<PAGE>
As filed with the Securities and Exchange Commission on May 9, 1997
Securities Act File No. 33-65632;
Investment Company Act File No. 811-7840
- --------------------------------------------------------------------------------
U.S. 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. 6 /X/
AND/OR
REGISTRATION STATEMENT UNDER
INVESTMENT COMPANY ACT OF 1940 /X/
AMENDMENT NO. 8 /X/
(Check appropriate box or boxes)
------------------------
SCHRODER SERIES TRUST
(Exact Name of Registrant as Specified in Charter)
787 Seventh Avenue, New York, New York 10019
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 492-6000
-----------------
It is proposed that this filing will become effective (Check appropriate box):
--- immediately upon filing pursuant to paragraph (b)
--- on (date) pursuant to paragraph (b)
--- 60 days after filing pursuant to paragraph (a)(1)
--- on (date) pursuant to paragraph (a)(1)
X 75 days after filing pursuant to paragraph (a)(2)
---
--- on (date) pursuant to paragraph (a)(2)
-------------------
CATHERINE A. MAZZA
VICE PRESIDENT
SCHRODER SERIES TRUST
787 SEVENTH AVENUE
NEW YORK, NEW YORK 10019
(Name and Address of Agent for Service)
Copies to:
TIMOTHY W. DIGGINS, ESQ.
ROPES & GRAY
ONE INTERNATIONAL PLACE
BOSTON, MASSACHUSETTS 02110-2624
--------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
--------------
The Registrant has registered an indefinite number or amount of securities
under the Securities Act of 1933, as amended, pursuant to Rule 24f-2 and filed a
Rule 24f-2 notice for its fiscal year most recently ended on December 12, 1996.
THIS POST-EFFECTIVE AMENDMENT RELATES SOLELY TO SCHRODER MID-CAP VALUE FUND, A
SERIES OF SHARES OF THE REGISTRANT. NO INFORMATION RELATING TO ANY OTHER SERIES
OF SHARES OF SCHRODER SERIES TRUST IS AMENDED OR SUPERSEDED HEREBY.
<PAGE>
SCHRODER SERIES TRUST
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
PART A PROSPECTUS FOR MID-CAP VALUE FUND
N-1A ITEM NO. LOCATION
<S> <C> <C>
1. Cover Page. . . . . . . . . . . . . . . . . . . . . . Cover page
2. Synopsis. . . . . . . . . . . . . . . . . . . . . . . Summary of expenses
3. Condensed Financial Information . . . . . . . . . . . Not Applicable
4. General Description of Registrant . . . . . . . . . . Investment objectives and policies;
Additional information about the
Trust
5. Management of the Fund. . . . . . . . . . . . . . . . Additional information about the
Trust; Management of the Trust
5A. Management's Discussion of Fund Performance . . . . . Not applicable
6. Capital Stock and Other Securities. . . . . . . . . . Additional information about the
Trust; Distributions
7. Purchase of Securities Being Offered. . . . . . . . . How to buy shares; Determination
of Net Asset Value
8. Redemption or Repurchase. . . . . . . . . . . . . . . How to sell shares
9. Pending Legal Proceedings . . . . . . . . . . . . . . Not Applicable
PART B STATEMENT OF ADDITIONAL INFORMATION FOR MID-CAP VALUE FUND
N-1A ITEM NO. LOCATION
10. Cover Page. . . . . . . . . . . . . . . . . . . . . . Cover Page
11. Table of Contents . . . . . . . . . . . . . . . . . . Cover Page
12. General Information and History . . . . . . . . . . . Additional information about the
Trust (Part A)
13. Investment Objectives and Policies. . . . . . . . . . Investment Objectives and Policies
of the Fund and Risk
Considerations; Investment
Restrictions
14. Management of the Registrant. . . . . . . . . . . . . Management Contract
15. Control Persons and Principal Holders
of Securities . . . . . . . . . . . . . . . . . . . . Not Applicable
16. Investment Advisory and Other Services. . . . . . . . Management Contract
17. Brokerage Allocation. . . . . . . . . . . . . . . . . Management Contract (Brokerage
and Research Services)
18. Capital Stock and Other Securities. . . . . . . . . . Additional information about the Trust
(Part A); Distributions (Part A)
19. Purchase, Redemption, and Pricing
of Securities Being Offered . . . . . . . . . . . . . How to buy shares (Part A); How to
sell shares (Part A); Determination
of Net Asset Value
20. Tax Status. . . . . . . . . . . . . . . . . . . . . . Taxes (Part A); Taxes
21. Underwriters. . . . . . . . . . . . . . . . . . . . . Principal Underwriter
22. Calculation of Performance Data . . . . . . . . . . . Performance Information
23. Financial Statements. . . . . . . . . . . . . . . . . Not Applicable
</TABLE>
PART C
The information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C to this Registration Statement.
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
POST-EFFECTIVE AMENDMENT TO THE TRUST'S REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BUT HAS
NOT YET BECOME EFFECTIVE. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO
BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE.
THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF, THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION
OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION
MAY 12, 1997
SCHRODER MID-CAP VALUE FUND
Prospectus
July , 1997
SCHRODER MID-CAP VALUE FUND seeks long-term capital appreciation. The Fund
invests primarily in publicly traded common stocks of "mid-cap" companies --
companies with market capitalizations of between $750 million and $5 billion.
The Fund is a series of shares of Schroder Series Trust.
This Prospectus explains concisely the information about the Fund that a
prospective investor should know before investing in the Fund. Please read it
carefully and keep it for future reference. Investors can find more detailed
information about the Fund and Schroder Series Trust in the July , 1997
Statement of Additional Information, as amended from time to time. For a free
copy of the Statement of Additional Information, please call 1-800-464-3108.
The Statement of Additional Information has been filed with the Securities and
Exchange Commission and is incorporated into this Prospectus by reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
<PAGE>
TABLE OF CONTENTS
PAGE
----
Summary of expenses............................................................3
Investment objectives and policies.............................................4
Portfolio turnover.............................................................5
How to buy shares..............................................................5
How to sell shares.............................................................6
Exchanges......................................................................7
Determination of net asset value...............................................7
Distributions..................................................................7
Taxes..........................................................................7
Management of the Trust........................................................8
Performance information........................................................9
Additional information about the Trust.........................................9
<PAGE>
SUMMARY OF EXPENSES
Expenses are one of several factors to consider when investing in the Fund. As
indicated under "Shareholder Transaction Expenses" below, there are no
transaction expenses associated with investing in or redeeming shares of the
Fund. The expenses the Fund expects to incur in its first full year of
operations are set forth below under "Annual Operating Expenses." The Example
shows the cumulative expenses attributable to a $1,000 investment in the Fund
over specified periods.
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases None
Maximum Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees None
Exchange Fee None
ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees* [.95%]
12b-1 Fees None
Other Expenses* [.75%]
-----
Total Fund Operating Expenses* [1.70%]
------------------------
* The Management Fees, Other Expenses, and Total Fund Operating Expenses
of the Fund are subject to expense limitations currently in effect. See
"Management of the Trust" below.
EXAMPLE
Your investment of $1,000 in the Fund would incur the following expenses,
assuming 5% annual return and redemption at the end of each period:
1 YEAR 3 YEARS
------ -------
$[17] $[54]
The tables and Example are provided to help you understand the expenses of
investing in the Fund and your share of the operating expenses of the Fund. The
information concerning the Fund is based on the expenses the Fund expects to
incur during its first full year of operations. THE TABLES AND EXAMPLE DO NOT
REPRESENT PAST OR FUTURE EXPENSE LEVELS. ACTUAL EXPENSES MAY BE GREATER OR LESS
THAN THOSE SHOWN. FEDERAL REGULATIONS REQUIRE THE EXAMPLE TO ASSUME A 5% ANNUAL
RETURN, BUT ACTUAL ANNUAL RETURN WILL VARY.
3
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
SCHRODER MID-CAP VALUE FUND'S INVESTMENT OBJECTIVE IS TO SEEK LONG-TERM CAPITAL
APPRECIATION. The Fund invests primarily in publicly traded common stocks of
"mid-cap" companies -- companies with market capitalizations of between $750
million and $5 billion. In selecting investments for the Fund, Schroder Capital
Management Inc. ("Schroder"), the Fund's investment adviser, tries to identify
companies that have good prospects for earnings growth and whose
price-to-earnings ratios are lower than the average price-to-earnings ratios of
comparable companies.
Schroder believes that certain mid-cap companies may be undervalued and may
offer greater opportunities for capital appreciation than larger companies, for
a number of reasons. For example, many mid-cap companies have not attracted
substantial coverage by Wall Street analysts or a substantial institutional
following. As a result, many investors may not have recognized the full values
of such companies or of their potential for earnings growth, or of their
financial or business assets. In addition, a mid-cap company may, because of
its smaller size, be able to adapt more quickly to competitive or economic
changes than larger, longer established companies.
For similar reasons, mid-cap companies may present different investment risks
than do large-cap companies. Such companies may have limited product lines,
markets, or financial resources and may depend on a limited management group.
Their securities may trade less frequently and in smaller volume than more
widely held securities, and their values may fluctuate more sharply than other
securities. There may be less publicly available information about the issuers
of these securities or less market interest in such securities than in the case
of larger companies. Schroder's strategy for the Fund includes investing in
certain stocks before other investors recognize their value. The result could
be a lack of stock price movement in the short term. Investors should therefore
have a long-term investment horizon when investing in the Fund.
Although the Fund will seek to invest principally in common stocks, it may also
invest in preferred stocks, warrants, and securities convertible into common or
preferred stocks if Schroder believes such investments would help achieve the
Fund's objective. Under normal circumstances, the Fund will invest at least 65%
of its assets in securities of companies determined by Schroder to be "mid-cap"
companies. The Fund may hold a portion of its assets in cash or money market
instruments.
