<PAGE>
As filed with the Securities and Exchange Commission on July 17, 1998
Securities Act File No. 33-79858
Investment Company Act of 1940 File No. 811-8544
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [_]
POST-EFFECTIVE AMENDMENT NO. 24 [X]
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 [_]
AMENDMENT NO. 25 [X]
UAM FUNDS TRUST
(Exact Name of Registrant as specified in Charter)
c/o United Asset Management Corporation
One International Place
Boston, Massachusetts 02110
(Address of Principal Executive Offices)
Registrant's Telephone Number (617) 330-8900
Michael E. DeFao, Secretary
UAM Fund Services, Inc.
211 Congress Street
Boston, Massachusetts 02110
(Name and Address of Agent for Service)
---------------------------------------
COPY TO:
Audrey C. Talley, Esq.
Drinker Biddle & Reath LLP
Philadelphia National Bank Building
1345 Chestnut Street
Philadelphia, PA 19107-3469
IT IS PROPOSED THAT THIS FILING BECOME EFFECTIVE
(CHECK APPROPRIATE BOX):
[_] Immediately upon filing pursuant to Paragraph (b)
[X] on July 17, 1998, pursuant to Paragraph (b)
[_] 60 days after filing pursuant to paragraph (a) (1)
[_] on (date) pursuant to paragraph (a) (1)
[_] 75 days after filing pursuant to Paragraph (a) (2)
[_] on (date) pursuant to Paragraph (a) (2) of Rule 485.
<PAGE>
PART A
UAM FUNDS TRUST
The following Prospectuses are included in this Post-Effective Amendment No. 24
filed on July 17, 1998:
. BHM&S Total Return Bond Portfolio Institutional Class Shares
. BHM&S Total Return Bond Portfolio Institutional Service Class Shares
. Chicago Asset Management Intermediate Bond Portfolio Institutional Class
Shares
. Chicago Asset Management Value/Contrarian Portfolio Institutional Class
Shares
. FPA Crescent Portfolio Institutional Class Share
. FPA Crescent Portfolio Institutional Service Class Shares
. Hanson Equity Portfolio Institutional Class Shares
. Jacobs International Octagon Portfolio Institutional Class Shares
. MJI International Equity Portfolio Institutional Class Shares
. MJI International Equity Portfolio Institutional Service Class Shares
. TJ Core Equity Portfolio Institutional Service Class Shares
The following Prospectuses are contained in Post-Effective Amendment No.23
filed July 2, 1998:
. Clipper Focus Portfolio Institutional Class Shares
. Clipper Focus Portfolio Institutional Service Class Shares
The following Prospectus is contained in Post-Effective Amendment No.22 filed
June 24, 1998:
. PR Mid Cap Growth Portfolio Institutional Class Shares
The following Prospectuses are contained in Post-Effective Amendment No.21
filed June 19, 1998:
. Heitman Real Estate Portfolio Institutional Class Shares
. Heitman Real Estate Portfolio Advisor Class Shares
The following Prospectus is contained in Post-Effective Amendment No.18 filed
January 23, 1998:
. Cambiar Opportunity Portfolio Institutional Class Shares
The following Prospectus is contained in Post-Effective Amendment No. 2 filed on
November 25, 1994:
. Dwight Principal Preservation Portfolio Institutional Class Shares
<PAGE>
PART B
UAM FUNDS TRUST
The following Statements of Additional Information are included in this Post-
Effective Amendment No.24 filed on July 17, 1998:
. BHM&S Total Return Bond Portfolio Institutional Class Shares and
Institutional Service Class Shares
. Chicago Asset Management Intermediate Bond Portfolio Institutional Class
Shares and Chicago Asset Management Value/Contrarian Portfolio Institutional
Class Shares
. FPA Crescent Portfolio Institutional Class Share and Institutional Service
Class Shares
. Hanson Equity Portfolio Institutional Class Shares
. Jacobs International Octagon Portfolio Institutional Class Shares
. MJI International Equity Portfolio Institutional Class Shares and
Institutional Service Class Shares
. TJ Core Equity Portfolio Institutional Service Class Shares
The following Statement of Additional Information is contained in Post-Effective
Amendment No. 23 filed July 2, 1998:
. Clipper Focus Portfolio Institutional Class Shares and Institutional Service
Class Shares
The following Statement of Additional Information is contained in Post-Effective
Amendment No. 22 filed June 24, 1998:
. PR Mid Cap Growth Portfolio Institutional Class Shares
The following Statement of Additional Information is contained in Post-Effective
Amendment No. 21 filed June 19, 1998:
. Heitman Real Estate Portfolio Institutional Class Shares and Advisor Class
Shares
The following Statement of Additional Information is contained in Post-Effective
Amendment No. 18 filed January 23, 1998:
. Cambiar Opportunity Portfolio Institutional Class Shares
The following Statement of Additional Information is contained in Post-Effective
Amendment No. 2 filed on November 25, 1994:
. Dwight Principal Preservation Portfolio Institutional Class Shares
<PAGE>
UAM Funds
Prospectus
July 17, 1998
BHM&S Total Return Bond Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Fund Expenses............................................................... 1
Prospectus Summary.......................................................... 3
Risk Factors................................................................ 4
Financial Highlights........................................................ 5
Investment Objective........................................................ 6
Investment Policies......................................................... 6
Other Investment Policies................................................... 7
Investment Limitations...................................................... 13
Purchase of Shares.......................................................... 14
Redemption of Shares........................................................ 18
Shareholder Services........................................................ 20
Valuation of Shares......................................................... 22
Performance Calculations.................................................... 22
Dividends, Capital Gains Distributions and Taxes............................ 23
Investment Adviser.......................................................... 24
Adviser's Historical Performance............................................ 26
Administrative Services..................................................... 28
Distributor................................................................. 28
Portfolio Transactions...................................................... 29
General Information......................................................... 29
UAM Funds -- Institutional Class Shares..................................... 32
</TABLE>
<PAGE>
UAM FUNDS
BHM&S TOTAL RETURN
BOND PORTFOLIO
INSTITUTIONAL CLASS SHARES
- -------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. The BHM&S To-
tal Return Bond Portfolio currently offers two separate classes of shares: In-
stitutional Class Shares and Institutional Service Class Shares ("Service
Class Shares"). Shares of each class represent equal, pro-rata interests in a
Portfolio and accrue dividends in the same manner except that Service Class
Shares bear fees payable by the class to financial institutions for services
they provide to the owners of such shares. The securities offered in this Pro-
spectus are Institutional Class Shares of one diversified, no-load Portfolio
of the Fund managed by Barrow, Hanley, Mewhinney & Strauss, Inc.
BHM&S TOTAL RETURN BOND PORTFOLIO. BHM&S Total Return Bond Portfolio (the
"Portfolio") seeks to provide maximum long-term total return consistent with
reasonable risk to principal by investing in investment grade fixed income se-
curities of varying maturities. Income return is expected to be a predominant
portion of the Portfolio's total return. Any capital return on the Portfolio
is dependent upon, among other factors, interest rate changes as well as the
average maturity and duration of the Portfolio. The Adviser believes that by
investing in undervalued securities with above average effective yields and
capital appreciation potential, the Portfolio will generate superior returns
over the long term while minimizing volatility and, therefore, downside risk.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the
SAI contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction fees. However, transaction fees may be charged if a broker-dealer
or other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<CAPTION>
INSTITUTIONAL
CLASS SHARES
-------------
<S> <C>
Sales Load Imposed on Purchases................................ NONE
Sales Load Imposed on Reinvested Dividends..................... NONE
Deferred Sales Load............................................ NONE
Redemption Fees................................................ NONE
Exchange Fee................................................... NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees (After Fee Waiver)........................... 0.18%
12b-1 Fees............................................................ NONE
Other Expenses (After Fee Waiver)..................................... 0.72%
----
Total Operating Expenses (After Fee Waiver)........................... 0.90%*
====
</TABLE>
- -----------
* The Adviser intends to cap, to the extent of the current advisory fees, the
Portfolio's Institutional Class Shares' Total Operating Expenses (excluding
interest, taxes and extraordinary expenses), after the effect of expense
offsets, at 0.90% of the average daily net assets through December 31, 1998.
The figures above include the effect of expense offsets. If expense offsets
were excluded, Total Operating Expenses of the Portfolio would not be af-
fected. (See "FINANCIAL HIGHLIGHTS.") Absent the Adviser's and/or other
service providers' waiver of fees, the Investment Advisory Fees, Other Ex-
penses and Total Operating Expenses of the Portfolio's Institutional Class
Shares would have been 0.35%, 0.85% and 1.20%, respectively, of average
daily net assets. The Adviser and other service providers may change or dis-
continue their fee waivers at any time.
The table above shows various fees and expenses an investor may bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's Institutional Class Shares' operations during the fiscal year
ended April 30, 1998, as restated to reflect the current Investment Advisory
Fees and Other Expenses.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
BHM&S Total Return Bond Portfolio
Institutional Class Shares................... $ 9 $29 $50 $111
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Barrow, Hanley, Mewhinney & Strauss, Inc. (the "Adviser") is a registered
investment adviser specializing in the active management of stock, bond and
balanced portfolios for institutional, tax-exempt clients. Founded in 1979,
the firm is a wholly-owned subsidiary of United Asset Management Corporation.
The Adviser currently has $33 billion in assets under management. (See "IN-
VESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in the Portfo-
lio's shares automatically unless an investor elects to receive cash distribu-
tions. (See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTION AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
Prospective investors should consider the following: (1) The fixed income
securities held by the Portfolio will be affected by general changes in inter-
est rates resulting in increases or decreases in the value of the securities.
The value of fixed income securities can be expected to vary inversely to the
changes in prevailing interest rates, i.e., as interest rates decline, the
market value of fixed income securities tends to increase and vice versa; (2)
The Portfolio may purchase securities on a when-issued basis which do not earn
interest until issued and may decline or appreciate in market value prior to
their delivery to the Portfolio; (3) The Portfolio will invest in investment
grade debt securities, but reserves the right to hold securities that have
been downgraded. Adverse economic and corporate changes and changes in inter-
est rates may have a greater impact on issuers of lower rated debt securities
which the Portfolio may hold, which may lead to greater price volatility. Al-
so, lower rated securities may be more difficult to value accurately or sell
in the secondary market; (4) The Portfolio may invest in repurchase agreements
which entail a risk of loss should the seller default on its transaction; (5)
The Portfolio may lend its investment securities, which entails a risk of loss
should a borrower fail financially. (See "OTHER INVESTMENT POLICIES.")
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented for the Portfolio's Institutional
Class Shares. This table is part of the Portfolio's Annual Financial State-
ments, which are included in the Portfolio's 1998 Annual Report to Sharehold-
ers. The Report is incorporated by reference into the Portfolio's SAI. The
Portfolio's Annual Financial Statements have been audited by
PricewaterhouseCoopers LLP whose unqualified opinion thereon is also incorpo-
rated into the SAI. The following information should be read in conjunction
with the Portfolio's 1998 Annual Report to Shareholders. Further information
about the Portfolio's performance is contained in its Annual Report, which may
be obtained without charge by calling the telephone number on the Prospectus
cover page.
<TABLE>
<CAPTION>
NOVEMBER 1,
YEAR ENDED YEAR ENDED 1995*** TO
APRIL 30, 1998++ APRIL 30, 1997++ APRIL 30, 1996^^^++
---------------- ---------------- -------------------
<S> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 9.96 $ 9.85 $10.00
------- ------- ------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income.. 0.58 0.60 0.28
Net Realized and
Unrealized Gain
(Loss) on
Investments.......... 0.41 0.05 (0.27)
------- ------- ------
Total from Investment
Operations......... 0.99 0.65 0.01
------- ------- ------
DISTRIBUTIONS
Net Investment Income.. (0.55) (0.54) (0.16)
Net Realized Gain...... (0.04) -- --
------- ------- ------
Total Distributions.. (0.59) (0.54) (0.16)
------- ------- ------
NET ASSET VALUE, END OF
PERIOD................. $ 10.36 $ 9.96 $ 9.85
======= ======= ======
TOTAL RETURN+............ 10.16% 6.75% 0.08%**
======= ======= ======
RATIOS AND SUPPLEMENTAL
DATA
Net Assets, End of
Period (Thousands)... $19,927 $13,062 $2,445
Ratio of Expenses to
Average Net Assets... 0.68% 0.57% 0.61%*
Ratio of Net Investment
Income to Average Net
Assets............... 5.69% 6.01% 5.53%*
Portfolio Turnover
Rate................. 210% 151% 55%
Ratio of Voluntary
Waived Fees and
Expenses Assumed by
the Adviser to
Average Net Assets... 0.52% 1.16% 4.63%*
Ratio of Expenses to
Average Net Assets
Including Expense
Offsets.............. 0.68% 0.55% 0.55%*
</TABLE>
- -----------
* Annualized.
** Not Annualized.
*** Commencement of Operations.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the period.
++ Per share amounts are based on average outstanding shares.
5
<PAGE>
INVESTMENT OBJECTIVE
The objective of the Portfolio is to provide maximum long-term total return
consistent with reasonable risk to principal by investing in investment grade
fixed income securities of varying maturities. Income return is expected to be
a predominant portion of the Portfolio's total return. Any capital return on
the Portfolio is dependent upon, among other factors, interest rate changes as
well as the average maturity and duration of the Portfolio. The Adviser be-
lieves that by investing in undervalued securities with above average effec-
tive yields and capital appreciation potential, the Portfolio will generate
superior returns over the long term while minimizing volatility and, there-
fore, downside risk.
INVESTMENT POLICIES
The Portfolio seeks to achieve its objective by investing at least 90% of
its total assets in a diversified portfolio of the following dollar-denomi-
nated investment grade issues of varying maturities, with an intermediate av-
erage maturity: U.S. Treasuries and Agencies; zero coupon obligations; mort-
gage-backed securities; asset-backed securities; corporate bonds; municipal
bonds; and domestic, Yankee dollar and Eurodollar bonds (See "OTHER INVESTMENT
POLICIES"). These issues may have fixed, variable or floating rates of inter-
est. Bond and note futures may be used for hedging interest rate risk for the
Portfolio to an average weighted duration comparable to the Salomon Brothers'
Broad or Lehman Brothers Aggregate Indices.
The Adviser expects to actively manage the Portfolio in order to meet the
investment objective. To produce favorable returns, the Adviser will invest in
securities that it believes to be undervalued, generating an effective yield
advantage versus the market. To control the volatility of returns, the Portfo-
lio will exhibit a high current yield, a high quality and a conservative matu-
rity structure.
The Adviser's decision process will focus on security selection, sector con-
centration and yield curve positioning. The Adviser will not engage in eco-
nomic forecasts in an attempt to "time the market" since it believes that
there are too many economic and political variables on a domestic and interna-
tional basis to do so successfully on a consistent basis. Therefore, the Port-
folio will maintain a conservative intermediate maturity structure, with secu-
rities being diversified along the yield curve. The Portfolio's average
weighted maturity will generally be ten years or less, with the average
weighted duration comparable to that of the Salomon Brothers' Broad Investment
Grade Index which is approximately five years. Duration compares interest rate
risk between securities with different coupons and different maturities, sum-
marizing in a single number the price sensitivity of a bond--how a bond's ma-
turity and coupon rate affect its exposure to interest rate risk. Duration in-
volves the application of several principles: as the maturity of a bond in-
creases, duration increases; as the coupon of a bond increases, duration de-
creases; generally, the lower the coupon payment, the higher the duration; and
duration decreases as the frequency of the coupon payment increases. General-
ly, 10% or
6
<PAGE>
less of the Portfolio's assets will be invested in various short-term invest-
ments. Please see "SHORT-TERM INVESTMENTS" for a list of the short-term in-
struments in which the Portfolio may invest.
The Adviser's security selection process begins by analyzing a bond's yield
to maturity premium (or spread) versus the most recently issued U.S. Treasury
of similar maturity. Having identified bonds with an above-average premium,
the Adviser will then evaluate factors that could influence the bond's future
premium (i.e., credit quality, security structure, supply/demand relation-
ships, etc.). The objective of this process is to identify those issues whose
yield premium will compress or narrow over a wide range of potential interest
rate change, supporting superior long term performance. Furthermore, the Ad-
viser will concentrate the Portfolio's holdings in industry sectors and matu-
rity ranges that it believes are undervalued while seeking a prudent level of
diversification.
The Portfolio will invest in investment grade bonds which have one of the
four highest rating categories (i.e. Aaa, Aa, A or Baa by Moody's Investors
Service ("Moody's") or AAA, AA, A or BBB by Standard & Poor's Ratings Services
("S&P"), Fitch IBCA, or Duff and Phelps Credit Rating Service) at the time of
purchase. Bonds rated Baa or BBB have speculative characteristics and may be
more sensitive to changes in the economy and the financial condition of is-
suers than higher rated bonds. The Adviser also reserves the right to retain
securities which are downgraded by one or both of the rating agencies if, in
the Adviser's judgment, retention of the securities is warranted. The Portfo-
lio's SAI contains a more detailed description of bond ratings.
OTHER INVESTMENT POLICIES
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's or if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
7
<PAGE>
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money market instruments including variable rate demand notes
and tax-exempt money instruments. By entering into these investments on a
joint basis, the Portfolio may earn a higher rate of return on investments
relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities
8
<PAGE>
loaned. Lending of securities is subject to review by the Fund's Board of
Trustees. All relevant facts and circumstances, including the creditworthiness
of the broker, dealer or institution, will be considered by the Adviser in
making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets
9
<PAGE>
may be invested in the securities of any one investment company, nor may it
acquire more than 3% of the voting securities of any investment company. The
Portfolio will indirectly bear its proportionate share of any management fees
paid by an investment company in which it invests in addition to the advisory
fee paid by the Portfolio.
The Fund has received permission from the SEC, to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may invest up to 15% of its
net assets in illiquid securities. Prices realized from the sales of these se-
curities could be more or less than those originally paid by the Portfolio or
less than what may be considered the fair value of such securities.
MORTGAGE-BACKED SECURITIES
The Portfolio may invest in mortgage-backed securities. Mortgage-backed se-
curities are collateralized by pools of mortgages assembled for subsequent
sale to investors by various governmental agencies and sponsored organizations
as well as by private issuers. The underlying assets collateralizing the mort-
gage-backed securities may include single-family, multifamily and commercial
properties. The two fundamental forms of mortgage-backed securities are pass-
throughs and collateralized mortgage obligations ("CMOs"). Pass-throughs pro-
duce monthly payments of principal and interest from the underlying mortgages.
CMOs divide the cash flows generated from the underlying mortgages or mortgage
pass-through securities into different segments known as "tranches" which are
then retired sequentially over time in order of priority. The market value and
yield of mortgage-backed securities will fluctuate due to market interest rate
change and early prepayments of the underlying mortgages. As prepayment rates
on mortgages vary widely, it is difficult to accurately predict the average
maturity of a particular pool of mortgages
10
<PAGE>
or tranches of CMOs. Although mortgage-backed securities may offer higher
yields than those available from other types of securities, they may be less
effective than other types of securities as a means of "locking in" an attrac-
tive rate for an extended period because of the prepayment feature. Prepayment
risk has two important effects. First, like bonds in general, mortgage-backed
securities will generally decline when interest rates rise. Second, when in-
terest rates fall and additional mortgage prepayments must be reinvested at
lower interest rates, a Portfolio's rate of dividend income may be reduced.
Mortgage-backed securities in which the Portfolio may invest will either carry
a guarantee from an agency of the U.S. Government or a private issuer of the
timely payment of principal and interest or will be suitably structured to be
considered by the Adviser to be of investment grade quality.
ASSET-BACKED SECURITIES
The Portfolio may invest in asset-backed securities. Asset-backed securities
are collateralized by short maturity loans such as automobile receivables,
credit card receivables, or other types of receivables or assets, the payments
from which are passed through to the security holder. Credit support for as-
set-backed securities may be based on the underlying assets and/or provided
through credit enhancements by a third party. Credit enhancement techniques
include letters of credit, insurance bonds, limited guarantees (which are gen-
erally provided by the issuer), senior-subordinated structures and over-
collateralization. The value of these securities may be significantly affected
by changes in interest rates, the market's perceptions of the issuers and the
creditworthiness of the parties involved.
MUNICIPAL OBLIGATIONS
Municipal obligations include notes, bonds and other securities issued by or
on behalf of states, territories and possessions of the U.S. and the District
of Columbia and their political subdivisions, agencies and instrumentalities.
The interest on such municipal obligations will normally be exempt from fed-
eral income tax. These bonds may be general obligation bonds secured by the
issuer's pledge of its full faith, credit and taxing power for the payment of
principal and interest, or they may be revenue bonds payable from specific
revenue sources, but are not generally backed by the issuers' taxing power.
These obligations may include private activity bonds where payment is the re-
sponsibility of the private industrial user of the facility financed by the
bonds. Municipal notes are issued to meet short-term funding requirements of
the issuer and include construction loan notes, short-term discount notes,
tax-exempt commercial paper, demand notes and similar instruments. Municipal
bonds will be rated investment grade by Moody's and S&P, as described above.
Investment grade municipal notes will be rated MIG1, MIG2 or MIG3 by Moody's,
or SP-1 or SP-2 by S&P or, if unrated, determined by the Adviser to be of com-
parable quality. Please refer to the Portfolio's SAI for a detailed descrip-
tion of municipal note ratings.
11
<PAGE>
YANKEE DOLLAR AND EURODOLLAR SECURITIES
Yankee dollar securities are U.S. dollar-based obligations issued inside the
United States by foreign entities. Eurodollar securities are U.S. dollar-based
obligations issued outside the United States by domestic or foreign entities.
Investment in these securities involves certain risks which are not typically
associated with investing in domestic securities. For example, non U.S.-based
issuers are not subject to the same accounting, auditing and financial report-
ing standards as are domestic issuers. There may be less publicly-available
information about non-U.S.-based issuers which may make it difficult to make
investment decisions. Political factors may have an impact in the form of con-
fiscatory taxation, expropriation or political instability in international
markets. Some foreign governments also levy withholding taxes against dividend
and interest income. Although in some countries a portion of the taxes is re-
coverable, the non-recovered portion of foreign withholding taxes will reduce
the income the Portfolio receives from the companies comprising its invest-
ments.
ZERO COUPON SECURITIES
A portion of the Portfolio may be invested in zero coupon securities which
are fixed income securities that do not make regular interest payments. Zero
coupon securities are sold at substantial discounts from their face value. The
difference between a zero coupon security's issue or purchase price and its
face value represents the imputed interest an investor will earn if the obli-
gation is held until maturity. Zero coupon securities may offer the Portfolio
the opportunity to earn higher yields than those available on ordinary inter-
est paying obligations of similar credit quality and maturity. However, the
prices of zero coupon securities may also exhibit greater price volatility
than ordinary fixed income securities because of the manner in which their
principal and interest are returned to the investor. The Portfolio will accrue
income on such investments for tax and accounting purposes which is distribut-
able to shareholders. Since no cash is received at the time of accrual, the
Portfolio may be required to liquidate portfolio securities to satisfy its
distribution obligations.
FUTURES CONTRACTS AND OPTIONS
In order to remain fully invested and to reduce transaction costs, the Port-
folio may invest in bond futures, interest rate futures contracts and options.
Because transaction costs associated with futures and options may be lower
than costs of investing in bonds directly, the use of index futures and op-
tions to facilitate cash flows may reduce a Portfolio's overall transaction
costs. The Portfolio may enter into futures contracts provided that not more
than 5% of the Portfolio's assets are required as a margin deposit to secure
obligations under such contracts. The Portfolio will engage in futures and op-
tions transactions for hedging purposes only and not for speculative purposes.
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<PAGE>
Futures and options can be volatile and involve various degrees and types of
risk. If the Portfolio judges market conditions incorrectly or employs a
strategy that does not correlate well with its investments, use of futures and
options contracts could result in a loss. The Portfolio could also suffer
losses if it is unable to liquidate its position due to an illiquid secondary
market. In the opinion of the Trustees of the Fund, the risk that the Portfo-
lio will be unable to close out a futures position or options contract will be
minimized by only entering into futures contracts or options transactions
traded on national exchanges and for which there appears to be a liquid sec-
ondary market.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies;
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The investment objectives of the Portfolio are fundamental and may be
changed only with the approval of the holders of a majority of the outstanding
shares of such Portfolio. Except for limitations (a), (b), (d), (e) and
(f)(i), the Portfolio's investment limitations and policies described in this
Prospectus and in
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<PAGE>
the SAI are not fundamental and may be changed by the Fund's Board of Trustees
upon reasonable notice to investors. All other investment limitations de-
scribed here and in the SAI are fundamental policies and may be changed only
with the approval of the holders of a majority of the outstanding shares of
the Portfolio. If a percentage limitation on investment or utilization of as-
sets as set forth above is adhered to at the time an investment is made, a
later change in percentage resulting from changes in the value or total cost
of the Portfolio's assets will not be considered a violation of the restric-
tion.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value next deter-
mined after an order is received by the Fund and payment is received by the
Fund or its designated Service Agent. (See "VALUATION OF SHARES.") The minimum
initial investment required is $2,500. The minimum initial investment for IRA
accounts is $500. The minimum initial investment for spousal IRA accounts is
$250. Certain exceptions may be permitted by the officers of the Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemptions of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding additional or different
purchase or redemption conditions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. Amounts paid to Service Agents may include transaction fees
and/or service fees paid by the Fund from the Fund assets attributable to the
Service Agent, which would not be imposed if shares of the Portfolio were pur-
chased directly from the Fund or the Distributor. Service Agents may provide
shareholder services to their customers that are not available to a share-
holder dealing directly with the Fund. A salesperson and any other person en-
titled to receive compensation for selling or servicing Portfolio shares may
receive different compensation with respect to one particular class of shares
over another in the Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase or redemp-
tion orders on behalf of clients and customers, with payment to follow no
later than a Portfolio's pricing on the following business day. If payment is
not received by the Fund's Sub-Transfer Agent, Chase Global Funds Services
Company ("CGFSC") by such time, the Service Agent could be held liable for re-
sulting fees or losses. A Portfolio may be deemed to have received a purchase
or redemption order when a Service Agent, or, if applicable, its authorized
designee, accepts the order. Orders
14
<PAGE>
received by the Fund in proper form will be priced at the Portfolio's net as-
set value next computed after they are accepted by a Service Agent or its au-
thorized designee. Service Agents are responsible to their customers and the
Fund for timely transmission of all subscription and redemption requests, in-
vestment information, documentation and money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application, and mail it together with a check pay-
able to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds".
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired, and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that day's price. An account number and a wire control number will be
provided to you in addition to wiring instructions. Next,
. instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name ____________
Your Account Number __________
Your Account Name _____________
Wire Control Number __________
(assigned by UAM Funds Service Center)
15
<PAGE>
. Forward a completed Application to the UAM Funds Service Center at the
address shown on the Form. Federal Funds purchases will be accepted only
on days when the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed by this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased is identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action. (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN.")
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or reject purchase orders when, in the judgment of
management, such suspension or rejection is in the best interests of the Fund.
The Portfolio is intended to be a long-term investment vehicle and is not de-
signed to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases can be disruptive to efficient
portfolio management and,
16
<PAGE>
consequently, can be detrimental to a Portfolio's performance and its share-
holders. Accordingly, if the Fund's management determines that an investor is
engaged in excessive trading, the Fund, with or without prior notice, may re-
ject in whole or part any purchase request with respect to such investor's ac-
count. Such investor also may be barred from purchasing other portfolios of
the UAM Funds.
Purchases of shares will be made in full and fractional shares calculated to
three decimal places. Certificates for whole shares will be issued upon writ-
ten request by the shareholder. Certificates for fractional shares will not be
issued.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
17
<PAGE>
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone, at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of your shares depending
on the market value of the investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed);
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or
18
<PAGE>
Sub-Transfer Agent may be liable for any losses due to unauthorized or fraudu-
lent telephone instructions if the Fund or the Sub-Transfer Agent does not em-
ploy the procedures described above. Neither the Fund nor the Sub-Transfer
Agent will be responsible for any loss, liability, cost or expense for follow-
ing instructions received by telephone that it reasonably believes to be genu-
ine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address, or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center or a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Board of Trustees determines that it would be detrimental to the best
interests of remaining shareholders of the Fund to make payment wholly or
partly in cash, the Fund may pay redemption proceeds in whole or in part by a
distribution in-kind of liquid securities held by the Portfolio in lieu of
cash in conformity with applicable rules of the SEC. Investors may incur bro-
kerage charges on the sale of portfolio securities received in payment of re-
demptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or
19
<PAGE>
exchange out of the account. If at any time your total investment does not
have a value of at least fifty percent of the required minimum initial invest-
ment amount, you may be notified that the value of your account is below the
Portfolio's minimum account balance requirement. You would then be allowed 60
days to make an additional investment before the account is liquidated. Re-
tirement accounts and certain other accounts will not be subject to automatic
liquidation. Reductions in value that result solely from market activity will
not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility for the authentic-
ity of telephoned instructions, see "REDEMPTION OF SHARES BY TELEPHONE". An
exchange into another UAM Funds Portfolio is a sale of shares and may result
in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of
20
<PAGE>
$100 per transaction) at regular intervals selected by the shareholder. Pro-
vided the shareholder's bank or other financial institution allows automatic
withdrawals, shares are purchased by transferring funds via the Automated
Clearing House ("ACH"). Investment made through ACH will be automatically
transferred from a shareholder's checking, bank money market or NOW account
designated by the shareholder. Such withdrawals are made electronically, if
the shareholder's bank or financial institution so permits, or by pre-autho-
rized checks or drafts drawn on the shareholder's bank or other account. The
bank or financial institution must be a member of ACH. At the shareholder's
option, the account designated will be debited in the specified amount, and
shares will be purchased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Services Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O.
Box 2798, Boston, MA 02208-2798. Notification generally will be effective
three business days following receipt. The Fund may modify or terminate this
privilege at any time, or may charge a service fee, although no such fee cur-
rently is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any time by the Fund. A share-
holder may elect at any time, in writing, to terminate participation in the
Systematic Withdrawal Plan. Such written election must be sent to and received
by the Fund before a termination becomes effective. There is currently no
charge to the shareholder for a Systematic Withdrawal Plan.
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<PAGE>
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the NYSE on each day that the NYSE is open for
business.
Bonds and other fixed income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities. Securities purchased with remaining
maturities of 60 days or less are valued at amortized cost when the Board of
Trustees determines that amortized cost reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount, except that service fees, distribution charges and
any additional transfer agency costs relating to Service Class Shares will be
borne exclusively by that class.
22
<PAGE>
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the telephone number on the cover of this
Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, the Portfolio will normally distribute them
annually. All dividends and capital gains distributions will be automatically
reinvested in additional shares of the Portfolio unless the Fund is notified
in writing that the shareholder elects to receive distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number provided is correct and that either you are
not currently subject to backup withholding or you are exempt from backup
withholding. This certification must be made on the Application or on a sepa-
rate form supplied by the Fund.
23
<PAGE>
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
The Adviser is a registered investment adviser formed in 1979. Its business
offices are located at One McKinney Plaza, 3232 McKinney Avenue, 15th Floor,
Dallas, Texas 75204. The Adviser is a wholly-owned subsidiary of United Asset
Management Corporation ("UAM"), a holding company, and provides and offers in-
vestment management services to corporate, public and Taft-Hartley employee
benefit plans, foundations, endowments, health care and other institutions and
investors. The Adviser currently has $33 billion in assets under management.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 0.35%. The Adviser intends to waive a por-
tion of its advisory fees, if necessary, to keep the Portfolio's Institutional
Class Shares total operating expenses from exceeding 0.90% of average daily
net assets through December 31, 1998. The Adviser will not be reimbursed by
the Fund for any advisory fees which are waived for a given year.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at its own expense, compensate a Service Agent or other person for
marketing, shareholder servicing, recordkeeping and/or other services per-
formed with respect to the Fund, the Portfolio or any Class of Shares of the
Portfolio. Payments made for any of these purposes may be made from the paying
entity's revenues, its profits or any other source available to it. When such
service arrangements are, in effect, they are made generally available to all
qualified service providers.
The Distributor, the Adviser and certain of their affiliates also partici-
pate, at the date of this Prospectus, in an arrangement with Smith Barney Inc.
("Smith Barney") under which Smith Barney provides certain defined contribu-
tion plan marketing and other shareholder services and receives from such en-
tities 0.15 of 1% of the daily net asset value of Institutional Class Shares
held by Smith Barney's eligible customer accounts in addition to amounts pay-
able to all selling dealers. The Fund also compensates Smith Barney for serv-
ices it provides to certain defined contribution plan shareholders that are
not otherwise provided by UAMFSI.
The investment professionals at the Adviser responsible for the day-to-day
management of the Portfolio and their qualifications are as follows:
24
<PAGE>
JOHN S. WILLIAMS -- Fixed Income Principal and the first fixed income port-
folio manager at the Adviser in 1983. Mr. Williams has also managed balanced
and municipal portfolios during his 21 year investment career. Prior to join-
ing the Adviser, he was responsible for the management of all fixed income as-
sets at Southland Trust, Dallas, Texas, and prior to that was a portfolio man-
ager and securities analyst at InterFirst Bank Dallas Trust Department. Mr.
Williams has served on the Advisory Committee for the Texas Teachers Retire-
ment System and is an active member in the Dallas Investment Analysts Society.
He currently is a Director of United Asset Management Corporation. Mr. Wil-
liams is a Chartered Financial Analyst, earning his MBA in 1976 and BBA in
1975 from Texas Christian University.
DAVID R. HARDIN -- Fixed Income Principal and portfolio manager. Prior to
joining the Adviser in 1987, Mr. Hardin was the Vice President and Director of
the Fixed Income Group of RepublicBank Dallas Trust Department. In that posi-
tion, he was responsible for the management of all taxable and tax-exempt
fixed income assets of the Trust Division, including all separately managed
accounts, collective investment fund products, and the creation of and manage-
ment of an SEC-registered mutual fund. Prior to attaining the Director's posi-
tion, Mr. Hardin was a taxable portfolio manager and also served as the credit
analyst for the Trust Division. He started his investment career as a private
placement credit analyst while employed by American General Insurance Co. in
Houston in 1976. Mr. Hardin received an M.Sc. from The London School of Eco-
nomics in 1975 and a BBA from Texas Christian University in 1973.
STEPHEN M. MILANO -- Fixed Income Principal and portfolio manager. Prior to
joining the Adviser in 1990, Mr. Milano was employed at Salomon Brothers, Inc.
in New York as a Vice President of the Fixed Income Strategy Group. In that
role he was a specialist in developing portfolio structure and strategies for
active management of taxable assets. While at Salomon he also served as Prod-
uct Sales Manager for International Fixed Income Securities and as a Mortgage
and Government Specialist. Prior to joining Salomon, Mr. Milano was employed
as a portfolio manager and trader at Equitable Life Assurance Society. He re-
ceived his BS in Economics with a concentration in Finance from the Wharton
School of the University of Pennsylvania in 1980.
J. SCOTT MCDONALD -- Fixed Income Principal and Portfolio Analyst/Trader.
Mr. McDonald joined the Adviser in 1995 to serve as a security and portfolio
specialist for the Fixed Income Group. In addition to security and portfolio
analyst, he is responsible for systems analytics used in the evaluation of
effective/option adjusted yield measurements for all securities and portfo-
lios. He also serves as compliance monitor of all fixed income portfolios to
ensure commonality of structure and diversification. Mr. McDonald previously
served as the Senior Vice President and Portfolio Manager at Life Partners
Group, Inc. in Dallas. While with Life Partners, he was responsible for imple-
menting investment strategy
25
<PAGE>
for $3 billion in assets. Additionally, he has been employed by Texas Commerce
Bank Houston as a Credit Supervisor and Lending Officer. He received his MBA
in 1991 from the University of Texas at Austin and his BBA from Southern Meth-
odist University in 1986.
MARK C. LUCHSINGER -- Fixed Income Principal and Portfolio Analyst/Trader.
Mr. Luchsinger is the newest senior member of the fixed income product team.
Prior to joining the Adviser in April of 1997, he had spent several years in
fixed income sales at First Boston Corporation, PaineWebber and Morgan Keegan
responsible for a wide array of security and client types. During Mr.
Luchsinger's investment career, he has also served as Chief Investment Officer
for Great American Reserve Insurance Company in Dallas, where he was responsi-
ble for the management of over $1 billion in fixed income and equity portfo-
lios; senior investment portfolio manager for Western Preferred Corporation in
Fort Worth; and investment manager for Scor Reinsurance Company in Irving. Mr.
Luchsinger is a Chartered Financial Analyst and earned his BBA from Bowling
Green State University in 1980.
DEBORAH J. ANDERSON -- Senior Portfolio Assistant. Ms. Anderson is responsi-
ble for all administrative staff and their duties associated with the fixed
income product management, including communication/liaison with all clients,
custodial banks, and brokerage relationships. She supervises all operational
aspects of fixed income security trading and works extensively with reporting
requirements for all clients and regulatory agencies. Prior to joining the Ad-
viser in 1988, Ms. Anderson served as a Trust Officer with Trust Company of
Texas and its predecessor, Southland Trust Co. She received a BBA in Account-
ing from the University of Texas at Arlington in 1974.
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to the
composite of separately managed accounts of the Adviser that are managed with
substantially similar (although not necessarily identical) objectives, poli-
cies and strategies as those of the Portfolio. The performance data for the
managed accounts is net of all fees and expenses. The investment returns of
the Portfolio may differ from those of the separately managed accounts because
such separately managed accounts may have fees and expenses that differ from
those of the Portfolio. Further, the separately managed accounts are not sub-
ject to investment limitations, diversification requirements and other re-
strictions imposed by the Investment Company Act of 1940 and Internal Revenue
Code; such conditions, if applicable, may have lowered the returns for sepa-
rately managed accounts. The results presented are not intended to predict or
suggest the return to be experienced by the Portfolio or the return an in-
vestor might achieve by investing in the Portfolio.
26
<PAGE>
BARROW, HANLEY, MEWHINNEY, & STRAUSS, INC.--BOND ACCOUNT
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
<TABLE>
<CAPTION>
LEHMAN BROTHERS
BARROW, HANLEY, MEWHINNEY & AGGREGATE
CALENDAR YEARS STRAUSS, INC. BOND INDEX
-------------- --------------------------- ---------------
<S> <C> <C>
1988.............................. 7.55% 7.89%
1989.............................. 14.52% 14.53%
1990.............................. 9.02% 8.96%
1991.............................. 16.52% 16.00%
1992.............................. 7.70% 7.40%
1993.............................. 10.86% 9.75%
1994.............................. (3.52)% (2.92)%
1995.............................. 17.68% 18.47%
1996.............................. 3.32% 3.63%
1997.............................. 9.60% 9.65%
3 months ended 3/31/98............ 1.63% 1.56%
Annualized........................ 9.10% 9.11%
Cumulative........................ 244.08% 244.35%
Ten-Year Mean
(1/1/88-12/31/97)............... 9.33% 9.34%
Value of $1 invested during the
period (1/1/88-3/31/98)......... $ 3.44 $ 3.44
</TABLE>
Notes:
1. The annualized return is calculated from monthly data, allowing for com-
pounding. Market Value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The cumulative return means that $1 invested in that account on January 1,
1988 had grown to $3.44 by March 31, 1998.
3. The 10-year mean is the arithmetic average of the annual returns for the
calendar years listed.
4. The Lehman Brothers Aggregate Bond Index is an unmanaged index which as-
sumes reinvestment of dividends and is generally considered representative
of securities similar to those invested in by the Adviser for the purpose
of the composite performance numbers set forth above.
5. The Adviser's average annual management fee over the period shown (1/1/88-
3/31/98) was 0.29% or 29 basis points. During the period, fees on the Ad-
viser's individual accounts ranged from 0.25% to 0.45% (25 basis points to
45 basis points). Net returns to investors vary depending on the manage-
ment fee.
27
<PAGE>
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
BHM&S Total Return Bond Portfolio...................................... 0.04%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
The UAM Fund fees are allocated among each of the Portfolios on the basis of
their relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, with its
principal office located at 211 Congress Street, Boston, Massachusetts 02110,
distributes the shares of the Fund. Under the Fund's Distribution Agreement
(the "Agreement"), the Distributor, as agent of the Fund, agrees to use its
best efforts as sole distributor of the Fund's shares. The Distributor does
not receive any fee or other compensation under the Agreement with respect to
the Portfolio's Institutional Class Shares offered in this Prospectus. The
Agreement continues in effect as long as it is approved at least annually by
the Fund's Board of Trustees. Those approving the Agreement must include a
majority of those Trustees who are neither parties to such Agreement nor
interested persons of any such party. The
28
<PAGE>
Agreement provides that the Fund will bear the costs of the registration of
its shares with the SEC and various states and the printing of its
prospectuses, its SAIs and its reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolios. The Agreement directs the Adviser to use its best efforts to ob-
tain the best available price and most favorable execution for all transac-
tions of the Portfolio. If consistent with the interests of the Portfolio, the
Adviser may select brokers on the basis of the research, statistical and pric-
ing services they provide to each Portfolio in addition to required services.
Such brokers may be paid a higher commission than that which another qualified
broker would have charged for effecting the same transaction, provided that
such commissions are paid in compliance with the Securities Exchange Act of
1934, as amended, and that the Adviser determines in good faith that such com-
mission is reasonable in terms either of the transaction or the overall re-
sponsibility of the Adviser to a Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of a Portfolio and one or more of these other clients served by the Adviser is
considered at or about the same, transactions in such securities will be allo-
cated among the Portfolio and clients in a manner deemed fair and reasonable
by the Adviser. Although there is no specified formula for allocating such
transactions, such allocations are subject to periodic review by the Fund's
Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which
29
<PAGE>
means that holders of more than 50% of shares voting for the election of
Trustees
can elect 100% of the Trustees if they choose to do so. A shareholder is enti-
tled to one vote for each full share held (and a fractional vote for each
fractional share held), then standing in his or her name on the books of the
Fund.
As of June 15, 1998, Fleet National Bank, Trustee, FBO Austin Diagnostic
Clinic Association 401k Profit Sharing Plan, held of record 28.1% of the out-
standing shares of the Portfolio's Institutional Class for which benefical
ownership is disclaimed or presumed disclaimed. The persons or organizations
owning 25% or more of the outstanding shares of the Portfolio may be presumed
to "control" (as that term is defined in the 1940 Act) the Portfolio. As a re-
sult, these persons or organizations could have the ability to vote a majority
of the shares of the Portfolio on any matter requiring the approval of share-
holders of the Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of a Portfolio. Service Class Shares bear certain expenses re-
lated to shareholder servicing and the distribution of such shares, and have
exclusive voting rights with respect to matters relating to such distribution
expenditures. The Board of Trustees of the Fund has authorized a third class
of shares, Advisor Class Shares, which is not currently being offered by this
Portfolio. Information about the Service Class Shares of the Portfolio is
available upon request by contacting the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of this Prospectus.
30
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE FUND'S STATEMENT OF AD-
DITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST NOT BE RE-
LIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES NOT CON-
STITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY
NOT LAWFULLY BE MADE.
31
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
32
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Barrow, Hanley, Mewhinney & Strauss, Inc.
One McKinney Plaza,
3232 McKinney Avenue,
15th Floor, Dallas, Texas 75204
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
BHM&S Total Return Bond Portfolio
Institutional Service Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 7
Investment Limitations..................................................... 13
Purchase of Shares......................................................... 14
Redemption of Shares....................................................... 18
Shareholder Services....................................................... 20
Service and Distribution Plans............................................. 22
Valuation of Shares........................................................ 23
Performance Calculations................................................... 24
Dividends, Capital Gains Distributions and Taxes........................... 24
Investment Adviser......................................................... 25
Adviser's Historical Performance........................................... 28
Administrative Services.................................................... 29
Distributor................................................................ 30
Portfolio Transactions..................................................... 30
General Information........................................................ 30
UAM Funds -- Institutional Service Class Shares............................ 33
</TABLE>
<PAGE>
UAM FUNDS BHM&S TOTAL RETURN
BOND PORTFOLIO
INSTITUTIONAL SERVICE CLASS
SHARES
- -------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. The BHM&S To-
tal Return Bond Portfolio offers two separate classes of shares: Institutional
Class Shares and Institutional Service Class Shares ("Service Class Shares").
Shares of each class represent equal, pro rata interests in a Portfolio and
accrue dividends in the same manner except that the Service Class Shares bear
fees payable by the class (at the rate of .25% per annum) to financial insti-
tutions for services they provide to the owners of such shares (see "Service
and Distribution Plans"). The securities offered in this Prospectus are Serv-
ice Class Shares of one diversified, no-load Portfolio of the Fund managed by
Barrow, Hanley, Mewhinney & Strauss, Inc.
BHM&S TOTAL RETURN BOND PORTFOLIO. BHM&S Total Return Bond Portfolio (the
"Portfolio") seeks to provide maximum long term total return consistent with
reasonable risk to principal by investing in investment grade fixed income se-
curities of varying maturities. Income return is expected to be a predominant
portion of the Portfolio's total return. Any capital return on the Portfolio
is dependent upon, among other factors, interest rate changes as well as the
average maturity and duration of the Portfolio. The Adviser believes that by
investing in undervalued securities with above average effective yields and
capital appreciation potential, the Portfolio will generate superior returns
over the long term while minimizing volatility and, therefore, downside risk.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the
SAI contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolios' Service Class Shares will incur. The Fund does not charge transac-
tion fees. However, transaction fees may be charged if a broker-dealer or
other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<CAPTION>
SERVICE CLASS SHARES
--------------------
<S> <C>
Sales Load Imposed on Purchases......................... NONE
Sales Load Imposed on Reinvested Dividends.............. NONE
Deferred Sales Load..................................... NONE
Redemption Fees......................................... NONE
Exchange Fee............................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(As A Percentage of Average Net Assets)
<TABLE>
<CAPTION>
SERVICE CLASS SHARES
--------------------
<S> <C>
Investment Advisory Fees (After Fee Waiver)............ 0.18%
12b-1 Fees (Including Shareholder Servicing Fees)+..... 0.25%
Other Expenses (After Fee Waiver)...................... 0.72%
----
Total Operating Expenses (After Fee Waiver)............ 1.15%*
====
</TABLE>
- -----------
+ The Service Class Shares may bear service fees of 0.25% of average daily net
assets of the Portfolio. Long-term shareholders may pay more than the eco-
nomic equivalent of the maximum front end sales charge permitted by the Na-
tional Association of Securities Dealers, Inc. (See "SERVICE AND DISTRIBU-
TION PLANS.")
* The Adviser intends to cap, to the extent of the current advisory fees, the
Portfolio's Service Class Shares' Total Operating Expenses (excluding
interest, taxes and extraordinary expenses), after the effect of expense
offsets, at 1.15% of average daily net assets through December 31, 1998. The
figures above include the effect of expense offsets. If expense offsets were
excluded, Total Operating Expenses of the Portfolio would not be affected.
(See "FINANCIAL HIGHLIGHTS.") Absent the Adviser's and/or other service
providers waiver of fees, the Investment Advisory Fees, Other Expenses and
Total Operating Expenses of the Portfolio's Service Class Shares would have
been 0.35%, 0.85% and 1.45%, respectively of average daily net assets. The
Adviser and other service providers may change or discontinue their fee
waivers at any time.
1
<PAGE>
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The expenses and fees listed above are based on the
Portfolio's Service Class Shares' operations during the fiscal year ended
April 30, 1998, as restated to reflect the current Investment Advisory Fees,
Other Expenses, and Total Operating Expenses of the Portfolio.
EXAMPLE
The following example illustrates expenses a Service Class shareholder would
pay on a $1,000 investment over various time periods assuming (1) a 5% annual
rate of return and (2) redemption at the end of each time period. The Portfo-
lio charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
BHM&S Total Return Bond Portfolio Service
Class Shares............................ $12 $37 $63 $140
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Barrow, Hanley, Mewhinney & Strauss, Inc. (the "Adviser") is a registered
investment adviser founded in 1979 specializing in the active management of
stock, bond and balanced portfolios for institutional, tax-exempt clients.
Founded in 1979, the firm is a wholly-owned subsidiary of United Asset Manage-
ment Corporation. The Adviser currently has $33 billion in assets under man-
agement. (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") at net asset value without a sales commission. Share purchases
may be made by sending investments directly to the Fund. The minimum initial
investment is $2,500. The minimum for subsequent investments is $100. The min-
imum initial investment for IRA accounts is $500. The minimum initial invest-
ment for spousal IRA accounts is $250. Certain exceptions to the initial or
minimum investment amounts may be permitted by the officers of the Fund. (See
"PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in the Portfo-
lio's shares automatically unless an investor elects to receive cash distribu-
tions. (See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
Prospective investors should consider the following: (1) The fixed income
securities held by the Portfolio will be affected by general changes in inter-
est rates resulting in increases or decreases in the value of the securities.
The value of fixed income securities can be expected to vary inversely to the
changes in prevailing interest rates, i.e., as interest rates decline, the
market value of fixed income securities tends to increase and vice versa; (2)
The Portfolio may purchase securities on a when-issued basis which do not earn
interest until issued and may decline or appreciate in market value prior to
their delivery to the Portfolio; (3) The Portfolio will invest in investment
grade debt securities, but reserves the right to hold securities that have
been downgraded. Adverse economic and corporate changes and changes in inter-
est rates may have a greater impact on issuers of lower rated debt securities
that the Portfolio may hold, which may lead to greater price volatility. Also,
lower rated securities may be more difficult to value accurately or sell in
the secondary market; (4) The Portfolio may invest in repurchase agreements
which entail a risk of loss should the seller default on its transaction; (5)
The Portfolio may lend its investment securities, which entails a risk of loss
should a borrower fail financially. (See "OTHER INVESTMENT POLICIES.")
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented for the Portfolio's Service Class
Shares. This table is part of the Portfolio's Annual Financial Statements in-
cluded in the Portfolio's 1998 Annual Report to Shareholders. The Report is
incorporated by reference into the Portfolio's SAI. The Portfolio's Annual Fi-
nancial Statements have been audited by PricewaterhouseCoopers LLP whose un-
qualified opinion thereon is also incorporated into the SAI. The following in-
formation should be read in conjunction with the Portfolio's 1998 Annual Re-
port to Shareholders. Further information about the Portfolio's performance is
contained in its Annual Report, which may be obtained without charge by call-
ing the telephone number on the Prospectus cover page.
<TABLE>
<CAPTION>
NOVEMBER 1,
YEAR ENDED YEAR ENDED 1995***
APRIL 30, APRIL 30, TO APRIL 30,
1998++ 1997++ 1996++
---------- ---------- ------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD....... $ 9.95 $ 9.84 $10.00
------- ------ ------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.................... 0.56 0.57 0.27
Net Realized and Unrealized Gain (Loss)
on Investments......................... 0.40 0.05 (0.27)
------- ------ ------
Total from Investment Operations....... 0.96 0.62 --
------- ------ ------
DISTRIBUTIONS
Net Investment Income.................... (0.53) (0.51) (0.16)
Net Realized Gain........................ (0.04) -- --
------- ------ ------
Total Distributions.................... (0.57) (0.51) (0.16)
------- ------ ------
NET ASSET VALUE, END OF PERIOD............. $ 10.34 $ 9.95 $ 9.84
======= ====== ======
TOTAL RETURN+.............................. 9.85% 6.47% (0.07)%**
======= ====== ======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (Thousands).... $15,732 $4,045 $2,871
Ratio of Expenses to Average Net Assets.. 0.95% 0.82% 0.83%*
Ratio of Net Investment Income to Average
Net Assets............................. 5.42% 5.78% 5.44%*
Portfolio Turnover Rate.................. 210% 151% 55%
Ratio of Voluntary Waived Fees and
Expenses Assumed by the Adviser to
Average Net Assets..................... 0.45% 1.43% 3.99%*
Ratio of Expenses to Average Net Assets
Including Expense Offsets.............. 0.94% 0.80% 0.80%*
</TABLE>
- -----------
* Annualized.
** Not Annualized.
*** Commencement of Operations.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the period.
++ Per share amounts are based on average outstanding shares.
5
<PAGE>
INVESTMENT OBJECTIVE
The objective of the Portfolio is to provide maximum long-term total return
consistent with reasonable risk to principal by investing in investment grade
fixed income securities of varying maturities. Income return is expected to be
a predominant portion of the Portfolio's total return. Any capital return on
the Portfolio is dependent upon, among other factors, interest rate changes as
well as the average maturity and duration of the Portfolio. The Adviser be-
lieves that by investing in undervalued securities with above average effec-
tive yields and capital appreciation potential, the Portfolio will generate
superior returns over the long term while minimizing volatility and, there-
fore, downside risk.
INVESTMENT POLICIES
The Portfolio seeks to achieve its objective by investing at least 90% of
its total assets in a diversified portfolio of the following dollar-denomi-
nated investment grade issues of varying maturities, with an intermediate av-
erage maturity: U.S. Treasuries and Agencies; zero coupon obligations; mort-
gage-backed securities; asset-backed securities; corporate bonds; municipal
bonds; and domestic, Yankee dollar and Eurodollar bonds (See "OTHER INVESTMENT
POLICIES."). These issues may have fixed, variable or floating rates of inter-
est. Bond and note futures may be used for hedging interest rate risk for the
Portfolio to an average weighted duration comparable to the Salomon Brothers'
Broad or Lehman Brothers Aggregate Indices.
The Adviser expects to actively manage the Portfolio in order to meet the
investment objective. To produce favorable returns, the Adviser will invest in
securities that it believes to be undervalued, generating an effective yield
advantage versus the market. To control the volatility of returns, the Portfo-
lio will exhibit a high current yield, a high quality and a conservative matu-
rity structure.
The Adviser's decision process will focus on security selection, sector con-
centration and yield curve positioning. The Adviser will not engage in eco-
nomic forecasts in an attempt to "time the market" since it believes that
there are too many economic and political variables on a domestic and interna-
tional basis to do so successfully on a consistent basis. Therefore, the Port-
folio will maintain a conservative intermediate maturity structure, with secu-
rities being diversified along the yield curve. The Portfolio's average
weighted maturity will generally be ten years or less, with the average
weighted duration comparable to that of the Salomon Brothers' Broad Investment
Grade Index which is approximately five years. Duration compares interest rate
risk between securities with different coupons and different maturities, sum-
marizing in a single number the price sensitivity of a bond -- how a bond's
maturity and coupon rate affect its exposure to interest rate risk. Duration
involves the application of several principles: as the maturity of a bond in-
creases, duration increases; as the coupon of a bond increases, duration de-
creases; generally, the lower the coupon payment, the higher the duration; and
duration
6
<PAGE>
decreases as the frequency of the coupon payment increases. Generally, 10% or
less of the Portfolio's assets will be invested in various short-term invest-
ments. Please see "SHORT-TERM INVESTMENTS" for a list of the short-term in-
struments in which the Portfolio may invest.
The Adviser's security selection process begins by analyzing a bond's yield
to maturity premium (or spread) versus the most recently issued U.S. Treasury
of similar maturity. Having identified bonds with an above-average premium,
the Adviser will then evaluate those factors that will influence the bond's
future premium (i.e., credit quality, security structure, supply/demand rela-
tionships, etc.). The objective of this process is to identify those issues
whose yield premium will compress or narrow over a wide range of potential in-
terest rate change, supporting superior long term performance. Furthermore,
the Adviser will concentrate the Portfolio's holdings in industry sectors and
maturity ranges that it believes are undervalued while seeking a prudent level
of diversification.
The Portfolio will invest in investment grade bonds which have one of the
four highest rating categories (i.e. Aaa, Aa, A or Baa by Moody's Investors
Service ("Moody's"), AAA, AA, A or BBB by Standard & Poor's Ratings Services
("S&P"), Fitch IBCA, or Duff and Phelps Credit Rating Service) at the time of
purchase. Bonds rated Baa or BBB have speculative characteristics and may be
more sensitive to changes in the economy and the financial condition of is-
suers than higher rated bonds. The Adviser also reserves the right to retain
securities which are downgraded by one or both of the rating agencies if, in
the Adviser's judgment, retention of the securities is warranted. The Portfo-
lio's SAI contains a more detailed description of bond ratings.
OTHER INVESTMENT POLICIES
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's or if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and
7
<PAGE>
(iii) in the case of foreign branches of U.S. banks, the security is, in the
opinion of the Adviser, of an investment quality comparable with other debt
securities which may be purchased by the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money market instruments including variable rate demand notes
and tax-exempt money instruments. By entering into these investments on a
joint basis, the Portfolio may earn a higher rate of return on investments
relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
8
<PAGE>
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
9
<PAGE>
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company
nor may it acquire more than 3% of the voting securities of any investment
company. The Portfolio will indirectly bear its proportionate share of any
management fees paid by an investment company in which it invests in addition
to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may invest up to 15% of its
net assets in illiquid securities. Prices realized from the sales of these se-
curities could be more or less than those originally paid by the Portfolio or
less than what may be considered the fair value of such securities.
MORTGAGE-BACKED SECURITIES
The Portfolio may invest in mortgage-backed securities. Mortgage-backed se-
curities are collateralized by pools of mortgages assembled for subsequent
sale to investors by various governmental agencies and sponsored organizations
as well as by private issuers. The underlying assets collateralizing the mort-
gage-backed securities may include single-family, multifamily and commercial
properties. The two fundamental forms of mortgage-backed securities are pass-
throughs and collateralized mortgage obligations ("CMOs"). Pass-throughs pro-
duce monthly payments of principal and interest from the underlying mortgages.
CMOs divide the
10
<PAGE>
cash flows generated from the underlying mortgages or mortgage pass-through
securities into different segments known as "tranches" which are then retired
sequentially over time in order of priority. The market value and yield of
mortgage-backed securities will fluctuate due to market interest rate change
and early prepayments of the underlying mortgages. As prepayment rates on
mortgages vary widely, it is difficult to accurately predict the average matu-
rity of a particular pool of mortgages or tranches of CMOs. Although mortgage-
backed securities may offer higher yields than those available from other
types of securities, they may be less effective than other types of securities
as a means of "locking in" an attractive rate for an extended period because
of the prepayment feature. Prepayment risk has two important effects. First,
like bonds in general mortgage-backed securities will generally decline when
interest rates rise. Second, when interest rates fall and additional mortgage
prepayments must be reinvested at lower interest rates, a Portfolio's rate of
dividend income may be reduced. Mortgage-backed securities in which the Port-
folio may invest will either carry a guarantee from an agency of the U.S. Gov-
ernment or a private issuer of the timely payment of principal and interest or
are suitably structured to be considered by the Adviser to be of investment
grade quality.
ASSET-BACKED SECURITIES
The Portfolio may invest in asset-backed securities. Asset-backed securities
are collateralized by short maturity loans such as automobile receivables,
credit card receivables, or other types of receivables or assets, the payments
from which are passed through to the security holder. Credit support for as-
set-backed securities may be based on the underlying assets and/or provided
through credit enhancements by a third party. Credit enhancement techniques
include letters of credit, insurance bonds, limited guarantees (which are gen-
erally provided by the issuer), senior-subordinated structures and over-
collateralization. The value of these securities may be significantly affected
by changes in interest rates, the market's perceptions of the issuers and the
creditworthiness of the parties involved.
MUNICIPAL OBLIGATIONS
Municipal obligations include notes, bonds and other securities issued by or
on behalf of states, territories and possessions of the U.S. and the District
of Columbia and their political subdivisions, agencies and instrumentalities.
The interest on such municipal obligations will normally be exempt from fed-
eral income tax. These bonds may be general obligation bonds secured by the
issuer's pledge of its full faith, credit and taxing power for the payment of
principal and interest, or they may be revenue bonds payable from specific
revenue sources, but are not generally backed by the issuer's taxing power.
These obligations may include private activity bonds where payment is the re-
sponsibility of the private industrial user of the facility financed by the
bonds. Municipal notes are issued to meet short-term funding requirements of
the issuer and include construction loan notes, short-term
11
<PAGE>
discount notes, tax-exempt commercial paper, demand notes and similar instru-
ments. Municipal bonds will be rated investment grade by Moody's and S&P, as
described above. Investment grade municipal notes will be rated MIG1, MIG2 or
MIG3 by Moody's, or SP-1 or SP-2 by S&P or, if unrated, determined by the Ad-
viser to be of comparable quality. Please refer to the Portfolio's SAI for a
detailed description of municipal note ratings.
YANKEE DOLLAR AND EURODOLLAR SECURITIES
Yankee dollar securities are U.S. dollar-based obligations issued inside the
United States by foreign entities. Eurodollar securities are U.S. dollar-based
obligations issued outside the United States by domestic or foreign entities.
Investment in these securities involves certain risks which are not typically
associated with investing in domestic securities. For example, non U.S.-based
issuers are not subject to the same accounting, auditing and financial report-
ing standards as are domestic issuers. There may be less publicly-available
information about non-U.S.-based issuers which may make it difficult to make
investment decisions. Political factors may have an impact in the form of con-
fiscatory taxation, expropriation or political instability in international
markets. Some foreign governments also levy withholding taxes against dividend
and interest income. Although in some countries a portion of the taxes is re-
coverable, the non-recovered portion of foreign withholding taxes will reduce
the income the Portfolio receives from the companies comprising its invest-
ments.
ZERO COUPON SECURITIES
A portion of the Portfolio may be invested in zero coupon securities which
are fixed income securities that do not make regular interest payments. Zero
coupon securities are sold at substantial discounts from their face value. The
difference between a zero coupon security's issue or purchase price and its
face value represents the imputed interest an investor will earn if the obli-
gation is held until maturity. Zero coupon securities may offer the Portfolio
the opportunity to earn higher yields than those available on ordinary inter-
est paying obligations of similar credit quality and maturity. However, the
prices of zero coupon securities may also exhibit greater price volatility
than ordinary fixed income securities because of the manner in which their
principal and interest are returned to the investor. The Portfolio will accrue
income on such investments for tax and accounting purposes which is distribut-
able to shareholders. Since no cash is received at the time of accrual, the
Portfolio may be required to liquidate portfolio securities to satisfy its
distribution obligations.
FUTURES CONTRACTS AND OPTIONS
In order to remain fully invested and to reduce transaction costs, the Port-
folio may invest in bond futures, interest rate futures contracts and options.
Because transaction costs associated with futures and options may be lower
than costs of investing in bonds directly, the use of index futures and op-
tions to facilitate cash flows may reduce a Portfolio's overall transaction
costs. The Portfolio may enter
12
<PAGE>
into futures contracts provided that not more than 5% of the Portfolio's as-
sets are required as a margin deposit to secure obligations under such con-
tracts. The Portfolio will engage in futures and options transactions for
hedging purposes only and not for speculative purposes.
Futures and options can be volatile and involve various degrees and types of
risk. If the Portfolio judges market conditions incorrectly or employs a
strategy that does not correlate well with its investments, use of futures and
options contracts could result in a loss. The Portfolio could also suffer
losses if it is unable to liquidate its position due to an illiquid secondary
market. In the opinion of the Trustees of the Fund, the risk that the Portfo-
lio will be unable to close out a futures position or options contract will be
minimized by only entering into futures contracts or options transactions
traded on national exchanges and for which there appears to be a liquid sec-
ondary market.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
13
<PAGE>
The investment objectives of the Portfolio are fundamental and may be
changed only with the approval of the holders of a majority of the outstanding
shares of the Portfolio. Except for limitations (a), (b), (d), (e) and (f)(i),
the Portfolio's investment limitations and policies described in this Prospec-
tus and in the SAI are not fundamental and may be changed by the Fund's Board
of Trustees upon reasonable notice to investors. All other investment limita-
tions described here and in the SAI are fundamental policies and may be
changed only with the approval of the holders of a majority of the outstanding
shares of the Portfolio. If a percentage limitation on investment or utiliza-
tion of assets as set forth above is adhered to at the time an investment is
made, a later change in percentage resulting from changes in the value or to-
tal cost of the Portfolio's assets will not be considered a violation of the
restriction.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value next deter-
mined after an order is received by the Fund and payment is received by the
Fund or its designated Service Agent. (See "VALUATION OF SHARES.") The minimum
initial investment required is $2,500. The minimum initial investment for IRA
accounts is $500. The minimum initial investment for spousal IRA accounts is
$250. Certain exceptions may be permitted by the officers of the Fund.
The Portfolio issues two classes of shares: Institutional Class and Service
Class. The two classes of shares each represent interests in the same portfo-
lio of investments, have the same rights and are identical in all respects,
except that the Service Class Shares offered by this Prospectus bear share-
holder servicing expenses and distribution plan expenses and have exclusive
voting rights with respect to the Rule 12b-1 Distribution Plan pursuant to
which the distribution fee may be paid. The two classes have different ex-
change privileges. (See "SHAREHOLDER SERVICES--EXCHANGE PRIVILEGE") The net
income attributable to Service Class Shares and the dividends payable on Serv-
ice Class Shares will be reduced by the amount of the shareholder servicing
and distribution fees; accordingly, the net asset value of the Service Class
Shares will be reduced by such amounts.
Shares of the Portfolio may be purchased by customers of broker/dealers or
other financial intermediaries ("Service Agents") that have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents also impose additional or different conditions or other account
fees on the purchase and redemption of Portfolio shares, which are not subject
to the Rule 12b-1 Service and Distribution Plans. They may include transaction
fees and/or service fees paid by the Fund from the Fund assets attributable to
the Service Agent and, would not be imposed if shares of the Portfolio were
purchased directly from the Fund or the Distributor. The Service Agents may
provide shareholder services to their customers that are not available to a
shareholder dealing directly with the
14
<PAGE>
Fund. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding any additional or differ-
ent purchases and redemptions conditions. Shareholders who are customers of
Service Agents should consult their Service Agent for information regarding
these fees and conditions. A salesperson and any other person entitled to re-
ceive compensation for selling or servicing Portfolio shares may receive dif-
ferent compensation with respect to one particular class of shares over an-
other in the Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase or redemp-
tion orders on behalf of clients and customers, with payment to follow no
later than a Portfolio's pricing on the following business day. If payment is
not received by the Fund's Sub-Transfer Agent, Chase Global Funds Services
Company ("CGFSC") by such time, the Service Agent could be held liable for re-
sulting fees or losses. A Portfolio may be deemed to have received a purchase
or redemption order when a Service Agent, or, if applicable, its authorized
designee, accepts the order. Orders received by the Fund in proper form will
be priced at the Portfolio's net asset value next computed after they are ac-
cepted by a Service Agent or its authorized designee. Service Agents are re-
sponsible to their customers and the Fund for timely transmission of all sub-
scription and redemption requests, investment information, documentation and
money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application, and mail it together with a check pay-
able to "UAM Funds," to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds."
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired, and the name of the bank
15
<PAGE>
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that day's price. An account number and a wire control number will be
provided to you in addition to wiring instructions. Next,
. instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name
Your Account Number
Your Account Name
Wire Control Number
(assigned by UAM Funds Service Center)
. Forward a completed Application to the UAM Funds Service Center at the
address shown on the Form. Federal Funds purchases will be accepted only
on days when the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased is identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
16
<PAGE>
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or reject purchase orders when, in the judgment of
management, such suspension or rejection is in the best interests of the Fund.
The Portfolio is intended to be a long-term investment vehicle and is not de-
signed to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases can be disruptive to efficient
portfolio management and, consequently, can be detrimental to a Portfolio's
performance and its shareholders. Accordingly, if the Fund's management deter-
mines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of shares will be made in full and fractional shares calculated to
three decimal places. Certificates for whole shares will be issued upon writ-
ten request by the shareholder. Certificates for fractional shares will not be
issued.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon
17
<PAGE>
their sale by the Portfolio under the Securities Act of 1933, or
otherwise; and
. the value of any such securities (except U.S. Government
securities) being exchanged together with other securities of the
same issuer owned by the Portfolio will not exceed 5% of the net
assets of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone, at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of your shares depending
on the market value of the investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed);
. redemption of certificated shares by telephone.
18
<PAGE>
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address, or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center or a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Board of Trustees determines that it would be detrimental to the best
interests of remaining shareholders of the Fund to make payment wholly or
partly in cash, the Fund may pay redemption proceeds in whole or in part by a
distribution
19
<PAGE>
in-kind of liquid securities held by the Portfolio in lieu of cash in confor-
mity with applicable rules of the SEC. Investors may incur brokerage charges
on the sale of portfolio securities received in payment of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Service Class Shares of the Portfolio may be exchanged for Service Class
Shares of any other UAM Funds Portfolio. (See the list of Portfolios of the
UAM Funds at the end of this Prospectus.) Exchange requests should be made by
contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility
20
<PAGE>
for the authenticity of telephoned instructions, see "REDEMPTION OF SHARES --
BY TELEPHONE". An exchange into another UAM Funds Portfolio is a sale of
shares and may result in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investments made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or by pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any
21
<PAGE>
time by the Fund. A shareholder may elect at any time, in writing, to termi-
nate participation in the Systematic Withdrawal Plan. Such written election
must be sent to and received by the Fund before a termination becomes effec-
tive. There is currently no charge to the shareholder for a Systematic With-
drawal Plan.
SERVICE AND DISTRIBUTION PLANS
Under the Service Plan for Service Class Shares, the Fund may enter into
service agreements with Service Agents (broker-dealers or other financial in-
stitutions) who receive fees with respect to the Fund's Service Class Shares
owned by shareholders for whom the Service Agent is the dealer or holder of
record, or for whom the Service Agent performs personal services and/or share-
holder account maintenance. These fees are paid out of the assets allocable to
Service Class Shares to the Distributor, to the Service Agent directly or
through the Distributor. The Fund reimburses the Distributor or the Service
Agent, as the case may be, for payments made at an annual rate of up to 0.25
of 1% of the average daily value of each Service Class Share. Each item for
which a payment may be made under the Service Plan constitutes personal serv-
ice and/or shareholder account maintenance and may constitute an expense of
distributing Fund Service Class shares as the SEC construes such term under
Rule 12b-1. The fees payable for servicing reflect actual expenses incurred up
to the limits described herein.
Banks are engaged to act as Service Agent only to perform administrative and
shareholder servicing functions, including transaction-related agency services
for their customers. If a bank is prohibited from so acting, alternative means
for continuing the servicing of its shareholders would be sought and the
shareholder clients of the bank would remain Fund shareholders.
The Distribution Plan and Service Plan (the "Plans") provide generally that
the Portfolio may incur distribution and service costs under the Plans which
may not exceed in the aggregate 0.75% per annum of the Portfolio's net assets.
The Board has currently limited payments under the Plans to 0.50% per annum of
the Portfolio's net assets. The Service Class Shares offered by this Prospec-
tus currently are not making payments under the Distribution Plan. Upon imple-
mentation, the Distribution Plan would permit payments to the Distributor,
broker-dealers, other financial institutions, sales representatives or other
third parties who render promotional and distribution services, for items such
as sales compensation and marketing and overhead expenses.
The Plans were adopted pursuant to Rule 12b-1 under the 1940 Act. Although
the Plans may be amended by the Board of Trustees, any change in the Plans
which would materially increase the amounts authorized to be paid under the
Plans must be approved by shareholders of the class involved. The Plans may be
terminated by the Board of Trustees or Service Class shareholders. The amounts
and purposes of expenditures under the Plans are reported to the Board of
Trustees quarterly.
22
<PAGE>
The amounts allowable under the Plans for each class of Shares of the Portfo-
lio are limited by the terms of such Plan and under certain rules of the Na-
tional Association of Securities Dealers, Inc.
In addition to payments by the Fund under the Plans, the Distributor, United
Asset Management Corporation, the parent company of UAMFSI, and of the Adviser
or any of their affiliates, may, at its own expense, compensate a Service
Agent or other person for marketing, shareholder servicing, recordkeeping
and/or other services performed with respect to the Fund, a Portfolio or any
Class of Shares of a Portfolio. The person making such payments may do so out
of its revenues, its profits or any other source available to it. Such serv-
ices arrangements, when in effect, are made generally available to all quali-
fied service providers. The Adviser may compensate its affiliated companies
for referring investors to the Portfolio.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. ("Smith Barney") under which Smith Barney provides certain defined con-
tribution plan marketing and shareholder services and receives from such enti-
ties an amount equal to up to 33.3% of the portion of the investment advisory
fees attributable to the invested assets of Smith Barney's eligible customer
accounts without regard to any expense limitation in addition to amounts pay-
able to all selling dealers. The Fund also compensates Smith Barney for serv-
ices it provides to certain defined contribution plan shareholders that are
not otherwise provided by UAMFSI.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the NYSE on each day that the NYSE is open for
business.
Bonds and other fixed income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities. Securities purchased with remaining
maturities of 60 days or less are valued at amortized cost when the Board of
Trustees determines that amortized cost reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Fund's Board of Trustees.
23
<PAGE>
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all bond funds. As
this differs from other accounting methods, the quoted yield may not equal the
income actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount, except that service fees, distribution charges and
any incremental transfer agency costs relating to Service Class Shares will be
borne exclusively by that class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the telephone number on the cover of this
Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, the Portfolio will normally distribute them
annually. All dividends and capital gains distributions will be automatically
reinvested in additional
24
<PAGE>
shares of the Portfolio unless the Fund is notified in writing that the share-
holder elects to receive distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by each Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
The Adviser is a registered investment adviser formed in 1979. Its business
offices are located at One McKinney Plaza, 3232 McKinney Avenue, 15th Floor,
Dallas, Texas 75204. The Adviser is a wholly-owned subsidiary of United Asset
Management Corporation ("UAM"), a holding company, and provides and offers
25
<PAGE>
investment management services to corporate, public and Taft-Hartley employee
benefit plans, foundations, endowments, health care and other institutions and
investors. The Adviser currently has $33 billion in assets under management.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 0.35%. The Adviser intends, to waive a por-
tion of its advisory fees, if necessary, to keep the Portfolio's Service Class
Shares total operating expenses from exceeding 1.15% of average daily net as-
sets through December 31, 1998. The Adviser will not be reimbursed by the Fund
for any advisory fees which are waived for a given year.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Adviser and its parent company may also make payments to
unaffiliated brokers who perform distribution, marketing, shareholder and
other services with respect to the Portfolio.
The investment professionals at the Adviser responsible for the day-to-day
management of the Portfolio and their qualifications are as follows:
JOHN S. WILLIAMS -- Fixed Income Principal and the first fixed income port-
folio manager at the Adviser in 1983. Mr. Williams has also managed balanced
and municipal portfolios during his 21 year investment career. Prior to join-
ing the Adviser, he was responsible for the management of all fixed income as-
sets at Southland Trust, Dallas, Texas, and prior to that was a portfolio man-
ager and securities analyst at InterFirst Bank Dallas Trust Department. Mr.
Williams has served on the Advisory Committee for the Texas Teachers Retire-
ment System and is an active member in the Dallas Investment Analysts Society.
He currently is a Director of United Asset Management Corporation. Mr. Wil-
liams is a Chartered Financial Analyst, earning his MBA in 1976 and BBA in
1975 from Texas Christian University.
DAVID R. HARDIN -- Fixed Income Principal and portfolio manager. Prior to
joining the Adviser in 1987, Mr. Hardin was the Vice President and Director of
the Fixed Income Group of RepublicBank Dallas Trust Department. In that posi-
tion, he was responsible for the management of all taxable and tax-exempt
fixed income assets of the Trust Division, including all separately managed
accounts, collective investment fund products, and the creation of and manage-
ment of an SEC-registered mutual fund. Prior to attaining the Director's posi-
tion, Mr. Hardin was a taxable portfolio manager and also served as the credit
analyst for the Trust Division. He started his investment career as a private
placement credit analyst while employed by American General Insurance Co. in
Houston in 1976. Mr.
26
<PAGE>
Hardin received an M.Sc. from The London School of Economics in 1975 and a BBA
from Texas Christian University in 1973.
STEPHEN M. MILANO -- Fixed Income Principal and portfolio manager. Prior to
joining the Adviser in 1990, Mr. Milano was employed at Salomon Brothers, Inc.
in New York as a Vice President of the Fixed Income Strategy Group. In that
role he was a specialist in developing portfolio structure and strategies for
active management of taxable assets. While at Salomon he also served as Prod-
uct Sales Manager for International Fixed Income Securities and as a Mortgage
and Government Specialist. Prior to joining Salomon, Mr. Milano was employed
as a portfolio manager and trader at Equitable Life Assurance Society. He re-
ceived his BS in Economics with a concentration in Finance from the Wharton
School of the University of Pennsylvania in 1980.
J. SCOTT MCDONALD -- Fixed Income Principal and Portfolio Analyst/Trader.
Mr. McDonald joined the Adviser in 1995 to serve as a security and portfolio
specialist for the Fixed Income Group. In addition to security and portfolio
analyst, he is responsible for systems analytics used in the evaluation of
effective/option adjusted yield measurements for all securities and portfo-
lios. He also serves as compliance monitor of all fixed income portfolios to
ensure commonality of structure and diversification. Mr. McDonald previously
served as the Senior Vice President and Portfolio Manager at Life Partners
Group, Inc. in Dallas. While with Life Partners, he was responsible for imple-
menting investment strategy for $3 billion in assets. Additionally, he has
been employed by Texas Commerce Bank Houston as a Credit Supervisor and Lend-
ing Officer. He received his MBA in 1991 from the University of Texas at Aus-
tin and his BBA from Southern Methodist University in 1986.
MARK C. LUCHSINGER -- Fixed Income Principal and Portfolio Analyst/Trader.
Mr. Luchsinger is the newest senior member of the fixed income team. Prior to
joining the Adviser in April of 1997, he had spent several years in fixed in-
come sales at First Boston Corporation, PaineWebber and Morgan Keegan respon-
sible for a wide array of security and client types. During Mr. Luchsinger's
investment career, he has also served as Chief Investment Officer for Great
American Reserve Insurance Company in Dallas, where he was responsible for the
management of over $1 billion in fixed income and equity portfolios, senior
investment portfolio manager for Western Preferred Corporation in Fort Worth;
and investment manager for Scor Reinsurance Company in Irving. Mr. Luchsinger
is a Chartered Financial Analyst and earned his BBA from Bowling Green State
University in 1980.
DEBORAH J. ANDERSON -- Senior Portfolio Assistant. Ms. Anderson is responsi-
ble for all administrative staff and their duties associated with the fixed
income product management, including communication/liaison with all clients,
custodial banks, and brokerage relationships. She supervises all operational
aspects
27
<PAGE>
of fixed income security trading and works extensively with reporting require-
ments for all clients and regulatory agencies. Prior to joining the Adviser in
1988, Ms. Anderson served as a Trust Officer with Trust Company of Texas and
its predecessor, Southland Trust Co. She received a BBA in Accounting from the
University of Texas at Arlington in 1974.
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to the
composite of separately managed accounts of the Adviser that are managed with
substantially similar (although not necessarily identical) objectives, poli-
cies and strategies as those of the Portfolio. The performance data for the
managed accounts is net of all fees and expenses. The investment returns of
the Portfolio may differ from those of the separately managed accounts because
such separately managed accounts may have fees and expenses that differ from
those of the Portfolio. Further, the separately managed accounts are not sub-
ject to investment limitations, diversification requirements and other re-
strictions imposed by the Investment Company Act of 1940 and Internal Revenue
Code; such conditions, if applicable may have lowered the returns for the sep-
arately managed accounts. The results presented are not intended to predict or
suggest the return to be experienced by the Portfolio or the return an in-
vestor might achieve by investing in the Portfolio.
BARROW, HANLEY, MEWHINNEY & STRAUSS, INC. -- BOND ACCOUNT
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
<TABLE>
<CAPTION>
BARROW, HANLEY, MEWHINNEY & LEHMAN BROTHERS AGGREGATE
CALENDAR YEARS STRAUSS, INC. BOND INDEX
-------------- --------------------------- -------------------------
<S> <C> <C>
1988.................... 7.55% 7.89%
1989.................... 14.52% 14.53%
1990.................... 9.02% 8.96%
1991.................... 16.52% 16.00%
1992.................... 7.70% 7.40%
1993.................... 10.86% 9.75%
1994.................... (3.52)% (2.92)%
1995.................... 17.68% 18.47%
1996.................... 3.32% 3.63%
1997.................... 9.60% 9.65%
3 months ended 3/31/98.. 1.63% 1.56%
Annualized.............. 9.10% 9.11%
Cumulative.............. 244.08% 244.35%
Ten-Year Mean (1/1/88-
12/31/97)............. 9.33% 9.34%
Value of $1 invested
during the period
(1/1/88-3/31/98)...... $ 3.44 $ 3.44
</TABLE>
28
<PAGE>
Notes:
1. The annualized return is calculated from monthly data, allowing for com-
pounding. Market Value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The cumulative return means that $1 invested in the account on January 1,
1988 had grown to $3.44 by March 31, 1998.
3. The 10-year mean is the arithmetic average of the annual returns for the
calendar years listed.
4. The Lehman Brothers Aggregate Bond Index is an unmanaged index, which as-
sumes reinvestment of dividends and is generally considered representative
of securities similar to those invested in by the Adviser for the purpose
of the composite performance numbers set forth above.
5. The Adviser's average annual management fee over the period shown (1/1/88-
3/31/98) was 0.29% or 29 basis points. During the period, fees on the Ad-
viser's individual accounts ranged from 0.25% to 0.45% (25 basis points to
45 basis points). Net returns to investors vary depending on the manage-
ment fee.
ADMINISTRATIVE SERVICES
UAM Fund Services Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
BHM&S Total Return Bond Portfolio...................................... 0.04%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
The UAM Fund fees are allocated among each of the Portfolios on the basis of
their relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
29
<PAGE>
DISTRIBUTOR
UAM Fund Distributors, Inc. a wholly-owned subsidiary of UAM, with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or other compensation under the Agreement with respect to the
Portfolio's Service Class Shares (except as described under "Service and Dis-
tribution Plans" above). The Agreement continues in effect as long as it is
approved at least annually by the Fund's Board of Trustees. Those approving
the Agreement must include a majority of those Trustees who are neither par-
ties to such Agreement nor interested persons of any such party. The Agreement
provides that the Fund will bear the costs of the registration of its shares
with the SEC and various states and the printing of its prospectuses, its SAIs
and its reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to each Portfolio in addition to required services. Such
brokers may be paid a higher commission than that which another qualified bro-
ker would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934,
as amended, and that the Adviser determines in good faith that such commission
is reasonable in terms either of the transaction or the overall responsibility
of the Adviser to a Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of a Portfolio and one or more of these other clients served by the Adviser is
considered at or about the same time, transactions in such securities will be
allocated among the Portfolio and clients in a manner deemed fair and reason-
able by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
30
<PAGE>
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Fleet National Bank, Trustee, FBO Austin Diagnostic
Clinic Association 401K Profit Sharing Plan, held of record 28.1% of the out-
standing shares of the Portfolio's Institutional Class for which beneficial
ownership is disclaimed or presumed disclaimed. The persons or organizations
owning 25% or more of the outstanding shares of the Portfolio may be presumed
to "control" (as that term is defined in the 1940 Act) the Portfolio. As a re-
sult, these persons or organizations could have the ability to vote a majority
of the shares of the Portfolio on any matter requiring the approval of share-
holders of such Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of a Portfolio. Service Class Shares bear certain expenses re-
lated to shareholder servicing and the distribution of such shares, and have
exclusive voting rights with respect to matters relating to such distribution
expenditures. The Board of Trustees of the Fund has authorized a third class
of shares, Advisor Class Shares, which is not currently being offered by this
Portfolio. Information about the Institutional Class Shares of the Portfolio
is available upon request by contacting the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
31
<PAGE>
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
32
<PAGE>
UAM FUNDS -- INSTITUTIONAL SERVICE CLASS SHARES
BHM&S Total Return Bond Portfolio
DSI Disciplined Value Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TJ Core Equity Portfolio
33
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Barrow, Hanley, Mewhinney & Strauss, Inc.
One McKinney Plaza,
3232 McKinney Avenue,
15th Floor, Dallas, Texas 75204
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
Chicago Asset Management
Intermediate Bond Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 8
Investment Limitations..................................................... 15
Purchase of Shares......................................................... 16
Redemption of Shares....................................................... 20
Shareholder Services....................................................... 22
Valuation of Shares........................................................ 24
Performance Calculations................................................... 25
Dividends, Capital Gains Distributions and Taxes........................... 25
Investment Adviser......................................................... 26
Adviser's Historical Performance........................................... 28
Administrative Services.................................................... 29
Distributor................................................................ 30
Portfolio Transactions..................................................... 30
General Information........................................................ 31
UAM Funds -- Institutional Class Shares.................................... 33
</TABLE>
<PAGE>
UAM FUNDS
CHICAGO ASSET MANAGEMENT
INTERMEDIATE BOND PORTFOLIO
INSTITUTIONAL CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. The Chicago As-
set Management Intermediate Bond Portfolio currently offers only one class of
shares. The securities offered in this Prospectus are Institutional Class
Shares of one diversified, no-load Portfolio of the Fund managed by Chicago As-
set Management Company.
CHICAGO ASSET MANAGEMENT INTERMEDIATE BOND PORTFOLIO. Chicago Asset Manage-
ment Intermediate Bond Portfolio (the "Portfolio") seeks a high level of cur-
rent income consistent with moderate interest rate exposure by investing pri-
marily in investment grade bonds with an average weighted maturity between 3
and 10 years.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction expenses. However, transaction fees may be charged if a broker-
dealer or other financial intermediary deals with the Fund on your behalf.
(See "PURCHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fees........................................................... NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(As a Percentage of Average Net Assets)
<TABLE>
<S> <C>
Investment Advisory Fees (After Fee Waivers).......................... 0.00%
12b-1 Fees............................................................ NONE
Other Expenses (After Expenses Assumed or Waived)..................... 0.80%
----
Total Operating Expenses (After Fee Waiver and Expenses Assumed)...... 0.80%*
====
</TABLE>
- -----------
* Absent the fees waived and expenses assumed, Investment Advisory Fees, Other
Expenses and Total Operating Expenses for the Portfolio would have been
0.48%, 1.25% and 1.73%, respectively. The Total Operating Expenses includes
the effect of expense offsets. If expense offsets were excluded, Total Oper-
ating Expenses of the Portfolio would not be affected. Until further notice,
the Adviser and certain other service providers have voluntarily agreed to
waive their fees and/or to assume certain operating expenses to keep the
Portfolio's total annual operating expenses (excluding interest, taxes and
extraordinary expenses), after the effect of expense offsets, from exceeding
0.80% of average daily net assets. The Adviser and certain other service
providers may change or discontinue their fee waivers and expense assump-
tions at any time.
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's operations during the fiscal year ended April 30, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of the time period indicated. The Portfo-
lio charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Chicago Asset Management Intermediate Bond
Portfolio Institutional Class Shares.... $ 8 $26 $44 $99
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Chicago Asset Management Company (the "Adviser") is a registered investment
adviser, founded in 1983 and specializing in the active management of stocks,
bonds and balanced portfolios for institutional, tax-exempt clients. As of De-
cember 31, 1987, the Adviser had over $2 billion in assets under management.
(See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,000. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in Portfolio
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services Inc. ("UAMFSI"), a wholly-owned subsidiary of United Asset
Management Corporation, is responsible for performing and overseeing adminis-
tration, fund accounting, dividend disbursing and transfer agency services
provided to the Fund and its Portfolios by third-party service providers. (See
"ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Prospective investors
should consider the following: (1) The Portfolio may engage in various strate-
gies to seek to hedge its investments against movements in security prices,
interest rates, and currency exchange rates by the use of derivatives includ-
ing options and futures as well as options on futures. Such strategies are
commonly referred to as "derivatives" and involve the risk of imperfect corre-
lation in movements in the price of options and futures and movements in the
price of securities, interest rates or currencies which are the subject of the
hedge. To the extent these transactions involve foreign securities or curren-
cies, they are also subject to the risk factors associated with foreign in-
vestments generally. There can be no assurance that a liquid secondary market
for options and futures contracts will exist at any specific time; (2) The
Portfolio may invest up to 10% of its assets in securities rated lower than
Baa by Moody's Investors Service, Inc. ("Moody's") or BBB by Standard & Poor's
Ratings Services ("S&P"). These securities carry a high degree of credit risk,
and are considered speculative by the major credit rating agencies and are
sometimes referred to as "junk bonds" and "high risk/high yield" securities;
(3) The Portfolio may invest up to 10% of its assets in foreign issuers, which
may involve greater risks than investments in domestic securities, such as
foreign currency risk; (4) The Portfolio may invest in repurchase agreements
which entail a risk of loss should the seller default on its transaction.
(5) The Portfolio may lend its investment securities which entails a risk of
loss should a borrower fail financially; (6) The Portfolio may purchase secu-
rities on a when-issued basis which does not earn interest until issued and
may decline or appreciate in market value prior to their delivery to the Port-
folio. See "OTHER INVESTMENT POLICIES."
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the periods presented for the Portfolio. This table is
part of the Portfolio's Annual Financial Statements, which are included in the
Portfolio's 1998 Annual Report to Shareholders. The Report is incorporated by
reference into the Portfolio's SAI. The Portfolio's Annual Financial State-
ments have been audited by PricewaterhouseCoopers LLP whose unqualified opin-
ion thereon is also incorporated into the Portfolio's SAI. The following in-
formation should be read in conjunction with the Portfolio's 1998 Annual Re-
port to Shareholders. Further information about the Portfolio's performance is
contained in its Annual Report, which may be obtained without charge by tele-
phoning the number on the Prospectus cover page.
<TABLE>
<CAPTION>
JANUARY 24,
YEAR ENDED YEAR ENDED YEAR ENDED 1995*** TO
APRIL 30, APRIL 30, APRIL 30, APRIL 30,
1998 1997 1996 1995
---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD......................... $ 10.30 $ 10.39 $10.33 $10.00
------- ------- ------ ------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income.......... 0.57 0.61 0.64 0.17
Net Realized and Unrealized
Gain on Investments........... 0.24 (0.05) 0.14++ 0.26
------- ------- ------ ------
Total from Investment
Operations.................... 0.81 0.56 0.78 0.43
------- ------- ------ ------
DISTRIBUTIONS
Net Investment Income.......... (0.57) (0.62) (0.64) (0.10)
Net Realized Gain.............. -- (a) (0.03) (0.08) --
------- ------- ------ ------
Total Distributions............ (0.57) (0.65) (0.72) (0.10)
------- ------- ------ ------
NET ASSET VALUE, END OF PERIOD.. $ 10.54 $ 10.30 $10.39 $10.33
======= ======= ====== ======
TOTAL RETURN+................... 8.08% 5.53% 7.62% 4.31%**
======= ======= ====== ======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period
(Thousands).................... $13,261 $10,044 $7,981 $5,267
Ratio of Expenses to Average Net
Assets......................... 0.80% 0.80% 0.84% 0.80%*
Ratio of Net Investment Income
to Average Net Assets.......... 5.64% 5.88% 6.17% 6.20%*
Portfolio Turnover Rate......... 40% 31% 24% 0%
Ratio of Voluntary Waived Fees
and Expenses Assumed by the
Adviser to Average Net Assets.. 0.93% 1.39% 1.20% 2.78%*
Ratio of Expenses to Average Net
Assets Including Expense
Offsets........................ 0.80% 0.80% 0.80% 0.80%*
</TABLE>
- -----------
* Annualized.
** Not annualized.
*** Commencement of Operations.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the periods indicated.
++ The amount shown for a share outstanding throughout the year does not ac-
cord with the aggregate net losses on investments for that year because of
the timing of sales and repurchases of the Portfolio shares in relation to
fluctuating market value of the investments of the Portfolio.
