<PAGE>
As filed with the Securities and Exchange Commission
On April 28, 2000
1933 Act Registration Number 33-66714
1940 Act Registration Number 811-7918
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 7
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 8
Weitz Partners, Inc.
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(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
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(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 April 30, 2000
pursuant to paragraph (b) of Rule 485 under the Securities Act of 1940.
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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,
Semi-annual 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, make inquiries or find additional information about
the Fund as follows:
- - By telephone:
800-232-4161
- - By mail:
Weitz Funds
One Pacific Place, Suite 600
1125 South 103(rd) 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. (800-SEC-0330). Information on
the operation of the Public Reference Room may be obtained by calling the SEC at
800-SEC-0330. Reports and other information about the Fund are available on the
SEC's Internet Site at http://www.sec.gov. 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
513425
WEITZ PARTNERS, INC.
PARTNERS VALUE FUND
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PROSPECTUS
APRIL 30, 2000
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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>
Weitz Partners Value Fund Summary........................... 3
Investment Objective...................................... 3
Summary: Investment Strategies............................ 3
Summary: Related Risks.................................... 3
Fund Performance............................................ 4
Fund Expenses............................................... 5
More About the Partners Value Fund.......................... 6
Investment Objective...................................... 6
Investment Strategies..................................... 6
Related Risks............................................. 6
Purchasing Shares........................................... 8
Opening a Regular New Account............................. 8
Opening a Retirement Account.............................. 8
Purchasing Shares of the Fund............................. 9
Purchasing Through Others................................. 10
Changing Your Address..................................... 10
Confirmations and Shareholder Reports..................... 10
Telephone Communications.................................. 11
Redeeming Shares............................................ 12
Redemption Procedures..................................... 12
Redemption Payments....................................... 12
Signature Guarantees...................................... 13
Other Redemption Information.............................. 13
Exchanging Shares........................................... 14
Pricing of Shares........................................... 15
Distributions and Taxes..................................... 16
Shareholder Distributions................................. 16
Taxation of Distributions................................. 16
Taxation of Sales and Exchanges........................... 16
Buying Shares Prior to a Distribution..................... 16
Management.................................................. 17
Investment Adviser........................................ 17
Portfolio Manager......................................... 17
Fund Distributor.......................................... 17
Additional Information...................................... 18
Code of Ethics............................................ 18
Fund Custodian............................................ 18
Fund Sub-Transfer Agent................................... 18
Fund Auditor.............................................. 18
Fund Legal Counsel........................................ 18
Financial Highlights........................................ 19
</TABLE>
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WEITZ PARTNERS VALUE FUND SUMMARY
INVESTMENT OBJECTIVE
The Fund's primary investment objective is capital appreciation.
SUMMARY: INVESTMENT STRATEGIES
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 considers
long-term capital gains preferable to short-term capital gains and dividend and
interest income, but all such gains and income are desirable. 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."
SUMMARY: RELATED RISKS
An investment in the Fund involves certain risks. 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.
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.
Undervalued 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.
There can be no assurance that the Fund will meet its investment objective.
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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 compared 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.* 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>
CALENDAR YEAR TOTAL RETURNS**
<S> <C>
1990 -6.3%
1991 28.1%
1992 15.1%
1993 23.0%
1994 -9.0%
1995 38.7%
1996 19.2%
1997 40.6%
1998 29.1%
1999 22.1%
The Partners Value Fund's year-to-date return for the three
months ended March 31, 2000 was -1.8%
</TABLE>
During the ten year period shown in the chart above, the highest quarterly
return was 16.6 % (quarter ended March 31, 1998) and the lowest quarterly return
was -10.0% (quarter ended September 30, 1990).
AVERAGE ANNUAL TOTAL RETURNS (FOR PERIODS ENDED DECEMBER 31, 1999)
<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR 5 YEARS 10 YEARS (JUNE 1, 1983)
-------- -------- -------- ---------------
<S> <C> <C> <C> <C>
PARTNERS VALUE FUND** 22.1% 29.6% 18.9% 18.2%
Standard & Poor's 500 Index*** 21.0% 28.5% 18.2% 17.6%
</TABLE>
*The Fund's investment objectives, policies, guidelines and restrictions are
materially equivalent 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.
**Includes performance of the Fund's predecessor entity, Weitz Partners II for
the period June 1, 1983 to December 31, 1993.
***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 .19%
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Total Annual Fund Operating Expenses 1.19%
</TABLE>
<TABLE>
<S> <C> <C>
EXAMPLE
This example is intended to help you compare the cost 1 year $ 121
of investing in the Fund with the cost of investing in 3 years 378
other mutual funds. The example assumes that you 5 years 655
invest $10,000 in the Fund for the time periods 10 years 1,445
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>
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MORE ABOUT THE PARTNERS VALUE FUND
INVESTMENT OBJECTIVE
The Fund's primary investment objective is capital appreciation.
INVESTMENT STRATEGIES
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 convertible or nonconvertible 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.
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 may
invest without limitation in cash or high quality fixed income securities for
temporary defensive purposes. In the event that the Fund takes such a temporary
defensive position, it may not achieve its investment objective during this
temporary period.
RELATED 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
-6-
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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 UNDERVALUED 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.
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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PURCHASING SHARES
OPENING A REGULAR NEW ACCOUNT
You can open a new account by:
- - Completing and signing a Weitz Funds purchase application;
- - Enclosing a check made payable to Weitz Partners, Inc.;
- - Mailing the application and the check to:
BY MAIL:
Weitz Funds
P.O. Box 219320
Kansas City, Missouri 64121-9320
BY CERTIFIED OR OVERNIGHT DELIVERY:
Weitz Funds
c/o National Financial Data Services
330 W. 9th, 4th Floor
Kansas City, Missouri 64105
- - Providing other supporting legal documents that may be required in the case of
estates, trusts, guardianships, custodianships, partnerships, corporations and
certain other accounts.
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 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.
-8-
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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 purchase request in good
order is received on any day prior to such time, your purchase will be the net
asset value calculated on that day. If your purchase request in good order is
received on any day after such time, your purchase price will be 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;
- - Mailing the check and remittance stub to:
BY MAIL:
Weitz Funds
P.O. Box 219320
Kansas City, Missouri 64121-9320
BY CERTIFIED OR OVERNIGHT DELIVERY:
Weitz Funds
c/o National Financial Data Services
330 W. 9th, 4th Floor
Kansas City, Missouri 64105
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 402-391-1980 or 800-304-9745 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:
IFTC
ABA# 101003621
DDA# 8907561075
Weitz Funds Purchase Account
For credit to: Fund 331
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.
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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 1(st) or
15(th) 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. The request must be received at least
15 days prior to an automatic investment date.
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. Weitz & Co. may, from time to time, make payments to broker-
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 Weitz & Co.'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 unless the written request to change an address has been
received by the Fund at least 15 days prior to 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. 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.
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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 semi-annual report will also include unaudited
financial statements. The annual report will include the Fund's audited
financial statements for the previous fiscal year.
To reduce the volume of mail you receive, the Fund will send a single copy of
most financial reports and prospectuses to a shareholder with multiple accounts
(single, retirement, joint, etc.) if such accounts have the same tax
identification number and the same address. You may request that additional
copies be sent by notifying the Weitz Funds.
TELEPHONE COMMUNICATIONS
Telephone conversations may be recorded or monitored for verification,
recordkeeping and quality assurance purposes.
-11-
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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:
BY MAIL:
Weitz Funds
P.O. Box 219320
Kansas City, Missouri 64121-9320
BY CERTIFIED OR OVERNIGHT DELIVERY:
Weitz Funds
c/o National Financial Data Services
330 W. 9th, 4th Floor
Kansas City, Missouri 64105
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 redeemed 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 net 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 800-304-9745 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.
To protect you and the Fund, redemptions from an account are not allowed unless
the written request to change an address has been received by the
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Fund at least 15 days prior to the redemption request.
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.
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.
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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 a Prospectus for that fund by calling 402-391-1980 or 800-232-4161;
- - 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 to
suspend, limit, modify or terminate exchange privileges in order to prevent
transactions considered to be harmful to existing shareholders.
-14-
<PAGE>
- --------------------------------------------------------------------------------
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.
-15-
<PAGE>
- --------------------------------------------------------------------------------
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.
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 an 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.
-16-
<PAGE>
- --------------------------------------------------------------------------------
MANAGEMENT
INVESTMENT ADVISER
Wallace R. Weitz & Company ("Weitz & Co.") 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 pursuant 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.
Weitz & Co. has contracted with National Financial Data Services to serve as a
sub-transfer agent for the Fund.
PORTFOLIO MANAGER
Wallace R. Weitz, a Chartered Financial Analyst, 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 Weitz & Co., the Fund's 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.
-17-
<PAGE>
- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
CODE OF ETHICS
The Fund, Weitz & Co. and Weitz Securities, Inc. 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;
- - Requires all employees to report their personal securities holdings annually;
- - 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. The Fund's Code of
Ethics is on public file with and available from the Securities and Exchange
Commission.
FUND CUSTODIAN
Norwest Bank Minnesota, N.A., Sixth and Marquette, Minneapolis, Minnesota
55479-0001, is the Custodian for the Fund.
FUND SUB-TRANSFER AGENT
National Financial Data Services, Kansas City, Missouri is the Sub-Transfer
Agent for the Fund.
FUND AUDITOR
PricewaterhouseCoopers LLP, 1177 Avenue of the Americas, New York, New York
10036 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.