At times Schroder may decide that conditions in the securities markets make
pursuing the Fund's basic investment strategy inconsistent with the best
interests of its shareholders. At such times, Schroder may temporarily use
alternate investment strategies primarily designed to reduce fluctuations in the
value of the Fund's assets. In implementing these defensive strategies, the
Fund would invest any portion of its assets in high-quality debt securities, or
hold any portion of its assets in cash or money market instruments, to the
extent Schroder might consider consistent with such defensive strategies. It is
impossible to predict when, or for how long, the Fund will use these alternate
strategies.
4
<PAGE>
The Fund is a diversified series of Schroder Series Trust, an open-end
management investment company. The investment policies of the Fund may be
changed by the Trustees without shareholder approval unless otherwise stated.
All percentage limitations on investments will apply at the time of
investment and will not be considered violated unless an excess or deficiency
occurs or exists immediately after and as a result of the investment. There
can, of course, be no assurance that the Fund will achieve its investment
objective.
LIQUIDITY. The Fund will not invest more than 15% of its assets in securities
determined by Schroder to be illiquid. Certain securities that are restricted
as to resale may nonetheless be resold by the Fund in accordance with Rule 144A
under the Securities Act of 1933, as amended. Such securities may be determined
by Schroder to be liquid for purposes of compliance with the limitation on the
Fund's investment in illiquid securities. There can, however, be no assurance
that the Fund will be able to sell such securities at any time when Schroder
deems it advisable to do so or at prices prevailing for comparable securities
that are more widely held.
SECURITIES LOANS AND REPURCHASE AGREEMENTS. The Fund may lend portfolio
securities amounting to not more than 25% of its assets to broker-dealers, and
may enter into repurchase agreements on up to 25% of its assets. These
transactions must be fully collateralized at all times, but involve some risk to
the Fund if the other party should default on its obligation and the Fund is
delayed or prevented from recovering the collateral.
PORTFOLIO TURNOVER
The length of time the Fund has held a particular security is not generally a
consideration in investment decisions. The investment policies of the Fund may
lead to frequent changes in the Fund's investments, particularly in periods of
volatile market movements. A change in the securities held by the Fund is known
as "portfolio turnover." Portfolio turnover generally involves some expense to
the Fund, including brokerage commissions or dealer mark-ups and other
transaction costs on the sale of securities and reinvestment in other
securities. Such sales may result in realization of taxable capital gains. The
Fund's annual portfolio turnover is expected to be less than 100%.
HOW TO BUY SHARES
Shares of the Fund are sold at the net asset value per share of the Fund next
determined after Schroder Fund Advisors Inc., the Fund's distributor, receives
your order. In order for you to receive that day's net asset value, Schroder
Fund Advisors Inc. must receive your order before the close of regular trading
on the New York Stock Exchange.
The minimum initial investment in the Fund is $25,000, and the minimum for each
subsequent investment is $1,000. Schroder may, in its sole discretion, accept
smaller initial or subsequent investments so long as the investor is an employee
of Schroder or any of its affiliates or has an
5
<PAGE>
investment account with Schroder in amounts specified by Schroder from time to
time. The Fund will not issue share certificates unless a shareholder so
requests.
Shares of the Fund may be purchased for cash or in exchange for securities held
by the investor, subject to the determination by Schroder that the securities
are acceptable. (For purposes of determining whether securities will be
acceptable, Schroder will consider, among other things, whether they are liquid
securities of a type consistent with the investment objectives and policies of
the Fund and having a readily ascertainable value.) If the Fund receives
securities from an investor in exchange for shares of the Fund, the Fund will
under some circumstances have the same tax basis in the securities as the
investor had prior to the exchange (and the Fund's gain for tax purposes would
be calculated with regard to the investor's tax basis). Any gain on the sale of
those securities would be subject to distribution as capital gain to all of the
Fund's shareholders. Schroder reserves the right to reject any particular
investment. Securities accepted by Schroder will be valued in the same manner
as are the Fund's portfolio securities as of the time of the next determination
of the Fund's net asset value. All dividend, subscription, or other rights
which are reflected in the market price of accepted securities at the time of
valuation become the property of the Fund and must be delivered to the Fund upon
receipt by the investor. A gain or loss for federal income tax purposes may be
realized by investors upon the exchange. Investors interested in purchases
through exchange should telephone Schroder at (800) 464-3108.
You can make regular investments of $1,000 or more per month through automatic
deductions from your bank checking account. Application forms are available
from the Trust's transfer agent, Boston Financial Data Services, Inc., Two
Heritage Drive, North Quincy, Massachusetts 02171 ("Boston Financial").
HOW TO SELL SHARES
Shares of the Fund may be redeemed on any business day by sending a letter of
instruction or stock power form to Boston Financial. The redemption price is
the net asset value per share next determined after receipt of the redemption
request in good order. A redemption request is in good order if it includes
the exact name in which the shares are registered, the investor's account
number, and the number of shares or the dollar amount of shares to be redeemed,
and if it is signed exactly in accordance with the registration form.
Signatures must be guaranteed by a bank, broker/dealer, or certain other
financial institutions. Boston Financial may require additional documentation
from shareholders that are corporations, partnerships, agents, fiduciaries, or
surviving joint owners.
Payment on redemption will be made as promptly as possible and in any event
within seven days after the request for redemption is received in writing by
Boston Financial in good order. (The Trust generally sends payment for shares
the business day after a request is received.) Under unusual circumstances, the
Trust may suspend redemptions or postpone payment for more than seven days, as
permitted by law.
6
<PAGE>
EXCHANGES
You can exchange your shares of the Fund for shares of any other series in
Schroder Series Trust at any time at their respective net asset values. Contact
Boston Financial at 1-800-464-3108 for a prospectus for those other series. To
exchange shares, you should complete an exchange authorization form available
from Boston Financial and mail it to Boston Financial.
For federal income tax purposes, an exchange is treated as a sale of shares and
generally results in a capital gain or loss. The Trust reserves the right to
change or suspend the exchange privilege at any time. Shareholders would be
notified of any such change or suspension.
DETERMINATION OF NET ASSET VALUE
The Fund calculates the net asset value of a share by dividing the total value
of its assets, less liabilities, by the number of shares outstanding. Shares
are valued as of the close of regular trading on the New York Stock Exchange
each day the Exchange is open. Portfolio securities for which market quotations
are readily available are stated at market value. Short-term investments that
will mature in 60 days or less are stated at amortized cost, which approximates
market value. All other securities and assets are valued at their fair value
following procedures approved by the Trustees.
DISTRIBUTIONS
The Fund distributes any net investment income and any net realized capital
gains at least annually. Distributions from net investment income, if any, are
expected to be small. Distributions from net capital gains are made after
applying any available capital loss carryovers.
YOU CAN CHOOSE FROM THREE DISTRIBUTION OPTIONS: (1) reinvest all distributions
in additional Fund shares; (2) receive distributions from net investment income
in cash while reinvesting capital gains distributions in additional shares; or
(3) receive all distributions in cash. You can change your distribution option
by notifying Boston Financial in writing. If you do not select an option when
you open your account, all distributions by the Fund will be reinvested in
shares of the Fund. You will receive a statement confirming reinvestment of
distributions in additional Fund shares promptly following the period in which
the reinvestment occurs.
7
<PAGE>
TAXES
The Fund intends to qualify as a "regulated investment company" for federal
income tax purposes and to meet all other requirements that are necessary for
it to be relieved of federal taxes on income and gains it distributes to
shareholders. The Fund will distribute substantially all of its net
investment income and net capital gain income on a current basis.
All Fund distributions will be taxable to you as ordinary income, except that
any distributions of net long-term capital gains will be taxed as such,
regardless of how long you have held the shares. Distributions will be taxable
as described above whether received in cash or in shares through the
reinvestment of distributions.
Early in each year the Trust will notify you of the amount and tax status of
distributions paid to you by the Fund for the preceding year.
The foregoing is a summary of certain federal income tax consequences of
investing in the Fund. You should consult your tax adviser to determine the
precise effect of an investment in the Fund on your particular tax situation.
MANAGEMENT OF THE TRUST
The Trustees of the Trust are responsible for generally overseeing the conduct
of the Trust's business. The Trust's investment adviser is Schroder Capital
Management Inc. ("Schroder"). Schroder is a wholly owned subsidiary of
Schroders Incorporated, which engages through its subsidiary firms in the
investment banking, asset management, and securities businesses. Affiliates of
Schroders Incorporated (or their predecessors) have been investment managers
since 1927. Schroder itself has been an investment manager since 1962, and
served as investment manager for approximately $4 billion as of December 31,
1996. Schroders Incorporated is an indirect, wholly owned U.S. subsidiary of
Schroders plc, a publicly owned holding company organized under the laws of
England. Schroders plc and its affiliates engage in international merchant
banking and investment management businesses, and as of December 31, 1996 had
under management assets of approximately $150 billion. Schroder Fund Advisors
Inc. is a wholly owned subsidiary of Schroder Capital Management International
Inc. Schroder Capital Management International Inc. is also a wholly owned
subsidiary of Schroders Incorporated.
Subject to such policies as the Trustees may determine, Schroder furnishes a
continuing investment program for the Fund and makes investment decisions on its
behalf. Subject to the control of the Trustees, Schroder also manages the
Trust's other affairs and business. The Trust's principal office is located at
787 Seventh Avenue, New York, New York 10019 (which is also the address of
Schroder's principal office), and its telephone number is (212) 641-3900.
Schroder has served as investment adviser to the Trust since its inception.
