<PAGE>
As filed with the Securities and Exchange Commission
On February 26, 1999
1933 Act Registration Number 33-66714
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1940 Act Registration Number 811-7918
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 6
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 7
Weitz Partners, Inc.
______________________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Suite 600
1125 South 103 Street
Omaha, NE 68124-6008
(Address of Principal Office)
Registrant's Telephone Number, including Area Code:
402-391-1980
Wallace R. Weitz
Suite 600
1125 South 103 Street
Omaha, NE 68124-6008
______________________________________________________________________
(Name and Address of Agent for Service)
Copies of all communications to:
PATRICK W.D. TURLEY, ESQ.
Dechert Price & Rhoads
1775 Eye Street
Washington, DC 10007
It is proposed that this filing will become effective 60 days after filing
pursuant to paragraph (a)(1) of Rule 485
<PAGE>
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Additional Information Is Available
The Statement of Additional Information (SAI) provides more detailed information
about the Fund and its policies. The SAI, which has been filed with the
Securities and Exchange Commission is incorporated by reference. Additional
information about the Fund's investments is available in the Fund's Annual,
Semiannual and Quarterly Reports. In the Fund's Annual Report you will find a
discussion of the market conditions and investment strategies that significantly
affected the Fund's performance during its last fiscal year. The SAI and reports
are available without charge, upon request.
You may request information or make inquiries about the Fund as follows:
- - By telephone:
Call 1-800-232-4161
- - By mail:
Weitz Funds
One Pacific Place, Suite 600
1125 South 103rd Street
Omaha, Nebraska 68124-6008
- - On the Internet:
Weitz Funds
http://www.weitzfunds.com
SEC
http://www.sec.gov
Information about the Fund (including the SAI) can be reviewed and copied at the
SEC's Public Reference Room in Washington, D.C. (1-800-SEC-0330). Copies of such
information can also be obtained by sending your request and a duplicating fee
to the SEC's Public Reference Section, Washington, D.C. 20549-6009.
SEC File Number: 811-7918
WEITZ PARTNERS, INC.
PARTNERS VALUE FUND
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PROSPECTUS
APRIL 30, 1999
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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TABLE OF CONTENTS
<TABLE>
<S> <C>
Investment Objectives, Principal Investment Strategies, Related Risks.............. 2
Investment Objectives/Goals...................................................... 2
Principal Investment Strategies.................................................. 2
Principal Risks.................................................................. 2
Fund Performance................................................................... 4
Fund Expenses...................................................................... 5
Purchasing Shares.................................................................. 6
Opening a Regular New Account.................................................... 6
Opening a Retirement Account..................................................... 6
Purchasing Shares of the Fund.................................................... 6
Purchasing Through Others........................................................ 7
Changing Your Address............................................................ 8
Confirmations and Shareholder Reports............................................ 8
Redeeming Shares................................................................... 9
Redemption Procedures............................................................ 9
Redemption Payments.............................................................. 9
Signature Guarantees............................................................. 9
Other Redemption Information..................................................... 10
Exchanging Shares.................................................................. 11
Pricing of Shares.................................................................. 12
Distributions and Taxes............................................................ 13
Shareholder Distributions........................................................ 13
Taxation of Distributions........................................................ 13
Taxation of Sales and Exchanges.................................................. 13
Buying Shares Prior to a Distribution............................................ 13
Management......................................................................... 14
Investment Adviser............................................................... 14
Portfolio Manager................................................................ 14
Fund Distributor................................................................. 14
Additional Information............................................................. 15
Code of Ethics................................................................... 15
Year 2000........................................................................ 15
Fund Custodian................................................................... 16
Fund Auditor..................................................................... 16
Fund Legal Counsel............................................................... 16
Financial Highlights............................................................... 17
</TABLE>
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-1-
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INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES, RELATED RISKS
INVESTMENT OBJECTIVES/GOALS
The Fund's primary investment objective is capital appreciation. The Fund
seeks to achieve its objective by investing primarily in common stocks and a
variety of securities convertible into common stocks such as rights, warrants,
convertible preferred stock and convertible bonds. The Fund may also invest in
other securities of a company not convertible into common stock, such as bonds
and preferred stock, which Wallace R. Weitz & Company ("Weitz & Co."), the
Fund's investment adviser, determines may offer the opportunity for capital
appreciation. Such securities may be investment grade, non-investment grade or
unrated. The Fund considers long-term capital gains preferable to short-term
capital gains and dividend and interest income, but all such gains and income
are desirable.
PRINCIPAL INVESTMENT STRATEGIES
The Fund's investment strategy (which is called "value investing") is to
invest primarily in the common stocks of sound, growing, well-managed
businesses. In implementing this strategy Weitz & Co. attempts to:
- - Identify attractive businesses that Weitz & Co. understands and which have
honest, competent management;
- - Estimate the price that an informed, rational buyer would pay for 100% of that
business; and then
- - Buy securities of that business if they are available at a significant
discount to this "business value" or "private market value".
At the heart of the calculation of value is an estimate of the value today
of the right to receive all of the cash that a business will generate for its
owners in the future. The valuation may focus on asset values, earning power,
the intangible value of a company's "franchise" in its market or a combination
of these variables, depending on the nature of the business. Weitz & Co. then
tries to buy shares of the company's stock at a significant discount to this
"private market value." Weitz & Co. hopes that the stock price will rise as the
value of the business grows and as the valuation discount narrows. However, even
if the analysis of business value is correct, the stock price may fail to
reflect this value.
Weitz & Co. does not try to "time" the market, but if there is cash
available for investment and there are not stocks which meet the Fund's
investment criteria or if Weitz & Co. determines market conditions warrant, the
Fund will hold cash or invest in high quality fixed income securities for
temporary defensive purposes.
PRINCIPAL RISKS
You should be aware that an investment in the Fund involves certain risks,
including the following:
- - PRICE OF FUND SHARES WILL FLUCTUATE As with any other mutual fund, the share
price of the Fund will fluctuate daily depending on general market conditions
and other factors. YOU MAY LOSE MONEY IF YOU INVEST IN THE FUND.
- - FUND IS NONDIVERSIFIED Because the Fund is nondiversified, it may, with
respect to 50% of its total assets, concentrate its investments by investing
more than 5% of its total assets in the securities of any one issuer. As a
result, its shares may be more susceptible to adverse changes in the value of
the securities of a particular company.
- - INVESTMENT IN UNDER-VALUED SECURITIES Under-valued securities are, by
definition, out of favor with investors, and there is no way to predict when
the securities may return to favor. THEREFORE, INVESTORS SHOULD PURCHASE
SHARES OF THE FUND ONLY IF THEY INTEND TO BE PATIENT LONG-TERM INVESTORS.
- - FAILURE TO MEET INVESTMENT OBJECTIVE There can be no assurance that the Fund
will meet its investment objective.
-2-
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In making investment decisions, Weitz & Co. distinguishes between two types
of risk:
- - Stock Price Volatility; and
- - The Risk of Permanent Loss of Capital.
Academic studies and most financial journals and advisers equate volatility
and risk. They measure the historical volatility of a stock or a fund as a
percentage of the volatility of an index, such as the S&P 500, and calculate a
ratio, called a "beta". A fund with a beta of 0.50 has been 50% as volatile as
the index over the measuring period. A beta of 1.00 indicates the fund and the
index have been equally volatile.
Some of the stocks the Fund will own will be very volatile (high beta).
Furthermore, the Fund has, at times, been relatively concentrated in a few
industries, which means it is likely to exhibit short-term performance that is
very different from the S&P 500. The difference may be positive or negative, but
in either event, the result could be a high portfolio beta. Since the Fund
focuses on long-term total return (income plus capital gains), we are not as
concerned with short-term volatility, or beta.
We ARE concerned with the risk of PERMANENT loss. We believe that by
focusing on the value of the underlying business and being disciplined about
buying stocks only when they appear to be selling below the company's business
value, we enjoy what Benjamin Graham (sometimes known as the father of "value"
investing) called a "margin of safety." The margin of safety reduces, but does
not eliminate, risk. However, we will make mistakes in measuring value, business
values may deteriorate after we buy, and stocks may sell below their business
values indefinitely, so we cannot avoid incurring losses. Also, since our
investment approach leads us to invest in stocks which are not currently
popular, the Fund is subject to extended periods during which its stocks
under-perform others or display volatile price movements.
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FUND PERFORMANCE
The chart and table below provide an indication of the risks of
investing in the Fund by showing changes in the Fund's performance from year to
year over a 10-year period and by showing how the Fund's average annual returns
for one, five and ten years and for the period since inception compare to those
of a broad-based securities market index. The information assumes reinvestment
of dividends and capital gain distributions. The Fund succeeded to substantially
all of the assets of Weitz Partners II, a Nebraska limited partnership as of
December 31, 1993. The Fund's investment objectives and policies are
substantially identical to those of the partnership and Wallace R. Weitz, the
Fund's portfolio manager was also the General Partner and portfolio manager for
the partnership. The partnership was not registered under the Investment Company
Act of 1940 (the "1940 Act") and therefore was not subject to certain investment
restrictions imposed by the 1940 Act. If the partnership had been registered
under the 1940 Act, the performance of the partnership may have been adversely
affected. In considering the information set forth below you should remember
that past performance is not necessarily an indication of how the Fund will
perform in the future.
INVESTMENT RESULTS
The following chart shows performance during each of the last ten calendar
years.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ANNUAL RETURN - LAST 10 CALENDAR YEARS*
<S> <C>
1988 14.90%
1989 20.30%
1990 -6.30%
1991 28.10%
1992 15.10%
1993 23.00%
1994 -9.03%
1995 38.66%
1996 19.15%
1997 40.62%
1998 29.07%
</TABLE>
During the ten year period shown in the chart above, the highest quarterly
return was 16.61% (Quarter ended Mar. 31, 1998) and the lowest quarterly return
was -10.02% (Quarter ended Sep. 30, 1990).
Average Annual Total Returns (for periods ended December 31, 1998)
<TABLE>
<CAPTION>
Since
Inception
1 year 5 year 10 years (June 1, 1983)
--------- ----------- ----------- --------------
<S> <C> <C> <C> <C>
Partners Value Fund* 29.1% 22.2% 18.8% 18.0%
Standard & Poor's 500 Index** 28.6% 24.0% 19.2% 17.4%
</TABLE>
*Includes performance of the Fund's predecessor entity, Weitz Partners II.
**The Standard & Poor's 500 Index is an unmanaged index of 500 companies
generally representative of the market for the stocks of large-size U.S.
companies.
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FUND EXPENSES
The table below describes the fees and expenses that you may pay if you
buy and hold shares of the Fund:
<TABLE>
<S> <C>
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
Maximum Sales Charge (Load) Imposed on Purchases None
Maximum Deferred Sales Charge (Load) None
Maximum Sales Charge (Load) Imposed on Reinvested
Dividends None
Redemption Fee None
Exchange Fee None
ANNUAL FUND OPERATING EXPENSES (EXPENSES THAT ARE DEDUCTED FROM FUND
ASSETS)
Management Fees 1.00%
Distribution Fees None
Other Expenses
Administrative Fee (1) .14%
All Other Expenses .11%
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Total Annual Fund Operating Expenses 1.25%
</TABLE>
EXAMPLE
This example is intended to help you compare the cost of investing in the
Fund with the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all shares at the end of those periods. The Example
also assumes that your investment has a 5% return each year and that the Fund's
operating expenses remain the same. Although your actual costs may be higher or
lower, based on these assumptions, your costs would be:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
- ----------- ----------- ----------- -----------
<S> <C> <C> <C>
$ 127 $ 397 $ 686 $ 1,511
</TABLE>
(1) Under the Fund's Administration Agreement, during the first two months of
the year, the administrative fee was calculated as a monthly fee which
represented the costs of providing administrative services to the Fund based
upon the Administrator's reasonable allocation of expenses, not to exceed .25%
of average daily net assets. Effective March 1, 1998 a new administrative fee
schedule was adopted which provides that the Fund pays a monthly fee calculated
based on the average daily net assets of the Fund.
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PURCHASING SHARES
OPENING A REGULAR NEW ACCOUNT
You can open a new account by:
- - Completing and signing a Weitz Partners, Inc. purchase application;
- - Enclosing a check made payable to Weitz Partners, Inc.
- - Mailing the application and the check to:
Weitz Partners, Inc.
1125 South 103rd Street, Suite 600
Omaha, NE 68124-6008.