-18-
<PAGE>
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the Partners
Value Fund's financial performance for the fiscal year ended March 31, 2000 and
the past 5 years. Certain information reflects financial results for a single
fund share. The total returns in the table represent the rate that an investor
would have earned on an investment in the Fund (assuming reinvestment of all
dividends and distributions). The table is part of the Fund's financial
statements, which are included in its annual report and are incorporated by
reference into the Fund's Statement of Additional Information (available upon
request). The financial statements in the annual report were audited by
PricewaterhouseCoopers, LLP, the Fund's independent accountants.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED DECEMBER 31,
MARCH 31, ------------------------------------------------------
2000** 1999 1998 1997 1996 1995
------------- ---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD: $ 20.02 $ 17.68 $ 15.45 $ 11.52 $ 10.38 $ 8.28
-------- -------- -------- -------- -------- --------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income 0.08 0.21 0.06 0.13 0.06 0.08
Net gains or losses on securities
(realized and unrealized) (0.43) 3.42 4.00 4.33 1.93 3.11
-------- -------- -------- -------- -------- --------
Total from investment operations (0.35) 3.63 4.06 4.46 1.99 3.19
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income (0.20) (0.05) (0.16) -- (0.06) (0.24)
Distributions from realized gains (0.72) (1.24) (1.67) (0.53) (0.79) (0.85)
-------- -------- -------- -------- -------- --------
Total distributions (0.92) (1.29) (1.83) (0.53) (0.85) (1.09)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 18.75 $ 20.02 $ 17.68 $ 15.45 $ 11.52 $ 10.38
======== ======== ======== ======== ======== ========
TOTAL RETURN (1.8%)+ 22.1% 29.1% 40.6% 19.2% 38.7%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period ($000) 1,241,628 1,143,374 292,331 133,737 94,846 73,781
Ratio of expenses to average net
assets 1.19%* 1.24% 1.25% 1.24% 1.23% 1.27%
Ratio of net investment income to
average net assets 1.77%* 1.57% 0.34% 1.11% 0.51% 0.82%
Portfolio turnover rate 5% 29% 36% 30% 37% 51%
</TABLE>
* Annualized
+ Not Annualized
** In the current period, the Fund changed its fiscal year end from December 31
to March 31.
-19-
<PAGE>
- --------------------------------------------------------------------------------
<PAGE>
WEITZ PARTNERS, INC.
PARTNERS VALUE FUND
---------------------------------
STATEMENT OF ADDITIONAL INFORMATION
APRIL 30, 2000
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, 2000. The Fund's financial statements for the period ended March 31,
2000 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............................................ 11
Principal Holders of Securities........................................ 12
Investment Advisory and Other Services................................. 13
Investment Adviser and Distributor............................ 13
Administrator................................................. 13
Sub-Transfer Agent............................................ 14
Custodian..................................................... 14
Auditor....................................................... 14
Legal Counsel................................................. 14
Portfolio Transactions and Brokerage Allocation........................ 14
Organization and Capital Structure..................................... 16
General....................................................... 16
Shareholder Meetings.......................................... 16
Purchasing Shares...................................................... 17
Pricing of Shares...................................................... 17
Redemption of Shares................................................... 18
Taxation............................................................... 18
Calculation of Performance Data........................................ 19
Financial Statements................................................... 20
Appendix A............................................................. 21
</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 materially equivalent 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
convertible or nonconvertible 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 asset 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.
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,
3
<PAGE>
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 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
4
<PAGE>
capital appreciation. Such convertible or nonconvertible securities may or may
not be rated investment grade or may be unrated. The Fund will not invest more
than 15% of its assets in securities that are non-investment grade or unrated.
Generally investment grade securities are those with a rating of BBB or better
by Standard and Poor's or Baa or better by Moody's. 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 & Poor's and Moody's 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,
1999. 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 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
5
<PAGE>
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 net 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.
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
6
<PAGE>
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 & Poor's, or (b) if
not rated, issued by or guaranteed by companies which have an outstanding debt
issue rated AA or better by Standard & Poor's or Aa or better by Moody's. See
Appendix A for a description of ratings.
WHEN ISSUED OR FORWARD COMMITMENT TRANSACTIONS The Fund may engage in when
issued or forward commitment transactions which involve the purchase or sale of
a security by the Fund with payment and delivery taking place in the future to
secure what is considered an advantageous yield and price to the Fund at the
time of entering into the transaction. To the extent the Fund enters into such
forward commitments, it will maintain a segregated account with the Custodian
with an aggregate value equal to the amount of its commitment in connection with
such purchase transactions.
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 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
7
<PAGE>
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.
8
<PAGE>
10. Invest more than 25% of the value of its net assets in the securities of
any one industry.
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 "Investment Objective and Strategy."
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 fiscal period ended March 31, 2000, and
the fiscal years ended December 31, 1999 and December 31, 1998, was 5%, 29% and
36%, 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 registered
President, Treasurer investment adviser, since July, 1983; President, Weitz
And Director Securities, Inc. a registered broker-dealer, since January,
Age: 51 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 Partner, The Public Strategies Group (consultant to
Director government and non-profit organizations on organizational
Age: 49 change) since 1999; Independent consultant 1995-1998;
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 accountants) since
Director its inception in 1985; Director, Weitz Series Fund, Inc.,
Age: 52 since 1990; Director, Weitz Value Fund, Inc., January, 1986
until March, 1990; Senior Tax Manager, Peat, Marwick,
Mitchell & Co., Omaha, Nebraska (1978-1985)
10
<PAGE>
Richard D. Holland Prior to his retirement in 1984, Mr. Holland was Vice
Director Chairman of Rollheiser, Holland & Kahler, an advertising
Age: 79 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, attorneys, since
Director 1973; Director, Weitz Series Fund, Inc. since 1990; Director,
Age: 55 Weitz Value Fund, Inc., January, 1986 until March, 1990
Delmer L. Toebben Prior to his retirement in 1999, Mr. Toebben was President of
Director Curzon Advertising & Display, Inc. (1977-1999); Director,
Age: 69 Weitz Series Fund, Inc. since July of 1996
Mary K. Beerling Vice President, Wallace R. Weitz & Company since July of
Vice President and 1994; Vice President, Weitz Securities, Inc. since July of
Secretary 1994; Partner, Kutak Rock, attorneys, from 1989 to 1994
Age: 59
Linda L. Lawson Vice President, Wallace R. Weitz & Company since June of
Vice President 1992; Manager, Marketing Financial Management, Mutual of
Age: 46 Omaha (1988-1992)
Linda Lawson is the sister of Richard F. Lawson.
Richard F. Lawson Vice President, Wallace R. Weitz & Company since December of
Vice President and 1992 and a financial analyst since January of 1991; Portfolio
Assistant Secretary Manager, Hickory Portfolio of Weitz Series Fund, Inc. since
Age: 42 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.
COMPENSATION TABLE
The table below includes certain information with respect to compensation of all
directors of the Fund for the fiscal period ended March 31, 2000 and the fiscal
year ended December 31, 1999. Compensation of the officers of the Fund is paid
by the investment adviser.
11
<PAGE>
<TABLE>
<CAPTION>
PERIOD ENDED PERIOD ENDED
MARCH 31, 2000 DECEMBER 31, 1999
----------------------------------------- ----------------------------------------
AGGREGATE TOTAL COMPENSATION AGGREGATE TOTAL COMPENSATION
COMPENSATION FROM COMPANY AND COMPENSATION FROM COMPANY AND
FROM THE WEITZ SERIES FUND, INC. FROM THE WEITZ SERIES FUND, INC.
NAME OF PERSON, POSITION COMPANY PAID TO DIRECTORS COMPANY PAID TO DIRECTORS
- ------------------------ ------- ----------------- ------- -----------------
<S> <C> <C> <C> <C>
Lorraine Chang, Director $2,278 $7,500 $1,200 $6,000
John W. Hancock, Director 2,278 7,500 1,440 6,400
Richard D. Holland, Director 2,278 7,500 1,240 5,400
Thomas R. Pansing Jr., Director 1,778 7,000 1,200 6,000
Delmer L. Toebben, Director 1,270 5,000 1,040 5,200
Wallace R. Weitz, Director(1) 0 0 0 0
</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.
PRINCIPAL HOLDERS OF SECURITIES
On March 31, 2000, the Fund had 66,211,926 shares of its common stock
outstanding. As of that date the directors and officers of the Fund collectively
owned 349,649 shares which represented approximately .5% 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>
Charles Schwab & Co., Inc. 22,400,015 33.8%
Special Custody Acct for the
Benefit of Customers
ATTN MUTUAL FUNDS
101 Montgomery Street
San Francisco, CA 94104
National Financial Services 9,225,981 13.9%
Corp. for the Exclusive
Benefit of our Customers
ATTN MUTUAL FUNDS DEPT
200 Liberty Street
1 World Financial Center
New York, NY 10281
12
<PAGE>
<CAPTION>
NAME AND ADDRESS SHARES/NATURE OF OWNERSHIP PERCENT OWNED
- ---------------- -------------------------- -------------
<S> <C> <C>
The Manufacturer's Life Ins. Co. USA 6,455,955 9.7%
Attn: US SRS Seg Fnds Accting
250 Bloor St. E., 7th Floor
Toronto, Ontario
Canada M4W1E5
</TABLE>
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 period ended March 31, 2000 and the fiscal years ended December 31,
1999, 1998 and 1997 was $2,873,594, $7,343,521, $1,905,319 and $1,124,589,
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.
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<PAGE>
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.
ADMINISTRATOR
Wallace R. Weitz & Company is also the administrator for the Funds in accordance
with an administration agreement with the Company. Under the agreement,
effective March 1, 2000, the Fund pays the administrator a monthly fee equal, on
an annual basis, the following amounts, based on total assets of the Fund:
ASSET BREAK POINTS
<TABLE>
<CAPTION>
GREATER THAN LESS THAN % OF NAV MINIMUM
------------ --------- -------- -------
<S> <C> <C> <C>
$0 $25,000,000 0.200% $25,000
25,000,000 100,000,000 0.175%
100,000,000 500,000,000 0.150%
500,000,000 0.050%
</TABLE>
In no event will the fee be less than $25,000 per year. 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 period ended March 31, 2000 and the
fiscal years ended December 31, 1999, 1998 and 1997 was $377,611, $1,101,528,
$276,929 and $126,978, respectively.
SUB-TRANSFER AGENT
Wallace R. Weitz & Company has contracted with National Financial Data Services,
Inc. to serve as a sub-transfer agent for the Funds.
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 PricewaterhouseCoopers, 1177 Avenue of the
Americas, New York, New York 10036. 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.
14
<PAGE>
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 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
15
<PAGE>
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.