In order to limit the Fund's expenses, Schroder has voluntarily agreed to reduce
its compensation (and, if necessary, to pay certain expenses of the Fund) until
October 31, 1998 to the extent the
8
<PAGE>
Fund's expenses (other than Schroder's compensation, brokerage, interest, taxes,
deferred organizational expenses, and extraordinary expenses) exceed the annual
rate of [1.70%] of the Fund's average net assets. The Trust pays all expenses
not assumed by Schroder, including Trustees' fees, auditing, legal, custodial,
and investor servicing and shareholder reporting expenses.
Schroder's investment decisions for the Fund are generally made by a committee
of Schroder's investment professionals. Ms. Nancy B. Tooke, Director, Senior
Vice President, and Portfolio Manager at Schroder, and Ms. Locke W. Ogens, First
Vice President and Portfolio Manager at Schroder, are primarily responsible for
making recommendations to the committee for the Fund. Ms. Tooke is also
responsible for making recommendations to the committee for Schroder Small
Capitalization Value Fund, another series of shares of the Trust and a
registered investment company.
Schroder places all orders for purchases and sales of the Fund's investments.
In selecting broker-dealers, Schroder may consider research and brokerage
services furnished to it and its affiliates. Schroder Wertheim & Co.
Incorporated, an affiliate of Schroder, may receive brokerage commissions from
the Fund in accordance with procedures adopted by the Trustees under the
Investment Company Act of 1940 which require periodic review of these
transactions.
PERFORMANCE INFORMATION
Total return data may from time to time be included in advertisements about the
Fund. "Total return" for the life of the Fund through the most recent calendar
quarter represents the average annual compounded rate of return on an investment
of $1,000 in the Fund during that period. Total return for any period of one
year or less represents the actual rate of return on such an investment earned
during the period, although annualized figures may also be shown in
advertisements.
ALL DATA IS BASED ON THE FUND'S PAST INVESTMENT RESULTS AND DOES NOT PREDICT
FUTURE PERFORMANCE. Investment performance, which will vary, is based on many
factors, including market conditions, the composition of the Fund's portfolio,
and the Fund's operating expenses. Investment performance also often reflects
the risks associated with the Fund's investment objectives and policies.
Quotations of total return for any period when an expense limitation is in
effect will be greater than if the limitation had not been in effect. These
factors should be considered when comparing the Fund's investment results to
those of other mutual funds and other investment vehicles. The Fund's
performance may be compared to various indices. See the Statement of Additional
Information for a fuller discussion of performance information.
ADDITIONAL INFORMATION ABOUT THE TRUST
The Trust was established as a Massachusetts business trust in 1993. The Trust
has an unlimited number of shares of beneficial interest that may, without
shareholder approval, be divided into an unlimited number of series of such
shares, which, in turn, may be divided into an unlimited number of classes of
such shares. The Trust's shares of beneficial interest are presently divided
9
<PAGE>
into six different series, including the Fund. Each share has one vote, with
fractional shares voting proportionally. Shares are freely transferable, are
entitled to dividends as declared by the Trustees, and, if the Fund were
liquidated, would receive the net assets of the Fund. The Fund may suspend the
sale of shares at any time and may refuse any order to purchase shares.
Although the Trust is not required to hold annual meetings of its shareholders,
shareholders have the right to call a meeting to elect or remove Trustees, or to
take other actions as provided in the Declaration of Trust.
If you own fewer shares of the Fund than a minimum amount set by the Trustees
(presently 50 shares), the Trust may choose to redeem your shares in the Fund
and pay you for them. You will receive at least 30 days written notice before
the Trust redeems your shares, and you may purchase additional shares at any
time to avoid a redemption. The Trust may also redeem shares if you own shares
of the Fund above a maximum amount set by the Trustees. There is currently no
maximum, but the Trustees may establish one at any time, which could apply to
both present and future shareholders.
Schroder Fund Advisors Inc., 787 Seventh Avenue, New York, New York 10019, is
the principal underwriter for the Trust. State Street Bank and Trust Company,
225 Franklin Street, Boston, Massachusetts 02110, is the Trust's administrator
and custodian. The Trust currently pays State Street fees for its services as
administrator at the annual rate of .08% of the Fund's average daily net assets
(subject to certain minimum charges). The Fund's transfer agent and registrar
is Boston Financial Data Services, Inc., Two Heritage Drive, North Quincy,
Massachusetts 02171.
10
<PAGE>
SCHRODERS
Schroder Series Trust
---------------
Schroder Mid-Cap Value Fund
---------------
PROSPECTUS
July , 1997
Schroder Series Trust
P.O. Box 8507
Boston, Mass. 02266
1-800-464-3108
11
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
POST-EFFECTIVE AMENDMENT TO THE TRUST'S REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BUT HAS
NOT YET BECOME EFFECTIVE. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO
BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE.
THIS STATEMENT OF ADDITIONAL INFORMATION SHALL NOT CONSTITUTE AN OFFER TO SELL
OR THE SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF, THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY
SUCH STATE.
SUBJECT TO COMPLETION
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED MAY 12, 1997
SCHRODER SERIES TRUST
MID-CAP VALUE FUND
FORM N-1A
PART B
STATEMENT OF ADDITIONAL INFORMATION
JUNE __, 1997
This Statement of Additional Information contains information that may be
of interest to investors but which is not included in the Prospectus of the
Mid-Cap Value Fund of Schroder Series Trust (the "Trust"). This Statement is
not a prospectus and should be read in conjunction with the Prospectus, as it
may be revised from time to time. Investors may obtain free copies of the
Prospectus by calling Schroder Capital Management Inc., the Trust's investment
adviser, at 1-800-464-3108.
<PAGE>
TABLE OF CONTENTS
DEFINITIONS....................................................................1
INVESTMENT OBJECTIVES AND POLICIES OF THE FUND
AND RISK CONSIDERATIONS.....................................................1
INVESTMENT RESTRICTIONS........................................................2
TRUSTEES AND OFFICERS..........................................................4
MANAGEMENT CONTRACT............................................................6
DETERMINATION OF NET ASSET VALUE...............................................9
TAXES.........................................................................10
PERFORMANCE INFORMATION.......................................................11
ORGANIZATION AND CAPITALIZATION...............................................11
PRINCIPAL UNDERWRITER.........................................................12
CUSTODIAN.....................................................................12
INDEPENDENT AUDITORS..........................................................12
SHAREHOLDER LIABILITY.........................................................12
OTHER INFORMATION.............................................................13
<PAGE>
SCHRODER SERIES TRUST
MID-CAP VALUE FUND
STATEMENT OF ADDITIONAL INFORMATION
DEFINITIONS
The "Trust" - Schroder Series Trust
"Schroder" - Schroder Capital Management Inc., the
Trust's investment adviser
The "Fund" - Schroder Mid-Cap Value Fund
INVESTMENT OBJECTIVES AND POLICIES OF THE FUND AND RISK CONSIDERATIONS
The investment objectives and policies of the Fund are described in the
Fund's Prospectus. This Statement contains additional information concerning
certain investment practices and investment restrictions of the Fund.
Except as described below under "Investment Restrictions", the investment
objectives and policies described in the Prospectus and in this Statement are
not fundamental, and the Trustees may change the investment objectives and
policies of the Fund without an affirmative vote of shareholders of the Fund.
REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements. A repurchase agreement is a
contract under which the Fund acquires a security for a relatively short period
(usually not more than one week) subject to the obligation of the seller to
repurchase and the Fund to resell such security at a fixed time and price
(representing the Fund's cost plus interest). It is the Fund's present
intention to enter into repurchase agreements only with member banks of the
Federal Reserve System and securities dealers meeting certain criteria as to
creditworthiness and financial condition established by the Trustees of the
Trust and only with respect to obligations of the U.S. government or its
agencies or instrumentalities or other high quality short term debt obligations.
Repurchase agreements may also be viewed as loans made by the Fund which are
collateralized by the securities subject to repurchase. Schroder will monitor
such transactions to ensure that the value of the underlying securities will be
at least equal at all times to the total amount of the repurchase obligation,
including the interest factor. If the seller defaults, the Fund could realize a
loss on the sale of the underlying security to the extent that the proceeds of
sale including accrued interest are less than the resale price provided in the
agreement including interest. In addition, if the seller should be involved in
bankruptcy or insolvency proceedings, the Fund may incur delay and costs in
selling the underlying security or may suffer a loss of principal and interest
if the Fund is treated as an unsecured creditor and required to return the
underlying collateral to the seller's estate.
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LOANS OF FUND SECURITIES
The Fund may lend its portfolio securities, provided: (1) the loan is
secured continuously by collateral consisting of U.S. Government Securities,
cash, or cash equivalents adjusted daily to have market value at least equal to
the current market value of the securities loaned; (2) the Fund may at any time
call the loan and regain the securities loaned; (3) the Fund will receive any
interest or dividends paid on the loaned securities; and (4) the aggregate
market value of securities of the Fund loaned will not at any time exceed
one-third of the total assets of the Fund. In addition, it is anticipated that
the Fund may share with the borrower some of the income received on the
collateral for the loan or that it will be paid a premium for the loan. Before
the Fund enters into a loan, Schroder considers all relevant facts and
circumstances including the creditworthiness of the borrower. The risks in
lending portfolio securities, as with other extensions of credit, consist of
possible delay in recovery of the securities or possible loss of rights in the
collateral should the borrower fail financially. Although voting rights or
rights to consent with respect to the loaned securities pass to the borrower,
the Fund retains the right to call the loans at any time on reasonable notice,
and it will do so in order that the securities may be voted by the Fund if the
holders of such securities are asked to vote upon or consent to matters
materially affecting the investment. The Fund will not lend portfolio
securities to borrowers affiliated with the Fund.