PLEASE NOTE THAT THE MINIMUM INVESTMENT REQUIRED TO OPEN A REGULAR ACCOUNT IS
$100,000. SUBSEQUENT MINIMUM INVESTMENTS OF $5,000 MAY BE REQUIRED, SUBJECT TO
CERTAIN EXCEPTIONS.
The Fund reserves the right, in its sole discretion, to reject any order or
subsequent purchase, to waive initial and subsequent investment minimums for new
accounts and to modify investment minimums from time to time. All purchase
orders are subject to acceptance by authorized officers of the Fund and are not
binding until so accepted.
OPENING A RETIREMENT ACCOUNT
Certain individuals may be eligible to open a traditional IRA, a Roth IRA or
a SEP IRA. In addition, existing IRA accounts and certain qualified pension and
profit sharing plans can be rolled over or transferred into a new IRA account,
which can be invested in shares of the Fund. You can request information about
establishing an IRA by calling the Fund at 402-391-1980 or 800-232-4161. After
reviewing the material, you may open an IRA account by:
- - Completing the IRA application and the transfer form, if applicable;
- - Mailing the forms to the address shown above. IRA accounts may be charged an
annual maintenance fee.
Shares of the Fund may be also be purchased as an investment in other types
of pension or profit sharing plans. Although the Fund will endeavor to provide
assistance to shareholders who are participants in such plans, it does not have
forms of such plans for adoption and does not undertake to offer advice relating
to the establishment of such plans or compliance with the ongoing requirements
for such plans. Plan participants should seek the guidance of a professional
adviser before investing retirement monies in shares of the Fund.
PURCHASING SHARES OF THE FUND
You pay no sales charge when you purchase shares of the Fund. The price you
pay for Fund shares is the Fund's net asset value per share which is calculated
as of the close of trading on the New York Stock Exchange (ordinarily 3:00 p.m.
Central Time) every day the exchange is open. If your order is accepted on any
day prior to such time, you will receive the net asset value calculated on that
day. If your order is accepted on any day after such time, you will receive the
net asset value calculated on the next business day. The shares you purchase
must be qualified for sale in your state of residence. You can purchase shares
in the following manner:
BY MAIL. You can purchase additional shares in an existing account by:
- - Sending a check made payable to Weitz Partners, Inc.;
- - Completing the information on the remittance stub which is the bottom portion
of your most recent transaction statement;
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<PAGE>
- - Mailing the check and remittance stub to:
Weitz Partners, Inc.
1125 South 103rd Street, Suite 600
Omaha, NE 68124-6008
If the remittance stub is not available, please indicate on your check or on a
separate piece of paper the account name, your address and your account number.
If you are purchasing shares for a new account, please see the procedures
described above under the heading "Opening a Regular New Account".
If your check is returned because of insufficient funds or because you have
stopped payment on the check, you will be responsible for any losses sustained
by the Fund as a result of custodian or transfer agent fees or a decline in the
net asset value when the shares are cancelled. If you are an existing
shareholder, losses may be collected by redeeming the appropriate amount from
your account.
BY WIRE. You can purchase shares with payment by bank wire by:
- - Calling the Fund at 401-391-1980 or 1-800-232-4161 and furnishing your account
name, address and account number together with the amount being wired and the
name of the wiring bank.
- - Instructing the bank to wire funds as follows:
Norwest Bank Nebraska, N.A.
Omaha, NE
ABA #104000058
Weitz Funds
1155095248
For credit to: Weitz Partners, Inc.
For the account of: Your Account Number and Name
If you are purchasing shares by wire for a new account, you must send a
completed Purchase Application to the Fund at the address set forth above PRIOR
to your purchase. Wired funds are considered received on the day they are
deposited in the Fund's account.
If funds are deposited on any day prior to the close of the New York Stock
Exchange (ordinarily 3:00 p.m. Central Time) you will receive the net asset
value calculated on that day. If funds are deposited after such time, you will
receive the net asset value calculated on the next business day.
THE FUND WILL NOT BE RESPONSIBLE FOR THE CONSEQUENCES OF DELAYS IN THE BANK OR
FEDERAL RESERVE WIRE SYSTEM. BANKS MAY IMPOSE A CHARGE FOR THE WIRE TRANSFER OF
FUNDS.
BY AUTOMATIC INVESTMENT. At the time you open an account you can choose to
make automatic investments in Fund shares at regular intervals (on the 1st or
15th day of the month or, if such day is not a business day, on the next
following business day) by:
- - Completing the Automatic Investment Plan section of the Purchase Application;
- - Sending a voided check from your bank account.
You can add or cancel the automatic investment service or change the amount
by sending a request in writing to the Fund.
If your automatic investment transaction is returned by the bank, the Fund
may hold you responsible for any costs to the Fund resulting from (i) fees
charged to the Fund or (ii) a decline in the net asset value when the shares
issued are canceled.
PURCHASING THROUGH OTHERS
Shares of the Fund may also be purchased through certain broker-dealers and
other financial intermediaries that have entered into selling agreements or
related arrangements with Weitz & Co. or its affiliates. You may be charged a
fee by such broker or financial intermediary if you effect transactions through
such entity. The Adviser may, from time to time, make payments to broker-
-7-
<PAGE>
dealers or other financial intermediaries for certain services to the Fund
and/or its shareholders, including sub-administration, sub-transfer agency and
shareholder servicing. Such payments are made out of the Adviser's own resources
and do not involve additional costs to the Fund or its shareholders.
CHANGING YOUR ADDRESS
You can change the address on your account by sending a written request to
the Fund. Your written request must be signed by ALL registered owners of the
account and should include your account name(s), account number(s) and both the
new and old addresses. To protect you and the Fund, redemptions from an account
are not allowed if the written request to change an address has been received by
the Fund within 24 hours of the redemption request.
CONFIRMATIONS AND SHAREHOLDER REPORTS
Each time you purchase, redeem or exchange shares, you will receive a
confirmation of the transaction from the Fund. At the end of each calendar
quarter you will receive a statement which will include complete information on
activity in your account during that quarter. At the end of each year your
statement will include detailed information on all transactions for that year.
You should save the year-end statement for tax purposes.
The Fund also provides quarterly shareholder reports which include a listing
of the securities in the portfolio at the end of the quarter, together with a
letter from the portfolio manager discussing, among other things, investment
results for the quarter. The report for the period ending June 30 will also
include unaudited financial statements. The annual report for the period ending
December 31 will include the Fund's audited financial statements for the
previous fiscal year. It is the Fund's practice to send a single copy of each
quarterly report to a shareholder with multiple accounts (single, retirement,
joint, etc.) if such accounts have the same tax identification number and the
same address. A shareholder may request that additional copies of such report be
sent by notifying the Fund.
-8-
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REDEEMING SHARES
REDEMPTION PROCEDURES
You may redeem shares of the Fund at any time by sending a redemption
request in writing to the Fund. A redemption request in good order should
include the following:
- - Your account name, account number and Fund name;
- - The amount of the redemption being requested (specified in dollars or shares);
- - The signatures of ALL account owners exactly as they are registered on the
account; if you are a corporate or trust shareholder, the signature must be by
an authorized person with an indication of the capacity in which such person
is signing;
- - A signature guarantee, if required;
- - Other supporting legal documents that may be required in the case of estates,
trusts, guardianships, custodianships, partnerships, corporations and certain
other accounts.
The redemption request can be sent by mail or facsimile transmission to:
Weitz Partners, Inc.
1125 South 103rd Street, Suite 600
Omaha, Nebraska 68124-6008
Fax Number 402-391-2125
Shares will be redeemed at the net asset value next determined after receipt
of a redemption request in good order. If your redemption request in good order
is received on any day prior to the close of the New York Stock Exchange
(ordinarily 3:00 p.m. Central Time) shares will be redemed at the net asset
value calculated on that day. If your redemption request in good order is
received after such time, shares will be redeemed at the next asset value
calculated on the next business day. There are no fees for redeeming shares. You
must have a completed application on file with the Fund before a redemption
request will be accepted. In addition, the Fund must have received payment for
the shares being redeemed and may delay the redemption payment (normally not
more than 15 days) until the purchase funds have cleared. Such delays can be
avoided by purchasing shares with a certified or cashier's check or by wire
transfer.
You may call the Fund at 402-391-1980 or 800-232-4161 if you have questions
about the requirements for redemption requests.
REDEMPTION PAYMENTS
Payment for the shares redeemed will be made as soon as possible, but no
later than seven days after the date of the Fund's receipt of your redemption
request in good order. Payment will normally be made by check. Payment may also
be made by wire transfer in accordance with wire instructions provided in
writing to the Fund accompanied by a signature guarantee. The Fund reserves the
right to require you to pay for the cost of transmitting the wire transfer. Your
bank may also impose a charge to receive the wire transfer.
A redemption of shares is treated as a sale for tax purposes which will
generally result in a short-term or long-term capital gain or loss, depending on
how long you have owned the shares
SIGNATURE GUARANTEES
The Fund reserves the right to require a signature guarantee on all
redemptions. Signature guarantees WILL BE REQUIRED in the following
circumstances:
- - A redemption request which is payable to anyone other than the shareholder of
record;
- - A redemption request which is to be mailed to an address other than the
address of record;
- - A redemption request which is payable to a bank account other than the bank
account of record; and
- - Instructions to establish or change wire instructions.
-9-
<PAGE>
A SIGNATURE-GUARANTEED REQUEST MAY NOT BE SENT BY FACSIMILE.
A SIGNATURE GUARANTEE MUST BE OBTAINED FROM AN INSTITUTION PARTICIPATING IN
THE SECURITIES TRANSFER AGENT MEDALLION PROGRAM. SUCH INSTITUTIONS TYPICALLY
INCLUDE COMMERCIAL BANKS THAT ARE FDIC MEMBERS, TRUST COMPANIES, AND MEMBER
FIRMS OF A DOMESTIC STOCK EXCHANGE. A NOTARY PUBLIC IS NOT AN ELIGIBLE
GUARANTOR.
OTHER REDEMPTION INFORMATION
Redemption payments normally will be made wholly in cash. The Fund may,
however, redeem its shares through the distribution of portfolio securities if
and to the extent that redemptions by the same shareholder during any 90-day
period exceed the lesser of (i) $250,000, or (ii) one percent of the net assets
of the Fund at the beginning of the period. Shareholders whose shares are
redeemed in kind may be subject to brokerage commissions or other transaction
charges upon the resale of the distributed securities.
The Fund may suspend redemption privileges or postpone payment at times when
the New York Stock Exchange is closed for other than weekends or holidays, or
under emergency circumstances as permitted by the U. S. Securities and Exchange
Commission.
-10-
<PAGE>
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EXCHANGING SHARES
You can exchange shares of the Fund for shares of a portfolio of Weitz
Series Fund, Inc. EXCHANGES WILL ONLY BE MADE BETWEEN ACCOUNTS WITH IDENTICAL
REGISTRATIONS. The ability to initiate such exchanges by telephone is
automatically established on your account unless you request otherwise. You can
request the exchange of shares by telephone or in writing in the following
manner:
- - If you do not currently have an account in Weitz Series Fund, Inc. you can
request an application and Prospectus for that fund by calling 402-391-1980 or
800-232-4161;
- - Read the Prospectus, complete the application and return it to the Fund at the
address set forth under the caption "Purchasing Shares"; the shares being
acquired must be qualified for sale in your state of residence;
- - Provide the name of the portfolio of Weitz Series Fund, Inc., the account
name, your address and account number and the dollar amount of shares to be
exchanged.
You should be aware that although there are no sales commissions or other
transaction fees related to exchanging shares, such an exchange involves the
redemption of shares from the Fund and the purchase of shares of Weitz Series
Fund, Inc. and any gain or loss on the redemption will be reportable on your tax
return. The price for the shares being exchanged will be the net asset value of
the shares next determined after the Fund receives your exchange request.
The Fund will employ reasonable procedures to confirm that instructions
communicated by telephone are genuine, which will include use of specific
identifying information. When such procedures are followed, the Fund will not be
liable for losses caused by following telephone instructions which are
reasonably believed to be genuine. The Fund reserves the right to revise or
terminate the telephone exchange privilege at any time.
YOU SHOULD PURCHASE SHARES OF THE FUND ONLY IF YOU INTEND TO BE A PATIENT
LONG-TERM INVESTOR. The exchange privilege is offered as a convenience to
shareholders and is NOT intended to be a means of speculating on short-term
movements in securities prices. The Fund reserves the right at any time upon
sixty days' prior notice to suspend, limit, modify or terminate exchange
privileges in order to prevent transactions considered to be harmful to existing
shareholders.