(a) Amount is less than $0.01 per share.
5
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks a high level of current income consistent with moderate
interest rate exposure by investing primarily in investment grade bonds with
an average weighted maturity between 3 and 10 years. There can be no assurance
that the Portfolio will achieve its stated objective. The Adviser seeks to re-
duce the risk that is inherent in the fast-changing bond market while adding
to the return available from a bond market index.
INVESTMENT POLICIES
The Portfolio seeks to achieve its objective by investing at least 65% of
its total assets under normal circumstances in intermediate-term investment
grade notes or bonds with an average weighted maturity between 3 and 10 years.
Investment grade bonds are generally considered to be those bonds having one
of the four highest grades assigned by Moody's (Aaa, Aa, A or Baa) or S&P
("S&P") (AAA, AA, A or BBB), or, if unrated, of equivalent quality in the Ad-
viser's judgment. Bonds rated Baa or BBB have speculative characteristics and
may be more sensitive to changes in the economy and the financial condition of
issuers than higher rated bonds. The Portfolio may invest no more than 10% of
its assets in debt securities that at the time of purchase are rated lower
than investment grade. These are commonly referred to as "junk bonds". See the
discussion of high yield securities in "OTHER INVESTMENT POLICIES" below. The
Adviser also reserves the right to retain securities which are downgraded by
one or both of the rating agencies, if in the Adviser's judgment, the reten-
tion of securities is warranted. The Portfolio's SAI contains a more detailed
description of corporate bond ratings.
The Adviser will seek to achieve the Portfolio's objective by investing in
the following securities: corporate notes and bonds, mortgage-backed securi-
ties including collateralized mortgage obligations and asset-backed securities
which are deemed by the Adviser and the rating agencies cited above to be of
investment grade quality; variable rate and fixed rate debt securities which
at the time of purchase are rated as investment grade; short-term securities
deemed by the Adviser to have comparable ratings; and securities of, or guar-
anteed by, the U.S. government, its agencies or instrumentalities.
While the Adviser anticipates that the majority of the assets in the Portfo-
lio will be U.S. dollar denominated securities, it reserves the right to pur-
chase obligations of foreign governments, agencies, or corporations denomi-
nated either in U.S. dollars or foreign currencies. The credit quality stan-
dards applied to foreign obligations are the same as those applied to the se-
lection of U.S. based securities.
For temporary defensive purposes, the Portfolio may reduce its holdings of
fixed income securities and increase, up to 100%, its holdings in short-term
investments. The Adviser may employ a defensive investment posture during ad-
verse
6
<PAGE>
market conditions. See "SHORT-TERM INVESTMENTS" below for a description of the
types of short-term instruments in which the Portfolio may invest for tempo-
rary defensive purposes. When the Portfolio is in a temporary defensive posi-
tion, it may not necessarily be pursuing its stated investment objective.
The Portfolio is managed to control the risk of investing in the bond mar-
ket. The Adviser's investment approach offers some protection from fluctuation
in bond prices or volatility. Bond prices fluctuate dramatically due, most
visibly, to changes in interest rates. Other factors impact the value of bonds
held in the Portfolio, as well, including changes in:
. Investors' perception of the value of certain broad classes of
bonds, such as corporate, government or mortgage-backed securities
(sector positioning);
. The relationship between long-term and short-term interest rates
(the yield curve);
. The correlation between yields offered on different types of bonds
(spreads);
. The likelihood that bonds will be redeemed before maturity (option-
adjusted spreads); and
. The fact that the credit outlook for a specific security can change
over time.
Since so many different factors affect bond prices, it has been difficult,
historically, for bond fund managers to outperform a bond market index. The
Adviser believes this is particularly true of bond managers who try to predict
interest rate movements. It has observed that these managers often change in-
vestment strategy at the top or bottom of the market, adding to long-term bond
holdings when interest rates are low and shoring up short-term positions when
interest rates are high. This tendency naturally causes portfolio performance
to vary widely. Therefore, the Adviser does not depend on the use of interest
rate forecasting in managing the Portfolio.
At market tops and bottoms, market psychology tends to drive bond prices to
extremes, overshooting their long-term equilibrium levels. As a result, "con-
ventional wisdom" about a given security or sector's price movement or rela-
tive value, is often wrong. The Adviser believes it will be possible to add to
the Portfolio's return by taking a contrarian approach and also focusing its
efforts on the more traditional aspects of portfolio management. In particu-
lar, the Adviser scrutinizes sector valuations, coupons, call features and the
shape of the yield curve in making its investment decisions.
7
<PAGE>
OTHER INVESTMENT POLICIES
The Portfolio may also, under normal circumstances, invest up to 35% of its
assets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities, investments or investment tech-
niques.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. government ob-
ligations, U.S. government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's, or if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the Securities and Exchange Commission
(the "SEC") to deposit the daily uninvested cash balances of the Fund's Port-
folios, as well as cash for investment purposes, into one or more joint ac-
counts and to invest the daily balance of the joint accounts in the following
short-term investments: fully collateralized repurchase agreements, interest-
bearing or discounted commercial paper including dollar-denominated commercial
paper of foreign issuers, and any other short-term money market instruments
including variable rate demand notes and tax-exempt money instruments. By en-
tering into these investments on a joint basis the Portfolio may earn a higher
rate of return on investments relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
8
<PAGE>
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore
9
<PAGE>
delivery is due. Delayed settlement is a term used to describe settlement of a
securities transaction in the secondary market which will occur sometime in
the future. No payment or delivery is made by the Portfolio until it receives
delivery or payment from the other party to any of the above transactions. It
is possible that the market price of the securities at the time of delivery
may be higher or lower than the purchase price. The Portfolio will maintain a
separate account of cash or liquid securities at least equal to the value of
purchase commitments until payment is made. Typically, no income accrues on
securities purchased on a delayed delivery basis prior to the time delivery is
made although the Portfolio may earn income on securities it has deposited in
a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation. The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company,
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio, provided that the
investment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
10
<PAGE>
FOREIGN INVESTMENTS
Investing in foreign companies may involve additional risks and considera-
tions which are not typically associated with investing in U.S. companies.
Since stocks of foreign companies are normally denominated in foreign curren-
cies, the Portfolio may be affected favorably or unfavorably by changes in
currency rates and in exchange control regulations, and may incur costs in
connection with conversions between various currencies.
As non-U.S. companies are not generally subject to uniform accounting, au-
diting and financial reporting standards and practices comparable to those ap-
plicable to U.S. companies, comparable information may not be readily avail-
able about certain foreign companies. Securities of some non-U.S. companies
may be less liquid and more volatile than securities of comparable U.S. compa-
nies. In addition, in certain foreign countries, there is the possibility of
expropriation or confiscatory taxation, political or social instability, or
diplomatic developments which could affect U.S. investments in those coun-
tries.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may also invest up to 15% of
its net assets in securities that are illiquid. Prices realized from the sales
of these securities could be more or less than those originally paid by the
Portfolio or less than what may be considered the fair value of such securi-
ties.
MORTGAGE-BACKED SECURITIES
The Portfolio may invest in mortgage-backed securities. Mortgage-backed se-
curities are collateralized by pools of mortgages assembled for subsequent
sale to investors by various governmental agencies and sponsored organizations
as well as by private issuers. The underlying assets collateralizing the mort-
gage-backed securities may include single-family, multi-family and commercial
properties. The two fundamental forms of mortgage-backed securities are pass-
throughs and collateralized mortgage obligations ("CMOs"). Pass-throughs pro-
duce monthly payments of principal and interest from the underlying mortgages.
CMOs divide the cash flows generated from the underlying mortgages or mortgage
pass-through securities into different segments known as "tranches," which are
then retired sequentially over time in order of priority. The market value and
yield of mortgage-backed securities will fluctuate due to market interest rate
change and prepayment variability of the underlying mortgages. As prepayment
rates on mortgages vary widely, it
11
<PAGE>
is difficult to accurately predict the average maturity of a particular pool
of mortgages or tranches of CMOs. Although mortgage-backed securities may of-
fer higher yields than those available from other types of securities, they
may be less effective than other types of securities as a means of "locking
in" an attractive rate for an extended period because of the prepayment fea-
ture. Prepayment risk has two important effects. First, like bonds in general,
mortgage-backed securities will generally decline in price when interest rates
rise. Second, when interest rates fall and additional mortgage prepayments
must be reinvested at lower interest rates, a Portfolio's rate of dividend in-
come may be reduced. Mortgage-backed securities in which the Portfolio may in-
vest will either carry a guarantee from an agency of the U.S. Government or a
private issuer of the timely payment of principal and interest or will be
suitably structured to be considered by the Adviser to be of investment grade
quality.
ASSET-BACKED SECURITIES
The Portfolio may invest in asset-backed securities. Asset-backed securities
are collateralized by short maturity loans such as automobile receivables,
credit card receivables, or other types of receivables or assets, the payments
from which are passed through to the security holder. Credit support for as-
set-backed securities may be based on the underlying assets and/or provided
through credit enhancements by a third party. Credit enhancement techniques
include letters of credit, insurance bonds, limited guarantees, (which are
generally provided by the issuer), senior-subordinated structures and over-
collateralization. The value of these securities may be significantly affected
by changes in interest rates, the market's perceptions of the issuers and the
creditworthiness of the parties involved.
HIGH YIELD/HIGH RISK SECURITIES
The Portfolio may invest up to 10% of its assets in high yield securities
which are rated below investment grade or are unrated. Lower rated or unrated
securities are more likely to react to developments affecting market and
credit risk than are more highly rated securities, which react primarily to
movements in the general level of interest rates. The market values of fixed-
income securities tend to vary inversely with the level of interest rates.
Yields and market values of high yield securities will fluctuate over time,
reflecting not only changing interest rates, but also the market's perception
of credit quality and the outlook for economic growth. When economic condi-
tions appear to be deteriorating, medium to lower rated securities may decline
in value due to heightened concern over credit quality, regardless of prevail-
ing interest rates. The Adviser will consider both credit risk and market risk
in selecting fixed income securities for the Portfolio.
The high yield securities market is still relatively new and its recent
growth paralleled a long period of economic expansion and an increase in merg-
er, acquisition and leveraged buyout activity. Adverse economic developments
may disrupt
12
<PAGE>
the market for high yield securities, and severely affect the ability of is-
suers, especially highly leveraged issuers, to service their debt obligations
or to repay their obligations upon maturity. In addition, the secondary market
for high yield securities, which is concentrated in relatively few market mak-
ers, may not be as liquid as the secondary market for more highly rated secu-
rities. As a result, the Adviser could find it more difficult to sell these
securities or may be able to sell the securities only at prices lower than if
such securities were widely traded. Prices realized upon the sale of such
lower rated or unrated securities, under these circumstances, may be less than
the prices used in calculating the Portfolio's net asset value.
Prices for high yield securities may be affected by legislative and regula-
tory developments. These laws could adversely affect the Portfolio's net asset
value and investment practices, the secondary market for high yield securi-
ties, the financial condition of issuers of these securities and the value of
outstanding high yield securities. For example, federal legislation requiring
the divestiture by federally insured savings and loan associations of their
investments in high yield bonds and limiting the deductibility of interest by
certain corporate issuers of high yield bonds adversely affected the market in
recent years.
Lower rated or unrated debt obligations also present risks based on payment
expectations. If an issuer calls the obligations for redemption, the Fund may
have to replace the security with a lower yielding security, resulting in a
decreased return for investors. If the Portfolio experiences unexpected net
redemptions, it may be forced to sell its higher rated securities, resulting
in a decline in the overall credit quality of the Portfolio's investment port-
folio and increasing the exposure of the Portfolio to the risks of high yield
securities.
HEDGING AND RELATED STRATEGIES AND RISK CONSIDERATIONS
The Portfolio may use options (both exchange-traded and over-the-counter) to
attempt to enhance income. To reduce the overall risk of its investments
(hedge), the Portfolio may use options, futures contracts, options on futures
contracts, and forward currency contracts. These instruments are commonly re-
ferred to as derivatives. Hedging strategies may also be used in an attempt to
manage the Portfolio's exposure to changing interest rates, security prices
and currency exchange rates. The Portfolio may buy or sell futures contracts,
write covered call options and buy put and call options on any security, index
or currency including options and futures traded on foreign exchanges and op-
tions not traded on exchanges. The Portfolio's ability to use these strategies
may be limited by market conditions, regulatory limits and tax considerations.
The Portfolio's obligation under such hedging strategies will be covered by
the maintenance of a segregated account consisting of cash or liquid securi-
ties equal to at least 100% of the Portfolio's commitment. The SAI contains
further information on all of these strategies and the risks associated with
them.
13
<PAGE>
The Portfolio may write or purchase options in privately negotiated transac-
tions ("OTC Options") as well as listed options. OTC Options can be closed out
only by agreement with the other party to the transaction. Any OTC Option pur-
chased by the Portfolio is considered an illiquid security. Any OTC Option
written by the Portfolio will be with a qualified dealer pursuant to an agree-
ment under which the Portfolio may repurchase the option at a formula price.
Such options are considered illiquid to the extent that the formula price ex-
ceeds the intrinsic value of the option. The Portfolio may not purchase or
sell futures contracts or related options for which the aggregate initial mar-
gin and premiums exceed 5% of the fair market value of the Portfolio's assets.
In order to prevent leverage in connection with the purchase of futures con-
tracts or call options thereon by the Portfolio, an amount of cash, cash
equivalents or liquid securities equal to the market value of the obligation
under the futures contracts or options (less any related market deposits) will
be maintained in a segregated account with the Fund's Custodian Bank. The
Portfolio may not invest more than 15% of its net assets in illiquid securi-
ties and repurchase agreements which have a maturity of longer than seven
days. A more complete discussion of the potential risks involved in transac-
tions in options or futures contracts and related options is contained in the
SAI.
The Portfolio may enter into forward currency contracts for the purchase or
sale of a specified currency at a specified future date either with respect to
specific transactions or with respect to portfolio positions. The Portfolio
also may enter into a forward contract to sell an amount of a foreign currency
approximating the value of some or all of the Portfolio's securities denomi-
nated in such currency.
The Portfolio may use forward contracts in one currency or a basket of cur-
rencies to hedge against fluctuations in the value of another currency when
the Adviser anticipates there will be a correlation between the two and may
use forward currency contracts to shift the Portfolio's exposure to foreign
currency fluctuations from one country to another. The purpose of entering
into these contracts is to minimize the risk to the Portfolio from adverse
changes in the relationship between the U.S. dollar and foreign currencies.
The Portfolio may enter into interest rate protection transactions, which
consist of interest rate swaps and interest rate caps, collars and floors, for
hedging purposes. These transactions are commonly referred to as derivatives.
A swap is an agreement to exchange the return generated by one instrument for
the return generated by another instrument. The swaps in which the Portfolio
may also engage include interest rate caps, floors and collars under which one
party pays a single or periodic fixed amount (or premium), and the other party
pays periodic amounts on movement of a specified index.
The Portfolio may enter into interest rate protection transactions to pre-
serve a return or spread on a particular investment or portion of its portfo-
lio or to protect against any increase in the price of securities it antici-
pates purchasing at a later
14
<PAGE>
date. The Portfolio will enter into interest rate protection transactions only
with banks and recognized securities dealers believed by the Adviser to pres-
ent minimal credit risks in accordance with guidelines established by the
Fund's Board of Trustees. Interest rate swaps, caps, floors and collars will
be treated as illiquid securities and will therefore, be subject to the Port-
folio's investment restriction limiting investment in illiquid securities to
no greater than 15% of its net assets.
RISK CONSIDERATIONS. The Portfolio might not employ any of the hedging
strategies described above, and there can be no assurance that any strategy
used will succeed. If the Adviser incorrectly forecasts interest rates, market
values or other economic factors in utilizing a hedging strategy for the Port-
folio, the Portfolio would be in a better position if it had not hedged at
all. In addition, the Portfolio will pay commissions and other costs in con-
nection with such hedging strategies, which may increase the Portfolio's ex-
penses and reduce its return.
The use of these strategies involves certain risks, including (1) the fact
that skills needed to use hedging instruments are different from those needed
to select the Portfolio's securities, (2) possible imperfect correlation, or
even no correlation, between price movements of hedging instruments and price
movements of the investments being hedged, (3) the fact that, while hedging
strategies can reduce the risk of loss, they can also reduce the opportunity
for gain, or even result in losses, by offsetting favorable price movements in
hedged investments and (4) the possible inability of the Portfolio to purchase
or sell a portfolio security at a time that otherwise would be favorable for
it to do so, or the possible need for the Portfolio to sell a portfolio secu-
rity at a disadvantageous time, due to the need for it to maintain "cover" or
to segregate securities in connection with hedging transactions and the possi-
ble inability of the Portfolio to close out or to liquidate its hedged posi-
tion.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
15
<PAGE>
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The investment objective of the Portfolio is fundamental and may be changed
only with the approval of the holders of a majority of the outstanding shares
of the Portfolio. Except for limitations (a), (b), (d), (e) and (f)(i), the
Portfolio's investment limitations and policies described in this Prospectus
and in the SAI are not fundamental and may be changed by the Fund's Board of
Trustees upon reasonable notice to investors. All other investment limitations
described here and in the SAI are fundamental policies and may be changed only
with the approval of the holders of a majority of the outstanding shares of
the Portfolio. If a percentage limitation on investment or utilization of as-
sets as set forth above is adhered to at the time an investment is made, a
later change in percentage resulting from changes in the value or total cost
of the Portfolio's assets will not be considered a violation of the restric-
tion.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value next deter-
mined after an order is received by the Fund and payment is received by the
Fund or its designated Service Agent (See "VALUATION OF SHARES.") The minimum
initial investment required is $2,000. The minimum initial investment for IRA
accounts is $500. The minimum initial investment for spousal IRA accounts is
$250. Certain exceptions may be permitted by the officers of the Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") that have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions or on purchase
and redemption of Portfolio shares and may charge transaction or other account
fees by their customers. Each Service Agent is responsible for transmitting to
its customers a
16
<PAGE>
schedule of any such fees and information regarding additional or different
purchase and redemption conditions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. Amounts paid to Service Agents may include transaction fees
and/or service fees paid by the Fund from the Fund assets attributable to the
Service Agent, and would not be imposed if shares of the Portfolio were pur-
chased directly from the Fund or the Distributor. The Service Agents may pro-
vide shareholder services to their customers that are not available to a
shareholder dealing directly with the Fund. A salesperson and any other person
entitled to receive compensation for selling or servicing Portfolio shares may
receive different compensation with respect to one particular class of shares
over another in the Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by a
Service Agent or its authorized designee. Service Agents are responsible to
their customers and the Fund for timely transmission of all subscription and
redemption requests, investment information, documentation and money.
INITIAL INVESTMENT
BY MAIL
.Complete and sign an Application, and mail it together with a check
payable to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds."
17
<PAGE>
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that days price. An account number and a wire control number will then
be provided to you in addition to wiring instructions. Next,
. instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name
Your Account Number
Your Account Name
Wire Control Number (assigned by the UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, please notify the UAM Funds Service Center by calling the number on
the cover of this prospectus. Mail orders should include, when possible, the
"Invest by Mail" stub which accompanies any Fund confirmation statement.
18
<PAGE>
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of each Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolios are intended to be long-term investment vehicles and are
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lio's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
19
<PAGE>
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone, at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of your shares depending
on the market value of the investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
20
<PAGE>
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by
a written request signed by each shareholder, with each signature
guaranteed);
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareholder(s)
. redemptions where the proceeds are to be sent to an address which
is not the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, as well as through most brokers, dealers, credit
unions, national securities exchanges, registered securities associations,
clearing agencies and savings associations. Broker-dealers guaranteeing signa-
tures must be a member of a
21
<PAGE>
clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances as determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of the remaining shareholders of the Fund to make payments
wholly or partly in cash, the Fund may pay the redemption proceeds in whole or
in part by a distribution in-kind of liquid securities held by the Portfolio
in lieu of cash in conformity with applicable rules of the SEC. Investors may
incur brokerage charges when they sell portfolio securities received in pay-
ment of redemptions.
The Portfolios reserve the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of each Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
22
<PAGE>
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4 p.m. Eastern Time) will be
processed as of the close of business on the same day. Requests received after
the close of regular trading on the NYSE will be processed on the next busi-
ness day. The Fund may modify or terminate the exchange program at any time
upon 60 days' written notice to shareholders, and may reject any exchange re-
quest. If the Fund's management determines that an investor is engaged in ex-
cessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility for the authentic-
ity of telephoned instructions, see "REDEMPTION OF SHARES -- BY TELEPHONE." An
exchange into another UAM Funds Portfolio is a sale of shares and may result
in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or by pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Services Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business
23
<PAGE>
days following receipt. The Fund may modify or terminate this privilege at any
time, or may charge a service fee, although no such fee currently is contem-
plated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A Shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any time by the Fund. A share-
holder may elect at any time, in writing, to terminate participation in the
Systematic Withdrawal Plan. Such written election must be sent to and received
by the Fund before a determination becomes effective. There is currently no
charge to the shareholder for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of a Portfolio is determined by dividing the value of
the Portfolio's assets, less any liabilities, by the number of shares out-
standing. The net asset value per share of the Portfolio is determined as of
the close of the NYSE on each day that the NYSE is open for business.
Bonds and other fixed income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities. Securities purchased with remaining
maturities of 60 days or less are valued at amortized cost when the Board of
Trustees determines that amortized cost reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
24
<PAGE>
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the address or phone number on the cover
of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, the Portfolio will normally distribute such
gains annually. All dividends and capital gains distributions will be automat-
ically reinvested in additional shares of the Portfolio unless the Fund is no-
tified in writing that the shareholder elects to receive distributions in
cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
25
<PAGE>
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by each Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
Chicago Asset Management Company (the "Adviser") is a registered investment
adviser formed in 1983. Its business offices are located at 70 West Madison
Street, 56th Floor, Chicago, IL 60602. The Adviser is a wholly-owned subsidi-
ary of United Asset Management Corporation ("UAM"), a holding company, and
provides and offers investment management and advisory services to corpora-
tions, unions, pensions and profit-sharing plans, trusts, estates and other
institutions and investors. As of December 31, 1997, the Adviser had over $2
billion in assets under management.
The Portfolio pays an annual fee in monthly installments to the adviser for
advisory services. This fee is accrued daily and paid monthly as a percentage
of the average daily net assets in the Portfolio for that month. The percent-
age fee on an annual basis is 0.48%. The Adviser has agreed to waive a portion
of its advisory fees and to assume certain operating expenses in order to keep
the Portfolio's total operating expenses from exceeding 0.80% of average daily
net assets.
26
<PAGE>
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at its own expense, compensate a Service Agent or other person for
marketing, shareholder servicing, record-keeping and/or other services per-
formed with respect to the Fund, a Portfolio or any Class of Shares of a Port-
folio. Payments for such services may be made from the paying entity's reve-
nues, its profits or any other source available to it. When such service ar-
rangements are in effect, they are made generally available to all qualified
service providers.
The Distributor, the Adviser, and certain of their affiliates also partici-
pate, at the date of this prospectus, in an arrangement with Smith Barney,
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and shareholder services of its Consulting Group and receives .15% of
1% of the daily net asset value of Institutional Class Shares held by Smith
Barney's eligible customer accounts in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vided to certain defined contribution plan shareholders that are not otherwise
provided by UAMFSI.
The investment professionals at the Adviser responsible for the day-to-day
management of the Portfolio and their qualifications are as follows:
<TABLE>
<C> <S>
Jon F. Holsteen, President, CEO and Chief Investment Officer
Education: Lake Forest College, BA
Experience: Founded Chicago Asset Management Company in 1983.
William W. Zimmer, Executive Vice President and Chief Fixed Income
Portfolio Manager
Education: Cornell College (Iowa), BA
Cornell University (New York), MBA
Experience: Joined Chicago Asset Management Company in 1988.
Gary R. Dhein, CFA, Vice President and Senior Portfolio Manager
Education: Loyola University, BA
University of Chicago, MBA
Experience: Bank of America (1978 to 1997)
Joined Chicago Asset Management Company in 1997.
Frank F. Holsteen, Vice President
Education: Lake Forest College, BA
Experience: Joined Chicago Asset Management Company in 1993.
</TABLE>
27
<PAGE>
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to the
composite of separately managed accounts of the Adviser that are managed with
substantially similar (although not necessarily identical) objectives, poli-
cies and strategies as those of the Portfolio. The performance data for the
managed accounts is net of all fees and expenses The investment returns of the
Portfolio may differ from those of the separately managed accounts because
such separately managed accounts may have fees and expenses that differ from
those of the Portfolio. Further, the separately managed accounts are not sub-
ject to investment limitations, diversification requirements and other re-
strictions imposed by the Investment Company Act of 1940 and Internal Revenue
Code; such conditions, if applicable, may have lowered the returns for sepa-
rately managed accounts. The results presented are not intended to predict or
suggest the return to be experienced by the Portfolio or the return an in-
vestor might achieve by investing in the Portfolio.
CHICAGO ASSET MANAGEMENT COMPANY--
INTERMEDIATE BOND + CASH COMPOSITE RETURNS
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
<TABLE>
<CAPTION>
CHICAGO LEHMAN BROTHERS
ASSET INTERMEDIATE
MANAGEMENT GOVERNMENT/CORPORATE
CALENDAR YEARS COMPANY INDEX
-------------- ---------- --------------------
<S> <C> <C>
1985......................................... 22.0% 18.1%
1986......................................... 15.2% 13.1%
1987......................................... 0.7% 3.7%
1988......................................... 7.0% 6.7%
1989......................................... 13.0% 12.8%
1990......................................... 8.8% 9.2%
1991......................................... 17.1% 14.7%
1992......................................... 8.6% 7.2%
1993......................................... 10.2% 8.8%
1994......................................... (2.4)% (1.9)%
1995......................................... 15.8% 15.3%
1996......................................... 3.9% 4.1%
1997......................................... 7.7% 7.9%
3 months ended 3/31/98....................... 1.5% 1.6%
Annualized through 3/31/98................... 9.6% 9.0%
Cumulative through 3/31/98................... 234.9% 214.4%
Thirteen-Year Mean........................... 9.8% 9.2%
Value of $1 invested
(1/1/85-3/31/98)........................... $3.35 $3.14
</TABLE>
28
<PAGE>
CHICAGO ASSET MANAGEMENT COMPANY--
INTERMEDIATE BOND + CASH RETURNS FOR VARIOUS PERIODS ENDED 3/31/98
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
(UNAUDITED)
<TABLE>
<CAPTION>
LEHMAN BROTHERS
INTERMEDIATE
GOVERNMENT/CORPORATE
PERIODS ENDED 3/31/98 ADVISER INDEX
- --------------------- ------- --------------------
<S> <C> <C>
One-year period.................................... 9.5% 9.7%
Three-year period (average annual)................. 7.9% 8.0%
Five-year period (average annual).................. 6.3% 6.2%
Ten-year period (average annual)................... 8.6% 8.2%
</TABLE>
- -----------
Notes:
1. The annualized return is calculated from monthly data, allowing for com-
pounding. Market Value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The cumulative return means that $1 invested in the composite account on
January 1, 1985 had grown to $3.35 by March 31, 1998.
3. The thirteen-year mean is the arithmetic average of the annual returns for
the years listed.
4. The Lehman Brothers Intermediate Government/Corporate Index is an unman-
aged index which assumes reinvestment of dividends and is generally con-
sidered representative of securities similar to those invested in by the
Adviser for the purpose of the composite performance numbers set forth
above.
5. The Adviser's average annual management fee over the period shown was
0.30% or 30 basis points. During the period, fees on the Adviser's indi-
vidual accounts ranged from 0.26% to 0.625% (26 basis points to 62.5 basis
points). Net returns to investors vary depending on the management fee.
6. The intermediate fixed income + cash composite includes every separate
discretionary intermediate fixed income account as of 3/31/98. No accounts
were excluded. As of 3/31/98, this composite included all 11 intermediate
fixed income portfolios, including the intermediate fixed income + cash
portions of balanced accounts, totaling $269 million. Leverage has not
been used in any portfolios included in this composite. A list of all com-
posites of the firm is available upon request.
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministrative, fund accounting, dividend disbursing and transfer agent services
provided to the Fund and its Portfolios. UAMFSI's principal office is located
at 211 Congress Street, Boston, MA 02110. UAMFSI has subcontracted some of
these
29
<PAGE>
services to Chase Global Funds Services Company ("CGFSC"), an affiliate of The
Chase Manhattan Bank, by a Mutual Funds Service Agreement dated June 30, 1997.
CGFSC is located at 73 Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
RATE
----
Chicago Asset Management Intermediate Bond Portfolio............... 0.04%
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but
less than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or other compensation under the Agreement with respect to this
Portfolio. The Agreement continues in effect as long as such continuance is
approved at least annually by the Fund's Board of Trustees. Those approving
the Agreement must include a majority of the Trustees who are neither parties
to the Agreement nor interested persons of any such party. The Agreement pro-
vides that the Fund will bear the costs of the registration of its shares with
the SEC and various states and the printing of its prospectuses, its SAIs and
its reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available
30
<PAGE>
price and most favorable execution for all transactions of the Portfolio. If
consistent with the interests of the Portfolio, the Adviser may select brokers
on the basis of the research, statistical and pricing services they provide to
the Portfolio in addition to required services. Such brokers may be paid a
higher commission than that which another qualified broker would have charged
for effecting the same transaction, provided that such commissions are paid in
compliance with the Securities Exchange Act of 1934, as amended, and that the
Adviser determines in good faith that such commission is reasonable in terms
either of the transaction or the overall responsibility of the Adviser to the
Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same time, transactions in such securities will
be allocated among the Portfolio and clients in a manner deemed fair and rea-
sonable by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, John D. Curran and Francis McMartin, Trustees, FBO
Pipefitters Pension Fund Local 597, held of record 89.4% of the outstanding
shares of the CAM Intermediate Bond Portfolio Institutional Class for which
beneficial ownership is disclaimed or presumed disclaimed. The persons or or-
ganizations owning 25% or more of the outstanding shares of a Portfolio may be
presumed to
31
<PAGE>
"control" (as that term is defined in the 1940 Act) such Portfolio. As a re-
sult, those persons or organizations could have the ability to vote a majority
of the shares of the Portfolio on any matter requiring the approval of share-
holders of such Portfolio.
Both Institutional and Service Class Shares represent an interest in the
same assets of a Portfolio. Service Class Shares bear certain expenses related
to shareholder servicing and the distribution of such shares and have exclu-
sive voting rights with respect to matters relating to distribution expendi-
tures. The Board of Trustees of the Fund has authorized a third class of
shares, Advisor Class Shares, which is not currently being offered by this
Portfolio.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters to the extent required by
the undertaking.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover page of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
32
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
Cambiar Opportunity Portfolio
BHM&S Total Return Bond Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
33
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Chicago Asset Management Company
70 West Madison Street 56th Floor
Chicago, IL 60602
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
Chicago Asset Management
Value/Contrarian Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses............................................................ 1
Prospectus Summary....................................................... 3
Risk Factors............................................................. 4
Financial Highlights..................................................... 5
Investment Objective..................................................... 6
Investment Policies...................................................... 6
Other Investment Policies................................................ 8
Investment Limitations................................................... 14
Purchase of Shares....................................................... 15
Redemption of Shares..................................................... 19
Shareholder Services..................................................... 21
Valuation of Shares...................................................... 23
Performance Calculations................................................. 23
Dividends, Capital Gains Distributions and Taxes......................... 24
Investment Adviser....................................................... 25
Adviser's Historical Performance......................................... 26
Administrative Services.................................................. 28
Distributor.............................................................. 28
Portfolio Transactions................................................... 29
General Information...................................................... 29
UAM Funds -- Institutional Class Shares.................................. 32
</TABLE>
<PAGE>
UAM FUNDS
CHICAGO ASSET MANAGEMENT
VALUE/CONTRARIAN PORTFOLIO
INSTITUTIONAL CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is, an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. The Chicago As-
set Management Value/Contrarian Portfolio currently offers only one class of
shares. The securities offered in this Prospectus are Institutional Class
Shares of one diversified, no-load Portfolio of the Fund managed by Chicago As-
set Management Company.
CHICAGO ASSET MANAGEMENT VALUE/CONTRARIAN PORTFOLIO. Chicago Asset Management
Value/Contrarian Portfolio (the "Portfolio") seeks capital appreciation by in-
vesting primarily in the common stock of large companies. The common stocks in
which the Portfolio invests are generally ones which have performed poorly over
the recent past but which may have the potential for better-than-average per-
formance in the future.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction expenses. However, transaction fees may be charged if a broker-
dealer or other financial intermediary deals with the Fund on your behalf.
(See "PURCHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees (After Fee Waiver)......................... 0.000%
12b-1 Fees.......................................................... NONE
Other Expenses (After Expenses Assumed or Waived)................... 0.950%
-----
Total Operating Expenses (After Fee Waiver and Expenses Assumed).... 0.950 %*
=====
</TABLE>
- -----------
* Absent the fees waived and expenses assumed, Investment Advisory Fees, Other
Expenses and Total Operating Expenses for the Portfolio would have been
0.625%, 0.965% and 1.590%, respectively. The Total Operating Expenses in-
cludes the effect of expense offsets. If expense offsets were excluded, To-
tal Operating Expenses of the Portfolio would not be affected. Until further
notice, the Adviser and certain other service providers have voluntarily
agreed to waive their fees and/or to assume certain operating expenses to
keep the Portfolio's total annual operating expenses (excluding interest,
taxes and extraordinary expenses), after the effect of expense offsets, from
exceeding 0.950% of average daily net assets. The Advisor and certain other
service providers may change or discontinue their fee waivers and expense
assumptions at any time.
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's operations during the fiscal year ended April 30, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Chicago Asset Management
Value/Contrarian
Portfolio Institutional Class Shares.... $ 10 $ 30 $ 53 $ 117
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Chicago Asset Management Company (the "Adviser") is a registered investment
adviser founded in 1983 specializing in the active management of stocks, bonds
and balanced portfolios for institutional, tax-exempt clients. As of December
3, 1997, the Adviser had over $2 billion in assets under management. (See "IN-
VESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,000. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in Portfolio
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Prospective investors
should consider the following: (1) The Portfolio may engage in various strate-
gies to seek to hedge its investments against movements in security prices,
interest rates and currency exchange rates by the use of derivatives including
options and futures as well as options on futures. Such strategies are com-
monly referred to as "derivatives" and involve the risk of imperfect correla-
tion in movements in the price of options and futures and movements in the
price of securities, interest rates or currencies which are the subject of the
hedge. To the extent these transactions involve foreign securities or curren-
cies, they are also subject to the risk factors associated with foreign in-
vestments generally. There can be no assurance that a liquid secondary market
for options and futures contracts will exist at any specific time; (2) The
Portfolio may invest up to 10% of its assets in foreign issuers, which may in-
volve greater risks than investments in domestic securities, such as foreign
currency risk; (3) The Portfolio may invest in repurchase agreements which en-
tail a risk of loss should the seller default on its transaction; (4) The
Portfolio may lend its investment securities which entails a risk of loss
should a borrower fail financially; (5) The Portfolio may purchase securities
on a when-issued basis which do not earn interest until issued and may decline
or appreciate in market value prior to their delivery to the Portfolio. (See
"OTHER INVESTMENT POLICIES.")
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the periods presented for the Portfolio. This table is
part of the Portfolio's Annual Financial Statements, which are included in the
Portfolio's 1998 Annual Report to Shareholders. The Report is incorporated by
reference into the Portfolio's SAI. The Portfolio's Annual Financial State-
ments have been audited by PricewaterhouseCoopers LLP whose unqualified opin-
ion thereon is also incorporated into the Portfolio's SAI. The following in-
formation should be read in conjunction with the Portfolio's 1998 Annual Re-
port to Shareholders. Further information about the Portfolio's performance is
contained in its Annual Report, which may be obtained without charge by call-
ing the telephone number on the Prospectus cover page.
<TABLE>
<CAPTION>
DECEMBER 16,
YEAR ENDED YEAR ENDED YEAR ENDED 1994*** TO
APRIL 30, 1998 APRIL 30, 1997 APRIL 30, 1996 APRIL 30, 1995
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD... $ 13.07 $ 13.67 $ 11.14 $ 10.00
------- ------- -------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income.. 0.17 0.18 0.19 0.05
Net Realized and
Unrealized Gain on
Investments.......... 3.84 0.30 2.86 1.13
------- ------- -------- -------
Total from Investment
Operations.......... 4.01 0.48 3.05 1.18
------- ------- -------- -------
DISTRIBUTIONS
Net Investment Income.. (0.18) (0.24) (0.23) (0.04)
Net Realized Gain...... (0.94) (0.84) (0.29) --
------- ------- -------- -------
Total Distributions... (1.12) (1.08) (0.52) (0.04)
------- ------- -------- -------
NET ASSET VALUE, END OF
PERIOD................ $ 15.96 $ 13.07 $ 13.67 $ 11.14
======= ======= ======== =======
TOTAL RETURN+........... 31.71% 3.72% 28.00% 11.81%**
======= ======= ======== =======
RATIOS AND SUPPLEMENTAL
DATA
Net Assets, End of
Period (Thousands).... $22,552 $13,804 $ 892 $ 696
Ratio of Expenses to
Average Net Assets.... 0.95% 0.95% 1.06% 0.95%*
Ratio of Net Investment
Income to Average Net
Assets................ 1.16% 1.89% 1.51% 1.54%*
Portfolio Turnover
Rate.................. 55% 21% 33% 4%
Average Commission
Rate#................. $0.0552 $0.0574 $ 0.0600 N/A
Ratio of Voluntarily
Waived Fees and
Expenses Assumed by
the Adviser to Average
Net Assets............ 0.64% 6.32% 12.20% 17.05%*
Ratio of Expenses to
Average Net Assets
Including Expense
Offsets............... 0.95% 0.95% 0.95% 0.95%*
</TABLE>
- -----------
* Annualized.
** Not annualized.
*** Commencement of Operations
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the periods indicated.
# Beginning with fiscal year 1996, the Portfolio is required to disclose the
average commission rate per share it paid for portfolio trades, on which
commissions were charged, during the period.
5
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks capital appreciation by investing primarily in the com-
mon stock of large companies. The common stocks in which the Portfolio invests
are generally ones which have performed poorly over the recent past but which
may have the potential for better than average performance in the future.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
INVESTMENT POLICIES
The Adviser focuses mainly on choosing individual stocks rather than trying
to forecast the overall strength of the stock market. In particular, the Ad-
viser seeks to invest in large, established quality companies whose stocks can
be bought at attractive prices because of the market's misperceptions about
the companies' value.
As a contrarian, the Adviser seeks to invest by going against the consensus
opinion on individual stocks. To discover the appropriate contrarian position,
the Adviser stays in contact with stock market research analysts and takes
their assumptions into account in determining whether stocks are undervalued
or overvalued.
The Portfolio will invest primarily in the common stock of large capitaliza-
tion companies which are defined as those with equity capitalizations greater
than $1 billion at the time of purchase. The Portfolio may also invest in se-
curities convertible into common stock. There is no particular percentage of
the Portfolio's assets to be invested in any one type of security, and it has
the ability to purchase other securities that may produce capital appreciation
such as non-convertible preferred stocks, rights and warrants to purchase com-
mon stocks, and bonds. However, under normal circumstances, the Adviser antic-
ipates no more than 5% of the Portfolio's total assets will be invested in in-
vestment grade bonds which are generally considered to be those bonds having
one of the four highest grades assigned by Moody's Investors Service
("Moody's") (Aaa, Aa, A or Baa) or Standard & Poor's Ratings Services ("S&P")
(AAA, AA, A or BBB), or if unrated, of equivalent quality in the Adviser's
judgment. The Adviser also reserves the right to retain securities which are
downgraded by one or both of the rating agencies, if in the Adviser's judg-
ment, the retention of securities is warranted. The Portfolio's SAI contains a
detailed description of corporate bond ratings.
The Portfolio seeks to outperform the market during most time periods, not
by taking advantages of shifts in the overall direction of the market, but by
identifying attractive stocks. The Portfolio will invest primarily in estab-
lished, high-quality companies whose stock is selling at attractive prices due
to short-term market misperceptions. Consistent with avoiding market timing is
maintaining most individual common stock holdings in a somewhat equally
weighted position in the
6
<PAGE>
Portfolio. This is sometimes accomplished by rebalancing current holdings in
response to a change in the market value of individual holdings over time. A
portion of a holding which has become larger due to market value change may be
sold. Conversely an additional purchase of shares of a current holding may be
made if market value change has reduced the holding size in the total portfo-
lio.
The Adviser's investment style is categorized as large cap, bottom-up, val-
ue-oriented and contrarian. Its investment philosophy and process is qualita-
tive rather than quantitative, and its investment approach has four distin-
guishing characteristics. First, it emphasizes large company stocks. Second,
it employs a bottom-up approach which means that it will construct the Portfo-
lio by focusing on individual stocks rather than industry groups or sectors.
(Top-down investors would first decide which industries or sectors they wanted
to emphasize and then would look for stocks that fit those requirements.)
Third, it is value-oriented. This means that it invests in stocks which are
perceived to be priced below their true value because the market does not rec-
ognize their potential. And fourth, it is contrarian in that it goes against
the common consensus when it invests. To maintain an effective contrarian pos-
ture, it closely monitors market opinion-makers, such as research analysts and
commentators, and then evaluates the impact of their opinions on stock prices,
in identifying securities which are perceived to be undervalued or overvalued.
This results in active contrarian rebalancing of current holdings.
The Adviser selects individual issues which offer a combination of some of
the following characteristics:
. they are out-of-favor among market analysts;
. they are priced below the mid-point of their trading range over the
past year;
. the issuing companies have maintained sound financial credit qual-
ity as measured by their balance sheets or they are expected to
significantly improve;
. they are large companies with market values over $1 billion;
. they have reasonable (based on normalized expected earnings) price-
to-earnings ratios; and
. they pay or may become able to pay a dividend.
When the Adviser believes that market conditions warrant a defensive posi-
tion, up to 100% of the Portfolio's assets may be held in cash and short-term
investments. See "SHORT-TERM INVESTMENTS AND REPURCHASE AGREEMENTS" below for
a description of the types of short-term instruments in which the Portfolio
may invest for temporary defensive purposes. When the Portfolio is in a defen-
sive position, it may not necessarily be pursuing its stated investment objec-
tive.
7
<PAGE>
OTHER INVESTMENT POLICIES
The Portfolio may also, under normal circumstances, invest up to 35% of its
assets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities, investments or investment tech-
niques.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. government ob-
ligations, U.S. government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's or, if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the Securities and Exchange Commission
(the "SEC") to deposit the daily uninvested cash balances of the Fund's Port-
folios, as well as cash for investment purposes, into one or more joint ac-
counts and to invest the daily balance of the joint accounts in the following
short-term investments: fully collateralized repurchase agreements, interest-
bearing or discounted commercial paper including dollar-denominated commercial
paper of foreign issuers, and any other short-term money market instruments
including variable rate demand notes and tax-exempt money instruments. By en-
tering into these investments on a joint basis, the Portfolio may earn a
higher rate of return on investments relative to what it could earn individu-
ally.
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the Fund's DSI Money Market Portfolio. (See "INVESTMENT
COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
8
<PAGE>
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on a loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore
9
<PAGE>
delivery is due. Delayed settlement is a term used to describe settlement of a
securities transaction in the secondary market which will occur sometime in
the future. No payment or delivery is made by the Portfolio until it receives
delivery or payment from the other party to any of the above transactions. It
is possible that the market price of the securities at the time of delivery
may be higher or lower than the purchase price. The Portfolio will maintain a
separate account of cash or liquid securities at least equal to the value of
purchase commitments until payment is made. Typically, no income accrues on
securities purchased on a delayed delivery basis prior to the time delivery is
made although the Portfolio may earn income on securities it has deposited in
a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation.) The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company,
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest the greater of 5% of its total assets or $2.5 million in the
DSI Money Market Portfolio for cash management purposes provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
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FOREIGN INVESTMENTS
Investing in foreign companies may involve additional risks and considera-
tions which are not typically associated with investing in U.S. companies.
Since stocks of foreign companies are normally denominated in foreign curren-
cies, the Portfolio may be affected favorably or unfavorably by changes in
currency rates and in exchange control regulations, and may incur costs in
connection with conversions between various currencies.
As non-U.S. companies are not generally subject to uniform accounting, au-
diting and financial reporting standards and practices comparable to those ap-
plicable to U.S. companies, comparable information may not be readily avail-
able about certain foreign companies. Securities of some non-U.S. companies
may be less liquid and more volatile than securities of comparable U.S. compa-
nies. In addition,
in certain foreign countries, there is the possibility of expropriation or
confiscatory taxation, political or social instability, or diplomatic develop-
ments which could affect U.S. investments in those countries.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may also invest up to 15% of
its net assets in securities that are illiquid. Prices realized from the sales
of these securities could be more or less than those originally paid by the
Portfolio or less than what may be considered the fair value of such securi-
ties.
HEDGING AND RELATED STRATEGIES AND RISK CONSIDERATIONS
To reduce the overall risk of its investments (hedge), the Portfolio may use
options, futures contracts, options on futures contracts, and forward currency
contracts. These instruments are commonly referred to as derivatives. Hedging
strategies may also be used in an attempt to manage the Portfolio's exposure
to changing interest rates, security prices and currency exchange rates. The
Portfolio's ability to use these strategies may be limited by market condi-
tions, regulatory limits and tax considerations. The Portfolio's obligation
under such hedging strategies will be covered by the maintenance of a segre-
gated account consisting of cash or liquid securities equal to at least 100%
of the Portfolio's commitment. The Portfolio may buy or sell futures con-
tracts, write covered call options and buy put and call options on any securi-
ty, index or currency including options and futures traded on foreign
11
<PAGE>
exchanges and options not traded on exchanges. The Portfolio's SAI contains
further information on all of these strategies and the risks associated with
them.
The Portfolio may write or purchase options in privately negotiated transac-
tions ("OTC Options") as well as listed options. OTC Options can be closed out
only by agreement with the other party to the transaction. Any OTC Option pur-
chased by the Portfolio is considered an illiquid security. Any OTC Option
written by the Portfolio will be with a qualified dealer pursuant to an agree-
ment under which the Portfolio may repurchase the option at a formula price.
Such options are considered illiquid to the extent that the formula price ex-
ceeds the intrinsic value of the option. The Portfolio may not purchase or
sell futures contracts or related options for which the aggregate initial mar-
gin and premiums exceed 5% of the fair market value of the Portfolio's assets.
In order to prevent leverage in connection with the purchase of futures con-
tracts or call options thereon by the Portfolio, an amount of cash, cash
equivalents or liquid securities equal to the market value of the obligation
under the futures contracts or options (less any related market deposits) will
be maintained in a segregated account with the Fund's Custodian Bank. The
Portfolio may not invest more than 15% of its net assets in illiquid securi-
ties and repurchase agreements which have a maturity of longer than seven
days. A more complete discussion of the potential risks involved in transac-
tions in options or futures contracts and related options is contained in the
Portfolio's SAI.
The Portfolio may enter into forward currency contracts for the purchase or
sale of a specified currency at a specified future date either with respect to
specific transactions or with respect to portfolio positions. The Portfolio
also may enter into a forward contract to sell an amount of a foreign currency
approximating the value of some or all of the Portfolio's securities denomi-
nated in such currency.
The Portfolio may use forward contracts in one currency or a basket of cur-
rencies to hedge against fluctuations in the value of another currency when
the Adviser anticipates there will be a correlation between the two and may
use forward currency contracts to shift the Portfolio's exposure to foreign
currency fluctuations from one country to another. The purpose of entering
into these contracts is to minimize the risk to the Portfolio from adverse
changes in the relationship between the U.S. dollar and foreign currencies.
The Portfolio may enter into interest rate protection transactions, which
consist of interest rate swaps and interest rate caps, collars and floors, for
hedging purposes. These transactions are commonly referred to as derivatives.
A swap is an agreement to exchange the return generated by one instrument for
the return generated by another instrument. The swaps in which the Portfolio
may also engage include interest rate caps, floors and collars under which one
party pays a single or periodic fixed amount (or premium), and the other party
pays periodic amounts on movement of a specified index.
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<PAGE>
The Portfolio may enter into interest rate protection transactions to pre-
serve a return or spread on a particular investment or portion of its portfo-
lio or to protect against any increase in the price of securities it antici-
pates purchasing at a later date. The Portfolio will enter into interest rate
protection transactions only with banks and recognized securities dealers be-
lieved by the Adviser to present minimal credit risks in accordance with
guidelines established by the Fund's Board of Trustees. Interest rate swaps,
caps, floors and collars will be treated as illiquid securities and will
therefore, be subject to the Portfolio's investment restriction limiting in-
vestment in illiquid securities to no greater than 15% of its net assets.
RISK CONSIDERATIONS. The Portfolio might not employ any of the hedging
strategies described above, and there can be no assurance that any strategy
used will succeed. If the Adviser incorrectly forecasts interest rates, market
values or other economic factors in utilizing a hedging strategy for the Port-
folio, the Portfolio would be in a better position if it had not hedged at
all. In addition, the Portfolio will pay commissions and other costs in con-
nection with such hedging strategies which may increase the Portfolio's ex-
penses and reduce its return.
The use of these strategies involves certain risks, including (1) the fact
that skills needed to use hedging instruments are different from those needed
to select the Portfolio's securities, (2) possible imperfect correlation, or
even no correlation, between price movements of hedging instruments and price
movements of the investments being hedged, (3) the fact that, while hedging
strategies can reduce the risk of loss, they can also reduce the opportunity
for gain, or even result in losses, by offsetting favorable price movements in
hedged investments and (4) the possible inability of the Portfolio to purchase
or sell a security at a time that otherwise would be favorable for it to do
so, or the possible need for the Portfolio to sell a security at a disadvanta-
geous time due to the need for it to maintain "cover" or to segregate securi-
ties in connection with hedging transactions and the possible inability of the
Portfolio to close out or to liquidate its hedged position.
AMERICAN DEPOSITARY RECEIPTS
ADRs are depositary receipts typically used by a U.S. bank or trust company
which evidence ownership of underlying securities issued by a foreign corpora-
tion. Generally, ADRs in registered form are designed for use in the U.S. se-
curities market and ADRs in bearer form are designed for use in securities
markets outside the United States. ADRs may not necessarily be denominated in
the same currency as the underlying securities into which they may be convert-
ed. ADRs may be issued pursuant to sponsored or unsponsored programs. In spon-
sored programs, an issuer has made arrangements to have its securities traded
in the form of depositary receipts. In unsponsored programs, the issuer may
not be directly involved in the creation of the program. Although regulatory
requirements with respect to sponsored and unsponsored programs are generally
similar, in some cases it may be easier to obtain financial information from
an issuer that has participated in the
13
<PAGE>
creation of a sponsored program. Accordingly, there may be less information
programs available regarding issuers of securities underlying unsponsored pro-
grams and there may not be a correlation between such information and the mar-
ket value of the depositary receipts. ADRs also involve the risks of other in-
vestments in foreign securities, as discussed in the Prospectus. For purposes
of the Portfolio's investment policies, the Portfolio's investment in deposi-
tary receipts will be deemed to be investments in the underlying securities
and will not exceed 25% of the Portfolio assets.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The investment objective of the Portfolio is fundamental and may be changed
only with the approval of the holders of a majority of the outstanding shares
of such Portfolio. Except for limitations (a), (b), (d), (e) and (f)(i), the
Portfolio's investment limitations and policies described in this Prospectus
and in the SAI are not
14
<PAGE>
fundamental and may be changed by the Fund's Board of Trustees upon reasonable
notice to investors. All other investment limitations described here and in
the SAI are fundamental policies and may be changed only with the approval of
the holders of a majority of the outstanding shares of the Portfolio. If a
percentage limitation on investment or utilization of assets as set forth
above is adhered to at the time an investment is made, a later change in per-
centage resulting from changes in the value or total cost of the Portfolio's
assets will not be considered a violation of the restriction.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value next deter-
mined after an order is received by the Fund and payment is received by the
Fund or its designated Service Agent (See "VALUATION OF SHARES.") The minimum
initial investment required is $2,000. The minimum initial investment for IRA
accounts is $500. The minimum initial investment for spousal IRA accounts is
$250. Certain exceptions may be permitted by the officers of the Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemption of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding any additional or differ-
ent purchase and redemption conditions. Shareholders who are customers of
Service Agents should consult their Service Agent for information regarding
these fees and conditions. Amounts paid to Service Agents may include transac-
tion fees and/or service fees paid by the Fund from the Fund assets attribut-
able to the Service Agent, and would not be imposed if shares of the Portfolio
were purchased directly from the Fund or the Distributor. The Service Agents
may provide shareholder services to their customers that are not available to
a shareholder dealing directly with the Fund. A salesperson and any other per-
son entitled to receive compensation for selling or servicing Portfolio shares
may receive different compensation with respect to one particular class of
shares over another in the Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent,
15
<PAGE>
or, if applicable, its authorized designee, accepts the order. Orders received
by the Fund in proper form will be priced at the Portfolio's net asset value
next computed after they are accepted by a Service Agent or its authorized
designee. Service Agents are responsible to their customers and the Fund for
timely transmission of all subscription and redemption requests, investment
information, documentation and money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application, and mail it along with a check payable
to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an
account at the next share price calculated for the Portfolio after receipt.
Payment does not need to be converted into Federal Funds (monies credited to
the Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will ac-
cept it for investment. The Fund will not accept third party checks to pur-
chase shares of the Portfolio. If you purchase shares by check, please be sure
that your check is made payable to "UAM Funds."
BY WIRE
. Telephone the UAM Funds Service Center and provide the name, address,
telephone number, social security or taxpayer identification number,
Portfolio selected, amount being wired, and the name of the bank wiring
the funds. The call must be received prior to the close of regular trad-
ing on the NYSE (generally 4:00 p.m. Eastern Time) to receive that days'
price. An account number and a wire control number will be provided to
you, in addition to wiring instructions. Next,
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<PAGE>
. instruct your bank to wire the specified amount to the Fund's custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
Credit DDA Acct. #9102772952
Ref: Portfolio Name
Your Account Name
Your Account Number
Wire Control Number
(assigned by UAM Funds Service Center)
. Forward a completed Application to the UAM Funds Service Center. Federal
Funds purchases will be accepted only on days when the NYSE and the Cus-
todian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased is identified on the check or wire. Prior to wiring additional in-
vestments, please notify the UAM Funds Service Center by calling the number on
the cover of this Prospectus. Mail orders should include, when possible, the
"Invest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action. (See "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN.")
17
<PAGE>
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m., Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of each Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolios are intended to be long-term investment vehicles and are
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lio's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of a Portfolio's shares will be made in full and fractional shares
of the Portfolio calculated to three decimal places. Certificates for frac-
tional shares will not be issued. Certificates for whole shares will not be
issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by a Portfo-
lio in exchange for securities will be issued at net asset value determined as
of the same time. All dividends, interest, subscription, or other rights per-
taining to such securities shall become the property of the Portfolio and must
be delivered to the Fund by the investor upon receipt from the issuer. Securi-
ties acquired through an in-kind purchase will be acquired for investment and
not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
18
<PAGE>
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone, at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of your shares depending
on the market value of the investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or stock assignment specifying the number
of shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required in the case of es-
tates, trusts, guardianships, custodianships, corporations, pension
and profit-sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
19
<PAGE>
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareholder(s)
. redemption where the proceeds are to be sent to an address which is
not the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center or a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when either the NYSE or Custodian Bank are closed, or
under any emergency circumstances as determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of the remaining shareholders of the Fund to make payments
wholly
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<PAGE>
or partly in cash, the Fund may pay the redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by the Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges when they sell portfolio securities received in payment
of redemptions.
The Portfolios reserve the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other Portfolio of the UAM Funds. (See the list of
Portfolios of the UAM Funds at the end of this Prospectus.) Exchange requests
should be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other
21
<PAGE>
portfolios of the UAM Funds. For additional information regarding responsibil-
ity for the authenticity of telephoned instructions, see "REDEMPTION OF
SHARES -- BY TELEPHONE." An exchange into another UAM Funds Portfolio is a
sale of shares and may result in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investments made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or be pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be
22
<PAGE>
attached to the Optional Services Form if a shareholder selects more than one
Portfolio. A Systematic Withdrawal Plan may be terminated or suspended at any
time by the Fund. A shareholder may elect at any time, in writing, to termi-
nate participation in the Systematic Withdrawal Plan. Such written election
must be sent to and received by the Fund before a termination becomes effec-
tive. There is currently no charge to the shareholder for a Systematic With-
drawal Plan.
VALUATION OF SHARES
The net asset value of the Portfolio is determined by dividing the value of
the Portfolio's assets, less any liabilities, by the number of shares out-
standing. The net asset value per share of the Portfolio is determined as of
the close of the NYSE on each day that the NYSE is open for business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost when the Board of Trustees determines that amortized cost
reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
23
<PAGE>
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the address or telephone number on the
cover of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, the Portfolio will normally distribute such
gains annually. All dividends and capital gains distributions will be automat-
ically reinvested in additional shares of the Portfolio unless the Fund is no-
tified in writing that the shareholder elects to receive distributions in
cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Tax -
24
<PAGE>
payer Identification Number you have provided is correct and that you are not
currently subject to backup withholding or that you are exempt from backup
withholding. This certification must be made on the Application or on a sepa-
rate form supplied by the Fund.
Dividends and interest received by each Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
Chicago Asset Management Company (the "Adviser") is a registered investment
adviser formed in 1983. Its business offices are located at 70 West Madison
Street, 56th Floor, Chicago, IL 60602. The Adviser is a wholly-owned subsidi-
ary of United Asset Management Corporation ("UAM"), a holding company, and
provides and offers investment management and advisory services to corpora-
tions, unions, pensions and profit-sharing plans, trusts, estates and other
institutions and investors. As of December 31, 1997, the Adviser had over $2
billion in assets under management.
The Portfolio pays an annual fee in monthly installments to the adviser for
advisory services. This fee is accrued daily and paid monthly as a percentage
of the average daily net assets in the Portfolio for that month. The percent-
age fee on an annual basis is 0.625%. The Adviser has agreed to waive a por-
tion of its advisory fees and to assume certain operating expenses in order to
keep the Portfolio's total operating expenses from exceeding 0.950% of average
daily net assets.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at its own expense, compensate a Service Agent or other person for
marketing, shareholder servicing, recordkeeping and/or other services per-
formed with respect to the Fund, the Portfolio or any Class of Shares of the
Portfolio. Payments for such services may be made out of the paying entities
revenues, its profits or any other source available to it. When such service
arrangements are in effect, they are made generally available to all qualified
service providers.
The Distributor, the Adviser, and certain of their affiliates also partici-
pate, at the date of this prospectus, in an arrangement with Smith Barney Inc.
under which Smith Barney provides certain defined contribution plan marketing
and shareholder services of its Consulting Group and receives .15% of 1% of
the daily net asset value of Institutional Class Shares held by Smith Barney's
eligible customer accounts in addition to amounts payable to all selling deal-
ers. The Fund also compensates Smith Barney for services it provided to cer-
tain defined contribution plan shareholders that are not otherwise provided by
UAMFSI.
25
<PAGE>
The investment professionals at the Adviser responsible for the day-to-day
management of the Portfolio and their qualifications are as follows:
<TABLE>
<C> <S>
Jon F. Holsteen, President, CEO and Chief Investment Officer
Education: Lake Forest College, BA
Experience: Founded Chicago Asset Management Company in 1983.
Kevin J. McGrath, Senior Vice President and Senior Portfolio Manager--
Equities
Education: Regis College, BA
St. Thomas College, MBA
Experience: Joined Chicago Asset Management Company in 1991. Vice
President, Smith Barney, Harris Upham, Inc. 1985-1991.
Donald G. Adams, Vice-President
Education: College of DuPage, AD
Experience: Joined Chicago Asset Management Company in 1996. Vice
President, Zurich Insurance 1986-1996.
</TABLE>
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to the
composite of separately managed accounts of the Adviser that are managed with
substantially similar (although not necessarily identical) objectives, poli-
cies and strategies as those of the Portfolio. The performance data for the
managed accounts is net of all fees and expenses. The investment returns of
the Portfolio may differ from those of the separately managed accounts because
such separately managed accounts may have fees and expenses that differ from
those of the Portfolio. Further, the separately managed accounts are not sub-
ject to investment limitations, diversification requirements and other re-
strictions imposed by the Investment Company Act of 1940 and Internal Revenue
Code; such conditions, if applicable, may have lowered the returns for sepa-
rately managed accounts. The results presented are not intended to predict or
suggest the return to be experienced by the Portfolio or the return an in-
vestor might achieve by investing in the Portfolio.
CHICAGO ASSET MANAGEMENT COMPANY -- EQUITY + CASH COMPOSITE RETURNS
(Percentage Returns Net of Management Fees)
<TABLE>
<CAPTION>
CHICAGO
ASSET
MANAGEMENT
CALENDAR YEARS COMPANY S & P 500
-------------- ---------- ---------
<S> <C> <C>
1985.................................................... 36.1% 32.0%
1986.................................................... 21.9% 18.4%
1987.................................................... 4.7% 5.2%
1988.................................................... 26.4% 16.8%
</TABLE>
26
<PAGE>
<TABLE>
<CAPTION>
CHICAGO
ASSET
MANAGEMENT
CALENDAR YEARS COMPANY S & P 500
-------------- ---------- ---------
<S> <C> <C>
1989.................................................... 21.5% 31.6%
1990.................................................... (8.1)% (3.2)%
1991.................................................... 29.3% 30.6%
1992.................................................... 14.4% 7.6%
1993.................................................... 13.4% 10.1%
1994.................................................... 7.6% 1.3%
1995.................................................... 30.3% 37.6%
1996.................................................... 15.0% 23.0%
1997.................................................... 19.4% 33.4%
3 Months ended 3/31/98.................................. 11.7% 14.0%
Annualized through 3/31/98.............................. 17.9% 18.9%
Cumulative through 3/31/98.............................. 784.3% 886.9%
Thirteen-Year Mean...................................... 17.8% 18.8%
Value of $1 invested during (1/1/85-3/31/98)............ $8.84 $9.87
</TABLE>
CHICAGO ASSET MANAGEMENT COMPANYEQUITY + CASH RETURNS FOR VARIOUS PERIODS
ENDED 3/31/98
(Percentage Returns Net of Management Fees)
<TABLE>
<CAPTION>
PERIODS ENDED 3/31/98 ADVISER S&P 500
--------------------- ------- -------
<S> <C> <C>
One-year period................................................. 36.7% 48.0%
Three-year period (average annual).............................. 22.4% 32.8%
Five-year period (average annual)............................... 18.4% 22.4%
Ten-year period (average annual)................................ 16.4% 18.9%
</TABLE>
- -----------
Notes:
1. The ANNUALIZED return is calculated from monthly data, allowing for com-
pounding Market Value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The CUMULATIVE RETURN means that $1 invested in the account on January 1,
1985 had grown to $8.84 by March 31, 1998.
3. The 13-YEAR MEAN is the arithmetic average of the annual returns for the
calendar years listed.
4. The S&P 500 is an unmanaged index which assumes reinvestment of dividends
and is generally considered representative of securities similar to those
invested in by the Adviser for the purpose of the composite performance
numbers set forth above.
5. The Adviser's average annual management fee over the period shown (1/1/85-
3/31/98) was 0.40% or 40 basis points. During the period, fees on the
Advis -
27
<PAGE>
er's individual accounts ranged from 0.25% to 1.00% (25 basis points to
100 basis points). Net returns to investors vary depending on the manage-
ment fee.
6. The equity + cash composite includes every separate discretionary equity
account as of 3/31/98. As of 3/31/98, this composite included all 35 eq-
uity portfolios, including the equity + cash portions of balanced ac-
counts, totaling $1.4 billion. Leverage has not been used in any portfo-
lios included in this composite. A list of all composites of the Adviser
is available upon request.
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
Rate
-----
Chicago Asset Management Value/Contrarian Portfolio............... 0.06%
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
28
<PAGE>
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or other compensation under the Agreement with respect to this
Portfolio. The Agreement continues in effect as long as such continuance is
approved at least annually by the Fund's Board of Trustees. Those approving
the Agreement must include a majority of Trustees who are neither parties to
the Agreement nor interested persons of any such party. The Agreement provides
that the Fund will bear the costs of the registration of its shares with the
SEC and various states and the printing of its prospectuses, its SAIs and its
reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolios. The Agreements direct the Adviser to use its best efforts to ob-
tain the best available price and most favorable execution for all transac-
tions of the Portfolios. If consistent with the interests of the Portfolios,
the Adviser may select brokers on the basis of the research, statistical and
pricing services they provide to each Portfolio in addition to required serv-
ices. Such brokers may be paid a higher commission than that which another
qualified broker would have charged for effecting the same transaction, pro-
vided that such commissions are paid in compliance with the Securities Ex-
change Act of 1934, as amended, and that the Adviser determines in good faith
that such commission is reasonable in terms either of the transaction or the
overall responsibility of the Adviser to a Portfolio and the Adviser's other
clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of a Portfolio and one or more of these other clients served by the Adviser is
considered at or about the same time, transactions in such securities will be
allocated among the Portfolio and clients in a manner deemed fair and reason-
able by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series
29
<PAGE>
("Portfolios") or classes of shares of beneficial interest without further ac-
tion by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, UMBSC & Co., FBO Interstate Brands Conservative Growth
and UMBSC & Co., FBO Interstate Brands Moderate Growth, held of record 47.8%
and 28.0%, respectively, of the outstanding shares of the Portfolio's Institu-
tional Class for which beneficial ownership is disclaimed or presumed dis-
claimed. The persons or organizations owning 25% or more of the outstanding
shares of the Portfolio may be presumed to "control" (as that term is defined
in the 1940 Act) the Portfolio. As a result, these persons or organizations
could have the ability to vote a majority of the shares of the Portfolio on
any matter requiring the approval of shareholders of the Portfolio.
Both Institutional and Service Class Shares represent an interest in the
same assets of a Portfolio. Service Class Shares bear certain expenses related
to shareholder servicing and the distribution of such shares and have exclu-
sive voting rights with respect to matters relating to distribution expendi-
tures. The Board of Trustees of the Fund has authorized a third class of
shares, Advisor Class Shares, which is not currently being offered by this
Portfolio.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the
holders of not less than 10% of the outstanding shares of the Fund. The Fund
will assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
30
<PAGE>
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover page of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
31
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
32
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Chicago Asset Management Company
70 West Madison Street 56th Floor
Chicago, IL 60602
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
FPA Crescent Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 8
Purchase of Shares......................................................... 15
Redemption of Shares....................................................... 19
Shareholder Services....................................................... 21
Valuation of Shares........................................................ 23
Performance Calculations................................................... 23
Dividends, Capital Gains Distributions and Taxes........................... 24
Investment Adviser......................................................... 25
Administrative Services.................................................... 27
Distributor................................................................ 27
Portfolio Transactions..................................................... 28
General Information........................................................ 28
UAM Funds -- Institutional Class Shares.................................... 30
</TABLE>
<PAGE>
UAM FUNDS
FPA CRESCENT PORTFOLIO
INSTITUTIONAL CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as Portfolios), each
of which has different investment objectives and policies. The FPA Crescent
Portfolio (the "Portfolio") offers two separate classes of shares: Institu-
tional Class Shares and Institutional Service Class Shares ("Service Class
Shares"). Shares of each class represent equal, pro rata interests in a Portfo-
lio and accrue dividends in the same manner except that Service Class Shares
bear fees payable by the class to financial institutions for services they pro-
vide to the owners of such shares. The securities offered in this Prospectus
are Institutional Class Shares of one diversified, no-load Portfolio of the
Fund managed by First Pacific Advisors, Inc.
FPA CRESCENT PORTFOLIO. The FPA Crescent Portfolio's investment objective is
to provide, through a combination of income and capital appreciation, a total
return consistent with reasonable risk. The Portfolio seeks to achieve its ob-
jective by investing primarily in equity securities (common and preferred
stocks) and fixed income obligations.
There can be no assurance that the Portfolio will achieve its objective.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A Statement of Additional Information ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
Transaction fees. However, transaction fees may be charged if a broker-dealer
or other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases....................................... NONE
Sales Load Imposed on Reinvested Dividends............................ NONE
Deferred Sales Load................................................... NONE
Redemption Fees....................................................... NONE
Exchange Fee.......................................................... NONE
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
Investment Advisory Fees.............................................. 1.00%
12b-1 Fees (Including Shareholder Servicing Fees)..................... NONE
Other Expenses........................................................ 0.45%
----
Total Operating Expenses.............................................. 1.45%*
====
</TABLE>
- -----------
* The Adviser has voluntarily agreed to waive all or a portion of its advisory
fees and to assume operating expenses to keep the Portfolio's Institutional
Class Shares' total annual operating expenses (excluding interest, taxes and
extraordinary expenses), after the effect of expense offsets, from exceeding
1.85% of average daily net assets until further notice. The figures above
include the effect of expense offsets. If expense offsets were excluded, To-
tal Operating Expenses of the Portfolio would not be affected. The Adviser
may change or discontinue its fee waivers and expense assumptions at any
time.
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The fees and expenses set forth above are based upon the
Portfolio's Institutional Class Shares' operations during the fiscal year
ended March 31, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
FPA Crescent Portfolio
Institutional Class Shares................. $15 $46 $79 $174
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
First Pacific Advisors, Inc. (the "Adviser") acts as the Portfolio's Adviser
and has its origins dating back to 1954. It currently has over $4.5 billion in
assets under management. The Adviser is an indirect wholly-owned subsidiary of
United Asset Management Corporation ("UAM"). (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $1,000. Certain
exceptions to the initial or minimum investment amounts may be permitted by
the officers of the Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in the form of dividends in June and December. Any realized net
capital gains will be distributed at least annually. Distributions will be re-
invested in the Portfolio's shares automatically unless an investor elects to
receive cash distributions. (See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND
TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administration, fund accounting, divi-
dend disbursing and transfer agency services provided to the Fund and its
Portfolios by third-party service providers. (See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
Prospective investors should understand that the Portfolio's performance
will be affected by a variety of factors since it invests in both stocks and
fixed-income securities. The value of the Portfolio's investments will vary
from day to day, generally reflecting global market, economic and political
developments; conditions in global and national markets; changes in currency
exchange rates; factors affecting individual stocks in the Portfolio; and
shifts in interest rates.
. The Portfolio may invest significantly in lower rated fixed-income secu-
rities, which typically offer higher coupon interest rates than invest-
ment grade securities, but also involve greater risks of default and
market volatility. Such securities are sometimes referred to as "junk
bonds" and are considered speculative by rating agencies.
. The Portfolio may engage in short sales of securities, which involve the
risk of loss if the securities increase in price between the time the
Portfolio sells them short and repurchases them.
. The Portfolio may invest in repurchase agreements which entail a risk of
loss should the seller default on its transaction.
. The Portfolio may lend its investment securities which entails a risk of
loss should a borrower fail financially.
. The Portfolio may purchase securities on a when-issued basis which do
not earn interest until issued and may decline or appreciate in market
value prior to their delivery to the Portfolio.
. The Portfolio may engage in various hedging, currency and related strat-
egies to seek to hedge its investments against movements in security
prices, interest rates, and exchange rates by the use of derivatives,
including forward contracts, options and futures as well as options on
futures. These strategies involve the risk of imperfect correlation in
movements in the price of options and futures and movements in the price
of securities, interest rates or currencies which are the subject of the
hedge. These transactions are also subject to the risk factors associ-
ated with foreign investments generally. There can be no assurance that
a liquid secondary market for these hedging techniques will exist at any
specific time. The use of derivatives, if employed incorrectly, may ad-
versely affect the Portfolio.
Further information about each of the above risk factors and others is con-
tained in the "OTHER INVESTMENT POLICIES" section of this Prospectus.
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented of the Portfolio's Institutional
Class Shares. This table is part of the Portfolio's Annual Financial State-
ments, which are included in the Portfolio's 1998 Annual Report to Sharehold-
ers. The Report is incorporated by reference into the Portfolio's SAI. The
Portfolio's Annual Financial Statements have been audited by Tait, Weller &
Baker, independent accountants, for the fiscal years ended 1994, 1995 and
1996, and by PricewaterhouseCoopers LLP for the fiscal years ended March 31,
1997 and 1998, whose unqualified opinion thereon is incorporated in the Port-
folio's SAI. The following information should be read in conjunction with the
Portfolio's 1998 Annual Report. The Report is incorporated into the SAI. Fur-
ther information about the Portfolio's performance is contained in its Annual
Report, which may be obtained without charge by calling the telephone number
on the Prospectus cover page.
<TABLE>
<CAPTION>
JUNE 2,
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 1993+ TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1998++ 1997 1996 1995 1994
---------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 13.46 $ 12.67 $ 11.23 $ 10.96 $ 10.00
-------- ------- ------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income.. 0.55 0.31 0.40 0.21 0.13
Net Realized and
Unrealized Gain on
Investments........... 2.88 2.16 2.29 0.77 0.99
-------- ------- ------- ------- -------
Total From Investment
Operations............ 3.43 2.47 2.69 0.98 1.12
-------- ------- ------- ------- -------
DISTRIBUTIONS
Net Investment Income.. (0.40) (0.34) (0.37) (0.18) (0.10)
Net Realized Gains..... (0.26) (1.34) (0.88) (0.53) (0.06)
-------- ------- ------- ------- -------
Total Distributions.... (0.66) (1.68) (1.25) (0.71) (0.16)
-------- ------- ------- ------- -------
NET ASSET VALUE, END OF
PERIOD................. $ 16.23 $ 13.46 $ 12.67 $ 11.23 $ 10.96
======== ======= ======= ======= =======
TOTAL RETURN............ 25.96% 20.61% 24.71% 9.35% 11.40%**
======== ======= ======= ======= =======
RATIOS/SUPPLEMENTAL
DATA:
NET ASSETS, END OF
PERIOD (THOUSANDS)..... $247,833 $65,619 $22,025 $15,990 $10,174
RATIO OF EXPENSES TO
AVERAGE NET ASSETS:
Before Expense
Reimbursement and
Offset................ 1.45% 1.60% 1.59% 1.65% 1.86%*
After Expense
Reimbursement and
Offset................ 1.45% 1.57% 1.59% 1.65% 1.85%*
RATIO OF NET INVESTMENT
INCOME TO AVERAGE NET
ASSETS:
Before Expense
Reimbursement and
Offset................ 3.62% 2.77% 3.35% 2.16% 1.60%*
After Expense
Reimbursement and
Offset................ 3.62% 2.80% 3.35% 2.16% 1.61%*
Portfolio Turnover
Rate................... 18% 45% 100% 101% 89%**
Average Commission Rate
Paid#.................. $ 0.0564 $0.0521 N/A N/A N/A
</TABLE>
- -----------
* Annualized.
** Not Annualized.
+ Commencement of Operations.
++ Per share amounts for the year ended March 31, 1998 are based on average
outstanding shares.
# For fiscal years ending on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for security trades on
which commissions are charged.
5
<PAGE>
INVESTMENT OBJECTIVE
The investment objective of the Portfolio is to provide, through a combina-
tion of income and capital appreciation, a total return consistent with rea-
sonable investment risk. The Portfolio seeks to achieve its objective by in-
vesting in a combination of equity securities and fixed-income obligations.
There is, of course, no assurance that the Portfolio's objective will be
achieved. Because prices of common stocks and fixed-income securities fluctu-
ate, the value of an investment in the Portfolio will vary, as the market
value of its investment portfolio changes.
The Portfolio actively seeks value in all parts of a company's capital
structure, including common and preferred stocks, as well as corporate and
convertible bonds. The Portfolio will typically have between 50% and 70% of
its total assets invested in equity securities with the balance comprised of
fixed-income securities and cash and equivalents.
INVESTMENT POLICIES
EQUITY SECURITIES
The Adviser utilizes a contrarian investment style, which often leads the
Adviser to invest in "what other people do not wish to own." The Adviser
searches for common stocks, preferred stocks, warrants and convertible securi-
ties that reflect low price/earnings ratios (P/Es) and trade at discounts to
private market value.
The Adviser selects equity securities for the Portfolio which it believes
offer superior investment value. The Adviser deems the following important in
its stock selection process:
.High return on capital
.Solid balance sheet
.Meaningful cash flow
.Active share repurchase program
.Insider buying
.Superior management seeking to maximize shareholder value
.Projected earnings growth exceeding the stock market average
In the Adviser's view, the stock market prices securities efficiently in the
long term, rewarding companies which successfully grow their earnings and pe-
nalizing those which do not. The Adviser's investment philosophy is based on
the conviction that the market valuation of securities is often inefficient in
the short-term. When reacting to current economic or company information, in-
vestors frequently make purchase or sale decisions hastily. These decisions
could cause a particular security, industry group or the entire market to be-
come underpriced or overpriced in the short-term thereby creating an excellent
opportunity to either buy or sell.
6
<PAGE>
This contrarian style leads to those investments that offer absolute value,
rather than relative value. Absolute value is an investment that trades at
substantial discount to private market value, rather than one that might ap-
pear inexpensive based on a discount to its peer group or the market average.
Attention is directed toward those companies offering the best combination of
such quality criteria as strong market share, good management and high normal-
ized return on capital. A company purchased might not look inexpensive, con-
sidering current earnings and return on capital; however, this may reflect
such conditions as a weak economy, an increase in their raw material costs,
poor management, or any number of other temporary considerations. The price
drops caused by such developments can and often do provide buying opportuni-
ties.
Intensive research identifies these opportunities. The process includes
looking for ideas by reviewing stock price or industry group under-perfor-
mance, insider purchases, management changes and corporate spin-offs. Funda-
mental analysis is the foundation of the Adviser's investment approach. Re-
searching a prospective investment involves communicating directly with com-
pany management, suppliers, and customers, better defining future potential,
financial strength and the company's competitive position. Fundamental analy-
sis provides a thorough view of financial and business characteristics, al-
lowing for the determination of absolute value.
In addition to common stocks, equity securities purchased for the Portfolio
may include preferred stocks, convertible preferred stocks and warrants.
FIXED-INCOME OBLIGATIONS
Through fixed-income investments, the Adviser seeks a reliable and recurring
stream of income for the Portfolio, while preserving its capital. The Adviser
attempts to identify the current interest rate trends and invests funds ac-
cordingly. Usually, a defensive interest rate strategy is employed, with in-
vestments made at different points along the yield curve in an attempt to keep
the average maturity of fixed-income investments less than or equal to ten
years.
The Adviser's approach is to invest in U.S. Treasury obligations, U.S. Gov-
ernment Agency and mortgage-backed securities, and corporate and convertible
bonds. The Adviser considers yield spread relationships and their underlying
factors such as credit quality, investor perception and liquidity on a contin-
uous basis to determine which sector offers the best investment value. When
combined with equity securities, the ownership of fixed-income securities not
only broadens the universe of opportunities, but offers additional diversifi-
cation and can help lower portfolio volatility.
The Adviser may invest in corporate bonds with yields substantially higher
than those of government securities. Opportunities frequently present them-
selves in parts of the capital structure of a company beyond common and pre-
ferred stock,
7
<PAGE>
including convertible and high yield bonds. Generally, these investments pro-
vide a return in excess of government securities and can provide potential for
capital appreciation. Historic returns for high yield bonds have been greater
than government securities. The Adviser's analysis includes studying interest
expense coverage, business value/debt coverage and current business trends.
The Portfolio may purchase investment-grade corporate debt securities. Secu-
rities rated BBB by Standard & Poor's Ratings Services ("S&P") or Moody's In-
vestors Service ("Moody's") are investment grade, but Moody's considers secu-
rities rated Baa to have speculative characteristics. Changes in economic con-
ditions or other circumstances are more likely to lead to a weakened capacity
for such securities to make principal and interest payments than is the case
for higher-rated debt securities.
OTHER INVESTMENT POLICIES
LOWER RATED SECURITIES
The Portfolio may invest in debt securities that are rated below investment
grade, but will limit that investment to no more than 30% of its total assets.
Such securities, sometimes referred to as "junk bonds," typically carry higher
coupon rates than investment grade securities but also involve higher risks
and are described as speculative by both Moody's and S&P. They may be subject
to greater market price fluctuations, less liquidity, and greater risk of in-
come or principal, including a greater possibility of default or bankruptcy of
the issuer of such securities, than are more highly rated debt securities.
Lower rated fixed income securities also are likely to be more sensitive to
adverse economic or company developments and more subject to price fluctua-
tions in response to changes in interest rates. The market for lower-rated
debt issues generally is thinner and less active than that for higher quality
securities, which may limit the Portfolio's ability to sell such securities at
fair value in response to changes in the economy or financial markets.
The Adviser seeks to reduce the risk associated with investing in such secu-
rities by limiting the Portfolio's holdings in such securities and by the
depth of its own credit analysis. In selecting below investment grade securi-
ties, the Adviser seeks securities in companies with improving cash flows and
balance sheet prospects, whose credit ratings the Adviser views as likely to
be upgraded. The Adviser believes that such securities can produce returns
similar to equities, but with less risk. See the SAI for further discussion of
lower rated securities.
REPURCHASE AGREEMENTS
The Portfolio may enter into repurchase agreements in order to earn addi-
tional income on available cash, or as a defensive investment in periods when
the Portfolio is primarily in short-term maturities. A repurchase agreement is
a short-term investment in which the purchaser (i.e., the Portfolio) acquires
ownership of a security (which may be of any maturity) and the seller agrees
to repurchase that obligation
8
<PAGE>
at a future time at a set price, thereby determining the yield during the pur-
chaser's holding period (usually not more than seven days from the date of
purchase). Any repurchase transaction in which the Portfolio engages will re-
quire full collateralization of the seller's obligation during the entire term
of the repurchase agreement. In the event of a bankruptcy or other default of
the seller, the Portfolio could experience both delays in liquidating the un-
derlying security and losses in value. However, the Portfolio intends to enter
into repurchase agreements only with banks with assets of $500 million or more
that are insured by the Federal Deposit Insurance Corporation and the most
creditworthy registered securities dealers pursuant to procedures adopted and
regularly reviewed by the Fund's Board of Trustees. The Adviser monitors the
creditworthiness of the banks and securities dealers with whom the Portfolio
engages in repurchase transactions. The Fund has received permission from the
SEC to pool daily uninvested cash balances of the Fund's Portfolios in order
to invest in repurchase agreements on a joint basis. By entering into joint
repurchase agreements, the Portfolio may incur lower transaction costs and
earn higher rates of interest on joint repurchase agreements. The Portfolio's
contribution would determine its return from a joint repurchase agreement.
ILLIQUID AND RESTRICTED SECURITIES
The Portfolio may not invest more than 15% of its net assets in illiquid se-
curities, including (i) securities for which there is no readily available
market; (ii) securities the disposition of which would be subject to legal re-
strictions (so-called "restricted securities"); and (iii) repurchase agree-
ments having more than seven days to maturity. A considerable period of time
may elapse between the Portfolio's decision to dispose of such securities and
the time when the Portfolio is able to dispose of them, during which time the
value of the securities could decline. Restricted securities do not include
those which meet the requirements of Securities Act Rule 144A and which the
Trustees have determined to be liquid based on the applicable trading markets.
FOREIGN SECURITIES
The Portfolio may invest up to 20% of its total assets in securities of for-
eign issuers. The Adviser usually buys securities of larger foreign companies
that have well recognized franchises and are selling at a discount to the se-
curities of similar domestic businesses.
There may be less publicly available information about these issuers than is
available about companies in the U.S. and foreign auditing requirements may
not be comparable to those in the U.S. In addition, the value of the foreign
securities may be adversely affected by movements in the exchange rates be-
tween foreign currencies and the U.S. dollar, as well as other political and
economic developments, including the possibility of expropriation, confisca-
tory taxation, exchange controls or other foreign governmental restrictions.
The Portfolio may also invest without limit in securities of foreign issuers
which are listed on a domestic national
9
<PAGE>
securities exchange. Additionally, there may be difficulty in obtaining and
enforcing judgments against foreign issuers.
SHORT SALES
The Portfolio may engage in short sales of securities. In a short sale, the
Portfolio sells stock which it does not own, making delivery with securities
"borrowed" from a broker. The Portfolio is then obligated to replace the secu-
rity borrowed by purchasing it at the market price at the time of replacement.
This price may or may not be less than the price at which the security was
sold by the Portfolio. Until the security is replaced, the Portfolio is re-
quired to pay to the lender any dividends or interest which accrue during the
period of the loan. In order to borrow the security, the Portfolio may also
have to pay a fee which would increase the cost of the security sold. The pro-
ceeds of the short sale will be retained by the broker, to the extent neces-
sary to meet margin requirements, until the short position is closed out.
The Portfolio also must deposit in a segregated account an amount of cash or
liquid assets equal to the difference between (a) the market value of the se-
curities sold short at the time they were sold short and (b) the value of the
collateral deposited with the broker in connection with the short sale (not
including the proceeds from the short sale). While the short position is open,
the Portfolio must maintain daily the segregated account at such a level that
(1) the amount deposited in it plus the amount deposited with the broker as
collateral equals the current market value of the securities sold short and
(2) the amount deposited in it plus the amount deposited with the broker as
collateral is not less than the market value of the securities at the time
they were sold short.
The Portfolio will incur a loss as a result of the short sale if the price
of the security increases between the date of the short sale and date on which
the Portfolio replaces the borrowed security. The Portfolio will realize a
gain if the security declines in price between those dates. The amount of any
gain will be decreased and the amount of any loss will be increased by any in-
terest the Portfolio may be required to pay in connection with the short sale.
The dollar amount of short sales at any one time (not including short sales
against the box) may not exceed 25% of the net assets of the Portfolio.
A short sale is "against-the-box" if at all times when the short position is
open the Portfolio owns an equal amount of the securities or securities con-
vertible into, or exchangeable without further consideration for, securities
of the same issue as the securities sold short.
OPTIONS AND FUTURES
The Portfolio may purchase and write call and put options on securities, se-
curities indexes and on foreign currencies, and enter into futures contracts
and use
10
<PAGE>
options on futures contracts. The Portfolio may use these techniques to hedge
against changes in interest rates, foreign currency exchange rates or securi-
ties prices or as part of its overall investment strategies. The Portfolio is
subject to regulatory limitations on the use of such techniques and is re-
quired to maintain segregated accounts consisting of cash or liquid securities
(or, as permitted by applicable regulation, enter into certain offsetting po-
sitions) to cover its obligations under options and futures contracts to avoid
leveraging of the Portfolio.
The Portfolio may buy or sell interest rate futures contracts, options on
interest rate futures contracts and options on debt securities for the purpose
of hedging against changes in the value of securities which the Fund owns or
anticipates purchasing due to anticipated changes in interest rates. The Port-
folio also may engage in currency exchange transactions by means of buying or
selling foreign currency on a spot basis, entering into foreign currency for-
ward contracts, and buying and selling foreign currency options, futures and
options on futures. Foreign currency exchange transactions may be entered into
for the purpose of hedging against foreign currency exchange risk arising from
the Portfolio's investment or anticipated investment in securities denominated
in foreign currencies.
See the SAI for further information regarding characteristics of and risks
involved in the use of these instruments.
U.S. GOVERNMENT SECURITIES
The Portfolio may invest in U.S. Government securities. U.S. Government se-
curities include direct obligations issued by the U.S. Treasury, such as Trea-
sury bills, certificates of indebtedness, notes and bonds. U.S. Government
agencies and instrumentalities that issue or guarantee securities include, but
are not limited to, the Federal National Mortgage Association ("FNMA"), Gov-
ernment National Mortgage Association ("GNMA"), Federal Home Loan Bank, Fed-
eral Financing Bank, and Student Loan Marketing Association.
All Treasury securities are backed by the full faith and credit of the
United States. Obligations of U.S. Government agencies and instrumentalities
may or may not be supported by the full faith and credit of the United States.
Some, such as the Federal Home Loan Bank, are backed by the right of the
agency or instrumentality to borrow from the Treasury. Others, such as securi-
ties issued by the Federal National Mortgage Association, are supported only
by the credit of the instrumentality and not by the Treasury. If the securi-
ties are not backed by the full faith and credit of the United States, the
owner of the securities must look principally to the agency issuing the obli-
gation for repayment and may not be able to assert a claim against the United
States in the event that the agency or instrumentality does not meet its com-
mitment.
INFLATION-INDEXED BONDS
Inflation-indexed bonds are securities whose principal value is periodically
adjusted to reflect the rate of inflation. Such bonds are generally issued at
an
11
<PAGE>
interest rate lower than comparable non-indexed bonds, but are expected to re-
tain their principal value over time. The interest rate on these bonds is
fixed at issuance, but over the life of the bond this interest may be paid on
an increasing principal value, which has been adjusted for inflation. Infla-
tion indexed-bonds issued by the U.S. Treasury have maturities of ten years,
although it is anticipated that securities with other maturities will be is-
sued in the future. If the periodic adjustment rate measuring inflation falls,
the principal value of inflation-indexed bonds will be adjusted downward, and
consequently the interest payable on these securities (calculated with respect
to a smaller principal amount) will be reduced. Repayment of the original bond
principal upon maturity (as adjusted for inflation) is guaranteed in the case
of U.S. Treasury inflation-indexed bonds, even during a period of deflation.
However, the current market value of the bonds is not guaranteed, and will
fluctuate. Any increase in the principal amount of an inflation-indexed bond
is considered taxable ordinary income, even though investors do not receive
their principal until maturity.
MORTGAGE BACKED SECURITIES
The Portfolio may invest in mortgage-backed securities. Mortgage-backed se-
curities are collateralized by pools of mortgages assembled for subsequent
sale to investors by various governmental agencies and sponsored organizations
as well as by private issuers. The underlying assets collateralizing the mort-
gage-backed securities may include single-family, multi-family and commercial
properties. The two fundamental forms of mortgage-backed securities are pass-
throughs and collateralized mortgage obligations ("CMOs"). Pass-throughs pro-
duce monthly payments of principal and interest from the underlying mortgages.
CMOs divide the cash flows generated from the underlying mortgages or mortgage
pass-through securities into different segments known as "tranches," which are
then retired sequentially over time in order of priority. The market value and
yield of mortgage-backed securities will fluctuate due to market interest rate
change and prepayment variability of the underlying mortgages. As prepayment
rates on mortgages vary widely, it is difficult to accurately predict the av-
erage maturity of a particular pool of mortgages or tranches of CMOs. Although
mortgage-backed securities may offer higher yields than those available from
other types of securities, they may be less effective than other types of se-
curities as means of "locking in" an attractive rate for an extended period
because of the prepayment feature. Prepayment risk has two important effects.
First, like bonds in general, mortgage-backed securities will generally de-
cline in price when interest rates rise. Second, when interest rates fall and
additional mortgage prepayments must be reinvested at lower interest rates, a
Portfolio's rate of interest income may be reduced. Mortgage-backed securities
in which the Portfolio may invest will either carry a guarantee from an agency
of the U.S. Government or a private issuer of the timely payment of principal
and interest or will be suitably structured to be considered by the Adviser to
be of investment grade quality.
