiscal
years ended December 31 are set forth in the prospectus under "Financial
Highlights." The annual portfolio turnover rate is calculated by dividing the
lesser of the cost of purchases or proceeds from sales of portfolio securities
for the year by the monthly average of the value of the portfolio securities
owned by the Fund during the year. Such monthly average is calculated by
totaling the values of the portfolio securities as of the beginning and end of
the first month of the year and as of the end of the succeeding 11 months and
dividing the sum by 13. U.S. Government securities and all other securities the
maturities of which at the time of their acquisitions were one year or less are
excluded from the calculation of the annual portfolio turnover rate. A turnover
rate of 100% would occur if all of the Fund's portfolio securities were replaced
in a period of one year. Increased portfolio turnover results in increased
brokerage costs which the Fund must pay and the possibility of more net realized
short-term capital gains, distributions of which are taxable as ordinary income.
To the extent that its portfolio is traded for the short-term, the
Fund will be engaged essentially in trading operations based on short-term
market considerations as distinct from long-term investments based upon
fundamental valuation of securities. Because of this policy, portfolio
securities may be sold without regard to the length of time for which they have
been held.
ORGANIZATION
The Fund was formed on February 16, 1993 as a "business trust" under
the laws of Delaware. On May 1, 1996, the Fund changed its name from "U.S. Large
Stock Fund" to "RWB/WPG U.S.
Large Stock Fund."
Under the Declaration of Trust, the Fund is not required to hold
annual meetings to elect Trustees or for other purposes. It is not anticipated
that the Fund will hold shareholders' meetings unless required by law or the
Declaration of Trust. The Trust will be required to hold a meeting to elect
Trustees to fill any existing vacancies on the Board if, at any time, less than
a majority of the Trustees have been elected by the shareholders of the Fund.
The Board is required to call a meeting for the purpose of considering the
removal of persons serving as Trustee if requested in writing to do so by the
holders of not less than 10 percent of the outstanding shares of the Fund.
-27-
<PAGE>
Whenever ten or more shareholders of record (who have been such for at least six
months and who hold in the aggregate shares having a value of the lesser of
$25,000 or 1% of the Fund's net asset value) apply to the Trustees in writing
that they wish assistance in communicating with other shareholders for the
purpose of causing the Fund to call a meeting of shareholders to consider the
removal of Trustees, the Fund will so assist such shareholders in accordance
with Section 16(a) of the Investment Company Act.
The Fund's shares do not have cumulative voting rights, so that the
holders of more than 50% of the outstanding shares may elect all of the
Trustees, in which case the holders of the remaining shares would not be able to
elect any Trustees. Shareholders are entitled to one vote for each full share
held, and fractional votes for fractional shares held.
Each share of the Fund is entitled to such dividends and
distributions out of the income earned on the assets of the Fund as are declared
in the discretion of the Board. In the event of the liquidation or dissolution
of the Fund, shareholders of the Fund are entitled to receive their proportional
share of the assets which are available for distribution as the Trustees in
their sole discretion may determine. Shareholders are not entitled to any
preemptive or subscription rights. All shares, when issued, will be fully paid
and non-assessable by the Fund.
Pursuant to the Declaration of Trust, the Board may create
additional funds by establishing additional series of shares in the Fund. The
establishment of additional series would not affect the interests of current
shareholders in the existing Fund. The Board may also divide the shares of the
Fund or any series into classes, which classes shall have such rights, terms and
preferences as the Trustees may establish.
Upon the initial purchase of shares, the shareholder agrees to be
bound by the Fund's Declaration of Trust, as amended from time to time.
PERFORMANCE INFORMATION
The Fund will calculate performance on a total return basis, which
combines principal and dividend income changes, for various periods. Principal
changes are based on the difference between the initial offering price and the
closing net asset value per share for the period and assume reinvestments of
dividends. Dividend income is the capital gains and income dividends paid by the
Fund during the period.
Performance will vary from time to time and past results are not
necessarily representative of future results. Performance is a function of
portfolio management and is affected by operating expenses. Performance
information may not provide a basis for comparison with other investments or
other investment companies using a different method of calculating performance.
Comparative performance information may be used from time to time in
advertising the Fund's shares, including data from Lipper Analytical Services,
Inc., Morningstar, Inc., Standard & Poor's Index of 500 Stocks, the Dow Jones
Industrial Average, the Value Line Composite Index, the NASDAQ OTC Composite
Index, and other industry publications.
The average annual total return of the Fund is determined for a
particular period by calculating the actual dollar amount of the investment
return on a $1,000 investment in the Fund made
at the maximum public offering price (net asset value) at the beginning of the
-28-
<PAGE>
period, and then calculating the annual compounded rate of return which would
produce that amount. Total return for a period of one year is equal to the
actual return of the Fund during that period. This calculation assumes that all
dividends and distributions are reinvested at net asset value on the
reinvestment dates during the period.
The Fund's results assume the reinvestment of all capital gain
distributions and income dividends.
Performance information for the Fund is set forth below:
PERFORMANCE SUMMARY
FROM 6/8/93
(COMMENCEMENT
FOR THE YEAR FOR THE FIVE OF OPERATIONS)
RWB/WPG U.S. ENDED 12/31/98 PERIOD ENDED 12/31/98 TO 12/31/98
------------ -------------- --------------------- -----------
Large Stock Fund 24.49% 21.07% 19.81%
CUSTODIAN
The custodian for the Fund is Boston Safe Deposit and Trust Company,
One Exchange Place, Boston, Massachusetts 02109. In its capacity as custodian,
Boston Safe Deposit and Trust Company performs all accounting services, holds
the assets of the Fund and is responsible for calculating the daily net asset
value per share.
TRANSFER AGENT
First Data Investor Services Group, Inc. acts as Transfer Agent and
Dividend Paying Agent for the Fund.
INDEPENDENT AUDITORS
KPMG LLP, 345 Park Avenue, New York, NY 10154, serves as the Fund's
independent accountants and in that capacity audits the Fund's annual financial
statements.
FINANCIAL STATEMENTS
The Statement of Assets and Liabilities, including the Schedule of
Investments, as of December 31, 1998, and the related Statement of Operations
for the year then ended, the Statement of Changes in Net Assets for each of the
years in the two-year period then ended, and the Financial Highlights and the
Report of KPMG LLP, independent auditors, each of which is included in the
Annual Report to Shareholders of the Fund for December 31, 1998, are hereby
attached to and incorporated by reference into this Statement of Additional
Information.
-29-
<PAGE>
-------------
RWB/WPG
U.S. LARGE
STOCK FUND
-------------
ANNUAL REPORT
DECEMBER 31, 1998
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1998
<TABLE>
<CAPTION>
NUMBER VALUE
OF SHARES SECURITY (000'S)
- --------- -------- -------
COMMON STOCKS (100.3%)
BASIC MATERIALS (3.1%)
<C> <S> <C>
130,000 +Bethlehem Steel Corp. ......................... $1,089
25,700 du Pont E I de Nemours & Co. .................. 1,447
11,600 Fort James Corp. .............................. 464
41,400 Kimberly-Clark Corp. .......................... 2,256
13,700 Oneok Inc. .................................... 495
---------
5,751
---------
CONSUMER CYCLICALS (8.2%)
16,500 Armstrong World Industries Inc. ............... 995
20,077 +DaimlerChrysler AG ........................... 1,929
32,000 Dayton Hudson Corp. ........................... 1,736
46,000 Ford Motor Co. ................................ 2,700
22,000 Gannet Inc. ................................... 1,419
7,100 Goodyear Tire & Rubber Co. .................... 358
8,100 Knight Ridder Inc. ............................ 414
8,500 Lowes Corp. ................................... 835
39,450 Mattel Inc. ................................... 900
36,000 May Department Stores Co. ..................... 2,174
12,400 Maytag Corp. .................................. 772
24,600 Penny (J.C.) Co. .............................. 1,153
---------
15,385
---------
CONSUMER NON-CYCLICALS (10.2%)
46,000 Avon Products Inc. ............................ 2,035
44,800 Campbell Soup Co. ............................. 2,464
50,300 Coca Cola Co. ................................. 3,364
11,800 General Mills Inc. ............................ 917
42,600 Great Atlantic & Pacific Tea .................. 1,262
32,350 Heinz H J Co. ................................. 1,832
91,500 Philip Morris Companies Inc. .................. 4,895
38,800 Sara Lee Corp. ................................ 1,094
50,100 Wendy's International ......................... 1,093
---------
18,956
---------
CONSUMER SERVICES (3.8%)
50,200 +General Nutrition Companies Inc. .............. 816
38,600 Intimate Brands Inc. .......................... 1,153
75,200 King World Productions Inc. ................... 2,214
25,600 +MediaOne Group Inc. ........................... 1,203
17,800 New York Times Corp. - Cl A ................... 617
33,300 +Promus Hotel Corp. ............................ 1,078
---------
7,081
---------
ENERGY (7.0%)
28,000 Coastal Corp. ................................. 978
81,700 Exxon Corp. ................................... 5,974
105,900 Royal Dutch Petroleum Co. ADR ................. 5,070
20,900 Schlumberger Ltd .............................. 964
---------
12,986
---------
NUMBER VALUE
OF SHARES SECURITY (000'S)
- --------- -------- -------
FINANCIAL (14.5%)
56,200 Allstate Corp. ................................ $2,171
49,500 Bankboston Corp. .............................. 1,927
53,460 Bank One Corp. ................................ 2,730
40,300 Bear Stearns Companies Inc. ................... 1,506
51,800 Chase Manhattan Corp. ......................... 3,526
20,200 Countrywide Credit Industries ................. 1,014
20,700 Federal National Mortgage
Association ................................. 1,532
49,000 First Union Corp. ............................. 2,980
16,900 Golden West Financial ......................... 1,550
40,300 PNC Bank ...................................... 2,181
13,000 SAFECO Corp. .................................. 558
33,950 SLM Holding Corp. ............................. 1,630
12,200 St Paul Companies Inc. ........................ 424
24,500 The PMI Group Inc. ............................ 1,210
5,300 Transamerica Corp. ............................ 612
44,619 U.S. Bancorp .................................. 1,584
---------
27,135
---------
HEALTH CARE (13.3%)
88,600 Abbott Laboratories ........................... 4,341
73,200 Bristol-Myers Squibb Co. ...................... 9,795
105,600 Schering-Plough Corp. ......................... 5,834
28,300 Tenet Healthcare Corp. ........................ 743
56,100 Warner Lambert Co. ............................ 4,218
---------
24,931
---------
INDUSTRIALS (8.2%)
29,300 Aeroquip Vickers Inc. ......................... 877
25,300 Browning Ferris Industries Inc. ............... 719
8,600 Caterpillar Inc. .............................. 396
13,400 Cooper Industries Inc. ........................ 639
52,500 +Cytec Industries Inc. ......................... 1,116
70,000 General Electric .............................. 7,144
15,900 Interpublic Group of
Companies Inc. ............................. 1,268
14,625 Parker Hannifin Corp. ......................... 479
19,500 Raytheon Corp. - Cl B ......................... 1,038
9,600 Stanley Works ................................. 266
27,700 Sundstrand Corp. .............................. 1,437
---------
15,379
---------
See notes to financial statements
Page 2
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
SCHEDULE OF INVESTMENTS AT DECEMBER 31, 1998
NUMBER VALUE
OF SHARES SECURITY (000'S)
- --------- -------- -------
TECHNOLOGY (23.2%)
33,600 Cadence Design Systems Inc. ................... $1,000
33,750 +Cisco Systems ................................. 3,132
111,000 +Dell Computer Corp. ........................... 8,124
37,700 First Data Corp. .............................. 1,195
9,800 General Dynamics Corp. ........................ 575
43,300 GTE Corp. ..................................... 2,814
36,300 Intel Corp. ................................... 4,304
23,200 International Business
Machines Corp. ................................ 4,286
46,400 Lucent Technologies ........................... 5,104
44,600 Microsoft Corp. ............................... 6,185
40,000 +Oracle Systems ................................ 1,725
33,299 US West Inc. .................................. 2,152
22,700 Xerox Corp. ................................... 2,679
---------
43,275
---------
TRANSPORTATION (1.0%)
14,800 +AMR Corp. ..................................... 879
30,600 Burlington Northern Santa Fe .................. 1,033
---------
1,912
---------
UTILITIES (7.8%)
37,100 Baltimore Gas & Electric Co. .................. 1,141
40,700 Bell Atlantic Corp. ........................... 2,157
61,200 Entergy Corp. ................................. 1,905
31,600 GPU Inc. ...................................... 1,396
149,975 SBC Communications ............................ 8,042
---------
14,641
---------
TOTAL INVESTMENTS (100.3%)
(Cost $114,113) .............................. 187,432
LIABILITIES IN EXCESS
OF OTHER ASSETS (-0.3%) ..................... (536)
---------
TOTAL NET ASSETS (100.0%) ..................... $186,896
==========
<FN>
+ Non-income producing securities.
</FN>
</TABLE>
See notes to financial statements
Page 3
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
STATEMENT OF ASSETS AND LIABILITIES AT DECEMBER 31, 1998
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments at value (Cost $114,112,923) ...................... $ 187,432,370
Dividends and interest receivable ............................. 221,027
Receivable for Fund shares sold ............................... 97,297
Other assets .................................................. 9,208
-------------
187,759,902
-------------
Liabilities:
Payable to custodian bank ..................................... 465,932
Payable for management fee (Note 2) ........................... 22,223
Payable for shareholder servicing fee (Note 2) ................ 15,575
Distributions payable ......................................... 8,850
Payable for Fund shares redeemed .............................. 310,838
Accrued expenses .............................................. 40,216
-------------
863,634
-------------
NET ASSETS .................................................... $ 186,896,268
=============
NET ASSETS REPRESENTED BY:
Shares of beneficial interest, at par ......................... $ 24,493
Paid-in surplus ............................................... 112,406,975
Undistributed net investment income ........................... 463,050
Undistributed net realized gains on investments and futures ... 682,303
Net unrealized appreciation on investments .................... 73,319,447
-------------
Net Assets applied to 24,493,459 shares of beneficial interest
with $0.001 par value (authorized shares unlimited) ......... $ 186,896,268
=============
UNREALIZED APPRECIATION\(DEPRECIATION)*
Gross appreciation ......................................... $ 74,547,194
Gross depreciation ......................................... (1,227,747)
-------------
Net unrealized appreciation ................................... $ 73,319,447
=============
Net asset value, offering and redemption price per share
as of the close of business on December 31, 1998 ......... $ 7.63
=============
<FN>
* Based on cost of securities for book purposes which does not differ
significantly from Federal income tax cost.