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PRICING OF SHARES
The Fund's net asset value per share is determined once each day as of the
close of trading on the New York Stock Exchange (ordinarily 3:00 p.m. Central
Time) on days on which the New York Stock Exchange is open for business.
Currently the New York Stock Exchange and the Fund are closed for business on
the following holidays (or on the nearest Monday or Friday if the holiday falls
on a weekend):
- New Year's Day
- Martin Luther King, Jr. Day
- Presidents' Day
- Good Friday
- Memorial Day
- Independence Day
- Labor Day
- Thanksgiving
- Christmas
The Fund's net asset value is generally based on the market value of the
securities in the Fund. If market values are not available, the fair value of
securities is determined using procedures approved by the Board of Directors of
the Fund.
-12-
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DISTRIBUTIONS AND TAXES
SHAREHOLDER DISTRIBUTIONS
You will receive dividends from the Fund which are your share of the Fund's
net income and gain on its investments. The Fund passes substantially all of its
earnings along to its shareholders in the form of dividends. Dividends are
generally paid in June and December of each year. The Fund may declare dividends
in December of a calendar year, payable to shareholders of record in that month,
but not pay such dividends to shareholders until January of the following year.
In such an event, the dividend will be taxable to shareholders as though
received on December 31st of the year in which the dividend was declared.
You will receive your distributions from the Fund in additional shares of
the Fund unless you choose to receive your distribution in cash. If you wish to
change your instructions, you must notify the Fund in writing. Cash payment of
distributions, if requested , will generally be mailed within five days of the
date such distributions are paid. If you have elected to receive distributions
in cash and your check is returned as undeliverable, you will not receive
interest on amounts represented by the uncashed check.
TAXATION OF DISTRIBUTIONS
Dividends and distributions paid by the Fund are taxable to most investors
(unless your investment is in a IRA or other tax-advantaged account).
Distributions are taxable regardless of how long you have owned shares of the
Fund and whether your distributions are reinvested in shares of the Fund or paid
to you in cash. Distributions that are derived from net long-term capital gains
from the sale of securities the Fund owned for more than 12 months generally
will be taxed as long-term capital gains. All other distributions, including
short-term capital gains, generally will be taxed as ordinary income.
Early each calendar year the Fund will send you the information you will
need to report on your tax return the amount and type of dividends and
distributions you receive.
TAXATION OF SALES AND EXCHANGES
If you sell shares of the Fund or exchange shares of the Fund for shares of
a portfolio of Weitz Series Fund, Inc., you will be taxed on the amount of any
gain. The gain will generally be determined by subtracting your tax basis in the
shares from the redemption proceeds or the value of shares received. Your tax
basis will depend on the original purchase price you paid and the price at which
any dividends may have been reinvested. You should keep your annual account
statements so that you or your tax advisor will be able to properly determine
the amount of any taxable gain.
BUYING SHARES PRIOR TO A DISTRIBUTION
You should consider the tax implications of buying shares immediately prior
to a distribution. If you purchase shares shortly before the record date for a
distribution, you will pay a price for such shares that includes the value of
the anticipated distribution and you will be taxed on the distribution when it
is received even though the distribution represents a return of a portion of the
purchase price.
-13-
<PAGE>
- --------------------------------------------------------------------------------
MANAGEMENT
INVESTMENT ADVISER
Wallace R. Weitz & Company is the Fund's investment adviser. Weitz & Co. is
located at One Pacific Place, 1125 South 103rd Street, Suite 600, Omaha,
Nebraska 68124. Weitz & Co. provides investment advice to the Fund and is
responsible for the overall management of the Fund's business affairs, subject
to the supervision of the Fund's Board of Directors. Weitz & Co. is a Nebraska
corporation formed in March, 1983 and also serves as investment adviser to four
portfolios of Weitz Series Fund, Inc., three investment limited partnerships and
certain individual accounts.
Weitz & Co. receives an annual investment management fee equal to 1% of the
Fund's average daily net assets. The Fund pays all expenses directly
attributable to it. Weitz & Co. has voluntarily agreed to reimburse the Fund or
to pay directly a portion of the Fund's expenses to the extent of the advisory
fee paid if expenses, excluding taxes, interest and brokerage commissions,
exceed 1.50% of the Fund's annual average net assets.
Weitz & Co. also provides administrative services to the Fund persuant to an
Administration Agreement which provides that the Fund will pay Weitz & Co. a
monthly administrative fee based on the average daily net assets of the Fund.
PORTFOLIO MANAGER
Wallace R. Weitz is primarily responsible for the day-to-day management of
the Fund's portfolio. Mr. Weitz has been portfolio manager for the Fund since
its inception. Prior to founding the investment adviser in 1983, he served as an
account executive and securities analyst with G.A. Saxton & Co., Inc.
(1970-1973) and with Chiles Heider & Co. (1973-1983).
FUND DISTRIBUTOR
The Fund is distributed by Weitz Securities, Inc., a Nebraska corporation
which is affiliated with the investment adviser. Shares of the Fund are sold
without any sales commissions or other transactions fees. Weitz Securities, Inc.
pays any sales or promotional costs incurred in connection with the sale of the
Fund's shares.
-14-
<PAGE>
- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
CODE OF ETHICS
The Fund and Weitz have each adopted a written Code of Ethics which, among
other things:
- - requires all employees to obtain preclearance before executing any personal
securities transactions;
- - requires all employees to report their personal securities transactions at the
end of each quarter;
- - restricts employees from executing personal trades in a security if there are
any pending orders in that security by the Fund;
- - restricts portfolio managers from executing personal trades in a security for
a period of seven days before and seven days after a transaction in that
security by any fund managed by that portfolio manager; and
- - prohibits employees from profiting from the purchase and sale of the same
security within a period of 60 days.
The Fund's Board of Directors reviews the administration of the Code of
Ethics annually and may impose penalties for violations of the Code.
YEAR 2000
The Fund relies extensively on various computer systems in carrying out its
business activities, including the computer systems of its service providers
such as Weitz & Co., the Fund's investment adviser and administrator and Norwest
Bank Minnesota, N.A., the Fund's custodian. The Fund is aware of the "Year 2000
Issue" involving potential problems for computer system users after December 31,
1999, when computers using date-sensitive software must be able to properly
identify the Year 2000 in their systems. The failure to make the proper
identification of the Year 2000 could result in a system failure or
miscalculations causing disruptions of operations such as pricing errors and
account maintenance failures.
Weitz & Co. has developed a plan to address the Year 2000 Issue. The plan
has been reviewed by Weitz & Co.'s management and the Fund's Board of Directors.
Weitz & Co.'s network is comprised of a single file server and individual
workstations with desktop machines, related peripherals and software developed
by third parties, including a combination of off-the-shelf applications and
accounting or industry specific applications developed by third party vendors.
Weitz & Co. has no internally developed or modified software applications. Weitz
& Co. has recently replaced or expanded the majority of its network. These
changes have all been effected with the Year 2000 Issue in mind. Weitz & Co. has
been in communication with critical third party service providers who have
provided assurances that they are either Year 2000 compliant or are in the final
stages of testing. As Weitz & Co. investigates certain possible changes in the
third party service providers, Weitz & Co. intends to make inquiries and obtain
assurances about the Year 2000 readiness of such providers.
With respect to the companies in which the Fund invests, Weitz & Co. intends
to review the disclosure included in regular filings with the Securities and
Exchange Commission for certain of those companies in which the Fund has a
significant investment. In addition, Weitz & Co. receives and will continue to
receive Y2K readiness information from securities analysts and from certain of
the issuing companies themselves. The Fund has no reason to believe that these
steps will not be sufficient to avoid any material adverse impact on the Fund,
although there can be no assurance of this. The costs or consequences of
incomplete or untimely resolution of the Year 2000 Issue are unknown to the
Fund, Weitz & Co. and its service providers at this time, but could have a
material adverse impact on the operations of the Fund, Weitz & Co. and its
service providers.
-15-
<PAGE>
FUND CUSTODIAN
Norwest Bank Minnesota, N.A., Sixth and Marquette, Minneapolis, Minnesota
55479-0001, is the Custodian for the Fund.
FUND AUDITOR
McGladrey & Pullen LLP, 555 Fifth Avenue, New York, New York 10017, is the
independent certified public accountant and auditor for the Fund.
FUND LEGAL COUNSEL
Dechert Price & Rhoads, 1775 Eye Street N.W., Washington, DC 20006-2401 is
the Fund's legal counsel.
-16-
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
The following information provides selected data for a share of the Fund
outstanding throughout the periods indicated. Information for the years ended
December 31, 1998, 1997 and 1996 has been audited by McGladrey & Pullen, LLP,
independent certified public accountants, whose report thereon, which is
incorporated by reference, appears in the Fund's Annual Report. The information
for periods prior to January 1, 1996, was audited by other certified public
accountants.
<TABLE>
<CAPTION>
Year ending December 31,
1998 1997 1996 1995 1994*
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD: $ 15.45 $ 11.52 $ 10.38 $ 8.28 $ 10.00
------------ ------------ ------------ ------------ ------------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income 0.06 0.13 0.06 0.08 0.06
Net gains or losses on securities (realized and
unrealized) 4.00 4.33 1.93 3.11 (0.96)
------------ ------------ ------------ ------------ ------------
Total from investment operations 4.06 4.46 1.99 3.19 (0.90)
------------ ------------ ------------ ------------ ------------
LESS DISTRIBUTIONS:
Dividends from net investment income (0.16) -- (0.06) (0.24) --
Distributions from realized gains (1.67) (0.53) (0.79) (0.85) (0.82)
------------ ------------ ------------ ------------ ------------
Total distributions (1.83) (0.53) (0.85) (1.09) (0.82)
------------ ------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD $ 17.68 $ 15.45 $ 11.52 $ 10.38 $ 8.28
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
TOTAL RETURN 29.1% 40.6% 19.2% 38.7% -9.0%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period ($000) 292,331 133,737 94,846 73,781 51,287
Ratio of expenses to average net assets 1.25% 1.24% 1.23% 1.27% 1.29%
Ratio of net investment income to average net
assets 0.34% 1.11% 0.51% 0.82% 0.67%
Portfolio turnover rate 36% 30% 37% 51% 33%
</TABLE>
*Fund commenced public offering of shares on January 1, 1994.
-17-
<PAGE>
WEITZ PARTNERS, INC.
PARTNERS VALUE FUND
-----------------------------
STATEMENT OF ADDITIONAL INFORMATION
APRIL 30, 1999
This Statement of Additional Information is not a Prospectus. This Statement of
Additional Information relates to the Prospectus of Weitz Partners, Inc. dated
April 30, 1999. The Fund's financial statements for the period ended December
31, 1998 included in its Annual Report are incorporated by reference into this
Statement of Additional Information. Copies of the Annual Report and the
Prospectus may be obtained from the Fund without charge by calling
1-800-232-4161 or by contacting the Fund at 1125 South 103rd Street, Suite 600,
Omaha, Nebraska 68124-6008.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Fund History. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Investment Objective, Policies and Restrictions . . . . . . . . . . . . . . 3
Classification . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Investment Objective and Strategy. . . . . . . . . . . . . . . . . . . 3
Securities and Other Investment Practices. . . . . . . . . . . . . . . 4
Portfolio Turnover . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Management of the Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Directors and Officers of the Fund . . . . . . . . . . . . . . . . . . 10
Compensation Table . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Principal Holders of Securities . . . . . . . . . . . . . . . . . . . . . . 13
Investment Advisory and Other Services. . . . . . . . . . . . . . . . . . . 14
Investment Adviser and Distributor . . . . . . . . . . . . . . . . . . 14
Administrator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Custodian. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Auditor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Legal Counsel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Portfolio Transactions and Brokerage Allocation . . . . . . . . . . . . . . 15
Organization and Capital Structure. . . . . . . . . . . . . . . . . . . . . 17
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Shareholder Meetings . . . . . . . . . . . . . . . . . . . . . . . . . 17
Purchasing Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Pricing of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Redemption of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Taxation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Calculation of Performance Data . . . . . . . . . . . . . . . . . . . . . . 20
Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Appendix A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
</TABLE>
2
<PAGE>
FUND HISTORY
Weitz Partners, Inc. is a Nebraska corporation whose shares are offered in
series with each series representing a separate fund of investments with its own
investment objectives, policies and restrictions. At the present time the only
series is the Partners Value Fund (the "Fund").
On December 31, 1993 the Fund succeeded to substantially all of the assets of
Weitz Partners II-Limited Partnership, a Nebraska investment limited partnership
formed in May of 1983. Wallace R. Weitz, the portfolio manager of the Fund, was
the General Partner of the partnership and managed its assets according to
investment objectives and policies substantially identical to those of the Fund.
INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS
CLASSIFICATION
The Fund is a nondiversified, open-end investment management company as defined
in the Investment Company Act of 1940. Because the Fund is nondiversified, it
may, with respect to 50% of its total assets, concentrate its investments by
investing more than 5% of its total assets in the securities of any one issuer.
As a result, its shares may be more susceptible to adverse changes in the value
of the securities of a particular company.
INVESTMENT OBJECTIVE AND STRATEGY
The Fund's investment objective is capital appreciation. The Fund seeks to
achieve its objective by investing primarily in common stocks and a variety of
securities convertible into common stocks such as rights, warrants, convertible
preferred stocks and convertible bonds. The Fund may also invest in other
securities of a company not convertible into common stock, such as bonds and
preferred stock, which Wallace R. Weitz & Company, the Fund's investment
adviser, determines may offer the opportunity for capital appreciation. Such
securities may be investment grade, non-investment grade or unrated.
The Fund's investment strategy (which is called "value investing") is to (1)
identify attractive businesses that the investment adviser can understand and
which have honest, competent management, (2) estimate the price that an
informed, rational buyer would pay for 100% of that business, and then (3) buy
securities of the business if they are available at a significant discount to
this "business value" or "private market value." The valuation process may focus
on assets values, earning power, the intangible value of a company's
"franchise," or a combination of these variables, depending on the type of
business and other factors. Purchasing securities at a discount to value is
intended to provide what Benjamin Graham called a "margin of safety." The
margin of safety does not eliminate risk, but it is intended to reduce the
likelihood of permanent loss of capital.
3
<PAGE>
The Fund has, however, adopted a policy which allows the Fund to invest for
temporary defensive purposes a portion or all of its assets in high quality
nonconvertible preferred stock, high quality nonconvertible debt securities and
high quality United States Government, state and municipal and governmental
agency and instrumentality obligations, or retain funds in cash or cash
equivalents, such as money market mutual fund shares when the Fund's investment
adviser, believes that prevailing market or economic conditions warrant such a
temporary defensive investment position. Securities issued or guaranteed by the
United States Government may include, for example, treasury bills, notes and
bonds which are direct obligations of the United States Government. Obligations
issued or guaranteed by United States Government agencies or instrumentalities
may include, for example, those of Federal Intermediate Credit Banks, Federal
Home Loan Banks, the Federal National Mortgage Association (FNMA), the Federal
Home Loan Mortgage Corporation (FHLMC), the Government National Mortgage
Association (GNMA) and the Farmers Home Administration. Such securities will
include, for example, those supported by the full faith and credit of the United
States Treasury or the right of the agency or instrumentality to borrow from the
Treasury as well as those supported only by the credit of the issuing agency or
instrumentality. State and municipal obligations, which can be taxable or tax
exempt, may include both general obligation and revenue obligations, issued for
a variety of public purposes such as highways, schools, sewer and water
facilities, as well as industrial revenue bonds issued by public bodies to
finance private commercial and industrial facilities.
SECURITIES AND OTHER INVESTMENT PRACTICES
The Fund has adopted certain fundamental investment restrictions and other
nonfundamental investment policies which are discussed below. Fundamental
investment restrictions cannot be changed without a shareholder vote.
Nonfundamental investment policies can be changed by a vote of the Board of
Directors of the Fund.
INDUSTRY CONCENTRATION Although the Fund has adopted a fundamental investment
restriction which does not allow the Fund to concentrate its investments in any
one industry, it reserves the right to invest up to 25% of the value of its net
assets in the securities of companies principally engaged in a particular
industry.
CONVERTIBLE SECURITIES In addition to common stocks, the Fund may invest in
other securities having equity features because they are convertible into, or
represent the right to purchase, common stock. Convertible bonds and debentures
are corporate debt instruments, frequently unsecured and subordinated to senior
corporate debt, which may be converted into common stock at a specified price.
Such securities may trade at a premium over their face amount when the price of
the underlying common stock exceeds the conversion price, but otherwise will
normally trade at prices reflecting current interest rate levels.
WARRANTS AND RIGHTS Warrants and rights are options to purchase common stock at
a specified price for a specified period of time. Their trading price will
normally reflect the relationship
4
<PAGE>
between the option price and the current market price of the underlying common
stock. If not sold or exercised before their expiration date they become
valueless.
OTHER SECURITIES Although the Fund primarily invests in common stocks and
securities convertible into common stocks, it may also invest in other
securities, including preferred stock and debt securities, which the investment
adviser determines may offer the opportunity for capital appreciation. Such
securities may or may not be rated investment grade or may be unrated. Generally
investment grade securites are those with a rating of BBB or better by Standard
and Poors or Baa or better by Moodys. A complete description of the Standard and
Poor's and Moody's ratings of securities is attached as Appendix A.
Securities rated BBB/Baa are considered "investment grade" by the financial
community, but are described by Standard & Poors and Moodys as "medium grade
obligations" which have "speculative characteristics". The market values of
lower-rated and unrated securities tend to reflect individual corporate
developments to a greater extent than do higher-rated securities, which react
primarily to fluctuations in the general level of interest rates. Lower-rated
and unrated securities also tend to be more sensitive to economic conditions
than are higher-rated securities and thus generally involve more credit risk.
Changes in economic conditions or other circumstances may cause issuers of
lower-rated or unrated securities to have more difficulty making principal and
interest payments than issuers of higher-rated securities.
Changes in the value of lower-rated or unrated securities subsequent to their
acquisition will not affect cash income, but will be reflected in the net asset
value of shares of the Fund. The market for lower-rated or unrated securities
may be less liquid than the market for higher-rated securities. In addition,
the liquidity of these lower-rated or unrated securities may be affected by the
market's perception of their credit quality. Therefore, the judgment of the
investment adviser may at times play a greater role in valuing these securities
than is the case with investment grade securities. It also may be more
difficult during times of adverse market conditions to sell lower-rated or
unrated securities at their fair market value to meet redemption requests or to
respond to changes in the market. Although the ratings of established rating
agencies may be considered in evaluating a particular security, the investment
adviser will not rely exclusively on such ratings, but will supplement such
ratings with its independent and ongoing review of credit quality. The Fund did
not invest in any lower-rated or unrated securities during the fiscal year ended
December 31, 1998. A complete description of the Standard and Poor's and Moody's
ratings of debt securities is attached as Appendix A.
INVESTMENT COMPANY SHARES The Fund may purchase securities of other investment
companies subject to the restrictions of the Investment Company Act of 1940. The
Fund does not intend to purchase any such securities involving the payment of a
front-end sales load, but may purchase shares of investment companies
specializing in securities in which the Fund has a particular interest or shares
of closed-end investment companies which frequently trade at a discount from
their net asset value. Investing in the shares of other registered investment
companies involves the risk that such other registered investment companies will
not achieve their objectives or will achieve a yield or return that is lower
than that of the Fund. Investing in the securities of other
5
<PAGE>
investment companies indirectly results in the investor paying not only the
advisory and related fees of the Fund, but also advisory and related fees of the
other investment company.
FOREIGN SECURITIES The Fund may purchase foreign securities that are listed on a
principal foreign securities exchange or over-the-counter market, or which are
represented by American Depository Receipts and are listed on a domestic
securities exchange or traded in the United States over-the-counter market. The
Fund may occasionally convert U.S. dollars into foreign currency, but only to
effect securities transactions on a foreign securities exchange and not to hold
such currency as an investment. The Fund will not invest in forward foreign
currency contracts. While the Fund does not intend to invest any significant
portion of its assets in foreign securities, it reserves the right to invest not
more than 25% of the value of its total assets in the securities of foreign
issuers and obligors.
Investors should recognize that investments in foreign companies involve certain
considerations that are not typically associated with investing in domestic
companies. An investment may be affected by changes in currency rates and in
exchange control regulations. Foreign companies are not generally subject to
uniform accounting, auditing and financial reporting standards comparable to
those applicable to domestic companies, and there may be less publicly available
information about a foreign company than about a domestic company. Some foreign
stock markets may have substantially less trading activity than the U.S.
securities markets, and securities of some foreign companies may be less liquid
than securities of comparable domestic companies. Also, commissions on
transactions in foreign securities may be higher than similar transactions on
domestic stock markets and foreign governments may impose taxes on securities
transactions or ownership. There is generally less regulation of stock
exchanges, brokers, and listed and unlisted companies in foreign countries than
in the United States. In addition, individual foreign economies may differ
favorably or unfavorably from the economy of the United States in such respects
as growth of gross national product, rate of inflation, capital reinvestment,
resource self-sufficiency and balance of payments position.
RESTRICTED/ILLIQUID SECURITIES The Fund may invest in securities acquired in a
privately negotiated transaction directly from the issuer or a holder of the
issuer's securities and which, therefore, could not ordinarily be sold by the
fund except in another private placement or pursuant to an effective
registration statement under the Securities Act of 1933 or an available
exemption from such registration requirements. The Fund will not invest in any
such restricted or illiquid securities which will cause the then aggregate value
of all such securities to exceed 15% of the value of the Fund's total assets.
Restricted and illiquid securities will be valued in such manner as the Board
of Directors in good faith deems appropriate to reflect their fair value. The
purchase price, subsequent valuation and resale price of restricted securities
normally reflect a discount from the price at which such securities trade when
they are not restricted, since the restriction makes them less marketable. The
amount of the discount from the prevailing market price will vary depending upon
the type of security, the character of the issuer, the party who will bear the
expenses of registering the restricted securities, and prevailing supply and
demand conditions.
6
<PAGE>
COVERED CALL OPTIONS The Fund may write covered call options to generate
premium income which the investment adviser considers to be an acceptable
investment result. Covered call options are contracts sold on a national
exchange or in the over-the-counter options market which allow the purchaser to
buy the underlying security at a specified price (the "strike price") prior to a
certain date. "Covered" options are those in which the option seller (the
"writer") owns the underlying securities. Writing covered call options may
increase the Fund's income since it receives a premium for writing the option.
If the Fund writes covered call options, the underlying security will be subject
to certain deposit procedures and unavailable for sale during the term of the
option. As a result, the Fund will forego any opportunity for appreciation in
such securities during the term of the option. The Fund may attempt to protect
itself against a decline in the price of the underlying security or may attempt
to benefit from an anticipated increase in such price, by closing the covered
call position, that is, purchasing an identical call in the open market. There
is no assurance, however, that such calls will always be available for purchase
in the secondary market at a price which will produce the desired result. The
absence of a liquid secondary market in such securities could result from
numerous circumstances, such as insufficient trading interest, restrictions
imposed by exchanges as to options trading generally or suspensions affecting
particular securities, inadequacy of exchange or clearing corporation facilities
or decisions by exchanges to discontinue or limit operations trading.
BANK OBLIGATIONS The Fund may purchase bank obligations, including negotiable
certificates of deposit and bankers' acceptances, which evidence the banking
institution's obligation to repay funds deposited with it for a specified period
of time at a stated interest rate. The Fund will normally purchase such
obligations from financial institutions which have capital, surplus and
undivided profits in excess of $100,000,000 as of the date of the bank's most
recently published financial statements and financial institutions whose
obligations are insured by the Federal Deposit Insurance Corporation.
Certificates of deposit generally have penalties for early withdrawal, but can
be sold to third parties subject to the same risks as other fixed income
securities.
COMMERCIAL PAPER The Fund may purchase commercial paper which consists of
short-term unsecured promissory notes. The Fund will purchase only commercial
paper either (a) rated Prime 1 by Moody's or A-1 by Standard & Poors, or (b) if
not rated, issued by or guaranteed by companies which have an outstanding debt
issue rated AA or better by Standard & Poors of Aa or better by Moody's. See
Appendix A for a description of ratings.
SHORT SALES, PUT AND CALL OPTIONS The Fund may engage in short sales and buy put
options and sell call options. Short sales involve the sale of a security that
the Fund does not own (but instead has borrowed) in anticipation of a decline in
the value of the security. To the extent that the Fund engages in short sales,
the Fund will place in a segregated account a sufficient amount of cash and
securities as required by applicable federal securities regulations in order to
cover the transaction. In the event that the value of the security sold short
increases in value rather than decreases, the Fund would suffer a loss when it
purchases the security sold short. Since there is, theoretically, no limit to
how high the price of the stock might rise, the potential loss from the short
sale is greater than the original proceeds of the short sale. The Fund may also
engage in
7
<PAGE>
short sales "against the box". A short sale "against the box" is a form of short
sale in which the Fund contemporaneously owns or has the right to obtain at no
additional cost securities identical to those sold short. The segregation of
cash or other securities is not required for short sales "against the box". In
the event that the Fund were to sell securities short "against the box" and the
price of such securities were to then increase rather than decrease, the Fund
would forego the potential realization of the increased value of the shares sold
short.