INVESTMENT RESTRICTIONS
The Fund has adopted the following investment restrictions which may not be
changed without the affirmative vote of a "majority of the outstanding voting
securities" of the Fund, which is defined in the Investment Company Act of 1940
to mean the affirmative vote of the lesser of (1) more than 50% of the
outstanding shares and (2) 67% or more of the shares present at a meeting if
more than 50% of the outstanding shares are represented at the meeting in person
or by proxy. The Fund may not:
1. Borrow money in excess of 10% of the value (taken at the lower of cost
or current value) of its total assets (not including the amount
borrowed) at the time the borrowing is made, and then only from banks
as a temporary measure (not for leverage) in situations which might
otherwise require the untimely disposition of portfolio investments or
for extraordinary or emergency purposes. Such borrowings will be
repaid before any additional investments are purchased.
2. Pledge, hypothecate, mortgage, or otherwise encumber its assets in
excess of 15% of its total assets (taken at the lower of cost and
current value) and then only in connection with borrowings permitted
by restriction 1 above.
3. Purchase securities on margin, except such short-term credits as may
be necessary for the clearance of purchases and sales of securities,
and except that it may make margin payments in connection with
transactions in futures contracts, options, and other financial
instruments.
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4. Underwrite securities issued by other persons except to the extent
that, in connection with the disposition of its portfolio investments,
it may be deemed to be an underwriter under the federal securities
laws.
5. Purchase or sell real estate or interests in real estate limited
partnerships, although it may purchase securities of issuers which
deal in real estate, securities which are secured by interests in real
estate, and securities representing interests in real estate, and it
may acquire and dispose of real estate or interests in real estate
acquired through the exercise of its rights as a holder of debt
obligations secured by real estate or interests therein.
6. Purchase or sell commodities or commodity contracts, except that it
may purchase or sell financial futures contracts and options and other
financial instruments.
7. Make loans, except by purchase of debt obligations in which the Fund
may invest consistent with its investment policies, by entering into
repurchase agreements with respect to not more than 25% of its total
assets (taken at current value), or through the lending of its
portfolio securities with respect to not more than 25% of its total
assets.
8. Invest more than 25% of the value of its total assets in securities of
issuers in any one industry. (Securities issued or guaranteed as to
principal or interest by the U.S. Government or its agencies or
instrumentalities are not considered to represent industries.)
In addition, it is contrary to the Trust's present policy, which may be
changed without shareholder approval, for the Fund to invest more than 15% of
its net assets in securities which are not readily marketable, including
securities restricted as to resale (other than securities restricted as to
resale but determined by the Trustees, or persons designated by the Trustees to
make such determinations, to be readily marketable).
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All percentage limitations on investments will apply at the time of
investment and shall not be considered violated unless an excess or deficiency
occurs or exists immediately after and as a result of such investment. Except
for investment restrictions 1 through 8 listed above, the other investment
policies described in the Prospectus and this Statement are not fundamental and
may be changed by the Trustees, without shareholder approval. As a matter of
policy, the Trustees would not materially change the Fund's investment objective
without shareholder approval.
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TRUSTEES AND OFFICERS
The Trustees of the Trust are responsible for the general oversight of the
Trust's business. The Trustees and executive officers of the Trust and their
principal occupations during the last five years are set forth below. The
mailing address of each of the officers and Trustees is 787 Seventh Avenue, New
York, New York 10019.
David N. Dinkins, Trustee. 69. Professor, Columbia University School of
International and Public Affairs. Director, American Stock Exchange, Amrep
Corporation, Carver Federal Savings Bank, New World Communications Group,
Incorporated, and Transderm Laboratory Corporation. Formerly, Mayor, City of
New York.
(*) David Gibson, Trustee and Vice President of the Trust. 36. Director,
Schroder Capital Management Inc. and Schroder Investment Management Ltd.
Director and Senior Vice President, Schroder Capital Management International
Inc.
John I. Howell, Trustee. 80. Trustee, Schroder Capital Funds and Schroder
Capital Funds (Delaware). Director, Schroder Asian Growth Fund, Inc. and
American International Life Assurance Company of New York. Private consultant
since 1987.
Peter S. Knight, Trustee. 46. Partner, Wunder, Diefenderfer, Cannon &
Thelen. Previously, Campaign Manager, Clinton/Gore '96.
Madelon DeVoe Talley, Trustee. 65. Vice Chairman, W.P. Carey & Co. Board
Member and Trustee, Smith Barney Equity Funds, Income Funds, and Trak Fund.
Director, Global Asset Management Funds, Inc., Alliance Capital Management L.P.,
Biocraft Laboratories, Schroder Asian Growth Fund, Inc., and Laidlaw Covenant
Fund. Marketing consultant, Three Cities Research. Commissioner, The Port
Authority of New York and New Jersey.
Ashbel C. Williams, Jr., President of the Trust. 42. President, Schroder
Capital Management Inc. Formerly, Executive Director, Florida State Board of
Administration.
Robert Jackowitz, Treasurer of the Trust. 30. Vice President and
Comptroller, Schroder Capital Management International Inc. Vice President and
Treasurer, Schroder Capital Management Inc. Treasurer and Chief Financial
Officer, Schroder Fund Advisors Inc. Treasurer, Schroder Asian Growth Fund,
Inc., Schroder Capital Funds, Schroder Capital Funds II, and Schroder Capital
Funds (Delaware).
Catherine A. Mazza, Vice President of the Trust. 37. First Vice President,
Schroder Capital Management International Inc. and Schroder Capital Management
Inc. President, Schroder Fund Advisors Inc. Vice President, Schroder Asian
Growth Fund, Inc., Schroder Capital Funds, Schroder Capital Funds II, and
Schroder Capital Funds (Delaware). Previously served as Vice President,
Alliance Capital.
Alexandra Poe, Clerk of the Trust. 37. Senior Vice President, Secretary,
and Fund Counsel, Schroder Fund Advisors Inc. Vice President and Secretary,
Schroder Capital Funds, Schroder Capital Funds II, and Schroder Capital Funds
(Delaware). Assistant Secretary, Schroder Asian Growth Fund,
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Inc. Vice President, Schroder Capital Management International Inc. Formerly,
Senior Associate Attorney, Gordon, Altman, Butowsky, Weitzen, Shalov & Wein;
Vice President and Counsel, Citibank, N.A.
Mark J. Smith, Vice President of the Trust. 36. Director, Schroder
Investment Management Ltd. Director and Senior Vice President, Schroder Capital
Management International Inc. and Schroder Capital Management International Ltd.
Director and Vice President, Schroder Fund Advisors Inc. Trustee and President,
Schroder Capital Funds and Schroder Capital Funds (Delaware). President,
Schroder Capital Funds II. Director, Schroder Investment Management (Guernsey)
Ltd. and Schroder Japanese Warrant Fund Ltd.
Jane E. Lucas, Vice President of the Trust. 35. Director and Senior Vice
President, Schroder Capital Management International Inc. Director, Schroder
Capital Management Inc. Assistant Director, Schroder Investment Management Ltd.
Director, Schroder Fund Advisors Inc. Vice President, Schroder Capital Funds,
Schroder Capital Funds II, and Schroder Capital Funds (Delaware).
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(*) Trustee who is an "interested person" (as defined in the Investment
Company Act of 1940) of the Trust, Schroder, or Schroder Fund Advisors Inc.
Except as otherwise noted, the principal occupations of the Trustees and
officers for the last five years have been with the employers shown above,
although in some cases they have held different positions with such employers or
their affiliates.
Each Trustee of the Trust who is not an interested person of the Trust,
Schroder, or Schroder Fund Advisors Inc. receives an annual fee of $5,000 and an
additional fee for each Trustees' meeting attended. Trustees who are not
interested persons of Schroder and who serve on committees of the Trustees
receive additional fees for attendance at certain committee meetings and for
special services rendered in that connection. The Trust paid Trustees' fees
aggregating $33,000 for the fiscal year ended October 31, 1996. The following
table sets forth information regarding compensation paid for the fiscal year
ended October 31, 1996 to those Trustees who are not interested persons of the
Trust.
COMPENSATION TABLE
(1) (2) (3)
Name of Aggregate Total Compensation
Trustee Compensation from Trust and
from Trust Fund Complex Paid
to Trustees
David N. Dinkins $11,000 $11,000
John I. Howell* 2,750 21,500
Peter S. Knight 11,000 11,000
Michael R. Steed** 5,500 5,500
Madelon DeVoe Talley*** 2,750 15,250
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* Mr. Howell was elected a Trustee on June 25, 1996. The Total Compensation
listed in column (3) for Mr. Howell includes compensation for his services as a
Trustee of Schroder Capital Funds ("SCF") and Schroder Capital Funds (Delaware)
("SCFD") and as a Director of Schroder Asian Growth Fund, Inc. ("SAGF"). The
Trust, SCF, SCFD, and SAGF are considered part of the same "Fund Complex" for
these purposes.
** Mr. Steed resigned from the Board of Trustees as of May 15, 1996.
*** Ms. DeVoe Talley was elected a Trustee on June 25, 1996. The Total
Compensation listed in column (3) for Ms. DeVoe Talley includes compensation for
her services as a Director of SAGF.
As of May 1, 1997, the Trustees of the Trust as a group owned less than 1%
of the outstanding shares of each Fund.
The Agreement and Declaration of Trust of the Trust provides that the Trust
will indemnify its Trustees and officers against liabilities and expenses
incurred in connection with litigation in which they may be involved because of
their offices with the Trust, except if it is determined in the manner specified
in the Agreement and Declaration of Trust that they have not acted in good faith
in the reasonable belief that their actions were in the best interests of the
Trust or that such indemnification would relieve any officer or Trustee of any
liability to the Trust or its Shareholders by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of his or her duties. The Trust,
at its expense, provides liability insurance for the benefit of its Trustees and
officers.