</FN>
</TABLE>
See notes to financial statements
Page 4
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Dividends ........................................... $ 3,116,396
Interest ............................................ 28,577
------------
$ 3,144,973
EXPENSES:
Investment advisory fee (Note 2) .................... 500,974
Shareholder service fee (Note 2) .................... 192,682
Fund Accounting expense ............................. 78,561
Professional fees ................................... 68,372
Custodian fees and expenses (Note 5) ................ 64,626
Transfer agent fee and expenses ..................... 34,060
Registration fees ................................... 26,597
Shareholder reports ................................. 15,651
Organization costs .................................. 5,465
Trustees' fees and expenses ......................... 12,142
Other expenses ...................................... 17,098
------------
1,016,228
Less waiver of fees by Adviser (Note 2) ............. (202,107)
Less expenses paid indirectly (Note 5) .............. (4,398)
------------
809,723
------------
NET INVESTMENT INCOME ............................... 2,335,250
NET REALIZED GAINS ON INVESTMENTS AND FUTURES ....... 30,219,004
NET CHANGE IN UNREALIZED APPRECIATION ON
INVESTMENTS AND FUTURES ......................... 10,365,148
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS. $ 42,919,402
============
</TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
---- ----
OPERATIONS:
<S> <C> <C>
Net investment income .......................................... $ 2,335,250 $ 3,033,100
Net realized gains on investments and futures .................. 30,219,004 25,418,479
Net change in unrealized appreciation on investments and futures 10,365,148 26,788,609
------------- -------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ........... 42,919,402 55,240,188
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income ..................................... (2,645,642) (2,702,229)
From realized gains ............................................ (29,712,590) (28,496,233)
------------- -------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS ...................... (32,358,232) (31,198,462)
------------- -------------
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST - (NOTE 4)
Shares sold .................................................... 12,904,570 19,457,474
Dividends and Distributions reinvested ......................... 31,751,512 30,787,326
Shares redeemed ................................................ (81,272,035) (61,560,976)
------------- -------------
NET DECREASE FROM FUND SHARE TRANSACTIONS ...................... (36,615,953) (11,316,176)
------------- -------------
TOTAL INCREASE/(DECREASE) IN NET ASSETS ........................ (26,054,783) 12,725,550
NET ASSETS BEGINNING OF YEAR ................................... 212,951,051 200,225,501
------------- -------------
NET ASSETS END OF YEAR (INCLUDING UNDISTRIBUTED NET INVESTMENT
income of $463,050 and $773,442) ........................... $ 186,896,268 $ 212,951,051
============= =============
</TABLE>
See notes to financial statements
Page 5
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND ACCOUNTING POLICIES:
RWB/WPG U.S. Large Stock Fund (formerly the U.S. Large Stock Fund) (the "Fund")
is registered under the Investment Company Act of 1940 (the "Act"), as amended,
as a diversified, open-end management company. The following is a summary of
significant accounting policies followed by the Fund in the preparation of its
financial statements. These policies are in conformity with generally accepted
accounting principles.
PORTFOLIO VALUATION: Portfolio securities listed or admitted to trading on a
national securities exchange are valued at the last sale price, on such
exchange, as of the close of regular trading on the New York Stock Exchange on
the day the valuation is made. Unlisted securities and listed securities for
which there are no sales reported on the valuation date are valued at the mean
between the most recent bid and asked prices. Short-term debt securities are
valued at amortized cost, which has been determined by the Fund's Board of
Trustees to represent fair value. If other securities and assets for which
market quotations are not readily available are held by the Fund, they are
valued at their fair value as determined, in good faith, by the Fund's Valuation
Committee as authorized by the Fund's Board of Trustees.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gains and losses from securities
transactions are recorded utilizing the specific identification method. Dividend
income is recognized on the ex-dividend date and interest income is recognized
on the accrual basis.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions are recorded on the ex-dividend
date. Dividends from net investment income are declared and paid at least
annually. Distributions from net realized gains are declared and paid by
December 31 of the year in which they are earned. To the extent that net
realized capital gains can be offset by capital loss carryovers, if any, it is
the policy of the Fund not to distribute such gains.
FEDERAL INCOME TAXES: The Fund's policy is to comply with the requirements of
the Internal Revenue Code that are applicable to regulated investment companies
and to distribute all of its taxable income to its shareholders. No federal
income tax or excise tax provision is required. The federal income tax basis of
investments approximates cost.
FUTURES: A futures contract is an agreement between two parties to buy and sell
a security at a set price on a future date. Upon entering into such a contract,
a Fund is required to pledge to the broker an amount of cash and/or securities
equal to the minimum "initial margin" requirements of the exchange. Pursuant to
the contract, the Fund agrees to receive from, or pay to the broker, an amount
of cash equal to the daily fluctuation in value of the contract. Such a receipt
or payment is known as a "variation margin" and is recorded by the Fund as an
unrealized gain or loss. When the contract is closed, the Fund records a
realized gain or loss equal to the difference between the value of the contract
at the time it was opened and the value at the time it was closed. The Fund is
also required to fully collateralize futures contracts purchased. The Fund only
enters into futures contracts which are traded on exchanges.
FINANCIAL RISKS: The Fund may enter into futures contracts to protect against
adverse movements in the price of securities in the investment portfolio.
Certain risks are associated with the use of futures. The predominant risk is
that the movement in price of the instrument underlying the future may not
correlate perfectly with the movement of the price of the asset being hedged.
USE OF ESTIMATES: Estimates and assumptions are required to be made regarding
assets, liabilities and changes in net assets resulting from operations when
financial statements are prepared. Changes in the economic environment,
financial markets and any other parameters used in determining these estimates
could cause actual results to differ.
NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES: The
investment advisory fee is earned by Weiss, Peck & Greer, L.L.C. ("WPG").
Page 6
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED
Under the Fund's Investment Advisory agreement, the advisory fee is calculated
at the following rates: 0.26% of the Funds average daily net assets not
exceeding $500 million, 0.24% in excess of $500 million up to $1 billion, 0.22%
of assets in excess of $1 billion up to $2 billion and 0.20% in excess of $2
billion. Such fees are paid monthly. WPG has voluntarily agreed to limit the
Fund's total operating expenses to 0.42% or less (determined by average net
assets). In September of 1998, WPG was acquired by Robeco Group N.V., a Dutch
investment management firm. As required by the Investment Company Act of 1940,
the Fund's advisory agreement was renewed through a proxy statement.
Reinhardt Werba Bowen Advisory Services ("RWB") receives an asset allocation fee
up to 2% annually of assets from shareholders (not a Fund expense) participating
in their Strategic Asset Money Management program. RWB receives a fee from the
Fund for shareholder servicing functions provided, equal to 0.10% of daily
average net assets. Certain transactions and service charges may also be imposed
by institutions serving as financial intermediaries in the purchase and custody
of Fund shares held. No part of these fees is received by the Fund or the
Adviser. In August 1998 RWB was acquired by Assante Capital Management Inc. RWB
will continue to carry out shareholder servicing functions.
Certain officers and Trustees of the Fund are "affiliated persons", as defined
in the Act, of WPG.
NOTE 3 - SECURITIES TRANSACTIONS: During the year ended December 31, 1998, sales
proceeds and cost of securities purchased (other than short-term investments and
options written), amounted to $111,745,789 and $46,552,960, respectively.
Brokerage commissions on the above transactions amounted to $147,489. Of this
amount, $52,214 was received by WPG. These amounts do not include profits earned
in connection with the execution of principal transactions, none of which were
received by WPG.
NOTE 4 - TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST: Transactions in the
Fund's Shares of Beneficial Interest were as follows (000's omitted):
YEAR ENDED
DECEMBER 31,
1998 1997
---- ----
Shares sold ....................... 1,580 2,574
Dividends and
distributions reinvested ........ 4,239 4,144
Shares redeemed ................... (9,990) (8,145)
------ ------
Net decrease ...................... (4,171) (1,427)
====== ======
NOTE 5 - The Fund has entered into an expense offset arrangement with its
custodian wherein it receives credit toward the reduction of custodian fees
whenever there are uninvested cash balances. During the year ended December 31,
1998, the Fund's custodian fees amounted to $64,626 of which $4,398 was offset
by such credits. The Fund could have invested its cash balances elsewhere if it
had not agreed to a reduction in fees under the expense offset arrangement with
the custodian.
NOTE 6 - FEDERAL INCOME TAX STATUS OF DIVIDENDS - (Unaudited)
The following tax information represents the designation of various tax benefits
relating to the fiscal year ended December 31, 1998:
The percentage of investment company taxable income eligible for the dividends
received deduction available for certain corporate shareholders with respect to
the fiscal year ended December 31, 1998 is 100%.
Long-term capital gains distributions paid to shareholders by the Fund during
the fiscal year ended December 31, 1998 whether taken in shares or in cash were
$29,712,590.
The above figures may differ from those cited elsewhere in the report due to
differences in the calculations of income and capital gains for Securities and
Exchange Commission (financial reporting) purposes and Internal Revenue Service
(tax) purposes.
Page 7
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
FINANCIAL HIGHLIGHTS (FOR THE YEARS ENDED DECEMBER 31,)
<TABLE>
<CAPTION>
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Per Share Data:
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Year ...... $ 7.43 $ 6.65 $ 6.39 $ 5.05 $ 5.16
-------------- -------------- -------------- -------------- --------------
Net Investment Income .................. 0.14 0.12 0.13 0.13 0.14
Net Realized and Unrealized Gain/(Loss)
on Investments ..................... 1.65 1.93 1.12 1.58 (0.14)
-------------- -------------- -------------- -------------- --------------
Total Income from Operations .............. 1.79 2.05 1.25 1.71 0.00
-------------- -------------- -------------- -------------- --------------
Dividends from Net Investment Income ... (0.13) (0.11) (0.12) (0.13) (0.11)
Distributions from Capital Gains ....... (1.46) (1.16) (0.87) (0.24) 0.00
-------------- -------------- -------------- -------------- --------------
Total Distributions ....................... (1.59) (1.27) (0.99) (0.37) (0.11)
-------------- -------------- -------------- -------------- --------------
Net Asset Value End of Year ............... $ 7.63 $ 7.43 $ 6.65 $ 6.39 $ 5.05
============== ============== ============== ============== ==============
Total Return ................................. 24.51% 30.83% 19.33% 33.81% 0.06%
Net Assets at End of Period (000's) .......... $ 186,896 $ 212,951 $ 200,226 $ 174,161 $ 106,850
Ratios:
Ratio of Expenses to Average Net Assets (a) 0.42% 0.51% 0.59% 0.69% 0.75%
Ratio of Net Investment Income to Average
Net Assets (a) ......................... 1.21% 1.46% 1.86% 2.26% 2.65%
Portfolio Turnover Rate ................... 24.2% 54.2% 59.6% 27.1% 36.2%
<FN>
(a) The Advisor agreed not to impose its full fee from inception through
December 31, 1998. Had the Advisor not so agreed, the ratio of expenses and
net investment income to average net assets would have been 0.79% and 2.61%
for the year ended 12/31/94, 0.74% and 2.21% for the year ended 12/31/95,
0.62% and 1.83% for the year ended 12/31/96, 0.53% and 1.44% for the year
ended 12/31/97, and 0.53% and 1.10% for the year ended 12/31/98,
respectively. The custody fee earnings credit had an effect of less than
0.01% per share on the above ratios.
</FN>
</TABLE>
Page 8
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
AVERAGE ANNUAL TOTAL RETURN
Graph depicted here illustrates the comparison of a $10,000 investment between
the RWB/WPG U.S. Large Stock Fund and the S&P 500 Index for the period June 1993
through December 1998.
U.S.LARGE S&P 500
STOCK INDEX
----- -----
06/08/93 10,000 10,000
12/31/93 10,508 10,592
12/31/94 10,515 10,733
12/31/95 14,070 14,758
12/31/96 16,788 18,189
12/31/97 21,960 24,260
12/31/98 27,343 31,238
INSERT PLOT POINTS
AVERAGE ANNUAL TOTAL RETURN
(for the periods ended December 31, 1998)
ONE FIVE SINCE
YEAR YEAR INCEPTION*
---- ---- ----------
RWB/WPG U.S. Large
Stock Fund ............ 24.51% 21.08% 19.82%
S&P 500 Index ........... 28.76% 24.15% 22.65%
* Inception date 6/8/93.
1998 proved to be a very challenging year for Large Cap managers who focused on
stocks with attractive relative valuations. The uncertainty of the global market
coupled with dramatic cash flows into the equity mutual funds led to the
disproportionate advance of the "safest", most liquid, ultra-large
capitalization stocks. These very large stocks had extremely high valuations,
measured both on historic and relative levels. Given the challenges that value
managers had in 1998, the RWB/WPG US Large Stock Fund had a stellar year. Sound
risk control coupled with strategic rebalancings allowed the Fund to generate a
substantial 24.51% return for the year.
Page 9
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Trustees of
RWB/WPG U.S. Large Stock Fund:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of the RWB/WPG U.S. Large Stock Fund as of December
31, 1998, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the years in the two-year period
then ended, and the financial highlights for each of the years in the five-year
period then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1998, by correspondence with the custodian and the performance of
other appropriate audit procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
RWB/WPG U.S. Large Stock Fund as of December 31, 1998, the results of its
operations for the year then ended, the changes in its net assets for each of
the years in the two-year period then ended, and the financial highlights for
each of the years in the five-year period then ended, in conformity with
generally accepted accounting principles.
New York, New York KPMG LLP
January 19, 1999
Page 10
<PAGE>
RWB/WPG
U.S. LARGE STOCK FUND
REINHARDT WERBA BOWEN
1190 Saratoga Avenue
Suite 200
San Jose, CA 95129
(800) 366-7266 Ext. 124
TRUSTEES
Raymond R. Herrmann, Jr.* William B. Ross*
Lawrence J. Israel* Robert A. Straniere*
Graham E. Jones* Alan B. Werba
Paul Meek*
*Member of Audit Committee
OFFICERS
Roger J. Weiss, PRESIDENT, CHAIRMAN AND TRUSTEE
Jay C. Nadel, EXECUTIVE VICE PRESIDENT AND SECRETARY
Francis H. Powers, EXECUTIVE VICE PRESIDENT AND TREASURER
Daniel Cardell, VICE PRESIDENT
Joseph J. Reardon, VICE PRESIDENT
INVESTMENT ADVISER
Weiss, Peck & Greer, L.L.C.