Options such as puts and calls are contracts giving the holder the right to
either buy or sell a financial instrument at a specified price before a
specified time. Investments in puts and calls involve certain risks including
the risk that since puts and calls are options which have an expiration date,
the Fund could lose the entire cost of those puts and calls which expire
worthless.
FUNDAMENTAL INVESTMENT RESTRICTIONS The following investment restrictions are
fundamental restrictions which cannot be changed without the approval of a
majority of the Fund's outstanding shares. "Majority" means the lesser of (a)
67% or more of the Fund's outstanding shares voting at a special or annual
meeting of shareholders at which more than 50% of the outstanding shares are
represented in person or by proxy or (b) more than 50% of the Fund's outstanding
shares.
The Fund may not:
1. Underwrite the securities of other issuers, except the fund may
acquire restricted securities under circumstances such that, if the
securities are sold, the Fund might be deemed to be an underwriter for
purposes of the Securities Act of 1933.
2. Purchase or sell real estate or interests in real estate, but the Fund
may purchase marketable securities of companies holding real estate or
interests in real estate.
3. Purchase or sell commodities or commodity futures contracts.
4. Issue any senior securities (as defined in the Investment Company Act
of 1940) other than as set forth in restriction number 6.
5. Make loans to other persons except by the purchase of a portion of an
issue of publicly traded bonds, debentures or other debt securities;
provided, however, that the Fund may purchase privately sold bonds,
debentures or other debt securities immediately convertible into
equity securities, subject to the restrictions applicable to the
purchase of restricted or illiquid securities.
6. Borrow money except for temporary or emergency purposes and then only
from banks and in an aggregate amount not exceeding 5% of the value of
the Fund's total assets at the time any borrowing is made.
7. Purchase securities on margin; provided, however the Fund may obtain
such short-term credits as may be necessary for the clearance of
purchases and sales of securities.
8. Participate on a joint or joint and several basis in any securities
trading account.
9. Invest in companies for the purpose of exercising management or
control.
10. Invest more than 25% of the value of its net assets in the securities
of any one industry.
8
<PAGE>
11. As to 50% of its total assets, invest more than 5% of its total
assets, taken at market value at the time of a particular purchase, in
securities of any one issuer (other than in U.S. Government
Securities).
12. Adopt any investment objective other than as described above under the
caption "Securities and Other Investment Practices".
PORTFOLIO TURNOVER
The portfolio turnover rate for the Fund is the ratio of the lesser of annual
purchases or sales of securities for the Fund to the average monthly value of
such securities, not including short-term securities maturing in less than 12
months. A 100% portfolio turnover rate would occur, for example, if the lesser
of the value of purchases or sales of securities for a particular year were
equal to the average monthly value of the securities owned during such year. The
portfolio turnover for the Fund for the periods ended December 31, 1998 and
December 31, 1997, was 36% and 30%, respectively. The Fund does not expect to
have a portfolio turnover rate in excess of 100%. The portfolio turnover rate
will not be a limiting factor if the investment adviser determines that changes
in the Fund's portfolio are appropriate. The higher a portfolio's turnover
rate, the higher will be its expenditures for brokerage commissions and related
transaction costs.
9
<PAGE>
MANAGEMENT OF THE FUND
BOARD OF DIRECTORS
The Board of Directors of the Fund is responsible for managing the business and
affairs of the Fund. There are currently six members of the Board of Directors.
The Board exercises all of the rights and responsibilities required by, or made
available under, Nebraska corporate law.
DIRECTORS AND OFFICERS OF THE FUND
The following table sets forth certain information with respect to the officers
and directors of the Fund:
<TABLE>
<S> <C>
*Wallace R. Weitz President, Wallace R. Weitz & Company, a
President, Treasurer registered investment adviser, since July,
And Director 1983; President, Weitz Securities, Inc. a
Age: 50 registered broker-dealer, since January,
1986; President, Treasurer and Director of
Weitz Series Fund, Inc. since 1990;
President, Treasurer and Director, Weitz
Value Fund, Inc., January, 1986 until March,
1990; Account Executive and Financial Analyst
for Chiles, Heider & Co., Inc. (1973-1983)
and for G.A. Saxton & Co., Inc. (1970-1973);
Chartered Financial Analyst and 1970 graduate
of Carleton College with a degree in
economics
Lorraine Chang Independent Consultant (organizational change
Director strategies-government and non-profit
Age: 48 organizations) since 1995; Associate
Assistant Secretary, United States Department
of Labor (1993-1995); General Manager, Union
Pacific Railroad (1980-1987); Director Weitz
Series Fund, Inc. since June, 1997
John W. Hancock Partner, Hancock & Dana (certified public
Director accountants) since its inception in 1985;
Age: 51 Director, Weitz Series Fund, Inc., since
1990; Director, Weitz Value Fund, Inc.,
January, 1986 until March, 1990; Senior Tax
Manager, Peat, Marwick, Mitchell & Co.,
Omaha, Nebraska (1978-1985)
</TABLE>
10
<PAGE>
<TABLE>
<S> <C>
Richard D. Holland Prior to his retirement in 1984, Mr. Holland
Director was Vice Chairman of Rollheiser, Holland &
Age: 78 Kahler, an advertising company (1979-1984)
and President of Holland, Dreves & Reilly, an
advertising company (1954-1979); Director,
Weitz Series Fund, Inc. since June, 1995
*Thomas R. Pansing, Jr. Partner, Gaines, Mullen, Pansing, Hogan,
Director attorneys, since 1973; Director, Weitz Series
Age: 54 Fund, Inc. since 1990; Director, Weitz Value
Fund, Inc., January, 1986 until March, 1990
Delmer L. Toebben President, Curzon Advertising & Display, Inc.
Director since 1977; Director, Weitz Series Fund, Inc.
Age: 68 since July of 1996
Mary K. Beerling Vice President, Wallace R. Weitz & Company
Vice President and since July of 1994; Vice President, Weitz
Secretary Securities, Inc. since July of 1994; Partner,
Age: 58 Kutak Rock, attorneys, from 1989 to 1994
Linda L. Lawson Vice President, Wallace R. Weitz & Company
Vice President since June of 1992; Manager, Marketing
Age: 45 Financial Management, Mutual of Omaha (1988-
1992) Linda Lawson is the sister of Richard F.
Lawson.
Richard F. Lawson Vice President, Wallace R. Weitz & Company
Vice President and since December of 1992 and a financial
Assistant Secretary analyst since January of 1991; Portfolio
Age: 41 Manager, Hickory Portfolio of Weitz Series
Fund, Inc. since 1992; Vice President, Weitz
Securities, Inc. since March of 1995;
Management Consultant, Temple, Barker &
Sloane, Inc. (1984-1989)
Richard Lawson is the brother of Linda L. Lawson.
</TABLE>
*Mr. Weitz and Mr. Pansing are "interested persons" ( as that term is defined in
the Investment Company Act of 1940 ) of the Fund and the Investment Adviser.
11
<PAGE>
COMPENSATION TABLE
The table below includes certain information with respect to compensation of all
directors of the Fund for the fiscal year ended December 31, 1998. Compensation
of the officers of the Fund is paid by the investment adviser.
<TABLE>
<CAPTION>
Total Compensation
Aggregate From Company and
Name of Compensation from Weitz Series Fund, Inc.
Person, Position the Company Paid to Directors
---------------- ----------- -----------------
<S> <C> <C>
Lorraine Chang, Director $1,200 $6,000
John W. Hancock, Director 1,428 6,600
Richard D. Holland, 1,428 6,600
Director
Thomas R. Pansing Jr., 1,200 6,000
Director
Delmer L. Toebben, 1,000 5,000
Director
Wallace R. Weitz, 0 0
Director (1)
</TABLE>
(1) As a director who is also an officer of the investment adviser, Mr. Weitz
received no compensation for his services as a director.
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<PAGE>
PRINCIPAL HOLDERS OF SECURITIES
On March 31, 1999, the Fund had [ ] shares of its
common stock outstanding. As of that date the directors and officers of the
Fund collectively owned [ ] shares which represented approximately %
of the outstanding shares of the Fund. Also as of that date the following
persons owned 5% or more of the Fund:
<TABLE>
<CAPTION>
Name and Address Shares/Nature of Ownership Percent Owned
- ---------------- -------------------------- -------------
<S> <C> <C>
[To Be Provided]
</TABLE>
13
<PAGE>
INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER AND DISTRIBUTOR
Wallace R. Weitz & Company, a Nebraska corporation wholly owned by Wallace R.
Weitz, is the Fund's investment adviser. Weitz Securities, Inc., a Nebraska
corporation also wholly owned by Wallace R. Weitz, distributes the Fund's shares
on a continuous basis without compensation from the Fund.
In accordance with an investment advisory agreement, the Fund pays the
investment adviser, on a monthly basis, an annual advisory fee equal to 1% of
the Fund's average daily net assets. The total amount of advisory fees during
the fiscal years ended December 31, 1998, 1997 and 1996 was $1,905,319,
$1,124,589 and $862,790, respectively.
The investment adviser is responsible for selecting the Fund's securities. In
addition, the investment adviser also provides certain management and other
personnel to the Fund. Weitz Securities, Inc., in its capacity as principal
underwriter, will pay any sales or promotional costs incurred in connection with
the sale of the Fund's shares.
The Fund pays all expenses of operations not specifically assumed by the
investment adviser. Such costs include, without limitation: custodial,
administrative and transfer agent fees; fees of legal counsel and independent
public accountants; compensation of directors (other than those that are also
officers of the investment adviser); expenses of printing and distributing to
shareholders notices, proxy solicitation material, prospectuses and reports;
brokerage commissions; taxes; interest; payment of premiums for certain
insurance carried by the Fund; and expenses of complying with federal, state and
other laws.
The investment advisory agreement provides that neither the investment adviser
nor any of its officers or directors, agents or employees will have any
liability to the Fund or its shareholders for any error of judgment, mistake of
law or any loss arising out of any investments, or for any other act or omission
in the performance of its duties as investment adviser under the agreement,
except for liability resulting from willful misfeasance, bad faith or gross
negligence on the part of the investment adviser in the performance of its
duties or from reckless disregard by the investment adviser of its obligations
under the agreement. The investment adviser has contractually retained all
rights to the use of the name "Weitz " by the Fund. If the Fund were to contract
with another investment adviser, the Fund could be required to change its name.
The investment adviser has voluntarily agreed to reimburse the Fund or to pay
directly a portion of the Fund's expenses to the extent of the advisory fee
paid, if expenses, excluding interest, taxes and brokerage commissions, exceed
1.50% of the Fund's annual average net assets.
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<PAGE>
ADMINISTRATOR
Wallace R. Weitz & Company is also the Fund's administrator in accordance with
an administration agreement with the Fund. Under the agreement, effective March
1, 1998, the Fund pays the administrator a monthly fee equal, on an annual
basis, to .150% of average daily net assets, but not less than $25,000 per year.
Prior to this date the Fund paid a monthly fee based upon the costs to the
administrator of providing services to the Fund based upon the administrator's
reasonable allocation of expenses, but not to exceed .25% of the net assets of
the Fund. Services provided under the administration agreement include, without
limitation, customary services related to fund accounting, record keeping,
compliance, registration, transfer agent and dividend disbursing. The total
amount of fees paid under the administration agreement for the fiscal years
ended December 31, 1998, 1997 and 1996 was $276,929, $126,978 and $99,953,
respectively.
CUSTODIAN
The Fund's custodian is Norwest Bank Minnesota, N.A., Minneapolis, Minnesota.
The custodian has custody of all securities and cash of the Fund, delivers and
receives payment for securities sold, receives and pays for securities
purchased, collects income from investments, and performs other duties as
directed by officers of the Fund.
AUDITOR
The Fund's independent accountant is McGladrey & Pullen, LLP, New York, New
York. The independent accountant provides audit services and consultation to
the Fund.
LEGAL COUNSEL
The Fund's legal counsel is Dechert Price & Rhoads, 1775 Eye Street N.W.,
Washington DC 20006-2401.