During the fiscal period ended March 31, 2000 and the fiscal years ended
December 31, 1999, 1998 and 1997, the Fund paid $776,100, $2,254,819, $770,557
and $246,365, 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, 1999, 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. One hundred 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
16
<PAGE>
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
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. All
purchase orders are subject to acceptance by authorized officers of the Fund and
are not binding until so accepted. 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.
The Fund has authorized one or more brokers or other financial intermediaries to
accept on its behalf purchase and redemption orders. Such brokers or financial
intermediaries are authorized to designate other intermediaries to accept
purchase and redemption orders on behalf of the Fund. The Fund will be deemed to
have received a purchase or redemption order when an authorized intermediary or,
if applicable, an intermediary's authorized designee, accepts the order. A
shareholder's order will be priced at the net asset value of the Fund next
computed after such order is accepted by an authorized broker or the broker's
authorized designee.
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:
17
<PAGE>
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
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
18
<PAGE>
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 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
19
<PAGE>
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 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 materially equivalent 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, 1999 and for the period from
inception (June 1, 1983) to December 31, 1999, was 22.1%, 29.6%, 18.9% and
18.2%, respectively. Cumulative total return for the Fund and the Predecessor
Partnership from inception (June 1, 1983) to December 31, 1999, was 1504.5%. The
average annual total return for the Fund and the Predecessor Partnership for the
one, five and ten year periods ended March 31, 2000 and for the period since
inception (June 1, 1983) to March 31, 2000, was 10.9%, 27.0%, 19.3% and 17.8%,
respectively. Cumulative total return for the Fund and the Predecessor
Partnership from inception (June 1, 1983) to March 31, 2000, was 1476.2%. 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 March 31, 2000 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.
20
<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.
Ca: Bonds rated Ca represent obligations which are speculative in a
high degree. Such bonds are often in default or have other marked shortcomings.
21
<PAGE>
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 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.
22
<PAGE>
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
23
<PAGE>
PART C
OTHER INFORMATION
Item 23. Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
*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 PricewaterhouseCoopers, LLP and McGladrey & Pullen, LLP
*13. Subscription Agreement of Wallace R. Weitz
14. Code of Ethics - Weitz Partners, Inc., Weitz Series Fund, Inc., Wallace R.
Weitz & Company and Weitz Securities, Inc.
</TABLE>
* 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.
<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 has 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 the 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 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
C-2
<PAGE>
act or omission which violates a declaratory or injunctive order obtained by the
Registrant or its shareholders.
Item 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
<TABLE>
<CAPTION>
Principal Occupation
Positions with (Present and for
Name Adviser Past Two Years)
---- ------- ---------------
<S> <C> <C>
Wallace R. Weitz President, Treasurer and See caption "Management" in the Statement of Additional
Director Information forming a part of this Registration Statement
Barbara V. Weitz Secretary and Director Faculty Member, University of Nebraska at Omaha
Mary K. Beerling Vice President and See caption "Management" in the Statement of Additional
Assistant Secretary 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
</TABLE>
C-3
<PAGE>
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.
(b) Directors and Officers:
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address with Registrant with Underwriter
---------------- --------------- ----------------
<S> <C> <C>
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
</TABLE>
(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.
C-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, the Registrant has duly caused this 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 28th day of April, 2000. By execution hereof, the undersigned hereby
certifies that this Post-Effective Amendment meets all the requirements for
effectiveness under Rule 485(b) of the Securities Act of 1933.
WEITZ PARTNERS, INC.
By: /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 April 28, 2000:
Signature Title
--------- -----
/s/ Wallace R. Weitz President, Principal Executive Officer,
- ----------------------------- Principal Financial and Accounting Officer
Wallace R. Weitz and Director
/s/ John W. Hancock* Director
- -----------------------------
John W. Hancock
/s/ Richard D. Holland* Director /s/ Wallace R. Weitz
- ------------------------- --------------------
Richard D. Holland Wallace R. Weitz
Attorney-in-fact
/s/ Thomas R. Pansing, Jr.* Director
- -----------------------------
Thomas R. Pansing, Jr.
/s/ Delmer L. Toebben* Director
- -----------------------------
Delmer L. Toebben
/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.
C-5
<PAGE>
Exhibits
To
Weitz Partners, Inc.
Post-Effective Amendment Number 7
To
Form N-1A
as filed on April 28, 2000
<PAGE>
EXHIBITS
Exhibit No. Description
- ----------- -----------
2. Amended and Restated Bylaws
9. Amended and Restated Administration Agreement
11. Consents of PricewaterhouseCoopers, LLP and McGladrey &
Pullen, LLP
14. Code of Ethics - Weitz Partners, Inc., Weitz Series Fund, Inc.,
Wallace R. Weitz & Company and Weitz Securities, Inc.
<PAGE>
EXHIBIT 2
Amended and Restated Bylaws
<PAGE>
AMENDED AND RESTATED BYLAWS
OF
WEITZ PARTNERS, INC.
ARTICLE I
OFFICERS, CORPORATE SEAL
Section 1.01. NAME. The name of the corporation is WEITZ PARTNERS, INC.
Section 1.02. REGISTERED OFFICE. The registered office of the corporation
in Nebraska shall be that set forth in the Articles of Incorporation or in the
most recent amendment of the Articles of Incorporation or resolution of the
directors filed with the Secretary of State of Nebraska changing the registered
office.
Section 1.03. OTHER OFFICES. The corporation's office in Nebraska shall be
1125 South 103rd Street, Suite 600, Omaha, Nebraska, and the corporation may
have such other offices and places of business, within or without the State of
Minnesota, as the directors shall, from time to time, determine.
Section 1.04. CORPORATE SEAL. The corporation shall have no seal.
ARTICLE II
MEETINGS OF SHAREHOLDERS
Section 2.01. PLACE AND TIME OF MEETINGS. Meetings of the shareholders may
be held at any place, within or without the State of Nebraska, designated by the
directors and, in the absence of such designation, shall be held at the
registered office of the corporation in the State of Nebraska. The directors
shall designate the time of day for each meeting and, in the absence of such
designation, every meeting of shareholders shall be held at 10:00 o'clock a.m.
Section 2.02. REGULAR MEETINGS. Annual meetings of shareholders will not be
held unless called by the shareholders pursuant to the Nebraska Business
Corporation Act unless required by the Investment Company Act of 1940 and the
rules and regulations promulgated thereunder.
Section 2.03. SPECIAL MEETINGS. Special meetings of the shareholders may be
held at any time and for any purpose and may be called by the Chairperson of the
Board, the President, and two or more directors, or by one or more shareholders
holding ten percent (10%) or more of the shares entitled to vote on the matters
presented to the meeting.
Section 2.04. QUORUM; ADJOURNED MEETINGS. The holders of a majority of the
shares outstanding and entitled to vote at a meeting shall constitute a quorum
for the transaction of business at any shareholders' meeting unless otherwise
required by the Nebraska Business
1
<PAGE>
Corporation Act or by the Investment Company Act of 1940. In case a quorum shall
not be present at a meeting, those present in person or by proxy shall adjourn
to such day as they shall, by majority vote, agree upon without further notice
other than by announcement at the meeting at which such adjournment is taken. If
a quorum is present, a meeting may be adjourned from time to time without notice
other than announcement at the meeting. At adjourned meetings at which a quorum
is present, any business may be transacted which might have been transacted at
the meeting as originally noticed. If a quorum is present, the shareholders may
continue to transact business until adjournment notwithstanding the withdrawal
of enough shareholders to leave less than a quorum.
Section 2.05. VOTING. At each meeting of the shareholders, every
shareholder shall have the right to vote in person or by proxy. Each
shareholder, unless the Articles of Incorporation or applicable laws provide
otherwise, shall have one vote for each share having voting power registered in
his/her name on the books of the corporation. Upon the demand of any
shareholder, the vote upon any question before the meeting shall be by written
ballot. Except as otherwise specifically provided by these Bylaws or as required
by provisions of the Investment Company Act of 1940 or other applicable laws,
all questions shall be decided by a majority vote of the number of shares
entitled to vote and represented at the meeting at the time of the vote. If the
matter(s) to be presented at a regular or special meeting relates only to a
particular portfolio or portfolios of the corporation, then only the
shareholders of the series of stock issued by such portfolio or portfolios are
entitled to vote on such matter(s).
Section 2.06. VOTING - PROXIES. The right to vote by proxy shall exist only
if the instrument authorizing such proxy to act shall have been executed in
writing by the shareholder himself or by his/her attorney thereunto duly
authorized in writing. No proxy shall be voted after three years from its date
unless it provides for a longer period.
Section 2.07. CLOSING OF BOOKS. The Board of Directors may fix a time, not
exceeding fifty (50) days preceding the date of any meeting of shareholders, as
a record date for the determination of the shareholders entitled to notice of,
and to vote at, such meeting, notwithstanding any transfer of shares on the
books of the corporation after any record date so fixed. If the Board of
Directors fails to fix a record date for determination of the shareholders
entitled to notice of, and to vote at, any meeting of shareholders, the record
date shall be the thirtieth (30th) day preceding the date of such meeting.
Section 2.08. NOTICE OF MEETINGS. The Secretary or an Assistant Secretary
shall mail to each shareholder, shown by the books of the corporation to be a
holder of record of voting shares, at his/her address as shown by the books of
the corporation, a notice setting out the time and date and place of any
shareholders' meeting, which notice shall be mailed at least ten (10) days and
not more than fifty (50) days prior thereto. Every notice of any shareholders'
meeting shall state the purpose or purposes for which the meeting has been
called, pursuant to Section 2.03, and the business transacted at all meetings
shall be confined to the purpose stated in the call.
2
<PAGE>
Section 2.09. WAIVER OF NOTICE. Notice of any meeting may be waived either
before, at or after such meeting in writing signed by each shareholder or
representative thereof entitled to vote the shares so represented.
Section 2.10. WRITTEN ACTION. Any action which might be taken at a meeting
of the shareholders may be taken without a meeting if done in writing and signed
by a majority of the shareholders entitled to vote on that action. If the action
to be taken relates to a particular portfolio or portfolios of the corporation,
then only shareholders of the series of stock issued by such portfolio or
portfolios are entitled to vote on such action.