12
<PAGE>
PORTFOLIO TURNOVER
In general, the Adviser will not consider the rate of portfolio turnover to
be a limiting factor in determining when or whether to purchase or sell secu-
rities in order to achieve the Portfolio's objective. The table set forth in
"Financial Highlights" presents the Portfolio's historical turnover rates. In
addition to portfolio trading costs, higher rates of portfolio turnover may
result in the realization of capital gains. To the extent net short-term capi-
tal gains are realized, any distributions resulting from such gains are con-
sidered ordinary income for federal income tax purposes. See "DIVIDENDS, CAPI-
TAL GAINS DISTRIBUTIONS AND TAXES" for more information on taxation.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's or if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for
investment purposes, into one or more joint accounts and to invest the daily
balance of the joint accounts in the following short-term investments: fully
collateralized repurchase agreements, interest-bearing or discounted
commercial paper including dollar-denominated commercial paper of foreign
issuers, and any other short-term money market instruments including variable
rate demand notes and other tax-exempt money instruments. By entering into
these investments on a joint basis, the Portfolio may earn a higher rate of
return on investments relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest for cash management purposes the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
13
<PAGE>
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. "Delayed settlement" is a term used to describe settle-
ment of a securities transaction in the secondary market which will occur
sometime in the future. No payment or delivery is made by the Portfolio until
it receives delivery or payment from the other party to any of the above
transactions. It is possible that the market price of the securities at the
time of delivery may be higher or lower than the purchase price. The Portfolio
will maintain a separate account of cash or liquid securities at least equal
to the value of the purchase commitments until payment is made. Typically, no
income accrues on securities purchased on a delayed delivery basis prior to
the time delivery of the securities is made although the Portfolio may earn
income on securities it has deposited in a segregated account.
The Portfolio engages in these types of purchases in order to buy securities
that fit with its investment objectives at attractive prices--not to increase
its investment leverage.
Securities purchased on a when-issued basis may decline or appreciate in
market value prior to their actual delivery to the Portfolio.
LENDING OF PORTFOLIO SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan portfolio
securities to the extent that greater than one-third of its total assets at
fair market value, would be committed to loans. By lending its investment se-
curities, the Portfolio attempts to increase its income through the receipt of
interest on the loan. Any gain or loss in the market price of the securities
loaned that might occur during the term of the loan would be for the account
of the Portfolio. All relevant facts and circumstances, including the credit-
worthiness of the broker, dealer or institution, will be considered by the Ad-
viser in making decisions with respect to the lending of securities, subject
to review by the Fund's Board of Trustees.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by the investment company's Board of Trustees. The Portfolio will
continue to retain any voting rights with respect to the loaned securities. If
a material event occurs affecting an investment on loan, the loan must be
called and the securities voted.
14
<PAGE>
INVESTMENT COMPANIES
As permitted by the 1940 Act, the Portfolio reserves the right to invest up
to 10% of its total assets, calculated at the time of investment, in the secu-
rities of other open-end or closed-end investment companies. No more than 5%
of the investing Portfolio's total assets may be invested in the securities of
any one investment company nor may it acquire more than 3% of the voting secu-
rities of any other investment company. The Portfolio will indirectly bear its
proportionate share of any management fees paid by an investment company in
which it invests in addition to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
The Portfolio has adopted certain investment restrictions, which are de-
scribed fully in the SAI. Like the Portfolio's investment objective, most of
these restrictions are fundamental and may be changed only by a majority vote
of the Portfolio's outstanding shares.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated Service Agent. (See "VALUATION OF SHARES.") The
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $1,000. Certain exceptions may be made by the officers of
the Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemptions of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding additional or different
purchase or redemption conditions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. Amounts paid to Service Agents may include transaction fees
and/or service fees paid by the Fund
15
<PAGE>
from the Fund assets attributable to the Service Agent, which would not be im-
posed if shares of the Portfolio were purchased directly from the Fund or the
Distributor. Service Agents may provide shareholder services to their custom-
ers that are not available to a shareholder dealing directly with the Fund. A
salesperson and any other person entitled to receive compensation for selling
or servicing Portfolio shares may receive different compensation with respect
to one particular class of shares over another in the Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than the
close of regular trading on the New York Stock Exchange ("Exchange") on the
following business day. If payment is not received by the Fund's Sub-Transfer
Agent, Chase Global Funds Services Company ("CGFSC"), by such time, the Serv-
ice Agent could be held liable for resulting fees or losses. A Portfolio may
be deemed to have received a purchase or redemption order when a Service
Agent, or, if applicable, its authorized designee, accepts the order. Orders
received by the Fund in proper form will be priced at the Portfolio's net as-
set value next computed after they are accepted by a Service Agent or its au-
thorized designee. Service Agents are responsible to their customers and the
Fund for timely transmission of all subscription and redemption requests, in-
vestment information, documentation and money.
INITIAL INVESTMENTS
BY MAIL
. Complete and sign an Application and mail it together with a check made
payable to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure your
check is made payable to "UAM Funds".
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring
16
<PAGE>
the funds. The call must be received prior to the close of regular trad-
ing on the Exchange (generally 4:00 p.m. Eastern Time) to receive that
day's price. An account number and wire control number will then be pro-
vided to you in addition to wiring instructions. Next,
. Instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name
Your Account Number
Your Account Name
Wire Control Number
(assigned by UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the Exchange and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investors bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should com -
17
<PAGE>
plete the bank information section on the Account Application and attach a
voided check or deposit slip to the Account Application. This option must be
established on your account at least 15 days prior to your initiating an ACH
transaction (see "SHAREHOLDER SERVICES - AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the Exchange (gener-
ally 4:00 p.m. Eastern Time) will be invested at the share price calculated
after the Exchange closes on that day. Investments received after the close of
the Exchange will be executed at the price computed on the next day the Ex-
change is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be a long-term investment vehicle and is
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lios performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be included in
the Portfolio (current market quotations must be readily available for
such securities);
18
<PAGE>
. the investor represents and agrees that all securities offered to be ex-
changed are liquid securities and not subject to any restrictions upon
their sale by the Portfolio under the Securities Act of 1933, or other-
wise; and
. the value of any such securities (except U.S. Government securities) be-
ing exchanged together with other securities of the same issuer owned by
the Portfolio will not exceed 5% of the net assets of the Portfolio im-
mediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. Any redemption may be more or less than the
purchase price of the shares depending on the market value of investment secu-
rities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of shares
or dollar amount to be redeemed, signed by all registered owners of the
shares in the exact names in which they are registered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of es-
tates, trusts, guardianships, custodianships, corporations, pension and
profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the wire
redemption privilege) by completing appropriate sections of the Applica-
tion; and
. call the Fund and instruct that the redemption proceeds be mailed to you
or wired to your bank.
19
<PAGE>
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated to
receive redemption proceeds (this can be accomplished only by a written
request signed by each shareholder, with each signature guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent do not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than the
registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other than
the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The
20
<PAGE>
Fund may suspend the right of redemption or postpone the date at times when
both the Exchange and Custodian Bank are closed, or under any emergency cir-
cumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by the Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the Exchange (generally 4:00 p.m. Eastern Time)
will be processed as of the close of business on the same day. Requests re-
ceived after the close of regular
21
<PAGE>
trading on the Exchange will be processed on the next business day. The Fund
may modify or terminate the exchange program at any time upon 60 days' written
notice to shareholders, and may reject any exchange request. If the Fund's
management determines that an investor is engaged in excessive trading, the
Fund, with or without prior notice may reject in whole or part any exchange
request, with respect to such investor's account. Such investors also may be
barred from exchanging into other portfolios of the UAM Funds. For additional
information regarding responsibility for the authenticity of telephoned in-
structions, see "REDEMPTION OF SHARES -- BY TELEPHONE." An exchange into an-
other UAM Funds Portfolio is a sale of shares and may result in a gain or loss
for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or by pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days
22
<PAGE>
after the redemption date. Because the value of the Portfolio's shares fluctu-
ate, the number of shares redeemed to finance systematic withdrawal payments
or a given amount will vary from payment to payment. If a shareholder owns
shares in more than one Portfolio, the shareholder must designate the Portfo-
lio from which the redemptions under a Systematic Withdrawal Plan should be
made. An additional sheet may be attached to the Optional Services Form if a
shareholder selects more than one Portfolio. A Systematic Withdrawal Plan may
be terminated or suspended at any time by the Fund. A shareholder may elect at
any time, in writing, to terminate participation in the Systematic Withdrawal
Plan. Such written election must be sent to and received by the Fund before a
termination becomes effective. There is currently no charge to the shareholder
for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the Exchange on each day that the Exchange is open
for business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date are valued neither exceeding the cur-
rent ask prices nor less than the current bid prices. The prices for securi-
ties denominated in a foreign currency are converted to U.S. dollars based
upon the bid price of the foreign currency against U.S. dollars quoted by any
major bank or by a broker.
Bonds and other fixed-income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed-income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Board of Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended
23
<PAGE>
to indicate future performance. Yield and total return are calculated sepa-
rately for each class of the Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount, except that service and distribution fees and any
incremental transfer agency costs relating to Service Class Shares will be
borne exclusively by that class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the address or telephone number on the
cover of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in dividends in June and Decem-
ber. If any net capital gains are realized, the Portfolio will normally dis-
tribute them in June, with a supplemental distribution in December of any un-
distributed capital gains earned during the 12 month period ended each Octo-
ber. All dividends and capital gains distributions will be automatically rein-
vested in additional shares of the Portfolio unless the Fund is notified in
writing that the shareholder elects to receive the distributions in cash.
24
<PAGE>
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of the tax status of dividends and capital gain distribu-
tions received.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that the Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
First Pacific Advisors, Inc., located at 11400 West Olympic Blvd., Suite
1200, Los Angeles, CA 90064, acts as the Portfolio's Adviser; Mr. Steven
Romick is primarily responsible for management of the Portfolio. Mr. Romick
has 13 years of experience in the investment management business. He is cur-
rently a Senior Vice President of the Adviser. From 1990-1996, Mr. Romick was
chairman of Crescent Management, an investment advisory firm he founded. Cres-
cent Management served as the Portfolio's adviser until the firm was merged
with the current Adviser.
25
<PAGE>
Under an Investment Advisory Agreement dated as of September 30, 1996, the
Adviser provides the Portfolio with advice on buying and selling securities,
manages the investments of the Portfolio, furnishes the Portfolio with office
space and certain administrative services, and provides most of the personnel
needed by the Portfolio. As compensation, the Portfolio pays the Adviser a
monthly management fee (accrued daily) based upon the average daily net assets
of the Portfolio at the rate of 1.00% annually.
The Adviser, together with its predecessors, has been in the investment ad-
visory business since 1954. Presently, the Adviser manages assets of approxi-
mately $4.5 billion for seven investment companies, including one closed-end
investment company, and more than 25 institutional accounts. The Adviser is an
indirect wholly-owned subsidiary of UAM, an Exchange-listed holding company
principally engaged, through affiliated firms, in providing institutional in-
vestment management and acquiring institutional investment management firms.
The Portfolio is responsible for its own operating expenses. The Adviser has
voluntarily agreed to waive all or a portion of its advisory fees and to as-
sume operating expenses to keep the Portfolio's Institutional Class Shares'
total annual operating expenses (excluding interest, taxes and extraordinary
expenses), after the effect of expense offsets, from exceeding 1.85% of aver-
age daily net assets until further notice. To the extent the Adviser performs
a service for which the Portfolio is obligated to pay, the Portfolio shall re-
imburse the Adviser for its costs incurred in rendering such service.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at their own expense, compensate a Service Agent or other person
for marketing, shareholder servicing, recordkeeping and/or other services per-
formed with respect to the Fund, the Portfolio or any Class of Shares of the
Portfolio. The person making such payments may do so out of its revenues, its
profits or any other source available to it. Such service arrangements, when
in effect, are made generally available to all qualified service providers.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and other shareholder services and receives from such entities .15 of
1% of the daily net asset value of Institutional Class Shares held by Smith
Barney's eligible customer accounts in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by the Administrator.
26
<PAGE>
ADMINISTRATIVE SERVICES
UAMFSI, a wholly-owned subsidiary of UAM, is responsible for performing and
overseeing administrative, fund accounting, dividend disbursing and transfer
agent services provided to the Fund and its Portfolios. UAMFSI's principal of-
fice is located at 211 Congress Street, Boston, MA 02110. UAMFSI has subcon-
tracted some of these services to CGFSC, an affiliate of The Chase Manhattan
Bank, by a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is lo-
cated at 73 Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
FPA Crescent Portfolio............................................... 0.06%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Funds assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, with its
principal office located at 211 Congress Street, Boston, MA 02110, distributes
shares of the Fund. Under the Distribution Agreement (the "Agreement"), the
Distributor, as agent of the Fund, agrees to use its best efforts as sole dis-
tributor of Fund shares. The Distributor does not receive any fee or other
compensation under the Agreement with respect to the Portfolio's Institutional
Class Shares offered in this Prospectus. The Agreement continues in effect as
long as it is approved at least annually by the Fund's Board of Trustees.
Those approving the Agreement must include a majority of Trustees who are nei-
ther parties to the Agreement nor interested persons of any such party. The
Agreement provides that the Fund will bear costs of registration of its shares
with the SEC and various states and the printing of its prospectuses, its SAIs
and its reports to shareholders.
27
<PAGE>
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to the Portfolio in addition to required services. Such bro-
kers may be paid a higher commission than that which another qualified broker
would have charged for effecting the same transaction, provided that such com-
missions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same, transactions in such securities will be
allocated among the Portfolio and other clients in a manner deemed fair and
reasonable by the Adviser. Although there is no specified formula for allocat-
ing such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Charles Schwab & Co., Inc., Reinvest Account, held of
record 48.8% of the outstanding shares of the Portfolio's Institutional Class
28
<PAGE>
and Wilmington Trust Co., Trustee, FBO FIGGIE Institutional Retirement &
Profit Sharing Trust, held of record 41.5% of the outstanding shares of the
Portfolio's Service Class for which beneficial ownership is disclaimed or pre-
sumed disclaimed. The persons or organizations owning 25% or more of the out-
standing shares of a Portfolio may be presumed to "control" (as that term is
defined in the 1940 Act) such Portfolio. As a result, those persons or organi-
zations could have the ability to vote a majority of the shares of the Portfo-
lio on any matter requiring the approval of shareholders of such Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of the Portfolio. Service Class Shares bear certain expenses
related to shareholder servicing and the distribution of such shares and have
exclusive voting rights for matters relating to such distribution expendi-
tures. The Board of Trustees of the Fund has authorized a third class of
shares, Advisor Class Shares, which is not currently being offered by this
Portfolio. For information about the Service Class Shares of the Portfolio,
contact the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR IN THE PORTFOLIO'S
STATEMENT OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY
THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH
OFFERING MAY NOT BE LAWFULLY MADE.
29
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
30
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
First Pacific Advisors, Inc.
11400 West Olympic Boulevard
Suite 1200
Los Angeles, CA 90064
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
FPA Crescent Portfolio
Institutional Service Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 8
Purchase of Shares......................................................... 16
Redemption of Shares....................................................... 20
Service and Distribution Plans............................................. 22
Shareholder Services....................................................... 24
Valuation of Shares........................................................ 25
Performance Calculations................................................... 26
Dividends, Capital Gains Distributions and Taxes........................... 27
Investment Adviser......................................................... 28
Administrative Services.................................................... 29
Distributor................................................................ 30
Portfolio Transactions..................................................... 30
General Information........................................................ 31
UAM Funds -- Institutional Service Class Shares............................ 33
</TABLE>
<PAGE>
UAM FUNDS FPA CRESCENT PORTFOLIO
INSTITUTIONAL SERVICE CLASS
SHARES
- -------------------------------------------------------------------------------
PROSPECTUS -- July 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as Portfolios),
each of which has different investment objectives and policies. The FPA Cres-
cent Portfolio (the "Portfolio") offers two separate classes of shares: Insti-
tutional Class Shares and Institutional Service Class Shares ("Service Class
Shares"). Shares of each class represent equal, pro rata interests in a Port-
folio and accrue dividends in the same manner except that Service Class Shares
bear fees payable by the class (at the rate of .25% per annum) to financial
institutions for services they provide to the owners of such shares. (See
"SERVICE AND DISTRIBUTION PLANS.") The securities offered in this Prospectus
are Service Class Shares of one diversified, no-load Portfolio of the Fund
managed by First Pacific Advisors, Inc.
FPA CRESCENT PORTFOLIO. The FPA Crescent Portfolio's investment objective is
to provide, through a combination of income and capital appreciation, a total
return consistent with reasonable risk. The Portfolio seeks to achieve its ob-
jective by investing primarily in equity securities (common and preferred
stocks) and fixed income obligations.
There can be no assurance that the Portfolio will achieve its objective.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A Statement of Additional Information ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the
SAI contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRE-SENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Service Class Shares will incur. The Fund does not charge transac-
tion fees. However, transaction fees may be charged if a broker-dealer or
other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees ............................................ 1.00%
12b-1 Fees (Including Shareholder Servicing Fees)*................... 0.25%
Other Expenses....................................................... 0.48%
----
Total Operating Expenses ............................................ 1.73%**
====
</TABLE>
- -----------
* The Service Class Shares may bear service fees of 0.25% of average daily
net assets of the Portfolio. (See "SERVICE AND DISTRIBUTION PLANS.") Long-
term shareholders may pay more than the economic equivalent of the maximum
front-end sales charge permitted by rules of the National Association of
Securities Dealers, Inc.
** The Adviser has voluntarily agreed to waive all or a portion of its advi-
sory fees and to assume operating expenses to keep the Portfolio's Service
Class Shares' total annual operating expenses (excluding interest, taxes
and extraordinary expenses), after the effect of expense offsets, from ex-
ceeding 2.10% of average daily net assets until further notice. The fig-
ures above include the effect of expense offsets. If expense offsets were
excluded, Total Operating Expenses of the Portfolio would not be affected.
The Adviser may change or discontinue its fee waivers and expense assump-
tions at any time.
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The fees and expenses set forth above are based upon the
Portfolio's Service Class Shares' operations during the fiscal year ended
March 31, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
FPA Crescent Portfolio
Service Class Shares....................... $18 $54 $94 $204
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
First Pacific Advisors, Inc. (the "Adviser") acts as the Portfolio's Adviser
and has its origins dating back to 1954. It currently has over $4.5 billion in
assets under management. The Adviser is an indirect wholly-owned subsidiary of
United Asset Management Corporation ("UAM"). (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $1,000. Certain
exceptions to the initial or minimum investment amounts may be permitted by
the officers of the Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in the form of dividends in June and December. Any realized net
capital gains will be distributed annually or more often. Distributions will
be reinvested in the Portfolio's shares automatically unless an investor
elects to receive cash distributions. (See "DIVIDENDS, CAPITAL GAINS DISTRIBU-
TIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administration, fund accounting, divi-
dend disbursing and transfer agency services provided to the Fund and its
Portfolios by third-party service providers. (See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
Prospective investors should understand that the Portfolio's performance
will be affected by a variety of factors since it invests in both stocks and
fixed-income securities. The value of the Portfolio's investments will vary
from day to day, generally reflecting global market, economic and political
developments; conditions in global and national markets; changes in currency
exchange rates; factors affecting individual stocks in the Portfolio; and
shifts in interest rates.
. The Portfolio may invest significantly in lower rated fixed-income secu-
rities, which typically offer higher coupon interest rates than invest-
ment grade securities, but also involve greater risks of default and
market volatility. Such securities are sometimes referred to as "junk
bonds" and are considered speculative by rating agencies.
. The Portfolio may engage in short sales of securities, which involve the
risk of loss if the securities increase in price between the time the
Portfolio sells them short and repurchases them.
. The Portfolio may invest in repurchase agreements which entail a risk of
loss should the seller default on its transaction.
. The Portfolio may lend its investment securities which entails a risk of
loss should a borrower fail financially.
. The Portfolio may purchase securities on a when-issued basis which do
not earn interest until issued and may decline or appreciate in market
value prior to their delivery to the Portfolio.
. The Portfolio may engage in various hedging, currency and related strat-
egies to seek to hedge its investments against movements in security
prices, interest rates, and exchange rates by the use of derivatives,
including forward contracts, options and futures as well as options on
futures. These strategies involve the risk of imperfect correlation in
movements in the price of options and futures and movements in the price
of securities, interest rates or currencies which are the subject of the
hedge. These transactions are also subject to the risk factors associ-
ated with foreign investments generally. There can be no assurance that
a liquid secondary market for these hedging techniques will exist at any
specific time. The use of derivatives, if employed incorrectly, may ad-
versely affect the Portfolio.
Further information about each of the above risk factors and others is con-
tained in the "OTHER INVESTMENT POLICIES" section of this Prospectus.
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented of the Portfolio. The table is part
of the Portfolio's Annual Financial Statements, which are included in the
Portfolio's 1998 Annual Report to Shareholders. The Report is incorporated by
reference into the Portfolio's SAI. The Portfolio's Annual Financial State-
ments have been audited by PricewaterhouseCoopers LLP whose unqualified opin-
ion thereon is also incorporated into the Portfolio's SAI. This information
should be read in conjunction with the Portfolio's 1998 Annual Report. Further
information about the Portfolio's performance is contained in its Annual Re-
port, which may be obtained without charge by telephoning the number on the
Prospectus cover page.
<TABLE>
<CAPTION>
JANUARY 24, 1997+
YEAR ENDED TO
MARCH 31, 1998++ MARCH 31, 1997
---------------- -----------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD....... $ 13.43 $ 13.12
------- -------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income..................... 0.53 0.03
Net Realized and Unrealized Gain on
Investments............................. 2.84 0.28
------- -------
Total from Investment Operations......... 3.37 0.31
------- -------
DISTRIBUTIONS:
Net Investment Income..................... (0.39) --
Net Realized Gain......................... (0.26) --
------- -------
Total Distributions...................... (0.65) --
------- -------
NET ASSET VALUE, END OF PERIOD............. $ 16.15 $ 13.43
======= =======
TOTAL RETURN............................... 25.55% 2.36%**
======= =======
Ratios and Supplemental Data
Net Assets, End of Period (Thousands)...... $18,900 $ 32
Ratio of Expenses to Average Net Assets.... 1.73% 1.85%*
Ratio of Net Investment Income to Average
Net Assets............................... 3.44% 2.56%*
Portfolio Turnover Rate.................... 18% 45%*
Average Commission Rate Paid............... $0.0564 $0.0521
</TABLE>
- -----------
* Annualized.
** Not Annualized.
+ Commencement of Operations.
++ Per share amounts for the year ended March 31, 1998 are based on average
outstanding shares.
5
<PAGE>
INVESTMENT OBJECTIVE
The investment objective of the Portfolio is to provide, through a combina-
tion of income and capital appreciation, a total return consistent with rea-
sonable investment risk. The Portfolio seeks to achieve its objective by in-
vesting in a combination of equity securities and fixed-income obligations.
There is, of course, no assurance that the Portfolio's objective will be
achieved. Because prices of common stocks and fixed-income securities fluctu-
ate, the value of an investment in the Portfolio will vary, as the market
value of its investment portfolio changes.
The Portfolio actively seeks value in all parts of a company's capital
structure, including common and preferred stocks, as well as corporate and
convertible bonds. The Portfolio will typically have between 50% and 70% of
its total assets invested in equity securities with the balance comprised of
fixed-income securities and cash and equivalents.
INVESTMENT POLICIES
EQUITY SECURITIES
The Adviser utilizes a contrarian investment style, which often leads the
Adviser to invest in "what other people do not wish to own." The Adviser
searches for common stocks, preferred stocks, warrants and convertible securi-
ties that reflect low price/earnings ratios (P/Es) and trade at discounts to
private market value.
The Adviser selects equity securities for the Portfolio which it believes
offer superior investment value. The Adviser deems the following important in
its stock selection process:
.High return on capital
.Solid balance sheet
.Meaningful cash flow
.Active share repurchase program
.Insider buying
.Superior management seeking to maximize shareholder value
.Projected earnings growth exceeding the stock market average
In the Adviser's view, the stock market prices securities efficiently in the
long term, rewarding companies which successfully grow their earnings and pe-
nalizing those which do not. The Adviser's investment philosophy is based on
the conviction that the market valuation of securities is often inefficient in
the short-term. When reacting to current economic or company information, in-
vestors frequently make purchase or sale decisions hastily. These decisions
could cause a particular security, industry group or the entire market to be-
come underpriced or overpriced in the short-term thereby creating an excellent
opportunity to either buy or sell.
6
<PAGE>
This contrarian style leads to those investments that offer absolute value,
rather than relative value. Absolute value is an investment that trades at
substantial discount to private market value, rather than one that might ap-
pear inexpensive based on a discount to its peer group or the market average.
Attention is directed toward those companies offering the best combination of
such quality criteria as strong market share, good management and high normal-
ized return on capital. A company purchased might not look inexpensive, con-
sidering current earnings and return on capital; however, this may reflect
such conditions as a weak economy, an increase in their raw material costs,
poor management, or any number of other temporary considerations. The price
drops caused by such developments can and often do provide buying opportuni-
ties.
Intensive research identifies these opportunities. The process includes
looking for ideas by reviewing stock price or industry group under-perfor-
mance, insider purchases, management changes and corporate spin-offs. Funda-
mental analysis is the foundation of the Adviser's investment approach. Re-
searching a prospective investment involves communicating directly with com-
pany management, suppliers, and customers, better defining future potential,
financial strength and the company's competitive position. Fundamental analy-
sis provides a thorough view of financial and business characteristics, al-
lowing for the determination of absolute value.
In addition to common stocks, equity securities purchased for the Portfolio
may include preferred stocks, convertible preferred stocks and warrants.
FIXED-INCOME OBLIGATIONS
Through fixed-income investments, the Adviser seeks a reliable and recurring
stream of income for the Portfolio, while preserving its capital. The Adviser
attempts to identify the current interest rate trends and invests funds ac-
cordingly. Usually, a defensive interest rate strategy is employed, with in-
vestments made at different points along the yield curve in an attempt to keep
the average maturity of fixed-income investments less than or equal to ten
years.
The Adviser's approach is to invest in U.S. Treasury obligations, U.S. Gov-
ernment Agency and mortgage-backed securities, and corporate and convertible
bonds. The Adviser considers yield spread relationships and their underlying
factors such as credit quality, investor perception and liquidity on a contin-
uous basis to determine which sector offers the best investment value. When
combined with equity securities, the ownership of fixed-income securities not
only broadens the universe of opportunities, but offers additional diversifi-
cation and can help lower portfolio volatility.
The Adviser may invest in corporate bonds with yields substantially higher
than those of government securities. Opportunities frequently present them-
selves
7
<PAGE>
in parts of the capital structure of a company beyond common and preferred
stock, including convertible and high yield bonds. Generally, these invest-
ments provide a return in excess of government securities and can provide po-
tential for capital appreciation. Historic returns for high yield bonds have
been greater than government securities. The Adviser's analysis includes
studying interest expense coverage, business value/debt coverage and current
business trends.
The Portfolio may purchase investment-grade corporate debt securities. Secu-
rities rated BBB by Standard & Poor's Ratings Services ("S&P") or Moody's In-
vestors Service ("Moody's") are investment grade, but Moody's considers secu-
rities rated Baa to have speculative characteristics. Changes in economic con-
ditions or other circumstances are more likely to lead to a weakened capacity
for such securities to make principal and interest payments than is the case
for higher-rated debt securities.
OTHER INVESTMENT POLICIES
LOWER RATED SECURITIES
The Portfolio may invest in debt securities that are rated below investment
grade, but will limit that investment to no more than 30% of its total assets.
Such securities, sometimes referred to as "junk bonds," typically carry higher
coupon rates than investment grade securities but also involve higher risks
and are described as speculative by both Moody's and S&P. They may be subject
to greater market price fluctuations, less liquidity, and greater risk of in-
come or principal, including a greater possibility of default or bankruptcy of
the issuer of such securities, than are more highly rated debt securities.
Lower rated fixed income securities also are likely to be more sensitive to
adverse economic or company developments and more subject to price fluctua-
tions in response to changes in interest rates. The market for lower-rated
debt issues generally is thinner and less active than that for higher quality
securities, which may limit the Portfolio's ability to sell such securities at
fair value in response to changes in the economy or financial markets.
The Adviser seeks to reduce the risk associated with investing in such secu-
rities by limiting the Portfolio's holdings in such securities and by the
depth of its own credit analysis. In selecting below investment grade securi-
ties, the Adviser seeks securities in companies with improving cash flows and
balance sheet prospects, whose credit ratings the Adviser views as likely to
be upgraded. The Adviser believes that such securities can produce returns
similar to equities, but with less risk. See the SAI for further discussion of
lower rated securities.
REPURCHASE AGREEMENTS
The Portfolio may enter into repurchase agreements in order to earn addi-
tional income on available cash, or as a defensive investment in periods when
the Portfolio is primarily in short-term maturities. A repurchase agreement is
a short-term
8
<PAGE>
investment in which the purchaser (i.e., the Portfolio) acquires ownership of
a security (which may be of any maturity) and the seller agrees to repurchase
that obligation at a future time at a set price, thereby determining the yield
during the purchaser's holding period (usually not more than seven days from
the date of purchase). Any repurchase transaction in which the Portfolio en-
gages will require full collateralization of the seller's obligation during
the entire term of the repurchase agreement. In the event of a bankruptcy or
other default of the seller, the Portfolio could experience both delays in
liquidating the underlying security and losses in value. However, the Portfo-
lio intends to enter into repurchase agreements only with banks with assets of
$500 million or more that are insured by the Federal Deposit Insurance Corpo-
ration and the most creditworthy registered securities dealers pursuant to
procedures adopted and regularly reviewed by the Fund's Board of Trustees. The
Adviser monitors the creditworthiness of the banks and securities dealers with
whom the Portfolio engages in repurchase transactions. The Fund has received
permission from the SEC to pool daily uninvested cash balances of the Fund's
Portfolios in order to invest in repurchase agreements on a joint basis. By
entering into joint repurchase agreements, the Portfolio may incur lower
transaction costs and earn higher rates of interest on joint repurchase agree-
ments. The Portfolio's contribution would determine its return from a joint
repurchase agreement.
ILLIQUID AND RESTRICTED SECURITIES
The Portfolio may not invest more than 15% of its net assets in illiquid se-
curities, including (i) securities for which there is no readily available
market; (ii) securities the disposition of which would be subject to legal re-
strictions (so-called "restricted securities"); and (iii) repurchase agree-
ments having more than seven days to maturity. A considerable period of time
may elapse between the Portfolio's decision to dispose of such securities and
the time when the Portfolio is able to dispose of them, during which time the
value of the securities could decline. Restricted securities do not include
those which meet the requirements of Securities Act Rule 144A and which the
Trustees have determined to be liquid based on the applicable trading markets.
FOREIGN SECURITIES
The Portfolio may invest up to 20% of its total assets in securities of for-
eign issuers. The Adviser usually buys securities of larger foreign companies
that have well recognized franchises and are selling at a discount to the se-
curities of similar domestic businesses.
There may be less publicly available information about these issuers than is
available about companies in the U.S. and foreign auditing requirements may
not be comparable to those in the U.S. In addition, the value of the foreign
securities
9
<PAGE>
may be adversely affected by movements in the exchange rates between foreign
currencies and the U.S. dollar, as well as other political and economic devel-
opments, including the possibility of expropriation, confiscatory taxation,
exchange controls or other foreign governmental restrictions. The Portfolio
may also invest without limit in securities of foreign issuers which are
listed on a domestic national securities exchange. Additionally, there may be
difficulty in obtaining and enforcing judgments against foreign issuers.
SHORT SALES
The Portfolio may engage in short sales of securities. In a short sale, the
Portfolio sells stock which it does not own, making delivery with securities
"borrowed" from a broker. The Portfolio is then obligated to replace the secu-
rity borrowed by purchasing it at the market price at the time of replacement.
This price may or may not be less than the price at which the security was
sold by the Portfolio. Until the security is replaced, the Portfolio is re-
quired to pay to the lender any dividends or interest which accrue during the
period of the loan. In order to borrow the security, the Portfolio may also
have to pay a fee which would increase the cost of the security sold. The pro-
ceeds of the short sale will be retained by the broker, to the extent neces-
sary to meet margin requirements, until the short position is closed out.
The Portfolio also must deposit in a segregated account an amount of cash or
liquid assets equal to the difference between (a) the market value of the se-
curities sold short at the time they were sold short and (b) the value of the
collateral deposited with the broker in connection with the short sale (not
including the proceeds from the short sale). While the short position is open,
the Portfolio must maintain daily the segregated account at such a level that
(1) the amount deposited in it plus the amount deposited with the broker as
collateral equals the current market value of the securities sold short and
(2) the amount deposited in it plus the amount deposited with the broker as
collateral is not less than the market value of the securities at the time
they were sold short.
The Portfolio will incur a loss as a result of the short sale if the price
of the security increases between the date of the short sale and date on which
the Portfolio replaces the borrowed security. The Portfolio will realize a
gain if the security declines in price between those dates. The amount of any
gain will be decreased and the amount of any loss will be increased by any in-
terest the Portfolio may be required to pay in connection with the short sale.
The dollar amount of short sales at any one time (not including short sales
against the box) may not exceed 25% of the net assets of the Portfolio.
A short sale is "against-the-box" if at all times when the short position is
open the Portfolio owns an equal amount of the securities or securities con-
vertible into, or exchangeable without further consideration for, securities
of the same issue as the securities sold short.
10
<PAGE>
OPTIONS AND FUTURES
The Portfolio may purchase and write call and put options on securities, se-
curities indexes and on foreign currencies, and enter into futures contracts
and use options on futures contracts. The Portfolio may use these techniques
to hedge against changes in interest rates, foreign currency exchange rates or
securities prices or as part of its overall investment strategies. The Portfo-
lio is subject to regulatory limitations on the use of such techniques and is
required to maintain segregated accounts consisting of cash or liquid securi-
ties, (or, as permitted by applicable regulation, enter into certain offset-
ting positions) to cover its obligations under options and futures contracts
to avoid leveraging of the Portfolio.
The Portfolio may buy or sell interest rate futures contracts, options on
interest rate futures contracts and options on debt securities for the purpose
of hedging against changes in the value of securities which the Fund owns or
anticipates purchasing due to anticipated changes in interest rates. The Port-
folio also may engage in currency exchange transactions by means of buying or
selling foreign currency on a spot basis, entering into foreign currency for-
ward contracts, and buying and selling foreign currency options, futures and
options on futures. Foreign currency exchange transactions may be entered into
for the purpose of hedging against foreign currency exchange risk arising from
the Portfolio's investment or anticipated investment in securities denominated
in foreign currencies.
See the SAI for further information regarding characteristics of and risks
involved in the use of these instruments.
U.S. GOVERNMENT SECURITIES
The Portfolio may invest in U.S. Government securities. U.S. Government se-
curities include direct obligations issued by the U.S. Treasury, such as Trea-
sury bills, certificates of indebtedness, notes and bonds. U.S. Government
agencies and instrumentalities that issue or guarantee securities include, but
are not limited to, the Federal National Mortgage Association ("FNMA"), Gov-
ernment National Mortgage Association ("GNMA"), Federal Home Loan Bank, Fed-
eral Financing Bank, and Student Loan Marketing Association.
All Treasury securities are backed by the full faith and credit of the
United States. Obligations of U.S. Government agencies and instrumentalities
may or may not be supported by the full faith and credit of the United States.
Some, such as the Federal Home Loan Bank, are backed by the right of the
agency or instrumentality to borrow from the Treasury. Others, such as securi-
ties issued by the Federal National Mortgage Association, are supported only
by the credit of the instrumen-
11
<PAGE>
tality and not by the Treasury. If the securities are not backed by the full
faith and credit of the United States, the owner of the securities must look
principally to the agency issuing the obligation for repayment and may not be
able to assert a claim against the United States in the event that the agency
or instrumentality does not meet its commitment.
INFLATION-INDEXED BONDS
Inflation-indexed bonds are securities whose principal value is periodically
adjusted to reflect the rate of inflation. Such bonds are generally issued at
an interest rate lower than comparable non-indexed bonds, but are expected to
retain their principal value over time. The interest rate on these bonds is
fixed at issuance, but over the life of the bond this interest may be paid on
an increasing principal value, which has been adjusted for inflation. Infla-
tion indexed-bonds issued by the U.S. Treasury have maturities of ten years,
although it is anticipated that securities with other maturities will be is-
sued in the future. If the periodic adjustment rate measuring inflation falls,
the principal value of inflation-indexed bonds will be adjusted downward, and
consequently the interest payable on these securities (calculated with respect
to a smaller principal amount) will be reduced. Repayment of the original bond
principal upon maturity (as adjusted for inflation) is guaranteed in the case
of U.S. Treasury inflation-indexed bonds, even during a period of deflation.
However, the current market value of the bonds is not guaranteed, and will
fluctuate. Any increase in the principal amount of an inflation-indexed bond
is considered taxable ordinary income, even though investors do not receive
their principal until maturity.
MORTGAGE-BACKED SECURITIES
The Portfolio may invest in mortgage-backed securities. Mortgage-backed se-
curities are collateralized by pools of mortgages assembled for subsequent
sale to investors by various governmental agencies and sponsored organizations
as well as by private issuers. The underlying assets collateralizing the mort-
gage-backed securities may include single-family, multi-family and commercial
properties. The two fundamental forms of mortgage-backed securities are pass-
throughs and collateralized mortgage obligations ("CMOs"). Pass-throughs pro-
duce monthly payments of principal and interest from the underlying mortgages.
CMOs divide the cash flows generated from the underlying mortgages or mortgage
pass-through securities into different segments known as "tranches," which are
then retired sequentially over time in order of priority. The market value and
yield of mortgage-backed securities will fluctuate due to market interest rate
change and prepayment variability of the underlying mortgages. As prepayment
rates on mortgages vary widely, it is difficult to accurately predict the av-
erage maturity of a particular pool of mortgages or tranches of CMOs. Although
mortgage-backed securities may offer higher yields than those available from
other types of securities, they may be less effective
12
<PAGE>
than other types of securities as a means of "locking in" an attractive rate
for an extended period because of the prepayment feature. Prepayment risk has
two important effects. First, like bonds in general, mortgage-backed securi-
ties will generally decline in price when interest rates rise. Second, when
interest rates fall and additional mortgage prepayments must be reinvested at
lower interest rates, a Portfolio's rate of interest income may be reduced.
Mortgage-backed securities in which the Portfolio may invest will either carry
a guarantee from an agency of the U.S. Government or a private issuer of the
timely payment of principal and interest or are suitably structured to be con-
sidered by the Adviser to be of investment grade quality.
PORTFOLIO TURNOVER
In general, the Adviser will not consider the rate of portfolio turnover to
be a limiting factor in determining when or whether to purchase or sell secu-
rities in order to achieve the Portfolio's objective. The table set forth in
"Financial Highlights" presents the Portfolio's historical portfolio turnover
rates. In addition to portfolio trading costs, higher rates of portfolio turn-
over may result in the realization of capital gains. To the extent net short-
term capital gains are realized, any distributions resulting from such gains
are considered ordinary income for federal income tax purposes. See "DIVI-
DENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES" for more information on taxa-
tion.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by S&P or Prime-1 or Prime-2 by
Moody's or if unrated, determined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment
13
<PAGE>
purposes, into one or more joint accounts and to invest the daily balance of
the joint accounts in the following short-term investments: fully collateral-
ized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money market instruments including variable rate demand notes
and other tax-exempt money instruments. By entering into these investments on
a joint basis, the Portfolio may earn a higher rate of return on investments
relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest for cash management purposes the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of the purchase commitments until payment is made. Typically, no income
accrues on securities purchased on a delayed delivery basis prior to the time
delivery of the securities is made although the Portfolio may earn income on
securities it has deposited in a segregated account.
The Portfolio engages in these types of purchases in order to buy securities
that fit with its investment objectives at attractive prices--not to increase
its investment leverage.
Securities purchased on a when-issued basis may decline or appreciate in
market value prior to their actual delivery to the Portfolio.
LENDING OF PORTFOLIO SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan portfolio
securi-
14
<PAGE>
ties to the extent that greater than one-third of its total assets at fair
market value, would be committed to loans. By lending its investment securi-
ties, the Portfolio attempts to increase its income through the receipt of in-
terest on the loan. Any gain or loss in the market price of the securities
loaned that might occur during the term of the loan would be for the account
of the Portfolio. All relevant facts and circumstances, including the credit-
worthiness of the broker, dealer or institution, will be considered by the Ad-
viser in making decisions with respect to the lending of securities, subject
to review by the Fund's Board of Trustees.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by the investment company's Board of Trustees. The Portfolio will
continue to retain any voting rights with respect to the loaned securities. If
a material event occurs affecting an investment on loan, the loan must be
called and the securities voted.
INVESTMENT COMPANIES
As permitted by the 1940 Act, the Portfolio reserves the right to invest up
to 10% of its total assets, calculated at the time of investment, in the secu-
rities of other open-end or closed-end investment companies. No more than 5%
of the investing Portfolio's total assets may be invested in the securities of
any one investment company nor may it acquire more than 3% of the voting secu-
rities of any other investment company. The Portfolio will indirectly bear its
proportionate share of any management fees paid by an investment company in
which it invests in addition to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC for each of its Portfolios to
invest for cash management purposes the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio provided that the investment is
consistent with the Portfolio's investment policies and restrictions. Based
upon the Portfolio's assets invested in the DSI Money Market Portfolio, the
investing Portfolio's adviser will waive its investment advisory fee and any
other fees earned as a result of the Portfolio's investment in the DSI Money
Market Portfolio. The investing Portfolio will bear expenses of the DSI Money
Market Portfolio on the same basis as all of its other shareholders.
The Portfolio has adopted certain investment restrictions, which are de-
scribed fully in the SAI. Like the Portfolio's investment objective, most of
these restrictions are fundamental and may be changed only by a majority vote
of the Portfolio's outstanding shares.
15
<PAGE>
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated Service Agent. (See "VALUATION OF SHARES.") The
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $1,000. Certain exceptions may be permitted by the offi-
cers of the Fund.
The Portfolio issues two classes of shares: Institutional Class and Service
Class. The two classes of shares each represent interests in the same portfo-
lio of investments, have the same rights and are identical in all respects,
except that the Service Class Shares offered by this Prospectus bear share-
holder servicing expenses and distribution plan expenses, and have exclusive
voting rights with respect to the Rule 12b-1 Distribution Plan pursuant to
which the distribution fee may be paid. The two classes have different ex-
change privileges. (See "SHAREHOLDER SERVICES--EXCHANGE PRIVILEGE.") The net
income attributable to Service Class Shares and the dividends payable on Serv-
ice Class Shares will be reduced by the amount of the shareholder servicing
and distribution fees; accordingly, the net asset value of the Service Class
Shares will be reduced by such amounts.
Some Service Agents may also impose additional or different conditions or
other account fees on the purchase and redemption of Portfolio shares, which
are not subject to the Rule 12b-1 Service and Distribution Plans. These may
include transaction fees and/or service fees paid by the Fund from the Fund
assets attributable to the Service Agent and, would not be imposed if shares
of the Portfolio were purchased directly from the Fund or the Distributor.
Service Agents may provide shareholder services to their customers that are
not available to a shareholder dealing directly with the Fund. Each Service
Agent is responsible for transmitting to its customers a schedule of any such
fees and information regarding any additional or different conditions regard-
ing purchases and redemptions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. A salesperson and any other person entitled to receive compen-
sation for selling or servicing Portfolio shares may receive different compen-
sation with respect to one particular class of shares over another in the
Fund.
Service Agents or if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than the
close of regular trading on the New York Stock Exchange ("Exchange") on the
following business day. If payment is not received by the Fund's Sub-Transfer
Agent, Chase Global Funds Services Company ("CGFSC"), by such time, the Serv-
ice Agent could be
16
<PAGE>
held liable for resulting fees or losses. A Portfolio may be deemed to have
received a purchase or redemption order when a Service Agent, or, if applica-
ble, its authorized designee, accepts the order. Orders received by the Fund
in proper form will be priced at the Portfolio's net asset value next computed
after they are accepted by a Service Agent or its authorized designee. Service
Agents are responsible to their customers and the Fund for timely transmission
of all subscription and redemption requests, investment information, documen-
tation and money.
INITIAL INVESTMENTS
BY MAIL
. Complete and sign an Application and mail it together with a check made
payable to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of a Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds."
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the Exchange (generally 4:00 p.m. Eastern Time) to re-
ceive that day's price. An account number and a wire control number will
then be provided to you in addition to wiring instructions. Next,
17
<PAGE>
. Instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name _______
Your Account Number _______
Your Account Name _______
Wire Control Number _______
(assigned by UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the Exchange and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investors bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
18
<PAGE>
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the Exchange (gener-
ally 4:00 p.m. Eastern Time) will be invested at the share price calculated
after the Exchange closes on that day. Investments received after the close of
the Exchange will be executed at the price computed on the next day the Ex-
change is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be a long-term investment vehicle and is
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lio's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon
19
<PAGE>
their sale by the Portfolio under the Securities Act of 1933, or
otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of the shares depending
on the market value of investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
20
<PAGE>
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent do not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of
21
<PAGE>
up to fifteen days after their purchase, pending determination that the check
has cleared. Investors should consider purchasing shares using a certified or
bank check or money order if they anticipate an immediate need for redemption
proceeds. The Fund may suspend the right of redemption or postpone the date at
times when both the Exchange and Custodian Bank are closed, or under any emer-
gency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by a Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SERVICE AND DISTRIBUTION PLANS
Under the Service Plan for Service Class Shares, the Fund may enter into
service agreements with Service Agents (broker-dealers or other financial in-
stitutions) who receive fees with respect to the Fund's Service Class Shares
owned by shareholders for whom the Service Agent is the dealer or holder of
record, or for whom the Service Agent performs personal services and/or share-
holder account maintenance. These fees are paid out of the assets allocable to
Service Class Shares to the Distributor, to the Service Agent directly or
through the Distributor. The Fund reimburses the Distributor or the Service
Agent for payments made at an annual rate of up to 0.25 of 1% of the average
daily value of Service Class Shares. Each item for which a payment may be made
under the Service Plan constitutes personal service and/or shareholder account
maintenance and may constitute an expense of distributing Fund shares as the
SEC construes such term under Rule 12b-1. The fees payable for servicing re-
flect actual expenses incurred up to the limits described herein.
Banks are engaged to act as Service Agents only to perform administrative
and shareholder servicing functions, including transaction-related agency
services
22
<PAGE>
for their customers. If a bank is prohibited from acting as a service agent,
alternative means for continuing the servicing of its shareholders would be
sought and the shareholder clients of the bank would remain Fund shareholders.
The Distribution Plan and Service Plan (the "Plans") provide generally that
a Portfolio may incur distribution and service costs under the Plans which may
not exceed in the aggregate 0.75% per annum of that Portfolio's net assets.
The Board has currently limited aggregate payments under the Plans to 0.50%
per annum of a Portfolio's net assets. Upon implementation, the Distribution
Plan would permit payments to the Distributor, broker-dealers, other financial
institutions, sales representatives or other third parties who render promo-
tional and distribution services, for items such as sales compensation and
marketing and overhead expenses.
The Plans were adopted pursuant to Rule 12b-1 under the 1940 Act. Although
the Plans may be amended by the Board of Trustees, any changes in the Plans
which would materially increase the amounts authorized to be paid under the
Plans must be approved by shareholders of the Class involved. The Plans may be
terminated by the Board of Trustees or Service Class shareholders. The amounts
and purposes of expenditures under the Plans are reported to the Board of
Trustees quarterly. The amounts allowable under the Plans for the Service
Class of Shares of the Portfolios are limited by the terms of such Plan and
under certain rules of the National Association of Securities Dealers, Inc.
In addition to payments by the Fund under the Plans, the Distributor, United
Asset Management Corporation, the parent company of UAMFSI, and of the Adviser
or any of their affiliates, may, at its own expense, compensate a Service
Agent or other person for marketing, shareholder servicing, recordkeeping
and/or other services performed with respect to the Fund, the Portfolio or any
Class of Shares of the Portfolio. The person making such payments may do so
out of its revenues, its profits or any other source available to it. Such
service arrangements, when in effect, are made generally available to all
qualified service providers. The Adviser may compensate its affiliated compa-
nies for referring investors to the Portfolio.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and shareholder services and receives from such entities an amount
equal to up to 33.3% of the portion of the investment advisory fees attribut-
able to the invested assets of Smith Barney's eligible customer accounts with-
out regard to any expense limitation in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by UAMFSI.
23
<PAGE>
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Service Class Shares of the Portfolio may be exchanged for Service Class
Shares of any other UAM Funds Portfolio. (See the list of Portfolios of the
UAM Funds at the end of this Prospectus.) Exchange requests should be made by
contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the Exchange (generally 4:00 p.m. Eastern Time)
will be processed as of the close of business on the same day. Requests re-
ceived after the close of regular trading on the Exchange will be processed on
the next business day. The Fund may modify or terminate the exchange program
at any time upon 60 days' written notice to shareholders, and may reject any
exchange request. If the Fund's management determines that an investor is en-
gaged in excessive trading, the Fund, with or without prior notice may reject
in whole or part any exchange request, with respect to such investor's ac-
count. Such investors also may be barred from exchanging into other portfolios
of the UAM Funds. For additional information regarding responsibility for the
authenticity of telephoned instructions, see "REDEMPTION OF SHARES--BY TELE-
PHONE". An exchange into another UAM Funds Portfolio is a sale of shares and
may result in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or by pre-authorized checks or
drafts drawn on
24
<PAGE>
the shareholder's bank or other account. The bank or financial institution
must be a member of ACH. At the shareholder's option, the account designated
will be debited in the specified amount, and shares will be purchased monthly
or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the value of
the Portfolio's shares fluctuate, the number of shares redeemed to finance
systematic withdrawal payments or a given amount will vary from payment to
payment. If a shareholder owns shares in more than one Portfolio, the share-
holder must designate the Portfolio from which the redemptions under a System-
atic Withdrawal Plan should be made. An additional sheet may be attached to
the Optional Services Form if a shareholder selects more than one Portfolio. A
Systematic Withdrawal Plan may be terminated or suspended at any time by the
Fund. A shareholder may elect at any time, in writing, to terminate participa-
tion in the Systematic Withdrawal Plan. Such written election must be sent to
and received by the Fund before a termination becomes effective. There is cur-
rently no charge to the shareholder for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the Exchange on each day that the Exchange is open
for business.
25
<PAGE>
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date are valued neither exceeding the cur-
rent ask prices nor less than the current bid prices. The prices for securi-
ties denominated in a foreign currency are converted to U.S. dollars based
upon the bid price of the foreign currency against U.S. dollars quoted by any
major bank or by a broker.
Bonds and other fixed-income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed-income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Board of Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of the Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount,
26
<PAGE>
except that service and distribution fees and any incremental transfer agency
costs relating to Service Class Shares will be borne exclusively by that
class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. To
receive an Annual Report, contact the UAM Funds Service Center at the address
or telephone number on the cover of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in dividends in June and Decem-
ber. If any net capital gains are realized, the Portfolio will normally dis-
tribute them in June, with a supplemental distribution in December of any un-
distributed capital gains earned during the 12 month period ended each Octo-
ber. All dividends and capital gains distributions will be automatically rein-
vested in additional shares of the Portfolio unless the Fund is notified in
writing that the shareholder elects to receive the distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends and distributions. To do this,
the Portfolio must, among other things, distribute substantially all of its
ordinary income and net capital gains on an annual basis and maintain a port-
folio of investments which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of the tax status of dividends and capital gain distribu-
tions received.
27
<PAGE>
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that the Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
First Pacific Advisors, Inc., located at 11400 West Olympic Blvd., Suite
1200, Los Angeles, CA 90064, acts as the Portfolio's Adviser; Mr. Steven
Romick is primarily responsible for management of the Portfolio. Mr. Romick
has 13 years of experience in the investment management business. He is cur-
rently a Senior Vice President of the Adviser. From 1990-1996, Mr. Romick was
Chairman of Crescent Management, an investment advisory firm he founded. Cres-
cent Management served as the Portfolio's adviser until the firm was merged
with the current Adviser.
Under an Investment Advisory Agreement dated as of September 30, 1996, the
Adviser provides the Portfolio with advice on buying and selling securities,
manages the investments of the Portfolio, furnishes the Portfolio with office
space and certain administrative services, and provides most of the personnel
needed by the Portfolio. As compensation, the Portfolio pays the Adviser a
monthly management fee (accrued daily) based upon the average daily net assets
of the Portfolio at the rate of 1.00% annually.
The Adviser, together with its predecessors, has been in the investment ad-
visory business since 1954. Presently, the Adviser manages assets of approxi-
mately $4.5 billion for seven investment companies, including one closed-end
investment company, and more than 25 institutional accounts. The Adviser is an
indirect wholly-owned subsidiary of UAM, an Exchange-listed holding company
principally en-
28
<PAGE>
gaged, through affiliated firms, in providing institutional investment manage-
ment and acquiring institutional investment management firms.
The Portfolio is responsible for its own operating expenses. The Adviser has
voluntarily agreed to waive all or a portion of its advisory fees and to as-
sume operating expenses to keep the Portfolio's Service Class Shares' total
annual operating expenses (excluding interest, taxes and extraordinary ex-
penses), after the effect of expense offsets, from exceeding 2.10% of average
daily net assets until further notice. To the extent the Adviser performs a
service for which the Portfolio is obligated to pay, the Portfolio shall reim-
burse the Adviser for its costs incurred in rendering such service.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of its affiliates,
may, at their own expense, compensate a Service Agent or other person for mar-
keting, shareholder servicing, recordkeeping and/or other services performed
with respect to the Fund, the Portfolio or any Class of Shares of the Portfo-
lio. The person making such payments may do so out of its revenues, its prof-
its or any other source available to it. Such service arrangements, when in
effect, are made generally available to all qualified service providers.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and other shareholder services and receives from such entities .15 of
1% of the daily net asset value of Institutional Class Shares held by Smith
Barney's eligible customer accounts in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services its pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by the Administrator.
ADMINISTRATIVE SERVICES
UAMFSI, a wholly-owned subsidiary of UAM, is responsible for performing and
overseeing administrative, fund accounting, dividend disbursing and transfer
agent services provided to the Fund and its Portfolios. UAMFSI's principal of-
fice is located at 211 Congress Street, Boston, MA 02110. UAMFSI has subcon-
tracted some of these services to CGFSC, an affiliate of The Chase Manhattan
Bank, by a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is lo-
cated at 73 Tremont Street, Boston, MA 02108.
29
<PAGE>
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
FPA Crescent Portfolio............................................... 0.06%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, with its
principal office located at 211 Congress Street, Boston, MA 02110, distributes
shares of the Fund. Under the Distribution Agreement (the "Agreement"), the
Distributor, as agent of the Fund, agrees to use its best efforts as sole dis-
tributor of Fund shares. The Distributor does not receive any fee or other
compensation under the Agreement with respect to the Shares offered in this
Prospectus (except as described under "SERVICE AND DISTRIBUTION PLANS"). The
Agreement continues in effect as long as it is approved at least annually by
the Fund's Board of Trustees. Those approving the Agreement must include a ma-
jority of Trustees who are neither parties to the Agreement nor interested
persons of any such party. The Agreement provides that the Fund will bear
costs of registration of its shares with the SEC and various states and the
printing of its prospectuses, its SAIs and its reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of
30
<PAGE>
the research, statistical and pricing services they provide to the Portfolio
in addition to required services. Such brokers may be paid a higher commission
than that which another qualified broker would have charged for effecting the
same transaction, provided that such commissions are paid in compliance with
the Securities Exchange Act of 1934, as amended, and that the Adviser deter-
mines in good faith that such commission is reasonable in terms either of the
transaction or the overall responsibility of the Adviser to the Portfolio and
the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same, transactions in such securities will be
allocated among the Portfolio and other clients in a manner deemed fair and
reasonable by the Adviser. Although there is no specified formula for allocat-
ing such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees, if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Charles Schwab & Co. Inc., Reinvest Account, held of
record 48.8% of the outstanding shares of the Portfolio's Institutional Class
and Wilmington Trust Co., Trustee, FBO FIGGIE Institutional Retirement &
Profit Sharing Trust, held of record 41.5% of the outstanding shares of the
Portfolio's Service Class for which beneficial ownership is disclaimed or pre-
sumed disclaimed. The persons or organizations owning 25% or more of the out-
standing shares of a Portfolio may be presumed to "control" (as that term is
defined in the
31
<PAGE>
1940 Act) such Portfolio. As a result, those persons or organizations could
have the ability to vote a majority of the shares of the Portfolio on any mat-
ter requiring the approval of shareholders of such Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of the Portfolio. Service Class Shares bear certain expenses
related to shareholder servicing and the distribution of such shares and have
exclusive voting rights for matters relating to such distribution expendi-
tures. The Board of Trustees of the Fund has authorized a third class of
shares, Advisor Shares, which is not currently being offered by this Portfo-
lio. For information about the Institutional Class Shares of the Portfolio,
contact the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR IN THE PORTFOLIO'S
STATEMENT OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY
THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH
OFFERING MAY NOT BE LAWFULLY MADE.
32
<PAGE>
UAM FUNDS -- INSTITUTIONAL SERVICE CLASS SHARES
BHM&S Total Return Bond Portfolio
DSI Disciplined Value Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TJ Core Equity Portfolio
33
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
First Pacific Advisors, Inc.
11400 West Olympic Boulevard
Suite 1200
Los Angeles, CA 90064
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
Hanson Equity Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 2
Risk Factors............................................................... 3
Financial Highlights....................................................... 3
Investment Objective....................................................... 4
Investment Policies........................................................ 4
Other Investment Policies.................................................. 5
Investment Limitations..................................................... 9
Purchase of Shares......................................................... 9
Redemption of Shares....................................................... 13
Shareholder Services....................................................... 15
Valuation of Shares........................................................ 17
Performance Calculations................................................... 18
Dividends, Capital Gains Distributions and Taxes........................... 18
Investment Adviser......................................................... 19
Adviser's Historical Performance........................................... 21
Administrative Services.................................................... 24
Distributor................................................................ 24
Portfolio Transactions..................................................... 25
General Information........................................................ 25
UAM Funds -- Institutional Class Shares.................................... 27
</TABLE>
<PAGE>
UAM FUNDS HANSON EQUITY PORTFOLIO
INSTITUTIONAL CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
Hanson Equity Portfolio is one of a series of investment portfolios available
through UAM Funds Trust ("UAM Funds"), an open-end investment company known as
a "mutual fund." Each of the Portfolios that make up the Fund have different
investment objectives and policies. Hanson Equity Portfolio currently offers
only one class of shares. The securities offered in this Prospectus are Insti-
tutional Class Shares of one diversified, no-load Portfolio of the Fund managed
by Hanson Investment Management Company.
HANSON EQUITY PORTFOLIO. The Hanson Equity Portfolio (the "Portfolio") seeks
to achieve maximum long-term total return, consistent with reasonable risk to
principal, by investing in a diversified portfolio of equity securities, pri-
marily the common stock of large, U.S.-based companies with outstanding finan-
cial characteristics and strong growth prospects that can be purchased at rea-
sonable valuations.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A Statement of Additional Information ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction fees. However, transaction fees may be charged if a broker-dealer
or other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees.............................................. 0.70%
12b-1 Fees............................................................ NONE
Other Expenses........................................................ 0.69%
----
Total Operating Expenses.............................................. 1.39%*
====
</TABLE>
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The expenses and fees set forth above for the Portfolio
are estimates. For purposes of calculating the fees set forth above, the table
assumes that the Portfolio's average daily net assets will be $21 million.
*The figures above include the effect of expense offsets. If expense offsets
were excluded, Total Operating Expenses of the Portfolio would not be affected.
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Hanson Equity Portfolio...................... $14 $44 $76 $167
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
1
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Hanson Investment Management Company (the "Adviser") is a registered invest-
ment adviser. Founded in 1973, the firm currently has over $1.1 billion in as-
sets under management. The firm is a wholly-owned subsidiary of United Asset
Management Corporation. (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in Portfolio
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
2
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Prospective investors
should consider the following: (1) The Portfolio may invest in repurchase
agreements which entail a risk of loss should the seller default on its trans-
action; (2) The Portfolio may lend its investment securities which entails a
risk of loss should a borrower fail financially; (3) The Portfolio's perfor-
mance may depend on the ability of the Adviser who has substantial experience
as an investment adviser but limited experience as an adviser to a mutual
fund.
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented. This table is part of the Portfo-
lio's Annual Financial Statements included in the Portfolio's 1998 Annual Re-
port to Shareholders. The Report is incorporated by reference into the Portfo-
lio's SAI. The Portfolio's Annual Financial Statements have been audited by
PricewaterhouseCoopers LLP whose unqualified opinion thereon is also incorpo-
rated into the Portfolio's SAI. The following information should be read in
conjunction with the Portfolio's 1998 Annual Report to Shareholders. Further
information about the Portfolio's performance is contained in its Annual Re-
port, which may be obtained without charge by telephoning the number on the
Prospectus cover page.
<TABLE>
<CAPTION>
OCTOBER 3, 1997*
TO APRIL 30, 1998
-----------------
<S> <C>
NET ASSET VALUE, BEGINNING OF PERIOD......................... $ 10.00
-------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Loss......................................... (0.02)
Net Realized and Unrealized Gain on Investments............. 1.40
-------
Total from Investment Operations........................... 1.38
-------
NET ASSET VALUE, END OF PERIOD............................... $ 11.38
=======
TOTAL RETURN................................................. 13.80 %***
=======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (Thousands)....................... $25,690
Ratio of Expenses to Average Net Assets..................... 1.56 %**
Ratio of Net Investment Loss to Average Net Assets.......... (0.35)%**
Portfolio Turnover Rate..................................... 11 %
Average Commission Rate..................................... $0.0598
Ratio of Expenses to Average Net Assets including Expense
Offsets................................................... 1.56 %**
</TABLE>
- -----------
* Commencement of Operations
** Annualized
*** Not Annualized
3
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks to achieve maximum long-term total return, consistent
with reasonable risk to principal, by investing in a diversified portfolio of
equity securities, primarily the common stock of large, U.S.-based companies
with outstanding financial characteristics and strong growth prospects that
can be purchased at reasonable valuations. There can be no assurance that the
Portfolio will achieve its stated objective.
INVESTMENT POLICIES
In seeking its investment objective, the Portfolio will, under normal cir-
cumstances, invest at least 80% of its total assets in equity securities, pri-
marily the common stock of large capitalization, U.S.-based companies. Large
capitalization companies are defined as those companies with market capital-
izations greater than $1 billion at the time of purchase. Equity securities
include common stock, preferred stock, rights and warrants. The Portfolio may
also invest in short-term investments, convertible preferred stock and con-
vertible bonds.
Under unusual circumstances, when the Adviser believes that market condi-
tions warrant a defensive position, up to 100% of the Portfolio's assets may
be held in cash and short-term investments. (See "SHORT-TERM INVESTMENTS" and
"REPURCHASE AGREEMENTS.") When the Portfolio is in a defensive position, it
may not necessarily be pursuing its stated investment objective.
The basis of the Adviser's investment philosophy is to "buy the company, not
the stock." The Adviser believes that superior long-term results can be
achieved by investing in a select number of well-managed companies that have
clear business plans, specific financial goals, above-average earnings and
dividend growth rates, and whose shares can be purchased at reasonable valua-
tions. The Adviser's stock selection process is a bottom-up approach which
means that it will construct the Portfolio by focusing on individual stocks
rather than industry groups or sectors. (Top-down investors would first decide
which industries or sectors they want to emphasize and then would look for
stocks that fit those requirements.) In determining a suitable equity invest-
ment, the Adviser evaluates a prospective company using the following process:
1.The Adviser asks three questions:
.Does the Adviser understand the company's business?
.Is the company's management shareholder-conscious?
.Is the company's long-term outlook favorable?
2. The Adviser subjects the company to a screen designed to select companies
with the following characteristics:
.reasonable price-to-earnings ratio
4
<PAGE>
.above-average total return potential
.leader in its industry
.highly profitable
.financially strong
3. Finally, the potential investment is put through an intensive review by
the Investment Committee before it is added to the Portfolio.
The Adviser sells equity investments when: (a) the company fails to meet the
Adviser's investment criteria; (b) a more attractive investment is found; or
(c) the company's share price rises to a level that cannot be justified.
OTHER INVESTMENT POLICIES
Under normal circumstances, the Portfolio may invest up to 20% of its as-
sets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities or investment techniques:
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by Standard & Poor's Ratings
Services or Prime-1 or Prime-2 by Moody's Investors Service or if unrated, de-
termined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term mone y market instruments including variable rate demand
notes and tax-exempt money
5
<PAGE>
instruments. By entering into these investments on a joint basis, the Portfo-
lio may earn a higher rate of return on investments relative to what it could
earn individually.
The Fund has received permission from the SEC for each of its Portfolios
to invest, for cash management purposes, the greater of 5% of its total assets
or $2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT
COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
6
<PAGE>
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolios will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices--not to in-
crease its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The historical turnover rate for the Portfolio is set forth in the "Financial
Highlights" table.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
7
<PAGE>
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
RESTRICTED SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of a
Portfolio's investment limitations. The Portfolio may also invest up to 15% of
its net assets in illiquid securities. Prices realized from sales of these se-
curities could be more or less than those originally paid by the Portfolio or
less than what may be considered the fair value of such securities.
AMERICAN DEPOSITARY RECEIPTS
ADRs are depositary receipts typically used by a U.S. bank or trust company
which evidence ownership of underlying securities issued by a foreign corpora-
tion. Generally, ADRs in registered form are designed for use in the U.S. se-
curities market and ADRs in bearer form are designed for use in securities
markets outside the United States. ADRs may not necessarily be denominated in
the same currency as the underlying securities into which they may be convert-
ed. ADRs may be issued pursuant to sponsored or unsponsored programs. In spon-
sored programs, an issuer has made arrangements to have its securities traded
in the form of depositary receipts. In unsponsored programs, the issuer may
not be directly involved in the creation of the program. Although regulatory
requirements with respect to sponsored and unsponsored programs are generally
similar, in some cases it may be easier to obtain financial information from
an issuer that has participated in the creation of a sponsored program. Ac-
cordingly, there may be less information programs available regarding issuers
of securities underlying unsponsored programs and there may not be a correla-
tion between such information and the market value of the depositary receipts.
ADRs also involve the risks of other investments in foreign securities, as
discussed in the Prospectus. For purposes of the Portfolio's investment poli-
cies, the Portfolio's investment in depositary receipts will be deemed to be
investments in the underlying securities.
8
<PAGE>
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies;
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The Portfolio's investment objective and investment limitations (a), (b),
(d), (e) and (f)(i) listed above are fundamental policies and may be changed
only with the approval of the holders of a majority of the outstanding voting
securities of the Portfolio. The other investment limitations described here
and those not specified as fundamental in the SAI as well as the Portfolio's
investment policies are not fundamental and the Fund's Board of Trustees may
change them without shareholder approval.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated Service Agent. (See "VALUATION OF SHARES.") The
9
<PAGE>
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $500. The minimum initial investment for spousal IRA ac-
counts is $250. Certain exceptions may be permitted by the officers of the
Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemptions of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding additional or different
purchase or redemption conditions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. Amounts paid to Service Agents may include transaction fees
and/or service fees paid by the Fund from the Portfolio's assets attributable
to the Service Agent, which would not be imposed if shares of the Portfolio
were purchased directly from the Fund or the Distributor. Service Agents may
provide shareholder services to their customers that are not available to a
shareholder dealing directly with the Fund. A salesperson and any other person
entitled to receive compensation for selling or servicing Portfolio shares may
receive different compensation with respect to one particular class of shares
over another in the Fund.
Service Agents or, if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by Serv-
ice Agent or its authorized designee. Service Agents are responsible to their
customers and the Fund for timely transmission of all subscription and redemp-
tion requests, investment information, documentation and money.
INITIAL INVESTMENTS
BY MAIL
. Complete and sign an Application and mail it together with a check made
payable to "UAM" Funds to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
10
<PAGE>
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds".
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that day's price. An account number and a wire control number will then
be provided to you in addition to wiring instructions. Next,
. instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name ____________
Your Account Number ____________
Your Account Name _____________
Wire Control Number ____________
(assigned by UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investors bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
11
<PAGE>
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES - AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m., Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be long-term investment vehicles and is not
designed to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases can be disruptive to efficient
portfolio management and, consequently, can be detrimental to a Portfolio's
performance and its shareholders. Accordingly, if the Fund's management deter-
mines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this
12
<PAGE>
Prospectus. Securities to be exchanged which are accepted by the Fund will be
valued as described under "VALUATION OF SHARES" at the next determination of
net asset value after acceptance. Shares issued by the Portfolio in exchange
for securities will be issued at net asset value determined as of the same
time. All dividends, interest, subscription, or other rights pertaining to
such securities shall become the property of the Portfolio and must be deliv-
ered to the Fund by the investor upon receipt from the issuer. Securities ac-
quired through an in-kind purchase will be acquired for investment and not for
immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of the shares depending
on the market value of investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
13
<PAGE>
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent do not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-
14
<PAGE>
dealers guaranteeing signatures must be a member of a clearing corporation or
maintain net capital of at least $100,000. Credit unions must be authorized to
issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center or a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by the Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for the Port-
folio as set forth in the Prospectus, where the reduction in value has oc-
curred due to a redemption or exchange out of the account. If at any time your
total investment does not have a value of at least fifty percent of the re-
quired minimum initial investment amount, you may be notified that the value
of your account is below the Portfolio's minimum account balance requirement.
You would then be allowed 60 days to make an additional investment before the
account is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
15
<PAGE>
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility for the authentic-
ity of telephoned instructions, see "REDEMPTION OF SHARES -- BY TELEPHONE". An
exchange into another UAM Funds Portfolio is a sale of shares and may result
in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or be pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at
1-800-638-7983 and mail it to Chase Global Funds Service Company. A share-
holder may cancel his/her participation or change the amount of purchase at
any time by mailing written notification to Chase Global Funds Services Compa-
ny, P.O. Box 2798, Boston, MA 02208-2798. Notification generally will be ef-
fective
16
<PAGE>
three business days following receipt. The Fund may modify or terminate this
privilege at any time, or may charge a service fee, although no such fee cur-
rently is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any time by the Fund. A share-
holder may elect at any time, in writing, to terminate participation in the
Systematic Withdrawal Plan. Such written election must be sent to and received
by the Fund before a termination becomes effective. There is currently no
charge to the shareholder for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding. The
net asset value per share of the Portfolio is determined as of the close of
the NYSE on each day that the NYSE is open for business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
17
<PAGE>
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end will contain additional performance information that includes compar-
isons with appropriate indices. The Annual Report will be available without
charge. Contact the UAM Funds Service Center at the address or telephone num-
ber on the cover of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, each Portfolio will normally distribute them
annually. All dividends and capital gains distributions will be automatically
reinvested in additional shares of the Portfolio unless the Fund is notified
in writing that the shareholder elects to receive the distributions in cash.
18
<PAGE>
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
Hanson Investment Management Company (the "Adviser") is a registered invest-
ment adviser formed in 1973. Its business offices are located at 4000 Civic
Center Drive, Suite 200, San Rafael, CA 94903. The Adviser is a wholly-owned
subsidiary of United Asset Management Corporation ("UAM") and provides and of-
fers investment management and advisory services to corporations, unions, pen-
sions and profit-sharing plans, trusts, estates and other institutions and in-
vestors. The Adviser currently has over $1.1 billion in assets under manage-
ment.
19
<PAGE>
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 0.70%.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at its own expense, compensate a Service Agent or other person for
marketing, shareholder servicing, recordkeeping and/or other services per-
formed with respect to the Fund, a Portfolio or any Class of Shares. Payments
made for any of these purposes may be made from its revenues, its profits or
any other source available to it. When such service arrangements are in ef-
fect, they are made generally available to all qualified service providers.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and other shareholder services of its consulting group and receives
from such entities .15 of 1% of the daily net asset value of Institutional
Class Shares held by Smith Barney's eligible customer accounts in addition to
amounts payable to all selling dealers. The Fund also compensates Smith Barney
for services it provides to certain defined contribution plan shareholders
that are not otherwise provided by UAMFSI.
The investment professionals at the Adviser who comprise the Investment Com-
mittee and who are responsible for the day-to-day management of the Portfolio
and their qualifications are as follows:
CHARLES H. RAVEN, CHAIRMAN. Charles H. Raven joined Hanson Investment Man-
agement Company in 1983 as a principal of the firm. Prior to joining the firm,
Mr. Raven was a senior portfolio manager for McCullough & Andrews and before
that was Vice President, Investments at Lionel D. Edie & Company where he
worked for fourteen years. Previously, he worked in commercial banking with
Bank of America. He received a BA from Stanford University and an MBA from
Harvard Business School.
DAVID E. POST, CHIEF EXECUTIVE OFFICER AND PORTFOLIO MANAGER. David E. Post
joined Hanson Investment Management Company in 1994 as a portfolio manager.
Mr. Post heads Adviser's Management Committee. Prior to joining HIMCO, Mr.
Post directed the investment of all managed assets at CSI Capital Management,
the investment management firm he founded in 1983. Previously, he served as
president of HS Partners, Inc. He began his career at Merrill Lynch, Pierce,
Fenner & Smith. Mr. Post received a BA from the University of California,
Berkeley.
STEVEN E. CUTCLIFFE, MANAGING DIRECTOR AND PORTFOLIO MANAGER. Steven E.
Cutcliffe joined Hanson Investment Management
20
<PAGE>
Company in 1991 as a portfolio manager. Mr. Cutcliffe is a member of the Man-
agement Committee. Previously, Mr. Cutcliffe was Vice President, Corporate Fi-
nance for McGinn, Smith & Company and before that was an Assistant Secretary
at Manufacturers Hanover Trust Company. He received an AB from Dartmouth Col-
lege and an MBA from Dartmouth's Amos Tuck School.
STEVEN W. ENOS, CFA, VICE PRESIDENT, RESEARCH. Steven W. Enos joined Hanson
Investment Management in 1998. Prior to joining Hanson, Mr. Enos was a Princi-
pal and Vice President of Wells Capital Management. While at Wells, Mr. Enos
managed $1.3 billion in equity funds and was a senior member of Wells Capi-
tal's Growth Stock Team. Prior to joining Wells Fargo, he worked at Dolan Cap-
ital Management where he was a research analyst. Mr. Enos began his investment
career in 1985 with First Interstate Financial Advisors, where he was a port-
folio manager. Mr. Enos is a Chartered Financial Analyst and a member of the
Security Analysts of San Francisco. Mr. Enos received a BS from the University
of California at Davis.
JOHN D. SCHAEFFER, VICE PRESIDENT, RESEARCH. John D. Schaeffer joined Hanson
Investment Management Company in 1997. Prior to joining the Adviser, Mr.
Schaeffer was a research analyst for Barbary Coast Capital, a hedge fund. Pre-
viously, Mr. Schaeffer was a senior analyst at Bridgewater Associates, a quan-
titative investment management firm. Mr. Schaeffer received a BA from Duke
University and an MBA from the University of California, Berkeley.
JASON E. BLATTBERG, RESEARCH ASSOCIATE. Jason E. Blattberg joined Hanson In-
vestment Management in 1998. Prior to joining Hanson, Mr. Blattberg was a mem-
ber of the investment strategy team at Lehman Brothers. Mr. Blattberg received
a BA from the University of Virginia, attended the London School of Economics,
and received an MBA from the Anderson Graduate School of Management at UCLA.
REYNOLD SAMORANOS, VICE PRESIDENT, TRADING AND OPERATIONS. Reynold Samoranos
joined Hanson Investment Management in 1991. In addition to his responsibility
as primary trader, Mr. Samoranos serves Hanson in several other areas, includ-
ing accounting and general staff management. Prior to joining Hanson, Mr.
Samoranos worked for Citibank North America as the regional financial control-
ler. Mr. Samoranos received a BS from the University of California, Berkeley
and an MBA from the University of Chicago.
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to the
composite of separately managed accounts of the Adviser that are managed with
substantially similar (although not necessarily identical) objectives, poli-
cies and strategies as those of the Portfolio. The performance data for the
managed accounts is net of all fees and expenses. The investment returns of
the Portfolio may differ
21
<PAGE>
from those of the separately managed accounts because such separately managed
accounts may have fees and expenses that differ from those of the Portfolio.
Further, the separately managed accounts are not subject to investment limita-
tions, diversification requirements, and other restrictions imposed by the
1940 Act and the Internal Revenue Code; such conditions, if applicable, may
have lowered the returns for the separately managed accounts. The results pre-
sented are not intended to predict or suggest the return to be experienced by
the Portfolio or the return an investor might achieve by investing in the
Portfolio.
22
<PAGE>
HANSON INVESTMENT MANAGEMENT COMPANY COMPOSITE
RETURNS FOR INDIVIDUAL YEARS ENDED DECEMBER 31
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
<TABLE>
<CAPTION>
HANSON INVESTMENT
MANAGEMENT
CALENDAR YEARS COMPANY S & P 500
-------------- ----------------- ----------
<S> <C> <C>
1981........................................... 11.4 % (5.3)%
1982........................................... 26.8 % 21.4 %
1983........................................... 26.9 % 22.6 %
1984........................................... 7.7 % 6.3 %
1985........................................... 33.0 % 31.7 %
1986........................................... 18.8 % 18.7 %
1987........................................... (1.0)% 5.3 %
1988........................................... 24.1 % 16.6 %
1989........................................... 28.5 % 31.7 %
1990........................................... 0.3 % (3.1)%
1991........................................... 33.8 % 30.4 %
1992........................................... 9.0 % 7.7 %
1993........................................... 1.6 % 10.1 %
1994........................................... (4.5)% 1.2 %
1995........................................... 34.0 % 37.8 %
1996........................................... 22.4 % 22.9 %
1997........................................... 35.1 % 33.4 %
3 months ended 3/31/98......................... 11.7 % 13.9 %
Annualized..................................... 17.3 % 16.3 %
Cumulative..................................... 1414.5 % 1197.4 %
Seventeen-Year Mean (1/1/81-12/31/97).......... 18.1 % 17.0 %
Value of $1 invested during (1/1/81-3/31/98)... $16.92 $14.78
</TABLE>
Notes:
1. The ANNUALIZED RETURN is calculated from monthly data, allowing for com-
pounding. Market value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The CUMULATIVE RETURN means that $1 invested in the composite account on
January 1, 1981 had grown to $16.92 by March 31, 1998.
3. The 17-YEAR MEAN is the arithmetic average of the annual returns for the
calendar years listed.
4. The S&P 500 is an unmanaged index which assumes reinvestment of dividends
and is generally considered representative of securities similar to those
23
<PAGE>
invested in by the Adviser for purpose of the composite performance num-
bers set forth above.
5. The Adviser's average annual management fee over the period shown (1/1/81-
3/31/98) was 0.40% or 40 basis points. During the period, fees on the Ad-
viser's individual accounts ranged from 0.32% to 1.00% (32 basis points to
100 basis points). Net returns to investors vary depending on the manage-
ment fee.
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
Hanson Equity Portfolio................................................ 0.04%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios of the Fund on the basis of
their relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, with its
principal office located at 211 Congress Street, Boston, Massachusetts 02110,
distributes the shares of the Fund. Under the Distribution Agreement (the
"Agree -
24
<PAGE>
ment"), the Distributor, as agent of the Fund, agrees to use its best efforts
as sole distributor of the Fund's shares. The Distributor does not receive any
fee or other compensation under the Agreement with respect to this Portfolio.
The Agreement continues in effect as long as such continuance is approved at
least annually by the Fund's Board of Trustees. Those approving the Agreement
must include a majority of Trustees who are neither parties to the Agreement
nor interested persons of any such party. The Agreement provides that the Fund
will bear costs of registration of its shares with the SEC and various states
and the printing of its prospectuses, its SAIs and its reports to sharehold-
ers.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to the Portfolio in addition to required services. Such bro-
kers may be paid a higher commission than that which another qualified broker
would have charged for effecting the same transaction, provided that such com-
missions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to a Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same time, transactions in such securities will
be allocated among the Portfolio and clients in a manner deemed fair and rea-
sonable by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
25
<PAGE>
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Charles Schwab & Co., Inc., Reinvest Account, held of
record 99.8% of the outstanding shares of the Portfolio's Institutional Class
for which beneficial ownership is disclaimed or presumed disclaimed. The per-
sons or organizations owning 25% or more of the outstanding shares of the
Portfolio may be presumed to "control" (as that term is defined in the 1940
Act) the Portfolio. As a result, these persons or organizations could have the
ability to vote a majority of the shares of the Portfolio on any matter re-
quiring the approval of shareholders of the Portfolio.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover page of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN THE PORTFOLIO'S STATEMENT OF
ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPEC-
TUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OFFERING
MAY NOT BE LAWFULLY MADE.
26
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall, James Small Cap Portfolio
Rice, Hall, James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
27
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Hanson Investment Management Company
4000 Civic Center Drive
Suite 200
San Rafael, CA 94903
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
Jacobs International Octagon Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 2
Risk Factors............................................................... 3
Financial Highlights....................................................... 4
Investment Objectives...................................................... 5
Investment Policies........................................................ 5
Other Investment Policies.................................................. 8
Risks and Additional Investment Information................................ 10
Investment Limitations..................................................... 12
Purchase of Shares......................................................... 13
Redemption of Shares....................................................... 16
Shareholder Services....................................................... 19
Valuation of Shares........................................................ 20
Performance Calculations................................................... 20
Dividends, Capital Gains Distributions and Taxes........................... 21
Investment Adviser......................................................... 22
Adviser's Historical Performance........................................... 24
Administrative Services.................................................... 26
Distributor................................................................ 26
Portfolio Transactions..................................................... 27
General Information........................................................ 27
UAM Funds -- Institutional Class Shares.................................... 29
</TABLE>
<PAGE>
UAM FUNDS JACOBS INTERNATIONAL OCTAGON PORTFOLIO
INSTITUTIONAL CLASS
SHARES
- -------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. Jacobs Inter-
national Octagon Portfolio currently offers only one class of shares. The se-
curities offered in this Prospectus are Institutional Class Shares of one di-
versified, no-load Portfolio of the Fund managed by Jacobs Asset Management.
JACOBS INTERNATIONAL OCTAGON PORTFOLIO. The Jacobs International Octagon
Portfolio (the "Portfolio") seeks to provide long-term capital appreciation by
investing in equity securities of companies in developed and emerging markets.
The Portfolio may invest across the market capitalization spectrum, although
it intends to emphasize smaller capitalization stocks.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the
SAI contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction fees. However, transaction fees may be charged if a broker-dealer
or other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees.............................................. 1.00%
12b-1 Fees............................................................ NONE
Other Expenses........................................................ 0.49%
----
Total Operating Expenses.............................................. 1.49%*
====
</TABLE>
- -----------
* The Total Operating Expenses includes the effect of expense offsets. If ex-
pense offset were excluded, total operating expenses would not be affected.
The Advisor and certain other service providers have voluntarily agreed to
waive all or a portion of their fees and to assume operating expenses to
keep the Portfolio's operating expenses from exceeding 1.75% of average
daily net assets until further notice. The Adviser and/or service providers
may change or discontinue their fee waivers and expense assumptions at any
time.
The table above shows various expenses and fees an investor would bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's operations during the fiscal year ended April 30, 1998.
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Jacobs International Octagon Portfolio
Institutional Shares.................... $15 $47 $81 $178
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN ABOVE.
1
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Jacobs Asset Management is a registered investment adviser. Founded in 1995,
the firm currently has over $415 million in assets under management. (See "IN-
VESTMENT ADVISER.") United Asset Management Corporation is a limited partner
of the Adviser and owns a controlling interest in the Adviser.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. Any realized net capital gains will also
be distributed annually. Distributions will be reinvested in the Portfolio's
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolios may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc., ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
2
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Investors should consider
the following: (1) The Portfolio will invest in securities of foreign issuers,
which will be subject to additional risk factors, including foreign currency
risks, not applicable to securities of U.S. issuers; (2) The Portfolio may in-
vest in repurchase agreements, which entail a risk of loss should the seller
default on its action; (3) The Portfolio may lend its investment securities,
which entails a risk of loss should a borrower fail financially; (4) The Port-
folio's performance may depend on the ability of the Adviser, a relatively new
entity which has not previously served as a mutual fund adviser; however, the
principals of the Adviser have substantial experience as investment advisers
to mutual funds. (See "OTHER INVESTMENT POLICIES.") Contact the UAM Funds
Service Center at the address or telephone number on the front cover of this
prospectus for a free copy of the Portfolio's Annual Report to Shareholders.
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share of
the Portfolio outstanding throughout the period presented of the Portfolio.
This table is part of the Portfolio's Annual Financial Statements, which are
included in the Portfolio's 1998 Annual Report to Shareholders. The Report is
incorporated by reference into the Portfolio's SAI. The Portfolio's Annual Fi-
nancial Statements have been audited by PricewaterhouseCoopers LLP whose un-
qualified opinion thereon is also incorporated into the Portfolio's SAI. The
following information should be read in conjunction with the Portfolio's 1998
Annual Report to Shareholders. Further information about the Portfolio's per-
formance is contained in its Annual Report, which may be obtained without
charge by calling the telephone number on the Prospectus cover page.
<TABLE>
<CAPTION>
YEAR ENDED
APRIL 30, JANUARY 2, 1997*
1998 TO APRIL 30, 1997
---------- -----------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD............. $ 10.17 $ 10.00
-------- -------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.......................... 0.10 0.06
Net Realized and Unrealized Gain on
Investments.................................. 1.82 0.11++
-------- -------
Total from Investment Operations............. 1.92 0.17
-------- -------
DISTRIBUTIONS
Net Investment Income.......................... (0.09) --
Net Realized Gain.............................. (0.15) --
-------- -------
TOTAL DISTRIBUTIONS.............................. (0.24) --
-------- -------
NET ASSET VALUE, END OF PERIOD................... $ 11.85 $ 10.17
======== =======
TOTAL RETURN..................................... 19.19% 1.70%***+
======== =======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (Thousands)............ $113,033 $35,833
Ratio of Expenses to Average Net Assets.......... 1.49% 1.75%**
Ratio of Net Investment Income to Average Net
Assets......................................... 1.23% 3.67%**
Portfolio Turnover Rate.......................... 39% 7%
Average Commission Rate.......................... $ 0.0014 $0.0037
Ratio of Voluntarily Waived Fees and Expenses
Assumed by the Adviser to Average Net Assets .. N/A 0.40%**
Ratio of Expenses to Average Net Assets Including
Expense Offsets................................ 1.49% 1.75%**
</TABLE>
- -----------
* Commencement of Operations.
** Annualized.
*** Not Annualized.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser.
++ The amount shown for a share outstanding throughout the period does not
accord with the aggregate net loss on investments for that period because
of the timing of sales and repurchases of the Portfolio shares in relation
to fluctuating market value of the investments of the Portfolio.
4
<PAGE>
INVESTMENT OBJECTIVES
Jacobs International Octagon Portfolio seeks to provide long-term capital
appreciation by investing in equity securities of companies in developed and
emerging markets. The Portfolio may invest across the market capitalization
spectrum, although it intends to emphasize smaller capitalization stocks.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
INVESTMENT POLICIES
In seeking its investment objective, the Portfolio will, under normal cir-
cumstances, invest at least 85% of its total assets in the equity securities
of developed and emerging markets in at least three countries outside the
United States. The amount of total assets invested in the equity securities of
emerging markets may range from a low of 10% to a high of 40%. Under normal
circumstances, approximately 50% of total assets will be invested in small
capitalization companies. Small capitalization companies are defined as those
companies with market capitalizations of less than $1 billion at the time of
purchase. Equity securities include common stock, preferred stock, convertible
preferred stock, rights and warrants, and American Depositary Receipts
("ADRs"), European Depositary Receipts ("EDRs"), and Global Depositary Re-
ceipts ("GDRs").
Under unusual circumstances, when the Adviser believes that market condi-
tions warrant a defensive position, up to 100% of the Portfolio's assets may
be held in cash and short-term investments. See "TEMPORARY INVESTMENTS" and
"REPURCHASE AGREEMENTS." When the Portfolio is in a defensive position, it may
not necessarily be pursuing its stated investment objective.
Emerging and developed markets in which the Portfolio initially intends to
invest are listed below; however, this list is not exclusive. Investing in
some emerging countries currently is not feasible, or may involve unacceptable
political risks. The Portfolio will focus its investments on those emerging
market countries in which it believes the economies are developing and in
which the markets are becoming more sophisticated. The developed and emerging
countries in which the Adviser initially intends to invest include:
<TABLE>
<S> <C> <C>
Argentina Greece Peru
Australia Hong Kong Philippines
Austria Indonesia Poland
Bermuda Ireland Portugal
Brazil Israel Russia
Czech Republic Italy Singapore
Chile Korea Spain
China Japan Sweden
Denmark Malaysia Switzerland
Finland Mexico Thailand
France Netherlands United Kingdom
Germany Norway
</TABLE>
5
<PAGE>
An "emerging country" security is one issued by a company that, in the opin-
ion of the Adviser, has one or more of the following characteristics: (i) its
principal securities trading market is in an emerging country, (ii) alone or
on a consolidated basis it derives 50% or more of its annual revenue from ei-
ther goods produced, sales made or services performed in emerging countries,
or (iii) it is organized under the laws of, and has a principal office in, an
emerging country. The Adviser will base determinations as to eligibility on
publicly available information and inquiries made to the companies. (See "FOR-
EIGN INVESTMENTS.")
There are no predetermined investment limitations with respect to any one
country, but the Adviser expects to limit investments within a country in ac-
cordance with the Adviser's perception of risks in that country. Generally,
the Portfolio will invest in the equity securities of non-U.S. companies
listed on U.S. or foreign securities exchanges, but may also invest in securi-
ties traded over-the-counter. The Portfolio seeks to invest in companies that
the Adviser believes will benefit from global trends, promising business or
product developments and specific country opportunities resulting from chang-
ing economic, social and political trends. It is expected that investments
will be diversified throughout the world and within markets to minimize spe-
cific country and currency risks. As markets in other countries develop, the
Portfolio expects to expand and further diversify the emerging countries in
which it invests.
The Adviser will use a flexible, value-oriented approach to selecting the
Portfolio's investments. The Adviser will focus on companies rather than on
countries or markets. The goal is to identify stocks selling at the greatest
discount to their intrinsic future value. In attempting to identify value
across disparate economies in the international marketplace, a rigid adherence
to a single model results in missed opportunities. Therefore, the Adviser as-
certains value in a variety of measures, including price/cash flow, enterprise
value/cash flow, and price/future earnings to identify the companies it will
consider for investment. The Adviser's stock picking approach is used across a
full capitalization range which takes advantage of the opportunities in
smaller capitalization companies. Investments generally will be held by the
Portfolio for two to five years.
The Portfolio does not intend to invest in any security in a country where
the currency is not freely convertible to United States dollars, unless the
Portfolio has obtained the necessary governmental licensing to convert such
currency or other appropriately licensed or sanctioned contractual guarantee
to protect such investment against loss of that currency's external value, or
the Portfolio has a reasonable expectation at the time the investment is made
that such governmental licensing or other appropriately licensed or sanctioned
guarantee would be obtained or that the currency in which the security is
quoted would be freely convertible at the time of any proposed sale of the se-
curity by the Portfolio.
The Portfolio intends to purchase and hold securities for long-term capital
appreciation and normally does not expect to trade for short-term gain.