PORTFOLIO TRANSACTIONS AND BROKERAGE ALLOCATION
The investment adviser is responsible for recommendations on buying and selling
securities for the Fund and for determinations as to which broker is to be used
in each specific transaction. The investment adviser attempts to obtain from
brokers the most favorable price and execution available. In over-the-counter
transactions, orders are generally placed with a principal market maker unless
the investment adviser determines that a better price and execution can be
obtained using a broker. The best price to the Fund means the best net price
without regard to the mix between purchase or sale price and commissions, if
any. In selecting broker-dealers and
15
<PAGE>
determining the most favorable price and execution all factors relevant to the
Fund's best interest are considered, including, for example, price, the size 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. Subject to
these considerations, the investment adviser may place orders for the purchase
or sale of Fund securities with brokers or dealers who have provided research,
statistical or other financial information.
Because of such factors, most of which are subject to the best judgment of the
investment adviser, the investment adviser may pay a broker which provides
brokerage and research services to the Fund a commission for a securities
transaction that is higher than the commission another broker would have
charged, provided that the investment adviser has determined in good faith that
the amount of such commission is reasonable in relation to the value of the
brokerage and research services provided by the broker, viewed in terms of
either that particular transaction or the broker's ability to execute difficult
transactions in the future. Research services furnished by brokers through whom
the investment adviser effects securities transactions are used by the
investment adviser in servicing all of its accounts and are not used exclusively
with respect to transactions for the Fund.
Brokerage and research services may include, among other things, information on
the economy, industries, individual companies, statistical information,
accounting and tax law interpretations, legal developments affecting portfolio
securities, technical market action, credit analysis, risk measurement analysis
and performance analysis. Such research services are received primarily in the
form of written reports, telephone contacts and occasional meetings with
securities analysts. Such research services may also be provided in the form of
access to various computer-generated data, computer hardware and software, and
meetings arranged with corporate and industry spokesman. In some cases,
research services are generated by third parties, but are provided to the
investment adviser by or through brokers. Such brokers may pay for all or a
portion of computer hardware and software costs relating to the pricing of
securities.
In the case where the investment adviser may receive both brokerage and research
and other benefits from the services provided by brokers, the investment adviser
makes a good faith allocation between the brokerage and research services and
other benefits and pays for such other benefits in cash.
The investment adviser may aggregate orders for the purchase or sale of the same
security for the Fund, other mutual funds managed by the investment adviser and
other advisory clients. The investment adviser will only aggregate trades in
this manner if all transaction costs are shared equally by the participants on a
pro-rata basis. Such aggregate trading allows the investment adviser to execute
trades in a more timely and equitable manner and to reduce overall commission
charges to clients. The investment adviser may include its own proprietary
accounts in such aggregate trades. The investment adviser will only execute
such a trade subject to its duty of obtaining the best execution of the trade
from the broker selected.
16
<PAGE>
During the fiscal years ended December 31, 1998, 1997 and 1996, the Fund paid
$770,557, $246,365 and $242,786, respectively, in brokerage commission for
securities transactions in the Fund. Because of a significant increase in new
assets coming into the Fund during the year ended December 31, 1998, the total
amount of brokerage commissions during the year related to investing those
assets was significantly higher than total commissions for the previous two
years.
ORGANIZATION AND CAPITAL STRUCTURE
GENERAL
Weitz Partners, Inc. is authorized to issue a total of one billion shares of
common stock in series with a par value of $.00001 per share. Fifty million of
these shares have been authorized by the Board of Directors to be issued in the
series designated the Partners Value Fund. The Board of Directors may authorize
additional shares in series without shareholder approval.
All shares, when issued, will be fully paid and non-assessable and will be
redeemable and freely transferable. All shares have equal voting rights and can
be issued as full or fractional shares. A fractional share has pro rata the same
kind or rights and privileges as a full share. Shares possess no preemptive or
conversion rights.
Each share of the Fund has one vote (with proportionate voting for fractional
shares). On some issues, such as the election of directors, all shares of the
Fund vote together. Cumulative voting is authorized. This means that in a vote
for the election of directors, shareholders may multiply the number of shares
they own by the number of directors and then allocate such votes to one or more
directors, thereby allowing for the possibility that a shareholder may be able
to elect a director even though they do not have a majority of the outstanding
shares. In the event that additional series of shares are authorized as separate
funds, on issues affecting only a particular fund, the shares of the affected
fund vote as a separate series. An example of such an issue would be a
fundamental investment restriction pertaining to only one fund.
SHAREHOLDER MEETINGS
Although the Fund may hold periodic shareholder information meetings, annual
meetings of shareholders will not be held unless called by the shareholders
pursuant to the Nebraska Business Corporation Act or unless required by the
Investment Company Act of 1940 or at the direction of the Board of Directors of
the Fund. Special meetings of the shareholders may be held, however, at any time
and for any purpose, if called (a) by the Chairman of the Board, the President
and two or more directors, (b) by one or more shareholders holding ten percent
or more of the shares entitled to vote on matters presented to the meeting, or
(c) if an annual meeting is not held within the earlier of six months after the
end of the corporation's fiscal year or fifteen months after its last annual
meeting, the Douglas County district court, upon application of any shareholder,
may
17
<PAGE>
summarily order that such meeting be held. The Investment Company Act of 1940
requires a shareholder vote for all amendments to fundamental investment
policies and investment advisory contracts.
PURCHASING SHARES
See "Purchasing Shares" in the Prospectus for basic information on how to
purchase shares of the Fund.
To purchase shares, you should complete a Purchase Application and transfer
funds for the purchase either by sending a check or a wire transfer to the Fund.
The price paid for the shares purchased will be the next determined net asset
value after the Fund receives the application and payment for the shares. The
net asset value of the Fund's shares is determined once each day at the close of
the New York Stock Exchange (ordinarily 3:00 p.m. Central Time). If the
completed order is received before such time, the order will be effective on
that day. If the completed order is received after that time, the order will
be effective on the following business day.
PRICING OF SHARES
The Fund's net asset value per share is determined once each day as of the close
of trading on the New York Stock Exchange (ordinarily 3:00 p.m., Central Time)
on days on which the New York Stock Exchange is open for business. Currently
the New York Stock Exchange and the Fund are closed for business on the
following holidays (or on the nearest Monday or Friday if the holiday falls on a
weekend): New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas.
The net asset value per share is determined by calculating the market value of
all the Fund's assets, deducting total liabilities and dividing the result by
the number of shares outstanding. In calculating the net asset value of the
Fund's shares:
1. Securities traded on a national or regional securities exchange and
over-the-counter securities traded on the NASDAQ national market are valued
at the last sales price; if there were no sales on that day, securities are
valued at the mean between the latest available and representative bid and
asked prices;
2. Securities not listed on an exchange are valued at the mean between the
latest available and representative bid and asked prices;
3. The value of certain debt securities for which market quotations are not
readily available may be based upon current market prices of securities
which are comparable in coupon, rating and maturity or an appropriate
matrix utilizing similar factors; and
18
<PAGE>
4. The value of securities for which market quotations are not readily
available, including restricted and not readily marketable securities, is
determined in good faith in accordance with procedures approved by the
Fund's Board of Directors.
REDEMPTION OF SHARES
Redemption of the Fund's shares may be suspended at times (a) when the New York
Stock Exchange is closed for other than customary weekend or holiday closings,
(b) when trading on the New York Stock Exchange is restricted, (c) when an
emergency exists, as a result of which disposal of securities owned by the Fund
is not reasonably practicable, or it is not reasonably practicable for the Fund
to fairly determine its net asset value, or (d) during any other period when the
Securities and Exchange Commission, by order, so permits, provided that the
applicable rules and regulations of the Securities and Exchange Commission shall
govern as to whether the conditions described in (b) or (c) exist.
The Fund has elected to be governed by Rule 18f-1 under the Investment Company
Act of 1940, which obligates the Fund to redeem shares in cash, with respect to
any one shareholder during any 90-day period, up to the lesser of $250,000 or 1%
of the assets of the Fund. If the investment adviser determines that existing
conditions make cash payments undesirable, redemption payments may be made in
whole or in part in securities or other financial assets, valued for this
purpose as they are valued in computing the Fund's net asset value per share (a
"redemption-in-kind"). Shareholders receiving securities or other financial
assets in a redemption-in-kind may realize a gain or loss for tax purposes, and
will incur any costs of sale, as well as the associated inconveniences.
TAXATION
The Company intends to qualify the Fund as a "regulated investment company"
under Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"), so that the Fund will not have to pay federal income tax on its capital
gains and net investment income distributed to shareholders. To qualify as a
regulated investment company, a Fund must, among other things, receive at least
90% of its gross income each year from dividends, interest, gains from the sale
or other disposition of securities and certain other types of income including,
with certain exceptions, income from options and futures contracts. The Code
also requires a regulated investment company to diversify its holdings. This
means that a fund must have at least 50% of its total assets in cash and cash
items and other securities and as to the securities held, the entire amount of
the securities of any one issuer owned by a fund may not exceed 5% of the value
of 50% of the Fund's assets. Additionally, a fund may not invest more than 25%
of its total assets in the securities of any one issuer. This diversification
test is in contrast to the diversification test under the Investment Company Act
of 1940 which restricts a fund's investment in any one issuer
19
<PAGE>
to 5% as to 75% of the fund's assets. The Fund is non-diversified under the
Investment Company Act of 1940, but is diversified under the Code. The Internal
Revenue Service has not made its position clear regarding the treatment of
options for purposes of the diversification test, and the extent to which the
Fund could buy or sell futures contracts and options may be limited by this
requirement.
The Code requires that all regulated investment companies pay a nondeductible 4%
excise tax to the extent the regulated investment company does not distribute
98% of its ordinary income, determined on a calendar year basis, and 98% of its
capital gains, determined, in general, on an October 31 year end. The required
distributions are based only on the taxable income of a regulated investment
company.
Ordinarily, distributions and redemption proceeds paid to a Fund shareholder are
not subject to withholding of federal income tax. However, if a shareholder
fails to furnish a tax identification number or social security number, or
certify under penalties of perjury that such number is correct, the Company may
be required to withhold federal income tax at the current rate ("backup
withholding") from all dividend, capital gain and/or redemption payments to such
shareholder. Dividends and capital gain distributions may also be subject to
backup withholding if a shareholder fails to certify under penalties of perjury
that such shareholder is not subject to backup withholding or is exempt from
backup withholding. These certifications are included in the purchase
application of the Fund.
CALCULATION OF PERFORMANCE DATA
The Fund may include its total return in advertisements or reports to
shareholders or prospective investors. Total return is the percentage change in
the net asset value of a Fund share over a given period of time, with dividends
and distributions treated as reinvested. Performance of the Fund may be shown by
presenting one or more performance measurements, including cumulative total
return or average annual total return. Cumulative total return is the actual
total return of an investment in the Fund over a specific period of time and
does not reflect how much the value of the investment may have fluctuated during
the period of time indicated. Average annual total return is the annual compound
total return of the Fund over a specific period of time that would have produced
the cumulative total return over the same period if the Fund's performance had
remained constant throughout the period.
YOU SHOULD UNDERSTAND THAT ANY PERFORMANCE DATA PRESENTED REPRESENTS PAST
PERFORMANCE OF THE FUND AND IS NOT INTENDED TO BE REPRESENTATIVE OF FUTURE
PERFORMANCE. INVESTMENT RESULTS WILL FLUCTUATE OVER A PERIOD OF TIME SO THAT
YOUR SHARES IN THE FUND WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST.
The Fund may compare its performance to that of certain widely managed stock
indices including the Dow Jones Industrial Average, the Standard and Poor's 500
Stock Index, the
20
<PAGE>
Lipper Growth and Income Fund Index, the Russell 2000 Index and the NASDAQ and
Value Line Composites. The Fund may also use comparative performance information
compiled by entities that monitor the performance of mutual funds generally such
as Lipper Analytical Services, Inc., Morningstar, Inc. and The Value Line Mutual
Fund Survey.
The Fund succeeded to substantially all of the assets of Weitz Partners
II-Limited Partnership, a Nebraska investment limited partnership (the
"Predecessor Partnership") as of December 31, 1993. The Fund's investment
objectives and policies are substantially identical to those of the Predecessor
Partnership. Wallace R. Weitz was the General Partner and portfolio manager for
the Predecessor Partnership and is the portfolio manager for the Fund. The
average annual total return for the Fund and the Predecessor Partnership for the
one, five and ten year periods ended December 31, 1998 and for the period from
inception (June 1, 1983) to December 31, 1998, was 29.1%, 22.2%, 18.8% and
18.0%, respectively. Cumulative total return for the Fund and the Predecessor
Partnership from inception (June 1, 1983) to December 31, 1998, was 1214.6%.