ARTICLE III
BOARD OF DIRECTORS
Section 3.01. NUMBER AND TENURE OF OFFICE. The business of the corporation
shall be conducted by and its property managed by a Board of Directors
consisting of no less than three (3) nor more than seven (7) directors, which
number may be increased or decreased as provided in Section 3.03 of this
Article. Each director shall hold office until the next meeting of stockholders
of the corporation next succeeding his/her election or until his/her successor
is duly elected and qualified. Directors need not be stockholders.
The Board of Directors may elect a Chairperson, who shall preside at
meetings and shall have such other responsibilities and duties as may be
requested of or assigned to him by the Board.
Section 3.02. VACANCIES. In case of any vacancy in the Board of Directors
through death, resignation or other cause, a majority of the remaining
directors, although such majority is less than a quorum, by an affirmative vote,
may, subject to any limitations contained in the Articles of Incorporation, or
the Investment Company Act of 1940, elect a successor to hold office until the
next annual meeting of the stockholders of the corporation or until his/her
successor is duly elected and qualified.
Section 3.03. INCREASE OR DECREASE IN NUMBER OF DIRECTORS. Subject to any
limitations contained in the Articles of Incorporation, the Board of Directors,
by the vote of a majority of the entire Board, may increase the number of
directors, and any vacancies so created shall be filled by the stockholders at
the next meeting of stockholders called for that purpose. Subject to the said
limitations, the Board of Directors, by the vote of a majority of the entire
Board, may likewise decrease the number of directors to a number not less than
three.
Section 3.04. ELECTION OF ENTIRE NEW BOARD. The Board of Directors shall be
elected by the holders of the outstanding voting securities of the corporation;
provided, however, that vacancies occurring between shareholder meetings may be
filled in accordance with the provisions of Section 16(a) of the Investment
Company Act of 1940.
Section 3.05. PLACE OF MEETINGS, OFFICE AND RECORDS. The directors may hold
their meetings, have one or more offices and keep the books of the corporation
outside the State of Nebraska at any office or offices of the corporation or at
any other place as they may from time to
3
<PAGE>
time by resolution determine, or, in the case of meetings, as shall be specified
or fixed in the respective notices or waivers of notice thereof.
Section 3.06. REGULAR MEETINGS. Regular meetings of the Board of Directors
shall be held quarterly at such time and on such notice as the directors may
from time to time determine.
A meeting of the Board of Directors shall be held immediately after a
meeting of the stockholders called for the election of directors. Said meeting
shall be held at the same place as the stockholders' meeting. No notice of such
meeting of the Board of Directors is required.
Section 3.07. SPECIAL MEETINGS. Special meetings of the Board of Directors
may be held from time to time upon call of the President or of a majority of the
directors by oral or telegraphic or written notice duly served on or sent or
mailed to each director not less than two (2) days before such meeting. No
notice need be given to any director who attends in person or to any director
who, in writing executed and filed with the records of the meeting either before
or after the holding thereof, waives such notice. Such notice or waiver of
notice need not state the purpose or purposes of such meeting.
Section 3.08. QUORUM. A majority of the directors shall constitute a quorum
for the transaction of business, provided that a quorum shall in no case be less
than two directors. If at any meeting of the Board there shall be less than a
quorum present, a majority of those present may adjourn the meeting from time to
time until a quorum shall have been obtained. The act of the majority of the
directors present at any meeting at which there is a quorum shall be the act of
the directors, except as otherwise provided in the Articles of Incorporation or
in these Bylaws, or by specific statutory provisions superseding the
restrictions and limitations in the Articles of Incorporation or in these
Bylaws, or any contract or agreement to which the corporation is a party.
Section 3.09. EXECUTIVE COMMITTEE. The Board of Directors may, in each
year, by the affirmative vote of a majority of the entire Board, elect from the
directors an Executive Committee to consist of such number of directors (not
less than two) as the Board may from time to time determine. The Chairperson of
the Committee shall be elected by the Board of Directors. The Board of Directors
by affirmative vote shall have power at any time to change the members of such
Committee and may fill vacancies in the Committee by election from the
directors. When the Board of Directors is not in session, the Executive
Committee shall have and may exercise any or all of the powers of the Board of
Directors in the management of the business and affairs of the corporation
except as provided by law or by any contract or agreement to which the
corporation is a party and except the power to increase or decrease the size of,
or fill vacancies on, the Board, to remove or appoint executive officers or to
dissolve, or change the membership of, the Executive Committee, and the power to
make or amend the Bylaws of the corporation. The Executive Committee may fix its
own rules for the conduct of its business or such rules may be established by
resolution of the Board of Directors, but in every case the presence of a
majority shall be necessary to constitute a quorum. In the absence of any member
of the Executive Committee, the members thereof present at any meeting, whether
or not they constitute a quorum, may appoint a member of the Board of Directors
to act in the place of such absent member.
4
<PAGE>
Section 3.10. INVESTMENT COMMITTEE. The Board of Directors may appoint an
Investment Committee, consisting of three or more members, all of whom shall be
members of the Board of Directors. The Board of Directors may remove any member
and may appoint new alternate or additional members of the Investment Committee,
and may request persons who are not directors to serve as ex officio members. It
shall be the function of the Investment Committee to advise the Board of
Directors as to the investment of the assets of the corporation. The Investment
Committee shall have no power or authority to make any contract or incur any
liability whatever or to take any action binding upon the corporation, the
officers, the Board of Directors or the stockholders.
Section 3.11. OTHER COMMITTEES. The Board of Directors, by the affirmative
vote of a majority of the entire Board, may appoint other committees which shall
in each case consist of such number of members (not less than two) who are
members of the Board of Directors and shall have and may exercise such powers as
the Board may determine in the resolution appointing them. A majority of all
members of any such committee may determine its action and fix the time and
place of its meeting, unless the Board of Directors shall otherwise provide. The
Board shall have power at any time to change the members and powers of any such
committee, to fill vacancies, and to discharge any such committee, or to request
persons who are not directors to serve as ex officio members thereof.
Section 3.12. ACTION BY CONSENT. Unless otherwise provided by the Articles
of Incorporation or Bylaws, or by the Investment Company Act of 1940 or rules or
regulations promulgated thereunder, any action required by statute to be taken
at a meeting of the directors, or of any committee, may be taken without a
meeting, if a consent in writing setting forth the action so taken shall be
signed by all of the directors or all of the members of the committee, as the
case may be. Such consent shall have the same effect as a unanimous vote. The
consent may be executed by the directors in counterparts.
Members of the Board of Directors, or any committee designated by the
Board, may participate in a meeting of the Board or such committee by conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in a meeting
pursuant to this provision shall constitute presence in person at such meeting.
Section 3.13. COMPENSATION OF DIRECTORS. Directors who are also officers or
employees of the corporation's investment adviser or principal underwriter,
shall take no compensation and expenses for the attendance at a meeting. Other
directors shall receive such compensation and reimbursement for expenses as
shall be fixed by the Board of Directors.
Section 3.14. REMOVAL OF DIRECTORS. Any or all of the Directors of the
corporation may be removed without cause if the removal is approved by a vote of
the holders of a majority of the shares then entitled to vote at an election of
Directors provided, however, that no Director may be removed (unless the entire
Board is removed) when the votes cast against such removal, or not consenting in
writing to the removal, would be sufficient to elect the Director if voted
cumulatively at an election at which the same total number of votes were cast
(or, if the action is taken by written consent, all shares entitled to vote were
voted) and the entire number of
5
<PAGE>
Directors authorized at the time of the Directors' most recent election were
then being elected. Whenever the Articles of Incorporation of the Corporation
provide that the holders of the shares of any class or series, voting as a class
or series, are entitled to elect one or more Directors, any director so elected
may be removed only by the applicable vote of the holders of the shares of that
class or series.
ARTICLE IV
OFFICERS
Section 4.01. NUMBER. The officers of the corporation shall consist of a
Chairperson of the Board (if one is elected by the Board), the President, one or
more Vice Presidents (if desired by the Board), a Secretary and one or more
Assistant Secretaries, a Treasurer and one or more Assistant Treasurers, and
such other officers and agents as may, from time to time, be elected by the
Board of Directors. Any two offices except those of Chairperson of the Board,
President and Vice President may be held by one person.
Section 4.02. ELECTION, TERM OF OFFICE AND QUALIFICATIONS. At each annual
meeting of the Board of Directors, the Board shall elect, from within or without
their number, the President, the Secretary, the Treasurer and such other
officers as may be deemed advisable. Such officers shall hold office until the
next annual meeting of the directors or until their successors are elected and
qualify. The President and all other officers who may be directors shall
continue to hold office until the election and qualification of their
successors, notwithstanding an earlier termination of their directorship.
Section 4.03. RESIGNATION. Any officer may resign his/her office at any
time by delivering a written resignation to the Board of Directors, the
President, the Secretary, or any Assistant Secretary. Unless otherwise specified
therein, such resignation shall take effect upon delivery.
Section 4.04. REMOVAL AND VACANCIES. Any officer may be removed from
his/her office by a majority of the whole Board of Directors, with or without
cause. Such removal, however, shall be without prejudice to the contract rights
of the person so removed. If there be a vacancy among the officers of the
corporation by reason of death, resignation or otherwise, such vacancy shall be
filled for the unexpired term by the Board of Directors.
Section 4.05. CHAIRPERSON OF THE BOARD. The Chairperson of the Board, if
one is elected, shall preside at all meetings of the shareholders and directors
and shall have such other duties as may be prescribed, from time to time, by the
Board of Directors.
Section 4.06. PRESIDENT. The President shall have general active management
of the business of the corporation. In the absence of the Chairperson of the
Board, he/she shall preside at all meetings of the shareholders and directors.
He/she shall be the chief executive officer of the corporation and shall see
that all orders and resolutions of the Board of Directors are carried into
effect. He/she shall be ex officio a member of all standing committees. He/she
may execute and deliver, in the name of the corporation, any deeds, mortgages,
bonds, contracts or other
6
<PAGE>
instruments pertaining to the business of the corporation and, in general,
shall perform all duties usually incident to the office of President. He/she
shall have such other duties as may, from time to time, be prescribed by the
Board of Directors.