One New York Plaza
New York, NY 10004
CUSTODIAN
Boston Safe Deposit and Trust Company
One Exchange Place
Boston, MA 02109
DIVIDEND DISBURSING AND TRANSFER AGENT
First Data Investor Services Group
P.O. Box 60448
King of Prussia, PA 19406-0448
LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, MA 02109
INDEPENDENT AUDITORS KPMG LLP
345 Park Avenue
New York, NY 10154
<PAGE>
RWB/WPG U.S. LARGE STOCK FUND
PART C. OTHER INFORMATION
Item 23. EXHIBITS.
** (a) Amended and Restated Agreement and Declaration
of Trust of Registrant.
** (b) Amended and Restated By-Laws of Registrant.
(c) Not applicable.
* (d) (1) Form of Investment Advisory Agreement between
the Registrant and Weiss, Peck & Greer, L.L.C.
+ (e) Principal Underwriting Agreement.
(f) Not applicable.
** (g) (1) Form of Custodian Agreement between the
Registrant and Boston Safe Deposit and Trust
Company.
** (2) Form of Accounting Services Agreement between
the Registrant and Boston Safe Deposit and Trust
Company.
+ (h) Service Agreement between the Registrant and First
Data Investor Services Group, Inc.
** (i) Opinion and consent of Counsel.
+ (j) Independent Auditors' Consent.
(k) Not applicable.
C-1
<PAGE>
(l) Not applicable.
(m) Not applicable.
+ (n) Financial Data Schedule.
(o) Not applicable.
** (p) (1) Letter from Weiss, Peck & Greer to the Registrant
providing that its purchases were made for
investment purposes without any present intention
of redeeming or reselling.
** (2) Powers of Attorney.
- -------------------
* Filed with Post-Effective Amendment No. 8 on June 12, 1998.
** Filed with Post-Effective Amendment No. 7 on May 1, 1998.
+ Filed herewith.
Item 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
Not applicable.
Item 25. INDEMNIFICATION.
Reference is made to Article III Section 7 and Article
VII Section 2 of the Registrant's Declaration of Trust
and Article VI of the Registrant's ByLaws.
Nothing in the By-Laws of the Trust may be construed to
be in derogation of the provisions of Section 17(h) of
the Investment Company Act of 1940 (the "1940 Act")
which provides that the by-laws of a registered
investment company shall not contain any provision which
protects or purports to protect any director or officer
of such company against any liability of the company or
to its security holders to which he would otherwise be
subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties
involved in the conduct of his office ("disabling
conduct").
C-2
<PAGE>
Item 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR.
The business and other connections of the officers and directors of
Weiss, Peck & Greer, L.L.C. are listed on the Form ADV of Weiss, Peck
& Greer, L.L.C. as currently on file with the Commission (File No.
801-6604), the text of which is hereby incorporated by reference.
Item 27. PRINCIPAL UNDERWRITERS.
(a) First Data Distributors, Inc., the principal
underwriter of shares of the Registrant (the "Principal
Underwriter"), acts as principal underwriter to each
investment company in the Weiss, Peck & Greer Group of
Mutual Funds. These mutual funds include: Weiss, Peck &
Greer Funds Trust, which consists of WPG Government
Money Market Fund, WPG Tax Free Money Market Fund, WPG
Core Bond Fund, WPG Intermediate-Term Municipal Bond
Fund and WPG Quantitative Equity Fund; Weiss, Peck &
Greer International Fund; WPG Tudor Fund; WPG Growth and
Income Fund; and Tomorrow Funds Retirement Trust.
(b) Directors and Officers of First Data Distributors, Inc.:
NAME AND PRINCIPAL POSITIONS AND OFFICES POSITIONS AND OFFICES
BUSINESS ADDRESS WITH UNDERWRITER WITH REGISTRANT
Robert Guillocheau Director None
4400 Computer Drive
Westboro, MA
Francis Koudelka Director, President and None
4400 Computer Drive Chief Executive Officer
Westboro, MA
Jack Kutner Director None
4400 Computer Drive
Westboro, MA
Barbara Worthen Director None
4400 Computer Drive
Westboro, MA
Scott Hacker Vice President, None
4400 Computer Drive Treasurer and
Westboro, MA Chief Compliance Officer
Bruno DiStefano Vice President None
4400 Computer Drive
Westboro, MA
Sue Moscaritolo Vice President None
4400 Computer Drive
Westboro, MA
Bernard Rothman Vice President - Tax None
4400 Computer Drive
Westboro, MA
Christine Ritch Chief Legal Officer None
4400 Computer Drive and Clerk
Westboro, MA
Bradley Stearns Assistant Clerk None
4400 Computer Drive
Westboro, MA
(c) The Principal Underwriter does not receive
compensation from the Registrant for serving as the
Registrant's principal underwriter.
Item 28. LOCATION OF ACCOUNTS AND RECORDS.
All account, books and other documents required to be
maintained by Section 31(a) of the 1940 Act, as amended
and the rules thereunder will be maintained (1) at the
offices of the Registrant at One New York Plaza, New
York, New York 10004 (2) at the offices of the
Registrant's Custodian, Boston Safe Deposit and Trust
Company, at One Boston Place, Boston, MA 02109 and (3)
at the offices of the Registrant's Transfer Agent, First
Data Investor Services Group, Inc., P.O. Box 60448, King
of Prussia, PA 19406-0448.
Item 29. MANAGEMENT SERVICES.
Not applicable.
C-3
<PAGE>
Item 30. UNDERTAKINGS.
Not applicable.
C-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
Post-Effective Amendment to the Registrant's Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of New
York, and State of New York on the 26th day of February, 1999.
RWB/WPG U.S. LARGE STOCK FUND
/S/ FRANCIS H. POWERS
Francis H. Powers,
Executive Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registrant's Registration Statement has been
signed below by the following persons in the capacities and on the dates
indicated.
SIGNATURE TITLE DATE
/S/ ROGER J. WEISS Chairman of the Board February 26, 1999
Roger J. Weiss and President (Principal
Executive Officer)
and Trustee
/S/ FRANCIS H. POWERS Executive Vice President February 26, 1999
Francis H. Powers and Treasurer (Principal
Financial and Accounting
Officer)
RAYMOND R. HERRMANN, JR.* Trustee February 26, 1999
- -------------------------
Raymond R. Herrmann, Jr.
C-5
<PAGE>
SIGNATURE TITLE DATE
- --------- ----- ----
LAURENCE J. ISRAEL* Trustee February 26, 1999
Laurence J. Israel
GRAHAM E. JONES* Trustee February 26, 1999
Graham E. Jones
PAUL MEEK* Trustee February 26, 1999
Paul Meek
WILLIAM B. ROSS* Trustee February 26, 1999
William B. Ross
ROBERT A. STRANIERE* Trustee February 26, 1999
Robert A. Straniere
ALAN WERBA* Trustee February 26, 1999
Alan Werba
* By: /S/ FRANCIS H. POWERS February 26, 1999
----------------------
Francis H. Powers
Attorney-in-fact
<PAGE>
EXHIBIT INDEX
-------------
The following exhibit is filed as part of this Registration
Statement.
EXHIBIT DESCRIPTION
(e) Principal Underwriting Agreement.
(h) Service Agreement.
(j) Independent Auditors' Consent.
(n) Financial Data Schedule.
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this 25th day of August, 1998 (the
"Agreement") by and between each of open-end investment companies or series
thereof listed on Schedule A hereto (each, a "Fund") and First Data
Distributors, Inc. (the "Distributor"), a Massachusetts corporation.
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and is currently offering its shares of beneficial interest to the public
pursuant to the Fund's Registration Statement on Form N-1A (the "Registration
Statement"); and
WHEREAS, the Fund desires to retain the Distributor as distributor to
provide for the sale and distribution of the Shares and for such additional
classes or series as the Fund may issue, and the Distributor is prepared to
provide such services commencing on the date first written above.
NOW THEREFORE, in consideration of the premises and mutual covenants
set forth herein and intending to be legally bound hereby the parties hereto
agree as follows:
1. SERVICE AS DISTRIBUTOR
1.1 The Distributor will act as the Fund's Principal Underwriter (as
defined in the 1940 Act) for the distribution of the Shares covered by
the Registration Statement under the Securities Act of 1933, as amended
(the "1933 Act"). The Distributor shall offer Shares at the net asset
value per Share to be calculated as described in the Registration
Statement. To the extent that the Distribution receives payment for
Shares, the Fund shall receive the applicable net asset value on all
sales of Shares by the Distributor. Except as provided in the previous
sentence, the Distributor will have no liability to the Fund for
payment for the purchase of Shares sold pursuant to this Agreement or
with respect to redemptions or repurchases of Shares.
1.2 The Distributor agrees to use efforts deemed appropriate by the
Distributor to solicit orders for the sale of the Shares and will
undertake such advertising and promotion as it believes reasonable in
connection with such solicitation. To the extent that the Distributor
receives fees under any plan adopted by the Fund pursuant to Rule 12b-1
under the 1940 Act, the Distributor agrees to furnish and/or enter into
arrangements with others for the furnishing of marketing or sales
services with respect to the Shares as may be required pursuant to such
plan. To the extent that the Distributor receives shareholder services
fees under any shareholder services plan adopted by the Fund, the
Distributor agrees to furnish and/or enter into arrangements with
others for the furnishing of, personal and/or account maintenance
services with respect to the relevant shareholders of the Fund as may
be required pursuant to such plan. It is contemplated that the
Distributor will, at the Fund's direction, enter into sales or
<PAGE>
servicing agreements with securities dealers, financial institutions
and other industry professionals, such as investment advisers,
accountants and estate planning firms.
1.3 The Fund understands that the Distributor is now, and may in the future
be, the distributor of the shares of several investment companies or
series (collectively, the "Investment Entities"), including Investment
Entities having investment objectives similar to those of the Fund. The
fund further understands that investors and potential investors in the
Fund may invest in shares of such other Investment Entities. The Fund
agrees that the Distributor's duties to such Investment Entities shall
not be deemed in conflict with its duties to the Fund under this
Section 1.3.
1.4 The Distributor shall not utilize any materials in connection with the
sale or offering of Shares except the fund's then-current prospectus
and statement of additional information and such other materials as the
Fund shall provide or approve.
1.5 All activities by the Distributor and its employees, as distributor of
the Shares, shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations
made or adopted by the Securities and Exchange Commission (the "SEC")
or the National Association of Securities Dealers ("NASD"), including
without limitation the NASD Conduct Rules.
1.6 The Distributor will promptly transmit any orders received by it for
purchase or redemption of the Shares to the transfer agent for the
Fund.
1.7 Whenever in its judgment such action is warranted by unusual market,
economic or political conditions or abnormal circumstances of any kind,
the Fund may decline to accept any orders for, or make any sales of,
the Shares until such time as the Fund deems it advisable to accept
such orders and to make such sales, and the Fund advises the
Distributor of such determination.
1.8 The Distributor shall not have any responsibility for any costs and
expenses in connection with the registration of the Shares under the
1933 Act and all expenses in connection with maintaining facilities for
the issue and transfer of Shares and for supplying information, prices
and other data to be furnished by the Fund hereunder, and all expenses
in connection with the preparation and printing of the Fund's
prospectuses and statements of additional information for regulatory
purposes and for distribution to current shareholders.
1.9 The fund agrees at its own expense to execute any and all documents and
to furnish any and all information and otherwise to take all actions
that may be reasonably necessary in connection with the qualification
of the Shares for sale in such states as the Distributor may designate
and as may be agreed to by the Fund. The Fund shall notify the
Distributor in writing of the states in which the Shares may be sold
and shall notify the Distributor in writing of any changes to the
information contained in the previous notification.
1.10 The fund shall furnish from time to time, for use in connection with
the sale of the Shares, such information with respect to the Fund and
the Shares as the Distributor may reasonably request; and the Fund
warrants that the statements contained in any such information shall
fairly show or represent what they purport to show or represent. The
Fund shall also furnish the Distributor upon request with: (a) the
Fund's audited annual statements and unaudited semi-annual statements
of the Fund's books and accounts prepared by the Fund, and (b) from
time to time such additional information regarding the financial
condition of the fund as the Distributor may reasonably request.
1.11 Except as to information included in the Registration Statement in
reliance upon information provided to the Fund by the distributor or
any affiliate of the Distributor that the Distributor or such affiliate
should reasonably expect to be used in the Registration Statement, the
fund represents and warrants to the Distributor that any Registration
Statement filed by the Fund with the SEC, when such Registration
Statement become effective, will contain statements required to be
stated therein to be in material conformity with the 1933 Act and the
rules and regulations of the SEC; that all statements of material fact
contained in any such Registration Statement will be true and correct
when such Registration Statement becomes effective; and that no
Registration Statement when such Registration Statement becomes
effective will include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading to a purchaser of the Shares
in light of the circumstances in which they were made. The Distributor
may but shall not be obligated to propose to the Fund from time to time
such amendment or amendments to any Registration Statement and such
supplement or supplements to any prospectus as, in the light of future
developments, may, in the opinion of the Distributor's counsel, be
necessary or advisable. The Distributor shall promptly notify the Fund
of any advice given to it by its counsel regarding the necessity or
advisability of amending or supplementing such Registration Statement.
If the Fund shall not propose such amendment or amendments and/or
supplement or supplements within fifteen days after receipt by the Fund
of a written request from the Distributor to do so, the Distributor
may, at its option, terminate this Agreement. The fund shall not file
any amendment to any Registration Statement or supplement to any
prospectus without giving the Distributor reasonable notice thereof in
advance; provided, however, that nothing contained in this Agreement
shall in any way limit the Fund's right to file at any time such
amendments to any Registration Statements and/or supplements to any
prospectus, of whatever character, as the Fund may deem advisable, such
right being in all respects absolute and unconditional.