MANAGEMENT CONTRACT
Under a Management Contract between the Trust and Schroder (the "Management
Contract"), Schroder, at its expense, provides the Fund with investment advisory
services and advises and assists the officers of the Trust in taking such steps
as are necessary or appropriate to carry out the decisions of its Trustees
regarding the conduct of business of the Trust and the Fund. The fees to be
paid under the Contract are set forth in the Fund's Prospectus.
In providing investment advisory services to the Fund, Schroder regularly
provides the Fund with investment research, advice, and supervision and
furnishes continuously an investment program consistent with the investment
objectives and policies of the Fund, and determines, for the Fund, what
securities shall be purchased, what securities shall be held or sold, and what
portion of the Fund's assets shall be held uninvested, subject always to the
provisions of the Trust's Agreement and Declaration of Trust and By-laws, and of
the Investment Company Act of 1940, and to the Fund's investment objectives,
policies, and restrictions, and subject further to such policies and
instructions as the Trustees may from time to time establish.
Schroder makes available to the Trust, without expense to the Trust, the
services of such of its directors, officers, and employees as may duly be
elected Trustees or officers of the Trust, subject to their individual consent
to serve and to any limitations imposed by law. Schroder pays the
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compensation and expenses of officers and executive employees of the Trust.
Schroder also provides investment advisory research and statistical facilities
and all clerical services relating to such research, statistical, and investment
work. Schroder pays the Trust's office rent.
Under the Management Contract, the Trust is responsible for all its other
expenses, including clerical salaries not related to investment activities; fees
and expenses incurred in connection with membership in investment company
organizations; brokers' commissions; payment for portfolio pricing services to a
pricing agent, if any; legal expenses; auditing expenses; accounting expenses;
taxes and governmental fees; fees and expenses of the transfer agent and
investor servicing agent of the Trust; the cost of preparing share certificates
or any other expenses, including clerical expenses, incurred in connection with
the issue, sale, underwriting, redemption, or repurchase of shares; the expenses
of and fees for registering or qualifying securities for sale; the fees and
expenses of the Trustees of the Trust who are not affiliated with Schroder; the
cost of preparing and distributing reports and notices to shareholders; public
and investor relations expenses; and fees and disbursements of custodians of the
Fund's assets. The Trust is also responsible for its expenses incurred in
connection with litigation, proceedings, and claims and the legal obligation it
may have to indemnify its officers and Trustees with respect thereto.
State Street Bank and Trust Company ("State Street") provides certain
accounting, transfer agency, and other services to the Fund. The Fund
reimburses State Street on a basis approved by the Trustees.
The Management Contract provides that Schroder shall not be subject to any
liability for any error of judgment or mistake of law or for any loss suffered
by the Fund or the Trust in connection with rendering services to the Fund or
the Trust in the absence of willful misfeasance, bad faith, gross negligence, or
reckless disregard of its duties.
The Management Contract may be terminated without penalty by vote of the
Trustees or the shareholders of the Fund, or by Schroder on 60 days' written
notice. The Management Contract also terminates without payment of any penalty
in the event of its assignment. In addition, the Management Contract may be
amended only by a vote of the shareholders of the Fund, and the Contract
provides that it will continue in effect from year to year only so long as such
continuance is approved at least annually with respect to the Fund by vote of
either the Trustees or the shareholders of the Fund, and, in either case, by a
majority of the Trustees who are not "interested persons" of Schroder. In each
of the foregoing cases, the vote of the shareholders is the affirmative vote of
a "majority of the outstanding voting securities" as defined in the Investment
Company Act of 1940.
Schroder may place portfolio transactions with broker-dealers which
furnish, without cost, certain research, statistical, and quotation services of
value to Schroder and its affiliates in advising the Fund and other clients,
provided that it shall always seek best price and execution with respect to
transactions. Certain investments may be appropriate for the Fund and for other
clients advised by Schroder. Investment decisions for the Fund and other
clients are made with a view to achieving their respective investment objectives
and after consideration of such factors as their current holdings, availability
of cash for investment, and the size of their investments generally.
Frequently, a particular security may be bought or sold for only one client or
in different amounts and at different times for more than one but less than all
clients. Likewise, a particular security may be bought for one or more clients
when one or more other clients are selling the security. In addition, purchases
or
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sales of the same security may be made for two or more clients of Schroder on
the same day. In such event, such transactions will be allocated among the
clients in a manner believed by Schroder to be equitable to each. In some
cases, this procedure could have an adverse effect on the price or amount of the
securities purchased or sold by the Fund. Purchase and sale orders for the Fund
may be combined with those of other clients of Schroder in the interest of
achieving the most favorable net results for the Fund and the Trust.
BROKERAGE AND RESEARCH SERVICES. Transactions on U.S. stock exchanges and
other agency transactions involve the payment by the Fund of negotiated
brokerage commissions. Such commissions vary among different brokers. Also, a
particular broker may charge different commissions according to such factors as
the difficulty and size of the transaction. Transactions in foreign securities
often involve the payment of fixed brokerage commissions, which are generally
higher than those in the United States. There is generally no stated commission
in the case of securities traded in the over-the-counter markets, but the price
paid by the Fund usually includes an undisclosed dealer commission or mark-up.
In underwritten offerings, the price paid by the Fund includes a disclosed,
fixed commission or discount retained by the underwriter or dealer.
Schroder places all orders for the purchase and sale of portfolio
securities for the Fund and buys and sells securities for the Fund through a
substantial number of brokers and dealers. In so doing, it uses its best
efforts to obtain for the Fund the best price and execution available. In
seeking the best price and execution, Schroder, having in mind the Fund's best
interests, considers all factors it deems relevant, including, by way of
illustration, price, the size of the transaction, the nature of the market for
the security, the amount of the commission, the timing of the transaction taking
into account market prices and trends, the reputation, experience, and financial
stability of the broker-dealer involved, and the quality of service rendered by
the broker-dealer in other transactions.
It has for many years been a common practice in the investment advisory
business for advisers of investment companies and other institutional investors
to receive research, statistical, and quotation services from broker-dealers
which execute portfolio transactions for the clients of such advisers.
Consistent with this practice, Schroder receives research, statistical, and
quotation services from many broker-dealers with which it places the Fund's
portfolio transactions. These services, which in some cases may also be
purchased for cash, include such matters as general economic and security market
reviews, industry and company reviews, evaluations of securities, and
recommendations as to the purchase and sale of securities. Some of these
services are of value to Schroder and its affiliates in advising various of
their clients (including the Trust), although not all of these services are
necessarily useful and of value in managing the Trust. The management fee paid
by the Fund is not reduced because Schroder and its affiliates receive such
services.
As permitted by Section 28(e) of the Securities Exchange Act of 1934, and
by the Management Contract, Schroder may cause the Fund to pay a broker which
provides brokerage and research services to Schroder an amount of disclosed
commission for effecting a securities transaction for the Fund in excess of the
commission which another broker would have charged for effecting that
transaction. Schroder's authority to cause the Fund to pay any such greater
commissions is also subject to such policies as the Trustees may adopt from time
to time.
To the extent permitted by law, the Fund may engage in brokerage
transactions with Schroder Wertheim & Co. Incorporated ("Wertheim") or Lewco
Securities, Inc. ("Lewco"), each of which is
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an affiliate of Schroder, or with unaffiliated brokers who trade or clear
through Wertheim or Lewco. (The Investment Company Act of 1940 generally
prohibits the Fund from engaging in securities transactions with Wertheim and
Lewco or their affiliates, as principal, unless pursuant to an exemptive order
from the Securities and Exchange Commission.) Consistent with regulations
under the Investment Company Act of 1940, the Trust has adopted procedures which
are reasonably designed to provide that any commissions or other remuneration
the Fund pays to Wertheim and Lewco do not exceed the usual and customary
broker's commission. In addition, the Fund will adhere to the rule, under the
Securities Exchange Act of 1934, governing floor trading. This rule permits the
Fund to effect, but not execute, exchange listed securities transactions with
Wertheim and Lewco. Also, due to securities law limitations, the Fund will
limit purchases of securities in a public offering if Wertheim or Lewco or one
of their affiliates is a member of the syndicate for that offering.
DETERMINATION OF NET ASSET VALUE
The net asset value per share of the Fund is determined daily as of
4:00 p.m. New York time on each day the New York Stock Exchange is open for
trading. The New York Stock Exchange is normally closed on the following
national holidays: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving, and Christmas.
Securities traded on a national securities exchange or quoted on the NASDAQ
National Market System are valued at their last-reported sale price on the
principal exchange or reported by NASDAQ or, if there is no reported sale, and
in the case of over-the-counter securities not included in the NASDAQ National
Market System, at a bid price estimated by a broker or dealer. Debt securities
will be valued by a pricing service. Securities for which current market
quotations are not readily available and all other assets are valued at fair
value as determined by Schroder in good faith in accordance with procedures
approved by the Trustees.
If any securities held by the Fund are restricted as to resale, their fair
value is generally determined as the amount which the Fund could reasonably
expect to realize from an orderly disposition of such securities over a
reasonable period of time. The valuation procedures applied in
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any specific instance are likely to vary from case to case. However,
consideration is generally given to the financial position of the issuer and
other fundamental analytical data relating to the investment and to the nature
of the restrictions on disposition of the securities (including any registration
expenses that might be borne by the Fund in connection with such disposition).
In addition, specific factors are also generally considered, such as the cost of
the investment, the market value of any unrestricted securities of the same
class (both at the time of purchase and at the time of valuation), the
size of the holding, the prices of any recent transactions or offers with
respect to such securities, and any available analysts' reports regarding the
issuer.