Section 4.07. VICE PRESIDENT. Each Vice President shall have such powers
and shall perform such duties as may be specified in the Bylaws or prescribed by
the Board of Directors or by the President. In the event of absence or
disability of the President, Vice Presidents shall succeed to his/her power and
duties in the order designated by the Board of Directors.
Section 4.08. SECRETARY. The Secretary shall be secretary of, and shall
attend all, meetings of the shareholders and Board of Directors and shall record
all proceedings of such meetings in the minute book of the corporation. He/she
shall give proper notice of meetings of shareholders and directors. He/she shall
perform such other duties as may, from time to time, be prescribed by the Board
of Directors or by the President.
Section 4.09. TREASURER. The Treasurer shall keep accurate accounts of all
moneys of the corporation received or disbursed. He/she shall deposit all
moneys, drafts and checks in the name of, and to the credit of, the corporation
in such banks and depositories as a majority of the whole Board of Directors
shall, from time to time designate. He/she shall have power to endorse, for
deposit, all notes, checks and drafts received by the corporation. He/she shall
disburse the funds of the corporation, as ordered by the Board of Directors,
making proper vouchers therefor. He/she shall render to the President and the
directors, whenever required, an account of all his/her transactions as
Treasurer and of the financial condition of the corporation, and shall perform
such other duties as may, from time to time, be prescribed by the Board of
Directors or by the President.
Section 4.10. ASSISTANT SECRETARIES. At the request of the Secretary, or in
his/her absence or disability, any Assistant Secretary shall have power to
perform all the duties of the Secretary and, when so acting, shall have all the
powers of, and be subject to all restrictions upon, the Secretary. The Assistant
Secretaries shall perform such other duties as from time to time may be assigned
to them by the Board of Directors or the President.
Section 4.11. ASSISTANT TREASURERS. At the request of the Treasurer, or in
his/her absence or disability, any Assistant Treasurer shall have power to
perform all the duties of the Treasurer, and when so acting, shall have all the
powers of, and be subject to all the restrictions upon, the Treasurer. The
Assistant Treasurers shall perform such other duties as from time to time may be
assigned to them by the Board of Directors or the President.
Section 4.12. COMPENSATION. The officers of this corporation shall receive
such compensation for their services as may be determined, from time to time, by
resolution of the Board of Directors.
Section 4.13. SURETY BONDS. The Board of Directors may require any officer
or agent of the corporation to execute a bond (including, without limitation,
any bond required by the Investment Company Act of 1940 and the rules and
regulations of the Securities and Exchange Commission) to the corporation in
such sum and with such surety or sureties as the Board of
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Directors may determine, conditioned upon the faithful performance of his/her
duties to the corporation, including responsibility for negligence and for the
accounting of any of the corporation's property, funds or securities that may
come into his/her hands. In any such case, a new bond of like character shall be
given at least every six years, so that the date of the new bond shall not be
more than six years subsequent to the date of the bond immediately preceding.
ARTICLE V
SHARES AND THEIR TRANSFER AND REDEMPTION
Section 5.01. CERTIFICATES FOR SHARES.
(a) Shares issued by the corporation shall be uncertificated.
Section 5.02. ISSUANCE OF SHARES. The Board of Directors is authorized to
cause to be issued shares of the corporation up to the full amount authorized by
the Articles of Incorporation in such series and in such amounts as may be
determined by the Board of Directors and as may be permitted by law. No shares
shall be allotted except in consideration of cash or property, including
securities valued in accordance with procedures adopted by the Board of
Directors. At the time of such allotment of shares, the Board of Directors
making such allotments shall state, by resolution, their determination of the
fair value to the corporation in monetary terms of any consideration other than
cash for which shares are allotted. No shares of stock issued by the corporation
shall be issued, sold, or exchanged by or on behalf of the corporation for any
amount less than the net asset value per share of the shares outstanding as
determined pursuant to Article X hereunder.
Section 5.03. REDEMPTION OF SHARES. Upon the demand of any shareholder this
corporation shall redeem any share of stock issued by it held and owned by such
shareholder at the net asset value thereof as determined pursuant to Article X
hereunder. The Board of Directors may suspend the right of redemption or
postpone the date of payment during any period when: (a) trading on the New York
Stock Exchange is restricted or such Exchange is closed for other than weekends
or holidays; (b) the Securities and Exchange Commission has by order permitted
such suspension; or (c) an emergency as defined by rules of the Securities and
Exchange Commission exists, making disposal of portfolio securities or valuation
of net assets of the corporation not reasonably practicable.
Section 5.04. TRANSFER OF SHARES. Transfer of shares on the books of
the corporation may be authorized only by the shareholder named on the books of
the corporation in the case of uncertificated shares or in the certificate in
the case of certificated shares, or the shareholder's legal representative, or
the shareholder's duly authorized attorney-in-fact, and, in the case of
certificated shares, upon surrender of the certificate or the certificates for
such shares or a duly executed assignment covering shares held in uncertificated
form. The corporation may treat, as the absolute owner of shares of the
corporation, the person or persons in whose name shares are registered on the
books of the corporation.
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Section 5.05. REGISTERED SHAREHOLDERS. The corporation shall be entitled to
treat the holder of record of any share or shares of stock as the holder in fact
thereof and accordingly shall not be bound to recognize any equitable or other
claim to or interest in such share on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise expressly
provided by the laws of Nebraska.
Section 5.06. TRANSFER AGENTS AND REGISTRARS. The Board of Directors may
from time to time appoint or remove transfer agents and/or registrars of
transfers of shares of stock of the corporation, and it may appoint the same
person as both transfer agent and registrar. Upon any such appointment being
made all certificates representing shares of capital stock thereafter issued
shall be countersigned by one of such transfer agents or by one of such
registrars of transfers or by both and shall not be valid unless so
countersigned. If the same person shall be both transfer agent and registrar,
only one countersignature by such person shall be required.
Section 5.07. TRANSFER REGULATIONS. The shares of stock of the corporation
may be freely transferred, and the Board of Directors may from time to time
adopt rules and regulations with reference to the method of transfer of the
shares of stock of the corporation.
ARTICLE VI
DIVIDENDS
It shall be the policy of the corporation to distribute to its
shareholders, at least annually, sufficient net investment income and realized
capital gains in order to comply with the provisions of the United States
Internal Revenue Code which relieve investment companies from Federal Income
Tax. The Board of Directors may provide to the shareholders a plan for
reinvesting such net investment income and capital gains under such terms and
conditions as they, in their discretion, shall deem desirable.
ARTICLE VII
BOOKS AND RECORDS, AUDIT, FISCAL YEAR
Section 7.01. BOOKS AND RECORDS. The Board of Directors of the corporation
shall cause to be kept:
(1) a share register, giving the names and addresses of the shareholders,
the number and classes held by each, and the dates on which the shares
were issued;
(2) records of all proceedings of shareholders and directors; and
(3) such other records and books of account as shall be necessary and
appropriate to the conduct of the corporate business.
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Section 7.02. DOCUMENTS KEPT AT REGISTERED OFFICE. The Board of Directors
shall cause to be kept at the registered office of the corporation originals or
copies of:
(1) records of all proceedings of the shareholders and directors;
(2) Bylaws of the corporation and all amendments thereto; and
(3) reports made to any or all of the shareholders within the last
preceding three (3) years.
Section 7.03. AUDIT, ACCOUNTANT.
(a) The Board of Directors shall cause the records and books of account of
the corporation to be audited at least once in each fiscal year and at such
other times as it may deem necessary or appropriate.
(b) The corporation shall employ an independent certified public accountant
or firm of independent certified public accountants as its Accountant to examine
the accounts of the corporation and to sign and certify financial statements
filed by the corporation. The Accountant's certificates and reports shall be
addressed both to the Board of Directors and to the shareholders.
(c) A majority of the members of the Board of Directors shall select the
Accountant at any meeting held before the first regular meeting of shareholders,
and thereafter shall select the Accountant annually in accordance with the
requirements of the Investment Company Act of 1940 and the regulations
promulgated thereunder. Such selection shall be submitted for ratification or
rejection at the next succeeding shareholders' meeting. If such meeting shall
reject such selection, the Accountant shall be selected by majority vote, either
at the meeting at which the rejection occurred or at a subsequent meeting of
shareholders called for the purpose.
(d) Any vacancy occurring between regular meetings, due to the death,
resignation or otherwise of the Accountant, may be filled by the Board of
Directors.
Section 7.04. CALENDAR YEAR. The corporation shall operate and its
financial statements shall be prepared on a FISCAL YEAR ENDING MARCH 31.
ARTICLE VIII
INSPECTION OF BOOKS
Section 8.01. Every shareholder of the corporation and every holder of a
voting trust certificate shall have a right to examine, in person or by agent or
attorney, at any reasonable time or times, for any proper purpose, and at the
place or places where usually kept, the share register, books of account and
records of the proceedings of the shareholders and directors and to make
extracts therefrom.
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ARTICLE IX
VOTING OF STOCK HELD
Section 9.01. Unless otherwise provided by resolution of the Board of
Directors, the President, any Vice President, the Secretary or the Treasurer,
may from time to time appoint an attorney or attorneys or agent or agents of the
corporation, in the name and on behalf of the corporation, to cast the votes
which the corporation may be entitled to cast as a stockholder or otherwise in
any other corporation or association, any of whose stock or securities may be
held by the corporation, at meetings of the holders of the stock or other
securities of any such other corporation or association, or to consent in
writing to any action by any such other corporation or association, and may
instruct the person or persons so appointed as to the manner of casting such
votes or giving such consent, and may execute or cause to be executed on behalf
of the corporation and under its corporate seal, or otherwise, such written
proxies, consents, waivers, or other instruments as it may deem necessary or
proper in the circumstances; or any of such officers may themselves attend any
meeting of the holders of stock or other securities of any such corporation or
association and thereat vote or exercise any or all other powers of the
corporation as the holder of such stock or other securities of such other
corporation or association, or consent in writing to any action by any such
other corporation or association.
ARTICLE X
DETERMINATION OF NET ASSET VALUE
Section 10.01. The net asset value per share of each series of stock issued
by the portfolios of the corporation shall be determined in good faith by or
under supervision of the officers of the corporation as authorized by the Board
of Directors as often and on such days and at such time(s) as the Board of
Directors shall determine. Provisions in the currently effective Prospectus of
the corporation regarding determination of net asset value shall be controlling.