-3-
<PAGE>
1.12 (a) The Fund authorizes the Distributor to use its then-current
prospectus or statement of additional information in the form furnished
from time to time in connection with the sale of the Shares.
(b) The Fund agrees to indemnify and hold harmless the Distributor, its
officers, directors, and employees, and any person who controls the
Distributor within the meaning of Section 15 of the 1933 Act, from and
against any and all claims, costs, expenses (including reasonable
attorneys' fees), losses, damages, charges, payments and liabilities of
any sort of kind ("Losses") which the Distributor, its officers,
directors, employees or any such controlling person may incur under the
1933 Act, under any other statute, at common law or otherwise, arising
out of or based upon: (i) any untrue statement, or alleged untrue
statement, of a material fact contained in the Fund's Registration
Statement, prospectus, statement of additional information, or sales
literature (including amendments and supplements thereto), or (ii) any
omission, or alleged omission, to state a material fact required to be
stated in the Fund's Registration Statement, prospectus, statement of
additional information or sales literature (including amendments or
supplements thereto), necessary to make the statements therein not
misleading; provided, however, that insofar as Losses arise out of or
are based upon any such untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with
information furnished to the Fund by the Distributor or its affiliated
persons for use in the Fund's Registration Statement, prospectus, or
statement of additional information or sales literature (including
amendments or supplements thereto) or arise by reason of the
Distributor's willful misfeasance, bad faith or negligence in the
performance of the Distributor's duties hereunder, such indemnification
is not applicable.
(c) The Fund acknowledges and agrees that in the event that the
Distributor, at the request of the Fund, are required to give
indemnification comparable to that set forth in clause (b) of this
Section 1.12 to any broker-dealer selling Shares of the Fund or
servicing agent servicing the shareholders of the Fund and such
broker-dealer servicing agent shall make a claim for indemnification
against the Distributor, the Distributor shall make a similar claim for
indemnification against the Fund.
1.13 The Distributor agrees to indemnify and hold harmless the Fund, its
officers, trustees and employees each person, if any, who controls the
Fund within the meaning of Section 15 of the 1933 Act against any and
all Loses which the Fund, its officers, trustees and employees or any
such controlling person may incur under the 1933 Act, under any other
statute, at common law or otherwise, but only to the extent that such
Losses incurred by the Fund, its officers, trustees and employees, or
any controlling person (i) arose out of the acquisition of any Shares
by any person which may be based upon any untrue statement, or alleged
untrue statement, of a material fact contained in the Fund's
Registration Statement, prospectus or statement of additional
information (including amendments and supplements thereto), or any
omission, or alleged
-4-
<PAGE>
omission, to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, if such
statement or omission was made in reliance upon information furnished
or confirmed in writing to the Fund by the Distributor or its
affiliated persons (as defined in the 1940 Act) or (ii) arose out of
the Distributor's willful misfeasance, bad faith or negligence in the
performance of its duties hereunder.
1.14 In any case in which one party hereto (the "Indemnifying "Party") may
be asked to indemnify or hold the other party hereto (the "Indemnified
Party") harmless, the Indemnified Party will notify the Indemnifying
party promptly after identifying any situation which it believes
presents or appears likely to present a claim for indemnification (an
"Indemnification Claim") against the Indemnifying Party, although the
failure to do so shall not prevent recovery by the Indemnified Party,
and shall keep the Indemnifying Party advised with respect to all
material developments concerning such situation. The Indemnifying Party
shall have the option to defend the Indemnified Party against any
Indemnification Claim which may be the subject of this indemnification,
and, in the event that the Indemnifying Party so elects, such defense
shall be conducted by counsel chosen by the Indemnifying Party and
reasonably satisfactory to the Indemnified Party, and thereupon the
Indemnifying Party shall take over complete defense of the
Indemnification Claim and the Indemnified Party shall sustain no
further legal or other expenses in respect of such Indemnification
Claim. The Indemnified party will not confess any Indemnification Claim
or make any compromise in any case in which the Indemnifying Party will
be asked to provide indemnification, except with the Indemnifying
party's prior written consent (written shall not unreasonably be
withheld). The obligations of the parties hereto under this Section
1.14 and Section 3.1 shall survive the termination of this Agreement.
1.15 No Shares shall be offered by either the Distributor or the fund under
any of the provisions of this Agreement and no orders for the purchase
of sale of Shares hereunder shall be accepted by the Fund if and so
long as effectiveness of the Registration Statement then in effect or
any necessary amendments thereto shall be suspended under any of the
provisions of the 1933 Act, or if and so long as a current prospectus
as required by Section 5(b)(2) of the 1933 Act is not on file with the
SEC; provided, however, that nothing contained in this Section 1.15
shall in any way restrict or have any application to or bearing upon
the Fund's obligation to redeem Shares tendered for redemption by any
shareholder in accordance with the provisions of the Fund's
Registration Statement, declaration of trust, or bylaws.
1.16 The Fund agrees to advise the Distributor as soon as reasonably
practical by a notice in writing delivered to the Distributor in the
event of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement, prospectus or statement of
additional information then in effect or in the initiation by service
of process on the Fund of any proceeding for that purpose.
-5-
<PAGE>
1.17 The Fund represents and warrants to the Distributor that the Fund is,
or is a series of, an investment company, registered under the 1940 Act
and the Shares sold by the Fund are, and will be registered under the
1933 Act.
2. TERM
----
2.1 This Agreement shall become effective on the date first written above,
and unless sooner terminated as provided herein, shall continue for an
initial two-year term and thereafter shall be renewed for successive
one-year terms, provided such continuance is specifically approved at
least annually by (i) the Fund's Board of Trustees or (ii) by a vote of
a majority of the outstanding voting securities (as defined in the 1940
Act and Rule 18f-2 thereunder) of the Fund, provided that in either
event the continuance is also approved by a majority of the Fund's
Trustees who are not parties to this Agreement and who are not
interested persons (as defined in the 1940 Act) of any party to this
Agreement ("Independent Trustees"), by vote cast in person at a meeting
called for the purpose of voting on such approval. This Agreement is
terminable without penalty, on at least sixty days' written notice, by
the Fund's Board of Trustees, by vote of a majority of the outstanding
voting securities (as defined in the 1940 Act and Rule of 18f-2
thereunder) of the Fund, or by the Distributor. This agreement will
also terminate automatically in the event of its assignment (as defined
in the 1940 Act and the rules thereunder). Finally, this Agreement may
also be terminated by the Fund upon 5 days' written notice to the
Distributor if the NASD has expelled the Distributor or suspended its
membership in that organization.
2.2 In the event a termination notice is given by the Fund, all reasonable
expenses associated with movement of records and materials and
conversion thereof will be borne by the Fund.
<PAGE>
3. LIMITATION OF LIABILITY
-----------------------
3.1 The Distributor shall not be liable to the Fund for any error of
judgment or mistake of law or for any loss suffered by the Fund in
connection with the performance of its obligations and duties under
this Agreement, except a loss resulting from the Distributor's willful
misfeasance, a bad faith or negligence in the performance of such
obligations and duties, or by reason of its reckless disregard thereof.
The Fund will indemnify the Distributor against and hold it harmless
from any and all Losses which may be asserted against the Distributor
for which the Distributor may be held to be liable in connection with
this Agreement or the Distributor's performance hereunder (a "Section
3.1 Claim"), unless such Section 3.1 Claim resulted from a negligent
act or omission to act or bad faith by the Distributor in the
performance of its duties hereunder; provided, however, that as to any
matter disposed of by a compromised payment by the Distributor,
pursuant to a consent decree or otherwise, no indemnification either
for such payments or for any other expenses shall be provided
-6-
<PAGE>
unless there has been a determination that the Distributor did not
engage in willful misfeasance, bad faith or gross negligence or a
reckless disregard of the performance of its obligations and duties (i)
by the court or other body approving the settlement or other
disposition, (ii) based upon a review of readily available facts (as
opposed to a full trial-type inquiry), by written opinion from
independent legal counsel approved by the Fund's Board of Trustees or
(iii) by a majority of the Independent Trustees based upon a review of
readily available facts (as opposed to a full trial-type inquiry). The
provisions of paragraph (a) of Section 1.12 shall apply to any
indemnification provided by the Fund pursuant to this Section 3.1. The
obligations of the parties hereto under this Section 3.1 shall survive
termination of this Agreement.
3.2 Notwithstanding any provision in this Agreement to the contrary, each
party's cumulative liability (to the other party) for all Losses for
any cause whatsoever, except a Loss resulting from the gross negligence
in the performance of its obligations and duties under their Agreement,
and regardless of the form of action or legal theory, shall not exceed
$2,000,000. The parties understand the limitation on damages to be a
reasonable allocation of risk and the parties expressly consent with
respect to such allocation of risk.
3.3 To the extent consistent with the provisions of this Agreement, each
party shall have the duty to mitigate damages for which the other party
may become responsible.
3.4 NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL EITHER PARTY, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS,
TRUSTEES, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE UNDER
THIS AGREEMENT UNDER ANY THEORY OF TORT, CONTRACT, STRICT LIABILITY OF
OTHER LEGAL OR EQUITABLE THEORY FOR LOST PROFITS, EXEMPLARY, PUNITIVE,
SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, EACH OF WHICH
IS HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER
SUCH DAMAGES WERE FORESEEABLE OR WHETHER EITHER PARTY OR ANY ENTITY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
4. EXCLUSION OF WARRANTIES
-----------------------
THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, THE DISTRIBUTOR DISCLAIMS ALL OTHER REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER PERSON,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY,
SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR
OTHERWISE (IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF
TRADE) OF ANY SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO SERVICES
PROVIDED UNDER THIS AGREEMENT.
-7-
<PAGE>
5. MODIFICATIONS AND WAIVERS
-------------------------
No change, termination, modification, or waiver of any term or
condition of the Agreement shall be valid unless in writing signed by
each party. A party's waiver of a breach of any term or condition in
the Agreement shall not be deemed a waiver of any subsequent breach of
the same or another term or condition.
6. PUBLICITY
---------
Neither the Distributor nor the Fund shall release or publish news
releases, public announcements, advertising or other publicity relating
to this Agreement or to the transactions contemplated by it without
prior review and written approval of the other party; provided,
however, that either party may make such disclosures as are required by
legal, accounting or regulatory requirements after making reasonable
efforts in the circumstances to consult in advance with the other
party.
7. SEVERABILITY
-----------
The parties intend every provision of this Agreement to be severable.
If a court of competent jurisdiction determines that any term or
provision is illegal or invalid for any reason, the illegality or
invalidity shall not affect the validity of the remainder of this
Agreement. In such case, the parties shall in good faith modify or
substitute such provision consistent with the original intent of the
parties. Without limiting the generality of this paragraph, if a court
determines that any remedy stated in this Agreement has failed of its
essential purpose, then all other provisions of this Agreement,
including the limitations on liability and exclusion of damages, shall
remain fully effective.
8. FORCE MAJEURE
-------------
No party shall be liable for any default or delay in the performance of
its obligations under this Agreement if and to the extent such default
or delay is caused, directly or indirectly, by (i) fire, flood,
elements of nature or other acts of God; (ii) any outbreak or
escalation of hostilities, war, riots or civil disorders in any
country; or (iii) any act or omission of the other party or any
governmental authority. In any such event, the non-performing party
shall be excused from any further performance and observance of the
obligations so affected only for so long as such circumstances prevail
and such party continues to use commercially reasonable efforts to
recommence performance or observance as soon as practicable.
-8-
<PAGE>
9. MISCELLANEOUS
-------------
9.1 Any notice or other instrument authorized or required by this Agreement
to be given in writing to the Fund or the Distributor shall be
sufficiently given if addressed to the party and received by it at its
office set forth below or at such other place as it may from time to
time designate in writing.
To the Fund:
c/o Weiss Peck & Greer, L.L.C.
One New York Plaza
New York, New York 10004
Attention: Jay S. Nadel, Managing Director
To the Distributor:
First Data Distributors, Inc.
4400 Cmputer Drive
Westboro, Massachusetts 01581
Attention: President
with a copy to the Distributor's Chief Legal Officer
9.2 The laws of the Commonwealth of Massachusetts, excluding the laws on
conflicts of laws, and the applicable provisions of the 1940 Act shall
govern the interpretation, validity, and enforcement of this Agreement.
To the extent the provisions of Massachusetts law or the provisions
hereof conflict with the 1940 Act, the 1940 Act shall control. All
actions arising from or related to this Agreement shall be brought in
the state and federal courts sitting in the City of Boston, and the
Distributor and the Fund hereby submit themselves to the exclusive
jurisdiction of those courts.
9.3 This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
9.4 The captions of this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
9.5 This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and is not intended
to confer upon any other person any rights or remedies hereunder and
shall not affect in any way the rights,
-9-
<PAGE>
obligations and liabilities of either party hereto with the other party
or any of its affiliates under any other agreement.
10. CONFIDENTIALITY
---------------
10.1 The parties agree that the Proprietary Information (defined below) is
confidential information of the parties and their respective licensers.
The Fund and the Distributor shall exercise reasonable care to
safeguard the confidentiality of the Proprietary Information of the
other. The Fund and the Distributor may each use the Proprietary
Information of the other party only to exercise its rights or perform
its duties under this Agreement. The Fund and the Distributor shall not
duplicate, sell or disclose to others the Proprietary Information of
the other, in whole or in part, without the prior written permission of
the other party. The Fund and the Distributor may, however, disclose
Proprietary Information to its employees who have a need to know the
Proprietary Information to perform work for the other, provided that
each shall use reasonable efforts to ensure that the Proprietary
Information is not duplicated or disclosed by its employees in breach
of this Agreement. The Fund and the Distributor may also disclose the
Proprietary Information to independent contractors, auditors and
professional advisors, provided that they use such information in a
manner not inconsistent with this Section 10. Notwithstanding the
previous sentence, in no event shall either the Fund or the Distributor
disclose the Proprietary Information to any competitor of the other
without specific, prior written consent.