The Predecessor Partnership was not registered under the Investment Company Act
of 1940 (the "Act") and therefore was not subject to certain investment
restrictions imposed by the Act. If the Predecessor Partnership had been
registered under the 1940 Act, the performance of the Predecessor Partnership
may have been adversely affected.
FINANCIAL STATEMENTS
The audited statements and notes included in the Fund's Annual Report for the
period ended December 31, 1998 are incorporated herein by reference. A copy of
the Annual Report can be obtained without charge by contacting the Fund at its
address or telephone number shown on the cover page of this Statement of
Additional Information.
21
<PAGE>
APPENDIX A
RATINGS OF CORPORATE OBLIGATIONS AND COMMERCIAL PAPER
RATINGS OF CORPORATE OBLIGATIONS
MOODY'S INVESTORS SERVICE, INC.
Aaa: Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.
Aa: Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known
as high grade bonds. They are rated lower than the best bonds because margins
of protection may not be as large as in Aaa securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than in Aaa
securities.
A: Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate but elements may be
present which suggest a susceptibility to impairment sometime in the future.
Baa: Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.
Ba: Bonds rated Ba are judged to have speculative elements; their future
cannot be considered as well assured. Often the protection of interest and
principal payments may be very moderate and thereby not well safeguarded during
both good and bad times over the future. Uncertainty of position characterizes
bonds in this class.
B: Bonds rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
Caa: Bonds rated Caa are of poor standing. Such bonds may be in default
or there may be present elements of danger with respect to principal and
interest.
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<PAGE>
Ca: Bonds rated Ca represent obligations which are speculative in a high
degree. Such bonds are often in default or have other marked shortcomings.
Those securities in the A and Baa groups which Moody's believes possess the
strongest investment attributes are designated by the symbols A-1 and Baa-1.
Other A and Baa securities comprise the balance of their respective groups.
These rankings (1) designate the securities which offer the maximum in security
within their quality groups, (2) designate securities which can be bought for
possible upgrading in quality, and (3) additionally afford the investor an
opportunity to gauge more precisely the relative attractiveness of offerings in
the marketplace.
STANDARD & POOR'S CORPORATION
AAA: Bonds rated AAA have the highest rating assigned by Standard & Poor's
to a debt obligation. Capacity to pay interest and repay principal is extremely
strong.
AA: Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in a small degree.
A: Bonds rated A have a strong capacity to pay interest and repay
principal, although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than bonds in higher rated
categories.
BBB: Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Although they normally exhibit adequate
protection parameters, adverse economic conditions or changing circumstances are
more likely to lead to a weakened capacity to pay interest and repay principal
for bonds in this category than for bonds in higher rated categories. Bonds
rated BBB are regarded as having speculation characteristics.
BB--B--CCC--CC: Bonds rated BB, B, CCC, and CC are regarded, on balance,
as predominantly speculative with respect to the issuer's capacity to pay
interest and repay principal in accordance with the terms of the obligation. BB
indicates the lowest degree of speculation among such bonds and CC the highest
degree of speculation. Although such bonds will likely have some quality and
protective characteristics, these are outweighed by large uncertainties or major
risk exposures to adverse conditions.
COMMERCIAL PAPER RATINGS
STANDARD & POOR'S CORPORATION
Commercial paper ratings are graded into four categories, ranging from "A"
for the highest quality obligations to "D" for the lowest. Issues assigned the
A rating are regarded as having the greatest capacity for timely payment.
Issues in this category are
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<PAGE>
further refined with the designation 1, 2 and 3 to indicate the relative degree
of safety. The "A-l" designation indicates that the degree of safety regarding
timely payment is very strong. Those issues determined to possess overwhelming
safety characteristics will be denoted with a plus sign designation.
MOODY'S INVESTORS SERVICE, INC.
Moody's commercial paper ratings are opinions of the ability of the issuers
to repay punctually promissory obligations not having an original maturity in
excess of nine months. Moody's makes no representation that such obligations
are exempt from registration under the Securities Act of 1933, nor does it
represent that any specific note is a valid obligation of a rated issuer or
issued in conformity with any applicable law. Moody's employs the following
three designations, all judged to be investment grade, to indicate the relative
repayment capacity of rated issuers:
Prime-1 Superior capacity for repayment
Prime-2 Strong capacity for repayment
Prime-3 Acceptable capacity for repayment
24
<PAGE>
PART C
OTHER INFORMATION
Item 23. EXHIBITS
Exhibit No. Description
----------- -----------
*1. Articles of Incorporation
**2. Amended and Restated Bylaws
**5. Management and Investment Advisory Agreement-
Partners Value Fund
*6. Distribution Agreement
*8. Custodian Agreement
9. Amended and Restated Administration Agreement
*10. Opinion and Consent of Cline, Williams, Wright, Johnson &
Oldfather
11. Consent of McGladrey & Pullen, LLP
*13. Subscription Agreement of Wallace R. Weitz
27. Financial Data Schedule
* Incorporated by reference to Fund's Post-Effective Amendment No. 5 on Form
N-1A filed April 30, 1998.
** Incorporated by reference to Fund's Post-Effective Amendment No. 4 on Form
N-1A filed April 30, 1997.
Item 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
None
Item 25. INDEMNIFICATION
Section 21-20,103 of the Nebraska Business Corporation Act allows
indemnification of officers and directors of the Registrant under circumstances
set forth in such section. The Registrant has made such indemnification
mandatory. Reference is made to Article VIII.d. of the Articles of Incorporation
(Exhibit 1) and Article XIII of the Bylaws (Exhibit 2) of the Registrant.
1
<PAGE>
The general effect of these provisions is to require a corporation to indemnify
an individual against judgments, settlements, penalties, fines and reasonable
expenses incurred by a director or officer who is a party to a threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative, formal or informal because the
individual is an officer or director if: (1) the director or officer acted in
good faith; (2) the director or officer reasonably believed: (a) in the case of
conduct in an official capacity, that the conduct was in the best interests of
the corporation; and (b) in all other cases that the conduct was at least not
opposed to the best interests of the corporation; and (3) in the case of a
criminal proceeding, the director or officer had no reasonable cause to believe
the conduct was unlawful. A corporation is permitted to maintain insurance on
behalf of any officer, director, employee or agent of the corporation, or any
person serving as such at the request of the corporation, against any liability
of such person.
Nevertheless, Article VIII.d. of the Articles of Incorporation prohibits any
indemnification which would be in violation of Section 17(h) of the Investment
Company Act of 1940, as amended and Article XIII of the Fund's Bylaws prohibits
any indemnification inconsistent with the guidelines set forth in Investment
Company Act Releases No. 7221 (June 9, 1972) and No. 11330 (September 2, 1980).
Such Releases prohibit indemnification in cases involving willful misfeasance,
bad faith, gross negligence and reckless disregard of duty and establish
procedures for determination of entitlement to indemnification and expense
advances.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification by the Registrant is against public policy as expressed in the
Act and, therefore, may be unenforceable. In the event that a claim for such
indemnification (except insofar as it provides for the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted against the
Registrant by such director, officer or controlling person and the Securities
and Exchange Commission is still of the same opinion, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
or not such indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
In addition to the indemnification provisions contained in the Registrant's
Articles and Bylaws, there are also indemnification and hold harmless provisions
contained in the Investment Advisory Agreement, Distribution Agreement,
Administration Agreement and Custodian Agreement. Finally, the Registrant has
also included in Article XI of its Articles of Incorporation (Exhibit 1) a
provision which eliminates the liability of outside directors to monetary
damages for breach of fiduciary duty of such directors. Such limitation of
liability does not eliminate or limit liability of such directors for any act or
omission not in good faith which involves intentional misconduct or a knowing
violation
2
<PAGE>
of law, any transaction from which such director derived an improper direct
or indirect financial benefit, for paying a dividend or approving a stock
repurchase which was in violation of the Nebraska Business Corporation Act
and for any act or omission which violates a declaratory or injunctive order
obtained by the Registrant or its shareholders.
Item 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER
Principal Occupation
Positions With (Present and for
Name Adviser Past Two Years)
---- ------- ---------------
Wallace R. Weitz President, Treasurer See caption "Management" in
And Director the Statement of Additional
Information forming a part of
this Registration Statement
Barbara V. Weitz Secretary and Faculty Member, University of
Director Nebraska at Omaha
Mary K. Beerling Vice President and See caption "Management" in
Assistant Secretary the Statement of Additional
Information forming a part of
this Registration Statement
Linda L. Lawson Vice President See caption "Management" in
the Statement of Additional
Information forming a part of
this Registration Statement
Richard F. Lawson Vice President See caption "Management" in
the Statement of Additional
Information forming a part of
this Registration Statement
Item 27. PRINCIPAL UNDERWRITERS
(a) The Distributor is also the principal underwriter and distributor of Weitz
Series Fund, Inc., a registered investment management company also advised
by Wallace R. Weitz & Company.
3
<PAGE>
(b) Directors and Officers:
Positions and Positions, and
Name and Principal Offices with Offices with
Business Address Underwriter Registrant
---------------- ----------- ----------
Wallace R. Weitz President, Treasurer President, Treasurer
Suite 600 and Director and Director
1125 South 103 Street
Omaha, NE 68124-6008
Mary K. Beerling Vice President Vice President
Suite 600 and Secretary and Secretary
1125 South 103 Street
Omaha, NE 68124-6008
Richard F. Lawson Vice President Vice President
Suite 600 and Director
1125 South 103 Street
Omaha, NE 68124-6008
(c) Not applicable
Item 28. LOCATION OF ACCOUNTS AND RECORDS
All required accounts, books and records will be maintained by Wallace R. Weitz
& Company, Suite 600, 1125 South 103 Street, Omaha, Nebraska 68124-6008
Item 29. MANAGEMENT SERVICES
Not applicable
Item 30. UNDERTAKINGS
The Registrant undertakes to furnish each person to whom a Prospectus is
delivered a copy of the Registrant's latest annual report to shareholders, upon
request and without charge, in the event that the information called for by Item
5 of Form N-1A has been presented in the Registrant's latest annual report to
shareholders.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Amendment to its
Registration Statement on Form N-1A to be signed on its behalf by the
undersigned authorized individual in the City of Omaha, State of Nebraska, on
the 26th day of February, 1999.
WEITZ PARTNERS, INC.
/s/ Wallace R. Weitz
--------------------
Wallace R. Weitz
President
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
the Registration Statement on Form N-1A has been signed below by the following
persons in the capacities indicated on February 26, 1999:
Signature Title
--------- -----
/s/ Wallace R. Weitz President, Principal Executive
- --------------------- Officer, Principal Financial
Wallace R. Weitz and Accounting Officer and
Director
/s/ Delmer L. Toebben* Director
- ----------------------
Delmer L. Toebben
By /s/ Wallace R. Weitz
--------------------
Wallace R. Weitz
Attorney-in-Fact
/s/ John W. Hancock* Director
- --------------------
John W. Hancock
/s/Thomas R. Pansing, Jr.* Director
- --------------------------
Thomas R. Pansing, Jr.
/s/ Richard D. Holland* Director
- -----------------------
Richard D. Holland
/s/ Lorraine Chang* Director
- -------------------
Lorraine Chang
*Pursuant to Powers of Attorney filed in Post-Effective Amendment Number 5 on
Form N-1A filed April 30, 1998
5
<PAGE>
EXHIBITS
TO
WEITZ PARTNERS, INC.
POST-EFFECTIVE AMENDMENT NUMBER 6
TO FORM N-1A
As filed on February 26, 1999
<PAGE>
EXHIBITS
Exhibit No. Description
- ----------- -----------
9. Amended and Restated Administration Agreement
11. Consent of McGladrey & Pullen, LLP
27. Financial Data Schedule
<PAGE>
EXHIBIT 99.9
AMENDED AND RESTATED ADMINISTRATION AGREEMENT
<PAGE>
ADMINISTRATION AGREEMENT
This amended and restated Agreement dated February 10, 1998 amends and
restates the Agreement dated February 10, 1997 between WEITZ PARTNERS, INC., a
Nebraska corporation, having its principal office and place of business at
Omaha, Nebraska (the "Fund"), and WALLACE R. WEITZ & COMPANY, a Nebraska
corporation, having its principal office and place of business at Omaha,
Nebraska (the "Administrator"),
WHEREAS, the Fund desires to engage the Administrator to provide transfer
agent, dividend disbursing agent and fund accounting and related administrator
services.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
Section 1. TERMS OF APPOINTMENT.
1.01 Subject to the conditions set forth in this Agreement, the Fund hereby
employs and appoints Administrator as the Fund's Administrator, Transfer Agent
and Dividend Disbursing Agent.