Section 10.02. For purposes of the computation of net asset value of the
corporation's shares, the following shall apply:
(a) The Board of Directors, or its authorized officer or other
representative, shall compute the net asset value of shares of common stock at
such times and by such methods as may be required by the Investment Company Act
of 1940 or rules or regulations thereunder. In the absence of any such
requirements, such computation shall be made at least once each day on which the
New York Stock Exchange is open for unrestricted trading. Such computation shall
be as of the close of the New York Stock Exchange.
The Board of Directors may cause the net asset value to be computed at
other times and may vary or terminate the effective periods, to the extent
permitted by applicable law.
(b) The net asset value in effect for the purpose of the issue of common
stock to the public shall be the net asset value next determined after receipt
of a purchase order at the principal office of the corporation or its agent or
in accordance with any provision of the Investment Company Act of 1940 and any
rule or regulation thereunder, or any rule or regulation
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made or adopted by any Securities Association registered under the Securities
Exchange Act of 1934.
(c) The net asset value applicable to each share of common stock of the
corporation surrendered to the corporation for redemption, pursuant to the
provisions of Article VII, Section 7.06 hereof, shall be that value next
determined after the request for redemption is properly received by the
corporation or its agent at either of their principal offices, or in accordance
with such other requirements as may be determined by the directors for
expediting redemptions.
(d) The net asset value of each share of common stock of the corporation
shall be the quotient obtained by dividing the value of the net assets of the
respective series of shares of the corporation (the value of the assets of the
corporation less its liabilities exclusive of common stock and surplus) by the
total number of shares of common stock outstanding at such close, all determined
and computed as follows:
(1) The assets shall be deemed to include:
(i) All cash on hand, on deposit or on call;
(ii) All bills and notes and accounts receivable;
(iii) All shares of stock and subscription rights and other securities
owned or contracted for by the corporation, other than its own
stock;
(iv) All stock and cash dividends and cash distributions to be
received by the corporation and not yet received by it, but
declared to stockholders of record on a date on or before the
date as of which the net asset value is being determined;
(v) All interest accrued on any interest bearing securities owned by
the corporation; and
(vi) All other property of any kind and nature including prepaid
expenses, the value of such assets to be determined as the Board
of Directors according to a method as they shall in good faith
determine to reflect fair market value.
In determining the value of the assets of the corporation for the purpose
of obtaining the net asset value, securities with maturities of sixty days or
less will be valued at cost and interest will be accrued daily. All other assets
of the corporation shall be valued by such method as the Board of Directors in
good faith shall deem to reflect their fair market value.
(2) The liabilities of the corporation shall be deemed to include:
(i) All bills and notes and accounts payable:
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(ii) All administrative expenses payable and/or accrued (including
management fees);
(iii) All contractual obligations for the payment of money or
property, including the amount of any unpaid dividend declared
upon the corporation's stock and payable to stockholders of
record on or before the day as of which the value of the
corporation's stock is being determined;
(iv) All reserves, if any, authorized or approved by the Board of
Directors for taxes; and
(v) All other liabilities of the corporation of whatsoever kind and
nature, except liabilities represented by outstanding common
stock and surplus of the corporation.
(3) For the purpose hereof:
(i) Common stock subscribed for shall be deemed to be outstanding as
of the time of acceptance of any subscription and the entry
thereof on the books of the corporation and the net price
thereof shall be deemed to be an asset of the corporation; and
(ii) Common stock surrendered for redemption to the corporation
pursuant to the provisions of Article VII, Section 7.06 hereof
shall be deemed to be outstanding until the close of business on
the date surrendered and, thereupon, and until paid, the
redemption price thereof shall be deemed to be a liability of
the corporation.
ARTICLE XI
CUSTODY OF ASSETS
Section 11.01. All securities and cash owned by this corporation shall, as
hereinafter provided, be held by or deposited with a bank or trust company
having (according to its last published report) not less than two million
dollars ($2,000,000) aggregate capital, surplus and undivided profits (the
"Custodian").
This corporation shall enter into a written contract with the Custodian
regarding the powers, duties and compensation of the Custodian with respect to
the cash and securities of this corporation held by the Custodian. Said contract
and all amendments thereto shall be approved by the Board of Directors of this
corporation. In the event of the Custodian's resignation or termination, the
corporation shall use its best efforts promptly to obtain a successor Custodian
and shall require that the cash and securities owned by this corporation held by
the Custodian be delivered directly to such successor Custodian.
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ARTICLE XII
AMENDMENTS
Section 12.01. These Bylaws may be amended or altered by a vote of the
majority of the whole Board of Directors at any meeting provided that notice of
such proposed amendment shall have been given in the notice given to the
directors of such meeting. Such authority in the Board of Directors is subject
to the power of the shareholders to change or repeal such Bylaws by a majority
vote of the shareholders present or represented at any meeting of shareholders
called for such purpose. The Board of Directors shall not make or alter any
Bylaws fixing their qualifications, classifications, term of office, or number,
except that the Board of Directors may make or alter any Bylaw to increase their
number.
ARTICLE XIII
INDEMNIFICATION
No indemnification shall be made by this corporation that is inconsistent
with the guidelines set forth in Investment Company Act Releases No. 7221 (June
9, 1972) and No. 11330 (September 2, 1980) or, if such releases are modified,
superseded or rescinded, the guidelines set forth in any successor releases
regarding indemnification under Section 17(h) of the Investment Company Act of
1940.
This copy of the Bylaws is a true and accurate copy of the Bylaws
originally approved and adopted by the Board of Directors on July 8, 1993,
amended and restated as of June 3, 1997 and February 7, 2000.
/s/ Mary K. Beerling
-----------------------------------------
Mary K. Beerling, Secretary
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EXHIBIT 9
Amended and Restated Administration Agreement
<PAGE>
ADMINISTRATION AGREEMENT
This amended and restated Agreement dated March 1, 2000 amends and restates
the Agreement dated May 11, 1999 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 canceling stock
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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;
vii. Compute daily dividend rate for appropriate funds;
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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, 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
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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;
4.03 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;
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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.
(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
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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 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.
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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.
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
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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 The Administrator may, however, without further consent of the Fund,
subcontract for the performance of any of its responsibilities under this
contract with a qualified party acceptable to the Administrator; provided,
however, that any party with whom the Administrator contracts for sub-transfer
agent responsibilities shall be registered as a transfer agent under Section
17A(c)(2) of the Securities Exchange Act of 1934. In the event the Administrator
subcontracts with any party (the "Contracted Party") for any such
responsibilities, the Administrator shall be fully responsible to the Fund for
the acts and omissions of the Contracted Party as it is for its own acts and
omissions.
8.03 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective successors and assigns.
8.04 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.
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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
By /s/ Wallace R. Weitz
-----------------------
ATTEST: President
/s/ Mary K. Beerling
- ------------------------
Asst. Secretary
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WEITZ PARTNERS, INC.
Exhibit A
<TABLE>
<CAPTION>
ASSET BREAK POINTS
- ------------------------------------------
GREATER THAN LESS THAN % OF NAV MINIMUM
<S> <C> <C> <C>
0 25,000,000 0.200% 25,000
25,000,000 100,000,000 0.175%
100,000,000 500,000,000 0.150%
500,000,000 0.050%
</TABLE>
10
<PAGE>
EXHIBIT 11
Consents of PricewaterhouseCoopers, LLP
and
McGladrey and Pullen, LLP
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in this Registration
Statement on Form N-1A of our report dated April 20, 2000, relating to the
financial statements and financial highlights which appears in the March 31,
2000 Annual Report to Shareholders of Partners Value Fund series of Weitz
Partners, Inc., which are also incorporated by reference into the Registration
Statement. We also consent to the references to us under the headings "Financial
Highlights", "Fund Auditor", and "Auditor" in such Registration Statement.
PricewaterhouseCoopers LLP
New York, New York
April 27, 2000
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
-------------------------------
We consent to the use of our report dated January 15, 1999, on the financial
statements of Weitz Partners, Inc. - Partners Value Fund referred to in the
Post-Effective Amendment. No. 7 to the Registration Statement on Form N-1A as
filed with the Securities and Exchange Commission.
McGladrey & Pullen LLP
New York, New York
April 24, 2000
<PAGE>
EXHIBIT 14
Code of Ethics - Weitz Partners, Inc., Weitz Series Fund, Inc., Wallace R.
Weitz & Company and Weitz Securities, Inc.
<PAGE>
CODE OF ETHICS OF
WEITZ SERIES FUND, INC.
WEITZ PARTNERS, INC.
WALLACE R. WEITZ & COMPANY
WEITZ SECURITIES, INC.
Rule 17j-1--Investment Company Act of 1940
WHEREAS, the reputation and integrity of the Weitz Entities (as herein
defined), are dependent upon maintenance of the highest possible standards in
the public and private relationships of the Weitz Entities; and
WHEREAS, it is incumbent upon all Access Persons (as herein defined) to
avoid any activities which might be in conflict with their primary
responsibility toward the Weitz Entities and the shareholders of the Funds or
which would allow such Access Persons to take inappropriate advantage of their
positions; and
WHEREAS, all Access Persons recognize that they act as fiduciaries for
the shareholders of the Funds and that the interests of the shareholders are
primary at all times; and
WHEREAS, in furtherance of such standards and the fiduciary
responsibilities of Access Persons toward shareholders, it is essential that
personal securities transactions of Access Persons be conducted in a manner
consistent with this Code of Ethics and so as to avoid any actual or potential
conflict of interest or abuse of the position of trust and responsibility of
such Access Persons;
NOW, THEREFORE, the Boards of Directors of the Funds, Weitz & Co., and
Weitz Securities hereby each adopt the following Code of Ethics:
Section One - Definitions
(a) "Access Person" means any director, officer, general partner,
or Advisory Person of the Funds, Weitz & Co. or Weitz
Securities.
(b) "Adviser Personnel" means the officers, directors and
employees of Weitz & Co.