10.2 Proprietary Information means:
(a) any data or information that is completely sensitive material, and
not generally known to the public, including, but not limited to,
information about product plans, marketing strategies, finance,
operations, customer relationships, customer profiles (including
without limitation information regarding prior, present or potential
shareholders of the Fund), sales estimates, business plans, and
internal performance results relating to the past, present or future
business activities of the Fund or the Distributor, their respective
subsidiaries and affiliated companies and the customers, clients and
suppliers of any of them;
(b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable and
secret in the sense that its confidentiality affords the Fund or the
Distributor a competitive advantage over its competitors; and
(c) all confidential or proprietary concepts, documentation, reports,
data, specifications, computer software, source code, object code, flow
charts, databases, inventions, know-how, show-how and trade secrets,
whether or not patentable or copyrightable.
-10-
<PAGE>
10.3 Each party acknowledges that breach of the restrictions on use,
dissemination or disclosure of any Proprietary Information would result
in immediate and irreparable harm, and money damages would be
inadequate to compensate the other party for that harm. The parties
shall be entitled to equitable relief, in addition to all other
available remedies, to redress any such breach.
10.4 The obligations of confidentiality and restriction on use herein shall
not apply to any Proprietary Information that a party proves:
(a) Was in the public domain prior to the date of this Agreement or
subsequently came into the public domain through no fault of such
party; or
(b) Was lawfully received by the party from a third party free of any
obligation of confidence to such third party; or
(c) Was already in the possession of the party prior to receipt
thereof, directly or indirectly, from the other party; or
(d) Is required to be disclosed in a judicial or administrative
proceeding after all reasonable legal remedies for maintaining such
information in confidence have been exhausted including, but not
limited to, giving the other party as much advance notice of the
possibility of such disclosure as practical so the other party may
attempt to stop such disclosure or obtain a protective order concerning
such disclosure; or
(e) Is subsequently and independently developed by employees,
consultants or agents of the party without reference to the Proprietary
Information disclosed under this Agreement.
10.5 The Distributor shall keep and maintain on behalf of the Fund all books
and records which the Fund and the Distributor are, or may be, required
to keep and maintain in connection with the services to be provided
hereunder pursuant to any applicable statutes, rules and regulations,
including without limitation Rules 31a-1 and 31a-2 under the Act. The
Distributor further agrees that all such books and records shall be the
property of the Fund and to make such books and records available for
inspection by or upon the request of the Fund or, upon prior notice by
the Distributor to the Fund, by the SEC at reasonable times.
10.6 The provisions of this Section 10 shall survive the termination of this
Agreement.
11. ENTIRE AGREEMENT
----------------
This Agreement, including all Schedules hereto, constitutes the entire
agreement between the parties with respect to the subject matter hereof
and supersedes all prior and contemporaneous proposals, agreements,
contracts, representations, and understandings, whether written or
-11-
<PAGE>
oral, between the parties with respect to the subject matter hereof. It
is recognized that the Fund is an intended third party beneficiary of
the Consulting Agreement, dated of even date herewith, between the
Distributor and Weiss, Peck & Greer, L.L.C.
12. TRUSTEE LIABILITY
-----------------
The Fund and the Distributor agree that the obligations of the Fund
under the Agreement shall not be binding upon any of the Fund's
Trustees, shareholders, nominees, officers, employees or agents,
whether past, present or future, of the Fund individually, but are
binding only upon the assets and property of the Fund, as provided in
the Fund's declaration of trust. The execution and delivery of this
Agreement have been authorized by the Fund's Trustees, and signed by an
authorized officer of the Fund, acting as such, and neither such
authorization by such trustees nor such execution and delivery by such
officer shall be deemed to have been made by any of them or any
shareholder of the Fund individually or to impose any liability on any
of them or any shareholder of the Fund personally, but shall bind only
the assets and property of the Fund as provided in the Fund's
declaration of trust. No series of a Fund that is a multi-series
investment company shall be liable for the obligations of any other
series of such Fund.
It is agreed that for purposes of this Agreement, that each of the
entities listed below, individually and not jointly, shall be deemed to
be a Fund. It is also understood that each of such entities shall be
deemed to be entered into a separate agreement with the Distributor so
that it is as if each of such entities had signed a separate agreement
and that a single document is being signed simply to facilitate the
execution and administration of this Agreement. None of such entities
is responsible for any of the obligations of, or liabilities of, or is
entitled to any of the rights of, any other entity. The entities
referred to above in this paragraph are as follows: WPG Government
Money Market Fund, WPG Tax Free Money Market Fund, WPG Intermediate
Municipal Bond Fund, WPG Core Bond Fund and WPG Quantitative Equity
Fund, Weiss, Peck & Greer International Fund, WPG Growth Fund, WPG
Growth and Income Fund, WPG Tudor Fund, RWB/WPG U.S. Large Stock Fund,
and Tomorrow Funds Retirement Trust, composed of the following series
investment companies: Tomorrow Short-Term Retirement Fund, Tomorrow
Medium-Term Retirement Fund, Tomorrow Long-Term Retirement Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
-12-
<PAGE>
EACH OF THE FUNDS SET FORTH ON THE
SCHEDULE A HERETO
By: /s/ Jay C. Nadel
Name: Managing Director
Title: Jay C. Nadel
FIRST DATA DISTRIBUTORS, INC.
By: /s/ Scott M. Hacker
Name: Scott M. Hacker
Title: V.P. and Treasurer
-13-
<PAGE>
SCHEDULE A
NAME OF FUNDS
Weiss, Peck & Greer Funds Trust
WPG Government Money Market Fund
WPG Tax Free Money Market Fund
WPG Intermediate Municipal Bond Fund
WPG Core Bond Fund
WPG Quantitative Equity Fund
Weiss, Peck & Greer International Fund
WPG Growth Fund
WPG Growth and Income Fund
WPG Tudor Fund
RWB/WPG U.S. Large Stock Fund
Tomorrow Funds Retirement Trust
Tomorrow Short-Term Retirement Fund
Tomorrow Medium-Term Retirement Fund
Tomorrow Long-Term Retirement Fund
-14-
SERVICES AGREEMENT
THIS AGREEMENT, dated as of this day of November 13, 1998 between
RWB/WPG U.S. LARGE STOCK FUND (the "Fund") "), organized under the laws of
Delaware and having its principal place of business at One New York Plaza, New
York, New York and First Data Investor Services Group, Inc. (the "Investor
Services Group"), a Massachusetts corporation with principal offices at 4400
Computer Drive Westborough, Massachusetts 01581.
WITNESSETH
----------
WHEREAS, the Fund desires to appoint Investor Services Group as its
fund accounting agent, transfer agent, dividend disbursing agent and agent in
connection with certain other activities and Investor Services Group desires to
accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, the Fund and Investor Services Group agree as follows:
Article 1 DEFINITIONS
1.1 Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Declaration of Trust, or other similar organizational
document as the case may be, of the Fund as the same may be amended
from time to time.
(b) "Authorized Person" shall be deemed to include (i) any
authorized officer of the Fund; or (ii) any person, whether or not such
person is an officer or employee of the Fund, duly authorized to give
Oral Instructions or Written Instructions on behalf of the Fund as
indicated in writing to Investor Services Group from time to time.
(c) "Board of Directors" shall mean the Board of Directors or
Board of Trustees of the Fund, as the case may be.
(d) "Commission" shall mean the Securities and Exchange
Commission.
(e) "Custodian" refers to any custodian or subcustodian of
securities and other property which the Fund may from time to time
deposit, or cause to be deposited or held under the name or account of
such a custodian pursuant to a Custodian Agreement.
(f) "1934 Act" shall mean the Securities Exchange Act of 1934
and the rules and regulations promulgated thereunder, all as amended
from time to time.
(g) "1940 Act" shall mean the Investment Company Act of 1940
and the rules and regulations promulgated thereunder, all as amended
from time to time.
<PAGE>
(h) "Oral Instructions" shall mean instructions, other than
Written Instructions, actually received by Investor Services Group from
a person reasonably believed by Investor Services Group to be an
Authorized Person;
(i) "Prospectus" shall mean the most recently dated Fund
Prospectus and Statement of Additional Information, including any
supplements thereto if any, which has become effective under the
Securities Act of 1933 and the 1940 Act.
(j) "Shares" refers collectively to such shares of capital
stock or beneficial interest, as the case may be, or class thereof, of
the Fund as may be issued from time to time.
(k) "Shareholder" shall mean a record owner of Shares of the
Fund.
(l) "Written Instructions" shall mean a written communication
signed by a person reasonably believed by Investor Services Group to be
an Authorized Person and actually received by Investor Services Group.
Written Instructions shall include manually executed originals and
authorized electronic transmissions, including telefacsimile of a
manually executed original or other process.
Article 2 APPOINTMENT OF INVESTOR SERVICES GROUP
2.1 The Fund hereby appoints and constitutes Investor Services Group as
fund accounting agent, transfer agent and dividend disbursing agent for Shares
of the Fund and as shareholder servicing agent for the Fund and Investor
Services Group hereby accepts such appointments and agrees to perform the duties
hereinafter set forth.
Article 3 DUTIES OF INVESTOR SERVICES GROUP
3.1 As transfer agent Investor Services Group shall be responsible for:
(a) Administering and/or performing the customary services of
a transfer agent; acting as service agent in connection with dividend
and distribution functions; and for performing shareholder account and
administrative agent functions in connection with the issuance,
transfer and redemption or repurchase (including coordination with the
Custodian) of Shares of the Fund, as more fully described in the
written schedule of Duties of Investor Services Group annexed hereto as
Schedule A and incorporated herein, and in accordance with the terms of
the Prospectus of the Fund, applicable law and the procedures
established from time to time between Investor Services Group and the
Fund.
(b) Recording the issuance of Shares and maintaining pursuant
to Rule 17Ad-10(e) of the 1934 Act a record of the total number of
Shares of the Fund which are authorized, based upon data provided to it
by the Fund, and issued and outstanding. Investor Services Group shall
provide the Fund on a regular basis with the total number of Shares of
-2-
<PAGE>
the Fund which are authorized and issued and outstanding and shall have
no obligation, when recording the issuance of Shares, to monitor the
issuance of such Shares or to take cognizance of any laws relating to
the issue or sale of such Shares, which functions shall be the sole
responsibility of the Fund.
(c) Notwithstanding any of the foregoing provisions of this
Agreement, Investor Services Group shall be under no duty or obligation
to inquire into, and shall not be liable for: (i) the legality of the
issuance or sale of any Shares or the sufficiency of the amount to be
received therefor; (ii) the legality of the redemption of any Shares,
or the propriety of the amount to be paid therefor; (iii) the legality
of the declaration of any dividend by the Board of Directors, or the
legality of the issuance of any Shares in payment of any dividend; or
(iv) the legality of any recapitalization or readjustment of the
Shares.
3.2 As fund accounting agent, shall be responsible for performing the
customary services of a fund accounting agent, including those services as more
fully described in the written schedule of Duties of Investor Services Group
annexed hereto as Schedule A and incorporated herein, and subject to the
supervision and direction of the Board of Directors of the Fund.
3.3 As the Fund's print/mail services provider, Investor Services Group
agrees to perform print/mail services with respect to those items listed in
Schedule B for the fees also identified in Schedule B.
3.4 The Fund's Blue Sky Filing Agent shall (i) identify to Investor
Services Group in writing those transactions and assets to be treated as exempt
from blue sky reporting for each State and (ii) verify the establishment of
transactions for each State on the system prior to activation and thereafter
monitor the daily activity for each State. The responsibility of Investor
Services Group for the Fund's blue sky State registration status is solely
limited to the initial establishment of transactions subject to blue sky
compliance by the Fund and the reporting of such transactions to the Fund as
provided above. For so long as Investor Services Group serves as the Fund's blue
sky registration agent this provision shall be inoperative.
3.5 Investor Services Group agrees to undertake certain development
efforts as more fully described in the written schedule of Related Services
annexed hereto as Schedule E and incorporated herein. The parties hereto
acknowledge that Investor Services Group shall be providing the foregoing with
respect to all of the Weiss Peck & Greer affiliated mutual funds for which
Investor Services Group provides transfer agent services and accounting and/or
administration services.
3.6 In addition to the duties set forth herein, Investor Services Group
shall perform such other duties and functions, and shall be paid such amounts
therefor, as may from time to time be agreed upon in writing between the Fund
and Investor Services Group.
Article 4 RECORDKEEPING AND OTHER INFORMATION
4.1 Investor Services Group shall create and maintain all records
required of it pursuant to its duties hereunder and as set forth in Schedule A
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in accordance with all applicable laws, rules and regulations, including without
limitation, records required by Section 31(a) of the 1940 Act and by applicable
tax laws and regulations. All records shall be available during regular business
hours for inspection and use by the Fund. Where applicable, such records shall
be maintained by Investor Services Group for the periods and in the places
required by Rule 31a-2 under the 1940 Act.
4.2 To the extent required by Section 31 of the 1940 Act and
notwithstanding Articles 8 and 15 of this Agreement, Investor Services Group
agrees that all such records prepared or maintained by Investor Services Group
relating to the services to be performed by Investor Services Group hereunder
are the property of the Fund and will be preserved, maintained and made
available in accordance with such section, and will be surrendered promptly to
the Fund on and in accordance with the Fund's request.
4.3 In case of any requests or demands for the inspection of
Shareholder records of the Fund, Investor Services Group will endeavor to notify
the Fund of such request and secure Written Instructions as to the handling of
such request. Investor Services Group reserves the right, however, to exhibit
the Shareholder records to any person whenever it is advised by its counsel that
it may be held liable for the failure to comply with such request.
Article 5 FUND INSTRUCTIONS
5.1 Investor Services Group will have no liability when acting upon
Written or Oral Instructions believed to have been executed or orally
communicated by an Authorized Person and will not be held to have any notice of
any change of authority of any person until receipt of a Written Instruction
thereof from the Fund. Investor Services Group will also have no liability when
processing Share certificates which it reasonably believes to bear the proper
manual or facsimile signatures of the officers of the Fund and the proper
countersignature of Investor Services Group.
5.2 At any time, Investor Services Group may request Written
Instructions from the Fund and may seek advice from legal counsel for the Fund,
or its own legal counsel, with respect to any matter arising in connection with
this Agreement, and it shall not be liable for any action taken or not taken or
suffered by it in good faith in accordance with such Written Instructions or in
accordance with the opinion of counsel for the Fund or for Investor Services
Group. Written Instructions requested by Investor Services Group will be
provided by the Fund within a reasonable period of time.