Generally, trading in certain securities is substantially completed each
day at various times prior to the close of the New York Stock Exchange. The
values of these securities used in determining the net asset value of the Fund's
shares are computed as of such times. Also, because of the amount of time
required to collect and process trading information as to large numbers of
securities issues, the values of certain securities (such as convertible bonds
and U.S. Government Securities) are determined based on market quotations
collected earlier in the day at the latest practicable time prior to the close
of the Exchange. Occasionally, events affecting the value of such securities
may occur between such times and the close of the Exchange which will not be
reflected in the computation of the Fund's net asset value. If events
materially affecting the value of such securities occur during such period, then
these securities will be valued at their fair value, in the manner described
above.
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The proceeds received by the Fund for each issue or sale of its shares, and
all income, earnings, profits, and proceeds thereof, subject only to the rights
of creditors, will be specifically allocated to the Fund, and constitute the
underlying assets of the Fund. The underlying assets of the Fund will be
segregated on the Trust's books of account, and will be charged with the
liabilities in respect of the Fund and with a share of the general liabilities
of the Trust. Expenses with respect to any two or more series of the Trust may
be allocated in proportion to the net asset values of the respective series
except where allocations of direct expenses can otherwise be fairly made to a
specific series.
TAXES
The Fund intends to qualify each year and elect to be taxed as a regulated
investment company under Subchapter M of the United States Internal Revenue Code
of 1986, as amended (the "Code").
As a regulated investment company qualifying to have its tax liability
determined under Subchapter M, the Fund will not be subject to federal income
tax on any of its net investment income or net realized capital gains that are
distributed to the separate accounts of any Participating Insurance Company
which holds its shares. As a Massachusetts business trust, the Fund under
present law will not be subject to any excise or income taxes in Massachusetts.
In order to qualify as a "regulated investment company," the Fund must,
among other things, (a) derive at least 90% of its gross income from dividends,
interest, payments with respect to securities loans, gains from the sale or
other dispositions of stock, securities, or foreign currencies,
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and other income (including gains from options, futures, or forward contracts)
derived with respect to its business of investing in such stock, securities, or
currencies; (b) derive less than 30% of its gross income from the sale or other
disposition of certain assets (including stock and securities) held less than
three months; (c) diversify its holdings so that, at the close of each quarter
of its taxable year, (i) at least 50% of the value of its total assets consists
of cash, cash items, U.S. Government Securities, and other securities limited
generally with respect to any one issuer to not more than 5% of the total assets
of the Fund and not more than 10% of the outstanding voting securities of such
issuer, and (ii) not more than 25% of the value of its assets is invested in the
securities of any issuer (other than U.S. Government Securities). In order to
receive the favorable tax treatment accorded regulated investment companies and
their shareholders, moreover, the Fund must in general distribute at least 90%
of its interest, dividends, net short-term capital gain, and certain other
income each year.
It is the policy of the Fund to meet the requirements of the Code to
qualify as a regulated investment company that is taxed pursuant to Subchapter M
of the Code. One of these requirements is that less than 30% of the Fund's
gross income must be derived from gains from sale or other disposition of
securities held for less than three months (with special rules applying to
so-called designated hedges). Accordingly, the Fund will be restricted in
selling securities held or considered under Code rules to have been held less
than three months, and in engaging in other activities which may cause the
Fund's holding period in certain of its assets to be less than three months.
This discussion of the federal income tax and state tax treatment of the
Fund and its shareholders is based on the law as of the date of this Statement
of Additional Information.
PERFORMANCE INFORMATION
Average annual total return of the Fund for one-, five-, and ten-year
periods (or for such shorter periods as shares of the Fund have been offered) is
determined by calculating the actual dollar amount of investment return on a
$1,000 investment in the Fund at the beginning of the period, and then
calculating the annual compounded rate of return which would produce that
amount. Total return for a period of one year or less is equal to the actual
return of the Fund during that period. Total return calculations assume
reinvestment of the Fund's distributions at net asset value on their respective
reinvestment dates. Total return may be presented for other periods.
From time to time, Schroder may reduce its compensation or assume expenses
of the Fund in order to reduce the Fund's expenses, as described in the Fund's
Prospectuses. Any such waiver or assumption would increase the Fund's total
return during the period of the waiver or assumption.
ORGANIZATION AND CAPITALIZATION
The Trust is an open-end investment company established under the laws of
The Commonwealth of Massachusetts by an Agreement and Declaration of Trust dated
May 6, 1993. The Fund is one of six series of shares of the Trust.
Shares of the Trust entitle their holders to one vote per share, with
fractional shares voting proportionally; however, a separate vote will be taken
by the Fund on matters affecting the Fund. For example, a change in a
fundamental investment policy for the Fund would be voted upon only by
shareholders of the Fund. Additionally, approval of the Management Contract is
a matter to be
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determined separately by the Fund. Shares have noncumulative voting rights.
Although the Trust is not required to hold annual meetings of its shareholders,
shareholders have the right to call a meeting to elect or remove Trustees or to
take other actions as provided in the Declaration of Trust. Shares have no
preemptive or subscription rights, and are transferable. Shares are entitled to
dividends as declared by the Trustees, and if the Fund were liquidated, the
shares of the Fund would receive the net assets of the Fund. The Trust may
suspend the sale of Fund shares at any time and may refuse any order to purchase
Fund shares.
The Trust may create additional Funds from time to time with different
investment objectives and policies. The Fund may offer additional classes of
shares subject to different expenses and other features.
PRINCIPAL UNDERWRITER
Schroder Fund Advisors Inc. is the principal underwriter of the continually
offered shares of the Fund. Schroder Fund Advisors Inc. is not obligated to
sell any specific amount of shares of the Fund and will purchase shares of the
Fund for resale only against orders for shares.
CUSTODIAN
State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110 is the custodian of the Fund's assets. The custodian's
responsibilities include safeguarding and controlling the Fund's cash and
securities, handling the receipt and delivery of securities, and collecting
interest and dividends on the Fund's investments. The custodian does not
determine the investment policies of the Fund or decide which securities the
Fund will buy or sell. Boston Financial Data Services, Inc., Two Heritage
Drive, North Quincy, Massachusetts 02171, serves as registrar and transfer agent
for the Fund.
INDEPENDENT AUDITORS
Arthur Andersen LLP, independent accountants, provide audit services, tax
return preparation services, and assistance and consultation in connection with
the Fund's and the Trust's various Securities and Exchange Commission filings.
SHAREHOLDER LIABILITY
Under Massachusetts law, shareholders could, under certain circumstances,
be held personally liable for the obligations of the Trust. However, the
Agreement and Declaration of Trust disclaims shareholder liability for acts or
obligations of the Trust and requires that notice of such disclaimer be given in
each agreement, obligation, or instrument entered into or executed by the Trust
or the Trustees. The Agreement and Declaration of Trust provides for
indemnification out of the Fund's property for all loss and expense of any
shareholder held personally liable for the obligations of the Fund. Thus the
risk of a shareholder's incurring financial loss on account of shareholder
liability is limited to circumstances in which the Fund would be unable to meet
its obligations.
-12-
<PAGE>
OTHER INFORMATION
The Prospectus and this Statement, together, do not contain all of the
information set forth in the Registration Statement of Schroder Series Trust, as
amended, filed with the Securities and Exchange Commission. Certain information
is omitted in accordance with rules and regulations of the Commission. The
Registration Statement may be inspected at the Public Reference Room of the
Commission at Room 1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549, and copies thereof may be obtained from the Commission at
prescribed rates.
-13-
<PAGE>
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements Included in Parts A and B (with respect to all
series of the Trust except the Schroder Mid-Cap Value Fund):
(1) Report of Independent Auditors*
(2) Statement of assets and liabilities, October 31, 1996. Statement
of Operations -- period ended October 31, 1996. Statement of
Change in net assets -- period ended October 31, 1996. Financial
Highlights -- period ended October 31, 1996. Notes to Financial
Statements.*
Included in Part C: None.
_____________
* Previously filed
(b) Exhibits
(1) - Agreement and Declaration of Trust*
(2) - Bylaws*
(3) - Inapplicable
(4)(A) - Forms of certificate representing shares of beneficial
interest*
(B) - Portions of Agreement and Declaration of Trust Relating
to Shareholders' Rights*
(C) - Portions of Bylaws Relating to Shareholders' Rights*
(5)(A) - Form of Management Contract*
(B) - Form of Management Contract for Mid-Cap Value Fund
(6)(A) - Form of Distributor's Contract*
(7) - Inapplicable
(8) - Form of Custodian Agreement*
(9)(A) - Form of Transfer Agent and Servicing Agreement*
(B) - Form of Administration Agreement*
(C) - Form of Shareholder Service Agreement for Advisor
Shares*
(D) - Form of Shareholder Servicing Plan for Advisor Shares*
(10) - Opinion and Consent of Ropes & Gray*
(11) - Consent of Independent Public Accountants*
(12) - Inapplicable
(13) - Form of Initial Capital Agreement*
(14) - Inapplicable
(15) - Form of Distribution Plan and Agreement for Advisor
Shares*
(16) - Schedule for Computation of Performance Information*
(17) - Financial Data Schedule*
(18) - Multiclass (Rule 18f-3) Plan*
(19)(A) - Powers of Attorney for Messrs. Knight, Dinkins, and
Steed*
(B) - Powers of Attorney for Messrs. Gibson, Knight,
Dinkins, Howell, Williams, and Jackowitz, and Ms.
DeVoe Talley*
<PAGE>
- ------------------------
* Previously filed.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
The Schroder Wertheim & Co. Incorporated Profit-Sharing and Savings
Incentive Plans and the Lewco Securities Corp. Profit Sharing and Thrift Plans,
and the Schroder Wertheim & Co. Pension Plan may be deemed to "control" certain
of the Funds. See "Principal Holders of Securities" in the Statement of
Additional Information.