(c) "Advisory Person" means (i) any employee of the Weitz Entities
(or of any company in a control relationship to the Weitz
Entities), who, in connection with his or her regular
functions or duties, makes, participates in, or obtains
information regarding the purchase or sale of Covered
Securities by Weitz-Advised Funds, or whose functions relate
to the making of any recommendations with respect to such
purchases or sales and (ii) any natural person in a control
relationship to the Weitz Entities who obtains information
concerning recommendations made to a Weitz-Advised Fund with
regard to the purchase or sale of a Covered Security by a
Weitz-Advised Fund.
1
<PAGE>
(d) "Beneficial Ownership" shall be interpreted in the same manner
as it would be under Regulation 240.16a-1(a)(2) of the
Securities Exchange Act of 1934 (the "Exchange Act") in
determining whether a person is the beneficial owner of a
security for purposes of Section 16 of the Exchange Act.
(e) "Control" has the same meaning as that set forth in Section
2(a)(9) of the Investment Company Act of 1940.
(f) "Covered Security" means a security as defined in Section
2(a)(36) of the Investment Company Act of 1940, except that it
does not include (i) direct obligations of the Government of
the United States, (ii) bankers' acceptances, bank
certificates of deposit, commercial paper and high quality
short-term debt instruments, including repurchase agreements
or (iii) shares of registered open-end investment companies.
(j) "Funds" means Weitz Series Fund, Inc. and Weitz Partners, Inc.
(g) "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of
which, immediately before the registration, was not subject to
the reporting requirements of Sections 13 or 15(d) of the
Exchange Act.
(h) "Investment Personnel" of the Weitz Entities means (i) any
employee of Weitz & Co. who, in connection with his or her
regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities
by a Weitz-Advised Fund; and (ii) any natural person who
controls a Weitz Entity and who obtains information concerning
recommendations made to a Weitz-Advised Fund regarding the
purchase or sale of securities by the Weitz-Advised Fund.
(i) "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to
Section 4(2) or Section 4(6) or pursuant to Rule 504, Rule
505, or Rule 506 under the Securities Act of 1933.
(k) "Portfolio Manager" means an individual who is primarily
responsible for the day-to-day management of one or more of
the Weitz-Advised Funds.
(l) "Purchase or Sale of a Covered Security" includes, among other
things, the writing of an option to purchase or sell a Covered
Security.
(m) "Security Held or to be Acquired" by the Funds means:
(1) Any Covered Security which, within the most recent
15 days:
(i) Is or has been held by one or both of the
Funds; or
(ii) Is being or has been considered by one or
both of the Funds or its investment adviser
for purchase by one or both of the Funds;
and
2
<PAGE>
(2) Any option to purchase or sell, and any security
convertible into or exchangeable for, a Covered
Security described in Paragraph (1) of this
definition.
(n) "Weitz-Advised Funds" includes the Funds, any other registered
open-end investment management company affiliated with or
advised by Weitz & Co., Weitz Income Partners - Limited
Partnership, Weitz Partners III - Limited Partnership,
Heider-Weitz - Limited Partnership and any individual
investment accounts advised by Weitz & Co.
(o) "Weitz & Co." means Wallace R. Weitz & Company, investment
adviser to the Funds.
(p) "Weitz Entities" includes Weitz Series Fund, Inc., Weitz
Partners, Inc., Wallace R. Weitz & Company and Weitz
Securities, Inc.
(q) "Weitz Securities" means Weitz Securities, Inc., distributor
for the Funds.
Section Two - Prohibited Activities
(a) No Access Person shall engage in any activities for material
personal gain or profit which could be detrimental to the
interests of the Funds and their shareholders.
(b) No Access Person, in connection with the purchase or sale,
directly or indirectly, by such person of a Security Held or
to be Acquired by the Funds shall engage in conduct made
unlawful by Rule 17j-1 under the Investment Company Act of
1940. Thus, no Access Person shall:
(1) Employ any device, scheme, or artifice to defraud
the Funds;
(2) Make any untrue statement of a material fact to the
Funds or omit to state a material fact necessary in
order to make the statements made to the Funds, in
light of the circumstances under which they are made,
not misleading;
(3) Engage in any act, practice, or course of business
that operates or would operate as a fraud or deceit
upon the Funds; or
(4) Engage in any manipulative practice with respect to
the Funds.
(c) The following additional restrictions shall apply with respect
to personal transactions of Adviser Personnel in any Covered
Security:
(1) Investment Personnel must acquire prior written
approval of the President of Weitz & Co. or his
designee before directly or indirectly acquiring
beneficial ownership in any securities in an Initial
Public Offering or in a Limited Offering;
3
<PAGE>
(2) All personal transactions in Covered Securities of
Adviser Personnel (except for transactions effected
for any account over which such Adviser Personnel
does not have any direct or indirect influence or
control) shall be precleared by the President of
Weitz & Co. or his designee;
(3) Adviser Personnel are prohibited from executing
personal trades in any Covered Security on any day in
which one or both of the Funds or any other
Weitz-Advised Fund has a pending "buy" or "sell"
order in that same Covered Security until the order
of the respective Fund or other Weitz-Advised Fund is
executed or withdrawn;
(4) Adviser Personnel who are Portfolio Managers are
prohibited from buying or selling any Covered
Security within at least seven calendar days before
and after a trade in that Covered Security by a
portfolio within a Weitz-Advised Fund that he or she
manages. If any such trade shall occur, any profits
realized on such trades shall be disgorged to the
respective Weitz-Advised Fund;
(5) Adviser Personnel are prohibited from profiting as a
result of the purchase and sale (or sale and
purchase) of the same Covered Security (or
equivalent Securities) within a period of 60 days
from the original sale or purchase, as the case may
be, of such Covered Security; provided, however,
that the President or his designee shall have the
right to consent to certain exceptions to this
prohibition. If any such trade shall occur that has
not been consented to by the President, any profits
realized on such trades shall be disgorged to the
respective Weitz-Advised Fund;
(6) Adviser Personnel are prohibited from receiving any
gift or any other thing of more than de minimus value
from any person or entity that does business with or
on behalf of Weitz-Advised Funds; and
(7) Adviser Personnel are prohibited from serving on the
board of directors of publicly traded companies,
except with prior authorization of the President of
Weitz & Co.
Section Three - Reporting and Annual Certification Requirements
(a) In order to implement the restrictions set forth in Section
Two (c) above, Adviser Personnel shall comply with the
following procedures:
(1) All Adviser Personnel shall direct their brokers to
supply to the President of Weitz & Co. or his
designee, on a timely basis, (a) duplicate copies of
confirmations of all personal transactions in Covered
Securities and (b) copies of periodic statements for
all accounts maintained with such broker with respect
to Covered Securities transactions;
4
<PAGE>
(2) Adviser Personnel shall make the following reports of
direct or indirect beneficial ownership of Covered
Securities:
(i) An initial report no later than ten days
after the Adviser Personnel becomes an
employee of Weitz & Co.;
(ii) An annual report which shall report holdings
as of a date no more than thirty days before
the report is submitted.
The initial and annual reports will include the
following information:
(i) The title, number of shares and principal amount
of each Covered Security in which the Adviser
Personnel had any direct or indirect beneficial
ownership;
(ii) The name of any broker, dealer or bank with whom
the Adviser Personnel maintains an account in which
Covered Securities are held for the direct or
indirect benefit of the Adviser Personnel; and
(iii) The date of the report.
(3) All Adviser Personnel shall certify annually:
(i) that they have read and understand this Code
of Ethics and recognize they are subject to
its provisions; and
(ii) that they have complied with the
requirements of the Code of Ethics and have
disclosed or reported all personal
transactions in Covered Securities required
to be reported or disclosed pursuant to the
requirements of the Code of Ethics.
(b) All Access Persons shall report to Weitz & Co. within 10 days
after the end of each calendar quarter the information set
forth below with respect to transactions during such calendar
quarter in any Covered Security in which such Access Person
has, or by reason of such transaction acquires, any direct or
indirect Beneficial Ownership in the Covered Security:
(1) The date of the transaction, the title, the interest
rate and maturity date (if applicable), the number of
shares and the principal amount of each Covered
Security involved;
(2) The nature of the transaction (i.e., purchase, sale,
or any other type of acquisition or disposition);
(3) The price at which the transaction was effected;
(4) The name of the broker, dealer, or bank with or
through whom the transaction was effected;
5
<PAGE>
(5) The date the report is submitted; and
(6) A list of any new brokerage accounts established
during the quarter.
Section Four - Exceptions From Reporting and Preclearance Requirements
No person shall, however, be required to make a report or preclear
personal transactions in Covered Securities pursuant to Section Two (c)(2) other
than the approvals required by Section Two (c)(1):
(a) With respect to transactions effected for, and Covered
Securities held in, any account over which such person does
not have any direct or indirect influence or control;
(b) Where such person is not an interested person of the Funds
within the meaning of Section 2(a)(19) of the Investment
Company Act of 1940 (the "Act"), and would be required to make
such a report solely by reason of being a director of the
Funds unless the director knew or, in the ordinary course of
fulfilling his or her official duties as director of the
Funds, should have known that during the 15-day period
immediately before or after the director's transaction in a
Covered Security, the Funds purchased or sold the Covered
Security, or the Funds or Weitz & Co. considered purchasing or
selling the Covered Security; or
(c) Where a report made to Weitz & Co. would duplicate information
reported pursuant to rules under the Investment Advisers Act
of 1940.
(d) In addition, no Access Person shall be required to preclear
personal transactions in Covered Securities pursuant to
Section Two (c)(2) in the following circumstances:
(1) Reinvestments of dividends pursuant to a plan;
(2) Transactions in: short-term securities issued or
guaranteed by an agency or instrumentality of the
U.S. Government; bankers' acceptances; U.S. bank
certificates of deposit; and commercial paper;
(3) Transactions in which direct or indirect beneficial
ownership is not acquired or disposed of;
(4) Transactions in accounts as to which an Access Person
has no investment control; and
(5) Transactions in securities in connection with an
employer sponsored or other tax qualified plan, such
as a 401(k) plan, an IRA, or ESOP, in an amount not
exceeding $1,000 in any calendar month.