5.3 Investor Services Group, its officers, agents or employees, shall
accept Oral Instructions or Written Instructions given to them by any person
representing or acting on behalf of the Fund only if said representative is an
Authorized Person. The Fund agrees that all Oral Instructions shall be followed
within one business day by confirming Written Instructions, and that the Fund's
failure to so confirm shall not impair in any respect Investor Services Group's
right to rely on Oral Instructions.
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Article 6 COMPENSATION
6.1 The Fund will compensate Investor Services Group for the
performance of its obligations hereunder in accordance with the fees set forth
in the written Fee Schedule annexed hereto as Schedule B and incorporated
herein.
6.2 In addition to those fees set forth in Section 6.1 above, the Fund
agrees to pay, and will be billed separately for, reasonable out-of-pocket
expenses incurred by Investor Services Group in the performance of its duties
hereunder. Out-of-pocket expenses shall include, but shall not be limited to,
the items specified in the written schedule of out-of-pocket charges annexed
hereto as Schedule C and incorporated herein. Schedule C may be modified by
written agreement between the parties. Unspecified out-of-pocket expenses shall
be limited to those out-of-pocket expenses reasonably incurred by Investor
Services Group in the performance of its obligations hereunder.
6.3 The Fund agrees to pay all fees and out-of-pocket expenses within
fifteen (15) days following the receipt of the respective invoice.
6.4 Any compensation agreed to hereunder may be adjusted from time to
time by attaching to Schedule B, a revised Fee Schedule executed and dated by
the parties hereto.
Article 7 DOCUMENTS
7.1 In connection with the appointment of Investor Services Group, the
Fund shall, on or before the date this Agreement goes into effect, but in any
case within a reasonable period of time for Investor Services Group to prepare
to perform its duties hereunder, deliver or caused to be delivered to Investor
Services Group the documents set forth in the written schedule of Fund Documents
annexed hereto as Schedule D. Investor Services Group acknowledges receipt of
such documents.
Article 8 INVESTOR SERVICES GROUP SYSTEM
8.1 Investor Services Group shall retain title to and ownership of any
and all data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions, discoveries,
patentable or copyrightable matters, concepts, expertise, patents, copyrights,
trade secrets, and other related legal rights utilized by Investor Services
Group in connection with the services provided by Investor Services Group to the
Fund herein (the "Investor Services Group System").
8.2 Investor Services Group hereby grants to the Fund a limited license
to Investor Services Group System for the sole and limited purpose of having
Investor Services Group provide the services contemplated hereunder and nothing
contained in this Agreement shall be construed or interpreted otherwise and such
license shall immediately terminate with the termination of this Agreement.
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Article 9 REPRESENTATIONS AND WARRANTIES OF INVESTOR SERVICES GROUP
9.1 Investor Services Group represents and warrants to the Fund that:
(a) It is a corporation duly organized an existing and in good
standing under the laws of the Commonwealth of Massachusetts;
(b) It is empowered under applicable laws and by its Articles
of Incorporation and By-Laws to enter into and perform this Agreement;
(c) All requisite corporate proceedings have been taken to
authorized it to enter into this Agreement;
(d) It is duly registered with its appropriate regulatory
agency as a transfer agent and such registration will remain in effect
for the duration of this Agreement;
(e) It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
9.2 Year 2000 Compliance. (a) For purposes of this Agreement, "Year
2000 Compliant" means:
(i) date data will process without error or interruption due
solely to the change in century, in any level of computer hardware or
software Investor Services Group provides/uses in performing its
services hereunder, including, but not limited to, microcode, firmware,
system and application programs, files and databases; and
(ii) there will be no loss of any functionality of the
Investor Services Group System due solely to the change in century,
with respect to the introduction, processing or output of date records.
(b) Investor Services Group represents and warrants that:
(i) The Investor Services Group System will be Year 2000
Compliant by December 31, 1998; provided, however, that Investor
Services Group will be in a process of testing the Investor Services
Group System in regard to Year 2000 Compliance throughout calendar year
1999 and any temporary and immaterial loss of functionality occurring
during the ordinary course of this testing and fixing process shall not
be considered a failure of Investor Services Group to be Year 2000
Compliant.
(ii) The Investor Services Group System will continue to be
interoperable, in the same manner as it is prior to January 1, 2000,
with software and hardware which may deliver records to, receive
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records from or interact with the Investor Services Group System in the
course of processing data, provided that such other software and
hardware is Year 2000 Compliant as defined herein and complies with the
interface and format standards specified by Investor Services Group.
(c) The Fund agrees to cooperate fully with Investor Services
Group to ensure the interoperability of the Investor Services Group
System with hardware and software used by Fund. Investor Services Group
shall have the right, at its discretion, to reject any data file which
it in good faith believes will interfere with the ability of the
Investor Services Group System to be Year 2000 Compliant.
Article 10 REPRESENTATIONS AND WARRANTIES OF THE FUND
10.1 The Fund represents and warrants to Investor Services Group that:
(a) It is duly organized and existing and in good standing
under the laws of the jurisdiction in which it is organized;
(b) It is empowered under applicable laws and by its Article
of Incorporation and By-Laws to enter into this Agreement;
(c) All corporate proceedings required by said Articles of
Incorporation, By-Laws and applicable laws have been taken to
authorized it to enter into this Agreement;
(d) A registration statement under the Securities Act of 1933,
as amended, and the 1940 Act on behalf of the Fund is currently
effective and will remain effective with respect to all Shares of the
Fund being offered for sale;
(e) Except to the extent that Investor Services Group serves
as the Fund's Blue Sky Filing Agent, all appropriate state securities
law filings have been made and will continue to be made, with respect
to all Shares of the Fund being offered for sale; and
(f) All outstanding Shares are validly issued, fully paid and
non-assessable. When Shares are hereafter issued in accordance with the
terms of the Fund's Articles of Incorporation and its Prospectus with
respect to the Fund, such Shares shall be validly issued, fully paid
and non-assessable.
Article 11 INDEMNIFICATION
11.1 Investor Services Group shall not be responsible for and the Fund
shall indemnify and hold Investor Services Group harmless from and against any
and all claims, costs, expenses (including reasonable attorneys' fees), losses,
damages, charges, payments and liabilities of any sort or kind which may be
asserted against Investor Services Group or for which Investor Services Group
may be held to be liable (a "Claim") arising out of or attributable to any of
the following:
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(a) Any actions of Investor Services Group required to be
taken pursuant to this Agreement unless such Claim resulted from a
negligent act or omission to act or bad faith by Investor Services
Group in the performance of its duties hereunder;
(b) Investor Services Group's reasonable reliance on, or
reasonable use of information, data, records and documents (including
but not limited to magnetic tapes, computer printouts, hard copies and
microfilm copies) received by Investor Services Group from the Fund, or
any authorized third party acting on behalf of the Fund, including but
not limited to the prior transfer agent for the Fund, in the
performance of Investor Services Group's duties and obligations
hereunder;
(c) The reliance on, or the implementation of, any Written or
Oral Instructions or any other instructions or requests of the Fund
reasonably believed by Investor Services Group to be genuine and to be
signed, countersigned or executed or orally communicated by an
Authorized Person;
(d) The offer or sale of shares in violation of any
requirement under the federal securities laws or regulations or in
violation of any stop order or other determination or ruling by federal
regulators with respect to the offer or sale of such shares, unless
Investor Services Group is properly notified and has a reasonable
amount of time to act on such notification;
(e) Except to the extent that Investor Services Group serves
as the Fund's Blue Sky Filing Agent, the offer or sales of shares in
violation of any requirement under the securities laws or regulations
of any state that such shares be registered in such state or in
violation of any stop order or other determination or ruling by any
state with respect to the offer or sale of such shares in such state;
and
(f) The Fund's refusal or failure to comply with the terms of
this Agreement, or any Claim which arises out of the Fund's negligence
or misconduct or the breach of any representation or warranty of the
Fund made herein.
11.2 In any case in which the Fund may be asked to indemnify or hold
Investor Services Group harmless, Investor Services Group will notify the Fund
promptly after identifying any situation which it believes presents or appears
likely to present a claim for indemnification against the Fund although the
failure to do so shall not prevent recovery by Investor Services Group and shall
keep the Fund advised with respect to all developments concerning such
situation. The Fund shall have the option to defend Investor Services Group
against any Claim which may be the subject of this indemnification, and, in the
event that the Fund so elects, such defense shall be conducted by counsel chosen
by the Fund and reasonably satisfactory to Investor Services Group, and
thereupon the Fund shall take over complete defense of the Claim and Investor
Services Group shall sustain no further legal or other expenses in respect of
such Claim. Investor Services Group will not confess any Claim or make any
compromise in any case in which the Fund will be asked to provide
indemnification, except with the Fund's prior written consent. The obligations
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of the parties hereto under this Article 11 shall survive the termination of
this Agreement.
Article 12 STANDARD OF CARE
12.1 Investor Services Group shall at all times act in good faith and
agrees to use its best efforts within commercially reasonable limits to ensure
the accuracy of all services performed under this Agreement, but assumes no
responsibility for loss or damage to the Fund unless said errors are caused by
Investor Services Group's own negligence, bad faith or willful misconduct or
that of its employees.
12.2 Notwithstanding the foregoing Section 12.1 or anything else
contained in this Agreement to the contrary, Investor Services Group's entire
liability to the Fund, to the extent not covered by Investor Services Group's
liability insurance and fidelity bond coverage and without giving effect to any
deductible, for any loss or damage, direct or indirect for any cause whatsoever
(including but not limited to those arising out of this Agreement), and
regardless of the form of action, shall be limited to the Fund's actual direct
out-of-pocket expenses which are reasonably incurred by the Fund, but shall not
under any circumstances exceed two-million dollars ($2,000,000) over any three
(3) year rolling period.
Article 13 CONSEQUENTIAL DAMAGES
13.1 In no event and under no circumstances shall either party to this
Agreement be liable to the other party for consequential or indirect loss of
profits, reputation or business or any other special damages under any provision
of this Agreement or for any act or failure to act hereunder.
Article 14 TERM AND TERMINATION
14.1 This Agreement shall be effective on the date first written above
and shall continue through November 13, 2003 (the "Initial Term"), unless
earlier terminated pursuant to the terms of this Agreement. Thereafter, this
Agreement shall automatically be renewed for successive terms of three (3) years
("Renewal Terms") each.
14.2 Either party may terminate this Agreement at the end of the
Initial Term or any subsequent Renewal Term upon not less than thirty (30) days
or more than one-hundred eighty (180) days prior written notice to the other
party.
14.3 In the event a termination notice is given by the Fund, all
expenses associated with movement of records and materials and conversion
thereof to a successor transfer agent will be borne by the Fund. Upon such
termination and payment by the Fund of all outstanding, undisputed fees owed to
Investor Services Group, Investor Services Group will deliver to such successor
transfer agent a certified list of shareholders of the Fund (with names and
addresses), and all other relevant books, records, correspondence and other Fund
records or data in the possession of Investor Services Group, and Investor
Services Group will cooperate with the Fund and any successor transfer agent in
the substitution process.
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14.4 If a party hereto is guilty of a material failure to perform its
duties and obligations hereunder (a "Defaulting Party") the other party (the
"Non-Defaulting Party") may give written notice thereof to the Defaulting Party,
and if such material breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting Party may terminate
this Agreement by giving thirty (30) days written notice of such termination to
the Defaulting Party. If Investor Services Group is the Non-Defaulting Party,
its termination of this Agreement shall not constitute a waiver of any other
rights or remedies of Investor Services Group with respect to services performed
prior to such termination or rights of Investor Services Group to be reimbursed
for out-of-pocket expenses. In all cases, termination by the Non-Defaulting
Party shall not constitute a waiver by the Non-Defaulting Party of any other
rights it might have under this Agreement or otherwise against the Defaulting
Party. In addition to the foregoing, if the Board of Trustees of the Fund
instructs the Fund to terminate this Agreement in connection with and after a
material failure by Investor Services Group to perform its duties and
obligations hereunder, the Fund may terminate this Agreement by giving thirty
(30) days written notice of such termination to Investor Services Group
irrespective of whether the material breach has been remedied.
Article 15 CONFIDENTIALITY
15.1 In connection with the services provided by Investor Services
Group hereunder, certain confidential and proprietary information regarding
Investor Services Group and the Fund may be disclosed to the other. In
connection therewith, the parties agree as follows:
(a) Confidential Information disclosed under this Agreement
shall mean:
(i) any data or information that is competitively sensitive
material, and not generally known to the public, including,
but not limited to, information about product plans, marketing
strategies, finance, operations, customer relationships,
customer profiles, sales estimates, business plans, and
internal performance results relating to the past, present or
future business activities of Investor Services Group or the
Fund, their respective parent corporation, their respective
subsidiaries and affiliated companies and the customers,
clients and suppliers of any of the foregoing;
(ii) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality
affords Investor Services Group or the Fund a competitive
advantage over its competitors; and
(iii) all confidential or proprietary concepts, documentation,
reports, data, specifications, computer software, source code,
object code, flow charts, databases, inventions, know-how,
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show-how and trade secrets, whether or not patentable or
copyrightable.
(b) Confidential Information includes, without limitation, all
documents, inventions, substances, engineering and laboratory
notebooks, drawings, diagrams, specifications, bills of material,
equipment, prototypes and models, and any other tangible manifestation
of the foregoing which now exist or come into the control or possession
of the party.
15.2 Except as expressly authorized by prior written consent of the
disclosing party ("Discloser"), the party receiving Confidential Information
("Recipient") shall:
(a) limit access to Discloser's Confidential Information to
Recipient's employees who have a need-to-know in connection with the
subject matter thereof;
(b) advise those employees who have access to the Confidential
Information of the proprietary nature thereof and of the obligations
set forth in this Confidentiality Agreement;
(c) take appropriate action by instruction or agreement with
the employees having access to Discloser's Confidential Information to
fulfill Recipient's obligations under this Confidentiality Agreement;
(d) safeguard all of Discloser's Confidential Information by
using a reasonable degree of care, but not less than that degree of
care used by Recipient in safeguarding its own similar information or
material;
(e) use all of Discloser's Confidential Information solely for
purposes that it was intended;
(f) not disclose any of Discloser's Confidential Information
to third parties; and
(g) not disclose the existence of the discussions to any third
party.