1.02 Administrator hereby accepts such employment and appointment and
agrees that on and after the effective date of its appointment it will act as
the Fund's Administrator, Transfer Agent and Dividend Disbursing Agent.
Administrator agrees that it will also act as agent in connection with any
periodic investment plan, periodic withdrawal program or other accumulation,
open-account or similar plans provided to the Fund's shareholders and set out in
the Fund's prospectus.
1.03 Administrator agrees to provide the necessary facilities, equipment
and personnel to perform its duties and obligations hereunder in accordance with
industry practice.
1.04 Administrator agrees that it will perform all of the usual and
ordinary services as Transfer Administrator and Dividend Disbursing
Administrator and as agent for the various shareholder accounts including but
not limited to: issuing, transferring and cancelling stock
<PAGE>
certificates, maintaining all shareholder accounts, preparing annual shareholder
meeting lists, mailing proxies, receiving and tabulating proxies, mailing
shareholder reports and prospectuses, withholding taxes on non-resident alien
accounts, disbursing income dividends and capital gains distributions, preparing
and filing U.S. Treasury Department Form 1099 for all shareholders, preparing
and mailing confirmation forms to shareholders for all purchases and
liquidations of Fund shares and other confirmable transactions in shareholders'
accounts, recording reinvestment of dividends and distributions in Fund shares,
causing liquidation of shares and causing disbursements to be made to withdrawal
plan holders.
1.05 Administrator agrees that it will furnish the Fund with office
facilities, including such space, furniture, equipment and supplies as well as
personnel sufficient to carry out the necessary administrative, clerical and
bookkeeping functions of the Fund. In connection therewith, the Administrator
shall maintain all records required to be maintained for the Fund under the
Investment Company Act of 1940. Additionally, the Administrator shall provide
the following services to the Fund:
i. Daily pricing;
ii. Computation of daily net asset value and reporting to Fund
management, and others as requested;
iii. Prepare daily cash availability reports for Portfolio managers;
iv. Post daily all fund activity and prepare all applicable daily
reports;
v. Accrue expenses daily;
vi. Calculate daily reconciliations of cash, receivables, payable
accounts and shares outstanding;
-2-
<PAGE>
vii. Compute daily dividend rate for appropriate funds;
viii. Compute yields pursuant to S.E.C. formulas;
ix. Provide monthly analysis and reconciliation of all general ledger
accounts;
x. Generate and maintain monthly broker ledgers, commission ledgers and
net trade reports;
xi. Verify accuracy and propriety of bills and invoices, maintain
expenses files and coordinate payment of bills and invoices in a timely manner;
xii. Prepare report on expense limitations as needed;
xiii. Maintain and verify portfolio trade tickets with broker
confirmation;
xiv. Determine income availability for monthly, quarterly and/or annual
dividend/distributions;
xv. Maintain historical record of all Fund net asset values and
dividend/distributions;
xvi. Coordinate audit examination of outside auditors, including
preparation of audit work paper package if required; and
xvii. Produce documents and respond to inquiries during S.E.C. audits.
Section 2. FEES AND EXPENSES.
2.01 For the services to be rendered by Administrator pursuant to
paragraphs 1.04 and 1.05, the Fund agrees to pay Administrator a monthly fee
based upon the schedule set forth as Exhibit A.
2.02 The Fund also agrees promptly to reimburse Administrator for all
reasonable out-of-pocket expenses or advances incurred by Administrator in
connection with the performance of services under this Agreement including, but
not limited to, blue sky notice filing fees, Securities and Exchange Commission
registration fees, costs related to insurance policies, legal counsel,
-3-
<PAGE>
postage, envelopes, checks, drafts, continuous forms, reports and statements,
telephone, telegraph, stationery, supplies, printing, Edgar filings, costs of
outside mailing firms, record storage costs and media for storage of records
(e.g. microfilm, computer tapes or disks). In addition, any other expenses
incurred by Administrator at the request or with the consent of the Fund will be
promptly reimbursed by the Fund.
Section 3. REPRESENTATIONS AND WARRANTIES OF ADMINISTRATOR. Administrator
represents and warrants to the Fund that:
3.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Nebraska;
3.02 It is empowered under applicable laws and by its Articles of
Incorporation and By-laws to enter into and perform the services contemplated in
this Agreement;
3.03 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement; and
3.04 It has and will continue to have and maintain the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement.
Section 4. REPRESENTATIONS AND WARRANTIES OF THE FUND. The Fund
represents and warrants to Administrator that:
4.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Nebraska;
4.02 It is, or prior to the public offering of its shares, will become an
open-end management investment company registered under the Investment Company
Act of 1940;
-4-
<PAGE>
4.03 A registration statement under the Securities Act of 1933 is
currently, or prior to the public offering of its shares, will become effective
and will remain effective, and appropriate state securities laws filings have
been or will be made and will continue to be made, with respect to all shares of
the Fund being offered for sale;
4.04 The Fund is empowered under applicable laws and regulations and by its
charter and By-laws to enter into and perform this Agreement; and all requisite
corporate proceedings have been taken to authorize it to enter into and perform
under this Agreement.
Section 5. INDEMNIFICATION.
5.01 Administrator shall not be responsible and the Fund shall indemnify
and hold Administrator harmless from and against any and all losses, damages,
costs, charges, counsel fees, payments, expenses and liability which may be
asserted against Administrator or for which it may be held to be liable, arising
out of or in any way attributable to:
(a) All actions of Administrator required to be taken by
Administrator pursuant to this Agreement provided that Administrator has
acted in good faith and with due diligence.
(b) The Fund's refusal or failure to comply with the terms of this
Agreement, or which arise out of the Fund's negligence or willful
misconduct or which arise out of the breach of any representation or
warranty of the Fund hereunder.
(c) The reliance on, or the carrying out of, any instructions or
requests of the Fund.
(d) Defaults by dealers with respect to payment for share orders
previously entered.
-5-
<PAGE>
(e) The reliance on, or the carrying out of, any instructions or
requests of the Fund.
(f) The offer or sale of the Fund's shares in violation of any
requirement under federal securities laws or regulations or the securities
laws or regulations of any state or in violation of any stop order or other
determination or ruling by any federal agency or state with respect to the
offer or sale of such shares in such state (unless such violation results
from Administrator's failure to comply with written instructions of the
Fund or of any officer of the Fund that no offers or sales be made in or to
residents of such state).
5.02 Administrator shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liability arising out of Administrator's willful failure to comply
with the terms of this Agreement or which arise out of Administrator's gross
negligence or willful misconduct.
5.03 At any time Administrator may apply to any officer of the Fund for
instructions, and may consult with legal counsel for the Fund or its own legal
counsel, at the expense of the Fund, with respect to any matter arising in
connection with the services to be performed by Administrator under this
Agreement and Administrator shall not be liable and shall be indemnified by the
Fund for any action taken or omitted by it in good faith in reliance upon such
instructions or upon the opinion of such counsel. Administrator shall be
protected and indemnified in acting upon any paper or document believed by it to
be genuine and to have been signed by the proper person or persons and shall not
be held to have notice of any change of authority of any person, until receipt
of written notice thereof from the Fund. Administrator shall also be protected
and indemnified in recognizing stock certificates which Administrator reasonably
believes to bear the proper manual or facsimile
-6-
<PAGE>
signatures of the officers of the Fund, and the proper counter-signature of any
former transfer agent or registrar, or of a co-transfer agent or co-registrar.
5.04 In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage, or other causes reasonably beyond its control,
such party shall not be liable for damages to the other for any damages
resulting from such failure to perform or otherwise from such causes.
5.05 In no event and under no circumstances shall either party to this
Agreement be liable to the other party for consequential damages under any
provision of this Agreement or for any act or failure to act hereunder.
Section 6. COVENANTS OF ADMINISTRATOR AND THE FUND.
6.01 The Fund shall promptly furnish to Administrator the following:
(a) A certified copy of the resolution of the Board of Directors of
the Fund authorizing the appointment of Administrator and the execution and
delivery of this Agreement.
(b) Certified copy of the Articles of Incorporation and By-laws of
the Fund and all amendments thereto.
(c) Specimens of stock certificates, if any, in the form approved by
the Fund's Board of Directors with a certificate of the Secretary of the
Fund as to such approval.
6.02 Administrator hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms, and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account of such certificates,
forms and devices.
-7-
<PAGE>
6.03 To the extent required by Section 31 of the Investment Company Act of
1940 and Rules thereunder, Administrator agrees that all records maintained by
Administrator relating to the services to be performed by Administrator under
this Agreement are the property of the Fund and will be preserved and will be
surrendered promptly to the Fund on request.
6.04 Administrator and the Fund agree that all books, records, information
and data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation of and the carrying out of this Agreement
shall remain confidential, and shall not be voluntarily disclosed to any other
person.
Section 7. TERMINATION OF AGREEMENT.
7.01 This Agreement may be terminated by either party by 90 days written
notice.
Section 8. MISCELLANEOUS.
8.01 Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the written consent of the other.
8.02 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective successors and assigns.
8.03 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof, whether oral or written, and this Agreement may not be modified except
by written instrument executed by both parties.
-8-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by and through their duly authorized officers, as of the day and year
first above written.
WEITZ PARTNERS, INC.
ATTEST: By /s/ Wallace R. Weitz
----------------------------------
President
/s/ Mary K. Beerling
- ---------------------------------
Secretary
WALLACE R. WEITZ & COMPANY
ATTEST: By /s/ Wallace R. Weitz
----------------------------------
President
/s/ Mary K. Beerling
- ---------------------------------
Asst. Secretary
-9-
<PAGE>
WEITZ PARTNERS, INC.
Exhibit A
<TABLE>
<CAPTION>
asset break points
greater than less than % of NAV minimum
<S> <C> <C> <C>
0 1,000,000,000 0.150% 25,000
</TABLE>
-10-
<PAGE>
EXHIBIT 99.11
CONSENT OF MCGLADREY & PULLEN, LLP
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference of our report dated
January 15, 1999, on the financial statements of Partners Value Fund, series of
Weitz Partners, Inc., referred to therein in Post-Effective Amendment No. 6 to
the Registration Statement on Form N-1A, File No. 33-66714 as filed with the
Securities and Exchange Commission.
We also consent to the reference to our firm in the Prospectus under the
captions "Financial Highlights" and "Fund Auditors" and in the Statement of
Additional Information under the caption "Auditor".
McGLADREY & PULLEN, LLP
New York, New York
February 17, 1999
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS INCLUDED IN THE COMPANY'S ANNUAL REPORT AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> WEITZ PARTNERS VALUE FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<INVESTMENTS-AT-COST> 221,832,974
<INVESTMENTS-AT-VALUE> 293,299,520
<RECEIVABLES> 787,901
<ASSETS-OTHER> 5,854,424
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 299,941,845
<PAYABLE-FOR-SECURITIES> 646,068
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,964,296
<TOTAL-LIABILITIES> 7,610,364
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 198,954,601
<SHARES-COMMON-STOCK> 16,538,775
<SHARES-COMMON-PRIOR> 8,654,541
<ACCUMULATED-NII-CURRENT> 695,750
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 22,019,838
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 70,661,292
<NET-ASSETS> 292,331,481
<DIVIDEND-INCOME> 877,691
<INTEREST-INCOME> 2,154,606
<OTHER-INCOME> 0
<EXPENSES-NET> (2,380,813)
<NET-INVESTMENT-INCOME> 651,484
<REALIZED-GAINS-CURRENT> 22,139,768
<APPREC-INCREASE-CURRENT> 25,105,776
<NET-CHANGE-FROM-OPS> 47,897,028
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,206,568)
<DISTRIBUTIONS-OF-GAINS> (15,264,855)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 8,950,496
<NUMBER-OF-SHARES-REDEEMED> (2,006,948)
<SHARES-REINVESTED> 940,686
<NET-CHANGE-IN-ASSETS> 158,594,427
<ACCUMULATED-NII-PRIOR> 1,250,834
<ACCUMULATED-GAINS-PRIOR> 15,144,925
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,905,319
<INTEREST-EXPENSE> 4,964
<GROSS-EXPENSE> 2,380,813
<AVERAGE-NET-ASSETS> 192,302,155
<PER-SHARE-NAV-BEGIN> 15.45
<PER-SHARE-NII> 0.06
<PER-SHARE-GAIN-APPREC> 4.00
<PER-SHARE-DIVIDEND> (0.16)
<PER-SHARE-DISTRIBUTIONS> (1.67)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 17.68
<EXPENSE-RATIO> 1.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