According-
6
<PAGE>
ly, it is anticipated that the annual portfolio turnover rate normally will
not exceed 100%, although in any particular year, market conditions could re-
sult in portfolio activity at a greater or lesser rate than anticipated. The
rate of portfolio turnover will not be a limiting factor when the Portfolio
deems it appropriate to purchase or sell securities.
DEPOSITARY RECEIPTS. The Portfolio may invest directly in securities of
emerging and developed country issuers through sponsored or unsponsored ADRs,
EDRs, and GDRs. ADRs are depositary receipts typically issued by a U.S. bank
or trust company which evidence ownership of underlying securities issued by a
foreign corporation. EDRs and GDRs are typically issued by foreign banks or
trust companies, although they also may be issued by U.S. banks or trust com-
panies and evidence ownership of underlying securities issued by either a for-
eign or a United States corporation. Generally, depositary receipts in regis-
tered form are designed for use in the U.S. securities market and depositary
receipts in bearer form are designed for use in securities markets outside the
United States. Depositary receipts may not necessarily be denominated in the
same currency as the underlying securities into which they may be converted.
INVESTMENT FUNDS. Some countries have laws and regulations that currently
preclude direct foreign investment in the securities of their companies. How-
ever, indirect foreign investment in the securities of companies listed and
traded on the stock exchanges in these countries is permitted through invest-
ment funds which have been specifically authorized. The Portfolio may invest
in these investment funds subject to the provisions of the Investment Company
Act of 1940 ("1940 Act") and other applicable law as discussed below under
"INVESTMENT LIMITATIONS." If the Portfolio invests in such investment funds,
the Portfolio's shareholders will bear not only their proportionate share of
the expenses of the Portfolio (including operating expenses and the fees of
the Adviser), but also will indirectly bear similar expenses of the underlying
investment funds.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. The Portfolio may enter into
forward foreign currency exchange contracts. Forward foreign currency exchange
contracts provide for the purchase or sale of an amount of a specified foreign
currency at a future date. The general purpose of these contracts is both to
put currencies in place to settle trades and to generally protect the United
States dollar value of securities held by the Portfolio against exchange rate
fluctuation. While such forward contracts may limit losses to the Portfolio as
a result of exchange rate fluctuation, they will also limit any gains that may
otherwise have been realized. The Portfolio will enter into such contracts
only to protect against the effects of fluctuating rates of currency exchange
and exchange control regulations. (See "FOREIGN INVESTMENTS.")
TEMPORARY INVESTMENTS. During periods in which the Adviser believes changes
in economic, financial or political conditions make it advisable, the Port-
7
<PAGE>
folio may for temporary defensive purposes reduce its holdings in equity and
other securities and invest in certain short-term (less than twelve months to
maturity) and medium-term (not greater than five years to maturity) debt secu-
rities or may hold cash. (See "SHORT-TERM INVESTMENTS.")
OTHER INVESTMENT POLICIES
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by Standard & Poor's Ratings
Services ("S&P") or Prime-1 or Prime-2 by Moody's Investors Service
("Moody's") or if unrated, determined by the Adviser to be of comparable qual-
ity.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money market instruments including variable rate demand notes
and tax-exempt money instruments. By entering into these investments on a
joint basis, the Portfolio may earn a higher rate of return on investments
relative to what it could earn individually.
The Fund has received permission from the SEC for each of its Portfolios
to invest, for cash management purposes, the greater of 5% of its total assets
or $2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT
COMPANIES.")
8
<PAGE>
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
9
<PAGE>
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon a Portfolio's assets invested in the DSI Money Market Port-
folio, the investing Portfolio's adviser will waive its investment advisory
fee and any other fees earned as a result of the Portfolio's investment in the
DSI Money Market Portfolio. The investing Portfolio will bear expenses of the
DSI Money Market Portfolio on the same basis as all of its other shareholders.
RISKS AND ADDITIONAL INVESTMENT INFORMATION
FOREIGN INVESTMENTS
Investment in securities of foreign issuers, including ADRs, generally in-
volves more risk than investment in the securities of domestic issuers. In ad-
dition, investment in small capitalization securities involves greater risk
than larger, more mature issuers. Such smaller companies may have limited
product lines, markets or financial resources, and their securities may trade
less frequently and in more limited volume than those of larger, more mature
companies. As a result, the prices of their securities may fluctuate more than
those of larger issuers.
There may be limited publicly available information with respect to foreign
issuers, and foreign issuers are not generally subject to uniform accounting,
auditing and financial standards and requirements comparable to those applica-
ble to domestic companies. Therefore, disclosure of certain material informa-
tion may not be made and less information may be available to investors in-
vesting in emerging countries than in the United States. There may also be
less government supervision and regulation of foreign securities exchanges,
brokers and listed companies than in the United States. Many foreign securi-
ties markets have substantially less volume than United States national secu-
rities exchanges, and securities of some for-
10
<PAGE>
eign issuers are less liquid and more volatile than securities of comparable
domestic issuers and lack a secondary trading market. Brokerage commissions
and other transaction costs on foreign securities exchanges are generally
higher than in the United States. Dividends and interest paid by foreign is-
suers may be subject to withholding and other foreign taxes which may decrease
the net return on foreign investments as compared to dividends and interest
paid by domestic companies. Additional risks include future political and eco-
nomic developments, the possibility that a foreign jurisdiction might impose
or change withholding taxes on income payable with respect to foreign securi-
ties, and the possible adoption of foreign governmental restrictions such as
exchange controls.
Prior governmental approval for foreign investments may be required under
certain circumstances in some emerging countries, and the extent of foreign
investment in domestic companies may be subject to limitation in other emerg-
ing countries. Foreign ownership limitations also may be imposed by the char-
ters of individual companies in emerging countries to prevent, among other
concerns, violation of foreign investment limitations. The Portfolio may en-
counter difficulties or be unable to vote proxies, exercise shareholder
rights, pursue legal remedies and obtain judgments in foreign courts. Also,
some countries may withhold portions of income and dividends at the source.
These considerations generally are more of a concern in developing countries,
where the possibility of political instability (including the risk of war) and
dependence on foreign economic assistance may be greater than in developed
countries. Investments in companies domiciled in emerging countries, there-
fore, may be subject to potentially higher risks than investments in developed
countries.
Repatriation of investment income, capital and proceeds of sales by foreign
investors may require governmental registration and/or approval in some emerg-
ing countries. The Portfolio could be adversely affected by delays in or a re-
fusal to grant any required governmental registration or approval for such re-
patriation. Any investment subject to such repatriation controls will be con-
sidered illiquid if it appears reasonably likely that this process will take
more than seven days.
The economies of individual emerging countries may differ favorably or unfa-
vorably from the United States economy in such respect as growth of gross do-
mestic product, rate of inflation, currency depreciation, capital reinvest-
ment, resource self-sufficiency and balance of payments position. Further, the
economies of developing countries generally are heavily dependent upon inter-
national trade and, accordingly, have been and may continue to be adversely
affected by trade barriers, exchange controls, managed adjustments in relative
currency values and other protectionist measures imposed or negotiated by the
countries with which they trade. These economies also have been and may con-
tinue to be adversely affected by economic conditions in the countries with
which they trade.
Investments in securities of foreign issuers are frequently denominated in
foreign currencies, and since the Portfolio may temporarily hold uninvested re-
11
<PAGE>
serves in bank deposits in foreign currencies, the value of the Portfolio's
assets as measured in U.S. dollars may be affected favorably or unfavorably by
changes in currency rates and in exchange controls regulations. Thus, the
Portfolio may incur costs in connection with conversions between various cur-
rencies.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumental-
ities);
(b) with respect to 75% of its assets, purchase more than 10% of any
class of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the se-
curities of companies that have (with predecessors) a continuous op-
erating history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single in-
dustry; however, there are no limitations on investments made in in-
struments issued or guaranteed by the U.S. Government and its agen-
cies.
(e) make loans except by purchasing debt securities in accordance with
its investment objective and policies or entering into repurchase
agreements or by lending its portfolio securities to banks, brokers,
dealers and other financial institutions so long as the loans are
made in compliance with the 1940 Act, as amended, or the Rules and
Regulations or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) a Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent
greater than 33 1/3% of its total assets at fair market value.
The Portfolio's investment objective and investment limitations (a), (b),
(d), (e) and (f)(i) listed above are fundamental policies and may be changed
only with the approval of the holders of a majority of the outstanding voting
securities of the Portfolio. The other investment limitations described here
and those not specified as fundamental in the SAI as well as the Portfolio's
investment policies are not fundamental and the Fund's Board of Trustees may
change them without shareholder approval.
12
<PAGE>
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated service agent. (See "VALUATION OF SHARES.") The
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $500. The minimum initial investment for spousal IRA ac-
counts is $250. Certain exceptions may be permitted by the officers of the
Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemptions of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding additional or different
purchase or redemption conditions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. Amounts paid to Service Agents may include transaction fees
and/or service fees paid by the Fund from the Portfolio's assets attributable
to the Service Agent, which would not be imposed if shares of the Portfolio
were purchased directly from the Fund or the Distributor. Service Agents may
provide shareholder services to their customers that are not available to a
shareholder dealing directly with the Fund. A salesperson and any other person
entitled to receive compensation for selling or servicing Portfolio shares may
receive different compensation with respect to one particular class of shares
over another in the Fund.
Service Agents or, if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by a
Service Agent or its authorized designee. Service Agents are responsible to
their customers and the Fund for timely transmission of all subscription and
redemption requests, investment information, documentation and money.
13
<PAGE>
INITIAL INVESTMENTS
BY MAIL
. Complete and sign an Application and mail it together with a check made
payable to "UAM Funds " to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to UAM Funds.
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that day's price. An account number will then be provided to you in ad-
dition to wiring instructions. Next,
.instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name _____________
Your Account Number _____________
Your Account Name _______________
Wire Control Number _____________
(assigned by the UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investors bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the
14
<PAGE>
right to charge investors for receipt of wired funds, but no charge is
currently imposed for this service. It is necessary to obtain a new wire
control number every time money is wired into an account in a Portfolio.
Wire control numbers are effective for one transaction only and cannot
be used more than once. Wired money that is not properly identified with
a currently effective wire control number will be returned to the bank
from which it was wired and will not be credited to the shareholder's
account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, please notify the UAM Funds Service Center by calling the number on
the cover of this Prospectus. Mail orders should include, when possible, the
"Invest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be long-term investment vehicles and is not
designed to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases can be disruptive to efficient
portfolio management and, consequently, can be detrimental to a Portfolio's
performance and its shareholders. Accordingly, if the Fund's management deter-
mines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
15
<PAGE>
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of the shares depending
on the market value of investment securities held by the Portfolio.
16
<PAGE>
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent do not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
17
<PAGE>
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center or a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by the Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for the Port-
folio as set forth in the Prospectus, where the reduction in value has oc-
curred due to a redemption or exchange out of the account. If at any time your
total investment does not have a value of at least fifty percent of the re-
quired minimum initial investment amount, you may be notified that the value
of your account is below the Portfolio's minimum account balance requirement.
You would then be allowed 60 days to make an additional investment before the
account is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
18
<PAGE>
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into the Portfolio, a shareholder should read its Prospec-
tus and consider the investment objectives of the Portfolio to be purchased.
Call the UAM Funds Service Center for a copy of the Prospectus for the Portfo-
lio(s) in which you are interested. Exchanges can only be made with Portfolios
that are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility for the authentic-
ity of telephoned instructions, see "REDEMPTION OF SHARES -- BY TELEPHONE." An
exchange into another UAM Funds Portfolio is a sale of shares and may result
in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or be pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a
19
<PAGE>
member of ACH. At the shareholder's option, the account designated will be
debited in the specified amount, and shares will be purchased monthly or quar-
terly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets, less any liabilities, by the number of
shares outstanding. The net asset value per share of the Portfolio is deter-
mined as of the close of the NYSE on each day that the NYSE is open for busi-
ness.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a Portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
20
<PAGE>
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the address or telephone number on the
cover of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, the Portfolio will normally distribute such
gains annually. All dividends and capital gains distributions will be automat-
ically reinvested in shares of the Portfolio unless the Fund is notified in
writing that the shareholder elects to receive the distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
21
<PAGE>
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
Jacobs Asset Management (the "Adviser") is a Delaware limited partnership
and is a registered investment adviser formed in July 1995. Its business of-
fices are located at 200 East Broward Boulevard, Suite 1920, Fort Lauderdale,
FL 33301. The Adviser provides and offers investment management and advisory
services to corporations, unions, pensions and profit-sharing plans, trusts,
estates and other institutions and investors. Although the Adviser is a rela-
tively new entity, the principals of the Adviser, who are also the portfolio
managers of the Portfolio, have substantial experience as investment advisers
to mutual funds. As of the date of this Prospectus, the Adviser currently had
over $415 million in assets under management.
United Asset Management Corporation ("UAM") is a limited partner of the Ad-
viser and owns a controlling interest in the Adviser.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 1.00%. The Adviser and certain other service
providers have voluntarily agreed to waive a portion of their advisory fees
and to assume certain operating expenses to the extent necessary to keep the
Portfolio's Service Class Shares' total operating expenses from exceeding
1.75% of average daily net assets, until further notice.
22
<PAGE>
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at their own expense, compensate a Service Agent or other person
for marketing, shareholder servicing, record-keeping and/or other services
performed with respect to the Fund, a Portfolio or any Class of Shares. Pay-
ments made for any of these purposes may be made from its revenues, its prof-
its or any other source available to it. When such service arrangements are in
effect, they are made generally available to all qualified service providers.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney,
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and other shareholder services of its Consulting Group and receives .15
of 1% of the daily net asset value of Institutional Class Shares held by Smith
Barney's eligible customer accounts in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by the Administrator.
The investment professionals at the Adviser who comprise the Investment Com-
mittee, and who are responsible for the day-to-day management of the Portfo-
lio, and their qualifications are as follows:
DANIEL L. JACOBS, CFA, PRESIDENT. Mr. Jacobs managed $3.4 billion in inter-
national and global equity portfolios as Executive Vice President and Director
of Templeton Investment Counsel from 1984 to 1995. Mr. Jacobs was Portfolio
Manager of Templeton's $1.4 billion Smaller Companies Growth Fund and was a
Senior Portfolio Manager of institutional separate accounts. Mr. Jacobs served
as President of the Templeton Variable Annuity Fund and Portfolio Manager for
the Equity and the equity portion of the Balanced Funds in the Templeton Vari-
able Annuity Series.
Prior to joining Templeton, he was Vice President/Portfolio Manager, Insti-
tutional Investment Group and International Division of the First National
Bank of Atlanta from 1976 to 1984. Mr. Jacobs received an MBA in Finance from
Emory University (1976) and a BA in Economics from Miami University (1974). In
addition to holding a CFA and CIC, Mr. Jacobs is a founding member of the In-
ternational Society of Financial Analysts.
WAI W. CHIN, MANAGING DIRECTOR, ASIAN RESEARCH AND PORTFOLIO MANAGEMENT. Ms.
Chin was formerly Vice President of the Global Equity Group of Scudder, Ste-
vens & Clark, where she spent over five years as a Pacific Basin analyst, spe-
cializing in the developed and emerging markets of Asia. She started her re-
search analyst career at Baron Capital, Inc. and was a foreign currency trader
at the Bank of America and Creditanstalt Banverein. Ms. Chin holds a BA in
East Asian Studies from Barnard College and received an MBA in Finance from
Columbia University.
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<PAGE>
ROBERT J. JURGENS, MANAGING DIRECTOR, EUROPEAN RESEARCH AND PORTFOLIO
MANAGEMENT. As Vice President and head of AIG Global Investors' International
Equity Division from 1993 to 1995, Mr. Jurgens was responsible for investment
policy and management of international and global equity portfolios. He has
fourteen years of experience investing in the global stock markets, with par-
ticular expertise in the European markets. Upon graduation from Pennsylvania
State University with a BS in Business/French, Mr. Jurgens spent four years
with Scandinavian Bank Group as a Global Portfolio Manager/Analyst, three
years with Nomura Bank International in London managing global equities, and
two years as an International Equity Manager at the privately held Antessa In-
vestment Management Limited.
ADVISER'S HISTORICAL PERFORMANCE
Below are certain performance data provided by the Adviser pertaining to a
registered, open-end investment company ("mutual fund") that was managed by
Mr. Jacobs with substantially similar (although not necessarily identical) ob-
jectives, policies, and strategies as those of the Portfolio. The investment
returns of the Portfolio may differ from those of the mutual fund because fees
and expenses of the mutual fund may differ from those of the Portfolio. During
Mr. Jacobs' tenure as the portfolio manager of the mutual fund, he was primar-
ily responsible for the day-to-day management of the mutual fund, and no other
person had a significant role in achieving the mutual fund's performance. The
Portfolio and the mutual fund are separate funds, and are members of different
families of investment companies. The results presented are not intended to
predict or suggest the return to be experienced by the Portfolio or the return
an investor might achieve by investing in the Portfolio.
MUTUAL FUND CUMULATIVE RETURNS
ENDED JUNE 30, 1995
<TABLE>
<CAPTION>
THREE YEARS
YEAR ENDED ENDED
JUNE 30, 1995 JUNE 30, 1995
------------- -------------
<S> <C> <C>
Templeton International Fund................... 11.43% 14.55%
Lipper International Index..................... 0.95% 7.22%
Morgan Stanley Capital International ("MSCI")
EAFE Index US$............................... 1.66% 12.68%
</TABLE>
- -----------
Notes:
1. The mutual fund managed by Mr. Jacobs was the Templeton International Fund
of the Templeton Variable Products Series Fund. Mr. Jacobs was the lead
portfolio manager for that mutual fund from inception, May 1, 1992, to
June 30, 1995.
24
<PAGE>
JACOBS ASSET MANAGEMENT HISTORICAL PERFORMANCE
Set forth below are certain performance data provided by the Adviser per-
taining to the composite of separately managed accounts of the Adviser that
are managed with substantially similar (although not necessarily identical)
objectives, policies and strategies as those of the Portfolio. The performance
data for the managed accounts is net of all fees and expenses. The investment
returns of the Portfolio may differ from those of the separately managed ac-
counts because such separately managed accounts may have fees and expenses
that differ from those of the Portfolio. Further, the separately managed ac-
counts are not subject to investment limitations, diversification requirements
and other restrictions imposed by the 1940 Act and the Internal Revenue Code;
such conditions, if applicable, may have lowered the returns for the sepa-
rately managed accounts. The results presented are not intended to predict or
suggest the return to be experienced by the Portfolio or the return an in-
vestor might achieve by investing in the Portfolio.
JACOBS ASSET MANAGEMENT INTERNATIONAL COMPOSITE RETURNS
(PERCENTAGE RETURNS NET OF MANAGEMENT FEES)
<TABLE>
<CAPTION>
MSCI
ADVISER EAFE
------- -----
<S> <C> <C>
1997............................................................. 12.53% 2.06%
1/1/98-4/30/98................................................... 13.37% 15.72%
10/1/95-4/30/98.................................................. 68.61% 30.80%
Annualized Return................................................ 22.41% 10.95%
Cumulative Return................................................ 68.61% 30.80%
</TABLE>
- -----------
Notes:
1. The annualized return is calculated from monthly data, allowing for com-
pounding. Market value of the account was the sum of the account's total
assets, including cash, cash equivalents, short-term investments, and se-
curities valued at current market prices.
2. The cumulative return means that $1 invested in the composite account on
October 1, 1995 had grown to $1.37 by March 31, 1998.
3. The MSCI EAFE is an unmanaged index which assumes reinvestment of divi-
dends and is generally considered representative of securities similar to
those invested in by the Adviser for purpose of the composite performance
numbers set forth above.
4. The Advisor's average annual management fee for the period since inception
on October 1, 1995 to March 31, 1998 was 0.75%, or 75 basis points. Net
returns to investors vary depending on the management fee.
25
<PAGE>
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
Jacobs International Octagon Portfolio................................. 0.04%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among the Portfolios on the basis of their relative as-
sets and are subject to a graduated minimum fee schedule per Portfolio, which
starts at $2,000 per month and increases to $70,000 annually after two years.
If a separate class of shares is added to a Portfolio, its minimum annual fee
increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, with its
principal office located at 211 Congress Street, Boston, MA 02110, distributes
shares of the Fund. Under the Distribution Agreement (the "Agreement"), the
Distributor, as agent of the Fund, agrees to use its best efforts as sole dis-
tributor of Fund shares. The Distributor does not receive any fee or other
compensation under the Agreement with respect to the Shares offered in this
Prospectus. The Agreement continues in effect as long as such continuance is
approved at least annually by the Fund's Board of Trustees. Those approving
the Agreement must include a majority of Trustees who are neither parties to
the Agreement nor interested persons of any such party. The Agreement provides
that the Fund will bear costs of registration of its shares with the SEC and
various states and the printing of its prospectuses, its SAIs and its reports
to shareholders.
26
<PAGE>
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to the Portfolio in addition to required services. Such bro-
kers may be paid a higher commission than that which another qualified broker
would have charged for effecting the same transaction, provided that such com-
missions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to a Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same time, transactions in such securities will
be allocated among the Portfolio and clients in a manner deemed fair and rea-
sonable by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II". On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
27
<PAGE>
No person or corporation owns 25% or more of the outstanding shares of the
Portfolio. The persons or organizations owning 25% or more of the outstanding
shares of a Portfolio may be presumed to "control" (as that term is defined in
the 1940 Act) such Portfolio. As a result, those persons or organizations
could have the ability to vote a majority of the shares of the Portfolio on
any matter requiring the approval of shareholders of such Portfolio.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters to the extent required by
the undertaking.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover page of this Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE FUND'S STATEMENT OF AD-
DITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES NOT CONSTI-
TUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY
NOT LAWFULLY BE MADE.
28
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
29
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Jacobs Asset Management
200 East Broward Boulevard
Suite 1920
Fort Lauderdale, FL 33301
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
MJI International Equity Portfolio
Institutional Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 4
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 8
Investment Limitations..................................................... 13
Purchase of Shares......................................................... 14
Redemption of Shares....................................................... 18
Shareholder Services....................................................... 20
Valuation of Shares........................................................ 22
Performance Calculations................................................... 23
Dividends, Capital Gains Distributions and Taxes........................... 23
Investment Adviser......................................................... 24
Administrative Services.................................................... 25
Distributor................................................................ 26
Portfolio Transactions..................................................... 26
General Information........................................................ 27
UAM Funds -- Institutional Class Shares.................................... 29
</TABLE>
<PAGE>
UAM FUNDS
MJI INTERNATIONAL EQUITY
PORTFOLIO
INSTITUTIONAL CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. MJI Interna-
tional Equity Portfolio currently offers two classes of shares: Institutional
Class Shares and Institutional Service Class Shares ("Service Class Shares").
Shares of each class represent equal, pro rata interests in the Portfolio and
accrue dividends in the same manner except that Service Class Shares bear fees
payable by the class to financial institutions for services they provide to the
owners of such shares. The securities offered in this Prospectus are Institu-
tional Class Shares of one diversified, no-load Portfolio of the Fund managed
by Murray Johnstone International Ltd.
MJI INTERNATIONAL EQUITY PORTFOLIO. MJI International Equity Portfolio (the
"Portfolio") seeks to maximize total return, including both capital apprecia-
tion and current income, by investing primarily in the common stocks of compa-
nies based outside of the United States. Under normal circumstances, at least
65% of the Portfolio's total assets will be invested in securities of issuers
domiciled in at least three countries other than the United States.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Institutional Class Shares will incur. The Fund does not charge
transaction fees. However, transaction fees may be charged if a broker-dealer
or other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees.............................................. 0.75%
12b-1 Fees............................................................ NONE
Other Expenses (After Expenses Assumed or Waived)..................... 0.75%
----
Total Operating Expenses (After Expenses Assumed or Waived)........... 1.50%*
====
</TABLE>
- -----------
* Absent the expenses assumed, Other Expenses and Total Operating Expenses of
the Portfolio would have been 0.82% and 1.57%, respectively. The Total Oper-
ating Expenses includes the effect of expense offsets. If expense offsets
were excluded, total operating expenses would not be affected. The Adviser
and certain other service providers have voluntarily agreed to waive all or
a portion of their advisory fees and/or to assume operating expenses to keep
the Portfolio's Institutional Class Shares total annual operating expenses
(excluding interest, taxes and extraordinary expenses), after the effect of
expense offsets, from exceeding 1.50% of average daily net assets until fur-
ther notice. The Adviser and/or service providers may change or discontinue
their fee waivers and expense assumptions at any time.
The table above shows various fees and expenses an investor may bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's Institutional Class Shares' operations during the fiscal year
ended April 30, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
MJI International Equity Portfolio
Institutional Class Shares.............. $15 $47 $82 $179
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Murray Johnstone International Ltd. (the "Adviser") is an international in-
vestment adviser and is an affiliate of the Murray Johnstone Group ("MJ
Group"), in Glasgow, Scotland. The MJ Group's origins date back to 1907, and
it currently has $7 billion in assets under management. The MJ Group has a
200-member staff including 40 investment professionals. It became a subsidiary
of United Asset Management Corporation in 1993. The Adviser, the SEC-regis-
tered entity within the MJ Group, has $1.4 billion of assets under management
and has a U.S. office in Chicago. (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment in the Portfolio is $2,500. The minimum initial in-
vestment for IRA accounts is $500. The minimum initial investment for spousal
IRA accounts is $250. The minimum for any subsequent investment is $100. Cer-
tain exceptions to the initial or minimum investment amounts may be permitted
by the officers of the Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in an annual dividend. Any realized net capital gains will also be
distributed annually. Distributions will be reinvested in the Portfolio's
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation ("UAM"), is responsible for performing and oversee-
ing administration, dividend disbursing and transfer agency services provided
to the Fund and its Portfolios by third-party service providers. (See "ADMIN-
ISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Prospective investors
should consider the following factors: (1) The Portfolio may invest in repur-
chase agreements which entail a risk of loss should the seller default on its
transaction; (2) The Portfolio may lend its investment securities which en-
tails a risk of loss should a borrower fail financially; (3) The Portfolio may
purchase securities on a when-issued basis which do not earn interest until
issued and may decline or appreciate in market value prior to their delivery
to the Portfolio; (4) The Portfolio may engage in various currency strategies
to seek to hedge its investments against movements in security prices, inter-
est rates, and exchange rates by the use of derivatives, including forward
contracts, options and futures as well as options on futures. Such strategies
are commonly referred to as "derivatives" and involve the risk of imperfect
correlation in movements in the price of options and futures and movements in
the price of securities, interest rates or currencies which are the subject of
the hedge. To the extent these transactions involve foreign securities or cur-
rencies, they are also subject to the risk factors associated with foreign in-
vestments generally. There can be no assurance that a liquid secondary market
for these hedging techniques will exist at any specific time. (See "OTHER IN-
VESTMENT POLICIES.")
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented of the Portfolio's Institutional
Class Shares. This table is part of the Portfolio's Annual Financial State-
ments, which are included in the Portfolio's 1998 Annual Report to Sharehold-
ers. The Report is incorporated by reference into the Portfolio's SAI. The
Portfolio's Annual Financial Statements have been audited by
PricewaterhouseCoopers LLP whose unqualified opinion thereon is also incorpo-
rated into the Portfolio's SAI. The following information should be read in
conjunction with the Portfolio's 1998 Annual Report to Shareholders. Further
information about the Portfolio's performance is contained in its Annual Re-
port, which may be obtained without charge by calling the telephone number on
the Prospectus cover page.
4
<PAGE>
<TABLE>
<CAPTION>
YEAR YEAR YEAR SEPTEMBER 16,
ENDED ENDED ENDED 1994***
APRIL 30, APRIL 30, APRIL 30, TO APRIL 30,
1998 1997 1996 1995
--------- --------- --------- -------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD......................... $ 10.65 $ 10.27 $ 9.50 $10.00
------- ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.......... 0.07 0.06 0.07 0.04
Net Realized and Unrealized
Gain (Loss) on Investments... 2.02 0.42 0.75 (0.54)++
------- ------- ------- ------
Total from Investment
Operations................. 2.09 0.48 0.82 (0.50)
------- ------- ------- ------
DISTRIBUTIONS
Net Investment Income.......... (0.04) (0.01) -- (a) --
In Excess of Net Investment
Income....................... -- -- (0.03) --
Net Realized Gain.............. (0.41) (0.09) (0.02) --
------- ------- ------- ------
Total Distributions.......... (0.45) (0.10) (0.05) --
------- ------- ------- ------
NET ASSET VALUE, END OF PERIOD... $ 12.29 $ 10.65 $ 10.27 $ 9.50
======= ======= ======= ======
TOTAL RETURN+.................... 20.39% 4.67% 8.67% (5.00)%**
======= ======= ======= ======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period
(Thousands).................. $32,296 $28,818 $ 8,592 $5,535
Ratio of Expenses to Average
Net Assets+.................. 1.50% 1.50% 1.45% 1.00%*
Ratio of Net Investment Income
to Average Net Assets........ 0.60% 0.68% 0.88% 1.49%*
Portfolio Turnover Rate........ 80% 47% 59% 81%
Average Commission Rate#....... $0.0278 $0.0323 $0.0316 N/A
Ratio of Voluntary Waived Fees
and Expenses Assumed by the
Adviser to Average Net
Assets....................... 0.07% 0.53% 1.62% 5.50%*
Ratio of Expenses to Average
Net Assets Including Expense
Offsets...................... 1.50% 1.50% 1.43% 1.00%*
</TABLE>
- -----------
* Annualized.
** Not Annualized.
*** Commencement of Operations.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the periods indicated.
++ The amount shown for a share outstanding throughout the period does not
accord with the aggregate net gains on investments for that period because
of the timing of sales and repurchases of the Portfolio shares in relation
to fluctuating market value of the investments of the Portfolio.
# Beginning with fiscal year 1996, the portfolio is required to disclose the
average commission rate per share it paid for portfolio trades on which
commissions were charged.
(a) Amount is less than $0.01 per share.
5
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks to maximize total return, including both capital appre-
ciation and current income, by investing primarily in the common stocks of
companies based outside of the United States. Under normal circumstances, at
least 65% of the Portfolio's total assets will be invested in at least three
different countries other than the United States. There can be no assurance
that the Portfolio will achieve its stated objective.
INVESTMENT POLICIES
The Portfolio's investment process begins by seeking to determine the best
possible allocation among international stock markets. The Portfolio's Adviser
evaluates markets through a proprietary system which analyzes economic fac-
tors, stock prices in each market, market performance and trends in monetary
policy. Drawing on this information, the Adviser decides which markets the
Portfolio should invest in and in what proportion.
Once the country allocation decision has been made, the Adviser selects un-
dervalued stocks in that market. The Adviser rates companies according to the
quality of their management, market position, financial strength, ability to
earn competitive returns on equity and assets, and growth potential. The Port-
folio will invest in stocks that the Adviser determines are undervalued com-
pared to industry norms within their countries. It is expected that invest-
ments will be diversified throughout the world and within markets to minimize
specific country and currency risks. While investments will be made primarily
in securities of companies domiciled in developed countries, investments will
also be made in developing countries. (See "FOREIGN INVESTMENT RISK FACTORS.")
Under normal circumstances, at least 65% of the Portfolio's total assets
will be invested in common stocks of companies in at least three countries
outside the United States. It is expected that generally, the Portfolio will
invest in common stocks of companies listed on U.S. or foreign stock ex-
changes, but it may also invest in stocks traded in the over-the-counter mar-
ket. Common stocks for this purpose also include securities having common
stock characteristics such as rights and warrants to purchase common stocks.
The Portfolio may also invest in convertible securities and preferred stocks.
The Portfolio may also invest in foreign equity securities in the form of
American Depositary Receipts (ADRs), European Depositary Receipts (EDRs) and
other similar global instruments. ADRs (sponsored or unsponsored) are receipts
typically issued by a U.S. bank or trust company evidencing ownership of the
underlying foreign securities. Most ADRs are traded on a U.S. stock exchange.
Issuers of unsponsored ADRs are not contractually obligated to disclose mate-
rial information in the U.S. and, therefore, there may not be a correlation
between such information and the market value of the unsponsored ADR. EDRs are
receipts typically issued by a European bank or trust company evidencing own-
ership of the underlying foreign securities.
6
<PAGE>
FOREIGN INVESTMENT RISK FACTORS
Investors should recognize that investing in foreign securities involves
certain risks which are not typically associated with investing in domestic
securities. Since securities issued by foreign entities may be denominated in
foreign currencies, and the Portfolio may temporarily hold uninvested reserves
in bank deposits in foreign currencies, the Portfolio's value may rise or fall
depending on currency exchange rates. The Portfolio may also have to pay a fee
to convert funds from one currency to another.
Non-U.S.-based companies are not subject to the same accounting, auditing
and financial reporting standards as are domestic companies. There may be less
publicly-available information about non-U.S.-based companies which may make
it difficult to make investment decisions. Also, stock markets outside the
U.S. are typically less liquid -- that is, it is more difficult to sell large
quantities of a stock without driving its price down or to buy without pushing
its price up. Market regulation may be less rigorous in some markets. Finally,
political factors may have an impact in the form of confiscatory taxation, ex-
propriation or political instability in international markets.
Although the Portfolio will seek the most favorable trading costs available
in any given market, investors should recognize that foreign commissions are
generally higher than those in the U.S. Custodial expenses will generally be
higher than would be the case in the U.S. In addition, custodial expenses,
that is, fees paid to financial institutions for holding the Portfolio's secu-
rities, will generally be higher than would be the case in the U.S.
Some foreign governments also levy withholding taxes against dividend and
interest income. Although in some countries a portion of the taxes is recover-
able, the non-recovered portion of foreign withholding taxes will reduce the
income the Portfolio receives from the companies comprising its investments.
Investing in the foreign securities of developing countries presents addi-
tional considerations. The economies of individual developing countries may
differ favorably or unfavorably from the U.S. economy in such respects as
growth of gross domestic product, rate of inflation, currency depreciation,
capital reinvestment, resource self-sufficiency and balance of payments posi-
tion. Further, the economies of developing countries generally are heavily de-
pendent upon international trade and, accordingly, have been and may continue
to be adversely affected by trade barriers, exchange controls, managed adjust-
ments in relative currency values and other protectionist measures imposed or
negotiated by the countries with which they trade. These economies also have
been and may continue to be adversely affected by economic conditions in the
countries with which they trade.
With respect to any developing country, there is the possibility of nation-
alization, expropriation or confiscatory taxation, repatriation of investment
income, cap-
7
<PAGE>
ital and the proceeds of sales by foreign investors, political changes, gov-
ernmental regulation, social instability or diplomatic developments (including
war) which could adversely affect the economies of such countries or the value
of the Portfolio's investments in those countries. In addition, it may be dif-
ficult to obtain and enforce a judgment against foreign issuers.
The Portfolio may engage in various investment techniques such as futures
contracts, options on futures contracts, options, and interest rate swap
transactions. (See "OTHER INVESTMENT POLICIES -- HEDGING AND RELATED STRATE-
GIES AND RISK CONSIDERATIONS.")
OTHER INVESTMENT POLICIES
The Portfolio may, under normal circumstances, invest up to 35% of its as-
sets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities, investments or investment tech-
niques.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by Standard & Poor's Ratings
Services or Prime-1 or Prime-2 by Moody's Investors Service or if unrated, de-
termined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money market instruments including variable rate demand notes
and tax-exempt money
8
<PAGE>
instruments. By entering into these investments on a joint basis, the Portfo-
lio may earn a higher rate of return on investments relative to what it could
earn individually.
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
9
<PAGE>
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices not to in-
crease its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
10
<PAGE>
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees it earned as a result of the Portfolio's invest-
ment in the DSI Money Market Portfolio. The investing Portfolio will bear ex-
penses of the DSI Money Market Portfolio on the same basis as all of its other
shareholders.
HEDGING AND RELATED STRATEGIES AND RISK CONSIDERATIONS
The Portfolio may use options (both exchange-traded and over-the-counter) to
attempt to enhance income. To reduce the overall risk of its investments
(hedge), the Portfolio may use options, futures contracts, options on futures
and forward currency contracts. These instruments are commonly referred to as
derivatives. Hedging strategies may also be used in an attempt to manage the
Portfolio's exposure to changing interest rates, security prices and currency
exchange rates. The Portfolio may buy or sell futures contracts, write covered
call options and buy put and call options on any security, index or currency
including options and futures traded on foreign exchanges and options not
traded on exchanges. The Portfolio's ability to use these strategies may be
limited by market conditions, regulatory limits and tax considerations. The
Portfolio's obligation under such hedging strategies will be covered by the
maintenance of a segregated account of cash or liquid securities equal to at
least 100% of the Portfolio's commitment. The SAI contains further information
on all of these strategies and the risks associated with them.
The Portfolio may write or purchase options in privately negotiated transac-
tions ("OTC Options") as well as listed options. OTC Options can be closed out
only by agreement with the other party to the transaction. Any OTC Option pur-
chased by the Portfolio is considered an illiquid security. Any OTC Option
written by the Portfolio will be with a qualified dealer pursuant to an agree-
ment under which the Portfolio may repurchase the option at a formula price.
Such options are considered illiquid to the extent that the formula price ex-
ceeds the intrinsic value of the option. The Portfolio may not purchase or
sell futures contracts or related options for which the aggregate initial mar-
gin and premiums exceed 5% of the fair market value of the Portfolio's assets.
In order to prevent leverage in connection with the purchase of futures con-
tracts or call options thereon by the Portfolio, an amount of cash, cash
equivalents or liquid securities equal to the market value of the obligation
under the futures contracts or options (less any related market deposits) will
be maintained in a segregated account with the Fund's Custodian. The Portfolio
may not invest more than 15% of its net assets in illiquid securities and re-
purchase agreements which have a maturity of longer than seven days. A more
11
<PAGE>
complete discussion of the potential risks involved in transactions in options
or futures contracts and related options is contained in the SAI.
The Portfolio may enter into forward foreign currency exchange contracts for
the purchase or sale of a specified currency at a specified future date either
with respect to specific transactions or with respect to portfolio positions.
For example, when the Adviser anticipates making a currency exchange transac-
tion in connection with the purchase or sale of a security, the Portfolio may
enter into a forward contract in order to set the exchange rate at which the
transaction will be made. The Portfolio also may enter into a forward contract
to sell an amount of a foreign currency approximating the value of some or all
of the Portfolio's securities denominated in such currency.
The Portfolio may use forward contracts in one currency or a basket of cur-
rencies to hedge against fluctuations in the value of another currency when
the Adviser anticipates there will be a correlation between the two and may
use forward currency contracts to shift the Portfolio's exposure to foreign
currency fluctuations from one country to another. The purpose of entering
into these contracts is to minimize the risk to the Portfolio from adverse
changes in the relationship between the U.S. dollar and foreign currencies.
The Portfolio may enter into interest rate protection transactions, which
consist of interest rate swaps and interest rate caps, collars and floors, for
hedging purposes. These transactions are commonly known as derivatives. A swap
is an agreement to exchange the return generated by one instrument for the re-
turn generated by another instrument. The swaps in which the Portfolio may
also engage include interest rate caps, floors and collars under which one
party pays a single or periodic fixed amount (or premium), and the other party
pays periodic amounts on the movement of a specified index.
The Portfolio may enter into interest rate protection transactions to pre-
serve a return or spread on a particular investment or portion of its portfo-
lio or to protect against any increase in the price of securities it antici-
pates purchasing at a later date. The Portfolio will enter into interest rate
protection transactions only with banks and recognized securities dealers be-
lieved by the Adviser to present minimal credit risks in accordance with
guidelines established by the Fund's Board of Trustees. Interest rate swaps,
caps, floors and collars will be treated as illiquid securities and will
therefore, be subject to the Portfolio's investment restriction limiting in-
vestment in illiquid securities to no greater than 15% of net assets.
RISK CONSIDERATIONS. The Portfolio might not employ any of the hedging
strategies described above, and there can be no assurance that any strategy
used will succeed. If the Adviser incorrectly forecasts interest rates, market
values or other economic factors in utilizing a strategy for the Portfolio,
the Portfolio would be in a better position if it had not hedged at all. In
addition, the Portfolio will pay
12
<PAGE>
commissions and other costs in connection with such hedging strategies which
may increase the Portfolio's expenses and reduce its return.
The use of these strategies involves certain risks, including (1) the fact
that skills needed to use hedging instruments are different from those needed
to select the Portfolio's securities, (2) possible imperfect correlation, or
even no correlation, between price movements of hedging instruments and price
movements of the investments being hedged, (3) the fact that, while hedging
strategies can reduce the risk of loss, they can also reduce the opportunity
for gain, or even result in losses, by offsetting favorable price movements in
hedged investments and (4) the possible inability of the Portfolio to purchase
or sell a portfolio security at a time that otherwise would be favorable for
it to do so, or the possible need for the Portfolio to sell a portfolio secu-
rity at a disadvantageous time, due to the need for it to maintain "cover" or
to segregate securities in connection with hedging transactions and the possi-
ble inability of the Portfolio to close out or to liquidate its hedged posi-
tion.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may invest up to 15% of its
net assets in securities that are illiquid. The prices realized from the sales
of these securities could be less than those originally paid by the Portfolio
or less than what may be considered the fair value of such securities.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
13
<PAGE>
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) a Portfolio may not purchase additional securities when
borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The Portfolio's investment objective and investment limitations (a), (b),
(d), (e) and (f)(i) listed above are fundamental policies and may be changed
only with the approval of the holders of a majority of the outstanding voting
securities of the Portfolio. The other investment limitations described here,
those not specified as fundamental in the SAI, and the Portfolio's investment
policies are not fundamental, and the Fund's Board of Trustees may change them
without shareholder approval.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated service agent. (See "VALUATION OF SHARES.") The
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $500. The minimum initial investment for spousal IRA ac-
counts is $250. Certain exceptions may be permitted by the officers of the
Fund.
Shares of the Portfolio may be purchased by customers of broker-dealers or
other financial intermediaries ("Service Agents") which have established a
shareholder servicing relationship with the Fund on behalf of their customers.
Service Agents may impose additional or different conditions on purchases or
redemptions of Portfolio shares and may charge transaction or other account
fees. Each Service Agent is responsible for transmitting to its customers a
schedule of any such fees and information regarding additional or different
purchase or redemption conditions. Shareholders who are customers of Service
Agents should consult their Serv -
14
<PAGE>
ice Agent for information regarding these fees and conditions. Amounts paid to
Service Agents may include transaction fees and/or service fees paid by the
Fund from the Portfolio's assets attributable to the Service Agent, which
would not be imposed if shares of the Portfolio were purchased directly from
the Fund or the Distributor. Service Agents may provide shareholder services
to their customers that are not available to a shareholder dealing directly
with the Fund. A salesperson and any other person entitled to receive compen-
sation for selling or servicing Portfolio shares may receive different compen-
sation with respect to one particular class of shares over another in the
Fund.
Service Agents or, if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by a
Service Agent or its authorized designee. Service Agents are responsible to
their customers and the Fund for timely transmission of all subscription and
redemption requests, investment information, documentation and money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application and mail it, along with a check payable
to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds."
15
<PAGE>
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired, and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that days price. An account number and a wire control number will be
provided to you in addition to wiring instructions. Next,
. instruct your bank to wire the specified amount to the Fund's custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name _________
Your Account Number __________
Your Account Name __________
Wire Control Number ___________
(assigned by UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on days when the
NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Service Center (payable to "UAM Funds") or by wiring money to
the Custodian Bank as outlined above. When making additional investments, be
sure that the account name and number is identified on the check or wire.
Prior to wiring additional investments, notify the UAM Funds Service Center by
calling the number on the cover of this prospectus. Mail orders should in-
clude, when possible, the "Invest by Mail" stub which accompanies any Fund
confirmation statement.
16
<PAGE>
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be a long-term investment vehicle and is
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lio's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request with
respect to such investor's account. Such investor also may be barred from pur-
chasing other portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the investor upon receipt from the issuer.
Securities acquired through an in-kind purchase will be acquired for invest-
ment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
17
<PAGE>
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone at any time,
without cost at the net asset value of the Portfolio next determined after re-
ceipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of the shares depending
on the market value of investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
18
<PAGE>
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker-dealers guaranteeing signatures must be a member of
a clearing corporation or maintain net capital of at least $100,000. Credit
unions must be authorized to issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the
19
<PAGE>
check clears, payment of the redemption proceeds may be delayed for a period
of up to fifteen days after their purchase, pending determination that the
check has cleared. Investors should consider purchasing shares using a certi-
fied or bank check or money order if they anticipate an immediate need for re-
demption proceeds. The Fund may suspend the right of redemption or postpone
the date at times when either the NYSE or Custodian Bank are closed, or under
any emergency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by a Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for Institu-
tional Class Shares of any other UAM Funds Portfolio. (See the list of Portfo-
lios of the UAM Funds at the end of this Prospectus.) Exchange requests should
be made by contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have
20
<PAGE>
not been issued to the shareholder and if the registration of the two accounts
will be identical. Requests for exchanges received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) will be processed
as of the close of business on the same day. Requests received after the close
of regular trading on the NYSE will be processed on the next business day. The
Fund may modify or terminate the exchange program at any time upon 60 days'
written notice to shareholders, and may reject any exchange request. If the
Fund's management determines that an investor is engaged in excessive trading,
the Fund, with or without prior notice, may reject in whole or part any ex-
change request, with respect to such investor's account. Such investors also
may be barred from exchanging into other portfolios of the UAM Funds. For ad-
ditional information regarding responsibility for the authenticity of tele-
phoned instructions, see "REDEMPTION OF SHARES -- BY TELEPHONE." An exchange
into another UAM Funds Portfolio is a sale of shares and may result in a gain
or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investment made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or by pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Services Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic With -
21
<PAGE>
drawal Plan by using ACH. Redemption made through ACH will be automatically
transferred to the shareholder's bank or other similar financial institution
account or a properly designated third party. The bank or financial institu-
tion must be a member of ACH. Redemptions ordinarily are made on the third
business day of the month and payments ordinarily will be transmitted within
five business days after the redemption date. Because the prices of Fund
shares fluctuate, the number of shares redeemed to finance systematic with-
drawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any time by the Fund. A share-
holder may elect at any time, in writing, to terminate participation in the
Systematic Withdrawal Plan. Such written election must be sent to and received
by the Fund before a termination becomes effective. There is currently no
charge to the shareholder for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the NYSE on each day that the NYSE is open for
business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost when the Board of Trustees determines that amortized cost
reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Trustees.
22
<PAGE>
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount, except that service fees, distribution charges and
any incremental transfer agency costs relating to Service Class Shares will be
borne exclusively by that class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices, all as further
described in the Portfolio's SAI. This information may also be included in
sales literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge.
Contact the UAM Funds Service Center at the telephone number on the cover of
this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in the form of an annual divi-
dend. If any net capital gains are realized, the Portfolio will normally dis-
tribute them annually. All dividends and capital gains distributions will be
automatically reinvested in
23
<PAGE>
additional shares of the Portfolio unless the Fund is notified in writing that
the shareholder elects to receive distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on
December 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
The Adviser is an international investment adviser and is an affiliate of
the MJ Group, in Glasgow, Scotland. The MJ Group's origins date back to 1907,
and it currently has $7 billion in assets under management. The MJ Group has a
200-member staff including 40 investment professionals. It became a subsidiary
of United Asset Management Corporation ("UAM") in 1993. The Adviser, the SEC-
24
<PAGE>
registered entity within the MJ Group, has $1.4 billion of assets under man-
agement and has U.S. offices in Chicago.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 0.75%. The Adviser and certain other service
providers have voluntarily agreed to waive a portion of their advisory fees
and to assume certain operating expenses to the extent necessary to keep the
Portfolio's Institutional Shares' total operating expenses from exceeding
1.50%.
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser, or any of their affili-
ates, may, at their own expense, compensate a Service Agent or other person
for marketing, shareholder servicing, recordkeeping and/or other services per-
formed with respect to the Fund, the Portfolio or any Class of Shares of the
Portfolio. The person making such payments may do so out of its revenues, its
profits or any other source available to it. When such services arrangements
are in effect, they are made generally available to all qualified service
providers.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and other shareholder services and receives from such entities .15 of
1% of the daily net asset value of Institutional Class Shares held by Smith
Barney's eligible customer accounts in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by UAMFSI.
The investment professional at the Adviser responsible for the day-to-day
management of the Portfolio and his qualifications are as follows:
RODGER SCULLION, MANAGING DIRECTOR OF THE ADVISER, has 26 years of invest-
ment experience, the last 14 years based in Glasgow with the MJ Group. He is
the portfolio manager of the Murray Smaller Markets Investment Trust, a
closed-end investment fund registered in the United Kingdom, which invests in
as many as 45 markets worldwide. Mr. Scullion is the Adviser's Chief Invest-
ment Officer and the lead person on the country allocation team. During his
tenure at the MJ Group, he has held portfolio management responsibilities for
investments in the U.S., Europe, Japan and the Far East.
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110.
25
<PAGE>
UAMFSI has subcontracted some of these services to Chase Global Funds Services
Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by a Mutual Funds
Service Agreement dated June 30, 1997. CGFSC is located at 73 Tremont Street,
Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
MJI International Equity Portfolio..................................... 0.06%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or other compensation under the Agreement with respect to the
Portfolio's Institutional Class Shares that are offered in this Prospectus.
The Agreement continues in effect as long as such continuance is approved at
least annually by the Fund's Board of Trustees. Those approving the Agreement
must include a majority of Trustees who are neither parties to the Agreement
nor interested persons of any such party. The Agreement provides that the Fund
will bear the costs of the registration of its shares with the SEC and various
states and the printing of its prospectuses, its SAIs and its reports to
shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio.
26
<PAGE>
The Agreement directs the Adviser to use its best efforts to obtain the best
available price and most favorable execution for all transactions of the Port-
folio. If consistent with the interests of the Portfolio, the Adviser may se-
lect brokers on the basis of the research, statistical and pricing services
they provide to the Portfolio in addition to required services. Such brokers
may be paid a higher commission than that which another qualified broker would
have charged for effecting the same transaction, provided that such commis-
sions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more of these other clients served by the Adviser
is considered at or about the same time transactions in such securities will
be allocated among the Portfolio and clients in a manner deemed fair and rea-
sonable by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Freya Fanning & Company held of record 49.7% of the
outstanding shares of the Portfolio's Institutional Class; and Sisters of Mary
Corp. held of record 30.6% of the outstanding shares of the Portfolio's Serv-
ice Class.
27
<PAGE>
Beneficial ownership of these accounts is disclaimed or presumed disclaimed.
The persons or organizations owning 25% or more of the outstanding shares of a
Portfolio may be presumed to "control" (as that term is defined in the 1940
Act) such Portfolio. As a result, those persons or organizations could have
the ability to vote a majority of the shares of the Portfolio on any matter
requiring the approval of shareholders of such Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of a Portfolio. Service Class Shares bear certain expenses re-
lated to shareholder servicing and the distribution of such shares. Service
Class Shares have exclusive voting rights with respect to matters relating to
such distribution expenditures. The Board of Trustees of the Fund has autho-
rized a third class of shares, Advisor Class Shares, which is not currently
being offered by this Portfolio. For information about Service Class Shares of
the Portfolio, contact the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of the Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
28
<PAGE>
UAM FUNDS -- INSTITUTIONAL CLASS SHARES
Acadian Emerging Markets Portfolio
Acadian International Equity Portfolio
BHM&S Total Return Bond Portfolio
Cambiar Opportunity Portfolio
Chicago Asset Management Intermediate Bond Portfolio
Chicago Asset Management Value/Contrarian Portfolio
C&B Balanced Portfolio
C&B Equity Portfolio
C&B Equity Portfolio for Taxable Investors
C&B Mid Cap Equity Portfolio
DSI Balanced Portfolio
DSI Disciplined Value Portfolio
DSI Limited Maturity Bond Portfolio
DSI Money Market Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
Hanson Equity Portfolio
Heitman Real Estate Portfolio
ICM Equity Portfolio
ICM Fixed Income Portfolio
ICM Small Company Portfolio
Jacobs International Octagon Portfolio
McKee Domestic Equity Portfolio
McKee International Equity Portfolio
McKee Small Cap Equity Portfolio
McKee U.S. Government Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Rice, Hall James Small Cap Portfolio
Rice, Hall James Small/Mid Cap Portfolio
SAMI Preferred Stock Income Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TS&W Balanced Portfolio
TS&W Equity Portfolio
TS&W Fixed Income Portfolio
TS&W International Equity Portfolio
29
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Murray Johnstone International Ltd.
Glasgow, Scotland
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
MJI International Equity Portfolio
Institutional Service Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 8
Investment Limitations..................................................... 13
Purchase of Shares......................................................... 14
Redemption of Shares....................................................... 18
Service and Distribution Plans............................................. 20
Shareholder Services....................................................... 22
Valuation of Shares........................................................ 24
Performance Calculations................................................... 24
Dividends, Capital Gains Distributions and Taxes........................... 25
Investment Adviser......................................................... 26
Administrative Services.................................................... 27
Distributor................................................................ 27
Portfolio Transactions..................................................... 28
General Information........................................................ 28
UAM Funds -- Institutional Service Class Shares............................ 30
</TABLE>
<PAGE>
UAM FUNDS
MJI INTERNATIONAL EQUITY
PORTFOLIO
INSTITUTIONAL SERVICE CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS -- JULY 17, 1998
UAM Funds Trust (the "Fund"), is an open-end investment company known as a
"mutual fund". The Fund consists of multiple series (known as "Portfolios"),
each of which has different investment objectives and policies. MJI Interna-
tional Equity Portfolio currently offers two classes of shares: Institutional
Class Shares and Institutional Service Class Shares ("Service Class Shares").
Shares of each class represent equal, pro rata interests in the Portfolio and
accrue dividends in the same manner except that Service Class Shares bear fees
payable by the class (at the rate of .25% per annum) to financial institutions
for services they provide to the owners of such shares. (See "SERVICE AND DIS-
TRIBUTION PLANS.") The securities offered in this Prospectus are Service Class
Shares of one diversified, no-load Portfolio of the Fund managed by Murray
Johnstone International Ltd.
MJI INTERNATIONAL EQUITY PORTFOLIO. MJI International Equity Portfolio (the
"Portfolio") seeks to maximize total return, including both capital apprecia-
tion and current income, by investing primarily in the common stocks of compa-
nies based outside of the United States. Under normal circumstances, at least
65% of the Portfolio's total assets will be invested in securities of issuers
domiciled in at least three countries other than the United States.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A Statement of Additional Information ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17, 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Service Class Shares will incur. The Fund does not charge transac-
tion fees. However, transaction fees may be charged if a broker-dealer or
other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES.
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees............................................. 0.75%
12b-1 Fees (Including Shareholder Servicing Fees)+................... 0.25%
Other Expenses (After Expenses Assumed).............................. 0.75%
----
Total Operating Expenses (After Expenses Assumed).................... 1.75%+*
====
</TABLE>
- -----------
+ The Service Class Shares may bear service fees of 0.25% of average daily net
assets of the Portfolio. (See "SERVICE AND DISTRIBUTION PLANS.") Long-term
shareholders may pay more than the economic equivalent of the maximum front-
end sales charge permitted by rules of the National Association of Securi-
ties Dealers, Inc.
* The Adviser and certain other service providers have voluntarily agreed to
waive a portion of their advisory fees and/or to assume operating expenses
to keep the Portfolio's Service Class Shares' Total Operating Expenses (ex-
cluding interest, taxes and extraordinary expenses), after the effect of ex-
pense offsets, from exceeding 1.75% of average daily net assets until fur-
ther notice. However, if expense offsets were excluded, Total Operating Ex-
penses would not be affected. Absent the expenses assumed, Other Expenses
and Total Operating Expenses of the Portfolio's Service Class Shares would
be 0.82% and 1.81%, respectively. The Adviser and/or service providers may
change or discontinue their fee waivers and expense assumptions at any time.
The table above shows various fees and expenses an investor may bear di-
rectly or indirectly. The fees and expenses set forth above are based upon the
Portfolio's Service Class Shares' operations during the fiscal year ended
April 30, 1998.
1
<PAGE>
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolios
charge no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
MJI International Equity Portfolio Service
Class Shares............................ $18 $55 $95 $206
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Murray Johnstone International Ltd. (the "Adviser") is an international in-
vestment adviser and is an affiliate of the Murray Johnstone Group ("MJ
Group"), in Glasgow, Scotland. The MJ Group's origins date back to 1907, and
it currently has $7 billion in assets under management. The MJ Group has a
200-member staff including 40 investment professionals. It became a subsidiary
of United Asset Management Corporation in 1993. The Adviser, the SEC-regis-
tered entity within the MJ Group, has $1.4 billion of assets under management
and has U.S. offices in Chicago. (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment in the Portfolio is $2,500. The minimum initial in-
vestment for IRA accounts is $500. The minimum initial investment for spousal
IRA accounts is $250. The minimum for any subsequent investment is $100. Cer-
tain exceptions to the initial or minimum investment amounts may be permitted
by the officers of the Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in an annual dividend. Any realized net capital gains will also be
distributed annually. Distributions will be reinvested in the Portfolio's
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS OF SHARES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" and "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, dividend disbursing and transfer agency services provided to the
Fund and its Portfolios by third-party service providers. (See "ADMINISTRATIVE
SERVICES.")
3
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which the Portfolio invests. Prospective investors
should consider the following: (1) The Portfolio may invest in repurchase
agreements which entail a risk of loss should the seller default on its trans-
action; (2) The Portfolio may lend its investment securities which entails a
risk of loss should a borrower fail financially; (3) The Portfolio may pur-
chase securities on a when-issued basis which do not earn interest until is-
sued and may decline or appreciate in market value prior to their delivery to
the Portfolio; (4) The Portfolio may engage in various currency strategies to
seek to hedge its investments against movements in security prices, interest
rates, and exchange rates by the use of derivatives, including forward con-
tracts, options and futures as well as options on futures. Such strategies are
commonly referred to as "derivatives" and involve the risk of imperfect corre-
lation in movements in the price of options and futures and movements in the
price of securities, interest rates or currencies which are the subject of the
hedge. To the extent these transactions involve foreign securities or curren-
cies, they are also subject to the risk factors associated with foreign in-
vestments generally. There can be no assurance that a liquid secondary market
for these hedging techniques will exist at any specific time. (See "OTHER IN-
VESTMENT POLICIES.")
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the period presented of the Portfolio's Institutional
Service Class Shares. This table is part of the Portfolio's 1998 Annual Finan-
cial Statements, which are included in the Portfolio's 1998 Annual Report to
Shareholders. The Report is incorporated by reference into the Portfolio's
SAI. The Portfolio's Annual Financial Statements have been audited by
PricewaterhouseCoopers LLP whose unqualified opinion thereon is also incorpo-
rated into the Portfolio's SAI. The following information should be read in
conjunction with the Portfolio's 1998 Annual Report to Shareholders. Further
information about the Portfolio's performance is contained in its Annual Re-
port, which may be obtained without charge by calling the telephone number on
the Prospectus cover page.
<TABLE>
<CAPTION>
PERIOD FROM
DECEMBER 31,
1996***
YEAR ENDED TO
APRIL 30, 1998 APRIL 30, 1997
-------------- --------------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD............. $ 10.65 $ 10.53
------- -------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income.......................... 0.04 0.01
Net Realized and Unrealized Gain (Loss) on
Investments.................................. 2.02 0.11
------- -------
Total from Investment Operations............. 2.06 0.12
------- -------
DISTRIBUTIONS
Net Investment Income.......................... (0.04) --
In Excess of Net Investment Income............. -- --
Net Realized Gain.............................. (0.41) --
------- -------
Total Distributions.......................... (0.45) --
------- -------
NET ASSET VALUE, END OF PERIOD................... $ 12.26 $ 10.65
======= =======
TOTAL RETURN+.................................... 20.11% 1.14%**
======= =======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (Thousands).......... $ 7,251 $ 3,920
Ratio of Expenses to Average Net Assets........ 1.75% 1.76%*
Ratio of Net Investment Income to Average Net
Assets....................................... 0.29% 0.59%*
Portfolio Turnover Rate........................ 80% 47%
Average Commission Rate#....................... $0.0278 $0.0323
Ratio of Voluntarily Waived Fees and Expenses
Assumed by the Adviser to Average Net
Assets....................................... 0.06% 0.47%*
Ratio of Expenses to Average Net Assets
Including Expense Offsets.................... 1.75% 1.75%*
</TABLE>
- -----------
* Annualized.
** Not annualized.
*** Commencement of Operations.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the periods indicated.
# Beginning with fiscal year 1996, the portfolio is required to disclose the
average commission rate per share it paid for portfolio trades on which
commissions were charged.
5
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks to maximize total return, including both capital appre-
ciation and current income, by investing primarily in the common stocks of
companies based outside of the United States. Under normal circumstances, at
least 65% of the Portfolio's total assets will be invested in at least three
different countries other than the United States. There can be no assurance
that the Portfolio will achieve its stated objective.
INVESTMENT POLICIES
The Portfolio's investment process begins by seeking to determine the best
possible allocation among international stock markets. The Portfolio's Adviser
evaluates markets through a proprietary system which analyzes economic fac-
tors, stock prices in each market, market performance and trends in monetary
policy. Drawing on this information, the Adviser decides which markets the
Portfolio should invest in and in what proportion.
Once the country allocation decision has been made, the Adviser selects un-
dervalued stocks in that market. The Adviser rates companies according to the
quality of their management, market position, financial strength, ability to
earn competitive returns on equity and assets, and growth potential. The Port-
folio will invest in stocks that the Adviser determines are undervalued com-
pared to industry norms within their countries. It is expected that invest-
ments will be diversified throughout the world and within markets to minimize
specific country and currency risks. While investments will be made primarily
in securities of companies domiciled in developed countries, investments will
also be made in developing countries. (See "FOREIGN INVESTMENT RISK FACTORS.")
Under normal circumstances, at least 65% of the Portfolio's total assets
will be invested in common stocks of companies in at least three countries
outside the United States. It is expected that generally, the Portfolio will
invest in common stocks of companies listed on U.S. or foreign stock ex-
changes, but it may also invest in stocks traded in the over-the-counter mar-
ket. Common stocks for this purpose also include securities having common
stock characteristics such as rights and warrants to purchase common stocks.
The Portfolio may also invest in convertible securities and preferred stocks.
The Portfolio may also invest in foreign equity securities in the form of
American Depositary Receipts (ADRs), European Depositary Receipts (EDRS) and
other similar global instruments. ADRs (sponsored or unsponsored) are receipts
typically issued by a U.S. bank or trust company evidencing ownership of the
underlying foreign securities. Most ADRs are traded on a U.S. stock exchange.
Issuers of unsponsored ADRs are not contractually obligated to disclose mate-
rial information in the U.S. and, therefore, there may not be a correlation
between such information and the market value of the unsponsored ADR. EDRs are
receipts typically issued by a European bank or trust company evidencing own-
ership of the underlying foreign securities.
6
<PAGE>
FOREIGN INVESTMENT RISK FACTORS
Investors should recognize that investing in foreign securities involves
certain risks which are not typically associated with investing in domestic
securities. Since securities issued by foreign entities may be denominated in
foreign currencies, and the Portfolio may temporarily hold uninvested reserves
in bank deposits in foreign currencies, the Portfolio's value may rise or fall
depending on currency exchange rates. The Portfolio may also have to pay a fee
to convert funds from one currency to another.
Non-U.S.-based companies are not subject to the same accounting, auditing
and financial reporting standards as are domestic companies. There may be less
publicly-available information about non-U.S.-based companies which may make
it difficult to make investment decisions. Also, stock markets outside the
U.S. are typically less liquid -- that is, it is more difficult to sell large
quantities of a stock without driving its price down or to buy without pushing
its price up. Market regulation may be less rigorous in some markets. Finally,
political factors may have an impact in the form of confiscatory taxation, ex-
propriation or political instability in international markets.
Although the Portfolio will seek the most favorable trading costs available
in any given market, investors should recognize that foreign commissions are
generally higher than those in the U.S. In addition, custodial expenses, that
is, fees paid to financial institutions for holding the Portfolio's securi-
ties, will generally be higher than would be the case in the U.S.
Some foreign governments also levy withholding taxes against dividend and
interest income. Although in some countries a portion of the taxes is recover-
able, the non-recovered portion of foreign withholding taxes will reduce the
income the Portfolio receives from the companies comprising its investments.
Investing in the foreign securities of developing countries presents addi-
tional considerations. The economies of individual developing countries may
differ favorably or unfavorably from the U.S. economy in such respects as
growth of gross domestic product, rate of inflation, currency depreciation,
capital reinvestment, resource self-sufficiency and balance of payments posi-
tion. Further, the economies of developing countries generally are heavily de-
pendent upon international trade and, accordingly, have been and may continue
to be adversely affected by trade barriers, exchange controls, managed adjust-
ments in relative currency values and other protectionist measures imposed or
negotiated by the countries with which they trade. These economies also have
been and may continue to be adversely affected by economic conditions in the
countries with which they trade.
With respect to any developing country, there is the possibility of nation-
alization, expropriation or confiscatory taxation, repatriation of investment
income, capital and the proceeds of sales by foreign investors, political
changes, governmental
7
<PAGE>
regulation, social instability or diplomatic developments (including war)
which could adversely affect the economics of such countries or the value of
the Portfolio's investments in those countries. In addition, it may be diffi-
cult to obtain and enforce a judgment in a court against foreign issuers.
The Portfolio may engage in various investment techniques such as futures
contracts, options on futures contracts, options, and interest rate swap
transactions. (See "OTHER INVESTMENT POLICIES--HEDGING AND RELATED STRATEGIES
AND RISK CONSIDERATIONS.")
OTHER INVESTMENT POLICIES
The Portfolio may also, under normal circumstances, invest up to 35% of its
assets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities, investments or investment tech-
niques.
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by Standard & Poor's Ratings
Service or Prime-1 or Prime-2 by Moody's Investors Service. or if unrated, de-
termined by the Adviser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of a Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may by purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily uninvested
cash balances of the Fund's Portfolios, as well as cash for investment purpos-
es, into one or more joint accounts and to invest the daily balance of the
joint accounts in the following short-term investments: fully collateralized
repurchase agreements, interest-bearing or discounted commercial paper includ-
ing dollar-denominated commercial paper of foreign issuers, and any other
short-term money market instruments including variable rate demand notes and
tax-exempt money instruments. By entering into these investments on a joint
basis, the Portfolio may earn a higher rate of return on investments relative
to what it could earn individually.
8
<PAGE>
The Fund has received permission from the SEC for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the Seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, the Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. The Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on loan, the loan must be called and the securities
voted.
9
<PAGE>
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but reserves the right to do so.
The table set forth in "Financial Highlights" presents the Portfolio's histor-
ical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company,
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the
10
<PAGE>
Portfolio's assets invested in the DSI Money Market Portfolio, the investing
Portfolio's adviser will waive its investment advisory fee and any other fees
it earned as a result of the Portfolio's investment in the DSI Money Market
Portfolio. The investing Portfolio will bear expenses of the DSI Money Market
Portfolio on the same basis as all of its other shareholders.
HEDGING AND RELATED STRATEGIES AND RISK CONSIDERATIONS
The Portfolio may use options (both exchange-traded and over-the-counter) to
attempt to enhance income. To reduce the overall risk of its investments
(hedge), the Portfolio may use options, futures contracts, options on futures
and forward currency contracts. These instruments are commonly referred to as
derivatives. Hedging strategies may also be used in an attempt to manage the
Portfolio's exposure to changing interest rates, security prices and currency
exchange rates. The Portfolio may buy or sell futures contracts, write covered
call options and buy put and call options on any security, index or currency
including options and futures traded on foreign exchanges and options not
traded on exchanges. The Portfolio's ability to use these strategies may be
limited by market conditions, regulatory limits and tax considerations. The
Portfolio's obligation under such hedging strategies will be covered by the
maintenance of a segregated account of cash or liquid securities equal to at
least 100% of the Portfolio's commitment. The SAI contains further information
on all of these strategies and the risks associated with them.
The Portfolio may write or purchase options in privately negotiated transac-
tions ("OTC Options") as well as listed options. OTC Options can be closed out
only by agreement with the other party to the transaction. Any OTC Option pur-
chased by the Portfolio is considered an illiquid security. Any OTC Option
written by the Portfolio will be with a qualified dealer pursuant to an agree-
ment under which the Portfolio may repurchase the option at a formula price.
Such options are considered illiquid to the extent that the formula price ex-
ceeds the intrinsic value of the option. The Portfolio may not purchase or
sell futures contracts or related options for which the aggregate initial mar-
gin and premiums exceed 5% of the fair market value of the Portfolio's assets.
In order to prevent leverage in connection with the purchase of futures con-
tracts or call options thereon by the Portfolio, an amount of cash, cash
equivalents or liquid securities equal to the market value of the obligation
under the futures contracts or options (less any related market deposits) will
be maintained in a segregated account with the Fund's Custodian. The Portfolio
may not invest more than 15% of its net assets in illiquid securities and re-
purchase agreements which have a maturity of longer than seven days. A more
complete discussion of the potential risks involved in transactions in options
or futures contracts and related options is contained in the SAI.
The Portfolio may enter into forward foreign currency exchange contracts for
the purchase or sale of a specified currency at a specified future date either
with
11
<PAGE>
respect to specific transactions or with respect to portfolio positions. For
example, when the Adviser anticipates making a currency exchange transaction
in connection with the purchase or sale of a security, the Portfolio may enter
into a forward contract in order to set the exchange rate at which the trans-
action will be made. The Portfolio also may enter into a forward contract to
sell an amount of a foreign currency approximating the value of some or all of
the Portfolio's securities denominated in such currency.
The Portfolio may use forward contracts in one currency or a basket of cur-
rencies to hedge against fluctuations in the value of another currency when
the Adviser anticipates there will be a correlation between the two and may
use forward currency contracts to shift the Portfolio's exposure to foreign
currency fluctuations from one country to another. The purpose of entering
into these contracts is to minimize the risk to the Portfolio from adverse
changes in the relationship between the U.S. dollar and foreign currencies.
The Portfolio may enter into interest rate protection transactions, which
consist of interest rate swaps and interest rate caps, collars and floors, for
hedging purposes. These transactions are commonly known as derivatives. A swap
is an agreement to exchange the return generated by one instrument for the re-
turn generated by another instrument. The swaps in which the Portfolio may
also engage include interest rate caps, floors and collars under which one
party pays a single or periodic fixed amount (or premium), and the other party
pays periodic amounts on the movement of a specified index.
The Portfolio may enter into interest rate protection transactions to pre-
serve a return or spread on a particular investment or portion of its portfo-
lio or to protect against any increase in the price of securities it antici-
pates purchasing at a later date. The Portfolio will enter into interest rate
protection transactions only with banks and recognized securities dealers be-
lieved by the Adviser to present minimal credit risks in accordance with
guidelines established by the Fund's Board of Trustees. Interest rate swaps,
caps, floors and collars will be treated as illiquid securities and will
therefore, be subject to the Portfolio's investment restriction limiting in-
vestment in illiquid securities to no greater than 15% of net assets.
RISK CONSIDERATIONS. The Portfolio might not employ any of the hedging
strategies described above, and there can be no assurance that any strategy
used will succeed. If the Adviser incorrectly forecasts interest rates, market
values or other economic factors in utilizing a strategy for the Portfolio,
the Portfolio would be in a better position if it had not hedged at all. In
addition, the Portfolio will pay commissions and other costs in connection
with such hedging strategies, which may increase the Portfolio's expenses and
reduce its return.
The use of these strategies involves certain risks, including (1) the fact
that skills needed to use hedging instruments are different from those needed
to select
12
<PAGE>
the Portfolio's securities, (2) possible imperfect correlation, or even no
correlation, between price movements of hedging instruments and price move-
ments of the investments being hedged, (3) the fact that, while hedging strat-
egies can reduce the risk of loss, they can also reduce the opportunity for
gain, or even result in losses, by offsetting favorable price movements in
hedged investments and (4) the possible inability of the Portfolio to purchase
or sell a portfolio security at a time that otherwise would be favorable for
it to do so, or the possible need for the Portfolio to sell a portfolio secu-
rity at a disadvantageous time, due to the need for it to maintain "cover" or
to segregate securities in connection with hedging transactions and the possi-
ble inability of the Portfolio to close out or to liquidate its hedged posi-
tion.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments by considering all relevant factors. Provided that
a dealer or institutional trading market in such securities exists, these re-
stricted securities are not treated as illiquid securities for purposes of the
Portfolio's investment limitations. The Portfolio may invest up to 15% of its
net assets in securities that are illiquid. The prices realized from the sales
of these securities could be less than those originally paid by the Portfolio
or less than what may be considered the fair value of such securities.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than obligations issued or guaranteed as to principal and in-
terest by the U.S. Government or any of its agencies or instrumentali-
ties);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments
13
<PAGE>
or by lending its portfolio securities to banks, brokers, dealers and
other financial institutions so long as the loans are made in compli-
ance with the 1940 Act, as amended, or the Rules and Regulations or
interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The Portfolio's investment objective and investment limitations (a), (b),
(d), (e) and (f) (i) listed above are fundamental policies and may be changed
only with the approval of the holders of a majority of the outstanding voting
securities of the Portfolio. The other investment limitations described here,
those not specified as fundamental in the SAI, and the Portfolio's investment
policies are not fundamental, and the Fund's Board of Trustees may change them
without shareholder approval.
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor"), without a sales commission at the net asset value per share
next
determined after an order is received by the Fund and payment is received by
the Fund or its designated service agent. (See "VALUATION OF SHARES.") The
minimum initial investment required is $2,500. The minimum initial investment
for IRA accounts is $500. The minimum initial investment for spousal IRA ac-
counts is $250. Certain exceptions may be permitted by the officers of the
Fund.
The Portfolio issues two classes of shares: Institutional Class and Service
Class. The two classes of shares each represent interests in the same portfo-
lio of investments, have the same rights and are identical in all respects,
except that the Service Class Shares offered by this Prospectus bear share-
holder servicing expenses and distribution plan expenses, and have exclusive
voting rights with respect to the Rule 12b-1 Distribution Plan pursuant to
which the distribution fee may be paid. The two classes have different ex-
change privileges. (See "SHAREHOLDER SERVICES--EXCHANGE PRIVILEGE.") The net
income attributable to Service Class Shares and the dividends payable on Serv-
ice Class Shares will be reduced by the amount of the shareholder servicing
and distribution fees; accordingly, the net asset value of the Service Class
Shares will be reduced by such amounts.
Some Service Agents may also impose additional or different conditions or
other account fees on the purchase and redemption of Portfolio shares, which
are
14
<PAGE>
not subject to the Rule 12b-1 Service and Distribution Plans. These may in-
clude transaction fees and/or service fees paid by the Fund from the Portfo-
lio's assets attributable to the Service Agent and, would not be imposed if
shares of the Portfolio were purchased directly from the Fund or the Distribu-
tor. Service Agents may provide shareholder services to their customers that
are not available to a shareholder dealing directly with the Fund. Each Serv-
ice Agent is responsible for transmitting to its customers a schedule of any
such fees and information regarding any additional or different conditions re-
garding purchases and redemptions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. A salesperson and any other person entitled to receive compen-
sation for selling or servicing Portfolio shares may receive different compen-
sation with respect to one particular class of shares over another in the
Fund.
Service Agents or, if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by a
Service Agent or its authorized designee. Service Agents are responsible to
their customers and the Fund for timely transmission of all subscription and
redemption requests, investment information, documentation and money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application, and mail it, together with a check
payable to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of a Portfolio.
15
<PAGE>
If you purchase shares by check, please be sure that your check is made pay-
able to "UAM Funds."
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, the Portfolio selected (Service Class Shares), the amount being
wired and the name of the bank wiring the funds. The call must be re-
ceived prior to the close of regular trading on the NYSE (generally 4:00
p.m. Eastern Time) to receive that day's price. An account number and a
wire control number will then be provided to you. Next,
. instruct your bank to wire the specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name ___________
Your Account Number___________
Your Account Name___________
Wire Control Number___________
(assigned by the UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the NYSE and the Custodian Bank are open for business.
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account name and number is identified on the check or
wire. Prior to wiring additional investments, notify the UAM Funds Service
Center by calling the
16
<PAGE>
number on the cover of this prospectus. Mail orders should include, when pos-
sible, the "Invest by Mail" stub which accompanies any Fund confirmation
statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
Automated Clearing House ("ACH"). Investors purchasing via ACH should complete
the bank information section on the Account Application and attach a voided
check or deposit slip to the Account Application. This option must be estab-
lished on your account at least 15 days prior to your initiating an ACH trans-
action (see "SHAREHOLDER SERVICES--AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares of the Portfolio or to reject purchase orders when, in the judgment
of management, such suspension or rejection is in the best interests of the
Fund. The Portfolio is intended to be a long-term investment vehicle and is
not designed to provide investors with a means of speculation on short-term
market movements. A pattern of frequent purchases can be disruptive to effi-
cient portfolio management and, consequently, can be detrimental to a Portfo-
lio's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with or
without prior notice, may reject in whole or part any purchase request to such
investor's account. Such investor also may be barred from purchasing other
portfolios of the UAM Funds.
Purchases of the Portfolio's shares will be made in full and fractional
shares of the Portfolio calculated to three decimal places. Certificates for
fractional shares will not be issued. Certificates for whole shares will not
be issued except at the written request of the shareholder.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by the Port-
folio in exchange for securities will be issued at net asset value determined
as of the same time. All dividends, interest, subscription, or other rights
pertaining to such securities shall become the property of the Portfolio and
must be delivered to the Fund by the
17
<PAGE>
investor upon receipt from the issuer. Securities acquired through an in-kind
purchase will be acquired for investment and not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of the Portfolio may be redeemed by mail or telephone, at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of your shares depending
on the market value of the investment securities held by the Portfolio.
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
18
<PAGE>
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareowner(s);
. redemptions where the proceeds are to be sent to someplace other
than the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible guarantor
institutions include banks, brokers, dealers, credit unions, national securi-
ties exchanges, registered securities associations, clearing agencies and sav-
ings associations. Broker- dealers guaranteeing signatures must be a member of
a clearing corporation or
19
<PAGE>
maintain net capital of at least $100,000. Credit unions must be authorized to
issue signature guarantees.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of remaining shareholders of the Fund to make payment
wholly or partly in cash, the Fund may pay redemption proceeds in whole or in
part by a distribution in-kind of liquid securities held by the Portfolio in
lieu of cash in conformity with applicable rules of the SEC. Investors may in-
cur brokerage charges on the sale of portfolio securities received in payment
of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to make an additional investment before the ac-
count is liquidated. Retirement accounts and certain other accounts will not
be subject to automatic liquidation. Reductions in value that result solely
from market activity will not trigger an involuntary redemption.
SERVICE AND DISTRIBUTION PLANS
Under the Service Plan for Service Class Shares, the Fund may enter into
service agreements with Service Agents (broker-dealers or other financial in-
stitutions) who receive fees with respect to the Fund's Service Class Shares
owned by shareholders for whom the Service Agent is the dealer or holder of
record, or for whom the Service Agent performs personal services and/or share-
holder account maintenance. These fees are paid out of the assets allocable to
Service Class Shares to the Distributor, to the Service Agents, directly or
through the Distributor. The Fund reimburses the Distributor or the Service
Agent for payments made at an annual rate of up to .25 of 1% of the average
daily value of Service Class Shares.
20
<PAGE>
Each item for which a payment may be made under the Service Plan constitutes
personal service and/or shareholder account maintenance and may constitute an
expense of distributing Fund shares as the SEC construes such term under Rule
12b-1. The fees payable for servicing reflect actual expenses incurred up to
the limit described herein.
Banks are engaged to act as Service Agents only to perform administrative
and shareholder servicing functions, including transaction-related agency
services for their customers. If a bank is prohibited from so acting, alterna-
tive means for continuing the servicing of its shareholders would be sought
and the shareholder clients of the bank would remain Fund shareholders.
The Distribution Plan and Service Plan (the "Plans") provide generally that
a Portfolio may incur distribution and service costs under the Plans which may
not exceed in the aggregate 0.75% per annum of that Portfolio's net assets.
The Board has currently limited aggregate payments under the Plans to 0.50%
per annum of the Portfolio's net assets. The Service Class Shares offered by
this Prospectus currently are not making payments under the Distribution Plan.
Upon implementation, the Distribution Plan would permit payments to the Dis-
tributor, broker-dealers, other financial institutions, sales representatives
or other third parties who render promotional and distribution services, for
items such as sales compensation and marketing and overhead expenses.
The Plans were adopted pursuant to Rule 12b-1 under the 1940 Act. Although
the Plans may be amended by the Board of Trustees, any changes in the Plans
which would materially increase the amounts authorized to be paid under the
Plans must be approved by shareholders of the Class involved. The Plans may be
terminated by the Board of Trustees or Service Class Shareholders. The amounts
and purposes of expenditures under the Plans must be reported to the Board of
Trustees quarterly. The amounts allowable under the Plans for each Class of
Shares of the Portfolios are also limited under certain rules of the National
Association of Securities Dealers Regulation, Inc.
In addition to payments by the Fund under the Plans, the Distributor, United
Asset Management Corporation, the parent company of UAMFSI, and of the Adviser
or any of their affiliates, may, at its own expense, compensate a Service
Agent or other person for marketing, shareholder servicing, recordkeeping
and/or other services performed with respect to the Fund, the Portfolio or any
Class of Shares of the Portfolio. The person making such payments may do so
out of its revenues, its profits or any other source available to it. Such
service arrangements, when in effect, are made generally available to all
qualified service providers. The Adviser may compensate its affiliated compa-
nies for referring investors to the Portfolio.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under
21
<PAGE>
which Smith Barney provides certain defined contribution plan marketing and
shareholder services and receives from such entities an amount equal to up to
33.3% of the portion of the investment advisory fees attributable to the in-
vested assets of Smith Barney's eligible customer accounts without regard to
any expense limitation in addition to amounts payable to all selling dealers.
The Fund also compensates Smith Barney for services it provides to certain de-
fined contribution plan shareholders that are not otherwise provided by
UAMFSI.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Service Class Shares of the Portfolio may be exchanged for Service Class
Shares of any other UAM Funds Portfolio. (See the list of Portfolios of the
UAM Funds at the end of this Prospectus.) Exchange requests should be made by
contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into the Portfolio, a shareholder should read its Prospec-
tus and consider the investment objectives of the Portfolio to be purchased.
Call the UAM Funds Service Center for a copy of the Prospectus for the Portfo-
lio(s) in which you are interested. Exchanges can only be made with Portfolios
that are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will be identical. Requests for exchanges received prior to the
close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) will
be processed as of the close of business on the same day. Requests received
after the close of regular trading on the NYSE will be processed on the next
business day. The Fund may modify or terminate the exchange program at any
time upon 60 days' written notice to shareholders, and may reject any exchange
request. If the Fund's management determines that an investor is engaged in
excessive trading, the Fund, with or without prior notice may reject in whole
or part any exchange request, with respect to such investor's account. Such
investors also may be barred from exchanging into other portfolios of the UAM
Funds. For additional information regarding responsibility for the authentic-
ity of telephoned instructions, see "REDEMPTION OF SHARES -- BY TELEPHONE." An
exchange into another UAM Funds Portfolio is a sale of shares and may result
in a gain or loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of
22
<PAGE>
$100 per transaction) at regular intervals selected by the shareholder. Pro-
vided the shareholder's bank or other financial institution allows automatic
withdrawals, shares are purchased by transferring funds via the Automated
Clearing House ("ACH"). Investment made through ACH will be automatically
transferred from a shareholder's checking, bank money market or NOW account
designated by the shareholder. Such withdrawals are made electronically, if
the shareholder's bank or financial institution so permits, or be pre-autho-
rized checks or drafts drawn on the shareholder's bank or other account. The
bank or financial institution must be a member of ACH. At the shareholder's
option, the account designated will be debited in the specified amount, and
shares will be purchased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemption made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account or a properly designated third party. The bank or finan-
cial institution must be a member of ACH. Redemptions ordinarily are made on
the third business day of the month and payments ordinarily will be transmit-
ted within five business days after the redemption date. Because the prices of
Fund shares fluctuate, the number of shares redeemed to finance systematic
withdrawal payments or a given amount will vary from payment to payment. If a
shareholder owns shares in more than one Portfolio, the shareholder must des-
ignate the Portfolio from which the redemptions under a Systematic Withdrawal
Plan should be made. An additional sheet may be attached to the Optional Serv-
ices Form if a shareholder selects more than one Portfolio. A Systematic With-
drawal Plan may be terminated or suspended at any time by the Fund. A share-
holder may elect at any time, in writing, to terminate participation in the
Systematic Withdrawal Plan. Such written election must be sent to and received
by the Fund before a termination becomes effective. There is currently no
charge to the shareholder for a Systematic Withdrawal Plan.
23
<PAGE>
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the NYSE on each day that the NYSE is open for
business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost when the Board of Trustees determines that amortized cost
reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Fund's Board of Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a portfolio.
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and
24
<PAGE>
Service Class Shares, to the extent any dividends are paid, will be calculated
in the same manner at the same time on the same day and will be in the same
amount, except that service fees, distribution charges and any incremental
transfer agency costs relating to Service Class Shares will be borne exclu-
sively by that class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices, all as further
described in the Portfolio's SAI. This information may also be included in
sales literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the address or phone number on the cover
of this Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders of both of its classes annual-
ly. If any net capital gains are realized, the Portfolio will normally dis-
tribute them annually. All dividends and capital gains distributions will be
automatically reinvested in additional shares of the Portfolio unless the Fund
is notified in writing that the shareholder elects to receive distributions in
cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether distrib-
uted as cash or reinvested in shares are taxable to shareholders as ordinary
income. Short-term capital gains will also be taxed as ordinary income. Long-
term capital gains distributions are taxed as long-term capital gains. Share-
holders will be notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
25
<PAGE>
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
The Adviser is an international investment adviser and is an affiliate of
the MJ Group, in Glasgow, Scotland. The MJ Group's origins date back to 1907,
and it currently has $7 billion in assets under management. The MJ Group has a
200-member staff including 40 investment professionals. It became a subsidiary
of United Asset Management Corporation ("UAM") in 1993. The Adviser, the SEC-
registered entity within the MJ Group, has $1.4 billion of assets under man-
agement and has U.S. offices in Chicago.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is accrued daily and paid every month as a per-
centage of the average net assets in the Portfolio for that month. The per-
centage fee on an annual basis is 0.75%. The Adviser and certain other service
providers have voluntarily agreed to waive a portion of its advisory fees and
to assume certain operating expenses to the extent necessary to keep the Port-
folio's Service Class Shares' total operating expenses from exceeding 1.75%.
The investment professional at the Adviser responsible for the day-to-day
management of the Portfolio and his qualifications are as follows:
RODGER SCULLION, MANAGING DIRECTOR OF THE ADVISER, has 26 years of invest-
ment experience, the last 14 years based in Glasgow with the MJ Group. He is
the portfolio manager of the Murray Smaller Markets Investment Trust, a
closed-end investment fund registered in the United Kingdom, which invests in
as many as 45 markets worldwide. Mr. Scullion is the Adviser's Chief Invest-
ment Officer and the lead person on the country allocation team. During his
tenure at the MJ Group, he has held portfolio management responsibilities for
investments in the U.S., Europe, Japan and the Far East.
26
<PAGE>
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM, is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
RATE
----
MJI International Equity Portfolio..................................... 0.06%
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or other compensation under the Agreement with respect to this
Portfolio (except as described under "Service and Distribution Agreements).
The Agreement continues in effect as long as such continuance is approved at
least annually by the Fund's Board of Trustees. Those approving the Agreement
must include a majority of Trustees who are neither parties to the Agreement
nor interested persons of any such party. The Agreement provides that the Fund
will bear the costs of the registration of its shares with the SEC and various
states and the printing of its prospectuses, its SAIs and its reports to
shareholders.
27
<PAGE>
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolio. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to the Portfolio in addition to required services. Such bro-
kers may be paid a higher commission than that which another qualified broker
would have charged for effecting the same transaction, provided that such com-
missions are paid in compliance with the Securities Exchange Act or 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of the Portfolio and one or more or these other clients served by the Adviser
is considered at or about the same time, transactions in such securities will
be allocated among the Portfolio and clients in a manner deemed fair and rea-
sonable by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no preemptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
28
<PAGE>
As of June 15, 1998, Sisters of Mercy Corp. held of record 30.6% of the out-
standing shares of the Portfolio's Service Class; and Freya Fanning & Co. held
of record 49.7% of the outstanding shares of the Portfolio's Institutional
Class. Beneficial ownership of these accounts is disclaimed or presumed dis-
claimed. The persons or organizations owning 25% or more of the outstanding
shares of a Portfolio may be presumed to "control" (as that term is defined in
the 1940 Act) such Portfolio. As a result, those persons or organizations
could have the ability to vote a majority of the shares of the Portfolio on
any matter requiring the approval of shareholders of such Portfolio.
Both Institutional Class and Service Class Shares represent an interest in
the same assets of a Portfolio. Service Class Shares bear certain expenses re-
lated to shareholder servicing, and the distribution of such shares. Service
Class Shares have exclusive voting rights with respect to matters relating to
such distribution expenditures. The Board of Trustees of the Fund has autho-
rized a third class of shares, Advisor Shares, which is not currently being
offered by this Portfolio. Information about the Institutional Class Shares of
the Portfolio along with the fees and expenses associated with such shares is
available upon request by contacting the UAM Funds Service Center.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover of the Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
29
<PAGE>
UAM FUNDS -- INSTITUTIONAL SERVICE CLASS SHARES
BHM&S Total Return Bond Portfolio
DSI Disciplined Value Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TJ Core Equity Portfolio
30
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Murray Johnstone International Ltd.
Glasgow, Scotland
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
UAM Funds
Prospectus
July 17, 1998
TJ Core Equity Portfolio
Institutional Service Class Shares
[LOGO OF UAM FUNDS APPEARS HERE]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fund Expenses.............................................................. 1
Prospectus Summary......................................................... 3
Risk Factors............................................................... 4
Financial Highlights....................................................... 5
Investment Objective....................................................... 6
Investment Policies........................................................ 6
Other Investment Policies.................................................. 7
Investment Limitations..................................................... 12
Purchase of Shares......................................................... 13
Redemption of Shares....................................................... 16
Service and Distribution Plans............................................. 19
Shareholder Services....................................................... 20
Valuation of Shares........................................................ 22
Performance Calculations................................................... 22
Dividends, Capital Gains Distributions and Taxes........................... 23
Investment Adviser......................................................... 24
Administrative Services.................................................... 26
Distributor................................................................ 26
Portfolio Transactions..................................................... 27
General Information........................................................ 27
UAM Funds -- Institutional Service Class Shares............................ 29
</TABLE>
<PAGE>
UAM FUNDS
TJ CORE EQUITY PORTFOLIO
INSTITUTIONAL SERVICE CLASS SHARES
- --------------------------------------------------------------------------------
PROSPECTUS--JULY 17, 1998
UAM Funds Trust (the "Fund") is an open-end investment company known as a
"mutual fund." The Fund consists of multiple series (known as "Portfolios")
each of which has different investment objectives and policies. TJ Core Equity
Portfolio currently offers only one class of shares. The securities offered in
this Prospectus are Institutional Service Class Shares ("Service Class Shares")
of one diversified no-load Portfolio of the Fund managed by Tom Johnson Invest-
ment Management, Inc.