15.3 Upon Discloser's request, Recipient shall surrender to Discloser
all memoranda, notes, records, drawings, manuals, records, and other documents
or materials (and all copies of same) relating to or containing Discloser's
Confidential Information. When Recipient returns the materials, Recipient shall
certify in writing that it has returned all materials containing or relating to
the Confidential Information.
15.4 The obligations of confidentiality and restriction on use in this
Article 15 shall not apply to any Confidential Information that Recipient
proves:
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(a) was in the public domain prior to the date of this
Agreement or subsequently came into the public domain through no fault
of Recipient; or
(b) was lawfully received by Recipient from a third party free
of any obligation of confidence to the third party; or
(c) was already in Recipient's possession prior to receipt
from Discloser; or
(d) is required to be disclosed in a judicial or
administrative proceeding after all reasonable legal remedies for
maintaining such information in confidence have been exhausted
including, but not limited to, giving Discloser as much advance notice
as practical of the possibility of disclosure to allow Discloser to
stop such disclosure or obtain a protective order concerning such
disclosure; or
(e) is subsequently and independently developed by Recipient's
employees, consultants or agents without reference to Confidential
Information.
15.5 The Fund and Investor Services Group agree that money damages
would not be a sufficient remedy for breach of this Article 15. Accordingly, in
addition to all other remedies that either party may have, a party shall be
entitled to specific performance and injunctive or other equitable relief as a
remedy for any breach of this Agreement. The parties agree to waive any
requirement for a bond in connection with any such injunctive or other equitable
relief.
Article 16 FORCE MAJEURE
16.1 In the event either party is unable to perform its obligations
under the terms of this Agreement because of acts of God, or by circumstances
beyond its reasonable control, including strikes, labor difficulties, mechanical
breakdowns, equipment or transmission failure or damage, such party shall not be
liable for damages to the other for any damages resulting from such failure to
perform or otherwise from such causes.
Article 17 AMENDMENTS
17.1 This Agreement may only be amended or modified by a written
instrument executed by both parties.
Article 18 SUBCONTRACTING
18.1 The Fund agrees that Investor Services Group may, in its
discretion, subcontract for certain of the services described under this
Agreement or the Schedules hereto; provided that the appointment of any such
Investor Services Group shall not relieve Investor Services Group of its
responsibilities hereunder.
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Article 19 ARBITRATION
19.1 Any claim or controversy arising out of or relating to this
Agreement, or breach hereof, shall be settled by arbitration administered by the
American Arbitration Association in Boston, Massachusetts in accordance with its
applicable rules, except that the Federal Rules of Evidence and the Federal
Rules of Civil Procedure with respect to the discovery process shall apply.
19.2 The parties hereby agree that judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction.
19.3 The parties acknowledge and agree that the performance of the
obligations under this Agreement necessitates the use of instrumentalities of
interstate commerce and, notwithstanding other general choice of law provisions
in this Agreement, the parties agree that the Federal Arbitration Act shall
govern and control with respect to the provisions of this Article 19.
Article 20 NOTICE
20.1 Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Fund or Investor Services Group, shall
be sufficiently given if addressed to that party and received by it at its
office set forth below or at such other place as it may from time to time
designate in writing.
To the Fund:
RWB/WPG U.S. Large Stock Fund
One New York Plaza
New York, New York 10004
Attention: Jay C. Nadel
To Investor Services Group:
First Data Investor Services Group, Inc.
4400 Computer Drive
Westborough, MA 01581
Attention: President
with a copy to Investor Services Group's General Counsel
Article 21 SUCCESSORS
21.1 This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns, provided, however,
that this Agreement shall not be assigned to any person other than a person
controlling, controlled by or under common control with the assignor without the
written consent of the other party, which consent shall not be unreasonably
withheld.
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Article 22 GOVERNING LAW
22.1 This Agreement shall be governed exclusively by the laws of the
Commonwealth of Massachusetts without reference to the choice of law provisions
thereof. Each party hereto hereby (i) consents to the personal jurisdiction of
the Commonwealth of Massachusetts courts over the parties hereto, hereby waiving
any defense of lack of personal jurisdiction; and (ii) appoints the person to
whom notices hereunder are to be sent as agent for service of process.
Article 23 COUNTERPARTS
23.1 This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original; but such counterparts shall,
together, constitute only one instrument.
Article 24 CAPTIONS
24.1 The captions of this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
Article 25 USE OF INVESTOR SERVICES GROUP/FUND NAME
25.1 The Fund shall not use the name of Investor Services Group in any
Prospectus, Statement of Additional Information, Shareholders' report, sales
literature or other material relating to the Fund in a manner not approved prior
thereto; provided, that Investor Services Group need not receive notice of all
reasonable uses of its name which merely refer in accurate terms to its
appointment hereunder or which are required by any government agency or
applicable law or rule.
25.2 Investor Services Group shall not use the name of the Fund or
material relating to the Fund on any documents or forms for other than internal
use in a manner not approved prior thereto; provided, that the Fund need not
receive notice of all reasonable uses of its name which merely refer in accurate
terms to the appointment of Investor Services Group or which are required by any
government agency or applicable law or rule.
Article 26 RELATIONSHIP OF PARTIES
26.1 The parties agree that they are independent contractors and not
partners or co-venturers and nothing contained herein shall be interpreted or
construed otherwise.
Article 27 ENTIRE AGREEMENT; SEVERABILITY
27.1 This Agreement and the Exhibits and Schedules attached hereto
constitute the entire agreement of the parties hereto relating to the matters
covered hereby and supersede any previous agreements. If any provision is held
to be illegal, unenforceable or invalid for any reason, the remaining provisions
shall not be affected or impaired thereby.
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27.2 This Agreement relates only to the subject matter hereof. Nothing
in this Agreement shall effect the relationship, rights, duties or other
obligations of the parties hereto governed by any other agreement.
Article 28 LIMITATION OF LIABILITY
28.1 It is understood and expressly stipulated that neither the
Shareholders nor the Trustees or officers of the Fund shall be personally liable
hereunder. All persons dealing with the Fund must look solely to the property of
the Fund for enforcement of any claims against the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, as of the day and year first above
written.
RWB/WPG U.S. LARGE STOCK FUND
By:___________________________________
Title: _______________________________
FIRST DATA INVESTOR SERVICES GROUP, INC.
By: __________________________________
Title: _______________________________
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Schedule A
DUTIES OF INVESTOR SERVICES GROUP
---------------------------------
A. TRANSFER AGENT SERVICES
-----------------------
1. SHAREHOLDER INFORMATION. Investor Services Group shall maintain a
record of the number of Shares held by each Shareholder of record which shall
include name, address, taxpayer identification and which shall indicate whether
such Shares are held in certificates or uncertificated form.
2. SHAREHOLDER SERVICES. Investor Services Group shall respond as
appropriate to all inquiries and communications from Shareholders relating to
Shareholder accounts with respect to its duties hereunder and such other
correspondence as may be from time to time mutually agreed upon between Investor
Services Group and the Fund.
3. SHARE CERTIFICATES.
(a) At the expense of the Fund, the Fund shall supply Investor
Services Group with an adequate supply of blank share certificates to meet
Investor Services Group requirements therefor. Such Share certificates shall be
properly signed by facsimile. The Fund agrees that, notwithstanding the death,
resignation, or removal of any officer of the Fund whose signature appears on
such certificates, Investor Services Group or its agent may continue to
countersign certificates which bear such signatures until otherwise directed by
Written Instructions.
(b) Investor Services Group shall issue replacement Share
certificates in lieu of certificates which have been lost, stolen or destroyed,
upon receipt by Investor Services Group of properly executed affidavits and lost
certificate bonds, in form satisfactory to Investor Services Group, with the
Fund and Investor Services Group as obligees under the bond.
(c) Investor Services Group shall also maintain a record of
each certificate issued, the number of Shares represented thereby and the
Shareholder of record. With respect to Shares held in open accounts or
uncertificated form (i.e., no certificate being issued with respect thereto)
Investor Services Group shall maintain comparable records of the Shareholders
thereof, including their names, addresses and taxpayer identification. Investor
Services Group shall further maintain a stop transfer record on lost and/or
replaced certificates.
4. MAILING COMMUNICATIONS TO SHAREHOLDERS; PROXY MATERIALS. Investor
Services Group will address and mail to Shareholders of the Fund, all reports to
Shareholders, dividend and distribution notices and proxy material for the
Fund's meetings of Shareholders. In connection with meetings of Shareholders,
Investor Services Group will prepare Shareholder lists, mail and certify as to
the mailing of proxy materials, process and tabulate returned proxy cards,
report on proxies voted prior to meetings, act as inspector of election at
meetings and certify Shares voted at meetings.
-16-
<PAGE>
5. SALES OF SHARES
(a) Investor Services Group shall not be required to issue any
Shares of the Fund where it has received a Written Instruction from the Fund or
official notice from any appropriate authority that the sale of the Shares of
the Fund has been suspended or discontinued. The existence of such Written
Instructions or such official notice shall be conclusive evidence of the right
of Investor Services Group to rely on such Written Instructions or official
notice.
(b) In the event that any check or other order for the payment
of money is returned unpaid for any reason, Investor Services Group will
endeavor to: (i) give prompt notice of such return to the Fund or its designee;
(ii) place a stop transfer order against all Shares issued as a result of such
check or order; and (iii) take such actions as Investor Services Group may from
time to time deem appropriate.
6. TRANSFER AND REPURCHASE
(a) Investor Services Group shall process all requests to
transfer or redeem Shares in accordance with the transfer or repurchase
procedures set forth in the Fund's Prospectus.
(b) Investor Services Group will transfer or repurchase Shares
upon receipt of Oral or Written Instructions or otherwise pursuant to the
Prospectus and Share certificates, if any, properly endorsed for transfer or
redemption, accompanied by such documents as Investor Services Group reasonably
may deem necessary.
(c) Investor Services Group reserves the right to refuse to
transfer or repurchase Shares until it is satisfied that the endorsement on the
instructions is valid and genuine. Investor Services Group also reserves the
right to refuse to transfer or repurchase Shares until it is satisfied that the
requested transfer or repurchase is legally authorized, and it shall incur no
liability for the refusal, in good faith, to make transfers or repurchases which
Investor Services Group, in its good judgement, deems improper or unauthorized,
or until it is reasonably satisfied that there is no basis to any claims adverse
to such transfer or repurchase.
(d) When Shares are redeemed, Investor Services Group shall,
upon receipt of the instructions and documents in proper form, deliver to the
Custodian and the Fund or its designee a notification setting forth the number
of Shares to be repurchased. Such repurchased shares shall be reflected on
appropriate accounts maintained by Investor Services Group reflecting
outstanding Shares of the Fund and Shares attributed to individual accounts.
(e) Investor Services Group, upon receipt of the monies paid
to it by the Custodian for the repurchase of Shares, pay such monies as are
received from the Custodian, all in accordance with the procedures described in
the written instruction received by Investor Services Group from the Fund.
-17-
<PAGE>
(f) Investor Services Group shall not process or effect any
repurchase with respect to Shares of the Fund after receipt by Investor Services
Group or its agent of notification of the suspension of the determination of the
net asset value of the Fund.
7. DIVIDENDS
(a) Upon the declaration of each dividend and each capital
gains distribution by the Board of Directors of the Fund with respect to Shares
of the Fund, the Fund shall furnish or cause to be furnished to Investor
Services Group Written Instructions setting forth the date of the declaration of
such dividend or distribution, the ex-dividend date, the date of payment
thereof, the record date as of which Shareholders entitled to payment shall be
determined, the amount payable per Share to the Shareholders of record as of
that date, the total amount payable to Investor Services Group on the payment
date and whether such dividend or distribution is to be paid in Shares at net
asset value.
(b) On or before the payment date specified in such resolution
of the Board of Directors, the Fund will pay to Investor Services Group
sufficient cash to make payment to the Shareholders of record as of such payment
date.
(c) If Investor Services Group does not receive sufficient
cash from the Fund to make total dividend and/or distribution payments to all
Shareholders of the Fund as of the record date, Investor Services Group will,
upon notifying the Fund, withhold payment to all Shareholders of record as of
the record date until sufficient cash is provided to Investor Services Group.
8. CASH MANAGEMENT SERVICES. Investor Services Group shall establish
and maintain various demand deposit accounts ("DDA's") with a third party cash
management services provider in order to facilitate the services being provided
by Investor Services Group hereunder. Investor Services Group shall retain any
and all interest income and/or related earnings credits which may be derived
from maintaining such DDA's.
9. LOST SHAREHOLDERS. Investor Services Group shall perform such
services as are required in order to comply with Rules 17a-24 and 17Ad-17 of the
34 Act (the Lost Shareholder Rules"), including, but not limited to those set
forth below. Investor Services Group may, in its sole discretion, use the
services of a third party to perform the some or all such services.
(a) documentation of electronic search policies and procedures;
(b) execution of required searches;
(c) creation and mailing of confirmation letters;
(d) taking receipt of returned verification forms;
(e) providing confirmed address corrections in batch via electronic
media;
(f) tracking results and maintaining data sufficient to comply with
the Lost Shareholder Rules; and
(g) preparation and submission of data required under the Lost
Shareholder Rules.
-18-
<PAGE>
10. In addition to and neither in lieu nor in contravention of the
services set forth above, Investor Services Group shall: (i) perform all the
customary services of a transfer agent, registrar, dividend disbursing agent and
agent of the dividend reinvestment and cash purchase plan as described herein
consistent with those requirements in effect as at the date of the performance
of such services. The detailed definition, frequency, limitations and associated
costs (if any) set out in the attached fee schedule, include but are not limited
to: maintaining all Shareholder accounts, preparing Shareholder meeting lists,
mailing proxies, tabulating proxies, mailing Shareholder reports to current
Shareholders, withholding taxes on U.S. resident and non-resident alien accounts
where applicable, preparing and filing U.S. Treasury Department Forms 1099 and
other appropriate forms required with respect to dividends and distributions by
federal authorities for all Shareholders.