ITEM 26. NUMBER OF RECORD HOLDERS OF SECURITIES
As of March 31, 1997, the number of shareholders of record of each Fund
with shares outstanding was as follows:
Fund # record shareholders
- ---- ---------------------
Schroder Equity Value Fund 628
Schroder Small Capitalization
Value Fund 729
Schroder Investment Grade
Income Fund 298
Schroder High Yield Income Fund 358
Schroder Short-Term Investment Fund 393
ITEM 27. INDEMNIFICATION
Article VIII of the Registrant's Agreement and Declaration of Trust
provides as follows:
SECTION 1. The Trust shall indemnify each of its Trustees and officers
(including persons who serve at the Trust's request as directors, officers or
trustees of another organization in which the Trust has any interest as a
shareholder, creditor or otherwise) (hereinafter referred to as a "Covered
Person") against all liabilities and expenses, including but not limited to
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees reasonably incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such Covered Person may be or may have
been threatened, while in office or thereafter, by reason of being or having
been such a Covered Person except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in any such action, suit or
other proceeding (a) not to have acted in good faith in the reasonable belief
that such Covered Person's action was in the best interests of the Trust or (b)
to be liable to the Trust or its Shareholders by reason of willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office. Expenses, including counsel fees so
incurred by any such Covered Person (but
-2-
<PAGE>
excluding amounts paid in satisfaction of judgments, in compromise or as fines
or penalties), shall be paid from time to time by the Trust in advance of the
final disposition of any such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Covered Person to repay amounts so paid to
the Trust if it is ultimately determined that indemnification of such expenses
is not authorized under this Article, provided, however, that either (a) such
Covered Person shall have provided appropriate security for such undertaking,
(b) the Trust shall be insured against losses arising from any such advance
payments or (c) either a majority of the disinterested Trustees acting on the
matter (provided that a majority of the uninterested Trustees then in office act
on the matter), or independent legal counsel in a written opinion, shall have
determined, based upon a review of readily available facts (as opposed to a full
trial type inquiry), that there is reason to believe that such Covered Person
will be found entitled to indemnification under this Article.
SECTION 2. As to any matter disposed of (whether by a compromise payment,
pursuant to a consent decree or otherwise) without an adjudication by a court,
or by any other body before which the proceeding was brought, that such Covered
Person either (a) did not act in good faith in the reasonable belief that his or
her action was in the best interests of the Trust or (b) is liable to the Trust
or its Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his or
her office, indemnification shall be provided if (a) approved as in the best
interests of the Trust, after notice that it involves such indemnification, by
at least a majority of the disinterested Trustees acting on the matter (provided
that a majority of the disinterested Trustees then in office act on the matter)
upon a determination, based upon a review of readily available facts (as opposed
to a full trial type inquiry) that such Covered Person acted in good faith in
the reasonable belief that his or her action was in the best interests of the
Trust and is not liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his or her office, or (b) there has been obtained an
opinion in writing of independent legal counsel, based upon a review of readily
available facts (as opposed to a full trial type inquiry), to the effect that
such Covered Person appears to have acted in good faith in the reasonable belief
that his or her action was in the best interests of the Trust and that such
indemnification would not protect such Covered Person against any liability to
the Trust to which he or she 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 or her office. Any approval pursuant to this
Section shall not prevent the recovery from any Covered Person of any amount
paid to such Covered Person in accordance with this Section as indemnification
if such Covered Person is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief that such
Covered Person's action was in the best interests of the Trust or to have been
liable to the Trust or its Shareholders by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office.
SECTION 3. The right of indemnification hereby provided shall not be
exclusive of or affect any other rights to which such Covered Person may be
entitled. As used in this Article VIII, the term "Covered Person" shall include
such person's heirs, executors and administrators, and a "disinterested Trustee"
is a Trustee who is not an "interested person" of the Trust as defined in
Section 2(a)(19) of the 1940 Act (or who has been exempted from being an
"interested person" by any rule, regulation or order of the Securities and
Exchange Commission) and against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or has been pending. Nothing contained in this Article shall
affect any rights to indemnification to which personnel of the Trust, other than
Trustees or officers, and other persons may be entitled by contract or otherwise
under law, nor the power of the Trust to purchase and maintain liability
insurance on behalf of any such person.
-3-
<PAGE>
-------------------------
Reference is made to the Distributor's Contract, previously filed, which
contains provisions for the indemnification by Schroder Fund Advisors Inc. of
the Registrant and Trustees and officers of the Registrant under certain
circumstances. Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to Trustees and officers of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a Trustee or officer of the Registrant in the successful defense of
any action, suit, or proceeding) is asserted by such Trustee or officer in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
The directors and officers of the Registrant's investment adviser have been
engaged during the past two fiscal years in no business, vocation, or employment
of a substantial nature other than as directors, officers, or employees of the
investment adviser or certain of its corporate affiliates, except the following,
whose principal occupations during that period, other than as directors or
officers of the investment adviser or certain of its corporate affiliates, are
as follows: Ashbel C. Williams, Jr., President and Director, who was Executive
Director, Florida State Board of Administration; Paul M. Morris, Director, who
was Principal and Senior Portfolio Manager at Weiss Peck & Greer, L.L.C.; Connie
Moak-Mazur, Group Vice President, who was Managing Director/Marketing and Client
Service, Wasserstein Perella Asset Management; Locke W. Ogens, First Vice
President, who was Vice President and Portfolio Manager, Greenville Capital
Management; Cheryl Cohen, Vice President, who was Vice President, Goldman Sachs
& Co.; James Gray, Vice President, who was First Vice President, Concord Holding
Corporation; and Anita L. Whelan, Vice President/Compliance Officer, who was
First Vice President and Director of Compliance, Prudential Securities
Incorporated Asset Management Group. The address of the investment adviser and
its corporate affiliates is 787 Seventh Avenue, New York, New York 10019.
-4-
<PAGE>
ITEM 29. PRINCIPAL UNDERWRITERS
(a) Schroder Fund Advisors Inc. currently acts as the principal underwriter
for Schroder Capital Funds (Delaware), the series of which are Schroder U.S.
Equity Fund, Schroder Emerging Markets Fund Institutional Portfolio, Schroder
U.S. Smaller Companies Fund, Schroder International Fund, Schroder International
Smaller Companies Fund, and Schroder International Bond Portfolio.
(b) The directors and officers of the Registrant's principal underwriter
are:
<TABLE>
<CAPTION>
Positions and Offices with Positions and Offices with
Name Registrant Underwriter
- ---- -------------------------- --------------------------
<S> <C> <C>
Kathleen Adams None Vice President
John Burns None Vice President
Barbara Gottlieb Assistant Clerk Assistant Vice President
James L. Gray None Senior Vice President
Lynne D. Gravelle None Assistant Vice President
Fredrica G. Grizzel None Assistant Vice President
Sharon L. Haugh None Director; Chairman
Robert Jackowitz Treasurer Treasurer; Chief Financial
Officer
Sean P. Keegan None Assistant Vice President
Mary Kunkemueller None Assistant Vice President
Jane E. Lucas Vice President Director
Catherine A. Mazza Vice President President
Alexandra Poe Clerk Fund Counsel; Senior Vice
President; Secretary
Mark J. Smith Vice President Director; Vice President
M. Randall Strickland None Vice President
Anita L. Whelan None Vice President
</TABLE>
-5-
<PAGE>
The principal business address of each person listed above is 787 Seventh
Avenue, New York, New York 10019.
(c) Inapplicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
Persons maintaining physical possession of accounts, books, and other
documents required to be maintained by Section 31(a) of the Investment Company
Act of 1940 and the Rules promulgated thereunder are Registrant's Clerk,
Alexandra Poe; Registrant's investment adviser, Schroder Capital Management
Inc.; Registrant's custodian, State Street Bank & Trust Company; and
Registrant's transfer agent and registrar, Boston Financial Data Services, Inc.
The address of the Clerk and investment adviser is Equitable Center, 787 Seventh
Avenue, New York, New York 10019. The address of the custodian is 225 Franklin
Street, Boston, Massachusetts 02110. The address of the transfer agent and
registrar is Two Heritage Drive, Quincy, Massachusetts, 02171.
ITEM 31. MANAGEMENT SERVICES
None.
ITEM 32. UNDERTAKINGS
(a) Inapplicable.
(b) The Registrant undertakes to file a post-effective amendment
containing financial statements (that need not be certified) as to
Schroder Mid-Cap Value Fund within four to six months following the
effective date of this Amendment.
(c) The Registrant undertakes to furnish each person to whom a prospectus
is delivered with a copy of the Registrant's latest annual report to
shareholders upon request and without charge.
(d) The Registrant undertakes, if requested to do so by the holders of at
least 10% of the Registrant's outstanding shares of beneficial
interest, to call a meeting of shareholders for the purpose of voting
upon the question of removal of a Trustee or Trustees and to assist in
communications with other shareholders as required by Section 16(c) of
the Investment Company Act of 1940.
NOTICE
A copy of the Agreement and Declaration of Trust of Schroder Series Trust
is on file with the Secretary of State of The Commonwealth of Massachusetts, and
notice is hereby given that this instrument is executed on behalf of the
Registrant by an officer of the Registrant as an officer and not individually
and that the obligations of or arising out of this instrument are not binding
upon any of the Trustees, officers, or shareholders individually but are binding
only upon the assets and property of the Registrant.
-6-
<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 Registration
Statement to be signed on its behalf by the undersigned, thereto duly
authorized, in the City of New York and the State of New York, on this 8th day
of May, 1997.
SCHRODER SERIES TRUST
By: /S/ Catherine A. Mazza
----------------------------
Name: Catherine A. Mazza
Title: Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on the 8th day of May, 1997.
SIGNATURE TITLE
--------- -----
* President of the Trust
- -------------------------
Ashbel C. Williams, Jr.