TJ CORE EQUITY PORTFOLIO. TJ Core Equity Portfolio (the "Portfolio") seeks
maximum total return consistent with reasonable risk to principal by investing
in the common stock of quality companies with lower valuations in sectors of
the economy exhibiting strong, or improving relative performance.
There can be no assurance that the Portfolio will achieve its stated objec-
tive.
Keep this Prospectus for future reference. It contains information that you
should know before you invest. A "Statement of Additional Information" ("SAI")
containing additional information about the Fund has been filed with the Secu-
rities and Exchange Commission ("SEC"). The SAI is dated July 17 1998 and has
been incorporated by reference into this Prospectus. For a free copy of the SAI
contact the UAM Funds Service Center at 1-800-638-7983.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<PAGE>
FUND EXPENSES
The following table illustrates expenses and fees that a shareholder of the
Portfolio's Service Class Shares will incur. The Fund does not charge transac-
tion fees. However, transaction fees may be charged if a broker-dealer or
other financial intermediary deals with the Fund on your behalf. (See "PUR-
CHASE OF SHARES.")
SHAREHOLDER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases......................................... NONE
Sales Load Imposed on Reinvested Dividends.............................. NONE
Deferred Sales Load..................................................... NONE
Redemption Fees......................................................... NONE
Exchange Fee............................................................ NONE
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
<TABLE>
<S> <C>
Investment Advisory Fees (After Fee Waiver).......................... 0.00%
12b-1 Fees (Including Shareholder Servicing Fees).................... 0.25%
Other Expenses (After Expenses Assumed or waived)+................... 1.00%
----
Total Operating Expenses (After Fee Waiver and Expenses Assumed)..... 1.25%+*
====
</TABLE>
- -----------
+ The Service Class Shares may bear service fees of 0.25% of average daily net
assets of the Portfolio. (See "SERVICE AND DISTRIBUTION PLANS.") Long-term
shareholders may pay more than the economic equivalent of the maximum front-
end sales charges permitted by rules of the National Association of Securi-
ties Dealers, Inc.
* The Adviser and certain other service providers have voluntarily agreed to
waive all or a portion of their advisory fees and/or to assume operating ex-
penses to keep the Portfolio's Service Class Shares' total annual operating
expenses (excluding interest, taxes and extraordinary expenses), after the
effect of expense offsets, from exceeding 1.25% of average daily net assets
through January 1, 2000. The figures above include the effect of expense
offsets. However, if expense offsets were excluded, Total Operating Expenses
for the fiscal year ended April 30, 1998 would not be affected. (See "FINAN-
CIAL HIGHLIGHTS.") Absent fee waivers and expense assumptions, Investment
Advisory Fees, Other Expenses and the Total Operating Expenses of the Port-
folio's Service Class Shares would have been 0.75%, 1.77% and 2.77%, respec-
tively, of average daily net assets. The Adviser and/or service providers
may change or discontinue its fee waivers and expense assumptions at any
time.
1
<PAGE>
The table above shows various fees and expenses an investor would bear di-
rectly or indirectly. The expenses and fees set forth above are based on the
Portfolio's Service Class Shares' operations during the fiscal year ended
April 30, 1998.
EXAMPLE
The following example illustrates expenses a shareholder would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. The Portfolio
charges no redemption fees of any kind.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
TJ Core Equity Portfolio..................... $13 $40 $69 $151
</TABLE>
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN THOSE
SHOWN.
2
<PAGE>
PROSPECTUS SUMMARY
INVESTMENT ADVISER
Tom Johnson Investment Management, Inc. (the "Adviser") is a registered in-
vestment adviser. Founded in 1983, the Adviser currently has approximately
$2.4 billion in assets under management. The Adviser is a wholly-owned subsid-
iary of United Asset Management Corporation. (See "INVESTMENT ADVISER.")
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") to investors at net asset value without a sales commission.
Share purchases may be made by sending investments directly to the Fund. The
minimum initial investment is $2,500. The minimum for subsequent investments
is $100. The minimum initial investment for IRA accounts is $500. The minimum
initial investment for spousal IRA accounts is $250. Certain exceptions to the
initial or minimum investment amounts may be permitted by the officers of the
Fund. (See "PURCHASE OF SHARES.")
DIVIDENDS AND DISTRIBUTIONS
The Portfolio will normally distribute substantially all of its net invest-
ment income in quarterly dividends. The Portfolio will distribute any realized
net capital gains annually. Distributions will be reinvested in Portfolio
shares automatically unless an investor elects to receive cash distributions.
(See "DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES.")
REDEMPTIONS AND EXCHANGES
Shares of the Portfolio may be redeemed at any time, without cost, at the
net asset value of the Portfolio next determined after receipt of the redemp-
tion request. The redemption price may be more or less than the purchase
price. Shares of the Portfolio may be exchanged for shares of the same class
of any other portfolio of the UAM Funds. (See "REDEMPTION OF SHARES" AND "EX-
CHANGE PRIVILEGE.")
ADMINISTRATIVE SERVICES
UAM Funds Services Inc. ("UAMFSI"), a wholly-owned subsidiary of United As-
set Management Corporation, is responsible for performing and overseeing ad-
ministration, fund accounting, dividend disbursing and transfer agency serv-
ices provided to the Fund and its Portfolios by third-party service providers.
(See "ADMINISTRATIVE SERVICES.")
3
<PAGE>
RISK FACTORS
The value of the Portfolio's shares will fluctuate in response to changes in
market and economic conditions as well as the financial conditions and pros-
pects of the issuers in which a Portfolio invests. Investors should consider
the following factors: (1) The Portfolio may invest in repurchase agreements
which entail a risk of loss should the seller default on its transaction; (2)
The Portfolio may invest a portion of its assets in derivatives including
futures contracts and options; (3) The Portfolio may invest in the securities
of foreign issuers which may be subject to additional risk factors, including
foreign currency risks, not applicable to securities of U.S. issuers; (4) The
fixed income securities held by the Portfolio will be affected by general
changes in interest rates resulting in increases or decreases in the value of
the securities. The value of fixed income securities can be expected to vary
inversely to the changes in prevailing interest rates, i.e., as interest rates
decline, the market value of fixed income securities tends to increase and
vice versa; (5) The Portfolio may invest in investment-grade debt securities,
but reserves the right to hold securities that have been downgraded. Adverse
economic and corporate changes and changes in interest rates may have a
greater impact on issuers of lower rated debt securities which the Portfolio
may hold, which may lead to greater price volatility. Also, lower rated secu-
rities may be more difficult to value accurately or sell in the secondary mar-
ket; (6) The Portfolio may lend its investment securities which entails a risk
of loss should a borrower fail financially; and (7) The Portfolio may purchase
securities on a when-issued basis which do not earn interest until issued and
may decline or appreciate in market value prior to their delivery to the Port-
folio. (See "OTHER INVESTMENT POLICIES.")
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table provides selected per share information for a share out-
standing throughout the periods presented of the Portfolio. This table is part
of the Portfolio's Annual Financial Statements which are included in the Port-
folio's 1998 Annual Report to Shareholders. The Report is incorporated by ref-
erence into the Portfolio's SAI. The Portfolio's Annual Financial Statements
have been audited for the period ended April 30, 1998 by
PricewaterhouseCoopers LLP whose unqualified opinion thereon is also incorpo-
rated into the Portfolio's SAI. The following information should be read in
conjunction with the Portfolio's 1998 Annual Report to Shareholders. Further
information about the Portfolio's performance is contained in its Annual Re-
port, which may be obtained without charge by calling the telephone number on
the Prospectus cover page.
<TABLE>
<CAPTION>
SEPTEMBER 28,
1995*
YEAR ENDED YEAR ENDED TO
APRIL 30, 1998 APRIL 30, 1997 APRIL 30, 1996
-------------- -------------- --------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD......................... $ 13.05 $ 11.05 $ 10.00
------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income.......... 0.10 0.12 0.06
Net Realized and Unrealized
Gain on Investments........... 4.55 2.08 1.05
------- ------- -------
Total From Investment
Operations.................... 4.65 2.20 1.11
------- ------- -------
DISTRIBUTIONS
Net Investment Income.......... (0.11) (0.11) (0.06)
Net Realized Gain.............. (0.29) (0.09) --
------- ------- -------
Total Distributions............ (0.40) (0.20) (0.06)
------- ------- -------
NET ASSET VALUE, END OF PERIOD.. $ 17.30 $ 13.05 $ 11.05
======= ======= =======
TOTAL RETURN+................... 36.05 % 20.14 % 11.13 %***
======= ======= =======
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period
(Thousands)................... $11,348 $ 2,888 $ 1,023
Ratio of Expenses to Average
Net Assets.................... 1.25 % 1.26 % 1.38 %**
Ratio of Net Investment Income
to Average Net Assets......... 0.74 % 1.07 % 1.06 %**
Portfolio Turnover Rate........ 52 % 27 % 17 %
Average Commission Rate........ $0.0600 $0.0600 $0.0600
Ratio of Voluntary Waived Fees
and Expenses Assumed by the
Adviser to Average Net
Assets........................ 1.52 % 5.38 % 12.48 %**
Ratio of Expenses to Average
Net Assets Including Expense
Offsets....................... 1.25 % 1.25 % 1.25 %**
</TABLE>
- -----------
*Commencement of Operations.
**Annualized.
***Not Annualized.
+ Total return would have been lower had certain fees not been waived and
expenses assumed by the Adviser during the period.
5
<PAGE>
INVESTMENT OBJECTIVE
The Portfolio seeks maximum total return consistent with reasonable risk to
principal by investing in the common stock of quality companies with lower
valuations in sectors of the economy exhibiting strong, or improving relative
performance. The Portfolio may also invest in other equity-related securities
such as preferred stocks, convertible preferred stocks, convertible bonds, op-
tions, futures, rights and warrants. There can be no assurance that the Port-
folio will achieve its stated objective.
INVESTMENT POLICIES
In seeking its investment objective, the Portfolio will invest at least 65%
of its total assets, under normal circumstances, in equity securities, con-
sisting primarily of common stock of companies with market capitalizations
greater than $200 million at the time of purchase. Furthermore, the Portfolio
will invest so that 80% of the Portfolio's common stock holdings will be of
issuers with market capitalizations greater than $800 million. The Portfolio
may also invest in other equity-related securities such as preferred stock,
convertible preferred stock, convertible bonds, options on stock indices,
rights and warrants. The Portfolio may also invest up to 35% of its assets in
investment grade debt securities which are generally considered to be those
securities having one of the four highest grades assigned by Moody's Investors
Service ("Moody's") (Aaa, Aa, A or Baa) or Standard & Poor's Ratings Service
(AAA, AA, A or BBB) or, if unrated, of equivalent quality in the Adviser's
judgment. Securities rated Baa or BBB may possess speculative characteristics
and may be more sensitive to changes in the economy and the financial condi-
tion of issuers than higher rated securities. The Adviser also reserves the
right to retain securities which are downgraded by one or both of the rating
agencies, if in the Adviser's judgment, the retention of securities is war-
ranted. Up to 20% of the Portfolio's assets may be invested in the securities
of foreign issuers.
The Adviser believes that maximum total return can be achieved by investing
in the common stock of quality companies with lower valuations in sectors of
the economy exhibiting strong, or improving relative performance. Beginning
with a thorough analysis of current and anticipated economic fundamentals, ex-
amining key economic variables such as the level and direction of interest
rates, forecasted growth in the GDP, anticipated gains in corporate profits,
inflationary pressures, and money supply growth, as well as other variables,
the Adviser is able to determine the basis for asset allocation between stocks
and cash and cash equivalents.
The analysis of key economic variables also helps identify industry groups
or specific industries which should benefit as a result of anticipated eco-
nomic fundamentals. These industry groups are then analyzed in detail begin-
ning with industry screens, going onto individual company analysis, and fi-
nally specific purchase recommendations. Of particular interest to the Adviser
is the valuation being placed
6
<PAGE>
upon the company as well as the forecasted growth in earnings and dividends
over the next 1 to 5 years.
It is anticipated that cash reserves will represent a relatively small per-
centage of the Portfolio's assets. Under normal circumstances, it will be less
than 20%. However, when the Adviser believes that market conditions warrant a
defensive position, up to 100% of the Portfolio's assets may be held in cash
and short-term investments. See "SHORT-TERM INVESTMENTS and REPURCHASE AGREE-
MENTS" below for a description of the types of short-term instruments in which
the Portfolio may invest for temporary defensive purposes. When the Portfolio
is in a defensive position, it may not necessarily be pursuing its stated in-
vestment objective.
OTHER INVESTMENT POLICIES
The Portfolio may also, under normal circumstances, invest up to 35% of its
assets, unless restricted by additional limitations described below or in the
Portfolio's SAI, in the following securities, investments or investment tech-
niques:
SHORT-TERM INVESTMENTS
In order to earn a return on uninvested assets, meet anticipated redemp-
tions, or for temporary defensive purposes, the Portfolio may invest a portion
of its assets in domestic and foreign money market instruments including cer-
tificates of deposit, bankers' acceptances, time deposits, U.S. Government ob-
ligations, U.S. Government agency securities, short-term corporate debt secu-
rities, and commercial paper rated A-1 or A-2 by Standard & Poor's Ratings
Service or Prime-1 or Prime-2 by Moody's or, if unrated, determined by the Ad-
viser to be of comparable quality.
Time deposits maturing in more than seven days will not be purchased by the
Portfolio, and time deposits maturing from two business days through seven
calendar days will not exceed 10% of the total assets of the Portfolio. The
Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion, or the equivalent in
other currencies, (ii) in the case of U.S. banks, it is a member of the Fed-
eral Deposit Insurance Corporation, and (iii) in the case of foreign branches
of U.S. banks, the security is, in the opinion of the Adviser, of an invest-
ment quality comparable with other debt securities which may be purchased by
the Portfolio.
The Fund has received permission from the SEC to deposit the daily
uninvested cash balances of the Fund's Portfolios, as well as cash for invest-
ment purposes, into one or more joint accounts and to invest the daily balance
of the joint accounts in the following short-term investments: fully collater-
alized repurchase agreements, interest-bearing or discounted commercial paper
including dollar-denominated commercial paper of foreign issuers, and any
other short-term money
7
<PAGE>
market instruments including variable rate demand notes and tax-exempt money
instruments. By entering into these investments on a joint basis, the Portfo-
lio may earn a higher rate of return on investments relative to what it could
earn individually.
The Fund has received permission from the SEC, for each of its Portfolios to
invest, for cash management purposes, the greater of 5% of its total assets or
$2.5 million in the DSI Money Market Portfolio. (See "INVESTMENT COMPANIES.")
REPURCHASE AGREEMENTS
The Portfolio may invest in repurchase agreements collateralized by U.S.
Government securities, certificates of deposit, and certain bankers' accept-
ances and other securities outlined above under "SHORT-TERM INVESTMENTS." In a
repurchase agreement, the Portfolio buys a security and simultaneously commits
to sell that security back at an agreed upon price plus an agreed upon market
rate of interest. Under a repurchase agreement, the seller is also required to
maintain the value of securities subject to the agreement at not less than
100% of the repurchase price. The value of the securities purchased will be
evaluated daily, and the Adviser will, if necessary, require the seller to
maintain additional securities to ensure that the value is in compliance with
the previous sentence. The use of repurchase agreements involves certain
risks. For example, a default by the seller of the agreement may cause the
Portfolio to experience a loss or delay in the liquidation of the collateral
securing the repurchase agreement. The Portfolio might also incur disposition
costs in liquidating the collateral. While the Fund's management acknowledges
these risks, it is expected that they can be controlled through stringent
counter-party selection criteria and careful monitoring procedures. The Fund
has received permission from the SEC to pool daily uninvested cash balances of
the Fund's Portfolios in order to invest in repurchase agreements on a joint
basis. By entering into joint repurchase agreements, a Portfolio may incur
lower transaction costs and earn higher rates of interest on joint repurchase
agreements. Each Portfolio's contribution would determine its return from a
joint repurchase agreement. (See "SHORT-TERM INVESTMENTS.")
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified institutional
investors as a means of earning income. The Portfolio will not loan securities
to the extent that greater than one-third of its total assets at fair market
value would be committed to loans. During the term of a loan, the Portfolio is
subject to a gain or loss depending on any increase or decrease in the market
price of the securities loaned. Lending of securities is subject to review by
the Fund's Board of Trustees. All relevant facts and circumstances, including
the creditworthiness of the broker, dealer or institution, will be considered
by the Adviser in making decisions about securities lending.
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An investment company may pay reasonable negotiated fees in connection with
loaned securities so long as such fees are set forth in a written contract and
approved by its Board of Trustees. The Portfolio will continue to retain any
voting rights with respect to loaned securities. If a material event occurs
affecting an investment on a loan, the loan must be called and the securities
voted.
WHEN-ISSUED, FORWARD DELIVERY AND DELAYED SETTLEMENT SECURITIES
The Portfolio may purchase and sell securities on a "when-issued," "delayed
settlement," or "forward delivery" basis. "When-issued" or "forward delivery"
refers to securities whose terms and indenture are available, and for which a
market exists, but which are not available for immediate delivery. When-issued
and forward delivery transactions may be expected to occur a month or more be-
fore delivery is due. Delayed settlement is a term used to describe settlement
of a securities transaction in the secondary market which will occur sometime
in the future. No payment or delivery is made by the Portfolio until it re-
ceives delivery or payment from the other party to any of the above transac-
tions. It is possible that the market price of the securities at the time of
delivery may be higher or lower than the purchase price. The Portfolio will
maintain a separate account of cash or liquid securities at least equal to the
value of purchase commitments until payment is made. Typically, no income ac-
crues on securities purchased on a delayed delivery basis prior to the time
delivery is made although the Portfolio may earn income on securities it has
deposited in a segregated account.
The Portfolio may engage in these types of purchases in order to buy securi-
ties that fit with its investment objectives at attractive prices -- not to
increase its investment leverage.
PORTFOLIO TURNOVER
In addition to Portfolio trading costs, higher rates of portfolio turnover
may result in the realization of capital gains. (See "DIVIDENDS, CAPITAL GAINS
DISTRIBUTIONS AND TAXES" for more information on taxation). The Portfolio will
not normally engage in short-term trading, but each reserves the right to do
so. The table set forth in "Financial Highlights" presents the Portfolio's
historical portfolio turnover rates.
INVESTMENT COMPANIES
The Portfolio reserves the right to invest up to 10% of its total assets,
calculated at the time of investment, in the securities of other open-end or
closed-end investment companies. No more than 5% of the investing Portfolio's
total assets may be invested in the securities of any one investment company,
nor may it acquire more than 3% of the voting securities of any other invest-
ment company. The Portfolio will indirectly bear its proportionate share of
any management fees paid by an investment company in which it invests in addi-
tion to the advisory fee paid by the Portfolio.
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<PAGE>
The Fund has received permission from the SEC to allow each of its Portfo-
lios to invest, for cash management purposes, the greater of 5% of its total
assets or $2.5 million in the DSI Money Market Portfolio provided that the in-
vestment is consistent with the Portfolio's investment policies and restric-
tions. Based upon the Portfolio's assets invested in the DSI Money Market
Portfolio, the investing Portfolio's adviser will waive its investment advi-
sory fee and any other fees earned as a result of the Portfolio's investment
in the DSI Money Market Portfolio. The investing Portfolio will bear expenses
of the DSI Money Market Portfolio on the same basis as all of its other share-
holders.
FUTURES AND OPTIONS TRANSACTIONS
In order to remain fully invested, and to reduce transaction costs, the
Portfolio may utilize appropriate futures contracts and options to a limited
extent. These instruments are commonly referred to as "derivatives." Because
transaction costs associated with futures and options may be lower than the
costs of investing in securities directly, it is expected that the use of in-
dex futures and options to facilitate cash flows may reduce the Portfolio's
overall transaction costs. The Portfolio will enter into futures contracts and
options for bona fide hedging purposes only and for other purposes so long as
aggregate initial margins and premiums required in connection with non-hedging
positions do not exceed 5% of the Portfolio's total assets.
Futures and options can be volatile and involve various degrees and types of
risk. If the Portfolio judges market conditions incorrectly or employs a
strategy that does not correlate well with its investments, use of futures and
options contracts could result in a loss. The Portfolio could also suffer
losses if it is unable to liquidate its position due to an illiquid secondary
market. In the opinion of the Trustees, the risk that the Portfolio will be
unable to close out a futures position or options contract will be minimized
by only entering into futures contracts or options transactions traded on na-
tional exchanges and for which there appears to be a liquid secondary market.
For additional information regarding futures contracts and options, please see
the SAI.
FOREIGN INVESTMENTS
The Portfolio may invest up to 20% of its assets in foreign securities which
involve additional risks not typically associated with investing in domestic
securities. Since the securities issued by foreign entities may be denominated
in foreign currencies, and the Portfolio may temporarily hold uninvested re-
serves in bank deposits in foreign currencies, the Portfolio's value may rise
or fall depending on currency exchange rates. The Portfolio may also have to
pay a fee to convert funds from one currency to another.
Non-U.S.-based companies are not subject to the same accounting, auditing
and financial reporting standards as are domestic companies and may have poli-
cies
10
<PAGE>
that are not comparable to those of domestic companies. There may be less pub-
licly-available information about non-U.S.-based companies which may make it
difficult to make investment decisions. Securities of some foreign companies
are generally less liquid and more volatile than securities of comparable do-
mestic companies. There is generally less government supervision and regula-
tion of stock exchanges, brokers and listed companies than in the U.S. Politi-
cal factors may have an impact in the form of confiscatory taxation, expropri-
ation or political instability in international markets.
Although the Portfolio will seek the most favorable trading costs available
in any given market, investors should recognize that foreign commissions are
generally higher than those in the U.S. In addition, custodial expenses, that
is, fees paid to financial institutions for holding the Portfolio's securi-
ties, will generally be higher than would be the case in the U.S.
Some foreign governments also levy withholding taxes against dividend and
interest income. Although in some countries a portion of the taxes is recover-
able, the non-recovered portion of foreign withholding taxes will reduce the
income the Portfolio receives from the companies comprising its investments.
For additional information regarding foreign securities, please see the SAI.
RESTRICTED AND ILLIQUID SECURITIES
The Portfolio may purchase restricted securities that are not registered for
sale to the general public but which are eligible for resale to qualified in-
stitutional investors under Rule 144A of the Securities Act of 1933. Under the
supervision of the Fund's Board of Trustees, the Adviser determines the li-
quidity of such investments. Provided that a dealer or institutional trading
market in such securities exists, these restricted securities are not treated
as illiquid securities for purposes of the Portfolio's investment limitations.
The Portfolio may invest up to 15% of its net assets in illiquid securities.
The prices realized from the sales of these securities could be less than
those originally paid by the Portfolio or less than what may be considered the
fair value of such securities.
AMERICAN DEPOSITARY RECEIPTS
ADRs are depositary receipts typically used by a U.S. bank or trust company
which evidence ownership of underlying securities issued by a foreign corpora-
tion. Generally, ADRs in registered form are designed for use in the U.S. se-
curities market and ADRs in bearer form are designed for use in securities
markets outside the United States. ADRs may not necessarily be denominated in
the same currency as the underlying securities into which they may be convert-
ed. ADRs may be issued pursuant to sponsored or unsponsored programs. In spon-
sored programs, an issuer has made arrangements to have its securities traded
in the form of depositary receipts. In unsponsored programs, the issuer may
not be directly involved in the creation of the program. Although regulatory
requirements with respect to sponsored and unsponsored programs are generally
similar, in some cases it may be
11
<PAGE>
easier to obtain financial information from an issuer that has participated in
a sponsored program. Accordingly, there may be less information programs
available regarding issuers of securities underlying unsponsored programs and
there may not be a correlation between such information and the market value
of the depositary receipts. ADRs also involve the risks of other investments
in foreign securities, as discussed in the Prospectus. For purposes of the
Portfolio's investment policies, the Portfolio's investment in depositary re-
ceipts will be deemed to be investments in the underlying securities.
INVESTMENT LIMITATIONS
The Portfolio will not:
(a) with respect to 75% of its assets, invest more than 5% of its total
assets at the time of purchase in the securities of any single issuer
(other than investments issued or guaranteed by the U.S. Government or
any of its agencies or instrumentalities);
(b) with respect to 75% of its assets, purchase more than 10% of any class
of the outstanding voting securities of any one issuer;
(c) invest more than 5% of its assets at the time of purchase in the secu-
rities of companies that have (with predecessors) a continuous operat-
ing history of less than 3 years;
(d) invest more than 25% of its assets in companies within a single indus-
try; however, there are no limitations on investments made in instru-
ments issued or guaranteed by the U.S. Government and its agencies.
(e) make loans except by purchasing debt securities in accordance with its
investment objective and policies or entering into repurchase agree-
ments or by lending its portfolio securities to banks, brokers, deal-
ers and other financial institutions so long as the loans are made in
compliance with the 1940 Act, as amended, or the Rules and Regulations
or interpretations of the SEC;
(f) (i) borrow, except from banks and as a temporary measure for extraor-
dinary or emergency purposes and then, in no event, in excess of 33
1/3% of the Portfolio's gross assets valued at the lower of market or
cost, and (ii) the Portfolio may not purchase additional securities
when borrowings exceed 5% of total assets; or
(g) pledge, mortgage or hypothecate any of its assets to an extent greater
than 33 1/3% of its total assets at fair market value.
The Portfolio's investment objective and investment limitations (a), (b),
(d), (e) and (f)(i) listed above are fundamental policies and may be changed
only with the approval of the holders of a majority of the outstanding voting
securities of the Portfolio. The other investment limitations described here,
those not specified as fundamental in the SAI, and the Portfolio's investment
policies are not fundamental, and the Fund's Board of Trustees may change them
without shareholder approval.
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<PAGE>
PURCHASE OF SHARES
Shares of the Portfolio are offered through UAM Fund Distributors, Inc. (the
"Distributor") without a sales commission, at the net asset value per share
next determined after an order is received by the Fund and payment is received
by the Fund or its designated service agent. (See "VALUATION OF SHARES.") The
required minimum initial investment for the Portfolio is $2,500. The initial
investment minimum for IRA accounts is $500. The minimum for spousal IRA ac-
counts is $250. Certain exceptions may be permitted by the officers of the
Fund.
The Portfolio issues Service Class Shares, which bear shareholder servicing
expenses and distribution plan expenses, and have exclusive voting rights with
respect to the Rule 12b-1 Distribution Plan pursuant to which the distribution
fee may be paid. The net income attributable to Service Class Shares and the
dividends payable on Service Class Shares will be reduced by the amount of the
shareholder servicing and distribution fees; accordingly, the net asset value
of the Service Class Shares will be reduced by such amounts.
Some Service Agents may also impose additional or different conditions or
other account fees on the purchase and redemption of Portfolio shares, which
are not subject to the Rule 12b-1 Service and Distribution Plans. These may
include transaction fees and/or service fees paid by the Fund from the Portfo-
lio's assets attributable to the Service Agent and, would not be imposed if
shares of the Portfolio were purchased directly from the Fund or the Distribu-
tor. Service Agents may provide shareholder services to their customers that
are not available to a shareholder dealing directly with the Fund. Each Serv-
ice Agent is responsible for transmitting to its customers a schedule of any
such fees and information regarding any additional or different conditions re-
garding purchases and redemptions. Shareholders who are customers of Service
Agents should consult their Service Agent for information regarding these fees
and conditions. A salesperson and any other person entitled to receive compen-
sation for selling or servicing Portfolio shares may receive different compen-
sation with respect to one particular class of shares over another in the
Fund.
Service Agents or, if applicable, their designees, that have entered into
agreements with the Fund or its agent may enter confirmed purchase orders on
behalf of clients and customers, with payment to follow no later than a Port-
folio's pricing on the following business day. If payment is not received by
the Fund's Sub-Transfer Agent, Chase Global Funds Services Company ("CGFSC")
by such time, the Service Agent could be held liable for resulting fees or
losses. A Portfolio may be deemed to have received a purchase or redemption
order when a Service Agent, or, if applicable, its authorized designee, ac-
cepts the order. Orders received by the Fund in proper form will be priced at
the Portfolio's net asset value next computed after they are accepted by Serv-
ice Agent or its authorized designee. Service Agents are responsible to their
customers and the Fund for timely transmission of all
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<PAGE>
subscription and redemption requests, investment information, documentation
and money.
INITIAL INVESTMENT
BY MAIL
. Complete and sign an Application and mail it together with a check pay-
able to "UAM Funds" to:
UAM Funds Trust
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
Payment for purchases of shares received by mail will be credited to an ac-
count at the next share price calculated for the Portfolio after receipt. Pay-
ment does not need to be converted into Federal Funds (monies credited to the
Fund's Custodian Bank by a Federal Reserve Bank) before the Fund will accept
it for investment. The Fund will not accept third-party checks to purchase
shares of the Portfolio. If you purchase shares by check, please be sure that
your check is made payable to "UAM Funds."
BY WIRE
. Telephone the UAM Funds Service Center and provide the account name, ad-
dress, telephone number, social security or taxpayer identification num-
ber, Portfolio selected, amount being wired and the name of the bank
wiring the funds. The call must be received prior to the close of regu-
lar trading on the NYSE (generally 4:00 p.m. Eastern Time) to receive
that day's price. An account number and a wire control number will then
be provided to you. Next.
. Instruct the bank to wire a specified amount to the Fund's Custodian:
The Chase Manhattan Bank
ABA #021000021
UAM Funds
DDA Acct. #9102772952
Ref: Portfolio Name ______________
Your Account Number ______________
Your Account Name _______________
Wire Control Number ______________
(assigned by the UAM Funds Service Center)
. Forward a completed Application to the Fund at the address shown on the
form. Federal Funds purchases will be accepted only on a day on which
both the NYSE and the Custodian Bank are open for business.
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<PAGE>
. To be sure that a bank wire order is received on the same day it is
sent, an investor's bank should wire funds as early in the day as possi-
ble. The bank sending funds may charge for this service. The Fund's
agent reserves the right to charge investors for receipt of wired funds,
but no charge is currently imposed for this service. It is necessary to
obtain a new wire control number every time money is wired into an ac-
count in a Portfolio. Wire control numbers are effective for one trans-
action only and cannot be used more than once. Wired money that is not
properly identified with a currently effective wire control number will
be returned to the bank from which it was wired and will not be credited
to the shareholder's account.
ADDITIONAL INVESTMENTS
Additional investments can be made at any time. The minimum additional in-
vestment is $100. Shares can be purchased at net asset value by mailing a
check to the UAM Funds Service Center (payable to "UAM Funds") or by wiring
money to the Custodian Bank as outlined above. When making additional invest-
ments, be sure that the account number, account name and the Portfolio to be
purchased are identified on the check or wire. Prior to wiring additional in-
vestments, notify the UAM Funds Service Center by calling the number on the
cover of this Prospectus. Mail orders should include, when possible, the "In-
vest by Mail" stub which accompanies any Fund confirmation statement.
PURCHASE BY ACH
If you have made this election, shares of the Portfolio may be purchased via
the Automated Clearing House ("ACH"). Investors purchasing via ACH should com-
plete the bank information section on the Account Application and attach a
voided check or deposit slip to the Account Application. This option must be
established on your account at least 15 days prior to your initiating an ACH
transaction (see "SHAREHOLDER SERVICES -- AUTOMATIC INVESTMENT PLAN").
OTHER PURCHASE INFORMATION
Investments received by the close of regular trading on the NYSE (generally
4:00 p.m. Eastern Time) will be invested at the share price calculated after
the NYSE closes on that day. Investments received after the close of the NYSE
will be executed at the price computed on the next day the NYSE is open.
The Fund reserves the right, in its sole discretion, to suspend the offering
of shares or reject purchase orders of the Portfolio when, in the judgment of
management, such suspension or rejection is in the best interests of the Fund.
The Portfolio is intended to be a long-term investment vehicle and is not de-
signed to provide investors with a means of speculation on short-term market
movements. A pattern of frequent purchases can be disruptive to efficient
portfolio management and, consequently, can be detrimental to a Portfolio's
performance and its shareholders. Accordingly, if the Fund's management deter-
mines that an investor is engaged in
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<PAGE>
excessive trading, the Fund, with or without prior notice, may reject in whole
or part any purchase request with respect to such investor's account. Such in-
vestor also may be barred from purchasing other portfolios of the UAM Funds.
Purchases of shares will be made in full and fractional shares calculated to
three decimal places. Certificates for whole shares will not be issued except
at the written request of the shareholder. Certificates for fractional shares
will not be issued.
IN-KIND PURCHASES
If accepted by the Fund, shares of the Portfolio may be purchased in ex-
change for securities which are eligible for acquisition by the Portfolio, as
described in this Prospectus. Securities to be exchanged which are accepted by
the Fund will be valued as described under "VALUATION OF SHARES" at the next
determination of net asset value after acceptance. Shares issued by a Portfo-
lio in exchange for securities will be issued at net asset value determined as
of the same time. All dividends, interest, subscription, or other rights per-
taining to such securities shall become the property of the Portfolio and must
be delivered to the Fund by the investor upon receipt from the issuer. Securi-
ties acquired through an in-kind purchase will be acquired for investment and
not for immediate resale.
The Fund will not accept securities in exchange for shares of the Portfolio
unless:
. at the time of exchange, such securities are eligible to be in-
cluded in the Portfolio (current market quotations must be readily
available for such securities);
. the investor represents and agrees that all securities offered to
be exchanged are liquid securities and not subject to any restric-
tions upon their sale by the Portfolio under the Securities Act of
1933, or otherwise; and
. the value of any such securities (except U.S. Government securi-
ties) being exchanged together with other securities of the same
issuer owned by the Portfolio will not exceed 5% of the net assets
of the Portfolio immediately after the transaction.
Investors who are subject to federal taxation upon exchange may realize a
gain or loss for federal income tax purposes depending upon the cost of secu-
rities or local currency exchanged. Investors interested in such exchanges
should contact the Adviser.
REDEMPTION OF SHARES
Shares of each Portfolio may be redeemed by mail or telephone at any time,
without cost, at the net asset value of the Portfolio next determined after
receipt of the redemption request. No charge is made for redemptions. Any re-
demption may be more or less than the purchase price of the shares depending
on the market value of investment securities held by the Portfolio.
16
<PAGE>
BY MAIL
Address requests for redemption to the UAM Funds Service Center. Requests to
redeem shares must include:
. share certificates, if issued;
. a letter of instruction or an assignment specifying the number of
shares or dollar amount to be redeemed, signed by all registered
owners of the shares in the exact names in which they are regis-
tered;
. any required signature guarantees (see "SIGNATURE GUARANTEES"); and
. any other necessary legal documents, if required, in the case of
estates, trusts, guardianships, custodianships, corporations, pen-
sion and profit sharing plans and other organizations.
BY TELEPHONE
A redemption request by telephone requires the following:
. establish the telephone redemption privilege (and if desired, the
wire redemption privilege) by completing appropriate sections of
the Application; and
. call the Fund and instruct that the redemption proceeds be mailed
to you or wired to your bank.
The following tasks cannot be accomplished by telephone:
. changing the name of the commercial bank or the account designated
to receive redemption proceeds (this can be accomplished only by a
written request signed by each shareholder, with each signature
guaranteed); and
. redemption of certificated shares by telephone.
The Fund and its Sub-Transfer Agent will employ reasonable procedures to
confirm that instructions communicated by telephone are genuine, and they may
be liable for any losses if they fail to do so. These procedures include re-
quiring the investor to provide certain personal identification at the time an
account is opened, as well as prior to effecting each transaction requested by
telephone. All telephone transaction requests will be recorded and investors
may be required to provide additional telecopied written instructions of such
transaction requests. The Fund or Sub-Transfer Agent may be liable for any
losses due to unauthorized or fraudulent telephone instructions if the Fund or
the Sub-Transfer Agent does not employ the procedures described above. Neither
the Fund nor the Sub-Transfer Agent will be responsible for any loss, liabili-
ty, cost or expense for following instructions received by telephone that it
reasonably believes to be genuine.
17
<PAGE>
SIGNATURE GUARANTEES
Signature guarantees are required for the following redemptions:
. redemptions where the proceeds are to be sent to someone other than
the registered shareholder(s);
. redemptions where the proceeds are to be sent to an address which
is not the registered address; or
. share transfer requests.
Signature guarantees will be accepted from any eligible guarantor institu-
tion which participates in a signature guarantee program. Eligible signature
guarantors include most banks, as well as most brokers, dealers, credit
unions, national securities exchanges, registered securities associations,
clearing agencies and savings associations. Broker-dealers guaranteeing signa-
tures must be a member of a clearing corporation or maintain net capital of at
least $100,000. Credit unions must be authorized to issue signature guaran-
tees. A notary public can not provide a signature guarantee.
OTHER REDEMPTION INFORMATION
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the UAM Funds Service Center of a redemption request in
proper form. Although the Fund will redeem shares purchased by check before
the check clears, payment of the redemption proceeds may be delayed for a pe-
riod of up to fifteen days after their purchase, pending determination that
the check has cleared. Investors should consider purchasing shares using a
certified or bank check or money order if they anticipate an immediate need
for redemption proceeds. The Fund may suspend the right of redemption or post-
pone the date at times when both the NYSE and Custodian Bank are closed, or
under any emergency circumstances determined by the SEC.
If the Fund's Board of Trustees determines that it would be detrimental to
the best interests of the remaining shareholders of the Fund to make payments
wholly or partly in cash, the Fund may pay the redemption proceeds in whole or
in part by a distribution in-kind of liquid securities held by the Portfolio
instead of cash in conformity with applicable rules of the SEC. Investors may
incur brokerage charges when they sell portfolio securities received in pay-
ment of redemptions.
The Portfolio reserves the right to liquidate any account that is below
fifty percent of the required minimum initial investment amount for a Portfo-
lio as set forth in the Prospectus, where the reduction in value has occurred
due to a redemption or exchange out of the account. If at any time your total
investment does not have a value of at least fifty percent of the required
minimum initial investment amount, you may be notified that the value of your
account is below the Portfolio's minimum account balance requirement. You
would then be allowed 60 days to
18
<PAGE>
make an additional investment before the account is liquidated. Retirement ac-
counts and certain other accounts will not be subject to automatic liquida-
tion. Reductions in value that result solely from market activity will not
trigger an involuntary redemption.
SERVICE AND DISTRIBUTION PLANS
Under the Service Plan for Service Class Shares, the Fund may enter into
service agreements with Service Agents (broker-dealers or other financial in-
stitutions) who receive fees with respect to the Fund's Service Class Shares
owned by shareholders for whom the Service Agent is the dealer or holder of
record, or for whom the Service Agent performs personal services and/or share-
holder account maintenance. These fees are paid out of the assets allocable to
Service Class Shares to the Distributor, to the Service Agents directly, or
through the Distributor. The Fund reimburses the Distributor or the Service
Agent for payments made at an annual rate of up to .25 of 1% of the average
daily value of Service Class Shares. Each item for which a payment may be made
under the Service Plan constitutes personal service and/or shareholder account
maintenance and may constitute an expense of distributing Fund shares as the
SEC construes such term under Rule 12b-1. The fees payable for Servicing re-
flect actual expenses incurred up to the limit described herein.
Banks are engaged to act as Service Agents only to perform administrative
and shareholder servicing functions, including transaction-related agency
services for their customers. If a bank is prohibited from so acting, its
shareholder clients would be permitted to remain Fund shareholders and alter-
native means for continuing the servicing of such shareholders would be sought
and the shareholder clients of the bank would remain Fund shareholders.
The Distribution and Service Plans (the "Plans") provide generally that a
Portfolio may incur distribution and service costs under the Plans which may
not exceed in the aggregate 0.75% per annum of that Portfolio's net assets.
The Board has currently limited aggregate payments under the Plans up to 0.50%
per annum of the Portfolio's net assets. The Service Class Shares offered by
this Prospectus currently are not making payments under the Distribution Plan.
Upon implementation, the Distribution Plan would permit payments to the Dis-
tributor, broker-dealers, other financial institutions, sales representatives
or other third parties who render promotional and distribution services, for
items such as sales compensation and marketing and overhead expenses.
The Plans were adopted pursuant to Rule 12b-1 under the 1940 Act. Although
the Plans may be amended by the Board of Trustees, any changes in the Plans
which would materially increase the amounts authorized to be paid under the
Plans must be approved by shareholders of the Class involved. The Plans may be
terminated by the Board of Trustees or Service Class shareholders. The amounts
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<PAGE>
and purposes of expenditures under the Plans must be reported to the Board of
Trustees quarterly. The amounts allowable under the Plans for each Class of
Shares of the Portfolios are also limited under certain rules of the National
Association of Securities Dealers, Inc.
In addition to payments by the Fund under the Plans, the Distributor, United
Asset Management Corporation, the parent company of UAMFSI and of the Adviser,
the Adviser or any of their affiliates, may, at its own expense, compensate a
Service Agent or other person for marketing, shareholder servicing, record-
keeping and/or other services performed with respect to the Fund, the Portfo-
lio or any Class of Shares of the Portfolio. The person making such payments
may do so out of its revenues, its profits or any other source available to
it. Such service arrangements, when in effect, are made generally available to
all qualified service providers. The Adviser may compensate its affiliated
companies for referring investors to the Portfolio.
The Distributor, the Adviser and certain of their other affiliates also par-
ticipate, at the date of this Prospectus, in an arrangement with Smith Barney
Inc. under which Smith Barney provides certain defined contribution plan mar-
keting and shareholder services and receives from such entities an amount
equal to up to 33.3% of the portion of the investment advisory fees attribut-
able to the invested assets of Smith Barney's eligible customer accounts with-
out regard to any expense limitation in addition to amounts payable to all
selling dealers. The Fund also compensates Smith Barney for services it pro-
vides to certain defined contribution plan shareholders that are not otherwise
provided by UAMFSI.
SHAREHOLDER SERVICES
EXCHANGE PRIVILEGE
Service Class Shares of the Portfolio may be exchanged for Service Class
Shares of any other UAM Funds Portfolio. (See the list of Portfolios of the
UAM Funds at the end of this Prospectus.) Exchange requests should be made by
contacting the UAM Funds Service Center.
Any exchange will be based on the net asset value of the shares involved.
There is no sales commission or charge of any kind for an exchange. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. Call
the UAM Funds Service Center for a copy of the Prospectus for the Portfolio(s)
in which you are interested. Exchanges can only be made with Portfolios that
are qualified for sale in a shareholder's state of residence.
Exchange requests may be made either by mail or telephone. Telephone ex-
changes will be accepted only if the certificates for the shares to be ex-
changed have not been issued to the shareholder and if the registration of the
two accounts will
20
<PAGE>
be identical. Requests for exchanges received prior to the close of regular
trading on the NYSE (generally 4:00 p.m., Eastern Time) will be processed as
of the close of business on the same day. Requests received after the close of
regular trading on the NYSE will be processed on the next business day. The
Fund may modify or terminate the exchange program at any time upon 60 days'
written notice to shareholders, and may reject any exchange request. If the
Fund's management determines that an investor is engaged in excessive trading,
the Fund, with or without prior notice may reject in whole or part any ex-
change request, with respect to such investor's account. Such investors also
may be barred from exchanging into other portfolios of the UAM Funds. For ad-
ditional information regarding responsibility for the authenticity of tele-
phoned instructions, see "REDEMPTION OF SHARES BY TELEPHONE." An exchange into
another UAM Funds Portfolio is a sale of shares and may result in a gain or
loss for income tax purposes.
AUTOMATIC INVESTMENT PLAN
An Automatic Investment Plan permits shareholders of a Portfolio with a min-
imum value of $2,500 or more to purchase shares automatically (minimum of $100
per transaction) at regular intervals selected by the shareholder. Provided
the shareholder's bank or other financial institution allows automatic with-
drawals, shares are purchased by transferring funds via the Automated Clearing
House ("ACH"). Investments made through ACH will be automatically transferred
from a shareholder's checking, bank money market or NOW account designated by
the shareholder. Such withdrawals are made electronically, if the sharehold-
er's bank or financial institution so permits, or be pre-authorized checks or
drafts drawn on the shareholder's bank or other account. The bank or financial
institution must be a member of ACH. At the shareholder's option, the account
designated will be debited in the specified amount, and shares will be pur-
chased monthly or quarterly.
To establish an Automatic Investment Plan, a shareholder must complete the
Optional Services Form available from the UAM Funds Service Center at 1-800-
638-7983 and mail it to Chase Global Funds Service Company. A shareholder may
cancel his/her participation or change the amount of purchase at any time by
mailing written notification to Chase Global Funds Services Company, P.O. Box
2798, Boston, MA 02208-2798. Notification generally will be effective three
business days following receipt. The Fund may modify or terminate this privi-
lege at any time, or may charge a service fee, although no such fee currently
is contemplated.
SYSTEMATIC WITHDRAWAL PLAN
Any shareholder whose account balance totals at least $10,000 may establish
a Systematic Withdrawal Plan under which an amount pre-determined by the
shareholder (but at least $100) is automatically redeemed from the sharehold-
er's account either monthly or quarterly. A shareholder may participate in the
Systematic Withdrawal Plan by using ACH. Redemptions made through ACH will be
automatically transferred to the shareholder's bank or other similar financial
institution account
21
<PAGE>
or a properly designated third party. The bank or financial institution must
be a member of ACH. Redemptions ordinarily are made on the third business day
of the month and payments ordinarily will be transmitted within five business
days after the redemption date. Because the prices of Fund shares fluctuate,
the number of shares redeemed to finance systematic withdrawal payments or a
given amount will vary from payment to payment. If a shareholder owns shares
in more than one Portfolio, the shareholder must designate the Portfolio from
which the redemptions under a Systematic Withdrawal Plan should be made. An
additional sheet may be attached to the Optional Services Form if a share-
holder selects more than one Portfolio. A Systematic Withdrawal Plan may be
terminated or suspended at any time by the Fund. A shareholder may elect at
any time, in writing, to terminate participation in the Systematic Withdrawal
Plan. Such written election must be sent to and received by the Fund before a
termination becomes effective. There is currently no charge to the shareholder
for a Systematic Withdrawal Plan.
VALUATION OF SHARES
The net asset value of each class of a Portfolio is determined by dividing
the value of the Portfolio's assets attributable to the class, less any lia-
bilities attributable to the class, by the number of shares outstanding at-
tributable to the class. The net asset value per share of the Portfolio is de-
termined as of the close of the NYSE on each day that the NYSE is open for
business.
Equity securities listed on a securities exchange for which market quota-
tions are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed secu-
rities not traded on the valuation date for which market quotations are read-
ily available are valued neither exceeding the current ask prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is
based upon the bid price of the foreign currency against U.S. dollars quoted
by any major bank or by a broker.
Securities purchased with remaining maturities of 60 days or less are valued
at amortized cost when the Board of Trustees determines that amortized cost
reflects fair value.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at
fair value using methods determined by the Fund's Board of Trustees.
PERFORMANCE CALCULATIONS
The Portfolio measures performance by calculating yield and total return.
Both yield and total return figures are based on historical earnings and are
not intended to indicate future performance. Yield and total return are calcu-
lated separately for each class of a portfolio.
22
<PAGE>
Yield refers to the income generated by an investment in the Portfolio over
a given period of time, expressed as an annual percentage rate. Yields are
calculated according to a standard that is required for all funds. As this
differs from other accounting methods, the quoted yield may not equal the in-
come actually paid to shareholders.
Total return is the change in value of an investment in the Portfolio over a
given period, assuming reinvestment of any dividends and capital gains. A cu-
mulative or aggregate total return reflects actual performance over a stated
period of time. An average annual total return is a hypothetical rate of re-
turn that, if achieved annually, would have produced the same cumulative total
return if performance had been constant over the entire period.
Performance will be calculated separately for Institutional Class and Serv-
ice Class Shares. Dividends paid by the Portfolio with respect to Institu-
tional Class and Service Class Shares, to the extent any dividends are paid,
will be calculated in the same manner at the same time on the same day and
will be in the same amount, except that service fees, distribution charges and
any incremental transfer agency costs relating to Service Class Shares will be
borne exclusively by that class.
The Portfolio's performance may be compared to data prepared by independent
services which monitor the performance of investment companies, data reported
in financial and industry publications, and various indices as further de-
scribed in the Portfolio's SAI. This information may also be included in sales
literature and advertising.
The Portfolio's Annual Report to Shareholders for the most recent fiscal
year end contains additional performance information that includes comparisons
with appropriate indices. The Annual Report is available without charge. Con-
tact the UAM Funds Service Center at the telephone number on the cover of this
Prospectus.
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES
DIVIDENDS AND CAPITAL GAINS
The Portfolio will normally distribute substantially all of its net invest-
ment income (for tax purposes) to shareholders in quarterly dividends. If any
net capital gains are realized, each Portfolio will normally distribute them
annually. All dividends and capital gains distributions will be automatically
reinvested in additional shares of the Portfolio unless the Fund is notified
in writing that the shareholder elects to receive distributions in cash.
FEDERAL TAXES
The Portfolio intends to qualify as a "regulated investment company" under
subchapter M of the Internal Revenue Code of 1986, as amended, for federal in-
come tax purposes and to meet all other requirements that are necessary for it
23
<PAGE>
(but not its shareholders) to be exempt from federal taxes on income and gains
paid to shareholders in the form of dividends. To do this, the Portfolio must,
among other things, distribute substantially all of its ordinary income and
net capital gains on an annual basis and maintain a portfolio of investments
which satisfies certain diversification criteria.
Dividends paid by the Portfolio from net investment income, whether in cash
or reinvested in shares, are taxable to shareholders as ordinary income.
Short-term capital gains will be taxed as ordinary income. Long-term capital
gains distributions are taxed as long-term capital gains. Shareholders will be
notified annually of dividend income earned for tax purposes.
Dividends declared in October, November and December to shareholders of rec-
ord in such a month and paid in January of the following year will be treated
as if they had been paid by the Fund and received by the shareholders on De-
cember 31.
The Fund is required by federal law to withhold 31% of reportable payments
paid to shareholders who have not complied with IRS regulations. In order to
avoid this withholding requirement, you must certify that your Social Security
or Taxpayer Identification Number you have provided is correct and that either
you are not currently subject to backup withholding or you are exempt from
backup withholding. This certification must be made on the Application or on a
separate form supplied by the Fund.
Dividends and interest received by the Portfolio may give rise to withhold-
ing and other taxes imposed by foreign countries. These taxes reduce the Port-
folio's dividends but are included in the taxable income reported on your tax
statement if the Portfolio qualifies for this tax treatment and elects to pass
it through to you. Consult a tax adviser for more information regarding deduc-
tions and credits for foreign taxes.
INVESTMENT ADVISER
The Adviser is a registered investment adviser formed in 1983 with business
offices located at Two Leadership Square, 211 North Robinson, Suite 450, Okla-
homa City, Oklahoma. It is a wholly-owned subsidiary of United Asset Manage-
ment Corporation ("UAM") and provides and offers investment management and ad-
visory services to corporations, unions, pensions and profit-sharing plans,
trusts, estates and other institutions and investors. The Adviser currently
has approximately $2.4 billion in assets under management.
The Portfolio pays an annual fee in monthly installments to the Adviser for
advisory services. This fee is calculated every month as a percentage of the
average net assets in the Portfolio for that month. The percentage fee on an
annual basis is 0.75%. The Adviser and certain other service providers have
agreed to waive all or a portion of their advisory fee and to assume certain
operating expenses of the Portfolio to keep the Portfolio's total operating
expenses from exceeding 1.25% of average daily net assets through January 1,
2000.
24
<PAGE>
The Adviser may compensate its affiliated companies for referring investors
to the Portfolio. The Distributor, UAM, the Adviser or any of their affiliates
may, at their own expense, compensate a Service Agent or other person for mar-
keting, shareholder servicing, recordkeeping and/or other services performed
with respect to the Fund, the Portfolio or any Class of Shares of the Portfo-
lio. The person making such payments may do so out of its revenues, its prof-
its or any other source available to it. Such service arrangements, when in
effect, are made generally available to all qualified service providers.
The investment professionals at the Adviser who are responsible for the day-
to-day management of the Portfolio and their qualifications are as follows:
THOMAS E. JOHNSON, CFA, CHAIRMAN & CHIEF INVESTMENT OFFICER, SENIOR PORTFO-
LIO MANAGER -- Texas Tech University, B.B.A., 1963; Texas Tech University,
M.B.A., 1964; President and Senior Portfolio Manager, Tom Johnson Investment
Management, Inc., 1983-Present.
JERRY L. WISE, CFA, CPA, PRESIDENT AND CHIEF EXECUTIVE OFFICER, SENIOR PORT-
FOLIO MANAGER -- Oklahoma University, B.B.A., 1978; Oklahoma University,
M.B.A., 1984; Executive Vice President and Senior Portfolio Manager, Tom John-
son Investment Management, Inc., 1986-Present.
RICHARD H. PARRY, CFA, SENIOR VICE PRESIDENT, SENIOR PORTFOLIO MANAGER --
University of Colorado, B.S., 1979; Oklahoma City University, M.B.A., 1983;
Vice President and Senior Portfolio Manager, Tom Johnson Investment Manage-
ment, Inc., 1989-Present; Registered Representative, UAM Fund Distributors,
Inc., October 1997-Present.
JAMES R. MCGLYNN, CFA, VICE PRESIDENT, PORTFOLIO MANAGER -- University of
Texas at Austin, B.B.A., 1980; Portfolio Manager, Tom Johnson Investment Man-
agement, Inc., 1991-Present.
THOMAS A. GILES, CFA, ASSISTANT VICE PRESIDENT, PORTFOLIO MANAGER -- Univer-
sity of Texas, B.B.A., 1979; University of Texas, M.B.A., 1982; Portfolio Man-
ager, Tom Johnson Investment Management, Inc., 1989-Present.
JOHN A. SHEPLEY, CFA, ASSISTANT VICE PRESIDENT, PORTFOLIO MANAGER -- Mid-
western State University, B.B.A., 1982; Oklahoma City University, M.B.A.,
1994; Portfolio Manager, Tom Johnson Investment Management, Inc., 1990-
Present.
EDWARD L. (NED) SCHREMS, PH.D, CFA, ASSISTANT VICE PRESIDENT, PORTFOLIO MAN-
AGER -- Michigan State University, B.A., 1967; Michigan State University,
M.B.A., 1968; Stanford University, M.S., 1972; Stanford University, Ph.D.,
1973; Senior Portfolio Manager and Director of Equity Investments, Liberty Na-
tional Bank and Trust Company and its successor, Bank One of Oklahoma City,
June, 1992-March, 1998; Portfolio Manager, Tom Johnson Investment Management,
Inc., March, 1998-Present.
25
<PAGE>
DOUGLAS A. HAWS, CFA, INVESTMENT OFFICER, PORTFOLIO MANAGER --University of
Oklahoma, B.B.A., 1993; Internal Auditor, Union Pacific Corporation, May,
1993-October, 1994; Portfolio Manager, Tom Johnson Investment Management,
Inc., October, 1994-Present; Registered Representative, UAM Fund Distributors,
Inc., October, 1997-Present.
ADMINISTRATIVE SERVICES
UAM Fund Services, Inc. ("UAMFSI"), a wholly-owned subsidiary of UAM is re-
sponsible for performing and overseeing administrative, fund accounting, divi-
dend disbursing and transfer agent services provided to the Fund and its Port-
folios. UAMFSI's principal office is located at 211 Congress Street, Boston,
MA 02110. UAMFSI has subcontracted some of these services to Chase Global
Funds Services Company ("CGFSC"), an affiliate of The Chase Manhattan Bank, by
a Mutual Funds Service Agreement dated June 30, 1997. CGFSC is located at 73
Tremont Street, Boston, MA 02108.
Each Portfolio pays UAMFSI a two part monthly fee: a Portfolio-specific fee
which is retained by UAMFSI and a sub-administration fee which UAMFSI in turn
pays to CGFSC. The following Portfolio-specific fees are calculated from the
aggregate net assets of the Portfolio:
<TABLE>
<CAPTION>
RATE
----
<S> <C>
TJ Core Equity Portfolio............................................... 0.04%
</TABLE>
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined UAM Fund assets;
0.11 of 1% of the next $800 million of combined UAM Fund assets;
0.07 of 1% of combined UAM Fund assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined UAM Fund assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their rela-
tive assets and are subject to a graduated minimum fee schedule per Portfolio,
which starts at $2,000 per month and increases to $70,000 annually after two
years. If a separate class of shares is added to a Portfolio, its minimum an-
nual fee increases by $20,000.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM with its prin-
cipal office located at 211 Congress Street, Boston, Massachusetts 02110, dis-
tributes the shares of the Fund. Under the Fund's Distribution Agreement (the
"Agreement"), the Distributor, as agent of the Fund, agrees to use its best
efforts as sole distributor of the Fund's shares. The Distributor does not re-
ceive any fee or
26
<PAGE>
other compensation under the Agreement (except as described under "SERVICE AND
DISTRIBUTION PLANS" above). The Agreement continues in effect as long as such
continuance is approved at least annually by the Fund's Board of Trustees.
Those approving the Agreement must include a majority of Trustees who are nei-
ther parties to such Agreement, nor interested persons of any such party. The
Agreement provides that the Fund will bear the costs of the registration of
its shares with the SEC and various states and the printing of its prospectus-
es, its SAIs and its reports to shareholders.
PORTFOLIO TRANSACTIONS
The Advisory Agreement authorizes the Adviser to select the brokers or deal-
ers that will execute the purchase and sale of investment securities for the
Portfolio. The Agreement directs the Adviser to use its best efforts to obtain
the best available price and most favorable execution for all transactions of
the Portfolios. If consistent with the interests of the Portfolio, the Adviser
may select brokers on the basis of the research, statistical and pricing serv-
ices they provide to each Portfolio in addition to required services. Such
brokers may be paid a higher commission than that which another qualified bro-
ker would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934,
as amended, and that the Adviser determines in good faith that such commission
is reasonable in terms either of the transaction or the overall responsibility
of the Adviser to a Portfolio and the Adviser's other clients.
Although not a typical practice, the Adviser may place portfolio orders with
qualified broker-dealers who refer clients to the Adviser.
If a purchase or sale of securities consistent with the investment policies
of a Portfolio and one or more of these other clients served by the Adviser is
considered at or about the same time, transactions in such securities will be
allocated among the Portfolio and clients in a manner deemed fair and reason-
able by the Adviser. Although there is no specified formula for allocating
such transactions, such allocations are subject to periodic review by the
Fund's Trustees.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized as a Delaware business trust on May 18, 1994 under
the name "The Regis Fund II." On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's Agreement and Declaration of Trust
permits the Fund to issue an unlimited number of shares of beneficial inter-
est, without par value. The Trustees have the power to designate one or more
series ("Portfolios") or classes of shares of beneficial interest without fur-
ther action by shareholders.
27
<PAGE>
At its discretion, the Board of Trustees may create additional Portfolios
and classes of shares. The shares of each Portfolio are fully paid and nonas-
sessable, and have no preference as to conversion, exchange, dividends, re-
tirement or other features and no pre-emptive rights. They have noncumulative
voting rights, which means that holders of more than 50% of shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do
so. A shareholder is entitled to one vote for each full share held (and a
fractional vote for each fractional share held), then standing in his or her
name on the books of the Fund.
As of June 15, 1998, Wilmington Trust Co., Trustee, FBO Allied Waste 401K
Plan, held of record 34.4% of the outstanding shares of the Portfolio's Serv-
ice Class for which beneficial ownership is disclaimed or presumed disclaimed.
The persons or organizations owning 25% or more of the outstanding shares of a
Portfolio may be presumed to "control" (as that term is defined in the 1940
Act) such Portfolio. As a result, those persons or organizations could have
the ability to vote a majority of the shares of the Portfolio on any matter
requiring the approval of shareholders of such Portfolio.
Annual meetings will not be held except as required by the 1940 Act and
other applicable laws. The Fund has undertaken that its Trustees will call a
meeting of shareholders if such a meeting is requested in writing by the hold-
ers of not less than 10% of the outstanding shares of the Fund. The Fund will
assist shareholder communications in such matters.
CUSTODIAN
The Chase Manhattan Bank serves as custodian of the Fund's assets.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the independent accountant for the
Fund.
REPORTS
Investors will receive unaudited semi-annual financial statements and annual
financial statements audited by PricewaterhouseCoopers LLP.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be made by contacting the UAM Funds Service Center
at the telephone number listed on the cover page of the Prospectus.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE PORTFOLIO'S STATEMENT
OF ADDITIONAL INFORMATION, IN CONNECTION WITH THE OFFERING MADE BY THIS PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR ITS REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFERING BY THE FUND IN ANY JURISDICTION IN WHICH SUCH OF-
FERING MAY NOT BE LAWFULLY MADE.
28
<PAGE>
UAM FUNDS -- INSTITUTIONAL SERVICE CLASS SHARES
BHM&S Total Return Bond Portfolio
DSI Disciplined Value Portfolio
FMA Small Company Portfolio
FPA Crescent Portfolio
MJI International Equity Portfolio
NWQ Balanced Portfolio
NWQ Small Cap Value Portfolio
NWQ Special Equity Portfolio
NWQ Value Equity Portfolio
Sirach Bond Portfolio
Sirach Equity Portfolio
Sirach Growth Portfolio
Sirach Special Equity Portfolio
Sirach Strategic Balanced Portfolio
Sterling Partners' Balanced Portfolio
Sterling Partners' Equity Portfolio
Sterling Partners' Small Cap Value Portfolio
TJ Core Equity Portfolio
29
<PAGE>
UAM Funds Service Center
c/o Chase Global Funds Services Company
P.O. Box 2798
Boston, MA 02208-2798
1-800-638-7983
Investment Adviser
Tom Johnson Investment Management, Inc.
Two Leadership Square, 211 North Robinson,
Suite 450,
Oklahoma City, OK 73102
Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110
PROSPECTUS
July 17, 1998
<PAGE>
PART B
UAM FUNDS
BHM&S TOTAL RETURN BOND PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectus of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the BHM&S Total Return Bond Portfolio (the
"Portfolio") dated July 17, 1998 relating to the Institutional Class Shares, and
the Prospectus dated July 17, 1998 relating to the Institutional Service Class
Shares (the "Service Class Shares"). To obtain a Prospectus, please call the UAM
Funds Service Center at 1-800-638-7983.
TABLE OF CONTENTS
INVESTMENT OBJECTIVE AND POLICIES....................................... 2
PURCHASE AND REDEMPTION OF SHARES....................................... 3
VALUATION OF SHARES..................................................... 4
SHAREHOLDER SERVICES.................................................... 4
INVESTMENT LIMITATIONS.................................................. 5
MANAGEMENT OF THE FUND.................................................. 6
INVESTMENT ADVISER...................................................... 9
SERVICE AND DISTRIBUTION PLANS.......................................... 10
PORTFOLIO TRANSACTIONS.................................................. 12
ADMINISTRATIVE SERVICES................................................. 13
CUSTODIAN............................................................... 14
INDEPENDENT ACCOUNTANTS................................................. 14
DISTRIBUTOR............................................................. 14
PERFORMANCE CALCULATIONS................................................ 15
GENERAL INFORMATION..................................................... 16
FINANCIAL STATEMENTS.................................................... 17
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS..................... A-1
APPENDIX B - COMPARISONS................................................ B-1
Investment Adviser
Barrow, Hanley, Mewhinney & Strauss, Inc. (Adviser)
Distributor
UAM Fund Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment objective
and policies of the Portfolio as set forth in the Portfolio's Prospectuses for
the Institutional Class Shares and Service Class Shares.
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest bearing short-term investments). The Portfolio
will not loan securities to the extent that greater than one-third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as discussed in the Prospectus.
OPTIONS AND FUTURES TRANSACTIONS
As indicated in the Prospectuses, to the extent consistent with its investment
objectives and policies, the Portfolio may purchase and write call and put
options on securities, securities indexes and on foreign currencies and enter
into futures contracts and use options on futures contracts, to the extent of up
to 5% of its assets.
Transactions in options on securities and on indexes involve certain risks.
For example, there are significant differences between the securities and
options markets that could result in an imperfect correlation between these
markets, causing a given transaction not to achieve its objectives. A decision
as to whether, when and how to use options involves the exercise of skill and
judgment, and even a well-conceived transaction may be unsuccessful to some
degree because of market behavior or unexpected events.
There can be no assurance that a liquid market will exist when the Portfolio
seeks to close out an option position. If the Portfolio were unable to close out
an option that it had purchased on a security, it would have to exercise the
option in order to realize any profit or the option may expire worthless. If the
Portfolio were unable to close out a covered call option that it had written on
a security, it would not be able to sell the underlying security unless the
option expired without exercise. As the writer of a covered call option, the
Portfolio forgoes, during the option's life, the opportunity to profit from
increases in the market value of the security covering the call option above the
sum of the premium and the exercise price of the call.
If trading were suspended in an option purchased by the Portfolio, the
Portfolio would not be able to close out the option. If restrictions on exercise
were imposed, the Portfolio might be unable to exercise an option it has
purchased. Except to the extent that a call option on an index written by the
Portfolio is covered by an option on the same index purchased by the Portfolio,
movements in the index may result in a loss to the Portfolio; such losses may be
mitigated or exacerbated by changes in the value of the Portfolio's securities
during the period the option was outstanding.
Use of futures contracts and options thereon also involves certain risks. The
variable degree of correlation between price movements of futures contracts and
price movements in the related portfolio positions of the Portfolio creates the
possibility that losses on the hedging instrument may be greater than
2
<PAGE>
gains in the value of the Portfolio's position. Also, futures and options
markets may not be liquid in all circumstances and certain over-the-counter
options may have no markets. As a result, in certain markets, the Portfolio
might not be able to close out a transaction at all or without incurring losses.
Although the use of options and futures transactions for hedging should minimize
the risk of loss due to a decline in the value of the hedged position, at the
same time it tends to limit any potential gain which might result from an
increase in the value of such position. If losses were to result from the use of
such transactions, they could reduce net asset value and possibly income. The
Portfolio may use these techniques to hedge against changes in interest rates or
securities prices or as part of its overall investment strategy. The Portfolio
will maintain segregated accounts consisting of cash or liquid securities (or,
as permitted by applicable regulation, enter into certain offsetting positions)
to cover its obligations under options and futures contracts to avoid leveraging
of the Portfolio.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectuses is calculated by
dividing the lesser of purchases or sales of portfolio securities for the year
by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of acquisition were one year or less. Portfolio turnover may vary greatly
from year to year as well as within a particular year, and may also be affected
by cash requirements for redemptions of shares. See "Financial Highlights" in
the Prospectuses for the historical portfolio turnover rates with respect to the
Portfolios.
PURCHASE AND REDEMPTION OF SHARES
Both Classes of shares of the Portfolio may be purchased without a sales
commission at their net asset value per share next determined after an order is
received in proper form by the Fund, and payment is received by the Fund or its
designated Service Agent. The minimum initial investment required for the
Portfolio is $2,500, with certain exceptions as may be permitted from time to
time by the officers of the Fund. Other investment minimums are: initial IRA
investment, $500; initial spousal IRA investments $250; and additional
investment for all accounts, $100. An order received in proper form prior to
the close of regular trading on the New York Stock Exchange (the "Exchange")
(generally 4:00 p.m. Eastern time) will be executed at the price computed on the
date of receipt; and an order received not in proper form or after the close of
the Exchange will be executed at the price computed on the next day the Exchange
is open after proper receipt. The Exchange will be closed on the following days:
New Year's Day, Dr. Martin Luther King, Jr.'s Birthday, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.
The Portfolio reserves the right in its sole discretion (1) to suspend the
offering of its shares, (2) to reject purchase orders when in the judgment of
management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of a Portfolio's shares.
The Portfolio may suspend redemption privileges or postpone the date of
payment (1) during any period that either the Exchange and custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for a Portfolio to dispose of
securities owned by it or to fairly determine the value of its assets, and (3)
for such other periods as the SEC may permit. The Fund has made an election with
the SEC to pay in cash all redemptions requested by any shareholder of record
limited in amount during any 90-day period to the lesser of $250,000 or 1% of
the net assets of the Fund at the beginning of such period. Such commitment is
irrevocable without the prior approval of the SEC. Redemptions in excess of the
above limits may be paid, in whole or in part, in investment securities or in
cash as the Board of Trustees may deem advisable; however, payment will be made
wholly in cash unless the Board of Trustees believe that economic or market
conditions exist which would make such a practice detrimental to the best
interests of the Fund. If redemptions are paid in investment securities, such
securities will be valued as set forth in each Prospectus under
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<PAGE>
"VALUATION OF SHARES," and a redeeming shareholder would normally incur
brokerage expenses if he converted those securities to cash.
No charge is made by a Portfolio for redemptions. Any redemption may be more
or less than the shareholder's initial cost depending on the market value of the
securities held by the Portfolio.
SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services Company
("CGFSC") from fraud, signature guarantees are required for certain redemptions.
The purpose of the signature guarantees is to verify the identity of the person
who has authorized a redemption from your account. Signature guarantees are
required for (1) all redemptions when the proceeds are to be paid to someone
other than the registered owner(s) and/or the registered address, or (2) share
transfer requests.
Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the Fund's transfer agent. Broker-dealers guaranteeing
signatures must be a member of a clearing corporation or maintain net capital of
at least $100,000. Credit unions must be authorized to issue signature
guarantees. Signature guarantees will be accepted from any eligible guarantor
institution which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request for
redemption; (2) on a separate instrument for assignment ("stock power") which
should specify the total number of shares to be redeemed; or (3) on all stock
certificates tendered for redemption and, if shares held by the Fund are also
being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market quotations
are readily available are valued at the last quoted sale price of the day.
Price information on listed securities is taken from the exchange where the
security is primarily traded. Unlisted equity securities and listed securities
not traded on the valuation dated for which market quotations are readily
available are valued neither exceeding the current asked prices not less than
the current bid prices. Quotations of foreign securities in a foreign currency
are converted to U.S. dollar equivalents. The converted value is based upon the
bid price of the foreign currency against U.S. dollars as quoted by any major
bank or broker.
Bonds and other fixed income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed income securities may be value on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities. Securities purchased with remaining
maturities of 60 days or less are valued at amortized cost, using methods
approved by the Board of Trustees.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at fair
value using methods determined by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectuses.
EXCHANGE PRIVILEGE
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<PAGE>
Institutional Class Shares of the BHM&S Total Return Bond Portfolio may be
exchanged for Institutional Class Shares of any other UAM Funds or UAM Funds,
Inc. Portfolio. Likewise, Service Class Shares of the BHM&S Total Return Bond
Portfolio may be exchanged for Service Class Shares of any other UAM Funds or
UAM Funds, Inc. Portfolio. Exchange requests should be made by calling the Fund
(1-800-638-7983) or by writing to UAM Funds, UAM Funds Service Center, c/o Chase
Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
exchange privilege is only available with respect to Portfolios that are
qualified for sale in the shareholder's state of residence.
Any such exchange will be based on the respective net asset values of the
shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objective of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the shares
to be exchanged have not been issued to the shareholder, and if the registration
of the two accounts will be identical. Requests for exchanges received prior to
the close of regular trading of the Exchange (generally 4:00 p.m. Eastern Time)
will be processed as of the close of business on the same day. Requests
received after the close of regular trading on the Exchange will be processed on
the next business day. Neither the Fund nor CGFSC will be responsible for the
authenticity of the exchange instructions received by telephone. Exchanges may
also be subject to limitations as to amounts or frequency and to other
restrictions established by the Board of Trustees to assure that such exchanges
do not disadvantage the Fund and its shareholders.
For federal income tax purposes an exchange between Portfolios is a taxable
event, and, accordingly, a capital gain or loss may be realized. In a revenue
ruling relating to circumstances similar to the Fund's, an exchange between
series of a Fund was also deemed to be a taxable event. It is likely, therefore,
that a capital gain or loss would be realized on an exchange between Portfolios;
you may want to consult your tax adviser for further information in this regard.
The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares to another person by making a written request
to the Fund. The request should clearly identify the account and number of
shares to be transferred, and include the signature of all registered owners and
all stock certificates, if any, which are subject to the transfer. The signature
on the letter of request, the stock certificate or any stock power must be
guaranteed in the same manner as described under "Purchase and Redemption of
Shares." As in the case of redemptions, the written request must be received in
good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in each Prospectus of the
Portfolio. A Portfolio's fundamental investment limitations cannot be changed
without the approval of a "majority of the outstanding shares" (as defined in
the 1940 Act) of the Portfolio. Except for the numbered investment limitations
noted as fundamental below, however, the limitations described below are not
fundamental, and may be changed without the consent of shareholders. Whenever
an investment limitation sets forth a percentage limitation on investment or
utilization of assets, such limitation shall be determined immediately after and
as a result of a Portfolio's acquisition of such security or other asset.
Accordingly, any later increase or decrease resulting from a change in values,
net assets or other circumstances will not be considered when determining
whether the investment complies with a Portfolio's investment limitations.
As a matter of fundamental policy, the Portfolio will not:
5
<PAGE>
(1) invest in physical commodities or contracts on physical commodities;
(2) purchase or sell real estate or real estate limited partnerships, although
it may purchase and sell securities of companies which deal in real estate
and may purchase and sell securities which are secured by interests in real
estate;
(3) make loans except (i) by purchasing debt securities in accordance with its
investment objectives and (ii) by lending its portfolio securities to
banks, brokers, dealers and other financial institutions so long as such
loans are not inconsistent with the 1940 Act or the rules and regulations
or interpretations of the SEC thereunder;
(4) underwrite the securities of other issuers; and
(5) issue senior securities, as defined in the 1940 Act, except that this
restriction shall not be deemed to prohibit the Portfolio from (i) making
any permitted borrowings, mortgages or pledges, or (ii) entering into
repurchase transactions.
As a matter of non-fundamental policy, the Portfolio will not:
(1) purchase on margin or sell short except that the Portfolio may purchase
futures as described in the Prospectus and this Statement of Additional
Information;
(2) invest more than an aggregate of 15% of the net assets of the Portfolio,
determined at the time of investment, in securities subject to legal or
contractual restrictions on resale or securities for which there are no
readily available markets; and
(3) invest for the purpose of exercising control over management of any
company.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are responsible
to the Fund's Board of Trustees. The Trustees set broad policies for the Fund
and elect its Officers. The following is a list of the Trustees and Officers of
the Fund, their addresses and dates of birth, and a brief statement of their
present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
6
<PAGE>
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated person, a
$150 quarterly retainer fee per active Portfolio which currently amounts to
$1,350 per quarter. In addition, each unaffiliated Trustee receives a $2,000
meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management Corporation ("UAM"), or
the Administrator and receive no compensation from the Fund. As of June 15,
1998, the Trustees and officers of the Fund owned less than 1% of the Fund's
outstanding shares.
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<PAGE>
The following table shows aggregate compensation paid to each of the Fund's
Trustees by the Fund and total compensation paid by the Funds and UAM Funds,
Inc. (collectively the "Fund Complex") in the fiscal year ended April 30,
1998.
8
<PAGE>
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Aggregate Benefits Accrued Annual from Registrant
Name of Person, Compensation From as Part of Benefits Upon and
Position Registrant Fund Expenses Retirement Fund Complex
-------- ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee............. $6,149 0 0 $33,500
Philip D. English
Trustee............. $6,149 0 0 $33,500
William A.Humenuk
Trustee............. $6,149 0 0 $33,500
Nancy J. Dunn
Trustee............. $4,668 0 0 $25,200
Peter M. Whitman, Jr.
Trustee $ 0 0 0 $ 0
Norton H. Reamer
Trustee............. $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of
record or beneficially 5% or more of the shares of the Portfolio:
BHM&S Total Return Bond Portfolio Institutional Class Shares: Fleet
National Bank, Trustee, FBO Austin Diagnostic Clinic Associates 401K Profit
Sharing Plan 00050211170, P.O. Box 92800, Rochester, NY, 28.1%*; Sarah Campbell
Blaffer Foundation, Texas Commerce Bank, P.O. Box 2558 10TCT 315, Houston, TX,
18.0%; Hartnat & Co., Barrow Hanley, P.O. Box 92800, Rochester, NY, 16.7%*;
Wilmington Trust Co., Trustee, FBO FIGGIE Institutional Investor Retirement &
Profit SA Trust, Supp. Retirement SVS. & Trust 401K Plan, CLF 436260, c/o Mutual
Funds, 1100 N. Market St., Wilmington, DE, 12.5%*; Fleet National Bank, Trustee,
FBO Austin Diagnostic Clinic 401K Profit Sharing Conservative Coll., P.O. Box
92800, Rochester, NY, 6.8%*; and Wilmington Trust Co., Trustee, FBO FIGGIE
Institutional Investor Retirement & Profit Sharing Trust, Supp. SVS & Trust 401K
Plan, MLF, c/o Mutual Funds, 1100 N. Market St., Wilmington, DE, 5.6%*.
BHM&S Total Return Bond Portfolio Service Class Shares: Wilmington
Trust Co., Trustee, FBO Hoag Sheltered Savings Plan, c/o Mutual Funds, 1100
North Market Street, Wilmington, DE, 24.5%*; Wilmington Trust Co., Trustee, FBO
Hoag Sheltered Savings Plan, c/o Mutual Funds, 1100 North Market Street,
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<PAGE>
Wilmington, DE, 23.5%*; Wilmington Trust Co., Trustee, FBO Allied Waste 401K
Plan, c/o Mutual Funds, 1100 North Market Street, Wilmington, DE, 18.1%*;
Hartnat & Co., North Texas, P.O. Box 92800, Rochester, NY, 10.2%*; and
Wilmington Trust Co., Trustee, FBO Cherokee Nation 401K Plan, c/o Mutual
Funds/UAM P.O. Box 8971, Wilmington, DE, 6.9%*.
The persons(s) or organization(s) listed above as owning 25% or more of the
outstanding shares of the Portfolio may be presumed to "control" (as that term
is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
- ------
* Denotes shares held by a trustee or fiduciary for which beneficial
ownership is disclaimed or presumed disclaimed.
INVESTMENT ADVISER
CONTROL OF ADVISER
The Adviser is a wholly-owned subsidiary of UAM, a holding company
incorporated in Delaware in December 1980 for the purpose of acquiring and
owning firms engaged primarily in institutional investment management. Since its
first acquisition in August 1983, UAM has acquired or organized over 45 such
wholly-owned affiliated firms (the "UAM Affiliated Firms"). UAM believes that
permitting UAM Affiliated Firms to retain control over their investment advisory
decisions is necessary to allow them to continue to provide investment
management services that are intended to meet the particular needs of their
respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue to
operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of the UAM Funds, Inc., a registered investment company.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the Fund
and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously review, supervise and
administer the Portfolio's investment program, and to determine in its
discretion the securities to be purchased or sold and the portion of the
Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross negligence on
the part of the Adviser in the performance of its obligations and duties under
the Agreement, (ii) reckless disregard by the Adviser of its obligations and
duties under the Agreement, or (iii) a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services, the Adviser shall
not be subject to any liability whatsoever to the Fund, or to any shareholder of
the Fund, for any error of judgment, mistake of law or any other act or omission
in the course of, or connected with, rendering services under the Agreement.
Unless sooner terminated, the Agreement shall continue for periods of one
year so long as such continuance is specifically approved at least annually (a)
by the vote of a majority of those members of the
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<PAGE>
Board of Trustees of the Fund who are not parties to the Agreement or interested
persons of any such party, cast in person at a meeting called the purpose of
voting on such approval, (b) by the Board of Trustees of the Fund, or (c) by
vote of a majority of the outstanding voting securities of the Portfolio. The
Agreement may be terminated at any time by the Portfolio, without the payment of
any penalty, by vote of a majority of the entire Board of Trustees of the Fund
or by vote of a majority of the outstanding voting securities of the Portfolio
on 60 days written notice to the Adviser. The Agreement will automatically and
immediately terminate in the event of its assignment.
ADVISORY FEES
As compensation for services rendered by the Adviser under the
Investment Advisory Agreement, the Portfolio pays the Adviser an annual fee in
monthly installments, calculated by applying the following annual percentage
rate to the Portfolio's average daily net assets for the month:
Rate
BHM&S Total Return Bond Portfolio...................................0.35%
From November 1, 1995 (date of commencement) to April 30, 1996, and for the
fiscal years ended April 30, 1997 and April 30, 1998, the BHM&S Total Return
Bond Portfolio paid no advisory fees. During these periods, the Adviser
voluntarily waived advisory fees of $6,000, $40,683 and $107,452, respectively.
SERVICE AND DISTRIBUTION PLANS
As stated in the Portfolio's Service Class Shares Prospectus, the
Distributor may enter into agreements with broker-dealers and other financial
institutions ("Service Agents"), pursuant to which they will provide
administrative support services to Service Class shareholders who are their
customers ("Customers") in consideration of the Fund's payment of 0.25% (on an
annualized basis) of the average daily net asset value of the Service Class
Shares held by the Service Agent for the benefit of its Customers. Such services
include:
(a) acting as the sole shareholder of record and nominee for beneficial
owners;
(b) maintaining account records for such beneficial owners of the Fund's
shares;
(c) opening and closing accounts;
(d) answering questions and handling correspondence from shareholders
about their accounts;
(e) processing shareholder orders to purchase, redeem and exchange shares;
(f) handling the transmission of funds representing the purchase price or
redemption proceeds;
(g) issuing confirmations for transactions in the Fund's shares by
shareholders;
(h) distributing current copies of prospectuses, statements of additional
information and shareholder reports;
(i) assisting customers in completing application forms, selecting
dividend and other account options and opening any necessary custody
accounts;
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<PAGE>
(j) providing account maintenance and accounting support for all
transactions; and
(k) performing such additional shareholder services as may be agreed upon
by the Fund and the Service Agent, provided that any such additional
shareholder services must constitute a permissible non-banking
activity in accordance with the then current regulations of, and
interpretations thereof by, the Board of Governors of the Federal
Reserve System, if applicable.
Each agreement with a Service Agent is governed by a Shareholder Service
Plan (the "Service Plan") that has been adopted by the Fund's Board of Trustees.
Pursuant to the Service Plan, the Board of Trustees reviews, at least quarterly,
a written report of the amounts expended under each agreement with Service
Agents and the purposes for which the expenditures were made. In addition,
arrangements with Service Agents must be approved annually by a majority of the
Fund's Trustees, including a majority of the Trustees who are not "interested
persons" of the Fund as defined in the 1940 Act and have no direct or indirect
financial interest in such arrangements.
The Board of Trustees has approved the arrangements with Service Agents
based on information provided by the Fund's service contractors that there is a
reasonable likelihood that the arrangements will benefit the Fund and its
shareholders by affording the Fund greater flexibility in connection with the
servicing of the accounts of the beneficial owners of its shares in an efficient
manner. Any material amendment to the Fund's arrangements with Service Agents
must be approved by a majority of the Fund's Board of Trustees (including a
majority of the disinterested Trustees). So long as the arrangements with
Service Agents are in effect, the selection and nomination of the members of the
Fund's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of the Fund will be committed to the discretion of such non-interested
Trustees.
The Service Plan may be terminated at any time by vote of a majority of the
Trustees of the Fund who are not "interested persons" of the Fund and who have
no direct or indirect financial interest in the operation of the Service Plan or
any agreements related to the Service Plan or, at the discretion of the Board of
Trustees of the Fund, by vote of a majority of the outstanding voting securities
of the Fund.
Pursuant to Rule 12b-1 under the 1940 Act, the Fund has adopted a
Distribution Plan for the Service Class Shares of the Fund (the "Distribution
Plan"). The Distribution Plan permits the Fund to pay for certain distribution,
promotional and related expenses involved in the marketing of only the Service
Class Shares.
The Distribution Plan permits the Service Class Shares, pursuant to the
Distribution Agreement, to pay a monthly fee to the Distributor for its services
and expenses in distributing and promoting sales of the Service Class Shares.
These expenses include, among other things, advertising the availability of
services and products; designing materials to send to customers and developing
methods of making such materials accessible to customers; providing information
about the product needs of customers; providing facilities to solicit Fund sales
and to answer questions from prospective and existing investors about the Fund;
receiving and answering correspondence from prospective investors, including
requests for sales literature, prospectuses and statements of additional
information; displaying and making sales literature and prospectuses available;
and acting as liaison between shareholders and the Fund, including obtaining
information from the Fund and providing performance information about the Fund.
In addition, the Service Class Shares may make payments directly to other
unaffiliated parties who either aid in the distribution of their shares or
provide services to the Class.
The maximum annual aggregate fee payable by the Fund under the Service and
Distribution Plans (the "Plans"), is 0.75% of the Service Class Shares' average
daily net assets for the year. The Fund's Board of Trustees may reduce this
amount at any time. Although the maximum fee payable under the 12b-1 Plan
relating to the Service Class Shares is 0.75% of average daily net assets of
such class, the Board of Trustees has determined that the annual fee, payable on
a monthly basis, under the Plans relating to the Service Class Shares, currently
cannot exceed 0.50% of the average daily net assets represented by the Service
Class. While the current fee which will be
12
<PAGE>
payable under the Service Plan has been set at 0.25%, the Plans permit a full
0.75% on all assets to be paid at any time following appropriate Board approval.
All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid by the Service
Class Shares will be borne by such persons without any reimbursement from such
Classes. Subject to seeking best price and execution, the Fund may, from time to
time, buy or sell portfolio securities from or to firms which receive payments
under the Plans. From time to time, the Distributor may pay additional amounts
from its own resources to dealers for aid in distribution or for aid in
providing administrative services to shareholders.
The Plans, the Distribution Agreement and the form of dealer's and
services agreements have all been approved by the Board of Trustees of the Fund,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund and who have no direct or indirect
financial interest in the Plans or any related agreements, by vote cast in
person at a meeting duly called for the purpose of voting on the Plans and such
Agreements. Continuation of the Plans, the Distribution Agreement and the
related agreements must be approved annually by the Board of Trustees in the
same manner, as specified above.
Each year the Trustees must determine whether continuation of the
Plans is in the best interest of the shareholders of Service Class Shares and
that there is a reasonable likelihood of the Plans providing a benefit to the
Class. The Plans, the Distribution Agreement and the related agreements with any
broker-dealer or others relating to the Class may be terminated at any time
without penalty by a majority of those Trustees who are not "interested persons"
or by a majority vote of the outstanding voting securities of the Class. Any
amendment materially increasing the maximum percentage payable under the Plans
must likewise be approved by a majority vote of the relevant Class' outstanding
voting securities, as well as by a majority vote of those Trustees who are not
"interested persons." Also, any other material amendment to the Plans must be
approved by a majority vote of the Trustees including a majority of the Trustees
of the Fund having no interest in the Plans. In addition, in order for the Plans
to remain effective, the selection and nomination of Trustees who are not
"interested persons" of the Fund must be effected by the Trustees who themselves
are not "interested persons" and who have no direct or indirect financial
interest in the Plans. Persons authorized to make payments under the Plans must
provide written reports at least quarterly to the Board of Trustees for their
review. The National Association of Securities Dealers Regulation, Inc. adopted
amendments to its Conduct Rules relating to investment company sales charges.
The Fund and the Distributor intend to operate in compliance with these rules.
During the fiscal year ended April 30, 1998, the Portfolio's Service
Class Shares paid $30,070 for services provided pursuant to the Distribution
Plan.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreement authorizes the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio.
The Adviser may, however, consistent with the interests of the Portfolio, select
brokers on the basis of the research, statistical and pricing services they
provide to the Portfolio. Information and research received from such brokers
will be in addition to, and not in lieu of, the services required to be
performed by the Adviser under the Investment Advisory Agreements. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect
principal transactions with dealers on the basis of sales of Fund shares which
may be made through broker-dealer firms. However, the Adviser may place
portfolio orders with qualified broker-dealers who refer clients to the Adviser.
13
<PAGE>
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of a Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Board of Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration
Agreement, effective April 15, 1996 ("Fund Administration Agreement") between
UAMFSI, a wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms
of the Fund Administration Agreement, UAMFSI manages, administers and conducts
the general business activities of the Fund other than those which have been
contracted to other third parties by the Fund. Additionally, UAMFSI has agreed
to provide transfer agency services to the Portfolios pursuant to the terms of
the Fund Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC , an
affiliate of the Chase Manhattan Bank, pursuant to a Mutual Funds Service
Agreement between UAMFSI and CGFSC (collectively, with the Fund Administration
Agreement, the "Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a
two-part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a
sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
Annual Rate
BHM&S Total Return Bond Portfolio...................0.04%
CGFSC's monthly fee for its services is calculated on an annualized
basis as follows:
0.19 of 1% of the first $200 million of combined Fund net
assets;
0.11 of 1% of the next $800 million of combined Fund net
assets;
0.07 of 1% of combined Fund net assets in excess of
$1 billion but less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of
$3 billion.
Fees are located among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two year. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds
Service Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
The basis of the fees paid to CGFSC for the period November 1, 1995 to
April 14, 1996 was as follows: the Fund paid a monthly fee for its services
which on an annualized basis equaled 0.20% of the first $200 million in combined
assets; plus 0.12% of the next $800 million in combined assets; plus 0.08% on
assets over $1 billion but less than $3 billion; plus 0.06% on assets over $3
billion. The fees were allocated among the Portfolios on the basis of their
relative assets and were subject to a designated minimum fee schedule per
Portfolio, which ranged from
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$2,000 per month upon inception of a Portfolio to $70,000 annually after two
years. For the period ended April 30, 1996, and for the fiscal years ended April
30, 1997 and April 30, 1998, administrative services fees paid to CGFSC by the
BHM&S Total Return Bond Portfolio totaled $22,073, $82,083 and $98,003,
respectively. For the period April 15, 1996 to April 30, 1996, and for the
fiscal years ended April 30, 1997 and April 30, 1998, UAMFSI earned $1,927, $838
and $12,244, respectively, from the BHM&S Total Return Bond Portfolio as
Administrator. The services provided by UAMFSI and CGFSC and the fees payable to
both effective April 15, 1996 are described in the Portfolio's Prospectuses.
UAMFSI will bear all expenses in connection with the performance of
its services under the Fund Administration Agreement. Other expenses to be
incurred in the operation of the Fund will be borne by the Fund or other
parties, including taxes, interest, brokerage fees and commissions, if any,
salaries and fees of officers and members of the Board who are not officers,
directors, shareholders or employees of UAMFSI, or the Fund's investment adviser
or distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund
Administration Agreement is terminable, without penalty, by the Board or by
UAMFSI, on not less than ninety (90) days' written notice. The Fund
Administration Agreement shall automatically terminate upon its assignment by
UAMFSI without the prior written consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person
or persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Portfolio paid the
Service Provider $40,175, in fees pursuant to the Services Agreement, all of
which were voluntarily waived.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New
York 11245, provides for the custody of the Fund's assets pursuant to the terms
of a custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110,
serves as independent accountants for the Fund.
DISTRIBUTOR
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UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves
as the Fund's Distributor. Shares of the Fund are offered continuously. While
the Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares. The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
April 30, 1998.
16
<PAGE>
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures to
illustrate past performance. Performance quotations by investment companies are
subject to rules adopted by the SEC, which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by each class of a Portfolio be accompanied by
certain standardized performance information computed as required by the SEC.
Current yield and average annual compounded total return quotations used by a
Portfolio are based on the standardized methods of computing performance
mandated by the SEC. An explanation of those methods used to compute or express
performance follows.