B. FUND ACCOUNTING SERVICES
Performing fund accounting and bookkeeping services (including the
maintenance of such accounts, books and records of the Fund as may be required
by Section 31(a) of the 1940 Act) as follows:
- Daily, Weekly, and Monthly Reporting
- Portfolio and General Ledger Accounting
- Daily Valuation of all Portfolio Securities
- Daily Valuation and NAV Calculation
- Comparison of NAV to market movement
- Review research of price tolerance/fluctuation report to market
movements and events
- Research of items appearing on the price exception report
- Weekly cost monitoring along with market-to-market valuations in
accordance with Rule 2a-7
- Security trade processing
- Daily cash and position reconciliation with the custodian bank
- Daily updating of price and distribution rate information to the
Transfer Agent/Insurance Agent
- Daily support and report delivery to Portfolio Management
-19-
<PAGE>
- Daily calculation of Portfolio adviser fees and waivers
- Daily calculation of distribution rates
- Daily investable cash call
- Monitor and research aged receivables
- Collect aged income items and perform reclaims
- Update NASDAQ reporting
- Daily maintenance of each Portfolio's general ledger including
expense accruals
- Daily NAV per share notification to other vendors as required
- Calculation of 30-day SEC yields and total returns
- Preparation of month-end reconciliation package
- Monthly reconciliation of Portfolio expense records
- Application of monthly pay down gain/loss
- Preparation of all annual and semi-annual audit work papers
C. DCXCHANGE(SM) SERVICES
1. Investor Services Group has developed a recordkeeping service link
("DCXchange(SM)") between investment companies and benefit plan consultants (the
"Recordkeepers") which administer employee benefit plans under Section 401(a) of
the Internal Revenue Code (the "Plans").
2. Investor Services Group has entered into agreements with various
Recordkeepers relating to the recordkeeping and related services performed on
behalf of such Plans in connection with daily valuation and processing of orders
for investment and reinvestment of assets of the Plans in various investment
options available to the participants under such Plans (the "Participants").
3. The Fund desires to participate in the DCXchange(SM) Program and
retain Investor Services Group to perform such services with respect to shares
of the Funds ("Shares") held by or on behalf of the Participants as further
described herein and Investor Services Group is willing and able to furnish such
services on the terms and conditions hereinafter set forth.
-20-
<PAGE>
4. Investor Services Group agrees to perform recordkeeping and related
services for the benefit of the Plan Participants that maintain shares of the
Fund through Plans administered by certain Recordkeepers. Investor Services
Group shall subcontract with Recordkeepers to link the Investor Services Group
recordkeeping system with the Recordkeepers, in order for the Recordkeepers to
maintain Fund shares positions for each Participant.
-21-
<PAGE>
Schedule B
FEE SCHEDULE
------------
1. Transfer Agent Fees:
(a) Open Account Fees: Annual Monthly
Minimum
$17.64 $2,170
(b) Closed Accounts: $3 per account per year
(c) Retirement Plan Accounts (In addition to open/closed
account fees):
Setup fee: $10 per account
Maintenance Fee: $15 per plan account per year
Premature Distribution: $10 per transaction
(d) Cost Basis Accounting: $0.25 per account/per month
(e) NSCC: $.15 per transaction
$.10 per same day confirm
(f) Voice Response Usage: $.23 per minute
$.10 per call
$500 per month /line charge
(g) In-Bound Teleservicing: $.08 per call/digital recording
$100,000 annual ($8,333.33 per
month) total charge for all WP&G
affiliated funds for which Investor
Services Group provides TA
services.
(h) Transmission Fees: $500 per month total
charge for all WP&G affiliated
funds for which Investor Services
Group provides TA services.
(i) Lost Shareholder Search/Reporting: $2.75 per account search*
* The per account search fee shall be waived until June 2000
so long as the Fund retains Keane Tracers, Inc. ("KTI") to
provide the Fund with KTI's "In-Depth Research Program"
services.
2. Fund Accounting Fees: 4bp per year
-22-
<PAGE>
3. DCXchange(SM) : Fund positions of the Participants shall constitute
open accounts for which the Fund shall pay to Investor Services Group
the Transfer Agent - Open Account Fee specified above.
4. Print Mail Fees:
(a) Standards Fees:
Testing Application or Data Requirements: $3.00 / fax to client or
Record Keeper
Daily Work (Confirms):
Hand: $55/K with $50.00 minimum (includes 1 insert)
$0.06/each additional insert
Machine: $32/K with $50.00 minimum (includes 1 insert)
$0.02/each additional insert
Daily Checks:
Hand: $55/K with $100.00 minimum daily (includes 1 insert)
$0.07/each additional insert
Machine: $32/K with $75.00 minimum (includes 1 insert)
$0.02/each additional insert
* There is a $3.00 charge for each 3606 Form sent.
-23-
<PAGE>
Statements:
Hand: $60/K with $75.00 minimum (includes 1 insert)
$0.06/each additional insert
$125/K for intelligent inserting
Machine: $40/K with $75.00 minimum (includes 1 insert)
$0.02 each additional insert
$45/K for intelligent inserting
Periodic Checks:
Hand: $91/K with $100.00 minimum (includes 1 insert)
$0.08/each additional insert
Machine: $52/K with $100.00 minimum (includes 1 insert)
$0.01/each additional insert
Printing Charges: (price ranges dependent on volumes)
$0.08/per confirm/statement/page
$0.10/per check
Folding (Machine): $18/K
Folding (Hand): $.12 each
Presort Charge: $0.277 postage rate
$0.035 per piece
Courier Charge: $15.00 for each on call courier
trip/or actual cost for on demand
Overnight Charge: $3.50 per package service charge
plus Federal Express/Airborne charge
Inventory Storage: $20.00 for each inventory location
as of the 15th of the month
Inventory Receipt: $20.00 for each SKU / Shipment
Hourly work; special projects, opening envelopes, etc...: $24.00
--------------------------------------------------------- per hour
Special Pulls: $2.50 per account pull
Boxes/Envelopes: Shipping boxes $0.70 each
Oversized Envelopes $0.35 each
Forms Development/Programming Fee: $100/hr
Cutting Charges: $8.00/K
-24-
<PAGE>
(b) Special Mailing Fees:
This pricing is based on appropriate notification (standard of 30 day
notification) and scheduling for special mailings. Scheduling
requirements include having collateral arrive at agreed upon times in
advance of deadlines. Mailings which arise with shorter time frames and
turns will be billed at a maximum premium of 50% based on turn around
requirements.
Daily Work (Confirms):
Hand: $125.00 to create an admark tape
$8.00/K to zip + 4 data enhance with $125.00
minimum
$75.00/hr for any data manipulation
$6.00/K combo charge
Admark & Machine Insert
#10, #11, 6x9: $44/K to admark envelope and machine insert
1 piece, with $125.00 min
$2.50/K for each additional insert
$34/K to admark only with $75.00 minimum
$25.00/K hand sort
9x12: $100/K to admark envelope and machine insert
1 piece, with $125.00 min
$5.00/K for each additional insert $38/K to
admark only with $75.00 minimum $0.08 for
each hand insert
Admark & Hand Insert
#10, #11, 6x9: $0.08 for each hand insert
$25.00/K hand sort
9x12: $0.09 for each hand insert
$25.00/K hand sort
Pressure/Sensitive Labels:
$0.26 each to create, affix and hand insert 1 piece, with a
$75.00 minimum $0.06 for each hand insert
$0.10 to affix labels only
$0.10 to create labels only
Legal Drop: $150.00 / compliant legal drop per job and processing fees
Create Mailing List: $0.30 per entry with $50.00 minimum
Presort Fee: $0.035 per piece
4. Fee Adjustments:
After the one year anniversary of the effective date of this Agreement,
Investor Services Group may adjust the above fees once per calendar
year, upon thirty (30) days prior written notice in an amount not to
exceed the cumulative percentage increase in the Consumer Price Index
for All Urban Consumers (CPI-U) U.S. City Average, All items
(unadjusted) - (1982-84=100), published by the U.S. Department of Labor
since the last such adjustment in the Client's monthly fees (or the
Effective Date absent a prior such adjustment). Notwithstanding the
-25-
<PAGE>
foregoing, Investor Services Group agrees that there shall be no
increase to the above referenced Transfer Agent Fees or Fund Accounting
Fees during the Initial Term.
-26-
<PAGE>
Schedule C
OUT-OF-POCKET EXPENSES
----------------------
The Fund shall reimburse Investor Services Group monthly for applicable
out-of-pocket expenses, including, but not limited to the following items:
- Microfiche/microfilm production
- Magnetic media tapes and freight
- Printing costs, including certificates, envelopes, checks
and stationery
- Postage (bulk, pre-sort, ZIP+4, barcoding, first
- class) direct pass through to the Fund
- Due diligence mailings
- Telephone and telecommunication costs, including all lease,
maintenance and line costs
- Ad hoc reports
- Proxy solicitations, mailings and tabulations
- Daily & Distribution advice mailings
- Shipping, Certified and Overnight mail and insurance
- Year-end form production and mailings
- Terminals, communication lines, printers and other equipment
and any expenses incurred in connection with such terminals
and lines, as approved by the Fund
- Duplicating services
- Courier services
- Incoming and outgoing wire charges
- Federal Reserve charges for check clearance and other fund
related banking charges
- Overtime, as approved by the Fund
- Temporary staff, as approved by the Fund
- Travel and entertainment, as approved by the Fund
- Record retention, retrieval and destruction costs,
including, but not limited to exit fees charged by third
party record keeping vendors
- Third party audit reviews
- All conversion costs: including System start up costs
- All Systems enhancements after the conversion at the
rate of $150.00 per hour (except as otherwise stated)
- Insurance
- Pricing services (or services used to determine Fund NAV)
- Forms and supplies for the preparation of Board meetings and
other materials for the Fund
- SAS 70
- Cold Storage
- Vendor pricing comparison
- Manual pricing
-27-
<PAGE>
- Such other miscellaneous expenses reasonably incurred by
Investor Services Group in performing its duties and
responsibilities under this Agreement.
The Fund agrees that postage and mailing expenses will be paid on the
day of or prior to mailing as agreed with Investor Services Group. In addition,
the Fund will promptly reimburse Investor Services Group for any other
unscheduled expenses incurred by Investor Services Group whenever the Fund and
Investor Services Group mutually agree that such expenses are not otherwise
properly borne by Investor Services Group as part of its duties and obligations
under the Agreement.
-28-
<PAGE>
Schedule D
Fund Documents
- Certified copy of the Articles of Incorporation of the Fund,
as amended
- Certified copy of the By-laws of the Fund, as amended
- Copy of the resolution of the Board of Directors authorizing
the execution and delivery of this Agreement
- Specimens of the certificates for Shares of the Fund, if
applicable, in the form approved by the Board of Directors of
the Fund, with a certificate of the Secretary of the Fund as
to such approval
- All account application forms and other documents relating to
Shareholder accounts or to any plan, program or service
offered by the Fund
- Certified list of Shareholders of the Fund with the name,
address and taxpayer identification number of each
Shareholder, and the number of Shares of the Fund held by
each, certificate numbers and denominations (if any
certificates have been issued), lists of any accounts against
which stop transfer orders have been placed, together with the
reasons therefore, and the number of Shares redeemed by the
Fund
- All notices issued by the Fund with respect to the Shares in
accordance with and pursuant to the Articles of Incorporation
or By-laws of the Fund or as required by law and shall perform
such other specific duties as are set forth in the Articles of
Incorporation including the giving of notice of any special or
annual meetings of shareholders and any other notices required
thereby.
-29-
<PAGE>
Schedule E
Systems Development
DEVELOPMENT EFFORTS
- -------------------
Investor Services Group agrees to undertake the development efforts listed
below. All programming will be completed in accordance with documented and
approved business requirements. All such documentation and business
requirement shall be mutually agree to in writing prior to the start of any
development work. Investor Services Group agrees to provide a total of 1700
programming hours for the automation projects listed below at no cost to
the Fund and to use all commercially reasonable efforts to ensure that such
development work shall be completed within twelve months of the execution
of the Agreement. The expense of any programming required to be undertaken
in excess of the 1700 hours will be borne by Weiss Peck & Greer.
Development Efforts:
- Dividend sweep to another mutual fund as defined in the WPG
Transmission Enhancement Referral Business Requirements dated July
21, 1998 Section III, Issue VII.
- Transmission enhancement from WPG Margin Department according to
the WPG Transmission Enhancement Referral Business Requirements
dated July 21, 1998.
- PC link to PC link for transmission enhancement.
- Permit sweep accounts to reinvest dividends into accounts that
have a zero balance.
- Full automation of the Trust's December position file.
- Suppression of all December statements except for December 31st
statements.
INDEPENDENT AUDITORS' CONSENT
To the Shareholders and Board of Trustees of the
RWB/WPG U.S. Large Stock Fund:
We consent to the use of our report dated January 19, 1999 with respect to the
RWB/WPG U.S. Large Stock Fund incorporated herein by reference and to the
references to our Firm under the headings "Financial Highlights" in the
Prospectus and "Independent Auditors" and "Financial Statements" in the
Statement of Additional Information.
KPMG LLP
New York, New York
February 26, 1999
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<NAME> RWB/WPG US LARGE STOCK
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<INVESTMENTS-AT-COST> 114113
<INVESTMENTS-AT-VALUE> 187432
<RECEIVABLES> 318
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<TOTAL-ASSETS> 187759
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 864
<TOTAL-LIABILITIES> 864
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 112407
<SHARES-COMMON-STOCK> 24
<SHARES-COMMON-PRIOR> 26
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<ACCUMULATED-NET-GAINS> 682
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<NET-ASSETS> 186896
<DIVIDEND-INCOME> 3116
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<EXPENSES-NET> 810
<NET-INVESTMENT-INCOME> 2335
<REALIZED-GAINS-CURRENT> 30219
<APPREC-INCREASE-CURRENT> 10365
<NET-CHANGE-FROM-OPS> 42919
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2646)
<DISTRIBUTIONS-OF-GAINS> (29713)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 12905
<NUMBER-OF-SHARES-REDEEMED> (81272)
<SHARES-REINVESTED> 31752
<NET-CHANGE-IN-ASSETS> (26055)
<ACCUMULATED-NII-PRIOR> 773
<ACCUMULATED-GAINS-PRIOR> 176
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 501
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1016
<AVERAGE-NET-ASSETS> 192682
<PER-SHARE-NAV-BEGIN> 7.43
<PER-SHARE-NII> .14
<PER-SHARE-GAIN-APPREC> 1.65
<PER-SHARE-DIVIDEND> (.13)
<PER-SHARE-DISTRIBUTIONS> (1.46)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.63
<EXPENSE-RATIO> .42
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