6
<PAGE>
Section Five - Sanctions
The President of Weitz & Co. may impose penalties for violation of this
Code of Ethics commensurate with the gravity of the violation; and such
penalties may range from a written reprimand to fines, denial of salary
increases, job demotions, suspension, or termination.
Section Six - Information and Records
The General Counsel of Weitz & Co. shall be responsible for the
following:
(a) Identifying Access Persons and Adviser Personnel who are under
a duty to provide (i) quarterly transaction reports, and (ii)
initial and annual holding reports;
(b) Informing such Access Persons and Adviser Personnel of such
duties;
(c) Obtaining the annual certification required by Section Three
(a)(3) hereof;
(d) Furnishing a copy of the Code of Ethics to all such persons
prior to its effective date and annually thereafter;
(e) Obtaining the initial and annual reports required by Section
Three (a)(2) hereof and the transaction reports required by
Section Three (b) hereof;
(f) Receiving and reviewing such reports and certifications;
(g) Obtaining the approval by the Boards of Directors of the Code
of Ethics of the Funds, Weitz & Co. and Weitz Securities, Inc.
and any material changes to those Codes;
(h) Providing to the Boards of Director an annual report in
writing setting forth information about material violations of
the Code or the Code procedures, any sanctions imposed in
response to such violations and certifying that the Weitz
Entities have adopted procedures to prevent its Access Persons
from violating the Code; and
(i) Maintaining records in conformance to the requirements set
forth in Rule 17j-1 under the Act.
7
<PAGE>
WEITZ SERIES FUND, INC.
WEITZ PARTNERS, INC.
WALLACE R. WEITZ & COMPANY
WEITZ SECURITIES, INC.
PERSONAL SECURITIES TRANSACTIONS
Rule 204-2(a)(12)IA Act
Rule 17j-1 IC Act
- -------------------------------------------------------------------------------
POLICY: (Terms used herein are used with the definitions assigned in the Code
of Ethics of the Weitz Entities.)
All Access Persons and Adviser Personnel shall, with respect to
personal transactions in any Covered Security, comply fully with the
terms and conditions of the Code of Ethics of the Weitz Entities and
the procedures related to implementing those terms and conditions set
forth below.
- -------------------------------------------------------------------------------
PROCEDURES:
Section One - Procedures Relating to Personal Securities Transactions
A. All Adviser Personnel are required to comply with the following when
effecting personal transactions in Covered Securities in which they,
their families (including the spouse, minor children and adults living
in the same household) and trusts of which they are trustees or in
which they have a beneficial interest, have participated:
(a) to record the transaction in the daily trading log;
(b) to direct their brokers to supply to the President of Weitz &
Co. or his designee, on a timely basis, (i) duplicate copies
of confirmations of all personal transactions in Covered
Securities, and (ii) copies of periodic statements for all
accounts maintained with such broker with respect to
transactions in Covered Securities;
(c) to comply with the restrictions set forth in Section Two of
the Code of Ethics; and
(d) to comply with the Policy Statement on Insider Trading.
B. In addition, all Adviser Personnel shall:
(a) preclear all personal transactions in Covered Securities with
the President of Weitz & Co. or his designee by completing a
preclearance approval in the form attached hereto as Exhibit
A;
8
<PAGE>
(b) make the following reports of direct or indirect beneficial
ownership of Covered Securities in the form attached hereto as
Exhibit B:
(i) no later than ten days after the Adviser Personnel
becomes an employee of Weitz & Co., an initial
report; and
(ii) no later than January 30 of each year an annual
report which reports holdings as of a date no more
than thirty days before the report is submitted.
(c) within 10 days of the end of each calendar quarter, report to
the President of Weitz & Co. the information required by
Section Three (b) of the Code of Ethics with respect to
transactions during such calendar quarter in any Covered
Security in which such Access Person has, or by reason of such
transaction acquires, any direct or indirect Beneficial
Ownership in the Covered Security; provided, however, no such
report shall be required with respect to transactions
described in Section Four of the Code of Ethics;
(d) no later than January 30 of each year, deliver to the
President of Weitz & Co. the certification required by Section
Three (a)(3) of the Code of Ethics in the form attached hereto
as Exhibit C.
C. If the President has, in accordance with Section Two (c)(1) of the Code
of Ethics, given his prior written approval of an investment in an
Initial Public Offering or a Limited Offering by an Investment
Personnel, the President shall make a record of his reasons for such
approval on the relevant preclearance form. Investment Personnel for
whom such investment is approved shall not participate in any
subsequent decisions with respect to an investment in the issuer of
such security by a Weitz-Advised Fund.
D. The President shall consent to exceptions to Section Two (c)(5) of the
Code of Ethics if the President determines that, given the
circumstances of the proposed transaction, a purchase and sale (or sale
and purchase) of the same Covered Security (or equivalent Covered
Securities) within a period of 60 days of the original sale or purchase
of such Covered Security will not cause harm to the Funds or their
shareholders or otherwise be contrary to the purposes of the Code of
Ethics. Relevant factors to such a determination shall be recorded by
the President on the relevant preclearance form.
Section Two - Maintenance of Records
Weitz & Co. shall maintain the following records:
(a) a list of all Access Persons and Adviser Personnel (a copy of
which is attached hereto as Exhibit D);
(b) a chronological listing in the daily trading log of all
securities transactions of the Weitz-Advised Funds;
9
<PAGE>
(c) copies of preclearance forms with respect to personal
transactions in Covered Securities;
(d) a copy of the duplicate copy of the confirmation provided by
the broker and copies of periodic statements for accounts
maintained with such broker with respect to transactions in
Covered Securities;
(e) copies of the initial and annual reports of personal holdings
in Covered Securities delivered pursuant to Section Three
(a)(2) of the Code of Ethics;
(f) copies of the quarterly reports required to be delivered
pursuant to Section Three (b) of the Code of Ethics;
(g) copies of the annual certifications required to be delivered
pursuant to Section Three (a)(3) of the Code of Ethics;
(h) copies of each Code of Ethics for the Weitz Entities that was
in effect during the past five years;
(i) copies of the written approvals of the President pursuant to
Section Two (c)(1) to investments in Initial Public Offerings
or Limited Offerings; and
(j) copies of the reports provided to the Boards of Directors
pursuant to Section Six (h) for the last five years.
Section Three - Annual Report to Boards of Directors
The Vice President/General Counsel of the Adviser shall prepare an
annual report for the Boards of Directors which:
(a) certifies that the Funds each have adopted procedures to
prevent its Access Persons from violating the Code;
(b) identifies any material violations of the Code of Ethics or
these procedures and any sanctions imposed in response to such
violations; and
(c) identifies any recommended changes in existing restrictions or
procedures.
10
<PAGE>
Exhibit A
PRECLEARANCE OF SECURITIES TRANSACTIONS
Name of Adviser Personnel: _________________________________________________
Nature of Transaction: _____________________________________________________
Proposed Date of Transaction: _____________________________________________
Name of Security: __________________________________________________________
Aggregate Dollar Amount of Proposed Transaction: ___________________________
Aggregate Number of Shares To Be Purchased or Sold: ________________________
Transaction Approved by: _____________
Date & Time of Approval: ______________
Record of Reasons for Approval of Short-Term Trades or Investments in Initial
Public Offering or Limited Offering :
11
<PAGE>
Exhibit B
INITIAL/ANNUAL REPORT OF COVERED SECURITIES HOLDINGS*
Employee Name: ______________________________
Date of Report: _____________________________
<TABLE>
<CAPTION>
Number of Broker, Dealer, or Bank with
Name of Security Shares Principal Amount Whom Acct Is Maintained
----------------
<S> <C> <C> <C>
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
- --------------------- ------------------- ---------------- ------------------------------
</TABLE>
* Annual Report should report holdings as of a date no more than thirty days
before the report is submitted.
12
<PAGE>
Exhibit C
CODE OF ETHICS CERTIFICATION
I,________________________________, hereby certify as follows:
(i) I have read the Code of Ethics of Weitz Partners, Inc., Weitz
Series Fund, Inc., Wallace R. Weitz & Co. and Weitz
Securities, Inc. and recognize that I am subject to the
provisions of the Code of Ethics;
(ii) I have complied with the requirements of the Code of Ethics
and have disclosed or reported all personal transactions in
Covered Securities required to be disclosed or reported
pursuant to the requirements of the Code of Ethics.
Dated this____ day of January, ____.
By__________________________
13
<PAGE>
EXHIBIT D
<TABLE>
<CAPTION>
ACCESS PERSONS ADVISER PERSONNEL
-------------- -----------------
<S> <C>
Julie A. Babb Julie A. Babb
Jon A. Baker Jon A. Baker
Mary K. Beerling Mary K. Beerling
Shar M. Bennett Shar M. Bennett
Mary E. Bickels Mary E. Bickels
Thomas D. Carney Thomas D. Carney
Lorraine Chang Kristie L. Dye
Kristie L. Dye Angela D. Fries
Angela D. Fries Carole A. Geist
Carole A. Geist Martha J. Gilchrist
Martha J. Gilchrist Charles F. Heider
John W. Hancock Rachelle R. Hill
Charles F. Heider Kathie A. Joerz
Rachelle R. Hill Nikki J. Johnson
Richard D. Holland Ann K. Krone
Kathie A. Joerz Lori Kuhlmann
Nikki J. Johnson Linda L. Lawson
Ann K. Krone Richard F. Lawson
Lori Kuhlman Steven R. Malousek
Linda L. Lawson Daniel J. McCarthy
Richard F. Lawson Shelly L. Milan
Steven R. Malousek Monica A. Mlynczak
Daniel J. McCarthy Theresa A. O'Connor
Shelly L. Milan Tiffany L. Robbins
Monica A. Mlynczak Daniel A. Sullivan
Theresa A. O'Connor Monica F. Swift
Thomas R. Pansing Patty M. Weist
Tiffany L. Robbins Andrew S. Weitz
Daniel A. Sullivan Wallace R. Weitz
Monica M. Swift Deborah N. Wilson
Delmer L. Toebben
Patty M. Weist
Andrew S. Weitz
Wallace R. Weitz
Deborah N. Wilson
</TABLE>