YIELD
Current yield reflects the income per share earned by a Portfolio's
investment. The current yield of a Portfolio is determined by dividing the net
investment income per share earned during a 30-day base period by the maximum
offering price per share on the last day of the period and annualizing the
result. Expenses accrued for the period include any fees charged to all
shareholders during the base period. Since Service Class Shares of a Portfolio
bear additional service and distribution expenses, the yield of the Service
Class Shares of a Portfolio will generally be lower than that of the
Institutional Class Shares of the same Portfolio. The yields for the Portfolio's
Institutional Class Shares and Service Class Shares for the 30-day period ended
on April 30, 1998 were 5.69% and 5.44%, respectively.
A yield figure is obtained using the following formula:
Yield = 2[(a - b + 1)/6/ - 1]
------------
cd
where:
a = dividends and interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding during the period
that were entitled to receive income distributions
d = the maximum offering price per share on the last day of the period.
TOTAL RETURN
The average annual total return of a Portfolio is determined by finding the
average annual compounded rates of return over 1, 5 and 10 year periods that
would equate an initial hypothetical $1,000 investment to its ending redeemable
value. The calculation assumes that all dividends and distributions are
reinvested when paid. The quotation assumes the amount was completely redeemed
at the end of each 1, 5 and 10 year period and the deduction of all applicable
Portfolio expenses on an annual basis. Since Service Class Shares of a Portfolio
bear additional service and distribution expenses, the average annual total
return of the Service Class Shares of a Portfolio will generally be lower than
that of the Institutional Class Shares of the same Portfolio.
These figures are calculated according to the following formula:
P(1 + T)/n/ = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
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<PAGE>
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the 1, 5 or 10 year periods at the end of the 1, 5 or
10 year periods (or fractional portion thereof).
The average annual total returns for the Portfolio's Institutional Class
Shares from inception on November 1, 1995 to April 30, 1998, and for the fiscal
year ended April 30, 1998 were 6.74% and 10.16%, respectively.
The average annual total returns for the Portfolio's Service Class Shares from
inception on November 1, 1995 to April 30, 1998, and for the fiscal year ended
April 30, 1998 were 6.44% and 9.85%, respectively.
COMPARISONS
To help investors better evaluate how an investment in either Portfolio of the
Fund might satisfy their investment objective, advertisements regarding the
Portfolio may discuss various measures of Portfolio performance as reported by
various financial publications. Advertisements may also compare performance (as
calculated above) to performance as reported by other investments, indices and
averages. Please see Appendix B for publications, indices and averages which may
be used.
In assessing such comparisons of performance, an investor should keep in mind
that the composition of the investments in the reported indices and averages is
not identical to the composition of investments in a Portfolio, that the
averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name The Regis Fund II as a Delaware business
trust on May 18, 1994. On October 31, 1995, the name of the Fund was changed to
"UAM Funds Trust." The Fund's principal office is located at One International
Place, Boston, MA 02110; however, all investor correspondence should be
addressed to the Fund at UAM Funds Service Center, c/o Chase Global Funds
Services Company, P.O. Box 2798, Boston, MA 02208-2798. The Fund's Agreement and
Declaration of Trust permits the Fund to issue an unlimited number of shares of
beneficial interest, without par value. The Trustees have the power to designate
one or more series ("Portfolios") or classes of shares of beneficial interest
without further action by shareholders.
The Board of Trustees has classified an additional class of shares in the
Portfolio, known as Advisor Shares. As of the date of this Statement of
Additional Information, no Advisor Shares have been offered by the Portfolio.
The shares of the Portfolio, when issued and paid for as provided for in its
Prospectuses, will be fully paid and nonassessable, have no preference as to
conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which means that the holders of more than 50% of the shares voting for the
election of Trustees can elect 100% of the Trustees if they choose to do so. A
shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
each represent an interest in the same assets of a Portfolio and are identical
in all respects except that the Service Class Shares bear certain expenses
related to shareholder servicing and
18
<PAGE>
the distribution of such shares, and have exclusive voting rights with respect
to matters relating to such distribution expenditures.
In the event of liquidation of the Fund, the holders of the Shares of each
Portfolio or any class thereof that has been established and designated shall be
entitled to receive, when and as declared by the Trustees, the excess of the
assets belonging to that Portfolio, or in the case of a class, belonging to that
Portfolio and allocable to that class, over the liabilities belonging to that
Portfolio or class. The assets so distributable to the holders of Shares of any
particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of Shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of the Portfolio's net
investment income, if any, together with any net realized capital gains in the
amount and at the times that will avoid both income (including capital gains)
taxes incurred and the imposition of the federal excise tax on undistributed
income and capital gains. The amounts of any income dividends or capital gains
distributions cannot be predicted. See discussion under "Dividends, Capital
Gains Distributions and Taxes" in the Prospectuses.
Any dividend or distribution paid shortly after the purchase of shares of the
Portfolio by an investor may have the effect of reducing the per share net asset
value of the Portfolio by the per share amount of the dividend or distribution.
Furthermore, such dividends or distributions, although in effect a return of
capital, are subject to income taxes as set forth in the Prospectuses.
As set forth in the Prospectuses, unless the shareholder elects otherwise in
writing, all dividend and capital gains distributions are automatically
reinvested in additional shares of the Portfolio of the Fund at net asset value
(as of the business day following the record date). This will remain in effect
until the Fund is notified by the shareholder in writing at least three days
prior to the record date that either the Income Option (income dividends in cash
and capital gains distributions in additional shares at net asset value) or the
Cash Option (both income dividends and capital gains distributions in cash) has
been elected. An account statement is sent to shareholders whenever an income
dividend or capital gains distribution is paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain extent
personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
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FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's Annual
Report to Shareholders (the "1998 Annual Report") are incorporated by reference
into this Statement of Additional Information. No other parts of the 1998 Annual
Report are incorporated by reference herein. The Financial Statements included
in the 1998 Annual Report have been audited by the Fund's independent
accountants, PricewaterhouseCoopers LLP. The reports of PricewaterhouseCoopers
LLP are incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such reports given upon the authority of
PricewaterhouseCoopers LLP as experts in accounting and auditing. Copies of the
1998 Annual Report may be obtained free of charge by telephoning the UAM Funds
Service Center at the telephone number appearing on the front page of this
Statement of Additional Information.
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<PAGE>
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
Moody's Investors Service Corporate Bond Ratings:
Aaa -- Bonds which are Aaa are judged to be 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.
Moody's applies numerical modifiers 1, 2 and 3 in the Aa and A rating
categories. The modifier 1 indicates that the security ranks at a higher end of
the rating category, modifier 2 indicates a mid-range rating and the modifier 3
indicates that the issue ranks at the lower end of the rating category.
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.
Standard & Poor's Corporation's Corporate Bond Ratings:
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to 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 -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
Duff & Phelp's Corporate Bond Ratings:
AAA - Debt is considered to be of the highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.
A-1
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AA - Debt is considered of high credit quality. Protection factors are strong.
Risk is modest but may vary slightly from time to time because of economic
conditions.
A - Debt possesses protection factors which are average but adequate. However,
risk factors are more variable and greater in periods of economic stress.
BBB - Debt possesses below-average protection factors but such protection
factors are still considered sufficient for prudent investment. Considerable
variability in risk is present during economic cycles.
BB - Debt that possesses one of these ratings is considered to be below
investment grade. Although below investment grade, debt rated BB is deemed
likely to meet obligations when due.
To provide more detailed indications of credit quality, the AA, A, BBB, and BB
ratings may be modified by the addition of a plus (+) or minus (-) sign to show
relative standing within these major categories.
Fitch IBCA's Corporate Bond Ratings:
AAA - Bonds considered to be investment grade and of the highest credit
quality. These ratings denote the lowest expectation of investment risk and are
assigned only in case of exceptionally strong capacity for timely payment of
financial commitments. This capacity is very unlikely to be adversely affected
by foreseeable events.
AA - Bonds considered to be investment grade and of very high credit quality.
These ratings denote a very low expectation of investment risk and indicate very
strong capacity for timely payment of financial commitments. This capacity is
not significantly vulnerable to foreseeable events.
A - Bonds considered to be investment grade and of high credit quality. These
ratings denote a low expectation of investment risk and indicate strong capacity
for timely payment of financial commitments. This capacity may, nevertheless, be
more vulnerable to adverse changes in circumstances or in economic conditions
than bonds with higher ratings.
BBB - Bonds considered to be investment grade and of good credit quality.
These ratings denote that there is currently a low expectation of investment
risk. The capacity for timely payment of financial commitments is adequate, but
adverse changes in circumstances and in economic conditions are more likely to
impair this category.
BB - Bonds considered to be speculative. These ratings indicate that there is
a possibility of credit risk developing, particularly as the result of adverse
economic changes over time; however, business or financial alternatives may be
available to allow financial commitments to be met. Securities rated in this
category are not investment grade.
To provide more detailed indications of credit quality, the Fitch IBCA ratings
from and including AA to BB may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within these major rating categories.
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II. DESCRIPTION OF MUNICIPAL NOTE RATINGS
Moody's Investors Service Municipal Notes Ratings:
MIG1 -- Municipal Notes which are rated MIG1 are considered best quality.
There is present strong protection by established cash flows, superior liquidity
support or demonstrated broad-based access to the market for refinancing.
MIG2 -- Municipal Notes which are rated MIG2 are considered high quality.
Margins of protection are ample although not so large as in the preceding group.
MIG3 -- Municipal Notes which are rated MIG3 are considered favorable
quality. All security elements are accounted for but there is lacking the
undeniable strength of the preceding grades. Liquidity and cash flow protection
may be narrow and market access for refinancing is likely to be less well
established.
Standard & Poor's Corporation's Municipal Notes Ratings:
SP-1 -- Municipal Notes which are rated SP-1 are considered to possess a
strong capacity to pay principal and interest. Issues determined to possess very
strong characteristics are given a plus (+) designation.
SP-2 -- Municipal Notes which are rated SP-2 are considered to possess a
satisfactory capacity to pay principal and interest, with some vulnerability to
adverse financial and economic changes over the term of the notes.
Duff & Phelp's Municipal Notes Ratings:
D-1+ - Debt possesses the highest certainty of timely payment. Short-term
liquidity, including internal operating factors and/or access to alternative
sources of funds, is outstanding, and safety is just below risk-free U.S.
Treasury short-term obligations.
D-1 - Debt possesses very high certainty of timely payment. Liquidity
factors are excellent and supported by good fundamental protection factors. Risk
factors are minor.
D-1- - Debt possesses high certainty of timely payment. Liquidity factors
are strong and supported by good fundamental protection factors. Risk factors
are very small.
D-2 - Debt possesses good certainty of timely payment. Liquidity factors
and company fundamentals are sound. Although ongoing funding needs may enlarge
total financing requirements, access to capital markets is good. Risk factors
are small.
D-3 - Debt possesses satisfactory liquidity and other protection factors
qualify issues as investment grade. Risk factors are larger and subject to more
variation. Nevertheless, timely payment is expected.
D-4 - Debt possesses speculative investment characteristics. Liquidity is
not sufficient to insure against disruption in debt service. Operating factors
and market access may be subject to a high degree of variation.
Fitch IBCA's Municipal Notes Ratings:
F1 - Securities possess the highest credit quality. This designation
indicates the strongest capacity for timely payment of financial commitments and
may have an added "+" to denote any exceptionally strong credit feature.
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F2 - Securities possess good credit quality. This designation indicates a
satisfactory capacity for timely payment of financial commitments, but the
margin of safety is not as great as in the case of securities rated "F1."
F3 - Securities possess fair credit quality. This designation indicates
that the capacity for timely payment of financial commitments is adequate;
however, near-term adverse changes could result in a reduction to non-investment
grade.
B - Securities possess speculative credit quality. this designation
indicates minimal capacity for timely payment of financial commitments, plus
vulnerability to near-term adverse changes in financial and economic conditions.
III. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
and may not be able to assess a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, Federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the GNMA are, in effect, backed
by the full faith and credit of the United States through provisions in their
charters that they may make "indefinite and unlimited" drawings on the U.S.
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and FNMA, is not
guaranteed by the United States, but those institutions are protected by the
discretionary authority of the U.S. Treasury to purchase certain amounts of
their securities to assist the institution in meeting its debt obligations.
Finally, other agencies and instrumentalities, such as the Farm Credit System
and the FHLMC, are federally chartered institutions under Government
supervision, but their debt securities are backed only by the creditworthiness
of those institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
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IV. DESCRIPTION OF COMMERCIAL PAPER
The Portfolio may invest in commercial paper (including variable amount
master demand notes) rated A-1 or better by Standard & Poor's Corporation
("S&P") or Prime-1 by Moody's Investors Service ("Moody's") or by S&P.
Commercial paper refers to short-term, unsecured promissory notes issued by
corporations to finance short-term credit needs. Commercial paper is usually
sold on a discount basis and has a maturity at the time of issuance not
exceeding nine months. Variable amount master demand notes are demand
obligations that permit the investment of fluctuating amounts at varying market
rates of interest pursuant to arrangement between the issuer and a commercial
bank acting as agent for the payees of such notes whereby both parties have the
right to vary the amount of the outstanding indebtedness on the notes. As
variable amount master demand notes are direct lending arrangements between a
lender and a borrower, it is not generally contemplated that such instruments
will be traded, and there is no secondary market for these notes, although they
are redeemable (and thus immediately repayable by the borrower) at face value,
plus accrued interest, at any time. In connection with the Portfolio's
investment in variable amount master demand notes, the Adviser's investment
management staff will monitor, on an ongoing basis, the earning power, cash flow
and other liquidity ratios of the issuer and the borrower's ability to pay
principal and interest on demand.
Commercial paper rated A-1 by S&P has the following characteristics: (1)
liquidity ratios are adequate to meet cash requirements; (2) long-term senior
debt is rated "A" or better; (3) the issuer has access to at least two
additional channels of borrowing; (4) basic earnings and cash flow have an
upward trend with allowance made for unusual circumstances; (5) typically, the
issuer's industry is well established, and the issuer has a strong position
within the industry; and (6) the reliability and quality of management are
unquestioned. Relative strength or weakness of the above factors determine
whether the issuer's commercial paper is A-1, A-2 or A-3. The rating Prime-1 is
the highest commercial paper rating assigned by Moody's. Among the factors
considered by Moody's in assigning ratings are the following: (1) evaluation of
the management of the issuer; (2) economic evaluation of the issuer's industry
or industries and the appraisal of speculative-type risks which may be inherent
in certain areas; (3) evaluation of the issuer's products in relation to
completion and customer acceptance; (4) liquidity; (5) amount and quality of
long term debt; (6) trend of earnings over a period of ten years; (7) financial
strength of a parent company and the relationships which exist with the issuer;
and (8) recognition by the management of issuer of obligations which may be
present or may arise as a result of public interest questions and preparations
to meet such obligations. Relative strength or weakness of the above factors
determine whether the issuer's commercial paper is Prime-1 or Prime-2.
V. DESCRIPTION OF BANK OBLIGATIONS
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Certificates of deposit are negotiable short-term obligations of commercial
banks. Variable rate certificates of deposit are certificates of deposit on
which the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. As a result of these adjustments, the
interest rate on these obligations may increase or decrease periodically.
Frequently, dealers selling variable rate certificates of deposit to the
Portfolio will agree to repurchase such instruments, at the Portfolio's option,
at par on or near the coupon dates. The dealers' obligations to repurchase these
instruments are subject to conditions imposed by various dealers. Such
conditions typically are the continued credit standing of the issuer and the
existence of reasonably orderly market conditions. The Portfolio is also able to
sell variable rate certificates of deposit in the secondary market. Variable
rate certificates of deposit normally carry a higher interest rate than
comparable fixed rate certificates of deposit. A banker's acceptance is a time
draft drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction to finance the import, export, transfer or
storage of goods. The borrower is liable for payment as well as the bank which
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
the secondary markets prior to maturity.
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APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an unmanaged index
composed of 30 blue-chip industrial corporation stocks (Dow Jones
Industrial Average), 15 utilities company stocks and 20 transportation
stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an unmanaged
index composed of 400 industrial stocks, 40 financial stocks, 40 utilities
stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic stocks
chosen for market size, liquidity, and industry group representation. It
is also a market-value weighted index and was the first benchmark of mid
cap stock price movement.
(d) The New York Stock Exchange composite or component indices -- unmanaged
indices of all industrial, utilities, transportation and finance stocks
listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents the
return on the market value of all common equity securities for which daily
pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed Income Fund
Performance Analysis -- measure total return and average current yield for
the mutual fund industry. Rank individual mutual fund performance over
specified time periods, assuming reinvestment of all distributions,
exclusive of any applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at maximum
capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions.
(h) Lipper Small Cap Funds Index- a fund that by prospectus or portfolio
practice invests primarily in companies with market capitalizations of less
than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index --
respectively, arithmetic, market value-weighted averages of the performance
of over 900 securities listed on the stock exchanges of countries in
Europe, Australia and the Far East, and over 1,400 securities listed on the
stock exchanges of these continents, including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67 bonds and
33 preferred. The original list of names was generated by screening for
convertible issues of 100 million or greater in market capitalization. The
index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages originated by
private lenders and guaranteed by the mortgage pools of the Government
National Mortgage Association.
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of publicly
issued, non-convertible corporate bonds rated AA or AAA. It is a value-
weighted, total return index, including approximately 800 issues with
maturities of 12 years or greater.
(m) Salomon Brothers Broad Investment Grade Bond Index -- is a market-weighted
index that contains approximately 4,700 individually priced investment
grade corporate bonds rated BBB or better, U.S. Treasury/agency issues and
mortgage pass through securities.
B-1
<PAGE>
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of all bonds
covered by the Lehman Brothers Treasury Bond Index with maturities of 10
years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of the
Government and Corporate Bond Indices. The Government Index includes public
obligations of the U.S. Treasury, issues of Government agencies, and
corporate debt backed by the U.S. Government. The Corporate Bond Index
includes fixed-rate nonconvertible corporate debt. Also included are Yankee
Bonds and nonconvertible debt issued by or guaranteed by foreign or
international governments and agencies. All issues are investment grade
(BBB) or higher, with maturities of at least one year and an outstanding
par value of at least $100 million for U.S. Government issues and $25
million for others. Any security downgraded during the month is held in the
index until month-end and then removed. All returns are market value
weighted inclusive of accrued income.
(p) Lehman Brothers Aggregate Bond Index --- is a fixed income market value-
weighted index that combines the Lehman Brothers Government Corporate Bond
Index and the Lehman Brothers Mortgage-Backed Securities Index. It
includes fixed rate issues of investment grade (BBB) or higher, with
maturities of at least one year and outstanding per values of at least $100
million for U.S. Government issues and $25 million for others.
(q) NASDAQ Industrial Index -- is composed of more than 3,000 industrial
issues. It is a value-weighted index calculated on price change only and
does not include income.
(r) Value Line -- composed of over 1,600 stocks in the Value Line Investment
Survey.
(s) Russell 2000 Index -- composed of the 2,000 smallest stocks in the Russell
3000, a market value-weighted index of the 3,000 largest U.S. publicly-
traded companies.
(t) Salomon Brothers 3 Month T-Bill Average - the average return for all
Treasury bills for the previous three month period.
(u) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30% Lehman
Brothers Long-Term Treasury Bond and 10% U.S. Treasury Bills; 70% Standard
& Poor's 500 Stock Index and 30% NASDAQ Industrial Index; 35% Standard &
Poor's 500 Stock Index and 65% Salomon Brothers High Grade Bond Index; all
stocks on the NASDAQ system exclusive of those traded on an exchange, and
65% Standard & Poor's 500 Stock Index and 35% Salomon Brothers High Grade
Bond Index.
(v) CDA Mutual Fund Report published by CDA Investment Technologies, Inc. --
analyzes price, current yield, risk, total return and average rate of
return (average compounded growth rate) over specified time periods for the
mutual fund industry.
(w) Mutual Fund Source Book published by Morningstar, Inc. -- analyzes price,
yield, risk and total return for equity funds.
(x) Financial publications: Business Week, Changing Times, Financial World,
Forbes, Fortune, Money, Barron's, Consumer's Digest, Financial Times,
Global Investor, Wall Street Journal and Weisenberger Investment Companies
Service -- publications that rate fund performance over specified time
periods.
(y) Consumer Price Index (or Cost of Living Index), published by the U.S.
Bureau of Labor Statistics -- a statistical measure of change over time in
the price of goods and services in major expenditure groups.
B-2
<PAGE>
(z) Stocks, Bonds, Bills and Inflation, published by Ibbotson Associates --
historical measure of yield, price and total return for common and small
company stock, long-term government bonds, U.S. Treasury bills and
inflation.
(aa) Savings and Loan Historical Interest Rates -- as published by the U.S.
Savings & Loan League Fact Book.
(bb) Historical data supplied by the research departments of First Boston
Corporation; the J.P. Morgan companies; Salomon Brothers; Merrill Lynch,
Pierce, Fenner & Smith; Lehman Brothers, Inc.; and Bloomberg L.P.
B-3
<PAGE>
PART B
UAM FUNDS
CHICAGO ASSET MANAGEMENT VALUE/CONTRARIAN
PORTFOLIO
CHICAGO ASSET MANAGEMENT INTERMEDIATE BOND
PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectuses of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the Chicago Asset Management Value/Contrarian
Portfolio Institutional Class Shares and Chicago Asset Management Intermediate
Bond Portfolio Institutional Class Shares (the "Portfolios") dated July 17,
1998. To obtain the Prospectuses, please call the UAM Funds Service Center at 1-
800-638-7983.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT OBJECTIVE AND POLICIES................................... 2
PURCHASE AND REDEMPTION OF SHARES................................... 9
VALUATION OF SHARES................................................. 10
SHAREHOLDER SERVICES................................................ 10
INVESTMENT LIMITATIONS.............................................. 11
MANAGEMENT OF THE FUND.............................................. 12
INVESTMENT ADVISER.................................................. 15
PORTFOLIO TRANSACTIONS.............................................. 16
ADMINISTRATIVE SERVICES............................................. 17
CUSTODIAN........................................................... 19
INDEPENDENT ACCOUNTANTS............................................. 19
DISTRIBUTOR......................................................... 19
PERFORMANCE CALCULATIONS............................................ 19
GENERAL INFORMATION................................................. 21
FINANCIAL STATEMENTS................................................ 22
APPENDIX A -- DESCRIPTION OF SECURITIES AND CORPORATE BOND RATINGS.. A-1
APPENDIX B - COMPARISONS............................................ B-1
</TABLE>
Investment Adviser
Chicago Asset Management Company (Adviser)
Distributor
UAM Fund Distributor, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment objectives
and policies of the Portfolios as set forth in the Portfolios' Prospectuses.
LENDING OF SECURITIES
Each Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest bearing short-term investments). Each Portfolio will
not loan securities to the extent that greater than one-third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as discussed in the Prospectuses.
HEDGING STRATEGIES
Each Portfolio may engage in various portfolio strategies to hedge against
adverse movements in the equity, debt and currency markets. Each Portfolio may
buy or sell futures contracts, write (i.e., sell) covered call options on its
portfolio securities, purchase put and call options on securities and engage in
transactions in stock index options and stock index futures, and related options
on such futures. Each Portfolio may also enter into foreign currency contracts
to hedge against its foreign currency movements. Each of these portfolio
strategies is described below. Although certain risks are involved in options
and futures transactions, the Adviser believes that, because the Portfolios will
engage in options and futures transactions only for hedging purposes, the
options and futures portfolio strategies of a Portfolio will not subject it to
the risks frequently associated with the speculative use of options and futures
transactions. While each Portfolio's use of hedging strategies is intended to
reduce the volatility of the net asset value of the Portfolio shares, the
Portfolios' net asset value will fluctuate. There can be no assurance that a
Portfolio's hedging transactions will be effective. Also, a Portfolio may not
necessarily be engaging in hedging activities when movements in any particular
equity, debt or currency market occur.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The U.S. dollar value of the assets of the Portfolios may be affected
favorably or unfavorably by changes in foreign currency exchange rates and
exchange control regulations, and the Portfolios may incur costs in connection
with conversions between various currencies. The Portfolios will conduct their
foreign currency exchange transactions either on a spot (i.e., cash) basis at
the spot rate prevailing in the foreign currency exchange market, or through
entering into forward contracts to purchase or sell foreign currencies. A
forward foreign currency exchange contract involves an obligation to purchase or
sell a specific currency at a future date, which may be any fixed number of days
from the date of the contract agreed upon by the parties, at a price set at the
time of the contract. These contracts are traded in the interbank market and are
conducted directly between currency traders (usually large commercial banks) and
their customers. A forward contract generally has no deposit requirement, and no
commissions are charged at any stage for such trades.
The Portfolios may enter into forward foreign currency exchange contracts in
several circumstances. When a Portfolio enters into a contract for the purchase
or sale of a security denominated in a foreign currency, or when a
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Portfolio anticipates the receipt in a foreign currency of dividends or interest
payments on a security which it holds, the Portfolio may desire to "lock-in" the
U.S. dollar price of the security or the U.S. dollar equivalent of such dividend
or interest payment, as the case may be. By entering into a forward contract for
a fixed amount of dollars, for the purchase or sale of the amount of foreign
currency involved in the underlying transactions, the Portfolio will be able to
protect itself against a possible loss resulting from an adverse change in the
relationship between the U.S. dollar and the subject foreign currency during the
period between the date on which the security is purchased or sold, or on which
the dividend or interest payment is declared, and the date on which such
payments are made or received.
Additionally, when either of the Portfolios anticipates that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, it may enter into a forward contract for a fixed amount of dollars to
sell the amount of foreign currency approximating the value of some or all of
such Portfolio's securities denominated in such foreign currency. The precise
matching of the forward contract amounts and the value of the securities
involved will not generally be possible since the future value of securities in
foreign currencies will change as a consequence of market movements in the value
of these securities between the date on which the forward contract is entered
into and the date it matures. The projection of short-term currency market
movement is extremely difficult, and the successful execution of a short-term
hedging strategy is highly uncertain. Neither Portfolio intends to enter into
such forward contracts to protect the value of portfolio securities on a regular
or continuous basis. The Portfolios will not enter into such forward contracts
or maintain a net exposure to such contracts where the consummation of the
contracts would obligate such Portfolio to deliver an amount of foreign currency
in excess of the value of such Portfolio's securities or other assets
denominated in that currency.
Under normal circumstances, consideration of the prospect for currency
parities will be incorporated into the long-term investment decisions made with
regard to overall diversification strategies. However, the management of the
Fund believes that it is important to have the flexibility to enter into such
forward contracts when it determines that the best interests of the performance
of each Portfolio will thereby be served. The Fund's Custodian will place cash
or liquid securities into a segregated account in an amount equal to the value
of such Portfolio's total assets committed to the consummation of forward
foreign currency exchange contracts. If the value of the securities placed in
the segregated account declines, additional cash or securities will be placed in
the account on a daily basis so that the value of the account will be equal to
the amount of such Portfolio's commitments with respect to such contracts.
The Portfolios generally will not enter into a forward contract with a term of
greater than one year. At the maturity of a forward contract, a Portfolio may
either sell the portfolio security and make delivery of the foreign currency, or
it may retain the security and terminate its contractual obligation to deliver
the foreign currency by purchasing an "offsetting" contract with the same
currency trader obligating it to purchase, on the same maturity date, the same
amount of the foreign currency.
It is impossible to forecast with absolute precision the market value of a
particular portfolio security at the expiration of the contract. Accordingly, it
may be necessary for a Portfolio to purchase additional foreign currency on the
spot market (and bear the expense of such purchase) if the market value of the
security is less than the amount of foreign currency that such Portfolio is
obligated to deliver and if a decision is made to sell the security and make
delivery of the foreign currency.
If a Portfolio retains the portfolio security and engages in an offsetting
transaction, such Portfolio will incur a gain or loss (as described below) to
the extent that there has been movement in forward contract prices. Should
forward prices decline during the period between a Portfolio entering into a
forward contract for the sale of a foreign currency and the date it enters into
an offsetting contract for the purchase of the foreign currency, such Portfolio
will realize a gain to the extent that the price of the currency it has agreed
to sell exceeds the price of the currency it has agreed to purchase. Should
forward prices increase, such Portfolio would suffer a loss to the extent that
the price of the currency it has agreed to purchase exceeds the price of the
currency it has agreed to sell.
Each of the Portfolios' dealings in forward foreign currency exchange
contracts will be limited to the transactions described above. Of course, the
Portfolios are not required to enter into such transactions with regard to
3
<PAGE>
their foreign currency-denominated securities. It also should be realized that
this method of protecting the value of portfolio securities against a decline in
the value of a currency does not eliminate fluctuations in the underlying prices
of the securities. It simply establishes a rate of exchange which one can
achieve at some future point in time. Additionally, although such contracts tend
to minimize the risk of loss due to a decline in the value of the hedged
currency, at the same time, they tend to limit any potential gain which might
result should the value of such currency increase.
FUTURES CONTRACTS
Each Portfolio may enter into futures contracts for the purposes of hedging,
remaining fully invested and reducing transactions costs. Futures contracts
provide for the future sale by one party and purchase by another party of a
specified amount of a specific security at a specified future time and at a
specified price. Futures contracts which are standardized as to maturity date
and underlying financial instrument are traded on national futures exchanges.
Futures exchanges and trading are regulated under the Commodity Exchange Act by
the Commodity Futures Trading Commission ("CFTC"), a U.S. Government agency.
Although futures contracts by their terms call for actual delivery or
acceptance of the underlying securities, in most cases the contracts are closed
out before the settlement date without the making or taking of delivery. Closing
out an open futures position is done by taking an opposite position ("buying" a
contract which has previously been "sold" or "selling" a contract previously
"purchased") in an identical contract to terminate the position. Brokerage
commissions are incurred when a futures contract is bought or sold.
Futures traders are required to make a good faith margin deposit in cash or
acceptable securities with a broker or custodian to initiate and maintain open
positions in futures contracts. A margin deposit is intended to assure
completion of the contract (delivery or acceptance of the underlying security)
if it is not terminated prior to the specified delivery date. Minimal initial
margin requirements are established by the futures exchange and may be changed.
Brokers may establish deposit requirements which are higher than the exchange
minimums. Generally, margin deposits are structured as percentages (e.g., 5%) of
the market value of the contracts being traded. After a futures contract
position is opened, the value of the contract is marked to market daily. If the
futures contract price changes to the extent that the margin on deposit does not
satisfy margin requirements, payment of additional "variation" margin will be
required. Conversely, changes in the contract value may reduce the required
margin, resulting in a repayment of excess margin to the contract holder.
Variation margin payments are made to and from the futures broker for as long as
the contract remains open. The Portfolios expect to earn interest income on
their margin deposits.
Traders in futures contracts may be broadly classified as either "hedgers" or
"speculators." Hedgers use the futures markets primarily to offset unfavorable
changes in the value of securities otherwise held for investment purposes or
expected to be acquired by them. Speculators are less inclined to own the
securities underlying the futures contracts which they trade and use futures
contracts with the expectation of realizing profits from a fluctuation in
interest rates. The Portfolios intend to use futures contracts only for hedging
purposes.
Regulations of the CFTC applicable to the Fund require that all of its futures
transactions constitute bona fide hedging positions or that the Fund's commodity
futures and option positions be for other purposes, only to the extent that the
aggregate initial margins and premiums required to establish such non-hedging
positions do not exceed five percent of the liquidation value of a Portfolio. A
Portfolio will only sell futures contracts to protect securities it owns against
price declines or purchase contracts to protect against an increase in the price
of securities it intends to purchase. As evidence of this hedging interest, each
Portfolio expects that approximately 75% of its futures contracts purchases will
be "completed," that is, equivalent amounts of related securities will have
been purchased or will be purchased by the Portfolio on the settlement date of
the futures contracts.
Although techniques other than the sale and purchase of futures contracts
could be used to control the Portfolio's exposure to market fluctuations, the
use of futures contracts may be a more effective means of hedging
4
<PAGE>
this exposure. While the Portfolio will incur commission expenses in both
opening and closing out futures positions, these costs are lower than
transaction costs incurred in the purchase and sale of the underlying
securities.
RESTRICTIONS ON THE USE OF FUTURES CONTRACTS
A Portfolio will not enter into futures contract transactions to the extent
that, immediately thereafter, the sum of its initial margin deposits on open
contracts exceeds 5% of the market value of its total assets. In addition, a
Portfolio will not enter into futures contracts to the extent that its
outstanding obligations to purchase securities under these contracts would
exceed 20% of its total assets.
RISK FACTORS IN FUTURES TRANSACTIONS
A Portfolio will minimize the risk that it will be unable to close out a
futures position by only entering into futures which are traded on national
futures exchanges and for which there appears to be a liquid secondary market.
However, there can be no assurance that a liquid secondary market will exist for
any particular futures contract at any specific time. Thus, it may not be
possible to close a futures position. In the event of adverse price movements, a
Portfolio would continue to be required to make daily cash payments to maintain
its required margin. In such situations, if the Portfolio has insufficient cash,
it may have to sell portfolio securities to meet daily margin requirements at a
time when it may be disadvantageous to do so. In addition, a Portfolio may be
required to make delivery of the instruments underlying futures contracts it
holds. The inability to close futures positions also could have an adverse
impact on a Portfolio's ability to effectively hedge.
The risk of loss in trading futures contracts in some strategies can be
substantial due both to the low margin deposits required and the extremely high
degree of leverage involved in futures pricing. As a result, a relatively small
price movement in a futures contract may result in immediate and substantial
loss (as well as gain) to the investor. For example, if at the time of purchase,
10% of the value of the futures contract is deposited as margin, a subsequent
10% decrease in the value of the futures contract would result in a total loss
of the margin deposit, before any deduction for the transaction costs, if the
account were then closed out. A 15% decrease would result in a loss equal to
150% of the original margin deposit if the contract were closed out. Thus, a
purchase or sale of a futures contract may result in losses in excess of the
amount invested in the contract. However, because the futures strategies of the
Portfolios are engaged in only for hedging purposes, the Adviser does not
believe that the Portfolios are subject to the risks of loss frequently
associated with futures transactions. A Portfolio would presumably have
sustained comparable losses if, instead of the futures contract, it had invested
in the underlying financial instrument and sold it after the decline.
Utilization of futures transactions by the Portfolios does involve the risk of
imperfect or no correlation where the securities underlying the futures
contracts have different maturities than the portfolio securities being hedged.
It is also possible that the Portfolio could lose money on futures contracts and
also experience a decline in value of portfolio securities. There is also the
risk of loss by the Portfolio of margin deposits in the event of bankruptcy of a
broker with whom the Portfolio has an open position in a futures contract or
related option.
Most futures exchanges limit the amount of fluctuation permitted in futures
contract prices during a single trading day. The daily limit establishes the
maximum amount that the price of a futures contract may vary either up or down
from the previous day's settlement price at the end of a trading session. Once
the daily limit has been reached in a particular type of contract, no trades may
be made on that day at a price beyond that limit. The daily limit governs only
price movement during a particular trading day and, therefore, does not limit
potential losses because the limit may prevent the liquidation of unfavorable
positions. Futures contract prices have occasionally moved to the daily limit
for several consecutive trading days, with little or no trading, thereby
preventing prompt liquidation of futures positions and subjecting some futures
traders to substantial losses.
5
<PAGE>
OPTIONS
The Portfolios may purchase and sell put and call options on securities and
futures contracts for hedging purposes. Investments in options involve some of
the same considerations that are involved in connection with investments in
futures contracts (e.g., the existence of a liquid secondary market). In
addition, the purchase of an option also entails the risk that changes in the
value of the underlying security or contract will not be fully reflected in the
value of the option purchased. Depending on the pricing of the option compared
to either the futures contract on which it is based or the price of the
securities being hedged, an option may or may not be less risky than ownership
of the futures contract or such securities. For example, there are significant
differences between the securities, futures and options markets that could
result in an imperfect correlation between these markets, causing a given
transaction not to achieve its objective. A decision as to whether, when, and
how to use options involves the exercise of skill and judgment by the Adviser,
and even a well-conceived transaction may be unsuccessful because of market
behavior or unexpected events.
WRITING COVERED CALL OPTIONS
The principal reason for writing call options is to attempt to realize,
through the receipt of premiums, a greater return than would be realized on
securities alone. By writing covered call options, each Portfolio gives up the
opportunity, while the option is in effect, to profit from any price increase in
the underlying security above the option exercise price. In addition, each
Portfolio's ability to sell the underlying security will be limited while the
option is in effect unless the Portfolio effects a closing purchase transaction.
A closing purchase transaction cancels out the Portfolio's position as the
writer of an option by means of an offsetting purchase of an identical option
prior to the expiration of the option it has written. Covered call options serve
as a partial hedge against the price of the underlying security declining. Each
Portfolio writes only covered options, which means that so long as a Portfolio
is obligated as the writer of the option it will, in a segregated account with
its custodian, maintain cash or liquid securities denominated in U.S. dollars
with a value equal to or greater than the exercise price of the underlying
securities.
PURCHASING OPTIONS
The amount of any appreciation in the value of the underlying security subject
to a put will be partially offset by the amount of the premium paid for the put
option and any related transaction costs. Prior to its expiration, a put option
may be sold in a closing sale transaction and profit or loss from a sale will
depend on whether the amount received is more or less than the premium paid for
the put option plus the related transaction costs. A closing sale transaction
cancels out a Portfolio's position as purchaser of an option by means of an
offsetting sale of an identical option prior to the expiration of the option it
has purchased. In certain circumstances, a Portfolio may purchase call options
on securities held in its investment portfolio on which it has written call
options or on securities which it intends to purchase.
OPTIONS ON FOREIGN CURRENCIES
The Portfolios may purchase and write options on foreign currencies for
hedging purposes in a manner similar to that in which futures contracts on
foreign currencies, or forward contracts, will be utilized. For example, a
decline in the dollar value of a foreign currency in which portfolio securities
are denominated will reduce the dollar value of such securities, even if their
value in the foreign currency remains constant. In order to protect against such
diminutions in the value of portfolio securities, the Portfolios may purchase
put options on the foreign currency. If the value of the currency does decline,
the Portfolio will have the right to sell such currency for a fixed amount in
dollars and will thereby offset, in whole or in part, the adverse effect on its
portfolio which otherwise would have resulted.
Conversely, where a rise in the dollar value of a currency in which securities
to be acquired are denominated is projected, thereby increasing the cost of such
securities, the Portfolios may purchase call options thereon. The purchase of
such options could offset, at least partially, the effects of the adverse
movements in
6
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exchange rates. As in the case of other types of options, however, the benefit
to the Portfolios deriving from purchases of foreign currency options will be
reduced by the amount of the premium and related transaction costs. In addition,
where currency exchange rates do not move in the direction or to the extent
anticipated, a Portfolio could sustain losses on transactions in foreign
currency options which would require it to forego a portion or all of the
benefits of advantageous changes in such rates.
Each Portfolio may write options on foreign currencies for the same types of
hedging purposes. For example, where a Portfolio anticipates a decline in the
dollar value of foreign currency denominated securities due to adverse
fluctuations in exchange rates it could, instead of purchasing a put option,
write a call option on the relevant currency. If the anticipated decline occurs,
the option will most likely not be exercised, and the diminution in value of
portfolio securities will be offset by the amount of the premium received.
Similarly, instead of purchasing a call option to hedge against an anticipated
increase in the dollar cost of securities to be acquired, a Portfolio could
write a put option on the relevant currency which, if rates move in the manner
projected, will expire unexercised and allow the Portfolio to hedge such
increased cost up to the amount of the premium. As in the case of other types of
options, however, the writing of a foreign currency option will constitute only
a partial hedge up to the amount of the premium, and only if rates move in the
expected direction. If this does not occur, the option may be exercised and a
Portfolio would be required to purchase or sell the underlying currency at a
loss which may not be offset by the amount of the premium. Through the writing
of options on foreign currencies, a Portfolio also may be required to forego all
or a portion of the benefits which might otherwise have been obtained from
favorable movements in exchange rates.
Each Portfolio intends to write covered call options on foreign currencies. A
call option written on a foreign currency by a Portfolio is "covered" if the
Portfolio owns the underlying foreign currency covered by the call or has an
absolute and immediate right to acquire that foreign currency without additional
cash consideration (or for additional cash consideration held in a segregated
account by the Custodian) upon conversion or exchange of other foreign currency
held in its portfolio. A call option is also covered if a Portfolio has a call
on the same foreign currency and in the same principal amount as the call
written where the exercise price of the call held (a) is equal to or less than
the exercise price of the call written or (b) is greater than the exercise price
of the call written if the difference is maintained by the Portfolio in cash or
liquid securities in a segregated account with the Custodian.
Each Portfolio also intends to write call options on foreign currencies that
are not covered for cross-hedging purposes. A call option on a foreign currency
is for cross-hedging purposes if it is not covered but is designed to provide a
hedge against a decline in the U.S. dollar value of a security which the
Portfolio owns or has the right to acquire and which is denominated in the
currency underlying the option due to an adverse change in the exchange rate. In
such circumstances, the Portfolio will collateralize the option by maintaining
in a segregated account with the Custodian, cash or liquid securities in an
amount not less than the value of the underlying foreign currency in U.S.
dollars marked to market daily.
RISKS OF OPTIONS ON FUTURES CONTRACTS, FORWARD CONTRACTS AND OPTIONS ON FOREIGN
CURRENCIES
Options on foreign currencies and forward contracts are not traded on contract
markets regulated by the CFTC or (with the exception of certain foreign currency
options) by the SEC. To the contrary, such instruments are traded through
financial institutions acting as market-makers, although foreign currency
options are also traded on certain national securities exchanges, such as the
Philadelphia Stock Exchange and the Chicago Board Options Exchange, subject to
the regulation of the SEC. Similarly, options on currencies may be traded over-
the-counter. In an over-the-counter trading environment, many of the protections
afforded to exchange participants will not be available. For example, there are
no daily price fluctuation limits, and adverse market movements could therefore
continue to an unlimited extent over a period of time. Although the purchaser of
an option cannot lose more than the amount of the premium plus related
transaction costs, this entire amount could be lost. Moreover, the option writer
and a trader of forward contracts could lose amounts substantially in excess of
their initial investments, due to the margin and collateral requirements
associated with such positions.
7
<PAGE>
Options on foreign currencies traded on national securities exchanges are
within the jurisdiction of the SEC, as are other securities traded on such
exchanges. As a result, many of the protections provided to traders on organized
exchanges will be available with respect to such transactions. In particular,
all foreign currency option positions entered into on a national securities
exchange are cleared and guaranteed by the Options Clearing Corporation ("OCC"),
thereby reducing the risk of counterparty default. Furthermore, a liquid
secondary market in options traded on a national securities exchange may be more
readily available than in the over-the-counter market, potentially permitting
the Portfolios to liquidate open positions at a profit prior to exercise or
expiration, or to limit losses in the event of adverse market movements.
The purchase and sale of exchange-traded foreign currency options, however, is
subject to the risks of the availability of a liquid secondary market described
above, as well as the risks regarding adverse market movements, margining of
options written, the nature of the foreign currency market, possible
intervention by governmental authorities and the effect of other political and
economic events. In addition, exchange-traded options of foreign currencies
involve certain risks not presented by the over-the-counter market. For example,
exercise and settlement of such options must be made exclusively through the
OCC, which has established banking relationships in applicable foreign countries
for this purpose. As a result, the OCC may, if it determines that foreign
governmental restrictions or taxes would prevent the orderly settlement of
foreign currency option exercises, or would result in undue burdens on the OCC
or its clearing member, impose special procedures on exercise and settlement,
such as technical changes in the mechanics of delivery of currency, the fixing
of dollar settlement prices or prohibitions, on exercise.
In addition, futures contracts, options on futures contracts, forward
contracts and options on foreign currencies may be traded on foreign exchanges.
Such transactions are subject to the risk of governmental actions affecting
trading in, or the prices of, foreign currencies or securities. The value of
such positions also could be adversely affected by (i) other complex foreign
political and economic factors, (ii) lesser availability than in the United
States of data on which to make a trading decision, (iii) delays in a
Portfolio's ability to act upon economic events occurring in foreign markets
during non-business hours in the United States, (iv) the imposition of different
exercise and settlement terms and procedures and margin requirements than in the
United States, and (v) lesser trading volume.
INTEREST RATE SWAP TRANSACTIONS
Each Portfolio may enter into swap contracts. A swap is an agreement to
exchange the return generated by one instrument for the return generated by
another instrument. The payment streams are calculated by reference to a
specific index and agreed upon notional amount. The term "specified index"
includes fixed interest rates, total return on interest rate indices and fixed
income indices, (as well as amounts derived from arithmetic operations on these
indices). For example, a Portfolio may agree to swap the return generated by a
fixed-income index for the return generated by a second fixed-income index.
The Portfolios will usually enter into swaps on a net basis, i.e., the two
payment streams are netted out in a cash settlement on the payment date or dates
specified in the instrument, with a Portfolio receiving or paying, as the case
may be, only the net amount of the two payments. A Portfolio's obligations under
a swap agreement will be accrued daily (offsetting against any amounts owing to
the Portfolio) and any accrued but unpaid net amounts owed to a swap
counterparty will be covered by the maintenance of a segregated account
consisting of cash or liquid securities, to avoid any potential leveraging of
the Portfolio. Since swaps will be entered into for good faith hedging purposes,
the Adviser and the Fund believe such obligations do not constitute "senior
securities" under the 1940 Act and, accordingly, will not treat them as being
subject to its borrowing restrictions.
Interest rate swaps do not involve the delivery of securities, other
underlying assets, or principal. Accordingly, the risk of loss with respect to
interest rate swaps is limited to the net amount of interest payments that a
Portfolio is contractually obligated to make. If the other party to the interest
rate swap defaults, a Portfolio's risk of loss consists of the net amount of
interest payments that a Portfolio is contractually entitled to receive. If
there is a default by the counterparty, the Portfolio may have contractual
remedies pursuant to the agreements related to the
8
<PAGE>
transaction. The swap market has grown substantially in recent years with a
large number of banks and investment banking firms acting both as principals and
as agents utilizing standardized swap documentation. As a result, the swap
market has become relatively liquid.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectuses is calculated by
dividing the lesser of purchases or sales of portfolio securities for the year
by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of acquisition were one year or less. Portfolio turnover may vary greatly
from year to year as well as within a particular year, and may also be affected
by cash requirements for redemptions of shares. See "Financial Highlights" in
the Prospectuses for the historical portfolio turnover rates with respect to the
Portfolios.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Portfolios may be purchased without a sales commission at the
net asset value per share next determined after an order is received in proper
form by the Fund, and payment is received by the Fund or its designated Service
Agent. The minimum initial investment required for the Portfolios is $2,000,
with certain exceptions as may be permitted from time to time by the officers of
the Fund. Other investment minimums are: initial IRA investment, $500; initial
spousal IRA investment, $250; and additional investment for all accounts, $100.
An order received in proper form prior to the close of regular trading on the
New York Stock Exchange ("Exchange") (generally 4:00 p.m. Eastern Time) will be
executed at the price computed on the date of receipt; and an order received not
in proper form or after the close of the Exchange will be executed at the price
computed on the next day the Exchange is open after proper receipt. The exchange
will be closed on the following days: New Year's Day, Dr. Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day,Thanksgiving Day and Christmas Day.
Each Portfolio reserves the right in its sole discretion (1) to suspend the
offering of its shares, (2) to reject purchase orders when in the judgment of
management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of a Portfolio's shares.
Each Portfolio may suspend redemption privileges or postpone the date of
payment (1) during any period that either the Exchange and custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for a Portfolio to dispose of
securities owned by it or to fairly determine the value of its assets, and (3)
for such other periods as the SEC may permit. The Fund has made an election with
the SEC to pay in cash all redemptions requested by any shareholder of record
limited in amount during any 90-day period to the lesser of $250,000 or 1% of
the net assets of the Fund at the beginning of such period. Such commitment is
irrevocable without the prior approval of the SEC. Redemptions in excess of the
above limits may be paid, in whole or in part, in investment securities or in
cash as the Board of Trustees may deem advisable; however, payment will be made
wholly in cash unless the Board of Trustees believe that economic or market
conditions exist which would make such a practice detrimental to the best
interests of the Fund. If redemptions are paid in investment securities, such
securities will be valued as set forth in the Prospectus under "VALUATION OF
SHARES," and a redeeming shareholder would normally incur brokerage expenses if
those securities were converted to cash.
No charge is made by a Portfolio for redemptions. Any redemption may be more
or less than the shareholder's initial cost depending on the market value of the
securities held by the Portfolio.
SIGNATURE GUARANTEES
9
<PAGE>
To protect your account, the Fund and Chase Global Funds Services Company
("CGFSC") from fraud, signature guarantees are required for certain redemptions.
The purpose of signature guarantees is to verify the identity of the person who
has authorized a redemption from your account. Signature guarantees are
required for (1) all redemptions when the proceeds are to be paid to someone
other than the registered owner(s) and/or registered address, or (2) share
transfer requests.
Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the Fund's transfer agent. Broker-dealers guaranteeing
signatures must be a member of a clearing corporation or maintain net capital of
at least $100,000. Credit unions must be authorized to issue signature
guarantees. Signature guarantees will be accepted from any eligible guarantor
institution which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request for
redemption; (2) on a separate instrument for assignment ("stock power") which
should specify the total number of shares to be redeemed; or (3) on all stock
certificates tendered for redemption and, if shares held by the Fund are also
being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market quotations
are readily available are valued at the last quoted sale price of the day.
Price information on listed securities is taken from the exchange where the
security is primarily traded. Unlisted equity securities and listed securities
not traded on the valuation date for which market quotations are readily
available are valued neither exceeding the current asked prices nor less than
the current bid prices. Quotations of foreign securities in a foreign currency
are converted to U.S. dollar equivalents. The converted value is based upon the
bid price of the foreign currency against U.S. dollars as quoted by any major
bank or broker.
Bonds and other fixed income securities are valued according to the broadest
and most representative market, which will ordinarily be the over-the-counter
market. Bonds and other fixed income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed to reflect
the fair market value of such securities. Securities purchased with remaining
maturities of 60 days or less are valued at amortized cost, using methods
approved by the Board of Trustees.
The value of other assets and securities for which no quotations are readily
available (including restricted securities) is determined in good faith at fair
value using methods approved by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectus.
10
<PAGE>
EXCHANGE PRIVILEGE
Institutional Class Shares of each Portfolio may be exchanged for
Institutional Class Shares of any other UAM Funds or UAM Funds, Inc. Portfolio.
Exchange requests should be made by calling the Fund (1-800-638-7983) or by
writing to UAM Funds, UAM Funds Service Center, c/o Chase Global Funds Services
Company, P.O. Box 2798, Boston, MA 02208-2798. The exchange privilege is only
available with respect to Portfolios that are qualified for sale in the
shareholder's state of residence.
Any such exchange will be based on the respective net asset values of the
shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objective of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the shares
to be exchanged have not been issued to the shareholder, and if the registration
of the two accounts will be identical. Requests for exchanges received prior to
the close of regular trading of the Exchange (generally 4:00 p.m. Eastern Time)
will be processed as of the close of business on the same day. Requests
received after the close of regular trading on the Exchange will be processed on
the next business day. Neither the Fund nor CGFSC will be responsible for the
authenticity of the exchange instructions received by telephone. Exchanges may
also be subject to limitations as to amounts or frequency and to other
restrictions established by the Board of Trustees to assure that such exchanges
do not disadvantage the Fund and its shareholders.
For federal income tax purposes an exchange between Portfolios is a taxable
event, and, accordingly, a capital gain or loss may be realized. In a revenue
ruling relating to circumstances similar to the Fund's, an exchange between
series of a Fund was also deemed to be a taxable event. It is likely, therefore,
that a capital gain or loss would be realized on an exchange between Portfolios;
you may want to consult your tax adviser for further information in this regard.
The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares to another person by making a written request
to the Fund. The request should clearly identify the account and number of
shares to be transferred, and include the signature of all registered owners and
all stock certificates, if any, which are subject to the transfer. The signature
on the letter of request, the stock certificate or any stock power must be
guaranteed in the same manner as described under "Purchase and Redemption of
Shares." As in the case of redemptions, the written request must be received in
good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in the Prospectuses of
the Portfolios. A Portfolio's fundamental investment limitations cannot be
changed without the approval of a "majority of the outstanding shares" (as
defined in the 1940 Act) of the Portfolio. Except for the numbered investment
limitations noted as fundamental below, however, the limitations described below
are not fundamental, and may be changed without the consent of shareholders.
Whenever an investment limitation sets forth a percentage limitation on
investment or utilization of assets, such limitation shall be determined
immediately after and as a result of a Portfolio's acquisition of such security
or other asset. Accordingly, any later increase or decrease resulting from a
change in values, net assets or other circumstances will not be considered when
determining whether the investment complies with a Portfolio's investment
limitations.
As a matter of fundamental policy, each Portfolio will not:
11
<PAGE>
(1) invest in physical commodities or contracts on physical commodities;
(2) purchase or sell real estate or real estate limited partnerships,
although it may purchase and sell securities of companies which deal
in real estate and may purchase and sell securities which are secured
by interests in real estate;
(3) make loans except (i) by purchasing debt securities in accordance with
its investment objectives and (ii) by lending its portfolio securities
to banks, brokers, dealers and other financial institutions so long as
such loans are not inconsistent with the 1940 Act, or the rules and
regulations or interpretations of the SEC thereunder;
(4) underwrite the securities of other issuers; and
(5) issue senior securities, as defined in the 1940 Act, except that this
restriction shall not be deemed to prohibit a Portfolio from (i)
making any permitted borrowings, mortgages or pledges, or (ii)
entering into options, futures or repurchase transactions.
As a matter of non-fundamental policy, each Portfolio will not:
(6) invest in stock, bond or interest rate futures and/or options on
futures unless (i) not more than 5% of the Portfolio's assets are
required as deposit to secure obligations under such futures and/or
options on futures contracts provided, however, that in the case of an
option that is in-the-money at the time of purchase, the in-the-money
amount may be excluded in computing such 5% and (ii) not more than 20%
of the Portfolio's assets are invested in stock or bond futures and
options;
(7) purchase on margin or sell short except as specified in (5) above;
(8) invest more than an aggregate of 15% of the net assets of the
Portfolio, determined at the time of investment, in securities subject
to legal or contractual restrictions on resale or securities for which
there are no readily available markets; and
(9) invest for the purpose of exercising control over management of any
company.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are responsible
to the Fund's Board of Trustees. The Trustees set broad policies for the Fund
and elect its Officers. The following is a list of the Trustees and Officers of
the Fund, their addresses and dates of birth, and a brief statement of their
present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
12
<PAGE>
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated person, a
$150 quarterly retainer fee per active Portfolio which currently amounts to
$1,350 per quarter. In addition, each unaffiliated Trustee receives a $2,000
meeting fee which is aggregated for all the Trustees and allocated
proportionately among the
13
<PAGE>
Portfolios of the Fund and UAM Funds, Inc. and reimbursement for travel and
other expenses incurred while attending Board meetings. Trustees who are also
officers or affiliated persons receive no remuneration for their service as
Trustees. The Fund's officers and employees are paid by either the Adviser,
United Asset Management Corporation ("UAM"), or the Administrator and receive no
compensation from the Fund. As of June 15, 1998, the Trustees and officers of
the Fund owned less than 1% of the Fund's outstanding shares.
The following table shows aggregate compensation paid to each of the Fund's
Trustees by the Fund and total compensation paid by the Funds and UAM Funds,
Inc. (collectively the "Fund Complex") in the fiscal year ended April 30, 1998.
14
<PAGE>
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Aggregate Benefits Accrued Annual from Registrant
Name of Person, Compensation From as Part of Benefits Upon and
Position Registrant Fund Expenses Retirement Fund Complex
-------- ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee.............. $6,149 0 0 $33,500
Philip D. English
Trustee.............. $6,149 0 0 $33,500
William A. Humenuk
Trustee.............. $6,149 0 0 $33,500
Nancy J. Dunn
Trustee.............. $4,668 0 0 $25,200
Peter M. Whitman, Jr.
Trustee $ 0 0 0 $ 0
Norton H. Reamer
Trustee.............. $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of record or
beneficially 5% or more of the shares of a Portfolio:
Chicago Asset Management Value/Contrarian Portfolio Institutional Class
Shares: UMBSC & Co, FBO Interstate Brands Conserv. Growth, P.O. Box 419260,
Kansas City, MO, 47.8%*; UMBSC & Co., FBO Interstate Brands Moderate Growth,
P.O. Box 419260, Kansas City, MO, 28.0%*; UMBSC & Co., FBO Interstate Brands
Aggressive Growth, P.O. Box 419260, Kansas City, MO, 11.5%*; and United Asset
Management Corp., Profit Sharing and 401K Plan Trustees, P.O. Box 1443, Chicago,
IL, 5.6%*.
Chicago Asset Management Intermediate Bond Portfolio Institutional Class
Shares: John D. Curran and Francis McCartin Trustees FBO Pipe Fitters Pension
Fund Local 597, c/o Chicago Asset Management Company, 70 W. Madison, 56th Floor,
Chicago, IL, 89.4%*; and Wilmington Trust Co., Trustee, FBO American Eurocoper
401K Plan, c/o Mutual Funds, 1100 North Market Street, Wilmington, DE,
6.1%*.
15
<PAGE>
- ------------
* Denotes shares held by a trustee or other fiduciary for which beneficial
ownership is disclaimed or presumed disclaimed.
The person(s) or organization(s) listed above as owning 25% or more of the
outstanding shares of the Portfolio may be presumed to "control" (as that term
is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
INVESTMENT ADVISER
CONTROL OF ADVISER
The Adviser is a wholly-owned subsidiary of UAM, a holding company
incorporated in Delaware in December 1980 for the purpose of acquiring and
owning firms engaged primarily in institutional investment management. Since its
first acquisition in August 1983, UAM has acquired or organized over 45 such
wholly-owned affiliated firms (the "UAM Affiliated Firms"). UAM believes that
permitting UAM Affiliated Firms to retain control over their investment advisory
decisions is necessary to allow them to continue to provide investment
management services that are intended to meet the particular needs of their
respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue to
operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc., a registered investment company.
SERVICES PERFORMED BY ADVISER
Pursuant to the Investment Advisory Agreements between each Portfolio of the
Fund and the Adviser (collectively, the "Agreement"), the Adviser has agreed to
manage the investment and reinvestment of the Portfolios' assets, to
continuously review, supervise and administer the Portfolios' investment
program, and to determine in its discretion the securities to be purchased or
sold and the portion of the Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross negligence on
the part of the Adviser in the performance of its obligations and duties under
the Agreement, (ii) reckless disregard by the Adviser of its obligations and
duties under the Agreement, or (iii) a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services, the Adviser shall
not be subject to any liability whatsoever to the Fund, or to any shareholder of
the Fund, for any error of judgment, mistake of law or any other act or omission
in the course of, or connected with, rendering services under the
Agreement.
Unless sooner terminated, the Agreement shall continue for periods of one year
so long as such continuance is specifically approved at least annually (a) by
the vote of a majority of those members of the Board of Trustees of the Fund who
are not parties to the Agreement or interested persons of any such party, cast
in person at a meeting called for the purpose of voting on such approval, (b) by
the Board of Trustees of the Fund, or (c) by vote of a majority of the
outstanding voting securities of the Portfolio. The Agreement may be terminated
at any time by the Portfolio, without the payment of any penalty, by vote of a
majority of the entire Board of Trustees of the Fund or by vote of a majority of
the outstanding voting securities of the Portfolio on 60 days written notice to
the Adviser. The Agreement may be terminated by the Adviser at any time,
without the payment of any penalty, upon 90 days written notice to the Fund.
The Agreement will automatically and immediately terminate in the event of its
assignment.
PHILOSOPHY AND STYLE
16
<PAGE>
Chicago Asset Management Value/Contrarian Portfolio. The Adviser views itself
as an equity manager who, by combining value judgment and contrarian opinion,
strives to outperform the market and other money managers not by market timing,
but by focusing on the selection of individual securities. Categorized as a
large cap, bottom-up, value/contrarian, the Adviser's philosophy and strategy
are qualitative and have remained the same since the inception of the firm.
Chicago Asset Management Intermediate Bond Portfolio. The Adviser's approach
is predicated on a controlled risk strategy that avoids dependence on interest
rate anticipation while emphasizing value added through sector rotation and
yield curve analysis. The firm seeks to add value by improving the odds in a
risk/reward equation. The Adviser focuses on the more traditional aspects of
active portfolio management by scrutinizing sectors, coupons, call features, and
the shape of the yield curve. The Portfolio is constructed for income and
safety.
ADVISORY FEES
As compensation for services rendered by the Adviser under the Investment
Advisory Agreements, the Portfolio pays the Adviser an annual fee in monthly
installments, calculated by applying the following annual percentage rates to
each Portfolio's average daily net assets for the month:
<TABLE>
<CAPTION>
Rate
<S> <C>
Chicago Asset Management Value/Contrarian Portfolio...................... 0.625%
Chicago Asset Management Intermediate Bond Portfolio..................... 0.48%
</TABLE>
For the fiscal years ended April 30, 1996, 1997, and 1998, the Chicago Asset
Management Value/Contrarian Portfolio paid no advisory fees . During these
periods, the Adviser voluntarily waived advisory fees of $5,000, $13,652, and
$120,386, respectively. Until further notice, the Adviser has voluntarily agreed
to waive its advisory fee and to assume as the Adviser's own expense certain
operating expenses payable by the Portfolio (excluding interest, taxes and
extraordinary expenses), if necessary, in order to keep the Portfolio's total
annual operating expenses from exceeding 0.95%.
For the fiscal years ended April 30, 1996, 1997, and 1998, the Chicago Asset
Management Intermediate Bond Portfolio paid no advisory fees. During these
periods, the Adviser voluntarily waived advisory fees of $31,000, $41,438, and
$52,374, respectively. Until further notice, the Adviser has voluntarily agreed
to waive its advisory fee and to assume as the Adviser's own expense certain
operating expenses payable by the Portfolio, if necessary, in order to keep the
Portfolio's total annual operating expenses from exceeding 0.80%.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreements authorize the Adviser to select the brokers
or dealers that will execute the purchases and sales of investment securities
for the Portfolios and directs the Adviser to use its best efforts to obtain the
best execution with respect to all transactions for the Portfolios. The Adviser
may, however, consistent with the interests of the Portfolios, select brokers on
the basis of the research, statistical and pricing services they provide to the
Portfolios. Information and research received from such brokers will be in
addition to, and not in lieu of, the services required to be performed by the
Adviser under the Investment Advisory Agreements. A commission paid to such
brokers may be higher than that which another qualified broker would have
charged for effecting the same transaction, provided that such commissions are
paid in compliance with the Securities Exchange
17
<PAGE>
Act of 1934, as amended, and that the Adviser determines in good faith that such
commission is reasonable in terms either of the transaction or the overall
responsibility of the Adviser to the Portfolios and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect principal
transactions with dealers on the basis of sales of Fund shares which may be made
through broker-dealer firms. However, the Adviser may place portfolio orders
with qualified broker-dealers who refer clients to the Adviser. During the
fiscal years ended April 30, 1996, 1997, and 1998, Chicago Asset Management
Value/Contrarian Portfolio paid aggregate brokerage commissions of $892,
$20,946, and $33,412, respectively. The difference in brokerage commissions paid
between fiscal years April 30, 1997 and 1998, was the result of growth in the
Chicago Asset Management Value/Contrarian Portfolio's assets.
Some securities considered for investment by the Portfolios may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of a Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Board of Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund has approved a Fund Administration Agreement
("Fund Administration Agreement"), effective April 15, 1996, between UAMFSI, a
wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of the Fund
Administration Agreement, UAMFSI manages, administers and conducts the general
business activities of the Fund other than those which have been contracted to
other third parties by the Fund. Additionally, UAMFSI has agreed to provide
transfer agency services to the Portfolio pursuant to the terms of the Fund
Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC, an affiliate of The
Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement between
UAMFSI and CGFSC (collectively, with the Fund Administration Agreement, the
"Agreements").
Pursuant to the terms of the Agreements, each Portfolio pays UAMFSI a two-part
monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a sub-
administration fee which UAMFSI in turn pays to CGFSC. The following Portfolio-
specific fees are calculated from the aggregate net assets of each Portfolio:
Annual Rate
Chicago Asset Management Value/Contrarian Portfolio 0.06%
Chicago Asset Management Intermediate Bond Portfolio 0.04%
CGFSC's monthly fee for its services is calculated on an annualized basis as
follows:
0.19 of 1% of the first $200 million of combined Fund net assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion but
less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
18
<PAGE>
Fees are allocated among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds
Service Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
The following table shows administrative fees paid by each Portfolio
to UAMFSI and CGFSC during the last three fiscal years:
19
<PAGE>
UAMFSI
<TABLE>
<CAPTION>
Fiscal Fiscal
Period ended Year Ended Year Ended
4/30/96 4/30/97 4/30/98
------- ------- -------
<S> <C> <C> <C>
Chicago Asset Management $2,523 $1,287 $11,576
Value/Contrarian Portfolio
Chicago Asset Management $2,640 $3,427 $ 4,364
Intermediate Bond Portfolio
<CAPTION>
CGFSC
Fiscal Fiscal
Period Ended Year Ended Year Ended
4/30/96 4/30/97 4/30/98
------- ------- -------
<S> <C> <C> <C>
Chicago Asset Management $49,477 $74,076 $73,676
Value/Contrarian Portfolio
Chicago Asset Management $48,360 $76,798 $78,912
Intermediate Bond Portfolio
</TABLE>
UAMFSI will bear all expenses in connection with the performance of its
services under the Fund Administration Agreement. Other expenses to be incurred
in the operation of the Fund will be borne by the Fund or other parties,
including taxes, interest, brokerage fees and commissions, if any, salaries and
fees of officers and members of the Board who are not officers, directors,
shareholders or employees of UAMFSI, or the Fund's investment adviser or
distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration Agreement
shall continue in effect from year to year provided such continuance is
specifically approved at least annually by the Board. The Fund Administration
Agreement is terminable, without penalty, by the Board or by UAMFSI, on not less
than ninety (90) days' written notice. The Fund Administration Agreement shall
automatically terminate upon its assignment by UAMFSI without the prior written
consent of the Fund.
UAMFSI will from time to time employ or associate with such person or persons
as may be fit to assist them in the performance of the Fund Administration
Agreement. Such person or persons may be
20
<PAGE>
officers and employees who are employed by both UAMFSI and the Fund. The
compensation of such person or persons for such employment shall be paid by
UAMFSI and no obligation will be incurred by or on behalf of the Fund in such
respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Chicago Asset
Management Value/Contrarian Portfolio and the Chicago Asset Management
Intermediate Bond Portfolio paid the Service Provider $656 and $1,520,
respectively, in fees pursuant to the Services Agreement, all of which were
voluntarily waived.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New York 11245,
provides for the custody of the Fund's assets pursuant to the terms of a
custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110, serves as
independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves as the
Fund's Distributor. Shares of the Fund are offered continuously. While the
Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares. The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
April 30, 1998.
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolios may from time to time quote various performance figures to
illustrate past performance. Performance quotations by investment companies are
subject to rules adopted by the SEC, which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by the Portfolio be accompanied by certain
standardized performance information computed as required by the SEC. Current
yield and average annual compounded total return quotations used by the
Portfolio are based on the standardized methods of computing performance
mandated by the SEC. An explanation of those methods used to compute or express
performance follows.
YIELD
Current yield reflects the income per share earned by a Portfolio's
investment. The current yield of a Portfolio is determined by dividing the net
investment income per share earned during a 30-day base period by the maximum
offering price per share on the last day of the period and annualizing the
result. Expenses accrued for the period include any fees charged to all
shareholders during the base period. The yield for the Chicago Asset Management
Intermediate Bond Portfolio for the 30-day period ended April 30, 1998 was
5.20%.
A yield figure is obtained using the following formula:
21
<PAGE>
Yield = 2[(a - b + 1)/6/ - 1]
-----
cd
22
<PAGE>
where:
a = dividends and interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding during the period
that were entitled to receive income distributions
d = the maximum offering price per share on the last day of the
period.
TOTAL RETURN
The average annual total return of a Portfolio is determined by finding the
average annual compounded rates of return over 1, 5 and 10 year periods that
would equate an initial hypothetical $1,000 investment to its ending redeemable
value. The calculation assumes that all dividends and distributions are
reinvested when paid. The quotation assumes the amount was completely redeemed
at the end of each 1, 5 and 10 year period and the deduction of all applicable
Portfolio expenses on an annual basis.
The average annual total return for the Chicago Asset Management
Intermediate Bond Portfolio and Chicago Asset Management Value/Contrarian
Portfolio from inception and for the one year period ended on the date of the
Financial Statements included herein are as follows:
<TABLE>
<CAPTION>
Average Annual Since
One Year Ended Inception Through Year
April 30, 1998 Ended April 30, 1998 Inception Date
-------------- ----------------------- --------------
<S> <C> <C> <C>
Intermediate Bond Portfolio........... 8.08% 7.85% 1/24/95
Value/Contrarian Portfolio............ 31.71% 21.97% 12/16/94
</TABLE>
These figures are calculated according to the following formula:
P(1 + T)n = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made at
the beginning of the 1, 5 or 10 year periods at the end of the 1,
5 or 10 year periods (or fractional portion thereof).
COMPARISONS
To help investors better evaluate how an investment in either Portfolio of
the Fund might satisfy their investment objective, advertisements regarding the
Portfolios may discuss various measures of Portfolio performance as reported by
various financial publications. Advertisements may also compare performance (as
calculated above) to performance as reported by other investments, indices and
averages. Please see Appendix B for publications, indices and averages which may
be used.
In assessing such comparisons of performance, an investor should keep in
mind that the composition of the investments in the reported indices and
averages is not identical to the composition of investments in a Portfolio, that
the averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
23
<PAGE>
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name The Regis Fund II as a Delaware
business trust on May 18, 1994. On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust". The Fund's principal executive office is located
at One International Place, 44th Floor, Boston, MA 02110; however, all investor
correspondence should be addressed to the Fund at UAM Funds Service Center, c/o
Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
Fund's Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest, without par value. The Trustees have
the power to designate one or more series ("Portfolios") or classes of shares of
beneficial interest without further action by shareholders.
The Board of Trustees has classified two additional classes of shares in
each of the Portfolios, known as Institutional Service Shares and Advisor
Shares. As of the date of this Statement of Additional Information, no
Institutional Service Shares or Advisor Shares have been offered by these
Portfolios.
The shares of the Portfolios, when issued and paid for as provided for in
their Prospectuses, will be fully paid and nonassessable, have no preference as
to conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolios have noncumulative voting
rights, which means that the holders of more than 50% of the shares voting for
the election of Trustees can elect 100% of the Trustees if they choose to do so.
A shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
represent an interest in the same assets of a Portfolio and are identical in all
respects except that the Service Class Shares bear certain expenses related to
shareholder servicing and the distribution of such shares, and have exclusive
voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the shares of each
Portfolio or any class thereof that has been established and designated shall be
entitled to receive, when and as declared by the Trustees, the excess of the
assets belonging to that Portfolio, or in the case of a class, belonging to that
Portfolio and allocable to that class, over the liabilities belonging to that
Portfolio or class. The assets so distributable to the holders of shares of any
particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of each Portfolio's
net investment income, if any, together with any net realized capital gains
annually in the amount and at the times that will avoid both income (including
capital gains) taxes incurred and the imposition of the federal excise tax on
undistributed income and capital gains. The amounts of any income dividends or
capital gains distributions cannot be predicted. See discussion under
"DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES" in the Prospectuses.
24
<PAGE>
Any dividend or distribution paid shortly after the purchase of shares of a
Portfolio by an investor may have the effect of reducing the per share net asset
value of the portfolio by the per share amount of the dividend or distribution.
Furthermore, such dividends or distributions, although in effect a return of
capital, are subject to income taxes as set forth in the Prospectuses.
As set forth in the Prospectuses, unless the shareholder elects otherwise in
writing, all dividend and capital gains distributions are automatically
reinvested in additional shares of the respective Portfolio of the Fund at net
asset value (as of the business day following the record date). This will remain
in effect until the Fund is notified by the shareholder in writing at least
three days prior to the record date that either the Income Option (income
dividends in cash and capital gains distributions in additional shares at net
asset value) or the Cash Option (both income dividends and capital gains
distributions in cash) has been elected. An account statement is sent to
shareholders whenever an income dividend or capital gains distribution is
paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain extent
personal transactions by access persons of the fund and imposes certain
disclosure and reporting obligations.
25
<PAGE>
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's Annual
Report to Shareholders (the "1998 Annual Report") are incorporated by reference
into this Statement of Additional Information. No other parts of the 1998 Annual
Report are incorporated by reference herein. The Financial Statements included
in the 1998 Annual Report have been audited by the Fund's independent
accountants, PricewaterhouseCoopers LLP. The reports of PricewaterhouseCoopers
LLP are incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such reports given upon the authority of
PricewaterhouseCoopers LLP as experts in accounting and auditing. Copies of the
1998 Annual Report may be obtained free of charge by telephoning the UAM Funds
Service Center at the telephone number appearing on the front page of this
Statement of Additional Information.
26
<PAGE>
APPENDIX A -- DESCRIPTION OF SECURITIES AND CORPORATE BOND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
Moody's Investors Service Corporate Bond Ratings:
Aaa -- Bonds which are rated Aaa are judged to be 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.
Moody's Investors Service ("Moody's") applies numerical modifiers 1, 2 and
3 in the Aa and A rating categories. The modifier 1 indicates that the security
ranks at a higher end of the rating category, modifier 2 indicates a mid-range
rating and the modifier 3 indicates that the issue ranks at the lower end of the
rating category.
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 which are 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 which are 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 which are rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to principal
or interest.
Ca -- Bonds which are rated Ca represent obligations which are speculative
in a high degree. Such issues are often in default or have other marked
shortcomings.
C -- Bonds which are rated C are the lowest rated class of bonds, and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
Standard & Poor's Corporation's Corporate Bond Ratings:
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
A-1
<PAGE>
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to 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 -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
BB, B, CCC, CC -- Debt rated BB, B, CCC and CC is regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.
C -- The rating C is reserved for income bonds on which no interest is
being paid.
D -- Debt rated D is in default, and payment of interest and/or repayment
of principal is in arrears.
II. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
and may not be able to assess a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the GNMA are, in effect, backed
by the full faith and credit of the United States through provisions in their
charters that they may make "indefinite and unlimited" drawings on the U.S.
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and FNMA, is not
guaranteed by the United States, but those institutions are protected by the
discretionary authority of the U.S. Treasury to purchase certain amounts of
their securities to assist the institution in meeting its debt obligations.
Finally, other agencies and instrumentalities, such as the Farm Credit System
and the FHLMC, are federally chartered institutions under government
supervision, but their debt securities are backed only by the creditworthiness
of those institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
A-2
<PAGE>
III. DESCRIPTION OF COMMERCIAL PAPER
The Portfolios may invest in commercial paper (including variable amount
master demand notes) rated A-1 or better by Standard & Poor's Corporation
("S&P") or Prime-1 by Moody's or by S&P. Commercial paper refers to short-term,
unsecured promissory notes issued by corporations to finance short-term credit
needs. Commercial paper is usually sold on a discount basis and has a maturity
at the time of issuance not exceeding nine months. Variable amount master demand
notes are demand obligations that permit the investment of fluctuating amounts
at varying market rates of interest pursuant to arrangement between the issuer
and a commercial bank acting as agent for the payees of such notes whereby both
parties have the right to vary the amount of the outstanding indebtedness on the
notes. As variable amount master demand notes are direct lending arrangements
between a lender and a borrower, it is not generally contemplated that such
instruments will be traded, and there is no secondary market for these notes,
although they are redeemable (and thus immediately repayable by the borrower) at
face value, plus accrued interest, at any time. In connection with the
Portfolio's investment in variable amount master demand notes, the Adviser's
investment management staff will monitor, on an ongoing basis, the earning
power, cash flow and other liquidity ratios of the issuer and the borrower's
ability to pay principal and interest on demand.
Commercial paper rated A-1 by S&P has the following characteristics: (1)
liquidity ratios are adequate to meet cash requirements; (2) long-term senior
debt is rated "A" or better; (3) the issuer has access to at least two
additional channels of borrowing; (4) basic earnings and cash flow have an
upward trend with allowance made for unusual circumstances; (5) typically, the
issuer's industry is well established, and the issuer has a strong position
within the industry; and (6) the reliability and quality of management are
unquestioned. Relative strength or weakness of the above factors determine
whether the issuer's commercial paper is A-1, A-2 or A-3. The rating Prime-1 is
the highest commercial paper rating assigned by Moody's. Among the factors
considered by Moody's in assigning ratings are the following: (1) evaluation of
the management of the issuer; (2) economic evaluation of the issuer's industry
or industries and the appraisal of speculative-type risks which may be inherent
in certain areas; (3) evaluation of the issuer's products in relation to
completion and customer acceptance; (4) liquidity; (5) amount and quality of
long term debt; (6) trend of earnings over a period of ten years; (7) financial
strength of a parent company and the relationships which exist with the issuer;
and (8) recognition by the management of issuer of obligations which may be
present or may arise as a result of public interest questions and preparations
to meet such obligations.
IV. DESCRIPTION OF BANK OBLIGATIONS
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Certificates of deposit are negotiable short-term obligations of commercial
banks. Variable rate certificates of deposit are certificates of deposit on
which the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. As a result of these adjustments, the
interest rate on these obligations may increase or decrease periodically.
Frequently, dealers selling variable rate certificates of deposit to the
Portfolios will agree to repurchase such instruments, at a Portfolio's option,
at par on or near the coupon dates. The dealers' obligations to repurchase these
instruments are subject to conditions imposed by various dealers. Such
conditions typically are the continued credit standing of the issuer and the
existence of reasonably orderly market conditions. The Portfolios are also able
to sell variable rate certificates of deposit in the secondary market. Variable
rate certificates of deposit normally carry a higher interest rate than
comparable fixed rate certificates of deposit. A banker's acceptance is a time
draft drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction to finance the import, export, transfer or
storage of goods. The borrower is liable for payment as well as the bank which
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
the secondary markets prior to maturity.
A-3
<PAGE>
APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an unmanaged
index composed of 30 blue-chip industrial corporation stocks (Dow
Jones Industrial Average), 15 utilities company stocks and 20
transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic stocks
chosen for market size, liquidity, and industry group representation.
It is also a market-value weighted index and was the first benchmark
of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation and
finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents the
return on the market value of all common equity securities for which
daily pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed Income
Fund Performance Analysis -- measure total return and average current
yield for the mutual fund industry. Rank individual mutual fund
performance over specified time periods, assuming reinvestment of all
distributions, exclusive of any applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at maximum
capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions.
(h) Lipper Small Cap Funds Index- a fund that by prospectus or portfolio
practice invests primarily in companies with market capitalizations of
less than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index --
respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges of
countries in Europe, Australia and the Far East, and over 1,400
securities listed on the stock exchanges of these continents,
including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated by
screening for convertible issues of 100 million or greater in market
capitalization. The index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages originated
by private lenders and guaranteed by the mortgage pools of the
Government National Mortgage Association.
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA. It
is a value-weighted, total return index, including approximately 800
issues with maturities of 12 years or greater.
(m) Salomon Brothers Broad Investment Grade Bond Index -- is a market-
weighted index that contains approximately 4,700 individually priced
investment grade corporate bonds rated BBB or better, U.S.
Treasury/agency issues and mortgage pass through securities.
B-1
<PAGE>
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of all
bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of the
Government and Corporate Bond Indices. The Government Index includes
public obligations of the U.S. Treasury, issues of Government
agencies, and corporate debt backed by the U.S. Government. The
Corporate Bond Index includes fixed-rate nonconvertible corporate
debt. Also included are Yankee Bonds and nonconvertible debt issued by
or guaranteed by foreign or international governments and agencies.
All issues are investment grade (BBB) or higher, with maturities of at
least one year and an outstanding par value of at least $100 million
for U.S. Government issues and $25 million for others. Any security
downgraded during the month is held in the index until month-end and
then removed. All returns are market value weighted inclusive of
accrued income.
(p) NASDAQ Industrial Index -- is composed of more than 3,000 industrial
issues. It is a value-weighted index calculated on price change only
and does not include income.
(q) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(r) Russell 2000 Index -- composed of the 2,000 smallest stocks in the
Russell 3000, a market value-weighted index of the 3,000 largest U.S.
publicly-traded companies.
(s) Salomon Brothers 3 Month T-Bill Average - the average return for all
Treasury bills for the previous three month period.
(t) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30% Lehman
Brothers Long-Term Treasury Bond and 10% U.S. Treasury Bills; 70%
Standard & Poor's 500 Stock Index and 30% NASDAQ Industrial Index; 35%
Standard & Poor's 500 Stock Index and 65% Salomon Brothers High Grade
Bond Index; all stocks on the NASDAQ system exclusive of those traded
on an exchange, and 65% Standard & Poor's 500 Stock Index and 35%
Salomon Brothers High Grade Bond Index.
(u) CDA Mutual Fund Report published by CDA Investment Technologies, Inc.
-- analyzes price, current yield, risk, total return and average rate
of return (average compounded growth rate) over specified time periods
for the mutual fund industry.
(v) Mutual Fund Source Book published by Morningstar, Inc. -- analyzes
price, yield, risk and total return for equity funds.
(w) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest, Financial
Times, Global Investor, Wall Street Journal and Weisenberger
Investment Companies Service -- publications that rate fund
performance over specified time periods.
(x) Consumer Price Index (or Cost of Living Index), published by the U.S.
Bureau of Labor Statistics -- a statistical measure of change over
time in the price of goods and services in major expenditure groups.
(y) Stocks, Bonds, Bills and Inflation, published by Ibbotson Associates -
- historical measure of yield, price and total return for common and
small company stock, long-term government bonds, U.S. Treasury bills
and inflation.
(z) Savings and Loan Historical Interest Rates -- as published by the U.S.
Savings & Loan League Fact Book.
B-2
<PAGE>
(aa) Historical data supplied by the research departments of First Boston
Corporation; the J.P. Morgan companies; Salomon Brothers; Merrill
Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and Bloomberg
L.P.
B-3
<PAGE>
PART B
UAM FUNDS
FPA CRESCENT PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectuses of the UAM Funds Trust for
the FPA Crescent Portfolio dated July 17, 1998 (the "Portfolio") relating to
the Portfolio's Institutional Class Shares and Institutional Service Class
Shares ("Service Class Shares"). To obtain the Prospectuses, please call the
UAM Funds Service Center at 1-800-638-7983.
TABLE OF CONTENTS
<TABLE>
<S> <C>
INVESTMENT OBJECTIVE AND POLICIES....................................... 2
PURCHASE AND REDEMPTION OF SHARES....................................... 8
VALUATION OF SHARES..................................................... 9
SHAREHOLDER SERVICES.................................................... 9
MANAGEMENT OF THE FUND.................................................. 10
INVESTMENT ADVISER...................................................... 12
SERVICE AND DISTRIBUTION PLANS.......................................... 14
PORTFOLIO TRANSACTIONS.................................................. 16
ADMINISTRATIVE SERVICES................................................. 16
CUSTODIAN............................................................... 18
INDEPENDENT ACCOUNTANTS................................................. 18
DISTRIBUTOR............................................................. 18
PERFORMANCE CALCULATIONS................................................ 18
GENERAL INFORMATION..................................................... 19
FINANCIAL STATEMENTS.................................................... 20
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS..................... A-1
APPENDIX B - COMPARISONS................................................ B-1
</TABLE>
Investment Adviser
First Pacific Advisors, Inc. (Adviser)
Distributor
UAM Fund Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of the Portfolio's
investment objective and policies as set forth in the Portfolio's Prospectuses
for the Institutional Class Shares and Service Class Shares.
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest-bearing short-term investments). The Portfolio will
not loan securities to the extent that greater than one third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as discussed below and in the
Prospectuses.
REPURCHASE AGREEMENTS
The Portfolio may enter into repurchase agreements as discussed in the
Prospectuses. Under such agreements, the seller of the security agrees to
repurchase it at a mutually agreed upon time and price. The repurchase price may
be higher than the purchase price, the difference being income to the Portfolio,
or the purchase and repurchase prices may be the same, with interest at a stated
rate due to the Portfolio together with the repurchase price at the time of
repurchase. In either case, the income to the Portfolio is unrelated to the
interest rate on the security itself. The Portfolio will generally enter into
repurchase agreements of short durations, from overnight to one week, although
the underlying securities generally have longer maturities. The Portfolio may
not enter into a repurchase agreement with more than seven days to maturity if,
as a result, more than 15% of the value of the Portfolio's total assets would be
invested in illiquid securities including such repurchase agreements.
For purposes of the 1940 Act, a repurchase agreement is deemed to be a
loan from the Portfolio to the seller of the U.S. Government security subject to
the repurchase agreement. It is not clear whether a court would consider the
U.S. Government security acquired by the Portfolio subject to a repurchase
agreement as being owned by the Portfolio or as being collateral for a loan by
the Portfolio to the seller. In the event of the commencement of bankruptcy or
insolvency proceedings with respect to the seller of the U.S. Government
security before its repurchase under a repurchase agreement, the Portfolio may
encounter delays and incur costs before being able to sell the security. Delays
may involve loss of interest or a decline in price of the U.S. Government
security. If a court characterizes the transaction as a loan and the Portfolio
has not perfected a security interest in the U.S. Government security, the
Portfolio may be required to return the security to the seller's estate and be
treated as an unsecured creditor of the seller. As an unsecured creditor, the
Portfolio would be at the risk of losing some or all of the principal and income
involved in the transaction. As with any unsecured debt instrument purchased for
the Portfolio, the investment manager seeks to minimize the risk of loss through
repurchase agreements by analyzing the creditworthiness of the obligor, in this
case the seller of the security.
Apart from the risk of bankruptcy or insolvency proceedings, there is
also the risk that the seller may fail to repurchase the security. However, the
Portfolio will always receive as collateral for any repurchase agreement
securities acceptable to it, the market value of which is equal to at least 100%
of the amount invested by the
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<PAGE>
Portfolio plus accrued interest, and the Portfolio will make payment against
such securities only upon physical delivery or evidence of book entry transfer
to the account of its Custodian. If the market value of the U.S. Government
security subject to the repurchase agreement becomes less than the repurchase
price (including interest), the Portfolio will direct the seller of the U.S.
Government security to deliver additional securities so that the market value of
all securities subject to the repurchase agreement will equal or exceed the
repurchase price. It is possible that the Portfolio will be unsuccessful in
seeking to impose on the seller a contractual obligation to deliver additional
securities.
WHEN-ISSUED SECURITIES
The Portfolio may from time to time purchase securities on a "when-
issued" basis. The price of such securities, which may be expressed in yield
terms, is fixed at the time the commitment to purchase is made, but delivery and
payment for the when-issued securities take place at a later date. Normally, the
settlement date occurs within one month of the purchase; during the period
between purchase and settlement, no payment is made by the Portfolio to the
issuer and no interest accrues to the Portfolio. To the extent that assets of
the Portfolio are held in cash pending the settlement of a purchase of
securities, the Portfolio would earn no income; however, it is the Portfolio's
intention to be fully invested to the extent practicable and subject to the
policies stated above. While when-issued securities may be sold prior to the
settlement date, the Portfolio intends to purchase such securities with the
purpose of actually acquiring them unless a sale appears desirable for
investment reasons. At the time the Portfolio makes the commitment to purchase a
security on a when-issued basis, it will record the transaction and reflect the
value of the security in determining its net asset value. The market value of
the when-issued securities may be more or less than the purchase price. The
Portfolio does not believe that its net asset value or income will be adversely
affected by its purchase of securities on a when-issued basis. The Portfolio
will establish a segregated account with its Custodian in which it will maintain
cash or liquid securities equal in value to commitments for when-issued
securities. Such segregated securities either will mature or, if necessary, be
sold on or before the settlement date.
FOREIGN SECURITIES
Among the means through which the Portfolio may invest in foreign
securities is the purchase of American Depository Receipts ("ADRs") or European
Depository Receipts ("EDRs"). Generally, ADRs, in registered form, are
denominated in U.S. dollars and are designed for use in the U.S. securities
markets, while EDRs, in bearer form, may be denominated in other currencies and
are designed for use in European securities markets. ADRs are receipts typically
issued by a U.S. bank or trust company evidencing ownership of the underlying
securities. EDRs are European receipts evidencing a similar arrangement. For
purposes of the Portfolio's investment policies, ADRs and EDRs are deemed to
have the same classification as the underlying securities they represent. Thus
an ADR or EDR representing ownership of common stock will be treated as common
stock.
DEBT SECURITIES AND RATINGS
Ratings of debt securities represent the rating agencies' opinions
regarding their quality, are not a guarantee of quality and may be reduced after
the Portfolio has acquired the security. The Advisor will consider whether the
Portfolio should continue to hold the security but is not required to dispose of
it. Credit ratings attempt to evaluate the safety of principal and interest
payments and do not evaluate the risks of fluctuations in market value. Also,
rating agencies may fail to make timely changes in credit ratings in response to
subsequent events, so that an issuer's current financial conditions may be
better or worse than the rating indicates.
The Portfolio reserves the right to invest up to 30% of its total
assets in securities rated lower than BBB by S & P or lower than Baa by Moody's
Investors Service. Lower rated securities generally offer a higher current
yield than that available for higher grade issues. However, lower rated
securities involve higher risks, in that they are especially subject to adverse
changes in general economic conditions and in the industries in which the
issuers are engaged, to changes in the financial condition of the issuers and to
price fluctuations in response to changes in interest rates. During periods of
economic downturn or rising interest rates, highly leveraged issuers may
experience financial stress which could adversely affect their ability to make
payments of interest and principal and increase the possibility of default. In
addition, the market for lower rated debt securities has expanded rapidly in
recent years,
3
<PAGE>
and its growth paralleled a long economic expansion. At times in recent years,
the prices of many lower rated debt securities have declined substantially,
reflecting an expectation that many issuers of such securities might experience
financial difficulties. As a result, the yields on lower rated debt securities
rose dramatically, but such higher yields did not reflect the value of the
income stream that holders of such securities expected, but rather, the risk
that holders of such securities could lose a substantial portion of their value
as a result of the issuers' financial restructuring or default. There can be no
assurance that such declines will not recur. The market for lower-rated debt
issues generally is thinner and less active than that for higher quality
securities, which may limit the Portfolio's ability to sell such securities at
fair value in response to changes in the economy or financial markets. Adverse
publicity and investor perceptions, whether or not based on fundamental
analysis, may also decrease the values and liquidity of lower rated securities,
especially in a thinly traded market.
SHORT SALES
The Portfolio may seek to hedge investments or realize additional
gains through short sales. The Portfolio may make short sales, which are
transactions in which the Portfolio sells a security it does not own, in
anticipation of a decline in the market value of that security. To complete such
a transaction, the Portfolio must borrow the security to make delivery to the
buyer. The Portfolio then is obligated to replace the security borrowed by
purchasing it at the market price at or prior to the time of replacement. The
price at such time may be more or less than the price at which the security was
sold by the Portfolio. Until the security is replaced, the Portfolio is required
to repay the lender any dividends or interest that accrue during the period of
the loan. To borrow the security, the Portfolio also may be required to pay a
premium, which would increase the cost of the security sold. The net proceeds of
the short sale will be retained by the broker, to the extent necessary to meet
margin requirements, until the short position is closed out. The Portfolio also
will incur transaction costs in effecting short sales.