* Treasurer; Principal Financial
- ------------------------- Officer; Principal Accounting
Robert Jackowitz Officer
*
- ------------------------- Trustee
David N. Dinkins
* Trustee
- -------------------------
David Gibson
* Trustee
- -------------------------
John I. Howell
* Trustee
- -------------------------
Peter S. Knight
* Trustee
- -------------------------
Madelon DeVoe Talley
* By: /S/ Catherine A. Mazza
-------------------------
Catherine A. Mazza
Attorney-In-Fact
-7-
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. TITLE PAGE
- ----------- ----- -----
5(B) Form of Management Contract for Mid-Cap Value Fund
-8-
<PAGE>
<PAGE>
SCHRODER SERIES TRUST
MANAGEMENT CONTRACT
This Management Contract dated as of ____________, 1997 between SCHRODER
SERIES TRUST, a Massachusetts business trust (the "Trust"), on behalf of its
Mid-Cap Value Fund (the "Fund"), and SCHRODER CAPITAL MANAGEMENT INC., a
Delaware corporation (the "Manager").
WITNESSETH:
That in consideration of the mutual covenants herein contained, it is
agreed as follows:
1. SERVICES TO BE RENDERED BY THE MANAGER TO THE FUND.
(a) The Manager, at its expense will furnish continuously an investment
program for the Fund, will determine what investments shall be purchased, held,
sold, or exchange by the Fund and what portion, if any, of the assets of the
Fund shall be held uninvested and shall, on behalf of the Fund, make changes in
the Fund's investments. In the performance of its duties, the Manager will
comply with the provisions of the Agreement and Declaration of Trust and Bylaws
of the Trust and the Fund's stated investment objectives, policies, and
restrictions, and will use its best efforts to safeguard and promote the welfare
of the Fund and to comply with other policies which the Trustees may from time
to time determine and shall exercise the same care and diligence expected of the
Trustees.
(b) The Manager, at its expense, except as such expense is paid by the
Fund as provided in Section 1(d), will furnish all necessary investment and
related management facilities, including salaries of personnel, required for it
to execute its duties faithfully. The Manager will pay the compensation, if
any, of certain officers of the Trust carrying out the investment management and
related duties provided for by this Contract.
(c) The Manager, at its expense, shall place all orders for the purchase
and sale of portfolio investments for the Fund's account with brokers or dealers
selected by the Manager. In the selection of such brokers or dealers and the
placing of such orders, the Manager shall use its best efforts to obtain for the
Fund the most favorable price and execution available, except to the extent it
may be permitted to pay higher brokerage commissions for brokerage and research
services as described below. In using its best efforts to obtain for the Fund
the most favorable price and execution available, the Manager, bearing in mind
the Fund's best interests at all times, shall consider all factors it deems
relevant, including, by way of illustration, price, the size of the transaction,
the nature of the market for the security, the amount of the commission, the
timing of the transaction taking into account market prices and trends, the
reputation, experience, and financial stability of the broker or dealer
involved, and
<PAGE>
the quality of service rendered by the broker or dealer in other transactions.
Subject to such policies as the Trustees of the Trust may determine, the Manager
shall not be deemed to have acted unlawfully or to have breached any duty
created by this Contract or otherwise solely by reason of its having caused the
Fund to pay a broker or dealer that provides brokerage and research services to
the Manager an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission that another broker or dealer
would have charged for effecting that transaction, if the Manager determines in
good faith that such amount of commission was reasonable in relation to the
value of the brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the Manager's overall
responsibilities with respect to the Fund and to other clients of the Manager as
to which the Manager exercises investment discretion. The Trust hereby agrees
with the Manager that any entity or person associated with the Manger which is a
member of a national securities exchange is authorized to effect any transaction
on such exchange for the account of the Trust and any Fund thereof which is
permitted by Section 11(a) of the Securities Exchange Act of 1934.
(d) The Manager shall not be obligated to pay any expenses of or for the
Fund or the Trust not expressly assumed by the Manager pursuant to this Section
1 other than as provided in Section 3.
2. OTHER AGREEMENTS, ETC.
It is understood that any of the shareholders, Trustees, officers, and
employees of the Trust may be a shareholder, director, officer, or employee of,
or be otherwise interested in, the Manager, and in any person controlled by or
under common control with the Manager, and that the Manager and any person
controlled by or under common contract with the Manager may have an interest in
the Trust. It is also understood that the Manager and any person controlled by
or under common control with the Manager have and may have advisory, management,
service, or other contracts with other organizations and persons, and may have
other interests and business.
3. COMPENSATION TO BE PAID BY THE FUND TO THE MANAGER.
The Fund will pay to the Manager as compensation for the Manager's services
rendered, for the facilities furnished and for the expenses borne by the Manager
pursuant to Section 1, fees in respect of the Fund, computed and paid quarterly
at the annual rate of [0.95]% of the average net asset value of the Fund.
Such average net asset value shall be determined by taking an average of
all of the determinations of such net asset value during such quarter at the
close of business on each business day during such quarter which this Contract
is in effect. Such fees shall be payable for each fiscal quarter within 30 days
after the close of such quarter and shall commence accruing as of the date of
the initial issuance of shares of the Fund to the public.
-2-
<PAGE>
In the event that expenses of the Fund for any fiscal year should exceed
the expense limitation on investment company expenses imposed by any statute or
regulatory authority of any jurisdiction in which shares of the Fund are
qualified for offer or sale, the compensation due the Manager for such fiscal
year shall be reduced by the amount of such excess by a reduction or refund
thereof. In the event that the expenses of the Fund exceed any expense
limitation which the Manager may, by written notice to the Trust, voluntarily
declare to be effective subject to such terms and conditions as the Manager may
prescribe in such notice, the compensation due the Manager shall be reduced,
and, if necessary, the Manager shall assume expenses of the Fund, to the extent
required by such expense limitation.
If the Manager shall serve for less than the whole of a quarter, the
foregoing compensation shall be prorated.
4. ASSIGNMENT TERMINATES THIS CONTRACT; AMENDMENTS OF THIS CONTRACT.
This Contract shall automatically terminate, without the payment of any
penalty, in the event of its assignment; and this Contract shall not be amended
unless such amendment be approved at a meeting by the affirmative vote of a
majority of the outstanding shares of the Fund, and by the vote, cast in person
at a meeting called for the purpose of voting on such approval, of a majority of
the Trustees of the Trust who are not interested persons of the Trust or of the
Manager.
5. EFFECTIVE PERIOD AND TERMINATION OF THIS CONTRACT.
This Contract shall become effective upon its execution and shall remain in
full force and effect continuously thereafter (unless terminated automatically
as set forth in Section 4) until terminated as follows:
(a) Either party hereto may at any time terminate this Contract by not
more than sixty days nor less than thirty days written notice delivered or
mailed by registered mail, postage prepaid, to the other party, or
(b) If (i) the Trustees of the Trust or the shareholders by the
affirmative vote of a majority of the outstanding shares of the Fund and (ii) a
majority of the Trustees of the Trust who are not interested persons of the
Trust or of the Manager, by vote cast in person at a meeting called for the
purpose of voting on such approval, do not specifically approve at least
annually the continuance of this Contract, then this Contract shall
automatically terminate at the close of business on ___________, 1999 or the
expiration of one year from the effective date of the last such continuance,
whichever is later.
Action by the Trust under (a) above may be taken either (i) by vote of a
majority of its Trustees, or (ii) by the affirmative vote of a majority of the
outstanding shares of the Fund.
-3-
<PAGE>
Termination of this Contract pursuant to this Section 5 will be without the
payment of any penalty.
6. CERTAIN DEFINITIONS.
For the purposes of this Contract, the "affirmative vote of a majority of
the outstanding shares" of the Fund means the affirmative vote, at a duly called
and held meeting of such shareholders, (a) of the holders of 67% or more of the
shares of the Fund present (in person or by proxy) and entitled to vote at such
meeting, if the holders of more than 50% of the outstanding shares of the Fund
entitled to vote at such meeting are present in person or by proxy, or (b) of
the holders of more than 50% of the outstanding shares of the Fund entitled to
vote at such meeting, whichever is less.
For the purposes of this Contract, the terms "affiliated person",
"control", "interested person", and "assignment" shall have their respective
meanings defined in the Investment Company Act of 1940, as amended, and the
Rules and Regulations thereunder, subject, however, to such exemptions as may be
granted by the Securities and Exchange Commission under said Act; the term
"specifically approve at least annually" shall be construed in a manner
consistent with the Investment Company Act of 1940, as amended, and the Rules
and Regulations thereunder; and the term "brokerage and research services" shall
have the meaning given in the Securities Exchange Act of 1934, as amended, and
the Rules and Regulations thereunder.
7. NON-LIABILITY OF MANAGER.
In the absence of willful misfeasance, bad faith, or gross negligence on
the part of the Manager, or reckless disregard of its obligations and duties
hereunder, the Manager shall not be subject to any liability to the Fund or the
Trust or to any shareholder of the Fund or the Trust for any act or omission in
the course of, or connected with, rendering services hereunder.
8. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS.
A copy of the Agreement and Declaration of Trust of the Trust is on file
with the Secretary of State of The Commonwealth of Massachusetts, and notice is
hereby given that this instrument is executed on behalf of the Trustees of the
Trust as Trustees and not individually and that the obligations of this
instrument are not binding upon any of the Trustees, officers, or shareholders
of the Trust but are binding only upon the assets and property of the Trust.
-4-
<PAGE>
IN WITNESS WHEREOF, SCHRODER SERIES TRUST and SCHRODER CAPITAL MANAGEMENT
INC. have each caused this instrument to be signed in duplicate in its behalf by
its President or Vice President thereunto duly authorized, all as of the day and
year first above written.
SCHRODER SERIES TRUST
By:________________________________
SCHRODER CAPITAL MANAGEMENT INC.
By:________________________________