The Portfolio will incur a loss as a result of the short sale if the
price of the security increases between the date of the short sale and the date
on which the Portfolio replaces the borrowed security. The Portfolio will
realize a gain if the security declines in price between those dates. The amount
of any gain will be decreased, and the amount of any loss increased by the
amount of the premium, dividends, interest, or expenses the Portfolio may be
required to pay in connection with a short sale.
No securities will be sold short if, after effect is given to any such
short sale, the total market value of all securities sold short would exceed 25%
of the value of the Portfolio's net equity. The Portfolio similarly will limit
its short sales of the securities of any single issuer if the market value of
the securities that have been sold short by the Portfolio would exceed the two
percent (2%) of the value of the Portfolio's net equity or if such securities
would constitute more than two percent (2%) of any class of the issuer's
securities.
Whenever the Portfolio engages in short sales, its custodian
segregates an amount of cash or liquid securities equal to the difference
between (a) the market value of the securities sold short at the time they were
sold short and (b) any cash or U.S. Government securities required to be
deposited with the broker in connection with the short sale (not including the
proceeds from the short sale). The segregated assets are marked to market daily,
provided that at no time will the amount deposited in the segregated account
plus the amount deposited with the broker be less than the market value of the
securities at the time they were sold short.
In addition, the Portfolio may make short sales "against the box,"
i.e. when a security identical to one owned by the Portfolio is borrowed and
sold short. If the Portfolio enters into a short sale against the box, it is
required to segregate securities equivalent in kind and amount to the securities
sold short (or securities convertible or exchangeable into such securities) and
is required to hold such securities while the short sale is outstanding. The
Portfolio will incur transaction costs, in connection with opening, maintaining,
and closing short sales against the box.
4
<PAGE>
OPTIONS AND FUTURES TRANSACTIONS
As indicated in the Prospectuses, to the extent consistent with its
investment objectives and policies, the Portfolio may purchase and write call
and put options on securities, securities indexes and on foreign currencies and
enter into futures contracts and use options on futures contracts, to the extent
of up to 5% of its assets.
Transactions in options on securities and on indexes involve certain
risks. For example, there are significant differences between the securities and
options markets that could result in an imperfect correlation between these
markets, causing a given transaction not to achieve its objectives. A decision
as to whether, when and how to use options involves the exercise of skill and
judgment, and even a well-conceived transaction may be unsuccessful to some
degree because of market behavior or unexpected events.
There can be no assurance that a liquid market will exist when the
Portfolio seeks to close out an option position. If the Portfolio were unable to
close out an option that it had purchased on a security, it would have to
exercise the option in order to realize any profit or the option may expire
worthless. If the Portfolio were unable to close out a covered call option that
it had written on a security, it would not be able to sell the underlying
security unless the option expired without exercise. As the writer of a covered
call option, the Portfolio forgoes, during the option's life, the opportunity to
profit from increases in the market value of the security covering the call
option above the sum of the premium and the exercise price of the call.
If trading were suspended in an option purchased by the Portfolio, the
Portfolio would not be able to close out the option. If restrictions on exercise
were imposed, the Portfolio might be unable to exercise an option it has
purchased. Except to the extent that a call option on an index written by the
Portfolio is covered by an option on the same index purchased by the Portfolio,
movements in the index may result in a loss to the Portfolio; such losses may be
mitigated or exacerbated by changes in the value of the Portfolio's securities
during the period the option was outstanding.
Use of futures contracts and options thereon also involves certain
risks. The variable degree of correlation between price movements of futures
contracts and price movements in the related portfolio positions of the
Portfolio creates the possibility that losses on the hedging instrument may be
greater than gains in the value of the Portfolio's position. Also, futures and
options markets may not be liquid in all circumstances and certain over-the-
counter options may have no markets. As a result, in certain markets, the
Portfolio might not be able to close out a transaction at all or without
incurring losses. Although the use of options and futures transactions for
hedging should minimize the risk of loss due to a decline in the value of the
hedged position, at the same time it tends to limit any potential gain which
might result from an increase in the value of such position. If losses were to
result from the use of such transactions, they could reduce net asset value and
possibly income. The Portfolio may use these techniques to hedge against changes
in interest rates or securities prices or as part of its overall investment
strategy. The Portfolio will maintain segregated accounts consisting of cash or
liquid securities (or, as permitted by applicable regulation, enter into certain
offsetting positions) to cover its obligations under options and futures
contracts to avoid leveraging of the Portfolio.
INFLATION-INDEXED BONDS
Inflation-indexed bonds issued by the U.S. Treasury pay interest on a
semi-annual basis, equal to a fixed percentage of the inflation-adjusted
principal amount. For example, if a fund purchased an inflation-indexed bond
with a par value of $1,000 and a 3% real rate of return coupon (payable 1.5%
semi-annually), and inflation over the first six months was 1%, the mid-year
par value of the bond would be $1,010 and the first semi-annual interest payment
would be $15.15 ($1,010 times 1.5%). If inflation continued during the second
half of the year and reached 3% by year end, the end-of-year par value of the
bond would be $1,030 and the second semi-annual interest payment would be $15.45
($1,030 times 1.5%).
5
<PAGE>
The value of inflation-indexed bonds is expected to change in response
to changes in real interest rates. Real interest rates in turn are tied to the
relationship between nominal interest rates and the rate of inflation.
Therefore, if inflation were to rise faster than nominal interest rates, real
interest rates might decline, leading to an increase in the value of inflation-
indexed bonds. In contrast, if nominal interest rates increased at a faster rate
than inflation, real interest might rise, leading to a decrease in the value of
inflation-indexed bonds.
While these securities are expected to be protected from long-term
inflationary trends, short-term increases in inflation may lead to a decline in
value. If interest rates rise due to reasons other than inflation (for example,
due to changes in currency exchange rates), investors in these securities may
not be protected to the extent that the increase is not reflected in the bond's
inflation measure.
The periodic adjustment of the U.S. inflation-indexed bonds is tied to
the Consumer Price Index for Urban Consumers ("CPI-U"), which is calculated
monthly by the U.S. Bureau of Labor Statistics. The CPI-U is a measurement of
changes in the cost of living, made up of components such as housing, food,
transportation and energy. There can be no assurance that the CPI-U will
accurately measure the real rate of inflation in the prices of goods and
services.
INVESTMENT RESTRICTIONS
The following limitations supplement those set forth in the
Prospectuses of the Portfolio. The Portfolio's fundamental investment
limitations cannot be changed without the approval of a "majority of the
outstanding shares" (as defined in the 1940 Act) of the Portfolio. Except for
the numbered investment limitations noted as fundamental below however, the
limitations described below are not fundamental, and may be changed without the
consent of shareholders. Whenever an investment limitation sets forth a
percentage limitation on investment or utilization of assets, such limitation
shall be determined immediately after and as a result of the Portfolio's
acquisition of such security or other asset. Accordingly, any later increase or
decrease resulting from a change in values, net assets or other circumstances
will not be considered when determining whether the investment complies with the
Portfolio's investment limitations.
As a matter of fundamental policy, the Portfolio will not:
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<PAGE>
(1) make loans to others, except (i) through the purchase of debt
securities in accordance with its investment objective and policies,
and (ii) to the extent the entry into a repurchase agreement is deemed
to be a loan;
(2) (i) borrow money, except as stated in the Prospectuses and this SAI.
Any such borrowing will be made only if immediately thereafter there
is an asset coverage of at least 300% of all borrowings; (ii)
mortgage, pledge or hypothecate any of its assets except in connection
with any such borrowings;
(3) purchase securities on margin, participate on a joint or joint and
several basis in any securities trading account, or underwrite
securities (does not preclude the Portfolio from obtaining such short-
term credit as may be necessary for the clearance of purchases and
sales of its portfolio securities);
(4) purchase or sell commodities or commodity contracts (other than
futures transactions for the purposes and under the conditions
described in the Prospectuses and in this SAI);
(5) invest more than 25% of the market value of its assets in the
securities of companies engaged in any one industry (does not apply to
investment in the securities of the U.S. Government, its agencies or
instrumentalities);
(6) issue senior securities, as defined in the 1940 Act, except that this
restriction shall not be deemed to prohibit the Portfolio from (i)
making any permitted borrowings, mortgages or pledges, or (ii)
entering into options, futures or repurchase transactions;
(7) purchase the securities of any issuer, if as a result more than 5% of
the total assets of the Portfolio would be invested in the securities
of that issuer, other than obligations of the U.S. Government, its
agencies or instrumentalities, provided that up to 25% of the value of
the Portfolio's assets may be invested without regard to this
limitation;
(8) purchase or sell real estate; however, the Portfolio may invest in
debt securities secured by real estate or interests therein or issued
by companies which invest in real estate or interests therein,
including real estate investment trusts;
(9) with respect to 75% of its assets, own more than 5% of the securities
of any single issuer (other than investments issued or guaranteed by
the U.S. Government or any of its agencies or instrumentalities); and
(10) with respect to 75% of its assets, own more than 10% of the
outstanding voting securities of any one issuer.
For the purposes of (2) above, the Portfolio may not borrow except
from banks for temporary or emergency purposes and in connection with short
sales of securities. In these situations, the Portfolio will limit borrowings to
no more than 331/3% of the Portfolio's assets, and the Portfolio may not
purchase additional securities when borrowings exceed 5% of its total assets.
Investment restriction (6) above shall not be deemed to prohibit the
Portfolio from engaging in short sales of securities as described in the
Prospectuses under "Additional Investment Policies" and in this SAI under
"Investment Objective and Policies."
As a matter of non-fundamental policy, the Portfolio will not:
7
<PAGE>
(11) purchase any security if as a result the Portfolio would then hold
more than 10% of any class of securities of an issuer (taking all
common stock issues of an issuer as a single class, all preferred
stock issues as a single class, and all debt issues as a single class)
or more than 10% of the outstanding voting securities of an issuer;
(12) invest in any issuer for purposes of exercising control or management;
(13) invest in securities of other investment companies which would result
in the Portfolio owning more than 3% of the outstanding voting
securities of any one such investment company, the Portfolio owning
securities of another investment company having an aggregate value in
excess of 5% of the value of the Portfolio's total assets, or the
Portfolio owning securities of investment companies in the aggregate
which would exceed 10% of the value of the Portfolio's total assets;
and
(14) invest, in the aggregate, more than 15% of its net assets in
securities which are not readily marketable or are illiquid.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectuses is
calculated by dividing the lesser of purchases or sales of portfolio securities
for the year by the monthly average of the value of the portfolio securities.
The calculation excludes all securities, including options, whose maturities at
the time of acquisition were one year or less. Portfolio turnover may vary
greatly from year to year as well as within a particular year, and may also be
affected by cash requirements for redemptions of shares. See "Financial
Highlights" in the Prospectuses for the historical portfolio turnover rates with
respect to the Portfolio.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Portfolio may be purchased without a sales commission at
the net asset value per share next determined after an order is received in
proper form by the Fund and payment is received by the Fund or its designated
Service Agent. The minimum initial investment required for the Portfolio is
$2,500, with certain exceptions as may be permitted from time to time by the
officers of the Fund. Other investment minimums are: initial IRA investment,
$500; initial spousal IRA investment, $250; and additional investment for all
accounts, $100. An order received in proper form prior to the close of regular
trading on the New York Stock Exchange (the "Exchange") (generally 4:00 p.m.
Eastern Time) will be executed at the price computed on the date of receipt; and
an order received not in proper form or after the close of the Exchange will be
executed at the price computed on the next day the Exchange is open after proper
receipt. The Exchange will be closed on the following days: New Year's Day, Dr.
Martin Luther King, Jr.'s Birthday, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
The Portfolio reserves the right in its sole discretion (1) to suspend
the offering of its shares, (2) to reject purchase orders when in the judgment
of management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of a Portfolio's shares.
The Portfolio may suspend redemption privileges or postpone the date
of payment (1) during any period that both the Exchange and custodian bank are
closed or trading on the Exchange is restricted as
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<PAGE>
determined by the SEC, (2) during any period when an emergency exists as defined
by the rules of the SEC as a result of which it is not reasonably practicable
for the Portfolio to dispose of securities owned by it or to fairly determine
the value of its assets, and (3) for such other periods as the SEC may permit.
The Fund has made an election with the SEC to pay in cash all redemptions
requested by any shareholder of record limited in amount during any 90-day
period to the lesser of $250,000 or 1% of the net assets of the Fund at the
beginning of such period. Such commitment is irrevocable without the prior
approval of the SEC. Redemptions in excess of the above limits may be paid, in
whole or in part, in investment securities or in cash as the Directors may deem
advisable; however, payment will be made wholly in cash unless the Directors
believe that economic or market conditions exist which would make such a
practice detrimental to the best interests of the Fund. If redemptions are paid
in investment securities, such securities will be valued as set forth in the
Prospectuses under "VALUATION OF SHARES," and a redeeming shareholder would
normally incur brokerage expenses if these securities were converted to cash.
No charge is made by the Portfolio for redemptions. Any redemption may
be more or less than the shareholder's initial cost depending on the market
value of the securities held by the Portfolio.
SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services
Company ("CGFSC") from fraud, signature guarantees are required for certain
redemptions. The purpose of signature guarantees is to verify the identity of
the person who has authorized a redemption from your account. Signature
guarantees are required for (1) all redemptions when the proceeds are to be paid
to someone other than the registered owner(s) and/or registered address, or (2)
share transfer requests.
Signatures must be guaranteed by an "eligible guarantor institution"
as defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the transfer agent. Broker-dealers guaranteeing signatures
must be a member of a clearing corporation or maintain net capital of at least
$100,000. Credit unions must be authorized to issue signature guarantees.
Signature guarantees will be accepted from any eligible guarantor institution
which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request
for redemption; (2) on a separate instrument for assignment ("stock power")
which should specify the total number of shares to be redeemed; or (3) on all
stock certificates tendered for redemption and, if shares held by the Fund are
also being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market
quotations are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities not traded on the
valuation date for which market quotations are readily available are valued
neither exceeding the current asked prices nor less than the current bid prices.
Quotations of foreign securities in a foreign currency are converted to U.S.
dollar equivalents. The converted value is based upon the bid price of the
foreign currency against U.S. dollars as quoted by any major bank or broker.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Bonds and other fixed income securities may be valued on the
basis of prices provided by a pricing service when such prices are believed to
reflect the fair market value of such securities. Securities purchased with
remaining maturities of 60 days or less are valued at amortized cost, which
approximates market value.
9
<PAGE>
The value of other assets and securities for which no quotations are
readily available (including restricted securities) is determined in good faith
at fair value using methods determined by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectuses.
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for any
other Institutional Class Shares of any other UAM Funds or UAM Funds, Inc.
Portfolio. Similarly, Service Class Shares of the Portfolio may be exchanged for
shares of other UAM Funds or UAM Funds, Inc. Portfolios' Service Class Shares.
Exchange requests should be made by calling the Fund (1-800-638-7983) or by
writing to UAM Funds, UAM Funds Service Center, c/o Chase Global Funds Services
Company, P.O. Box 2798, Boston, MA 02208-2798. The exchange privilege is only
available with respect to Portfolios that are qualified for sale in the
shareholder's state of residence.
Any such exchange will be based on the respective net asset values of
the shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the
shares to be exchanged have not been issued to the shareholder, and if the
registration of the two accounts will be identical. Requests for exchanges
received prior to the close of regular trading of the Exchange (generally 4:00
p.m. Eastern Time) will be processed as of the close of business on the same
day. Requests received after the close of regular trading on the Exchange will
be processed on the next business day. Neither the Fund nor CGFSC will be
responsible for the authenticity of the exchange instructions received by
telephone. Exchanges may also be subject to limitations as to amounts or
frequency and to other restrictions established by the Board of Trustees to
assure that such exchanges do not disadvantage the Fund and its shareholders.
For federal income tax purposes an exchange between Portfolios is a
taxable event, and, accordingly, a capital gain or loss may be realized. In a
revenue ruling relating to circumstances similar to the Fund's, an exchange
between series of a Fund was also deemed to be a taxable event. It is likely,
therefore, that a capital gain or loss would be realized on an exchange between
Portfolios; you may want to consult your tax adviser for further information in
this regard. The exchange privilege may be modified or terminated at any time.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are
responsible to the Fund's Board of Trustees. The Trustees set broad policies for
the Fund and elect its Officers. The following is a list of the Trustees and
Officers of the Fund, their dates of birth, addresses, and a brief statement of
their present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
10
<PAGE>
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated
person, a $150 quarterly retainer fee per active Portfolio which currently
amounts to $1,350 per quarter. In addition, each unaffiliated Trustee receives a
$2,000 meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management
11
<PAGE>
Corporation ("UAM"), or the Administrator and receive no compensation from the
Fund. As of June 15, 1998, the Trustees and officers of the Fund owned less than
1% of the Fund's outstanding shares.
The following table shows aggregate compensation paid to each of the
Fund's Trustees by the Fund and total compensation paid by the Funds and UAM
Funds, Inc. (collectively the "Fund Complex") in the fiscal year ended March 31,
1998.
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Aggregate Benefits Accrued Annual from Registrant
Name of Person, Compensation as Part of Benefits Upon and
Position From Registrant Fund Expenses Retirement Fund Complex
-------- --------------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee............. $6,149 0 0 $33,500
Philip D. English
Trustee............. $6,149 0 0 $33,500
William A. Humenuk
Trustee............. $6,149 0 0 $33,500
Nancy J. Dunn
Trustee............. $4,668 0 0 $25,200
</TABLE>
12
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Peter M. Whitman, Jr.
Trustee $ 0 0 0 $ 0
Norton H. Reamer
Trustee............. $ 0 0 0 $ 0
</TABLE>
13
<PAGE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of
record or beneficially 5% or more of the shares of the Portfolio:
FPA Crescent Portfolio Institutional Class Shares: Charles Schwab &
Co., Inc., Reinvest Account, 101 Montgomery St., San Francisco, CA, 48.8%*.
FPA Crescent Portfolio Institutional Service Class Shares: Wilmington
Trust Co., Trustee, FBO FIGGIE Institutional Investor Retirement & Profit
Sharing Trust SV & PR 401K Plan, AC 421712, c/o Mutual Funds, 1100 N. Market
St., Wilmington, DE, 41.5%*; Wilmington Trust Co., Trustee, FBO Loews Theaters
Salaried Employees Profit Sharing & 401K Plan, c/o Mutual Funds, 1100 N. Market
St., Wilmington, DE, 13.2%*; Wilmington Trust Co., Trustee, FBO FIGGIE
Institutional Investor Retirement & Profit Sharing Trust Supp. Retirement SVS &
Trust 401K Plan, MLF AC 436270, c/o Mutual Funds, 1100 N. Market St.,
Wilmington, DE, 12.5%*; Fleet National Bank, FBO Continental Homes 401K
Retirement Plan, P.O. Box 92800, Rochester, NY, 12.2%*; and Wilmington Trust
Co., Trustee, FBO FIGGIE Institutional Investor Retirement & Profit Sharing
Trust 401K Plan, CLF AC 436260, c/o Mutual Funds, 1100 N. Market St.,
Wilmington, DE, 9.7%*.
The persons or organizations listed above as owning 25% or more of the
outstanding shares of a Portfolio may be presumed to "control" (as that term is
defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
- --------
* Denotes shares held by a trustee or other fiduciary for which
beneficial ownership is disclaimed or presumed disclaimed.
INVESTMENT ADVISER
PHILOSOPHY AND STYLE
Equity Securities: The Adviser utilizes a contrarian investment style,
which often leads to investing in "what other people do not wish to own." The
Adviser searches for common stocks, preferred stocks, warrants and convertible
securities that reflect low price/earnings ratios (P/Es) and trade at discounts
to private market value. The Adviser deems the following to be important in its
stock selection process: high return on capital; solid balance sheet;
meaningful cash flow; active share repurchase program; insider buying; strong
management, seeking to add shareholder value; and projected earnings growth
exceeding the stock market average. In the Adviser's view, the stock market
prices securities efficiently in the long term, rewarding companies which
successfully grow their own earnings and penalizing those which do not. The
investment philosophy is based on the conviction that the market valuation of
securities is often inefficient in the short-term. The Adviser feels that hasty
short-term decisions could cause a particular security, industry group or the
entire market to become underpriced or overpriced in the short- term, thereby
creating an excellent opportunity to either buy or sell.
The Adviser's intensive research process includes looking for ideas by
reviewing stock price or industry group under performance, insider purchasers,
management changes and corporate spin-offs. Fundamental analysis is the
foundation of the Adviser's investment approach.
Fixed Income Obligations: Through fixed income investments, the
Adviser seeks a reliable and recurring stream of income for the Portfolio, while
preserving its capital. The Adviser attempts to identify the current interest
rate trends and invests funds accordingly. Usually, a defensive strategy is
employed, with investments made at
14
<PAGE>
different points along the yield curve in an attempt to keep the average
maturity of fixed income investments less than or equal to ten years.
The Adviser considers yield spread relationships and their underlying
factors such as credit quality, investor perception and liquidity on a
continuous basis to determine which sector offers the best investment value.
When combined with equity securities, the ownership of fixed income securities
not only broadens the universe of opportunities, but offers additional
diversification and can help lower portfolio volatility.
REPRESENTATIVE INSTITUTIONAL CLIENTS
As of the date of this Statement of Additional Information, the
Adviser's representative institutional clients included: General Electric
Investment Corporation; Eastman Kodak Company; Federated Department Stores,
Inc.; Fox Inc.; Xerox Corporation; Southern Farm Bureau Life Insurance Company;
Commonwealth of Pennsylvania Public School Employees Retirement System; and The
Lannan Foundation.
In compiling this client list, the Adviser used objective criteria
such as account size, geographic location and client classification. The
Adviser did not use any performance-based criteria. It is not known whether
these clients approve or disapprove of the Adviser or the advisory services
provided.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the
Fund and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously review, supervise and
administer the Portfolio's investment program, and to determine in its
discretion the securities to be purchased or sold and the portion of the
Portfolio's assets to be held in cash or cash equivalents.
In the absence of (i) willful misfeasance, bad faith or gross
negligence on the part of the Adviser in the performance of its obligations and
duties under the Agreement, (ii) reckless disregard by the Adviser of its
obligations and duties under the Agreement, or (iii) a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services, the Adviser shall not be subject to any liability whatsoever to the
Fund, or to any shareholder of the Fund, for any error of judgment, mistake of
law or any other act or omission in the course of, or connected with, rendering
services under the Agreement.
Unless sooner terminated, the Agreement shall continue for periods of
one year so long as such continuance is specifically approved at least annually
(a) by the vote of a majority of those members of the Board of Trustees of the
Fund who are not parties to the Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval, (b) by the Board of Trustees of the Fund, or (c) by vote of a majority
of the outstanding voting securities of the Portfolio. The Agreement may be
terminated at any time by the Portfolio, without the payment of any penalty, by
vote of a majority of the entire Board of Trustees of the Fund or by vote of a
majority of the outstanding voting securities of the Portfolio on 60 days
written notice to the Adviser. The Agreement may be terminated by the Adviser
at any time, without the payment of any penalty, upon 90 days written notice to
the Fund. The Agreement will automatically and immediately terminate in the
event of its assignment.
CONTROL OF ADVISER
The Adviser is an indirect wholly-owned subsidiary of UAM, a holding
company incorporated in Delaware in December 1980 for the purpose of acquiring
and owning firms engaged primarily in institutional investment management. Since
its first acquisition in August 1983, UAM has acquired or organized over 45 such
wholly-owned affiliated firms (the "UAM Affiliated Firms"). UAM believes that
permitting UAM Affiliated Firms to retain control over their investment advisory
decisions is necessary to allow them to continue to provide investment
management services that are intended to meet the particular needs of their
respective clients.
15
<PAGE>
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue to
operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc., a registered investment company.
ADVISORY FEES
As compensation for services rendered by the Adviser under the Investment
Advisory Agreement, the Portfolio pays the Adviser an annual fee in monthly
installments, calculated by applying the following annual percentage rate to the
Portfolio's average daily net assets for the month: 1.00%.
For the fiscal years ended March 31, 1996, 1997 and 1998, the Portfolio
paid advisory fees of $189,156, $302,772 and $1,489,678, respectively.
SERVICE AND DISTRIBUTION PLANS
As stated in the Portfolio's Service Class Shares Prospectus, the
Distributor may enter into agreements with broker-dealers and other financial
institutions ("Service Agents"), pursuant to which they will provide
administrative support services to Service Class shareholders who are their
customers ("Customers") in consideration of the Fund's payment of 0.25% (on an
annualized basis) of the average daily net asset value of the Service Class
Shares held by the Service Agent for the benefit of its Customers. Such services
include:
(a) acting as the sole shareholder of record and nominee for beneficial
owners;
(b) maintaining account records for such beneficial owners of the Fund's
shares;
(c) opening and closing accounts;
(d) answering questions and handling correspondence from shareholders
about their accounts;
(e) processing shareholder orders to purchase, redeem and exchange shares;
(f) handling the transmission of funds representing the purchase price or
redemption proceeds;
(g) issuing confirmations for transactions in the Fund's shares by
shareholders;
(h) distributing current copies of prospectuses, statements of additional
information and shareholder reports;
(i) assisting customers in completing application forms, selecting
dividend and other account options and opening any necessary custody
accounts;
(j) providing account maintenance and accounting support for all
transactions; and
(k) performing such additional shareholder services as may be agreed upon
by the Fund and the Service Agent, provided that any such additional
shareholder service must constitute a permissible non-banking activity
in accordance with the then current regulations of, and
interpretations thereof by, the Board of Governors of the Federal
Reserve System, if applicable.
Each agreement with a Service Agent is governed by a Shareholder Service
Plan (the "Service Plan") that has been adopted by the Fund's Board of Trustees.
Pursuant to the Service Plan, the Board of Trustees reviews, at least quarterly,
a written report of the amounts expended under each agreement with Service
Agents and the purposes for which the expenditures were made. In addition,
arrangements with Service Agents must be approved
16
<PAGE>
annually by a majority of the Fund's Trustees, including a majority of the
Trustees who are not "interested persons" of the company as defined in the 1940
Act and have no direct or indirect financial interest in such arrangements.
The Board of Trustees has approved the arrangements with Service
Agents based on information provided by the Fund's service contractors that
there is a reasonable likelihood that the arrangements will benefit the Fund and
its shareholders by affording the Fund greater flexibility in connection with
the servicing of the accounts of the beneficial owners of its shares in an
efficient manner. Any material amendment to the Fund's arrangements with Service
Agents must be approved by a majority of the Fund's Board of Trustees (including
a majority of the disinterested Trustees). So long as the arrangements with
Service Agents are in effect, the selection and nomination of the members of the
Fund's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of the Fund will be committed to the discretion of such non-interested
Trustees.
The Service Plan may be terminated at any time by vote of a majority of the
Trustees of the Fund who are not "interested persons" of the Fund and who have
no direct or indirect financial interest in the operation of the Service Plan or
any agreements related to the Service Plan or, at the discretion of the Board of
Trustees of the Fund, by vote of a majority of the outstanding voting securities
of the Fund.
Pursuant to Rule 12b-1 under the 1940 Act, the Fund has adopted a
Distribution Plan for the Service Class Shares of the Fund (the "Distribution
Plan"). The Distribution Plan permits the Fund to pay for certain distribution,
promotional and related expenses involved in the marketing of only the Service
Class Shares.
The Distribution Plan permits the Service Class Shares, pursuant to
the Distribution Agreement, to pay a monthly fee to the Distributor for its
services and expenses in distributing and promoting sales of the Service Class
Shares. These expenses include, among other things, advertising the availability
of services and products; designing materials to send to customers and
developing methods of making such materials accessible to customers; providing
information about the product needs of customers; providing facilities to
solicit Fund sales and to answer questions from prospective and existing
investors about the Fund; receiving and answering correspondence from
prospective investors, including requests for sales literature, prospectuses and
statements of additional information; displaying and making sales literature and
prospectuses available; and acting as liaison between shareholders and the Fund,
including obtaining information from the Fund and providing performance
information about the Fund. In addition, the Service Class Shares may make
payments directly to other unaffiliated parties, who either aid in the
distribution of their shares or provide services to the Class.
The maximum annual aggregate fee payable by the Fund under the Service
and Distribution Plans (the "Plans"), is 0.75% of the Service Class Shares'
average daily net assets for the year. The Fund's Board of Trustees may reduce
this amount at any time. Although the maximum fee payable under the 12b-1 Plan
relating to the Service Class Shares is 0.75% of average daily net assets of
such class, the Board of Trustees has determined that the annual fee, payable on
a monthly basis, under the Plans relating to the Service Class Shares, currently
cannot exceed 0.50% of the average daily net assets represented by the Service
Class. While the current fee which will be payable under the Service Plan and
Distribution Plan has been set at 0.25%, the Plans permit a full 0.75% on all
assets to be paid at any time following appropriate Board approval.
All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid by the Service
Class Shares will be borne by such persons without any reimbursement from such
Classes. Subject to seeking best price and execution, the Fund may, from time to
time, buy or sell portfolio securities from or to firms which receive payments
under the Plans. From time to time, the Distributor may pay additional amounts
from its own resources to dealers for aid in distribution or for aid in
providing administrative services to shareholders.
The Plans, the Distribution Agreement and the form of dealer's and
services agreements have all been approved by the Board of Trustees of the Fund,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund and who have no direct or indirect
financial interest in the Plans or
17
<PAGE>
any related agreements, by vote cast in person at a meeting duly called for the
purpose of voting on the Plan and such Agreements. Continuation of the Plans,
the Distribution Agreement and the related agreements must be approved annually
by the Board of Trustees in the same manner, as specified above.
Each year the Trustees must determine whether continuation of the
Plans is in the best interest of the shareholders of Service Class Shares and
that there is a reasonable likelihood of the Plans providing a benefit to the
Class. The Plans, the Distribution Agreement and the related agreements with any
broker-dealer or others relating to the Class may be terminated at any time
without penalty by a majority of those Trustees who are not "interested persons"
or by a majority vote of the outstanding voting securities of the Class. Any
amendment materially increasing the maximum percentage payable under the Plans
must likewise be approved by a majority vote of the relevant Class' outstanding
voting securities, as well as by a majority vote of those Trustees who are not
"interested persons." Also, any other material amendment to the Plans must be
approved by a majority vote of the Trustees including a majority of the Trustees
of the Fund having no interest in the Plans. In addition, in order for the Plans
to remain effective, the selection and nomination of Trustees who are not
"interested persons" of the Fund must be effected by the Trustees who themselves
are not "interested persons" and who have no direct or indirect financial
interest in the Plans. Persons authorized to make payments under the Plans must
provide written reports at least quarterly to the Board of Trustees for their
review. The National Association of Securities Dealers Regulation, Inc. has
adopted amendments to its Conduct Rules relating to investment company sales
charges. The Fund and the Distributor intend to operate in compliance with these
rules.
During the fiscal year ended March 31, 1998, the Portfolio's Service
Class Shares paid $28,629 for services provided pursuant to the Distribution
Plan.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreement authorizes the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio. In
doing so, a Portfolio may pay higher commission rates than the lowest rate
available when the Adviser believes it is reasonable to do so in light of the
value of the research, statistical, and pricing services provided by the broker
effecting the transaction.
It is not the Fund's practice to allocate brokerage or effect
principal transactions with dealers on the basis of sales of Fund shares which
may be made through broker-dealer firms. However, the Adviser may place
portfolio orders with qualified broker-dealers who recommend the Fund's
Portfolios or who act as agents in the purchase of shares of the Portfolios for
their clients. During the fiscal years ended March 31, 1996, 1997, and 1998,
brokerage commissions paid by the Portfolio totaled $63,938, $50,128 and
$213,179, respectively. The difference in brokerage commissions paid between
fiscal years April 30, 1997 and 1998, was the result of growth in the
portfolio's assets.
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of a Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration
Agreement, effective April 15, 1996 ("Fund Administration Agreement") between
UAMFSI, a wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of
the Fund Administration Agreement,
18
<PAGE>
UAMFSI manages, administers and conducts the general business activities of the
Fund other than those which have been contracted to the third parties by the
Fund. Additionally, UAMFSI has agreed to provide transfer agency services to the
Portfolio pursuant to the terms of the Agreement.
UAMFSI has subcontracted some of these services to CGFSC, an affiliate of
The Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement between
UAMFSI and CGFSC (collectively, with the Fund Administration Agreement, the
"Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a two-
part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a
sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
Annual Rate
-----------
FPA Crescent Portfolio.................0.06%
CGFSC's monthly fee for its services is calculated on an annualized basis
as follows:
0.19% of 1% of the first $200 million of combined Fund net assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion but
less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds Service
Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
The Services provided by UAMFSI and CGFSC and the basis of the current fees
payable are described in the Portfolio's Prospectuses.
During the fiscal year ended March 31, 1996, the Portfolio paid
administrative fees of $78,576 to its prior administrator, Investment Company
Administration Corporation ("ICAC"). During the fiscal year ended March 31,
1997, the Portfolio paid total administrative fees of $14,196 to ICAC, $20,251
to CGFSC, and $30,359 to UAMFSI. During the fiscal year ended March 31, 1998,
the Portfolio paid total administrative fees of $151,953 to CGFSC, and $89,427
to UAMFSI.
UAMFSI will bear all expenses in connection with the performance of its
services under the Fund Administration Agreement. Other expenses to be incurred
in the operation of the Fund will be borne by the Fund or other parties,
including taxes, interest, brokerage fees and commissions, if any, salaries and
fees of officers and members of the Board who are not officers, directors,
shareholders or employees of UAMFSI, or the Fund's investment adviser or
distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
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Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund
Administration Agreement is terminable, without penalty, by the Board or by
UAMFSI, on not less than ninety (90) days' written notice. The Fund
Administration Agreement shall automatically terminate upon its assignment by
UAMFSI without the prior written consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person
or persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended March 31, 1998, the Portfolio paid
$19,064, in fees pursuant to the Services Agreement.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New
York 11245, provides for the custody of the Fund's assets pursuant to the terms
of a custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110,
serves as independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves
as the Fund's Distributor. Shares of the Fund are offered continuously. While
the Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares. The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
March 31, 1998.
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures
to illustrate past performance. Performance quotations by investment companies
are subject to rules adopted by the SEC, which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by the Portfolio be accompanied by certain
standardized performance information computed as required by the SEC. An
explanation of the method used to compute or express performance follows.
TOTAL RETURN
The average annual total return of the Portfolio is determined by
finding the average annual compounded rates of return over 1, 5 and 10 year
periods that would equate an initial hypothetical $1,000 investment to its
ending redeemable value. The calculation assumes that all dividends and
distributions are reinvested when paid. The quotation assumes the amount was
completely redeemed at the end of each 1, 5 and 10 year period and the
20
<PAGE>
deduction of all applicable Portfolio expenses on an annual basis. Since Service
Class Shares of the Portfolio bear additional service and distribution expenses,
the average annual total return of the Service Class Shares of the Portfolio
will generally be lower than that of the Institutional Class Shares.
The average annual total returns for the Portfolio's Institutional
Class Shares for the period from inception on June 2, 1993 to March 31, 1998,
and for the fiscal year ended March 31, 1998 were 18.87% and 25.96%,
respectively. The average annual total returns for the Portfolio's Service Class
Shares for the period from inception on January 24, 1997 to March 31, 1998, and
for the fiscal year ended March 31, 1998 were 23.62% and 25.55%, respectively.
These figures will be calculated according to the following formula:
P(1 + T)/n/ = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1, 5 or 10 year periods at
the end of the 1, 5 or 10 year periods (or fractional
portion thereof).
COMPARISONS
To help investors better evaluate how an investment in the Portfolio
of the Fund might satisfy their investment objective, advertisements regarding
the Portfolio may discuss various measures of Portfolio performance as reported
by various financial publications. Advertisements may also compare performance
(as calculated above) to performance as reported by other investments, indices
and averages. Please see Appendix B for publications, indices and averages which
may be used.
In assessing such comparisons of performance, an investor should keep
in mind that the composition of the investments in the reported indices and
averages is not identical to the composition of investments in the Portfolio,
that the averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name "The Regis Fund II," as a
Delaware business trust on May 18, 1994. On October 31, 1995, the name of the
Fund was changed to "UAM Funds Trust." The Fund's principal executive office is
located at One International Place, 44th Floor, Boston, MA 02110; however, all
investor correspondence should be addressed to the Fund at UAM Funds Service
Center, c/o Chase Global Funds Services Company, P.O. Box 2798, Boston, MA
02208-2798. The Fund's Agreement and Declaration of Trust permits the Fund to
issue an unlimited number of shares of beneficial interest, without par value.
The Trustees have the power to designate one or more series ("Portfolios") of
shares of beneficial interest without further action by shareholders.
The Board of Trustees has classified an additional class of shares in
the Portfolio, known as Advisor Shares. As of the date of this Statement of
Additional Information, no Advisor Shares have been offered by the Portfolio.
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<PAGE>
The shares of the Portfolio, when issued and paid for as provided for
in its Prospectuses, will be fully paid and nonassessable, have no preference as
to conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which means that the holders of more than 50% of the shares voting for the
election of Trustees can elect 100% of the Trustees if they choose to do so. A
shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
each represent an interest in the same assets of a Portfolo and are identical in
all respects except that the Service Class Shares bear certain expenses related
to shareholder servicing and the distribution of such shares, and have exclusive
voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the Shares of
each Portfolio or any class thereof that has been established and designated
shall be entitled to receive, when and as declared by the Trustees, the excess
of the assets belonging to that Portfolio, or in the case of a class, belonging
to that Portfolio and allocable to that class, over the liabilities belonging to
that Portfolio or class. The assets so distributable to the holders of Shares of
any particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of Shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of the
Portfolio's net investment income, if any, together with any net realized
capital gains in the amount and at the times that will avoid both income
(including capital gains) taxes on it and the imposition of the federal excise
tax on undistributed income and capital gains. (See discussion under "Dividends,
Capital Gains Distributions and Taxes" in the Prospectuses.) The amounts of any
income dividends or capital gains distributions cannot be predicted.
Any dividend or distribution paid shortly after the purchase of shares
of the Portfolio by an investor may have the effect of reducing the per share
net asset value of the Portfolio by the per share amount of the dividend or
distribution. Furthermore, such dividends or distributions, although in effect a
return of capital, are subject to income taxes as set forth in the Prospectuses.
As set forth in the Prospectuses, unless the shareholder elects
otherwise in writing, all dividend and capital gains distributions are
automatically reinvested in additional shares of the Portfolio at net asset
value (as of the business day following the record date). This will remain in
effect until the Fund is notified by the shareholder in writing at least three
days prior to the record date that either the Income Option (income dividends in
cash and capital gains distributions in additional shares at net asset value) or
the Cash Option (both income dividends and capital gains distributions in cash)
has been elected. An account statement is sent to shareholders whenever an
income dividend or capital gains distribution is paid.
22
<PAGE>
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain
extent personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's
Annual Report to Shareholders (the "1998 Annual Report") are incorporated by
reference into this Statement of Additional Information. No other parts of the
1998 Annual Report are incorporated by reference herein. The Financial
Statements included in the 1998 Annual Report have been audited by the Fund's
independent accountants, PricewaterhouseCoopers LLP. The report of
PricewaterhouseCoopers LLP is incorporated herein by reference. Such financial
statements have been incorporated herein in reliance upon such report given upon
the authority of PricewaterhouseCoopers LLP as experts in accounting and
auditing. Copies of the 1998 Annual Report may be obtained free of charge by
telephoning the UAM Funds Service Center at the telephone number appearing on
the front page of this Statement of Additional Information.
23
<PAGE>
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
Moody's Investors Service Corporate Bond Ratings:
Aaa -- Bonds which are rated Aaa are judged to be 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.
Moody's Investors Service applies numerical modifiers 1, 2 and 3 in the Aa
and A rating categories. The modifier 1 indicates that the security ranks at a
higher end of the rating category, modifier 2 indicates a mid-range rating and
the modifier 3 indicates that the issue ranks at the lower end of the rating
category.
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 which are 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 which are 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 which are rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to principal
or interest.
Ca -- Bonds which are rated Ca represent obligations which are speculative
in a high degree. Such issues are often in default or have other marked
shortcomings.
C -- Bonds which are rated C are the lowest rated class of bonds, and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
A-1
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Standard & Poor's Corporation Corporate Bond Ratings:
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to 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 -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
BB, B, CCC, CC -- Debt rated BB, B, CCC and CC is regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.
C -- The rating C is reserved for income bonds on which no interest is
being paid.
D -- Debt rated D is in default, and payment of interest and/or repayment
of principal is in arrears.
* Ratings are generally given to securities at the time of issuance. While
the rating agencies may from time to time revise such ratings, they undertake no
obligation to do so.
II. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment
and may not be able to assert a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, Federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the Government National Mortgage
Association are, in effect, backed by the full faith and credit of the United
States through provisions in their charters that they may make "indefinite and
unlimited" drawings on the U.S. Treasury, if needed to service its debt. Debt
from certain other agencies and instrumentalities, including the Federal Home
Loan Bank and Federal National Mortgage Association, is not guaranteed by the
United States, but those institutions are protected by the discretionary
authority of the U.S. Treasury to purchase certain amounts of their securities
to assist the institution in meeting its debt obligations. Finally, other
agencies and instrumentalities, such as the Farm Credit System and the Federal
Home Loan Mortgage Corporation, are federally
A-2
<PAGE>
chartered institutions under Government supervision, but their debt securities
are backed only by the creditworthiness of those institutions, not the U.S.
Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
A-3
<PAGE>
APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an unmanaged
index composed of 30 blue-chip industrial corporation stocks (Dow
Jones Industrial Average), 15 utilities company stocks and 20
transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic stocks
chosen for market size, liquidity, and industry group representation.
It is also a market-value weighted index and was the first benchmark
of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation and
finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents the
return on the market value of all common equity securities for which
daily pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed Income
Fund Performance Analysis -- measure total return and average current
yield for the mutual fund industry. Rank individual mutual fund
performance over specified time periods, assuming reinvestment of all
distributions, exclusive of any applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at maximum
capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions.
(h) Lipper Small Cap Funds Index- a fund that by prospectus or portfolio
practice invests primarily in companies with market capitalizations of
less than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index --
respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges of
countries in Europe, Australia and the Far East, and over 1,400
securities listed on the stock exchanges of these continents,
including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated by
screening for convertible issues of 100 million or greater in market
capitalization. The index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages originated
by private lenders and guaranteed by the mortgage pools of the
Government National Mortgage Association.
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA. It
is a value-weighted, total return index, including approximately 800
issues with maturities of 12 years or greater.
(m) Salomon Brothers Broad Investment Grade Bond Index -- is a market-
weighted index that contains approximately 4,700 individually priced
investment grade corporate bonds rated BBB or better, U.S.
Treasury/agency issues and mortgage pass through securities.
B-1
<PAGE>
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of all
bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of the
Government and Corporate Bond Indices. The Government Index includes
public obligations of the U.S. Treasury, issues of Government
agencies, and corporate debt backed by the U.S. Government. The
Corporate Bond Index includes fixed-rate nonconvertible corporate
debt. Also included are Yankee Bonds and nonconvertible debt issued by
or guaranteed by foreign or international governments and agencies.
All issues are investment grade (BBB) or higher, with maturities of at
least one year and an outstanding par value of at least $100 million
for U.S. Government issues and $25 million for others. Any security
downgraded during the month is held in the index until month-end and
then removed. All returns are market value weighted inclusive of
accrued income.
(p) NASDAQ Industrial Index -- is composed of more than 3,000 industrial
issues. It is a value-weighted index calculated on price change only
and does not include income.
(q) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(r) Russell 2000 Index -- composed of the 2,000 smallest stocks in the
Russell 3000, a market value-weighted index of the 3,000 largest U.S.
publicly-traded companies.
(s) Salomon Brothers 3 Month T-Bill Average - the average return for all
Treasury bills for the previous three month period.
(t) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30% Lehman
Brothers long-term Treasury Bond and 10% U.S. Treasury Bills; 70%
Standard & Poor's 500 Stock Index and 30% NASDAQ Industrial Index; 35%
Standard & Poor's 500 Stock Index and 65% Salomon Brothers High Grade
Bond Index; all stocks on the NASDAQ system exclusive of those traded
on an exchange, and 65% Standard & Poor's 500 Stock Index and 35%
Salomon Brothers High Grade Bond Index.
(u) CDA Mutual Fund Report published by CDA Investment Technologies, Inc.
-- analyzes price, current yield, risk, total return and average rate
of return (average compounded growth rate) over specified time periods
for the mutual fund industry.
(v) Mutual Fund Source Book published by Morningstar, Inc. -- analyzes
price, yield, risk and total return for equity funds.
(w) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest, Financial
Times, Global Investor, Wall Street Journal and Weisenberger
Investment Companies Service -- publications that rate fund
performance over specified time periods.
(x) Consumer Price Index (or Cost of Living Index), published by the U.S.
Bureau of Labor Statistics -- a statistical measure of change over
time in the price of goods and services in major expenditure groups.
(y) Stocks, Bonds, Bills and Inflation, published by Ibbotson Associates -
- historical measure of yield, price and total return for common and
small company stock, long-term government bonds, U.S. Treasury bills
and inflation.
(z) Savings and Loan Historical Interest Rates -- as published by the U.S.
Savings & Loan League Fact Book.
B-2
<PAGE>
(aa) Historical data supplied by the research departments of First Boston
Corporation; the J.P. Morgan companies; Salomon Brothers; Merrill
Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and Bloomberg
L.P.
B-3
<PAGE>
PART B
UAM FUNDS
HANSON EQUITY PORTFOLIO
Institutional Class Shares
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectus of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the Hanson Equity Portfolio (the "Portfolio")
dated July 17, 1998. To obtain the Prospectus, please call the UAM Funds Service
Center at 1-800-638-7983.
<TABLE>
<S> <C>
INVESTMENT OBJECTIVE AND POLICIES......................................... 2
PURCHASE AND REDEMPTION OF SHARES......................................... 3
VALUATION OF SHARES....................................................... 4
SHAREHOLDER SERVICES...................................................... 4
INVESTMENT LIMITATIONS.................................................... 5
MANAGEMENT OF THE FUND.................................................... 6
INVESTMENT ADVISER........................................................ 9
PORTFOLIO TRANSACTIONS.................................................... 10
ADMINISTRATIVE SERVICES................................................... 11
CUSTODIAN................................................................. 12
INDEPENDENT ACCOUNTANTS................................................... 12
DISTRIBUTOR............................................................... 12
PERFORMANCE CALCULATIONS.................................................. 13
GENERAL INFORMATION....................................................... 14
FINANCIAL STATEMENTS...................................................... 15
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS....................... A-1
APPENDIX B COMPARISONS................................................... B-1
</TABLE>
Investment Adviser
Hanson Investment Management Company (Adviser)
Distributor
UAM Fund Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment objective
and policies of the Portfolio as set forth in the Portfolio's Prospectus:
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest bearing short-term investments). The Portfolio will
not loan securities to the extent that greater than one-third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as discussed in the Prospectus.
FOREIGN SECURITIES
Investors in the Portfolio should recognize that investing in foreign
companies through the purchase of American Depositary Receipts ("ADRs") involves
certain special considerations which are not typically associated with investing
in U.S. companies. Since the securities of foreign companies are frequently
denominated in foreign currencies, investments may be affected favorably or
unfavorably by changes in currency rates and in exchange control regulations,
and may incur costs in connection with conversions between various currencies.
As foreign companies are not generally subject to uniform accounting,
auditing and financial reporting standards and they may have policies that are
not comparable to those of domestic companies, there may be less information
available about certain foreign companies than about domestic companies.
Securities of some foreign companies are generally less liquid and more volatile
than securities of comparable domestic companies. There is generally less
government supervision and regulation of stock exchanges, brokers and listed
companies than in the U.S. In addition, with respect to certain foreign
countries, there is the possibility of expropriation or confiscatory taxation,
political or social instability, or diplomatic developments which could affect
U.S. investments in those countries.
Certain foreign governments levy withholding taxes on dividend and interest
income. Although in some countries a portion of these taxes are recoverable, the
non-recoverable portion of foreign withholding taxes will reduce the income
received from the companies comprising the Portfolio's investments. However,
these foreign withholding taxes are not expected to have a significant impact.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectus is calculated by
dividing the lesser of purchases or sales of portfolio securities for the year
by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of
2
<PAGE>
acquisition were one year or less. Portfolio turnover may vary greatly from year
to year as well as within a particular year, and may also be affected by cash
requirements for redemptions of shares. See "Financial Highlights" in the
Prospectus for the historical portfolio turnover rates with respect to the
Portfolio.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Portfolio may be purchased without a sales commission at the
net asset value per share next determined after an order is received in proper
form by the Fund, and payment is received by the Fund or its designated Service
Agent. The minimum initial investment required for the Portfolio is $2,500, with
certain exceptions as may be permitted from time to time by the officers of the
Fund. Other investment minimums are: initial IRA investment, $500; initial
spousal IRA investment, $250; and additional investment for all accounts, $100.
An order received in proper form prior to the close of regular trading on the
New York Stock Exchange (the "Exchange") (generally 4:00 p.m. Eastern Time) will
be executed at the price computed on the date of receipt; and an order received
not in proper form or after the close of the Exchange will be executed at the
price computed on the next day the Exchange is open after proper receipt. The
Exchange will be closed on the following days: New Year's Day, Dr. Martin Luther
King, Jr.'s Birthday, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day.
The Portfolio reserves the right in its sole discretion (1) to suspend the
offering of its shares, (2) to reject purchase orders when in the judgment of
management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of the Portfolio's shares.
The Portfolio may suspend redemption privileges or postpone the date of
payment (1) during any period that either the Exchange or custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for the Portfolio to dispose
of securities owned by it or to fairly determine the value of its assets, and
(3) for such other periods as the SEC may permit. The Fund has made an election
with the SEC to pay in cash all redemptions requested by any shareholder of
record limited in amount during any 90-day period to the lesser of $250,000 or
1% of the net assets of the Fund at the beginning of such period. Such
commitment is irrevocable without the prior approval of the SEC. Redemptions in
excess of the above limits may be paid, in whole or in part, in investment
securities or in cash as the Board of Trustees may deem advisable; however,
payment will be made wholly in cash unless the Board of Trustees believe that
economic or market conditions exist which would make such a practice detrimental
to the best interests of the Fund. If redemptions are paid in investment
securities, such securities will be valued as set forth in the Prospectus under
"VALUATION OF SHARES," and a redeeming shareholder would normally incur
brokerage expenses if those securities were converted to cash.
No charge is made by the Portfolio for redemptions. Any redemption may be
more or less than the shareholder's initial cost depending on the market value
of the securities held by the Portfolio.
SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services Company
("CGFSC") from fraud, signature guarantees are required for certain redemptions.
the purpose of signature guarantees is to verify the identity of the person who
has authorized a redemption from your account. Signature guarantees are
required for (1) all redemptions when the proceeds are to be paid to someone
other than the registered owner(s) and/or registered address, or (2) share
transfer requests.
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<PAGE>
Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the transfer agent. Broker-dealers guaranteeing signatures
must be a member of a clearing corporation or maintain net capital of at least
$100,000. Credit unions must be authorized to issue signature guarantees.
Signature guarantees will be accepted from any eligible guarantor institution
which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request for
redemption; (2) on a separate instrument for assignment ("stock power") which
should specify the total number of shares to be redeemed; or (3) on all stock
certificates tendered for redemption and, if shares held by the Fund are also
being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market
quotations are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed
securities not traded on the valuation date for which market quotations are
readily available are valued neither exceeding the current asked prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is based
upon the bid price of the foreign currency against U.S. dollars as quoted by any
major bank or broker.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Bonds and other fixed income securities may be valued on the
basis of prices provided by a pricing service when such prices are believed to
reflect the fair market value of such securities. Securities purchased with
remaining maturities of 60 days or less are valued at amortized cost using
methods approved by the Board of Trustees.
The value of other assets and securities for which no quotations are
readily available (including restricted securities) is determined in good faith
at fair value using methods determined by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectus.
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for
Institutional Class Shares of any other UAM Funds or UAM Funds, Inc. Portfolio.
Exchange requests should be made by calling the Fund (1-800-638-7983) or by
writing to UAM Funds Trust, UAM Funds Service Center, c/o Chase Global Funds
Services Company, P.O. Box 2798, Boston, MA 02208-2798. The exchange privilege
is only available with respect to Portfolios that are qualified for sale in the
shareholder's state of residence.
Any such exchange will be based on the respective net asset values of the
shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objectives of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
4
<PAGE>
Telephone exchanges will be accepted only if the certificates for the
shares to be exchanged have not been issued to the shareholder, and if the
registration of the two accounts will be identical. Requests for exchanges
received prior to the close of regular trading of the Exchange (generally 4:00
p.m. Eastern Time) will be processed as of the close of business on the same
day. Requests received after the close of regular trading on the Exchange will
be processed on the next business day. Neither the Fund nor CGFSC will be
responsible for the authenticity of the exchange instructions received by
telephone. Exchanges may also be subject to limitations as to amounts or
frequency and to other restrictions established by the Fund's Board of Trustees
to assure that such exchanges do not disadvantage the Fund and its shareholders.
For federal income tax purposes an exchange between Funds is a taxable
event, and, accordingly, a capital gain or loss may be realized. In a revenue
ruling relating to circumstances similar to the Fund's, an exchange between
series of a Fund was also deemed to be a taxable event. It is likely, therefore,
that a capital gain or loss would be realized on an exchange between Portfolios.
You may want to consult your tax adviser for further information in this regard.
The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares of the Portfolio to another person by
making a written request to the Fund. The request should clearly identify the
account and number of shares to be transferred, and include the signature of all
registered owners and all stock certificates, if any, which are subject to the
transfer. The signature on the letter of request, the stock certificate or any
stock power must be guaranteed in the same manner as described under "Redemption
of Shares." As in the case of redemptions, the written request must be received
in good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in the Prospectus of
the Portfolio. A Portfolio's fundamental investment limitations cannot be
changed without the approval of a "majority of the outstanding shares" (as
defined in the 1940 Act) of the Portfolio. Except for the numbered investment
limitations noted as fundamental below, however, the limitations described below
are not fundamental, and may be changed without the consent of shareholders.
Whenever an investment limitation sets forth a percentage limitation on
investment or utilization of assets, such limitation shall be determined
immediately after and as a result of the Portfolio's acquisition of such
security or other asset. Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered when determining whether the investment complies with the Portfolio's
investment limitations.
As a matter of fundamental policy, the Portfolio will not:
(1) invest in physical commodities or contracts on physical commodities;
(2) purchase or sell real estate or real estate limited partnerships,
although it may purchase and sell securities of companies which deal
in real estate and may purchase and sell securities which are
secured by interests in real estate;
(3) make loans except (i) by purchasing debt securities in accordance
with its investment objectives and (ii) by lending its portfolio
securities to banks, brokers, dealers and other
5
<PAGE>
financial institutions so long as such loans are not inconsistent
with the 1940 Act, or the rules and regulations or interpretations
of the SEC thereunder;
(4) underwrite the securities of other issuers; and
(5) issue senior securities, as defined in the 1940 Act, except that
this restriction shall not be deemed to prohibit the Portfolio from
(i) making any permitted borrowings, mortgages or pledges, or (ii)
entering into repurchase transactions.
As a matter of non-fundamental policy, the Portfolio will not:
(1) purchase on margin or sell short;
(2) invest more than an aggregate of 15% of the net assets of the
Portfolio, determined at the time of investment, in securities
subject to legal or contractual restrictions on resale or securities
for which there are no readily available markets; and
(3) invest for the purpose of exercising control over management of any
company.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are
responsible to the Fund's Board of Trustees. The Trustees set broad policies for
the Fund and elect its Officers. The following is a list of the Trustees and
Officers of the Fund, their addresses and dates of birth, and a brief statement
of their present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
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<PAGE>
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund
as that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated
person, a $150 quarterly retainer fee per active Portfolio which currently
amounts to $1,350 per quarter. In addition, each unaffiliated Trustee receives a
$2,000 meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management Corporation ("UAM"), or
the Administrator and receive no compensation from the Fund. As of June 15,
1998, the Trustees and officers of the Fund owned less than 1% of the Fund's
outstanding shares.
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<PAGE>
The following table shows aggregate compensation paid to each of the
Fund's Trustees by the Fund and total compensation paid by the Funds and UAM
Funds, Inc. (collectively the "Fund Complex") in the fiscal year ended April 30,
1998.
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Aggregate Benefits Accrued Annual from Registrant
Name of Person, Compensation From as Part of Benefits Upon and
Position Registrant Fund Expenses Retirement Fund Complex
-------- ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee............. $6,149 0 0 $33,500
Philip D. English
Trustee............. $6,149 0 0 $33,500
William A. Humenuk
Trustee............. $6,149 0 0 $33,500
Nancy J. Dunn
Trustee............. $4,668 0 0 $25,200
Peter M. Whitman, Jr.
Trustee $ 0 0 0 $ 0
Norton H. Reamer
Trustee............. $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of
record or beneficially 5% or more of the shares of the Portfolio:
Hanson Equity Portfolio Institutional Class Shares: Charles Schwab & Co.,
Inc., Reinvest Account, Attn: Mutual Funds, 101 Montgomery St., San Francisco,
CA, 99.8%*.
The person(s) or organization(s) listed above as owning 25% or more of
the outstanding shares of the Portfolio may be presumed to "control" (as that
term is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
- -------
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<PAGE>
* Denotes shares held by a trustee or other fiduciary for which beneficial
ownership is disclaimed or presumed disclaimed.
9
<PAGE>
INVESTMENT ADVISER
CONTROL OF ADVISER
The Adviser is a wholly-owned subsidiary of UAM, a holding company
incorporated in Delaware in December 1980 for the purpose of acquiring and
owning firms engaged primarily in institutional investment management. Since its
first acquisition in August 1983, UAM has acquired or organized over 45 such
wholly-owned affiliated firms (the "UAM Affiliated Firms"). UAM believes that
permitting UAM Affiliated Firms to retain control over their investment advisory
decisions is necessary to allow them to continue to provide investment
management services that are intended to meet the particular needs of their
respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue
to operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc., a registered investment company.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the
Fund and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously review, supervise and
administer the Portfolio's investment program, and to determine in its
discretion the securities to be purchased or sold and the portion of the
Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross
negligence on the part of the Adviser in the performance of its obligations and
duties under the Agreement, (ii) reckless disregard by the Adviser of its
obligations and duties under the Agreement, or (iii) a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services, the Adviser shall not be subject to any liability whatsoever to the
Fund, or to any shareholder of the Fund, for any error of judgment, mistake of
law or any other act or omission in the course of, or connected with, rendering
services under the Agreement.
Unless sooner terminated, the Agreement shall continue for periods of
one year so long as such continuance is specifically approved at least annually
(a) by the vote of a majority of those members of the Board of Trustees of the
Fund who are not parties to the Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval, (b) by the Board of Trustees of the Fund, or (c) by a vote of a
majority of the outstanding voting securities of the Portfolio. The Agreement
may be terminated at any time by the Portfolio, without the payment of any
penalty, by vote of a majority of the entire Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Portfolio on 60
days written notice to the Adviser. The Agreement may be terminated by the
Adviser at any time, without the payment of any penalty, upon 90 days written
notice to the Fund. The Agreement will automatically and immediately terminate
in the event of its assignment.
ADVISORY FEES
As compensation for services rendered by the Adviser under the
Investment Advisory Agreement, the Portfolio pays the Adviser an annual fee in
monthly installments, calculated by applying the following annual percentage
rates to the Portfolio's average daily net assets for the month:
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<PAGE>
Rate
----
Hanson Equity Portfolio................................. 0.70%
For the period from October 3, 1997 (commencement of operations) to April
30, 1998, the Portfolio paid advisory fees of $83,786.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreement authorizes the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio.
The Adviser may, however, consistent with the interests of the Portfolio, select
brokers on the basis of the research, statistical and pricing services they
provide to the Portfolio. Information and research received from such brokers
will be in addition to, and not in lieu of, the services required to be
performed by the Adviser under the Investment Advisory Agreement. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect principal
transactions with dealers on the basis of sales of Fund shares which may be made
through broker-dealer firms. However, the Adviser may place portfolio orders
with qualified broker-dealers who refer clients to the Adviser. For the period
from October 3, 1997 (commencement of operations) to April 30, 1998, the
Portfolio paid aggregate brokerage commissions of $33,367.
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of the Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Board of Trustees.
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<PAGE>
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration Agreement,
effective April 15, 1996 ("Fund Administration Agreement") between UAMFSI, a
wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of the Fund
Administration Agreement, UAMFSI manages, administers and conducts the general
business activities of the Fund other than those which have been contracted to
other third parties by the Fund. Additionally, UAMFSI has agreed to provide
transfer agency services to the Portfolios pursuant to the terms of the Fund
Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC , an affiliate of
the Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement between
UAMFSI and CFFSC (collectively, with the Fund Administration Agreement, the
"Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a two-
part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a
sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
Annual Rate
-----------
Hanson Equity Portfolio............... 0.04%
CGFSC's monthly fee for itsservices is calculated on an annualized basis
as follows:
0.19 of 1% of the first $200 million of combined Fund net assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion but less
than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
Fees are located among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two year. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds
Service Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
For the period from October 3, 1997 (commencement of operations) to
April 30, 1998, administrative services fees paid by the Portfolio totaled
$22,082. Of the fees paid during this period, $17,295 were paid to CGFSC and
$4,787 were paid to UAMFSI.
UAMFSI will bear all expenses in connection with the performance of
its services under the Fund Administration Agreement. Other expenses to be
incurred in the operation of the Fund will be borne by the
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<PAGE>
Fund or other parties, including taxes, interest, brokerage fees and
commissions, if any, salaries and fees of officers and members of the Board who
are not officers, directors, shareholders or employees of UAMFSI, or the Fund's
investment adviser or distributor, SEC fees and state Blue Sky fees, EDGAR
filing fees, processing services and related fees, advisory and administration
fees, charges and expenses of pricing and data services, independent public
accountants and custodians, insurance premiums including fidelity bond premiums,
outside legal expenses, costs of maintenance of corporate existence, typesetting
and printing of prospectuses for regulatory purposes and for distribution to
current shareholders of the Fund, printing and production costs of shareholders'
reports and corporate meetings, cost and expenses of Fund stationery and forms,
costs of special telephone and data lines and devices, trade association dues
and expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund
Administration Agreement is terminable, without penalty, by the Board or by
UAMFSI, on not less than ninety (90) days' written notice. The Fund
Administration Agreement shall automatically terminate upon its assignment by
UAMFSI without the prior written consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person
or persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Portfolio paid no
fees to the Service Provider.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New
York 11245, provides for the custody of the Fund's assets pursuant to the terms
of a custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110,
serves as independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves
as the Fund's Distributor. Shares of the Fund are offered continuously. While
the Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares. The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
April 30, 1998.
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<PAGE>
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures
to illustrate past performance. Performance quotations by investment companies
are subject to rules adopted by the SEC, which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by a Portfolio be accompanied by certain
standardized performance information computed as required by the SEC. Average
annual compounded total return quotations used by a Portfolio are based on the
standardized methods of computing performance mandated by the SEC. An
explanation of the method used to compute or express performance follows.
TOTAL RETURN
The average annual total return of the Portfolio is determined by
finding the average annual compounded rates of return over 1, 5 and 10 year
periods that would equate an initial hypothetical $1,000 investment to its
ending redeemable value. The calculation assumes that all dividends and
distributions are reinvested when paid. The quotation assumes the amount was
completely redeemed at the end of each 1, 5 and 10 year period and the deduction
of all applicable Portfolio expenses on an annual basis.
These figures are calculated according to the following formula:
P(1 + T)/n/ = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the 1, 5 or 10 year periods at the end of
the 1, 5 or 10 year periods (or fractional portion thereof).
The cumulative total return for the Portfolio's Institutional Class
Shares for the period from October 3, 1997 (commencement of operations) to April
30, 1998, was 13.80%. Cumulative total return represents the Portfolio's
performance over a specified period of time. The Portfolio's cumulative total
return is representative of approximately seven months of performance.
COMPARISONS
To help investors better evaluate how an investment in the Portfolio
might satisfy their investment objective, advertisements regarding the Portfolio
may discuss various measures of Portfolio performance as reported by various
financial publications. Advertisements may also compare performance (as
calculated above) to performance as reported by other investments, indices and
averages. Please see Appendix B for publications, indices and averages which may
be used.
In assessing such comparisons of performance, an investor should keep
in mind that the composition of the investments in the reported indices and
averages is not identical to the composition of investments in the Portfolio,
that the averages are generally unmanaged, and that the items included in the
calculations of such averages may not
14
<PAGE>
be identical to the formula used by the Portfolio to calculate its performance.
In addition, there can be no assurance that the Portfolio will continue this
performance as compared to such other averages.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name The Regis Fund II as a Delaware
business trust on May 18, 1994. On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's principal executive office is located
at One International Place, 44th Floor, Boston, MA 02110; however, all investor
correspondence should be addressed to the Fund at UAM Funds Service Center, c/o
Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
Fund's Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest, without par value. The Trustees have
the power to designate one or more series ("Portfolios") or classes of shares of
beneficial interest without further action by shareholders.
The Board of Trustees has classified an two additional classes of
shares in the Portfolio, known as Institutional Service Shares and Advisor
Shares. As of the date of this Statement of Additional Information, no
Institutional Service Shares or Advisor Shares have been offered by the
Portfolio.
The shares of the Portfolio, when issued and paid for as provided for
in its Prospectus, will be fully paid and nonassessable, have no preference as
to conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which means that the holders of more than 50% of the shares voting for the
election of Trustees can elect 100% of the Trustees if they choose to do so. A
shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
each represent an interest in the same assets of a Portfolo and are identical in
all respects except that the Service Class Shares bear certain expenses related
to shareholder servicing and the distribution of such shares, and have exclusive
voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the shares of
each Portfolio or any class thereof that has been established and designated
shall be entitled to receive, when and as declared by the Trustees, the excess
of the assets belonging to that Portfolio, or in the case of a class, belonging
to that Portfolio and allocable to that class, over the liabilities belonging to
that Portfolio or class. The assets so distributable to the holders of shares of
any particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
15
<PAGE>
The Fund's policy is to distribute substantially all of the
Portfolio's net investment income, if any, together with any net realized
capital gains annually in the amount and at the times that will avoid both
income (including capital gains) taxes incurred and the imposition of the
federal excise tax on undistributed income and capital gains. The amounts of any
income dividends or capital gains distributions cannot be predicted. See
discussion under "Dividends, Capital Gains Distributions and Taxes" in the
Prospectus.
Any dividend or distribution paid shortly after the purchase of shares
of the Portfolio by an investor may have the effect of reducing the per share
net asset value of the Portfolio by the per share amount of the dividend or
distribution. Furthermore, such dividends or distributions, although in effect a
return of capital, are subject to income taxes as set forth in the Prospectus.
As set forth in the Prospectus, unless the shareholder elects
otherwise in writing, all dividend and capital gains distributions are
automatically reinvested in additional shares of the respective Portfolio of the
Fund at net asset value (as of the business day following the record date). This
will remain in effect until the Fund is notified by the shareholder in writing
at least three days prior to the record date that either the Income Option
(income dividends in cash and capital gains distributions in additional shares
at net asset value) or the Cash Option (both income dividends and capital gains
distributions in cash) has been elected. An account statement is sent to
shareholders whenever an income dividend or capital gains distribution is paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts, to a certain
extent, personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's
Annual Report to Shareholders (the "1998 Annual Report") are incorporated by
reference into this Statement of Additional Information. No other parts of the
1998 Annual Report are incorporated by reference herein. The Financial
Statements
16
<PAGE>
included in the 1998 Annual Report have been audited by the Fund's independent
accountants, PricewaterhouseCoopers LLP. The reports of PricewaterhouseCoopers
LLP are incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such reports given upon the authority of
PricewaterhouseCoopers LLP as experts in accounting and auditing. Copies of the
1998 Annual Report may be obtained free of charge by telephoning the UAM Funds
Service Center at the telephone number appearing on the front page of this
Statement of Additional Information.
17
<PAGE>
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
Moody's Investors Service Corporate Bond Ratings:
Aaa -- Bonds which are Aaa are judged to be 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.
Moody's applies numerical modifiers 1, 2 and 3 in the Aa and A rating
categories. The modifier 1 indicates that the security ranks at a higher end of
the rating category, modifier 2 indicates a mid-range rating and the modifier 3
indicates that the issue ranks at the lower end of the rating category.
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.
Standard & Poor's Corporation's Corporate Bond Ratings:
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to a small degree.
A -- Bonds rated A have a strong capacity to pay interest and repay
principal although they are
A-1
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somewhat more susceptible to the adverse effects of changes in circumstances and
economic conditions than bonds in higher rated categories.
BBB -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
A-2
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II. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by Federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
and may not be able to assess a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, Federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the GNMA are, in effect, backed
by the full faith and credit of the United States through provisions in their
charters that they may make "indefinite and unlimited" drawings on the U.S.
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and FNMA, is not
guaranteed by the United States, but those institutions are protected by the
discretionary authority of the U.S. Treasury to purchase certain amounts of
their securities to assist the institution in meeting its debt obligations.
Finally, other agencies and instrumentalities, such as the Farm Credit System
and the FHLMC, are federally chartered institutions under Government
supervision, but their debt securities are backed only by the creditworthiness
of those institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
III. DESCRIPTION OF COMMERCIAL PAPER
The Portfolio may invest in commercial paper (including variable amount
master demand notes) rated A-1 or better by S&P or Prime-1 by Moody's or by S&P.
Commercial paper refers to short-term, unsecured promissory notes issued by
corporations to finance short-term credit needs. Commercial paper is usually
sold on a discount basis and has a maturity at the time of issuance not
exceeding nine months. Variable amount master demand notes are demand
obligations that permit the investment of fluctuating amounts at varying market
rates of interest pursuant to arrangement between the issuer and a commercial
bank acting as agent for the payees of such notes whereby both parties have the
right to vary the amount of the outstanding indebtedness on the notes. As
variable amount master demand notes are direct lending arrangements between a
lender and a borrower, it is not generally contemplated that such instruments
will be traded, and there is no secondary market for these notes, although they
are redeemable (and thus immediately repayable by the borrower) at face value,
plus accrued interest, at any time. In connection with the Portfolio's
investment in variable amount master demand notes, the Adviser's investment
management staff will monitor, on an ongoing basis, the earning power, cash flow
and other liquidity ratios of the issuer and the borrower's ability to pay
principal and interest on demand.
Commercial paper rated A-1 by S&P has the following characteristics: (1)
liquidity ratios are adequate to meet cash requirements; (2) long-term senior
debt is rated "A" or better; (3) the issuer has access to at least two
additional channels of borrowing; (4) basic earnings and cash flow have an
upward trend with allowance made for
A-3
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unusual circumstances; (5) typically, the issuer's industry is well established,
and the issuer has a strong position within the industry; and (6) the
reliability and quality of management are unquestioned. Relative strength or
weakness of the above factors determine whether the issuer's commercial paper is
A-1, A-2 or A-3. The rating Prime-1 is the highest commercial paper rating
assigned by Moody's. Among the factors considered by Moody's in assigning
ratings are the following: (1) evaluation of the management of the issuer; (2)
economic evaluation of the issuer's industry or industries and the appraisal of
speculative-type risks which may be inherent in certain areas; (3) evaluation of
the issuer's products in relation to completion and customer acceptance; (4)
liquidity; (5) amount and quality of long term debt; (6) trend of earnings over
a period of ten years; (7) financial strength of a parent company and the
relationships which exist with the issuer; and (8) recognition by the management
of issuer of obligations which may be present or may arise as a result of public
interest questions and preparations to meet such obligations.
IV. DESCRIPTION OF BANK OBLIGATIONS
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Certificates of deposit are negotiable short-term obligations of commercial
banks. Variable rate certificates of deposit are certificates of deposit on
which the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. As a result of these adjustments, the
interest rate on these obligations may increase or decrease periodically.
Frequently, dealers selling variable rate certificates of deposit to the
Portfolio will agree to repurchase such instruments, at the Portfolio's option,
at par on or near the coupon dates. The dealers' obligations to repurchase these
instruments are subject to conditions imposed by various dealers. Such
conditions typically are the continued credit standing of the issuer and the
existence of reasonably orderly market conditions. The Portfolio is also able to
sell variable rate certificates of deposit in the secondary market. Variable
rate certificates of deposit normally carry a higher interest rate than
comparable fixed rate certificates of deposit. A banker's acceptance is a time
draft drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction to finance the import, export, transfer or
storage of goods. The borrower is liable for payment as well as the bank which
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
the secondary markets prior to maturity.
V. DESCRIPTION OF FOREIGN INVESTMENTS
Investors should recognize that investing in foreign companies involves
certain special considerations which are not typically associated with investing
in U.S. companies. Since the securities of foreign companies are frequently
denominated in foreign currencies, a Portfolio may be affected favorably or
unfavorably by changes in currency rates and in exchange control regulations,
and may incur costs in connection with conversions between various currencies.
As foreign companies are not generally subject to uniform accounting,
auditing and financial reporting standards and they may have policies that are
not comparable to those of domestic companies, there may be less information
available about certain foreign companies than about domestic companies.
Securities of some foreign companies are generally less liquid and more volatile
than securities of comparable domestic companies. There is generally less
government supervision and regulation of stock exchanges, brokers and listed
companies than in the U.S. In addition, with respect to certain foreign
countries, there is the possibility of expropriation or confiscatory taxation,
political or social instability, or diplomatic developments which could affect
U.S. investments in those countries.
A-4
<PAGE>
Although the Fund will endeavor to achieve the most favorable execution
costs in its portfolio transactions, fixed commissions on many foreign stock
exchanges are generally higher than negotiated commissions on U.S. exchanges.
Certain foreign governments levy withholding taxes on dividend and interest
income. Although in some countries a portion of these taxes are recoverable, the
non-recoverable portion of foreign withholding taxes will reduce the income
received from the companies comprising the Fund's Portfolios. However, these
foreign withholding taxes are not expected to have a significant impact.
A-5
<PAGE>
APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an unmanaged
index composed of 30 blue-chip industrial corporation stocks (Dow
Jones Industrial Average), 15 utilities company stocks and 20
transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic stocks
chosen for market size, liquidity, and industry group representation.
It is also a market-value weighted index and was the first benchmark
of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation and
finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents the
return on the market value of all common equity securities for which
daily pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed Income
Fund Performance Analysis -- measure total return and average current
yield for the mutual fund industry. Rank individual mutual fund
performance over specified time periods, assuming reinvestment of all
distributions, exclusive of any applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at maximum
capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions.
(h) Lipper Small Cap Funds Index- a fund that by prospectus or portfolio
practice invests primarily in companies with market capitalizations of
less than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index --
respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges of
countries in Europe, Australia and the Far East, and over 1,400
securities listed on the stock exchanges of these continents,
including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated by
screening for convertible issues of 100 million or greater in market
capitalization. The index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages originated
by private lenders and guaranteed by the mortgage pools of the
Government National Mortgage Association.
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA. It
is a value-weighted, total return index, including approximately 800
issues with maturities of 12 years or greater.
B-1
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(m) Salomon Brothers Broad Investment Grade Bond Index -- is a market-
weighted index that contains approximately 4,700 individually priced
investment grade corporate bonds rated BBB or better, U.S.
Treasury/agency issues and mortgage pass through securities.
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of all
bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of the
Government and Corporate Bond Indices. The Government Index includes
public obligations of the U.S. Treasury, issues of Government
agencies, and corporate debt backed by the U.S. Government. The
Corporate Bond Index includes fixed-rate nonconvertible corporate
debt. Also included are Yankee Bonds and nonconvertible debt issued by
or guaranteed by foreign or international governments and agencies.
All issues are investment grade (BBB) or higher, with maturities of at
least one year and an outstanding par value of at least $100 million
for U.S. Government issues and $25 million for others. Any security
downgraded during the month is held in the index until month-end and
then removed. All returns are market value weighted inclusive of
accrued income.
(p) NASDAQ Industrial Index -- is composed of more than 3,000 industrial
issues. It is a value-weighted index calculated on price change only
and does not include income.
(q) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(r) Russell 2000 Index -- composed of the 2,000 smallest stocks in the
Russell 3000, a market value-weighted index of the 3,000 largest U.S.
publicly-traded companies.
(s) Salomon Brothers 3 Month T-Bill Average - the average return for all
Treasury bills for the previous three month period.
(t) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30% Lehman
Brothers Long-Term Treasury Bond and 10% U.S. Treasury Bills; 70%
Standard & Poor's 500 Stock Index and 30% NASDAQ Industrial Index; 35%
Standard & Poor's 500 Stock Index and 65% Salomon Brothers High Grade
Bond Index; all stocks on the NASDAQ system exclusive of those traded
on an exchange, and 65% Standard & Poor's 500 Stock Index and 35%
Salomon Brothers High Grade Bond Index.
(u) CDA Mutual Fund Report published by CDA Investment Technologies, Inc.
-- analyzes price, current yield, risk, total return and average rate
of return (average compounded growth rate) over specified time periods
for the mutual fund industry.
(v) Mutual Fund Source Book published by Morningstar, Inc. -- analyzes
price, yield, risk and total return for equity funds.
(w) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest, Financial
Times, Global Investor, Wall Street Journal and Weisenberger
Investment Companies Service -- publications that rate fund
performance over specified time periods.
B-2
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(x) Consumer Price Index (or Cost of Living Index), published by the U.S.
Bureau of Labor Statistics -- a statistical measure of change over
time in the price of goods and services in major expenditure groups.
(y) Stocks, Bonds, Bills and Inflation, published by Ibbotson Associates -
- historical measure of yield, price and total return for common and
small company stock, long-term government bonds, U.S. Treasury bills
and inflation.
(z) Savings and Loan Historical Interest Rates -- as published by the U.S.
Savings & Loan League Fact Book.
(aa) Historical data supplied by the research departments of First Boston
Corporation; the J.P. Morgan companies; Salomon Brothers; Merrill
Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and Bloomberg
L.P.
B-3
<PAGE>
PART B
UAM FUNDS
JACOBS INTERNATIONAL OCTAGON PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION - July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectus of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the Jacobs International Octagon Portfolio
Institutional Class Shares (the "Portfolio") dated July 17, 1998. To obtain the
Prospectus, please call the UAM Funds Service Center at 1-800-638-7983.
TABLE OF CONTENTS
INVESTMENT OBJECTIVE AND POLICIES.......................................... 2
PURCHASE AND REDEMPTION OF SHARES.......................................... 4
VALUATION OF SHARES........................................................ 5
SHAREHOLDER SERVICES....................................................... 5
INVESTMENT LIMITATIONS..................................................... 6
MANAGEMENT OF THE FUND..................................................... 7
INVESTMENT ADVISER......................................................... 9
PORTFOLIO TRANSACTIONS..................................................... 11
ADMINISTRATIVE SERVICES.................................................... 11
CUSTODIAN.................................................................. 13
INDEPENDENT ACCOUNTANTS.................................................... 13
DISTRIBUTOR................................................................ 13
PERFORMANCE CALCULATIONS................................................... 13
GENERAL INFORMATION........................................................ 15
FINANCIAL STATEMENTS....................................................... 16
APPENDIX A - COMPARISONS................................................... A-1
APPENDIX B DESCRIPTION OF SECURITIES AND RATINGS........................... B-1
Investment Adviser
Jacobs Asset Management (Adviser)
Distributor
UAM Funds Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Funds Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment objective
and policies of the Portfolio as set forth in the Portfolio's Prospectus.
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest bearing short-term investments). The Portfolio will
not loan securities to the extent that greater than one-third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as in the Prospectus.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The U.S. dollar value of the assets of the Portfolio may be affected
favorably or unfavorably by changes in foreign currency exchange rates and
exchange control regulations, and the Portfolio may incur costs in connection
with conversions between various currencies. The Portfolio will conduct its
foreign currency exchange transactions either on a spot (i.e., cash) basis at
the spot rate prevailing in the foreign currency exchange market, or through
entering into forward contracts to purchase or sell foreign currencies. A
forward foreign currency exchange contract involves an obligation to purchase or
sell a specific currency at a future date, which may be any fixed number of days
from the date of the contract agreed upon by the parties, at a price set at the
time of the contract. These contracts are traded in the interbank market
conducted directly between currency traders (usually large commercial banks) and
their customers. A forward contract generally has no deposit requirement, and
no commissions are charged at any stage for such trades.
The Portfolio may enter into forward currency exchange contracts in several
circumstances. When the Portfolio enters into a contract for the purchase or
sale of a security denominated in a foreign currency, or when the Portfolio
anticipates the receipt in a foreign currency of dividends or interest payments
on a security which it holds, the Portfolio may desire to "lock-in" the U.S.
dollar price of the security or the U.S. dollar equivalent of such dividend or
interest payment, as the case may be. By entering into a forward contract for a
fixed amount of dollars for the purchase or sale of the amount of foreign
currency involved in the underlying transactions, the Portfolio will be able to
protect itself against a possible loss resulting from an adverse change in the
relationship between the U.S. dollar and the subject foreign currency during the
period between the date on which the security is purchased or sold, or on which
the dividend or interest payment is declared, and the date on which such
payments are made or received.
Additionally, when the Portfolio anticipates that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, it may enter into a forward contract for a fixed amount of dollars, to
sell the amount of foreign currency approximating the value of some or all of
the Portfolio's securities denominated in such foreign currency. The precise
matching of the forward contract amounts and the value of the securities
involved will not generally be possible since the future value of securities in
foreign currencies will change as a consequence of market movements in the value
of these securities between the date on which the forward contract is entered
into and the date it matures. The projection of short-term currency market
movement is extremely difficult, and the successful execution of a short-term
hedging strategy is highly uncertain. From time to time, the Portfolio
2
<PAGE>
may enter into forward contracts to protect the value of portfolio securities
and enhance Portfolio performance. The Portfolio will not enter into such
forward contracts or maintain a net exposure to such contracts where the
consummation of the contracts would obligate the Portfolio to deliver an amount
of foreign currency in excess of the value of the Portfolio securities or other
assets denominated in that currency.
Under normal circumstances, consideration of the prospect for currency
parities will be incorporated into the long-term investment decisions made with
regard to overall diversification strategies. However, the Adviser believes
that it is important to have the flexibility to enter into such forward
contracts when it determines that the best interests of the performance of the
Portfolio will thereby be served. Except when the Portfolio enters into a
forward contract for the purchase or sale of a security denominated in a foreign
currency, which requires no segregation, a forward contract which obligates the
Portfolio to buy or sell currency will generally require the Fund's Custodian to
hold an amount of that currency or liquid securities denominated in that
currency equal to the Portfolio's obligations, or to segregate liquid assets
equal to the amount of the Portfolio's obligation. If the value of the
segregated assets declines, additional liquid assets will be segregated on a
daily basis so that the value of the segregated assets will be equal to the
amount of the Portfolio's commitments with respect to such contracts.
If the Portfolio retains the portfolio security and engages in an
offsetting transaction, the Portfolio will incur a gain or loss (as described
below) to the extent that there has been movement in forward contract prices.
Should forward prices decline during the period between the Portfolio entering
into a forward contract for the sale of a foreign currency and the date it
enters into an offsetting contract for the purchase of the foreign currency, the
Portfolio will realize a gain to the extent that the price of the currency it
has agreed to sell exceeds the price of the currency it has agreed to purchase.
Should forward prices increase, the Portfolio would suffer a loss to the extent
that the price of the currency it has agreed to purchase exceeds the price of
the currency it has agreed to sell.
The Portfolio's dealings in forward foreign currency exchange contracts
will be limited to the transactions described above. Of course, the Portfolio
is not required to enter into such transactions with regard to their foreign
currency-denominated securities. It also should be realized that this method of
protecting the value of portfolio securities against a decline in the value of a
currency does not eliminate fluctuations in the underlying prices of the
securities. It simply establishes a rate of exchange which one can achieve at
some future point in time. Additionally, although such contracts tend to
minimize the risk of loss due to a decline in the value of the hedged currency,
at the same time, they tend to limit any potential gain which might result
should the value of such currency increase.
RISKS OF FORWARD CONTRACTS
Forward contracts are not traded on contract markets regulated by the CFTC
or by the SEC. To the contrary, such instruments are traded through financial
institutions acting as market-makers. Moreover, a trader of forward contracts
could lose amounts substantially in excess of their initial investments, due to
the margin and collateral requirements associated with such positions.
In addition, forward contracts may be traded on foreign exchanges. Such
transactions are subject to the risk of governmental actions affecting trading
in or the prices of foreign currencies or securities. The value of such
positions also could be adversely affected by (i) other complex foreign
political and economic factors, (ii) lesser availability than in the United
States of data on which to make trading decisions, (iii) delays in a Portfolio's
ability to act upon economic events occurring in foreign markets during
nonbusiness hours in the United States, (iv) the imposition of different
exercise and settlement terms and procedures and margin requirements than in the
United States, and (v) lesser trading volume.
3
<PAGE>
DEPOSITARY RECEIPTS
ADRs are depositary receipts typically used by a U.S. bank or trust company
which evidence ownership of underlying securities issued by a foreign
corporation. EDRs and GDRs are typically issued by foreign banks or trust
companies, although they also may be issued by U.S. banks or trust companies,
and evidence ownership of underlying securities issued by either a foreign or a
United States corporation. Generally, depositary receipts in registered form
are designed for use in the U.S. securities market and depositary receipts in
bearer form are designed for use in securities markets outside the United
States. Depositary receipts may not necessarily be denominated in the same
currency as the underlying securities into which they may be converted.
Depositary receipts may be issued pursuant to sponsored or unsponsored programs.
In sponsored programs, an issuer has made arrangements to have its securities
traded in the form of depositary receipts. In unsponsored programs, the issuer
may not be directly involved in the creation of the program. Although
regulatory requirements with respect to sponsored and unsponsored programs are
generally similar, in some cases it may be easier to obtain financial
information from an issuer that has participated in the creation of a sponsored
program. Accordingly, there may be less information available regarding issuers
of securities underlying unsponsored programs and there may not be a correlation
between such information and the market value of the depositary receipts.
Depositary receipts also involve the risks of other investments in foreign
securities, as discussed in the Prospectus. For purposes of the Portfolio's
investment policies, the Portfolio's investments in depositary receipts will be
deemed to be investments in the underlying securities.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectus is calculated by
dividing the lesser of purchases or sales of portfolio securities for the year
by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of acquisition were one year or less. Portfolio turnover may vary greatly
from year to year as well as within a particular year, and may also be affected
by cash requirements for redemptions of shares. See "Financial Highlights" in
the Prospectus for the historical portfolio turnover rates with respect to the
Portfolio.
PURCHASE AND REDEMPTION OF SHARES
Shares of the Portfolio may be purchased without a sales commission at the
net asset value per share next determined after an order is received in proper
form by the Fund, and payment is received by the Fund or its designated Service
Agent. The minimum initial investment required for the Portfolio is $2,500, with
certain exceptions as may be permitted from time to time by the officers of the
Fund. Other investment minimums are: initial IRA investment, $500; initial
spousal IRA investment, $250; and additional investment for all accounts, $100.
An order received in proper form prior to the close of regular trading on the
New York Stock Exchange ("Exchange") (generally 4:00 p.m. Eastern Time) will be
executed at the price computed on the date of receipt; and an order received not
in proper form or after the close of the Exchange will be executed at the price
computed on the next day the Exchange is open after proper receipt. The exchange
will be closed on the following days: New Year's Day, Dr. Martin Luther King,
Jr. Day,
4
<PAGE>
Presidents' Day; Good Friday; Memorial Day; Independence Day; Labor Day;
Thanksgiving Day and Christmas Day.
The Portfolio reserves the right in its sole discretion (1) to suspend the
offering of its shares, (2) to reject purchase orders when in the judgment of
management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economics can be achieved in sales of the Portfolio's shares.
The Portfolio may suspend redemption privileges or postpone the date of
payment (1) during any period that both the Exchange and custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for the Portfolio to dispose
of securities owned by it or to fairly determine the value of its assets, and
(3) for such other periods as the SEC may permit. The Fund has made an election
with the SEC to pay in cash all redemptions requested by any shareholder of
record limited in amount during any 90-day period to the lesser of $250,000 or
1% of the net assets of the Fund at the beginning of such period. Such
commitment is irrevocable without the prior approval of the SEC. Redemptions in
excess of the above limits may be paid, in whole or in part, in investment
securities or in cash as the Board of Trustees may deem advisable; however,
payment will be made wholly in cash unless the Board of Trustees believes that
economic or market conditions exist which would make such a practice detrimental
to the best interests of the Fund. If redemptions are paid in investment
securities, such securities will be valued as set forth in the Prospectus under
"VALUATION OF SHARES," and a redeeming shareholder would normally incur
brokerage expenses if those securities were converted to cash.
No charge is made by the Portfolio for redemptions. Any redemption may be
more or less than the shareholder's initial cost depending on the market value
of the securities held by the Portfolio.
SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services Company
("CGFSC") from fraud, signature guarantees are required for certain redemptions.
The purpose of signature guarantees is to verify the identity of the person who
has authorized a redemption from your account. Signature guarantees are required
for (1) all redemptions when the proceeds are to be sent to someone other than
the registered owner(s) and/or registered address, or (2) share transfer
requests.
Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the Fund's transfer agent. Broker-dealers guaranteeing
signatures must be a member of a clearing corporation or maintain net capital of
at least $100,000. Credit unions must be authorized to issue signature
guarantees. Signature guarantees will be accepted from any eligible guarantor
institution which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request for
redemption; (2) on a separate instrument for assignment ("stock power") which
should specify the total number of shares to be redeemed; or (3) on all stock
certificates tendered for redemption and, if shares held by the Fund are also
being redeemed, on the letter or stock power.
VALUATION OF SHARES
5
<PAGE>
Equity securities listed on a securities exchange for which market
quotations are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where the
security is primarily traded. Unlisted equity securities and listed securities
not traded on the valuation date for which market quotations are readily
available are valued neither exceeding the current asked prices nor less than
the current bid prices. Quotations of foreign securities in a foreign currency
are converted to U.S. dollar equivalents. The converted value is based upon the
bid price of the foreign currency against U.S. dollars as quoted by any major
bank or broker.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Bonds and other fixed income securities may be valued on the
basis of prices provided by a pricing service when such prices are believed to
reflect the fair market value of such securities.
Securities purchased with remaining maturities of 60 days or less are
valued at amortized cost, using methods approved by the Board of Trustees.
The value of other assets and securities for which no quotations are
readily available (including restricted securities) is determined in good faith
at fair value using methods approved by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectus.
6
<PAGE>
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for
Institutional Class Shares of any UAM Funds or UAM Funds, Inc. Portfolio.
Exchange requests should be made by calling the Fund (1-800-638-7983) or by
writing to UAM Funds, UAM Funds Service Center, c/o Chase Global Funds Services
Company, P.O. Box 2798, Boston, MA 02208-2798. The exchange privilege is only
available with respect to Portfolios that are qualified for sale in the
shareholder's state of residence.
Any such exchange will be based on the respective net asset values of the
shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objective of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the
shares to be exchanged have not been issued to the shareholder, and if the
registration of the two accounts will be identical. Requests for exchanges
received prior to the close of regular trading of the Exchange (generally 4:00
p.m. Eastern Time) will be processed as of the close of business on the same
day. Requests received after the close of regular trading on the Exchange will
be processed on the next business day. Neither the Fund nor the Sub-
Administrator will be responsible for the authenticity of the exchange
instructions received by telephone. Exchanges may also be subject to
limitations as to amounts or frequency, and to other restrictions established by
the Board of Trustees to assure that such exchanges do not disadvantage the Fund
and its shareholders.
For federal income tax purposes an exchange between Funds is a taxable
event, and, accordingly, a capital gain or loss may be realized. In a revenue
ruling relating to circumstances similar to the Fund's, an exchange between
series of a Fund was also deemed to be a taxable event. It is likely,
therefore, that a capital gain or loss would be realized on an exchange between
Portfolios; you may want to consult your tax adviser for further information in
this regard. The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares of the Portfolio to another person by
making a written request to the Fund. The request should clearly identify the
account and number of shares to be transferred, and include the signature of all
registered owners and all stock certificates, if any, which are subject to the
transfer. The signature on the letter of request, the stock certificate or any
stock power must be guaranteed in the same manner as described under "PURCHASE
AND REDEMPTION OF SHARES." As in the case of redemptions, the written request
must be received in good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in the Prospectus
of the Portfolio. A Portfolio's fundamental investment limitations cannot be
changed without the approval of a "majority of the outstanding shares" (as
defined in the 1940 Act) of the Portfolio. Except for the numbered investment
limitations noted as fundamental below, however, the limitations described below
are not fundamental, and may be changed without the consent of shareholders.
Whenever an investment limitation sets forth a percentage limitation on
investment or utilization of assets, such limitation shall be determined
immediately after and as a result of the Portfolio's acquisition of such
security or other asset. Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered when determining whether the investment complies with the Portfolio's
investment limitations.
As a matter of fundamental policy, the Portfolio will not:
(1) invest in physical commodities or contracts on physical
commodities;
7
<PAGE>
(2) purchase or sell real estate limited partnerships, although it may
purchase and sell securities of companies which deal in real estate
and may purchase and sell securities which are secured by interests in
real estate;
(3) make loans except (i) by purchasing debt securities in accordance with
its investment objectives and (ii) by lending its portfolio securities
in banks, brokers, dealers and other financial institutions so long as
such loans are not inconsistent with the 1940 Act or the rules and
regulations or interpretations of the SEC thereunder; and
(4) underwrite the securities of other issuers.
As a matter of non-fundamental policy, the Portfolio will not:
(1) invest in futures and/or options on futures;
(2) purchase on margin or sell short;
(3) invest more than an aggregate of 15% of the net assets of the
Portfolio, determined at the time of investment, in securities subject
to legal or contractual restrictions on resale or securities for which
there are no readily available markets;
(4) invest for the purpose of exercising control over management of any
company; and
(5) issue senior securities, as defined in the 1940 Act, except that this
restriction shall not be deemed to prohibit the Portfolio from (i)
making any permitted borrowings, mortgages or pledges, or (ii)
entering into repurchase transactions.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are
responsible to the Fund's Board of Trustees. The Trustees set broad policies for
the Fund and elect its Officers. The following is a list of the Trustees and
Officers of the Fund, their addresses and dates of birth, and a brief statement
of their present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
8
<PAGE>
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated
person, a $150 quarterly retainer fee per active Portfolio which currently
amounts to $1,350 per quarter. In addition, each unaffiliated Trustee receives a
$2,000 meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management
9
<PAGE>
Corporation ("UAM"), or
the Administrator and receive no compensation from the Fund. As of June 15,
1998, the Trustees and officers of the Fund owned less than 1% of the Fund's
outstanding shares.
10
<PAGE>
The following table shows aggregate compensation paid to each of the Fund's
Trustees by the Fund and total compensation paid by the Funds and UAM Funds,
Inc. (collectively the "Fund Complex") in the fiscal year ended April 30, 1998.
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated
Benefits Accrued Annual Total Compensation
Name of Person, Aggregate Compensation as Part of Benefits Upon from Registrant and
Position From Registrant Fund Expenses Retirement Fund Complex
-------- --------------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee........... $6,149 0 0 $33,500
Philip D. English
Trustee........... $6,149 0 0 $33,500
William A. Humenuk
Trustee........... $6,149 0 0 $33,500
Nancy J. Dunn
Trustee........... $4,668 0 0 $25,200
Peter M. Whitman,
Jr. $ 0 0 0 $ 0
Trustee
Norton H. Reamer
Trustee $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of record
or beneficially 5% or more of the shares of the Portfolio:
Jacobs International Octagon Portfolio Institutional Class Shares:
Michigan State University Foundation, 4700 S. Hagadom Rd., Suite 220, E.
Lansing, MI, 16.2%*; Charles Schwab & Co., Inc., Reinvest Account, Attn: Mutual
Funds, 101 Montgomery St., San Francisco, CA, 12.7%*; and Chembaco, FBO H.H. &
Grace A. Dow Foundation, c/o Chemical Bank & Trust, 333 E. Bank St., Midland,
MI, 7.3%*.
The person(s) or organization(s) listed above as owning 25% or more of the
outstanding shares of the Portfolio may be presumed to "control" (as that term
is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
- -------
11
<PAGE>
* Denotes shares held by a trustee or other fiduciary for which beneficial
ownership is disclaimed or presumed disclaimed.
INVESTMENT ADVISER
CONTROL OF ADVISER
The Adviser is a Florida limited partnership organized in July 1995. UAM
is a limited partner of the Adviser and owns a controlling interest in the
Adviser. UAM is a holding company incorporated in Delaware in December 1980 for
the purpose of acquiring and owning firms engaged primarily in institutional
investment management. Since its first acquisition in August 1983, UAM has
acquired or organized over 45 wholly-owned affiliated firms (the "UAM Affiliated
Firms"). UAM believes that permitting UAM Affiliated Firms to retain control
over their investment advisory decisions is necessary to allow them to continue
to provide investment management services that are intended to meet the
particular needs of their respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue to
operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed
and securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc. a registered investment company.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the Fund
and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously review, supervise and
administer the Portfolio's investment program, and to determine in its
discretion the securities to be purchased or sold and the portion of the
Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross negligence on
the part of the Adviser in the performance of its obligations and duties under
the Agreement, (ii) reckless disregard by the Adviser of its obligations and
duties under the Agreement, or (iii) a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services, the Adviser shall
not be subject to any liability whatsoever to the Fund, or to any shareholder of
the Fund, for any error of judgment, mistake of law or any other act or omission
in the course of, or connected with, rendering services under the
Agreement.
Unless sooner terminated, the Agreement shall continue for periods of one
year so long as such continuance is specifically approved at least annually (a)
by the vote of a majority of those members of the Board of Trustees of the Fund
who are not parties to the Agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting on such approval,
(b) by the Board of Trustees of the Fund, or (c) by vote of a majority of the
outstanding voting securities of the Portfolio. The Agreement may be terminated
at any time by the Portfolio, without the payment of any penalty, by vote of a
majority of the entire Board of Trustees of the Fund or by vote of a majority of
the outstanding voting securities of the Portfolio on 60 days written notice to
the Adviser. The Agreement may be terminated by the Adviser at any time,
without the payment of any penalty, upon 90 days written notice to the Fund.
The Agreement will automatically and immediately terminate in the event of its
assignment.
ADVISORY FEES
As compensation for services rendered by the Adviser under the Investment
Advisory Agreement, the Portfolio pays the Adviser an annual fee in monthly
installments, calculated by applying the following annual percentage rates to
the Portfolio's average daily net assets for the month:
Rate
Jacobs International Octagon Portfolio........1.00%
12
<PAGE>
For the period from January 2, 1997 (commencement of operations) to April
30, 1997, Jacobs International Octagon Portfolio paid advisory fees of $35,743.
During this period, the Adviser voluntarily waived advisory fees of $23,838. For
the fiscal year ended April 30, 1998, Jacobs International Octagon Portfolio
paid advisory fees of $730,085, of which $0 were voluntarily waived. Until
further notice, the Adviser has agreed voluntarily to waive all or a portion of
its advisory fees and to assume operating expenses otherwise payable by the
Portfolio, if necessary, to keep the Portfolio's total annual operating expenses
from exceeding 1.75% of average daily net assets.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreement authorizes the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio.
The Adviser may, however, consistent with the interests of the Portfolio, select
brokers on the basis of the research, statistical and pricing services they
provide to the Portfolio. Information and research received from such brokers
will be in addition to, and not in lieu of, the services required to be
performed by the Adviser under the Investment Advisory Agreement. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect principal
transactions with dealers on the basis of sales of shares which may be made
through broker-dealer firms. However, the Adviser may place portfolio orders
with qualified broker-dealers who refer clients to the Adviser. During the
period from January 2, 1997 (date of commencement) to April 30, 1997, and for
the fiscal year ended April 30, 1998, Jacobs International Octagon Portfolio
paid aggregate brokerage commissions of $74,683 and $344,507, respectively. The
difference in brokerage commissions paid between April 30, 1997 and 1998, was
the result of growth in the portfolio's assets.
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of the Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Board of Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration Agreement
("Fund Administration Agreement"), effective April 15, 1996, between UAMFSI, a
wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of the Fund
Administration Agreement, UAMFSI manages, administers and conducts the general
business activities of the Fund other than those which have been contracted to
other third parties by the Fund. Additionally, UAMFSI has agreed to provide
transfer agency services to the Portfolio pursuant to the terms of the Fund
Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC, an affiliate of
The Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement between
UAMFSI and CGFSC (collectively, with the Fund Administration Agreement, the
"Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a two-
part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a
sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
13
<PAGE>
Annual Rate
-----------
Jacobs International Octagon Portfolio.........0.04%
CGFSC's monthly fee for its services is calculated on an annualized basis
as follows:
0.19 of 1% of the first $200 million of combined Fund net assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion but
less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds Service
Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
For the period January 2, 1997 (date of commencement) to April 30, 1997,
and for the fiscal year ended April 30, 1998, administrative service fees paid
to CGFSC by the Jacobs International Octagon Portfolio totaled $11,212 and
$78,772, respectively. For these same periods, UAMFSI earned $2,339 and
$29,248, respectively, from the Jacobs International Octagon Portfolio as
Administrator. The services provided by UAMFSI and CGFSC and the basis of the
current fees payable are described in the Portfolio's Prospectus.
UAMFSI will bear all expenses in connection with the performance of its
services under the Fund Administration Agreement. Other expenses to be incurred
in the operation of the Fund will be borne by the Fund or other parties,
including taxes, interest, brokerage fees and commissions, if any, salaries and
fees of officers and members of the Board who are not officers, directors,
shareholders or employees of UAMFSI, or the Fund's investment adviser or
distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund
Administration Agreement is terminable, without penalty, by the Board or by
UAMFSI, on not less than ninety (90) days' written notice. The Fund
Administration Agreement shall automatically terminate upon its assignment by
UAMFSI without the prior written consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person
or persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
14
<PAGE>
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Portfolio paid the
Service Provider $1,789 in fees pursuant to the Services Agreement.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New York
11245, provides for the custody of the Fund's assets pursuant to the terms of a
custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110, serves
as independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves as
the Fund's Distributor. Shares of the Fund are offered continuously. While the
Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares. The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
April 30, 1998.
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures to
illustrate past performance. Performance quotations by investment companies are
subject to rules adopted by the SEC, which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by the Portfolio be accompanied by certain
standardized performance information computed as required by the SEC. Average
annual compounded total return quotations used by the Portfolio are based on the
standardized methods of computing performance mandated by the SEC. An
explanation of the method used to compute or express performance follows.
YIELD
Current yield reflects the income per share earned by a Portfolio's
investment. The current yield of a Portfolio is determined by dividing the net
investment income per share earned during a 30-day base period by the maximum
offering price per share on the last day of the period and annualizing the
result. Expenses accrued for the period include any fees charged to all
shareholders during the base period. Since Service Class Shares of a Portfolio
bear additional service and distribution expenses, the yield of the Service
Class Shares of a Portfolio will generally be lower than that of the
Institutional Class Shares of the same Portfolio.
15
<PAGE>
A yield figure is obtained using the following formula:
Yield = 2[(a - b + 1)/6/ - 1]
-----
cd
where:
a = dividends and interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding
during the period that were entitled to receive income
distributions
d = the maximum offering price per share on the last day of the
period.
TOTAL RETURN
The average annual total return of the Portfolio is determined by finding
the average annual compounded rates of return over 1, 5 and 10 year periods that
would equate an initial hypothetical $1,000 investment to its ending redeemable
value. The calculation assumes that all dividends and distributions are
reinvested when paid. The quotation assumes the amount was completely redeemed
at the end of each 1, 5 and 10 year period and the deduction of all applicable
Portfolio expenses on an annual basis.
The average annual total returns for the Portfolio's Institutional Class
Shares from inception on January 2, 1997 to April 30, 1997, and for the fiscal
year ended April 30, 1998 were 15.62% and 19.19%, respectively.
These figures are calculated according to the following formula:
P(1 + T)/n/ = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment made
at the beginning of the 1, 5 or 10 year periods at the end of
the 1, 5 or 10 year periods (or fractional portion thereof).
COMPARISONS
To help investors better evaluate how an investment in the Portfolio might
satisfy their investment objective, advertisements regarding the Portfolio may
discuss various measures of Portfolio performance as reported by various
financial publications. Advertisements may also compare performance (as
calculated above) to performance as reported by other investments, indices and
averages. Please see Appendix A for publications, indices and averages which may
be used.
In assessing such comparisons of performance, an investor should keep in
mind that the composition of the investments in the reported indices and
averages is not identical to the composition of investments in the Portfolio,
that the averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
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GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name "The Regis Fund II" as a Delaware
business trust on May 18, 1994. On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's principal executive office is located
at One International Place, 44th Floor, Boston, MA 02110; however all investor
correspondence should be directed to the Fund at UAM Funds Service Center, c/o
Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
Fund's Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest, without par value. The Trustees have
the power to designate one or more series ("Portfolios") or classes of shares of
beneficial interest without further action by shareholders.
The Board of Trustees has classified an two additional classes of shares in
the Portfolio, known as Institutional Service Shares and Advisor Shares. As of
the date of this Statement of Additional Information, no Institutional Service
Shares or Advisor Shares have been offered by the Portfolio.
The shares of the Portfolio, when issued and paid for as provided for in
its Prospectus, will be fully paid and nonassessable, have no preference as to
conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which means that the holders of more than 50% of the shares voting for the
election of Trustees can elect 100% of the Trustees if they choose to do so. A
shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
each represent an interest in the same assets of a Portfolo and are identical in
all respects except that the Service Class Shares bear certain expenses related
to shareholder servicing and the distribution of such shares, and have exclusive
voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the shares of each
Portfolio or any class thereof that has been established and designated shall be
entitled to receive, when and as declared by the Trustees, the excess of the
assets belonging to that Portfolio, or in the case of a class, belonging to that
Portfolio and allocable to that class, over the liabilities belonging to that
Portfolio or class. The assets so distributable to the holders of shares of any
particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of the Portfolio's net
investment income, if any, together with any net realized capital gains annually
in the amount and at the times that will avoid both income (including capital
gains) taxes incurred and the imposition of the federal excise tax on
undistributed income and capital gains. The amounts of any income dividends or
capital gains distributions cannot be predicted. See discussion under
"DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAXES" in the Prospectus.
Any dividend or distribution paid shortly after the purchase of shares of
the Portfolio by an investor may have the effect of reducing the per share net
asset value of the Portfolio by the per share amount of the dividend or
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distribution. Furthermore, such dividends or distributions, although in effect
a return of capital, are subject to income taxes as set forth in the Prospectus.
As set forth in the Prospectus, unless the shareholder elects otherwise in
writing, all dividend and capital gains distributions are automatically
reinvested in additional shares of the respective Portfolio of the Fund at net
asset value (as of the business day following the record date). This will
remain in effect until the Fund is notified by the shareholder in writing at
least three days prior to the record date that either the Income Option (income
dividends in cash and capital gains distributions in additional shares at net
asset value) or the Cash Option (both income dividends and capital gains
distributions in cash) has been elected. An account statement is sent to
shareholders whenever an income dividend or capital gains distribution is paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain extent
personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's
Annual Report to Shareholders (the "1998 Annual Report") are incorporated by
reference into this Statement of Additional Information. No other parts of the
1998 Annual Report are incorporated by reference herein. The Financial
Statements included in the 1998 Annual Report have been audited by the Fund's
independent accountants, PricewaterhouseCoopers LLP. The reports of
PricewaterhouseCoopers LLP are incorporated herein by reference. Such financial
statements have been incorporated herein in reliance upon such reports given
upon the authority of PricewaterhouseCoopers LLP as experts in accounting and
auditing. Copies of the 1998 Annual Report may be obtained free of charge by
telephoning the UAM Funds Service Center at the telephone number appearing on
the front page of this Statement of Additional Information.
18
<PAGE>
APPENDIX A - COMPARISONS
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<C> <S>
(a) Dow Jones Composite Average or its component averages -- an unmanaged
index composed of 30 blue-chip industrial corporation stocks (Dow
]ones Industrial Average), 15 utilities company stocks and 20
transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index -- consists of 400 domestic stocks
chosen for market size, liquidity, and industry group representation.
It is also a market-value weighted index and was the first benchmark
of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation and
finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents the
return on the market value of all common equity securities for which
daily pricing is available.
(f) Lipper-Mutual Fund Performance Analysis and Lipper-Fixed Income Fund
Performance Analysis -- measure total return and average current
yield for the mutual fund industry. Rank individual mutual fund
performance over specified time periods, assuming reinvestment of all
distributions, exclusive of any applicable sales charges.
(g) Lipper Capital Appreciation Funds Index -- a fund that aims at maximum
capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions.
(h) Lipper Small Cap Funds Index -- a fund that by prospectus or portfolio
practice invests primarily in companies with market capitalizations of
less than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index --
respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges of
countries in Europe, Australia and the Far East, and over 1,400
securities listed on the stock exchanges of these commitments,
including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated by
screening for convertible issues of 100 million or greater in market
capitalization. The index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages originated
by private lenders and guaranteed by the mortgage pools of the
Government National Mortgage Association.
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA. It
is a value-weighted, total return index, including approximately 800
issues with maturities of 12 years or greater.
(m) Salomon Brothers Broad Investment Grade Bond Index -- is a market-
weighted index that contains approximately 4,700 individually priced
investment grade corporate bonds rated BBB or better, U.S.
Treasury/agency issues and mortgage pass through securities.
</TABLE>
A-1
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<TABLE>
<C> <S>
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of all
bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of the
Government and Corporate Bond Indices. The Government Index includes
public obligations of the U.S. Treasury, issues of Government
agencies, and corporate debt backed by the U.S. Government. The
Corporate Bond Index includes fixed-rate nonconvertible corporate
debt. Also included are Yankee Bonds and nonconvertible debt issued
by or guaranteed by foreign or international governments and
agencies. All issues are investment grade (BBB) or higher, with
maturities of at least one year and an outstanding par value of at
least $100 million for U.S. Government issues and $25 million for
others. Any security downgraded during the month is held in the index
until month-end and then removed. All returns are market value
weighted inclusive of accrued income.
(p) NASDAQ Industrial Index -- is composed of more than 3,000 industrial
issues. It is a value-weighted index calculated on price change only
and does not include income.
(q) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(r) Russell 2000 Index -- composed of the 2,000 smallest stocks in the
Russell 3000, a market value-weighted index of the 3,000 largest U.S.
publicly-traded companies.
(s) Salomon Brothers 3 Month T-Bill Average -- the average return for all
Treasury bills for the previous three month period.
(t) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30% Lehman
Brothers Long-Term Treasury Bond and 10% U.S. Treasury Bills; 70%
Standard & Poor's 500 Stock Index and 30% NASDAQ Industrial Index; 35%
Standard & Poor's 500 Stock Index and 65% Salomon Brothers High Grade
Bond Index; all stocks on the NASDAQ system exclusive of those traded
on an exchange, and 65% Standard & Poor's 500 Stock Index and 35%
Salomon Brothers High Grade Bond Index.
(u) CDA Mutual Fund Report published by CDA Investment Technologies, Inc.
-- analyzes price, current yield, risk, total return and average rate
of return (average compounded growth rate) over specified time periods
for the mutual fund industry.
(v) Mutual Fund Source Book published by Morningstar, Inc. - analyzes
price, yield, risk and total return for equity funds.
(w) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest, Financial
Times, Global Investor, Wall Street Journal and Weisenberger
Investment Companies Service -- publications that rate fund
performance over specified time periods.
(x) Consumer Price Index (or Cost of Living Index), published by the U.S.
Bureau of Labor Statistics -- a statistical measure of change over
time in the price of goods and services in major expenditure groups.
(y) Stocks, Bonds, Bills and Inflation, published by lbbotson Associates -
- historical measure of yield, price and total return for common and
small company stock, long-term government bonds, U.S. Treasury bills
and inflation.
(z) Savings and Loan Historical Interest Rates -- as published by the U.S.
Savings & Loan League Fact Book.
</TABLE>
A-2
<PAGE>
(aa) Historical data supplied by the research departments of First Boston
Corporation; the J.P. Morgan companies; Salomon Brothers; Merrill
Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and Bloomberg
L.P.
A-3
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APPENDIX B - DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF COMMERCIAL PAPER RATINGS
Moody's Investors Service Commercial Paper Ratings:
Prime-1 - Issuers (or supporting institutions) have a superior ability for
repayment of senior short-term debt obligations. Prime-1 repayment ability will
often be evidenced by many of the following characteristics: leading market
positions in well-established industries; high rates of return on funds
employed; conservative capitalization structure with moderate reliance on debt
and ample asset protection; broad margins in earnings coverage of fixed
financial charges and high internal cash generation; and well-established access
to a range of financial markets and assured sources of alternate liquidity.
Prime-2 - Issuers (or supporting institutions) have a strong ability for
repayment of senior short-term debt obligations. This will normally be
evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, may be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.
Standard & Poor's Ratings Services Commercial Paper Ratings:
A-1 - Obligations are rated in the highest category indicating that the
obligor's capacity to meet its financial commitment is strong. Within this
category, certain obligations are designated with a plus sign (+). This
indicates that the obligor's capacity to meet its financial commitment on these
obligations is extremely strong.
A-2 - Obligations are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations rated "A-1".
However, the obligor's capacity to meet its financial commitment on the
obligation is satisfactory.
B-1
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PART B
UAM FUNDS
MJI INTERNATIONAL EQUITY PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectuses of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the MJI International Equity Portfolio (the
"Portfolio") dated July 17 , 1998 relating to the Institutional Class Shares and
the Institutional Service Class Shares (the "Service Class Shares"). To obtain a
Prospectus, please call UAM Funds Service Center at 1-800-638-7983.
TABLE OF CONTENTS
INVESTMENT OBJECTIVE AND POLICIES........................................ 2
PURCHASE AND REDEMPTION OF SHARES........................................ 9
VALUATION OF SHARES...................................................... 10
SHAREHOLDER SERVICES..................................................... 10
INVESTMENT LIMITATIONS................................................... 11
MANAGEMENT OF THE FUND................................................... 12
INVESTMENT ADVISER....................................................... 14
SERVICE AND DISTRIBUTION PLANS........................................... 16
PORTFOLIO TRANSACTIONS................................................... 18
ADMINISTRATIVE SERVICES.................................................. 18
CUSTODIAN................................................................ 20
INDEPENDENT ACCOUNTANTS.................................................. 20
DISTRIBUTOR.............................................................. 20
PERFORMANCE CALCULATIONS................................................. 20
GENERAL INFORMATION...................................................... 21
FINANCIAL STATEMENTS..................................................... 22
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS...................... A-1
APPENDIX B - COMPARISONS................................................. B-1
Investment Adviser
Murray Johnstone International Ltd. (Adviser)
Distributor
UAM Fund Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment objective
and policies of the Portfolio as set forth in the Portfolio's Prospectuses for
the Institutional Class Shares and Service Class Shares.
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
not less than 100% of the value of the securities loaned, (b) the borrower add
to such collateral whenever the price of the securities loaned rises (i.e., the
borrower "marks to the market" on a daily basis), (c) the loan be made subject
to termination by the Portfolio at any time, and (d) the Portfolio receives
reasonable interest on the loan (which may include the Portfolio investing any
cash collateral in interest bearing short-term investments). The Portfolio will
not loan securities to the extent that greater than one-third of its assets
(including the value of the collateral for the loans) at fair market value would
be committed to loans. As with other extensions of credit, there are risks of
delay in recovery or even loss of rights in the securities loaned if the
borrower of the securities fails financially. These risks are similar to the
ones involved with repurchase agreements as discussed in the Prospectuses.
HEDGING STRATEGIES
The Portfolio may engage in various portfolio strategies to hedge against
adverse movements in the equity, debt and currency markets. The Portfolio may
buy or sell futures contracts, write (i.e., sell) covered call options on its
portfolio securities, purchase put and call options on securities and engage in
transactions in stock index options and stock index futures, and related options
on such futures. The Portfolio may also enter into forward foreign currency
exchange contracts to hedge against its foreign currency movements. These
portfolio strategies are commonly referred to as derivative investments. Each of
these portfolio strategies is described below. Although certain risks are
involved in options and futures transactions, the Adviser believes that, because
the Portfolio will engage in options and futures transactions only for hedging
purposes, the options and futures portfolio strategies of the Portfolio will not
subject it to the risks frequently associated with the speculative use of
options and futures transactions. While the Portfolio's use of hedging
strategies is intended to reduce the volatility of the net asset value of the
Portfolio shares, the Portfolio's net asset value will fluctuate. There can be
no assurance that the Portfolio's hedging transactions will be effective. Also,
the Portfolio may not necessarily be engaging in hedging activities when
movements in any particular equity, debt or currency market occur.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The U.S. dollar value of the assets of the Portfolio may be affected
favorably or unfavorably by changes in foreign currency exchange rates and
exchange control regulations, and the Portfolio may incur costs in connection
with conversions between various currencies. The Portfolio will conduct its
foreign currency exchange transactions either on a spot (i.e., cash) basis at
the spot rate prevailing in the foreign currency exchange market, or through
entering into forward contracts to purchase or sell foreign currencies. A
forward foreign currency exchange contract involves an obligation to purchase or
sell a specific currency at a future date, which may be any fixed number of days
from the date of the contract agreed upon by the parties, at a price set at the
time of the contract. These contracts are traded in the interbank market and are
conducted directly between currency traders (usually large commercial banks) and
their customers. A forward contract generally has no deposit requirement, and no
commissions are charged at any stage for such trades.
The Portfolio may enter into forward foreign currency exchange contracts in
several circumstances. When the Portfolio enters into a contract for the
purchase or sale of a security denominated in a foreign currency, or when
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<PAGE>
the Portfolio anticipates the receipt in a foreign currency of dividends or
interest payments on a security which it holds, the Portfolio may desire to
"lock-in" the U.S. dollar price of the security or the U.S. dollar equivalent of
such dividend or interest payment, as the case may be. By entering into a
forward contract for a fixed amount of dollars, for the purchase or sale of the
amount of foreign currency involved in the underlying transactions, the
Portfolio will be able to protect itself against a possible loss resulting from
an adverse change in the relationship between the U.S. dollar and the subject
foreign currency during the period between the date on which the security is
purchased or sold, or on which the dividend or interest payment is declared, and
the date on which such payments are made or received.
Additionally, when the Portfolio anticipates that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, it may enter into a forward contract for a fixed amount of dollars to
sell the amount of foreign currency approximating the value of some or all of
the Portfolio's securities denominated in such foreign currency. The precise
matching of the forward contract amounts and the value of the securities
involved generally will not be possible since the future value of securities in
foreign currencies will change as a consequence of market movements in the value
of these securities between the date on which the forward contract is entered
into and the date it matures. The projection of short-term currency market
movement is extremely difficult and the successful execution of a short-term
hedging strategy is highly uncertain. The Portfolio does not intend to enter
into such forward contracts to protect the value of portfolio securities on a
regular or continuous basis. The Portfolio will not enter into such forward
contracts or maintain a net exposure to such contracts where the consummation of
the contracts would obligate the Portfolio to deliver an amount of foreign
currency in excess of the value of the Portfolio's securities or other assets
denominated in that currency.
Under normal circumstances, consideration of the prospect for currency
parities will be incorporated into the long-term investment decisions made with
regard to overall diversification strategies. However, the management of the
Fund believes that it is important to have the flexibility to enter into such
forward contracts when it determines that the best interests of the performance
of the Portfolio will thereby be served. The Fund's Custodian will place cash or
liquid securities into a segregated account in an amount equal to the value of
the Portfolio's total assets committed to the consummation of forward foreign
currency exchange contracts. If the value of the securities placed in the
segregated account declines, additional cash or securities will be placed in the
account on a daily basis so that the value of the account will be equal to the
amount of the Portfolio's commitments with respect to such contracts.
The Portfolio generally will not enter into a forward contract with a term
of greater than one year. At the maturity of a forward contract, the Portfolio
may either sell the portfolio security and make delivery of the foreign
currency, or it may retain the security and terminate its contractual obligation
to deliver the foreign currency by purchasing an "offsetting" contract with the
same currency trader obligating it to purchase, on the same maturity date, the
same amount of the foreign currency.
It is impossible to forecast with absolute precision the market value of a
particular portfolio security at the expiration of the contract. Accordingly, it
may be necessary for the Portfolio to purchase additional foreign currency on
the spot market (and bear the expense of such purchase) if the market value of
the security is less than the amount of foreign currency that the Portfolio is
obligated to deliver and if a decision is made to sell the security and make
delivery of the foreign currency.
If the Portfolio retains the portfolio security and engages in an
offsetting transaction, the Portfolio will incur a gain or loss (as described
below) to the extent that there has been movement in forward contract prices.
Should forward prices decline during the period between the Portfolio entering
into a forward contract for the sale of a foreign currency and the date it
enters into an offsetting contract for the purchase of the foreign currency, the
Portfolio will realize a gain to the extent that the price of the currency it
has agreed to sell exceeds the price of the currency it has agreed to purchase.
Should forward prices increase, the Portfolio would suffer a loss to the extent
that the price of the currency it has agreed to purchase exceeds the price of
the currency it has agreed to sell.
The Portfolio's dealings in forward foreign currency exchange contracts
will be limited to the transactions described above. Of course, the Portfolio is
not required to enter into such transactions with regard to their foreign
currency-denominated securities. It also should be realized that this method of
protecting the value of portfolio
3
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securities against a decline in the value of a currency does not eliminate
fluctuations in the underlying prices of the securities. It simply establishes a
rate of exchange which one can achieve at some future point in time.
Additionally, although such contracts tend to minimize the risk of loss due to a
decline in the value of the hedged currency, at the same time, they tend to
limit any potential gain which might result should the value of such currency
increase.
FUTURES CONTRACTS
The Portfolio may enter into futures contracts for the purposes of hedging,
remaining fully invested and reducing transactions costs. Futures contracts
provide for the future sale by one party and purchase by another party of a
specified amount of a specific security at a specified future time and at a
specified price. Futures contracts which are standardized as to maturity date
and underlying financial instrument are traded on national futures exchanges.
Futures exchanges and trading are regulated under the Commodity Exchange Act by
the Commodity Futures Trading Commission ("CFTC"), a U.S. Government agency.
Although futures contracts by their terms call for actual delivery or
acceptance of the underlying securities, in most cases the contracts are closed
out before the settlement date without the making or taking of delivery. Closing
out an open futures position is done by taking an opposite position ("buying" a
contract which has previously been "sold" or "selling" a contract previously
"purchased") in an identical contract to terminate the position. Brokerage
commissions are incurred when a futures contract is bought or sold.
Futures contracts on securities indices or other indices do not require the
physical delivery of securities, but merely provide for profits and losses
resulting from changes in the market value of a contract to be credited or
debited at the close of each trading day to the respective accounts of the
parties to the contract. On the contract's expiration date a final cash
settlement occurs and the futures position is simply closed out. Changes in the
market value of a particular futures contract reflect changes in the level of
the index on which the futures contract is based.
Futures traders are required to make a good faith margin deposit in cash or
acceptable securities with a broker or custodian to initiate and maintain open
positions in futures contracts. A margin deposit is intended to assure
completion of the contract (delivery or acceptance of the underlying security)
if it is not terminated prior to the specified delivery date. Minimal initial
margin requirements are established by the futures exchange and may be changed.
Brokers may establish deposit requirements which are higher than the exchange
minimums. Generally, margin deposits are structured as percentages (e.g., 5%) of
the market value of the contracts being traded. After a futures contract
position is opened, the value of the contract is marked to market daily. If the
futures contract price changes to the extent that the margin on deposit does not
satisfy margin requirements, payment of additional "variation" margin will be
required. Conversely, changes in the contract value may reduce the required
margin, resulting in a repayment of excess margin to the contract holder.
Variation margin payments are made to and from the futures broker for as long as
the contract remains open. The Portfolio expects to earn interest income on its
margin deposits.
Traders in futures contracts may be broadly classified as either "hedgers"
or "speculators." Hedgers use the futures markets primarily to offset
unfavorable changes in the value of securities otherwise held for investment
purposes or expected to be acquired by them. Speculators are less inclined to
own the securities underlying the futures contracts which they trade and use
futures contracts with the expectation of realizing profits from a fluctuation
in interest rates. The Portfolio intends to use futures contracts only for
hedging purposes.
Regulations of the CFTC applicable to the Fund require that all of its
futures transactions constitute bona fide hedging transactions or that the
Fund's commodity futures and option positions be for other purposes, to the
extent that the aggregate initial margins and premiums required to establish
such non-hedging positions do not exceed five percent of the liquidation value
of the Portfolio. The Portfolio will only sell futures contracts to protect
securities it owns against price declines or purchase contracts to protect
against an increase in the price of securities it intends to purchase. As
evidence of this hedging interest, the Portfolio expects that approximately 75%
of its futures contracts purchases will be "completed," that is, equivalent
amounts of related securities will have been purchased or will be purchased by
the Portfolio on the settlement date of the futures contracts.
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Although techniques other than the sale and purchase of futures contracts
could be used to control the Portfolio's exposure to market fluctuations, the
use of futures contracts may be a more effective means of hedging this exposure.
While the Portfolio will incur commission expenses in both opening and closing
out futures positions, these costs are lower than transaction costs incurred in
the purchase and sale of the underlying securities.
RESTRICTIONS ON THE USE OF FUTURES CONTRACTS
The Portfolio will not enter into futures contract transactions to the
extent that, immediately thereafter, the sum of its initial margin deposits on
open contracts exceeds 5% of the market value of its total assets. In addition,
the Portfolio will not enter into futures contracts to the extent that its
outstanding obligations to purchase securities under these contracts would
exceed 20% of its total assets.
RISK FACTORS IN FUTURES TRANSACTIONS
The Portfolio will minimize the risk that it will be unable to close out a
futures position by only entering into futures which are traded on national
futures exchanges and for which there appears to be a liquid secondary market.
However, there can be no assurance that a liquid secondary market will exist for
any particular futures contract at any specific time. Thus, it may not be
possible to close a futures position. In the event of adverse price movements,
the Portfolio would continue to be required to make daily cash payments to
maintain its required margin. In such situations, if the Portfolio has
insufficient cash, it may have to sell portfolio securities to meet daily margin
requirements at a time when it may be disadvantageous to do so. In addition, the
Portfolio may be required to make delivery of the instruments underlying futures
contracts it holds. The inability to close futures positions also could have an
adverse impact on the Portfolio's ability to effectively hedge.
The risk of loss in trading futures contracts in some strategies can be
substantial due both to the low margin deposits required and the extremely high
degree of leverage involved in futures pricing. As a result, a relatively small
price movement in a futures contract may result in immediate and substantial
loss (as well as gain) to the investor. For example, if at the time of purchase,
10% of the value of the futures contract is deposited as margin, a subsequent
10% decrease in the value of the futures contract would result in a total loss
of the margin deposit, before any deduction for the transaction costs, if the
account were then closed out. A 15% decrease would result in a loss equal to
150% of the original margin deposit if the contract were closed out. Thus, a
purchase or sale of a futures contract may result in losses in excess of the
amount invested in the contract. However, because the futures strategies of the
Portfolio are engaged in only for hedging purposes, the Adviser does not believe
that the Portfolio is subject to the risks of loss frequently associated with
futures transactions. The Portfolio would presumably have sustained comparable
losses if, instead of the futures contract, it had invested in the underlying
financial instrument and sold it after the decline.
Utilization of futures transactions by the Portfolio does involve the risk
of imperfect or no correlation where the securities underlying the futures
contracts have different maturities than the portfolio securities being hedged.
It is also possible that the Portfolio could lose money on futures contracts and
also experience a decline in value of portfolio securities. There is also the
risk of loss by the Portfolio of margin deposits in the event of bankruptcy of a
broker with whom the Portfolio has an open position in a futures contract or
related option.
Most futures exchanges limit the amount of fluctuation permitted in futures
contract prices during a single trading day. The daily limit establishes the
maximum amount that the price of a futures contract may vary either up or down
from the previous day's settlement price at the end of a trading session. Once
the daily limit has been reached in a particular type of contract, no trades may
be made on that day at a price beyond that limit. The daily limit governs only
price movement during a particular trading day and, therefore, does not limit
potential losses because the limit may prevent the liquidation of unfavorable
positions. Futures contract prices have occasionally moved to the daily limit
for several consecutive trading days, with little or no trading, thereby
preventing prompt liquidation of futures positions and subjecting some futures
traders to substantial losses.
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OPTIONS
The Portfolio may purchase and sell put and call options on securities and
futures contracts for hedging purposes. Investments in options involve some of
the same considerations that are involved in connection with investments in
futures contracts (e.g., the existence of a liquid secondary market). In
addition, the purchase of an option also entails the risk that changes in the
value of the underlying security or contract will not be fully reflected in the
value of the option purchased. Depending on the pricing of the option compared
to either the futures contract on which it is based or the price of the
securities being hedged, an option may or may not be less risky than ownership
of the futures contract or such securities. For example, there are significant
differences between the securities, futures and options markets that could
result in an imperfect correlation between these markets, causing a given
transaction not to achieve its objective. A decision as to whether, when, and
how to use options involves the exercise of skill and judgment by the Adviser,
and even a well-conceived transaction may be unsuccessful because of market
behavior or unexpected events.
WRITING COVERED CALL OPTIONS
The principal reason for writing call options is to attempt to realize,
through the receipt of premiums, a greater return than would be realized on
securities alone. By writing covered call options, the Portfolio gives up the
opportunity, while the option is in effect, to profit from any price increase in
the underlying security above the option exercise price. In addition, the
Portfolio's ability to sell the underlying security will be limited while the
option is in effect unless the Portfolio effects a closing purchase transaction.
A closing purchase transaction cancels out the Portfolio's position as the
writer of an option by means of an offsetting purchase of an identical option
prior to the expiration of the option it has written. Covered call options serve
as a partial hedge against the price of the underlying security declining. The
Portfolio writes only covered options, which means that so long as the Portfolio
is obligated as the writer of the option it will, in a segregated account with
its custodian, maintain cash or liquid securities denominated in U.S. dollars
with a value equal to or greater than the exercise price of the underlying
securities.
PURCHASING OPTIONS
The amount of any appreciation in the value of the underlying security
subject to a put will be partially offset by the amount of the premium paid for
the put option and any related transaction costs. Prior to its expiration, a put
option may be sold in a closing sale transaction and profit or loss from a sale
will depend on whether the amount received is more or less than the premium paid
for the put option plus the related transaction costs. A closing sale
transaction cancels out the Portfolio's position as purchaser of an option by
means of an offsetting sale of an identical option prior to the expiration of
the option it has purchased. In certain circumstances, the Portfolio may
purchase call options on securities held in its investment portfolio on which it
has written call options or on securities which it intends to purchase.
OPTIONS ON FOREIGN CURRENCIES
The Portfolio may purchase and write options on foreign currencies for
hedging purposes in a manner similar to that in which futures contracts on
foreign currencies, or forward contracts, will be utilized. For example, a
decline in the dollar value of a foreign currency in which portfolio securities
are denominated will reduce the dollar value of such securities, even if their
value in the foreign currency remains constant. In order to protect against such
diminutions in the value of portfolio securities, the Portfolio may purchase put
options on the foreign currency. If the value of the currency does decline, the
Portfolio will have the right to sell such currency for a fixed amount in
dollars and will thereby offset, in whole or in part, the adverse effect on its
portfolio which otherwise would have resulted.
Conversely, where a rise in the dollar value of a currency in which
securities to be acquired are denominated is projected, thereby increasing the
cost of such securities, the Portfolio may purchase call options thereon. The
purchase of such options could offset, at least partially, the effects of the
adverse movements in exchange rates. As in the case of other types of options,
however, the benefit to the Portfolio deriving from
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purchases of foreign currency options will be reduced by the amount of the
premium and related transaction costs. In addition, where currency exchange
rates do not move in the direction or to the extent anticipated, the Portfolio
could sustain losses on transactions in foreign currency options which would
require it to forego a portion or all of the benefits of advantageous changes in
such rates.
The Portfolio may write options on foreign currencies for the same types of
hedging purposes. For example, where the Portfolio anticipates a decline in the
dollar value of foreign currency denominated securities due to adverse
fluctuations in exchange rates it could, instead of purchasing a put option,
write a call option on the relevant currency. If the anticipated decline occurs,
the option will most likely not be exercised, and the diminution in value of
portfolio securities will be offset by the amount of the premium received.
Similarly, instead of purchasing a call option to hedge against an
anticipated increase in the dollar cost of securities to be acquired, the
Portfolio could write a put option on the relevant currency which, if rates move
in the manner projected, will expire unexercised and allow the Portfolio to
hedge such increased cost up to the amount of the premium. As in the case of
other types of options, however, the writing of a foreign currency option will
constitute only a partial hedge up to the amount of the premium, and only if
rates move in the expected direction. If this does not occur, the option may be
exercised and the Portfolio would be required to purchase or sell the underlying
currency at a loss which may not be offset by the amount of the premium. Through
the writing of options on foreign currencies, the Portfolio also may be required
to forego all or a portion of the benefits which might otherwise have been
obtained from favorable movements in exchange rates.
The Portfolio intends to write covered call options on foreign currencies.
A call option written on a foreign currency by the Portfolio is "covered" if the
Portfolio owns the underlying foreign currency covered by the call or has an
absolute and immediate right to acquire that foreign currency without additional
cash consideration (or for additional cash consideration held in a segregated
account by the Custodian) upon conversion or exchange of other foreign currency
held in its portfolio. A call option is also covered if the Portfolio has a call
on the same foreign currency and in the same principal amount as the call
written where the exercise price of the call held (a) is equal to or less than
the exercise price of the call written or (b) is greater than the exercise price
of the call written if the difference is maintained by the Portfolio in cash or
liquid securities in a segregated account with the Custodian.
The Portfolio also intends to write call options on foreign currencies that
are not covered for cross-hedging purposes. A call option on a foreign currency
is for cross-hedging purposes if it is not covered but is designed to provide a
hedge against a decline in the U.S. dollar value of a security which the
Portfolio owns or has the right to acquire and which is denominated in the
currency underlying the option due to an adverse change in the exchange rate. In
such circumstances, the Portfolio will collateralize the option by maintaining
in a segregated account with the Custodian, cash or U.S. government securities
or other high grade liquid debt or equity securities in an amount not less than
the value of the underlying foreign currency in U.S. dollars marked to market
daily.
RISKS OF OPTIONS ON FUTURES CONTRACTS, FORWARD CONTRACTS AND OPTIONS ON FOREIGN
CURRENCIES
Options on foreign currencies and forward contracts are not traded on
contract markets regulated by the CFTC or (with the exception of certain foreign
currency options) by the SEC. To the contrary, such instruments are traded
through financial institutions acting as market-makers, although foreign
currency options are also traded on certain national securities exchanges, such
as the Philadelphia Stock Exchange and the Chicago Board Options Exchange,
subject to the regulation of the Commission. Similarly, options on currencies
may be traded over-the-counter. In an over-the-counter trading environment, many
of the protections afforded to exchange participants will not be available. For
example, there are no daily price fluctuation limits, and adverse market
movements could therefore continue to an unlimited extent over a period of time.
Although the purchaser of an option cannot lose more than the amount of the
premium plus related transaction costs, this entire amount could be lost.
Moreover, the option writer and a trader of forward contracts could lose amounts
substantially in excess of their initial investments, due to the margin and
collateral requirements associated with such positions.
Options on foreign currencies traded on national securities exchanges are
within the jurisdiction of the Commission, as are other securities traded on
such exchanges. As a result, many of the protections provided to
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traders on organized exchanges will be available with respect to such
transactions. In particular, all foreign currency option positions entered into
on a national securities exchange are cleared and guaranteed by the Options
Clearing Corporation ("OCC"), thereby reducing the risk of counterparty default.
Furthermore, a liquid secondary market in options traded on a national
securities exchange may be more readily available than in the over-the-counter
market, potentially permitting the Portfolio to liquidate open positions at a
profit prior to exercise or expiration, or to limit losses in the event of
adverse market movements.
The purchase and sale of exchange-traded foreign currency options, however,
is subject to the risks of the availability of a liquid secondary market
described above, as well as the risks regarding adverse market movements,
margining of options written, the nature of the foreign currency market,
possible intervention by governmental authorities and the effect of other
political and economic events. In addition, exchange-traded options of foreign
currencies involve certain risks not presented by the over-the-counter market.
For example, exercise and settlement of such options must be made exclusively
through the OCC, which has established banking relationships in applicable
foreign countries for this purpose. As a result, the OCC may, if it determines
that foreign governmental restrictions or taxes would prevent the orderly
settlement of foreign currency option exercises, or would result in undue
burdens on the OCC or its clearing member, impose special procedures on exercise
and settlement, such as technical changes in the mechanics of delivery of
currency, the fixing of dollar settlement prices or prohibitions, on exercise.
In addition, futures contracts, options on futures contracts, forward
contracts and options on foreign currencies may be traded on foreign exchanges.
Such transactions are subject to the risk of governmental actions affecting
trading in, or the prices of, foreign currencies or securities. The value of
such positions also could be adversely affected by (i) other complex foreign
political and economic factors, (ii) lesser availability than in the United
States of data on which to make a trading decision, (iii) delays in the
Portfolio's ability to act upon economic events occurring in foreign markets
during non-business hours in the United States, (iv) the imposition of different
exercise and settlement terms and procedures and margin requirements than in the
United States, and (v) lesser trading volume.
INTEREST RATE SWAP TRANSACTIONS
The Portfolio may enter into swap contracts which are also commonly
referred to as derivative investments. A swap is an agreement to exchange the
return generated by one instrument for the return generated by another
instrument. The payment streams are calculated by reference to a specific index
and agreed upon notional amount. The term "specified index" includes fixed
interest rates, total return on interest rate indices and fixed income indices,
(as well as amounts derived from arithmetic operations on these indices). For
example, the Portfolio may agree to swap the return generated by a fixed-income
index for the return generated by a second fixed-income index.
The Portfolio will usually enter into swaps on a net basis, i.e., the two
payment streams are netted out in a cash settlement on the payment date or dates
specified in the instrument, with the Portfolio receiving or paying, as the case
may be, only the net amount of the two payments. The Portfolio's obligations
under a swap agreement will be accrued daily (offsetting against any amounts
owing to the Portfolio) and any accrued but unpaid net amounts owed to a swap
counterparty will be covered by the maintenance of a segregated account
consisting of cash or liquid securities, to avoid any potential leveraging of
the Portfolio. Since swaps will be entered into for good faith hedging purposes,
the Adviser and the Fund believe such obligations do not constitute "senior
securities" under the 1940 Act and, accordingly, will not treat them as being
subject to its borrowing restrictions.
Interest rate swaps do not involve the delivery of securities, other
underlying assets, or principal. Accordingly, the risk of loss with respect to
interest rate swaps is limited to the net amount of interest payments that the
Portfolio is contractually obligated to make. If the other party to the interest
rate swap defaults, the Portfolio's risk of loss consists of the net amount of
interest payments that the Portfolio is contractually entitled to receive. If
there is a default by the counterparty, the Portfolio may have contractual
remedies pursuant to the agreements related to the transaction. The swap market
has grown substantially in recent years with a large number of banks and
investment banking firms acting both as principals and as agents utilizing
standardized swap documentation. As a result, the swap market has become
increasingly liquid.
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PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectuses is calculated by
dividing the lesser of purchases or sales of portfolio securities for the year
by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of acquisition were one year or less. Portfolio turnover may vary greatly
from year to year as well as within a particular year, and may also be affected
by cash requirements for redemptions of shares. See "Financial Highlights" in
the Prospectuses for the historical portfolio turnover rates with respect to the
Portfolio.
PURCHASE AND REDEMPTION OF SHARES
Both classes of shares of the Portfolio may be purchased without a sales
commission at the net asset value per share next determined after an order is
received in proper form by the Fund, and payment is received by the Fund or its
designated Service Agent. The minimum initial investment required for the
Portfolio is $2,500, with certain exceptions as may be permitted from time to
time by the officers of the Fund. Other investment minimums are: initial IRA
investment, $500; initial spousal IRA investment, $250; and additional
investment for all accounts, $100. An order received in proper form prior to
the close of regular trading on the New York Stock Exchange (the "Exchange")
(generally 4:00 p.m. Eastern Time) will be executed at the price computed on the
date of receipt; and an order received not in proper form or after the close of
the Exchange will be executed at the price computed on the next day the Exchange
is open after proper receipt. The Exchange will be closed on the following days:
New Year's Day, Dr. Martin Luther King, Jr.'s Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day.
The Portfolio reserves the right in its sole discretion (1) to suspend the
offering of its shares, (2) to reject purchase orders when in the judgment of
management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of the Portfolio's shares.
The Adviser may compensate affiliated broker-dealer subsidiaries of United
Asset Management Corporation, out of its profits, for referring investors to the
Portfolio and, in certain instances, furnishing information liaison services
with respect to such investors. Such compensation would be based upon the
advisory fees payable (without regard to any expense limitation in effect at the
time) in respect of assets attributable to the referral. If liaison services are
included, the rate would be up to 25% in the first year and up to 15% each year
thereafter; otherwise, the rate would be up to 30% in the first year, 20% for
the second year and 10% for each remaining year up to a total of 5 years.
The Portfolio may suspend redemption privileges or postpone the date of
payment (1) during any period that either the Exchange and custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for a Portfolio to dispose of
securities owned by it or to fairly determine the value of its assets, and (3)
for such other periods as the SEC may permit. The Fund has made an election with
the SEC to pay in cash all redemptions requested by any shareholder of record
limited in amount during any 90-day period to the lesser of $250,000 or 1% of
the net assets of the Fund at the beginning of such period. Such commitment is
irrevocable without the prior approval of the SEC. Redemptions in excess of the
above limits may be paid, in whole or in part, in investment securities or in
cash as the Board of Trustees may deem advisable; however, payment will be made
wholly in cash unless the Trustees believe that economic or market conditions
exist which would make such a practice detrimental to the best interests of the
Fund. If redemptions are paid in investment securities, such securities will be
valued as set forth in the Prospectus under "VALUATION OF SHARES," and a
redeeming shareholder would normally incur brokerage expenses if those
securities were converted to cash.
No charge is made by the Portfolio for redemptions. Any redemption may be
more or less than the shareholder's initial cost depending on the market value
of the securities held by the Portfolio.
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SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services Company
("CGFSC") from fraud, signature guarantees are required for certain redemptions.
The purpose of signature guarantees is to verify the identity of the person who
has authorized a redemption from your account. Signature guarantees are
required for (1) all redemptions when the proceeds are to be paid to someone
other than the registered owner(s) and/or registered address, or (2) share
transfer requests.
Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the transfer agent. Broker-dealers guaranteeing signatures
must be a member of a clearing corporation or maintain net capital of at least
$100,000. Credit unions must be authorized to issue signatures guarantees.
Signature guarantees will be accepted from any eligible guarantor institution
which participates in a signature guarantee program.
The signature guarantee must appear either: (1) on the written request for
redemption; (2) on a separate instrument for assignment ("stock power") which
should specify the total number of shares to be redeemed; or (3) on all stock
certificates tendered for redemption and, if shares held by the Fund are also
being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market
quotations are readily available are value at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed
securities not traded on the valuation date for which market quotations are
readily available are valued neither exceeding the current asked prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is based
upon the bid price of the foreign currency against U.S. dollars as quoted by any
major bank or broker.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Bonds and other fixed income securities may be valued on the
basis of prices provided by a pricing service when such prices are believed to
reflect the fair market value of such securities. Securities purchased with
remaining maturities of 60 days or less are valued at amortized cost, using
methods approved by the Board of Trustees.
The value of other assets and securities for which no quotations are
readily available (including restricted securities) is determined in good faith
at fair value using methods determined by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Portfolio's Prospectuses.
EXCHANGE PRIVILEGE
Institutional Class Shares of the Portfolio may be exchanged for
Institutional Class Shares of any other UAM Funds or UAM Funds, Inc. Portfolio
and Service Class Shares of the Portfolio may be exchanged for Service Class
Shares of any other UAM Funds or UAM Funds, Inc. Portfolio. Exchange requests
should be made by calling the Fund (1-800-638-7983) or by writing to UAM Funds
Trust, UAM Funds Service Center, c/o Chase Global
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Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The exchange
privilege is only available with respect to Portfolios that are qualified for
sale in the shareholder's state of residence.
Any such exchange will be based on the respective net asset values of the
shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objective of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the
shares to be exchanged have not been issued to the shareholder and if the
registration of the two accounts will be identical. Requests for exchanges
received prior to the close of regular trading of the Exchange (generally 4:00
p.m. Eastern Time) will be processed as of the close of business on the same
day. Requests received after the close of regular trading on the Exchange will
be processed on the next business day. Neither the Fund nor CGFSC will be
responsible for the authenticity of the exchange instructions received by
telephone. Exchanges may also be subject to limitations as to amounts or
frequency and to other restrictions established by the Fund's Board of Trustees
to assure that such exchanges do not disadvantage the Fund and its shareholders.
For federal income tax purposes an exchange between Funds is a taxable
event, and, accordingly, a capital gain or loss may be realized. In a revenue
ruling relating to circumstances similar to the Fund's, an exchange between
series of a Fund was also deemed to be a taxable event. It is likely, therefore,
that a capital gain or loss would be realized on an exchange between Portfolios.
You may want to consult your tax adviser for further information in this regard.
The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares of the Portfolio to another person by
making a written request to the Fund. The request should clearly identify the
account and number of shares to be transferred, and include the signature of all
registered owners and all stock certificates, if any, which are subject to the
transfer. The signature on the letter of request, the stock certificate or any
stock power must be guaranteed in the same manner as described under "PURCHASE
AND REDEMPTION OF SHARES." As in the case of redemptions, the written request
must be received in good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in each Prospectus of
the Portfolio. A Portfolio's fundamental investment limitations cannot be
changed without approval by a "majority of the outstanding shares" (as defined
in the 1940 Act) of the Portfolio. Except for the numbered investment
limitations noted as fundamental below, however, the limitations described below
are not fundamental, and may be changed without the consent of shareholders.
Whenever an investment limitation sets forth a percentage limitation on
investment or utilization of assets, such limitation shall be determined
immediately after and as a result of the Portfolio's acquisition of such
security or other asset. Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered when determining whether the investment complies with the Portfolio's
investment limitations.
As a matter of fundamental policy, the Portfolio will not:
(1) invest in physical commodities or contracts on physical
commodities;
(2) purchase or sell real estate or real estate limited partnerships,
although it may purchase and sell securities of companies which deal
in real estate and may purchase and sell securities which are secured
by interests in real estate;
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(3) make loans except (i) by purchasing debt securities in accordance
with its investment objectives and (ii) by lending its portfolio
securities to banks, brokers, dealers and other financial institutions
so long as such loans are not inconsistent with the 1940 Act, or the
rules and regulations or interpretations of the SEC thereunder;
(4) underwrite the securities of other issuers; and
(5) issue senior securities, as defined in the 1940 Act, except that
this restriction shall not be deemed to prohibit the Portfolio from
(i) making any permitted borrowings, mortgages or pledges, or (ii)
entering into options, futures or repurchase transactions.
As a matter of non-fundamental policy, the Portfolio will not:
(1) invest in stock or bond futures and/or options on futures unless
(i) not more than 5% of the Portfolio's assets are required as deposit
to secure obligations under such futures and/or options on futures
contracts provided, however, that in the case of an option that is in-
the-money at the time of purchase, the in-the-money amount may be
excluded in computing such 5% and (ii) not more than 20% of the
Portfolio's assets are invested in stock or bond futures and options;
(2) purchase on margin or sell short except as specified in (5)
above;
(3) invest more than an aggregate of 15% of the net assets of the
Portfolio, determined at the time of investment, in securities subject
to legal or contractual restrictions on resale or securities for which
there are no readily available markets; and
(4) invest for the purpose of exercising control over management of
any company.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are
responsible to the Fund's Board of Trustees. The Trustees set broad policies for
the Fund and elect its Officers. The following is a list of the Trustees and
Officers of the Fund, their addresses and dates of birth, and a brief statement
of their present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
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William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated
person, a $150 quarterly retainer fee per active Portfolio which currently
amounts to $1,350 per quarter. In addition, each unaffiliated Trustee receives a
$2,000 meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management Corporation ("UAM"), or
the Administrator and receive no compensation from the Fund. As of June 15,
1998, the Trustees and officers of the Fund owned less than 1% of the Fund's
outstanding shares.
13
<PAGE>
The following table shows aggregate compensation paid to each of the
Fund's Trustees by the Fund and total compensation paid by the Funds and UAM
Funds, Inc. (collectively the "Fund Complex") in the fiscal year ended April 30,
1998.
14
<PAGE>
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Aggregate Benefits Accrued Annual from Registrant
Name of Person, Compensation From as Part of Benefits Upon and
Position Registrant Fund Expenses Retirement Fund Complex
-------- ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee............. $6,149 0 0 $33,500
Philip D. English
Trustee............. $6,149 0 0 $33,500
William A. Humenuk
Trustee............. $6,149 0 0 $33,500
Nancy J. Dunn
Trustee............. $4,668 0 0 $25,200
Peter M. Whitman, Jr.
Trustee $ 0 0 0 $ 0
Norton H. Reamer
Trustee............. $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDER OF SECURITIES
As of June 15, 1998, the following persons or organizations held of
record or beneficially 5% or more of the shares of the Portfolio:
MJI International Equity Portfolio Institutional Class Shares: Freya
Fanning & Company, 400 Essex St., Box 5600, Beverly Farms, MA, 49.7%*; UMBSC &
Co., FBO Interstate Brands Aggressive Growth., P.O. Box 419260, Kansas City, MO,
19.2%*; and UMBSC & Co., FBO Interstate Brands Moderate Growth., P.O. Box
419260, Kansas City, MO, 11.2%*.
MJI International Equity Portfolio Institutional Service Class Shares:
Sisters of Mercy Corp., 2300 Adeline Drive, Burlingame, CA, 30.6%*; Wilmington
Trust Co., Trustee, FBO Hoag Hospital Aggressive Lifestyle, c/o Mutual
Funds/UAM, P.O. Box 8971, Wilmington, DE, 16.9%*; Hartnat & Co. and Siliconix
MJI International Equity, P.O. Box 92800, Rochester, NY, 14.9%*; Wilmington
Trust Co. ,Trustee, FBO Davies Medical Pension Plan, c/o Mutual Funds, 1100
North Market Street, Wilmington, DE, 11.9%*; and Wilmington Trust Co., Trustee,
FBO Hoag Hospital Aggressive Lifestyle, c/o Mutual Funds UAM, P.O. Box 8971,
Wilmington, DE, 9.6%*.
15
<PAGE>
The persons(s) or organization(s) listed above as owning 25% or more
of the outstanding shares of the Portfolio may be presumed to "control" (as that
term is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
- ------
* Denotes shares held by a trustee or fiduciary for which beneficial ownership
is disclaimed or presumed disclaimed.
INVESTMENT ADVISER
INVESTMENT PHILOSOPHY
A value orientation for country, currency and stock selection is key
to Murray Johnstone's investment philosophy. Murray Johnstone's management
structure centers around regional research teams which are specialized by
geography. The individuals within each team are responsible for conducting
research within each region as well as identifying particular stocks for
possible inclusion within portfolios. On-site, fundamental research is a primary
component of the evaluation process.
CONTROL OF ADVISER
The Adviser, through its parent, UAM UK Holdings, is a wholly-owned
subsidiary of UAM, a holding company incorporated in Delaware in December 1980
for the purpose of acquiring and owning firms engaged primarily in institutional
investment management. Since its first acquisition in August 1983, UAM has
acquired or organized over 45 such wholly-owned affiliated firms (the "UAM
Affiliated Firms"). UAM believes that permitting UAM Affiliated Firms to retain
control over their investment advisory decisions is necessary to allow them to
continue to provide investment management services that are intended to meet the
particular needs of their respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue
to operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc., a registered investment company.
REPRESENTATIVE INSTITUTIONAL CLIENTS
As of the date of this SAI, the Adviser's representative institutional
clients included: Ace Hardware, American Cancer Society, Royal Caribbean
Cruises, Siemens, Levitz, Franciscan Sisters, Rhode Island School of Design,
Government of Guam, City of Albany and Arkansas Police & Fire Retirement
Systems.
In compiling this client list, the Adviser used objective criteria
such as account size, geographic location and client classification. The Adviser
did not use any performance based criteria. It is not known whether these
clients approve or disapprove of the Adviser or the advisory services provided.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the
Fund and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously
16
<PAGE>
review, supervise and administer the Portfolio's investment program, and to
determine in its discretion the securities to be purchased or sold and the
portion of the Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross
negligence on the part of the Adviser in the performance of its obligations and
duties under the Agreement, (ii) reckless disregard by the Adviser of its
obligations and duties under the Agreement, or (iii) a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services, the Adviser shall not be subject to any liability whatsoever to the
Fund, or to any shareholder of the Fund, for any error of judgment, mistake of
law or any other act or omission in the course of, or connected with, rendering
services under the Agreement.
Unless sooner terminated, the Agreement shall continue for periods of
one year so long as such continuance is specifically approved at least annually
(a) by the vote of a majority of those members of the Board of Trustees of the
Fund who are not parties to the Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval, (b) by the Board of Trustees of the Fund, or (c) by a vote of a
majority of the outstanding voting securities of the Portfolio. The Agreement
may be terminated at any time by the Portfolio, without the payment of any
penalty, by vote of a majority of the entire Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Portfolio on 60
days written notice to the Adviser. The Agreement may be terminated by the
Adviser at any time, without the payment of any penalty, upon 90 days written
notice to the Fund. The Agreement will automatically and immediately terminate
in the event of its assignment.
17
<PAGE>
ADVISORY FEES
As compensation for services rendered by the Adviser under the
Investment Advisory Agreement, the Portfolio pays the Adviser an annual fee in
monthly installments, calculated by applying the following annual percentage
rates to the Portfolio's average daily net assets for the month:
Rate
MJI International Equity Portfolio..............................0.75%
For the fiscal years ended April 30, 1996, April 30, 1997 and April
30, 1998, the MJI International Equity Portfolio paid advisory fees of $0,
$41,961 and $284,464 respectively. The Adviser voluntarily waived advisory fees
of $54,000, $99,017 and $0, for the fiscal years ended April 30, 1996, April 30,
1997 and April 30, 1998, respectively. Until further notice, the Adviser has
voluntarily agreed to waive its advisory fees and to assume as the Adviser's own
expense certain operating expenses payable by the Portfolio, if necessary, in
order to keep the Portfolio's total annual operating expenses from exceeding
1.50%.
SERVICE AND DISTRIBUTION PLANS
As stated in the Portfolio's Service Class Shares Prospectus, the
"Distributor" may enter into agreements with broker-dealers and other financial
institutions ("Service Agents"), pursuant to which they will provide
administrative support services to Service Class shareholders who are their
customers ("Customers") in consideration of the Fund's payment of 0.25% (on an
annualized basis) of the average daily net asset value of the Service Class
Shares held by the Service Agent for the benefit of its Customers. Such services
include:
(a) acting as the sole shareholder of record and nominee for
beneficial owners;
(b) maintaining account records for such beneficial owners of the
Fund's shares;
(c) opening and closing accounts;
(d) answering questions and handling correspondence from shareholders
about their accounts;
(e) processing shareholder orders to purchase, redeem and exchange
shares;
(f) handling the transmission of funds representing the purchase price
or redemption proceeds;
(g) issuing confirmations for transactions in the Fund's shares by
shareholders;
(h) distributing current copies of prospectuses, statements of
additional information and shareholder reports;
(i) assisting customers in completing application forms, selecting
dividend and other account options and opening any necessary
custody accounts;
(j) providing account maintenance and accounting support for all
transactions; and
(k) performing such additional shareholder services as may be agreed
upon by the Fund and the Service Agent, provided that any such
additional shareholder services must constitute a permissible non-
banking activity in accordance with the then current regulations
of, and interpretations thereof by, the Board of Governors of the
Federal Reserve System, if applicable.
18
<PAGE>
Each agreement with a Service Agent is governed by a Shareholder Service
Plan (the "Service Plan") that has been adopted by the Fund's Board of Trustees.
Pursuant to the Service Plan, the Board of Trustees reviews, at least quarterly,
a written report of the amounts expended under each agreement with Service
Agents and the purposes for which the expenditures were made. In addition,
arrangements with Service Agents must be approved annually by a majority of the
Fund's Trustees, including a majority of the Trustees who are not "interested
persons" of the company as defined in the 1940 Act and have no direct or
indirect financial interest in such arrangements.
The Board of Trustees has approved the arrangements with Service Agents
based on information provided by the Fund's service contractors that there is a
reasonable likelihood that the arrangements will benefit the Fund and its
shareholders by affording the Fund greater flexibility in connection with the
servicing of the accounts of the beneficial owners of its shares in an efficient
manner. Any material amendment to the Fund's arrangements with Service Agents
must be approved by a majority of the Fund's Board of Trustees (including a
majority of the disinterested Trustees). So long as the arrangements with
Service Agents are in effect, the selection and nomination of the members of the
Fund's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of the Company will be committed to the discretion of such non-
interested Trustees.
The Service Plan may be terminated at any time by vote of a majority of the
Trustees of the Fund who are not "interested persons" of the Fund and who have
no direct or indirect financial interest in the operation of the Service Plan or
any agreements related to the Service Plan or, at the discretion of the Board of
Trustees of the Fund, by vote of a majority of the outstanding voting securities
of the Fund.
Pursuant to Rule 12b-1 under the 1940 Act, the Fund has adopted a
Distribution Plan for the Service Class Shares of the Fund (the "Distribution
Plan"). The Distribution Plan permits the Fund to pay for certain distribution,
promotional and related expenses involved in the marketing of only the Service
Class Shares.
The Distribution Plan permits the Service Class Shares, pursuant to the
Distribution Agreement, to pay a monthly fee to the Distributor for its services
and expenses in distributing and promoting sales of the Service Class Shares.
These expenses include, among other things, advertising the availability of
services and products; designing materials to send to customers and developing
methods of making such materials accessible to customers; providing information
about the product needs of customers; providing facilities to solicit Fund sales
and to answer questions from prospective and existing investors about the Fund;
receiving and answering correspondence from prospective investors, including
requests for sales literature, prospectuses and statements of additional
information; displaying and making sales literature and prospectuses available;
and acting as liaison between shareholders and the Fund, including obtaining
information from the Fund and providing performance information about the Fund.
In addition, the Service Class Shares may make payments directly to other
unaffiliated parties, who either aid in the distribution of their shares or
provide services to the Class.
The maximum annual aggregate fee payable by the Fund under the Service and
Distribution Plans (the "Plans"), is 0.75% of the Service Class Shares' average
daily net assets for the year. The Fund's Board of Trustees may reduce this
amount at any time. Although the maximum fee payable under the 12b-1 Plan
relating to the Service Class Shares is 0.75% of average daily net assets of
such class, the Board of Trustees has determined that the annual fee, payable on
a monthly basis, under the Plans relating to the Service Class Shares, currently
cannot exceed .50% of the average daily net assets represented by the Service
Class. While the current fee which will be payable under the Service Plan and
Distribution Plan has been set at .25%, the Plans permit a full 0.75% on all
assets to be paid at any time following appropriate Board approval.
All of the distribution expenses incurred by the Distributor and others,
such as broker/dealers, in excess of the amount paid by the Service Class Shares
will be borne by such persons without any reimbursement from such Classes.
Subject to seeking best price and execution, the Fund may, from time to time,
buy or sell portfolio securities from or to firms which receive payments under
the Plans. From time to time, the Distributor may pay additional
19
<PAGE>
amounts from its own resources to dealers for aid in distribution or for aid in
providing administrative services to shareholders.
The Plans, the Distribution Agreement and the form of dealer's and services
agreements have all been approved by the Board of Trustees of the Fund,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund and who have no direct or indirect
financial interest in the Plans or any related agreements, by vote cast in
person at a meeting duly called for the purpose of voting on the Plan and such
Agreements. Continuation of the Plans, the Distribution Agreement and the
related agreements must be approved annually by the Board of Trustees in the
same manner, as specified above.
Each year the Trustees must determine whether continuation of the Plans is
in the best interest of the shareholders of Service Class Shares and that there
is a reasonable likelihood of the Plans providing a benefit to the Class. The
Plans, the Distribution Agreement and the related agreements with any broker-
dealer or others relating to the Class may be terminated at any time without
penalty by a majority of those trustees who are not "interested persons" or by a
majority vote of the outstanding voting securities of the Class. Any amendment
materially increasing the maximum percentage payable under the Plans must
likewise be approved by a majority vote of the relevant Class' outstanding
voting securities, as well as by a majority vote of those Trustees who are not
"interested persons." Also, any other material amendment to the Plans must be
approved by a majority vote of the Trustees including a majority of the Trustees
of the Fund having no interest in the Plans. In addition, in order for the Plans
to remain effective, the selection and nomination of Trustees who are not
"interested persons" of the Fund must be effected by the Trustees who themselves
are not "interested persons" and who have no direct or indirect financial
interest in the Plans. Persons authorized to make payments under the Plans must
provide written reports at least quarterly to the Board of Trustees for their
review. The National Association of Securities Dealers Regulation, Inc. has
adopted amendments to its Conduct Rules relating to investment company sales
charges. The Fund and the Distributor intend to operate in compliance with these
rules.
During the fiscal year ended April 30, 1998, the Portfolio's Service Class
Shares paid $15,037 for services provided pursuant to the Distribution Plan.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreements authorize the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio.
The Adviser may, however, consistent with the interests of the Portfolio, select
brokers on the basis of the research, statistical and pricing services they
provide to the Portfolio. Information and research received from such brokers
will be in addition to, and not in lieu of, the services required to be
performed by the Adviser under the Investment Advisory Agreements. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect principal
transactions with dealers on the basis of sales of Fund shares which may be made
through broker-dealer firms. However, the Adviser may place portfolio orders
with qualified broker-dealers who refer clients to the Adviser. During the
fiscal years ended April 30, 1996, April 30, 1997 and April 30, 1998, the MJI
International Equity Portfolio paid aggregate brokerage commissions of $44,004,
$102,419 and $173,063, respectively. The difference in brokerage commissions
paid between fiscal years April 30, 1997 and 1998, was the result of growth in
the portfolio's assets.
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of a Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser.
20
<PAGE>
Although there is no specified formula for allocating such transactions, the
various allocation methods used by the Adviser, and the results of such
allocations, are subject to periodic review by the Fund's Board of Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration Agreement
("Fund Administration Agreement"), effective April 15, 1996, between UAMFSI, a
wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of the Fund
Administration Agreement. UAMFSI manages, administers and conducts the general
business activities of the Fund other than those which have been contracted to
other third parties by the Fund. Additionally, UAMFSI has agreed to provide
transfer agency services to the Portfolio pursuant to the terms of the Fund
Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC, an affiliate of
The Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement between
UAMFSI and CGFSC (collectively, with the Fund Administration Agreement, the
"Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a two-
part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and a
sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
Annual Rate
MJI International Equity Portfolio..............................0.06%
CGFSC's monthly fee for its services is calculated on an annualized basis
as follows:
0.19 of 1% of the first $200 million of combined Fund net assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion but
less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,00 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds Services
Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
For the fiscal years ended April 30, 1996, April 30, 1997 and April 30,
1998, administrative services fees paid to CGFSC by the MJI International Equity
Portfolio totaled
21
<PAGE>
$69,866, $96,855 and $105,743, respectively. For the period April 15, 1996 to
April 30, 1996, and for the fiscal years ended April 30, 1997 and April 30,
1998, UAMFSI earned $3,134, $11,239 and $22,754, respectively, from the MJI
International Equity Portfolio as Administrator. The services provided by UAMFSI
and CGFSC and the basis of the current fees payable are described in the
Portfolio's Prospectuses.
UAMFSI will bear all expenses in connection with the performance of
its services under the Fund Administration Agreement. Other expenses to be
incurred in the operation of the Fund will be borne by the Fund or other
parties, including taxes, interest, brokerage fees and commissions, if any,
salaries and fees of officers and members of the Board who are not officers,
directors, shareholders or employees of UAMFSI, or the Fund's investment adviser
or distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund Administration
Agreement is terminable, without penalty, by the Board or by UAMFSI, on not less
than ninety (90) days' written notice. The Fund Administration Agreement shall
automatically terminate upon its assignment by UAMFSI without the prior written
consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person or
persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Portfolio paid
$30,161 in fees pursuant to the Services Agreement, of which $27,286 were
voluntarily waived.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New
York 11245, provides for the custody of the Fund's assets pursuant to the terms
of a custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110,
serves as independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves
as the Fund's Distributor. Shares of the Fund are offered continuously. While
the Distributor will use its best efforts to sell shares of the
22
<PAGE>
Fund, it is not obligated to sell any particular amount of shares. The
Distributor received no compensation for its services from the Portfolio during
the fiscal year ended April 30, 1998.
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures
to illustrate the past performance of each class of the Portfolio. Performance
quotations by investment companies are subject to rules adopted by the SEC,
which require the use of standardized performance quotations or, alternatively,
that every non-standardized performance quotation furnished by the Portfolio be
accompanied by certain standardized performance information computed as required
by the SEC. Current yield and average annual compounded total return quotations
used by the Fund are based on the standardized methods of computing performance
mandated by the SEC. An explanation of the method used to compute or express
performance follows.
TOTAL RETURN
The average annual total return of a Portfolio is determined by
finding the average annual compounded rates of return over 1, 5 and 10 year
periods that would equate an initial hypothetical $1,000 investment to its
ending redeemable value. The calculation assumes that all dividends and
distributions are reinvested when paid. The quotation assumes the amount was
completely redeemed at the end of each 1, 5 and 10 year period and the deduction
of all applicable Fund expenses on an annual basis. Since Service Class Shares
of the Portfolio bear additional service and distribution expenses, the average
annual total return of the Service Class Shares of the Portfolio will generally
be lower than that of the Institutional Class Shares.
The average annual total return for the MJI International Equity
Portfolio Institutional Class and Institutional Service Class Shares from
inception to April 30, 1998, and for the one year period ended on the date of
the Financial Statements incorporated hereby by reference are as follows:
<TABLE>
<CAPTION>
Since Inception
One Year Through Year
Ended Ended
April 30, April 30 Inception
1998 1998 Date
---------- ---------------- ---------
<S> <C> <C> <C>
MJI International Equity Portfolio 20.39% 7.53% 9/16/94
Institutional Class Shares.........................
MJI International Equity Portfolio 20.11% 15.73% 12/31/96
Institutional Service Class Shares.................
</TABLE>
These figures are calculated according to the following formula:
P (1 + T)/n/ = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1, 5 or 10 year periods at
the end of the 1, 5 or 10 year periods (or fractional
portion thereof).
COMPARISONS
23
<PAGE>
To help investors better evaluate how an investment in a Portfolio of the Fund
might satisfy their investment objective, advertisements regarding the Portfolio
may discuss various measures of Portfolio performance as reported by various
financial publications. Advertisements may also compare performance (as
calculated above) to performance as reported by other investments, indices and
averages. Please see Appendix B for publications, indices and averages which may
be used.
In assessing such comparisons of performance, an investor should keep in mind
that the composition of the investments in the reported indices and averages is
not identical to the composition of investments in the Portfolio, that the
averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name "The Regis Fund II," as a Delaware
business trust on May 18, 1994. On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's principal executive office is located
at One International Place, 44th Floor, Boston, MA 02110; however, all investor
correspondence should be addressed to the Fund at UAM Funds Service Center, c/o
Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
Fund's Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest, without par value. The Trustees have
the power to designate one or more series ("Portfolios") of shares of beneficial
interest without further action by shareholders.
The Board of Trustees has classified an additional class of shares in the
Portfolio, known as Advisor Shares. As of the date of this Statement of
Additional Information, no Advisor Shares have been offered by the Portfolio.
The shares of the Portfolio, when issued and paid for as provided for in its
Prospectus, will be fully paid and nonassessable, have no preference as to
conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which means that the holders of more than 50% of the shares voting for the
election of Trustees can elect 100% of the Trustees if they choose to do so. A
shareholder is entitled to one vote for each full share held (and a fractional
vote for each fractional share held), then standing in his or her name on the
books of the Fund. Institutional Class, Service Class and Advisor Class Shares
each represent an interest in the same assets of a Portfolio and are identical
in all respects except that the Service Class Shares bear certain expenses
related to shareholder servicing and the distribution of such shares, and have
exclusive voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the shares of each
Portfolio or any class thereof that has been established and designated shall be
entitled to receive, when and as declared by the Trustees, the excess of the
assets belonging to that Portfolio, or in the case of a class, belonging to that
Portfolio and allocable to that class, over the liabilities belonging to that
Portfolio or class. The assets so distributable to the holders of shares of any
particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
24
<PAGE>
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of each Portfolio's net
investment income, if any, together with any net realized capital gains annually
in the amount and at the times that will avoid both income (including capital
gains) taxes incurred on it and the imposition of the federal excise tax on
undistributed income and capital gains. The amounts of any income dividends or
capital gains distributions cannot be predicted. See the discussion under
"Dividends, Capital Gains Distributions and Taxes" in the Prospectuses.
Any dividend or distribution paid shortly after the purchase of shares of a
Portfolio by an investor may have the effect of reducing the per share net asset
value of the Portfolio by the per share amount of the dividend or distribution.
Furthermore, such dividends or distributions, although in effect a return of
capital, are subject to income taxes as set forth in the Prospectuses.
As set forth in the Prospectuses, unless the shareholder elects otherwise in
writing, all dividend and capital gains distributions are automatically
reinvested in additional shares of the respective Portfolio of the Fund at net
asset value (as of the business day following the record date). This will remain
in effect until the Fund is notified by the shareholder in writing at least
three days prior to the record date that either the Income Option (income
dividends in cash and capital gains distributions in additional shares at net
asset value) or the Cash Option (both income dividends and capital gains
distributions in cash) has been elected. An account statement is sent to
shareholders whenever an income dividend or capital gains distribution is paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain extent
personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
25
<PAGE>
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's Annual
Report to Shareholders (the "1998 Annual Report") are incorporated by reference
into this Statement of Additional Information. No other parts of the 1998 Annual
Report are incorporated by reference herein. The Financial Statements included
in the 1998 Annual Report have been audited by the Fund's independent
accountants, PricewaterhouseCoopers LLP. The reports of PricewaterhouseCoopers
LLP are incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such reports given upon the authority of
PricewaterhouseCoopers LLP as experts in accounting and auditing. Copies of the
1998 Annual Report may be obtained free of charge by telephoning the UAM Funds
Service Center at the telephone number appearing on the front page of this
Statement of Additional Information.
26
<PAGE>
APPENDIX A -- DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
MOODY'S INVESTORS SERVICE CORPORATE BOND RATINGS
Aaa -- Bonds which are Aaa are judged to be 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.
Moody's Investors Service ("Moody's") applies numerical modifiers 1, 2 and
3 in the Aa and A rating categories. The modifier 1 indicates that the security
ranks at a higher end of the rating category, modifier 2 indicates a mid-range
rating and modifier 3 indicates that the issue ranks at the lower end of the
rating category.
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.
STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to 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 -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
II. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
A-1
<PAGE>
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
and may not be able to assess a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, Federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the GNMA are, in effect, backed
by the full faith and credit of the United States through provisions in their
charters that they may make "indefinite and unlimited" drawings on the U.S.
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and FNMA, is not
guaranteed by the United States, but those institutions are protected by the
discretionary authority of the U.S. Treasury to purchase certain amounts of
their securities to assist the institution in meeting its debt obligations.
Finally, other agencies and instrumentalities, such as the Farm Credit System
and the FHLMC, are federally chartered institutions under Government
supervision, but their debt securities are backed only by the creditworthiness
of those institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
III. DESCRIPTION OF COMMERCIAL PAPER
The Portfolios may invest in commercial paper (including variable amount
master demand notes) rated A-1 or better by Standard & Poor's ("S&P") or Prime-1
by Moody's or by S&P. Commercial paper refers to short-term, unsecured
promissory notes issued by corporations to finance short-term credit needs.
Commercial paper is usually sold on a discount basis and has a maturity at the
time of issuance not exceeding nine months. Variable amount master demand notes
are demand obligations that permit the investment of fluctuating amounts at
varying market rates of interest pursuant to arrangement between the issuer and
a commercial bank acting as agent for the payees of such notes whereby both
parties have the right to vary the amount of the outstanding indebtedness on the
notes. As variable amount master demand notes are direct lending arrangements
between a lender and a borrower, it is not generally contemplated that such
instruments will be traded, and there is no secondary market for these notes,
although they are redeemable (and thus immediately repayable by the borrower) at
face value, plus accrued interest, at any time. In connection with the
Portfolio's investment in variable amount master demand notes, the Adviser's
investment management staff will monitor, on an ongoing basis, the earning
power, cash flow and other liquidity ratios of the issuer and the borrower's
ability to pay principal and interest on demand.
Commercial paper rated A-1 by S&P has the following characteristics: (1)
liquidity ratios are adequate to meet cash requirements; (2) long-term senior
debt is rated "A" or better; (3) the issuer has access to at least two
additional channels of borrowing; (4) basic earnings and cash flow have an
upward trend with allowance made for unusual circumstances; (5) typically, the
issuer's industry is well established, and the issuer has a strong position
within the industry; and (6) the reliability and quality of management are
unquestioned. Relative strength or weakness of the above factors determine
whether the issuer's commercial paper is A-1, A-2 or A-3. The rating Prime-1 is
the highest commercial paper rating assigned by Moody's. Among the factors
considered by Moody's in assigning ratings are the following: (1) evaluation of
the management of the issuer; (2) economic evaluation of the issuer's industry
or industries and the appraisal of speculative-type risks which may be inherent
in certain areas; (3) evaluation of the issuer's products in relation to
completion and customer acceptance; (4) liquidity; (5) amount and quality of
long term debt; (6) trend of earnings over a period of ten years; (7) financial
strength of a parent company and the relationships which exist with the issuer;
and (8) recognition by the management of issuer of obligations which may be
present or may arise as a result of public interest questions and preparations
to meet such obligations.
A-2
<PAGE>
IV. DESCRIPTION OF BANK OBLIGATIONS
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Certificates of deposit are negotiable short-term obligations of commercial
banks. Variable rate certificates of deposit are certificates of deposit on
which the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. As a result of these adjustments, the
interest rate on these obligations may increase or decrease periodically.
Frequently, dealers selling variable rate certificates of deposit to the
Portfolio will agree to repurchase such instruments, at the Portfolio's option,
at par on or near the coupon dates. The dealers' obligations to repurchase these
instruments are subject to conditions imposed by various dealers. Such
conditions typically are the continued credit standing of the issuer and the
existence of reasonably orderly market conditions. The Portfolio is also able to
sell variable rate certificates of deposit in the secondary market. Variable
rate certificates of deposit normally carry a higher interest rate than
comparable fixed rate certificates of deposit. A banker's acceptance is a time
draft drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction to finance the import, export, transfer or
storage of goods. The borrower is liable for payment as well as the bank which
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
the secondary markets prior to maturity.
V. DESCRIPTION OF FOREIGN INVESTMENTS
Investors should recognize that investing in foreign companies involves
certain special considerations which are not typically associated with investing
in U.S. companies. Since the securities of foreign companies are frequently
denominated in foreign currencies, a Portfolio may be affected favorably or
unfavorably by changes in currency rates and in exchange control regulations,
and may incur costs in connection with conversions between various currencies.
As foreign companies are not generally subject to uniform accounting,
auditing and financial reporting standards and they may have policies that are
not comparable to those of domestic companies, there may be less information
available about certain foreign companies than about domestic companies.
Securities of some foreign companies are generally less liquid and more volatile
than securities of comparable domestic companies. There is generally less
government supervision and regulation of stock exchanges, brokers and listed
companies than in the U.S. In addition, with respect to certain foreign
countries, there is the possibility of expropriation or confiscatory taxation,
political or social instability, or diplomatic developments which could affect
U.S. investments in those countries.
Although the Fund will endeavor to achieve the most favorable execution
costs in its portfolio transactions, fixed commissions on many foreign stock
exchanges are generally higher than negotiated commissions on U.S. exchanges.
Certain foreign governments levy withholding taxes on dividend and interest
income. Although in some countries a portion of these taxes are recoverable, the
non-recoverable portion of foreign withholding taxes will reduce the income
received from the companies comprising the Fund's Portfolios. However, these
foreign withholding taxes are not expected to have a significant impact.
A-3
<PAGE>
APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an
unmanaged index composed of 30 blue-chip industrial corporation
stocks (Dow Jones Industrial Average), 15 utilities company
stocks and 20 transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic
stocks chosen for market size, liquidity, and industry group
representation. It is also a market-value weighted index and was
the first benchmark of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation
and finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents
the return on the market value of all common equity securities
for which daily pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed
Income Fund Performance Analysis -- measure total return and
average current yield for the mutual fund industry. Rank
individual mutual fund performance over specified time periods,
assuming reinvestment of all distributions, exclusive of any
applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at
maximum capital appreciation, frequently by means of 100% or more
portfolio turnover, leveraging, purchasing unregistered
securities, purchasing options, etc. The fund may take large cash
positions.
(h) Lipper Small Cap Funds Index- a fund that by prospectus or
portfolio practice invests primarily in companies with market
capitalizations of less than $1 billion at the time of purchase.
(i) Morgan Stanley Capital International EAFE Index and World Index -
- respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges
of countries in Europe, Australia and the Far East, and over
1,400 securities listed on the stock exchanges of these
continents, including North America.
(j) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated
by screening for convertible issues of 100 million or greater in
market capitalization. The index is priced monthly.
(k) Salomon Brothers GNMA Index -- includes pools of mortgages
originated by private lenders and guaranteed by the mortgage
pools of the Government National Mortgage Association.
B-1
<PAGE>
(l) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA.
It is a value-weighted, total return index, including
approximately 800 issues with maturities of 12 years or greater.
(m) Salomon Brothers Broad Investment Grade Bond Index -- is a
market-weighted index that contains approximately 4,700
individually priced investment grade corporate bonds rated BBB or
better, U.S. Treasury/agency issues and mortgage pass through
securities.
(n) Lehman Brothers Long-Term Treasury Bond Index -- is composed of
all bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(o) Lehman Brothers Government/Corporate Index -- is a combination of
the Government and Corporate Bond Indices. The Government Index
includes public obligations of the U.S. Treasury, issues of
Government agencies, and corporate debt backed by the U.S.
Government. The Corporate Bond Index includes fixed-rate
nonconvertible corporate debt. Also included are Yankee Bonds and
nonconvertible debt issued by or guaranteed by foreign or
international governments and agencies. All issues are investment
grade (BBB) or higher, with maturities of at least one year and
an outstanding par value of at least $100 million for U.S.
Government issues and $25 million for others. Any security
downgraded during the month is held in the index until month-end
and then removed. All returns are market value weighted inclusive
of accrued income.
(p) NASDAQ Industrial Index -- is composed of more than 3,000
industrial issues. It is a value-weighted index calculated on
price change only and does not include income.
(q) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(r) Russell 2000 Index -- composed of the 2,000 smallest stocks in
the Russell 3000, a market value-weighted index of the 3,000
largest U.S. publicly-traded companies.
(s) Salomon Brothers 3 Month T-Bill Average - the average return for
all Treasury bills for the previous three month period.
(t) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30%
Lehman Brothers Long-Term Treasury Bond and 10% U.S. Treasury
Bills; 70% Standard & Poor's 500 Stock Index and 30% NASDAQ
Industrial Index; 35% Standard & Poor's 500 Stock Index and 65%
Salomon Brothers High Grade Bond Index; all stocks on the NASDAQ
system exclusive of those traded on an exchange, and 65% Standard
& Poor's 500 Stock Index and 35% Salomon Brothers High Grade Bond
Index.
(u) CDA Mutual Fund Report published by CDA Investment Technologies,
Inc. -- analyzes price, current yield, risk, total return and
average rate of return (average compounded growth rate) over
specified time periods for the mutual fund industry.
(v) Mutual Fund Source Book published by Morningstar, Inc. --
analyzes price, yield, risk and total return for equity funds.
(w) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest,
Financial Times, Global Investor, Wall Street Journal and
Weisenberger Investment Companies Service -- publications that
rate fund performance over specified time periods.
B-2
<PAGE>
(x) Consumer Price Index (or Cost of Living Index), published by the
U.S. Bureau of Labor Statistics -- a statistical measure of
change over time in the price of goods and services in major
expenditure groups.
(y) Stocks, Bonds, Bills and Inflation, published by Ibbotson
Associates -- historical measure of yield, price and total return
for common and small company stock, long-term government bonds,
U.S. Treasury bills and inflation.
(z) Savings and Loan Historical Interest Rates -- as published by the
U.S. Savings & Loan League Fact Book.
(aa) Historical data supplied by the research departments of First
Boston Corporation; the J.P. Morgan companies; Salomon Brothers;
Merrill Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and
Bloomberg L.P.
B-3
<PAGE>
PART B
UAM FUNDS
TJ CORE EQUITY PORTFOLIO
Institutional Service Class Shares
STATEMENT OF ADDITIONAL INFORMATION -- July 17, 1998
This Statement of Additional Information ("SAI") is not a Prospectus but
should be read in conjunction with the Prospectus of the UAM Funds Trust (the
"UAM Funds" or the "Fund") for the TJ Core Equity Portfolio (the "Portfolio")
Institutional Service Class Shares (the "Service Class Shares") dated July 17,
1998. To obtain the Prospectus, please call the UAM Funds Service Center at 1-
800-638-7983.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT OBJECTIVE AND POLICIES........................................ 2
PURCHASE AND REDEMPTION OF SHARES........................................ 5
VALUATION OF SHARES...................................................... 7
SHAREHOLDER SERVICES..................................................... 7
INVESTMENT LIMITATIONS................................................... 8
MANAGEMENT OF THE FUND................................................... 9
INVESTMENT ADVISER....................................................... 11
SERVICE AND DISTRIBUTION PLANS........................................... 12
PORTFOLIO TRANSACTIONS................................................... 15
ADMINISTRATIVE SERVICES.................................................. 15
CUSTODIAN................................................................ 17
INDEPENDENT ACCOUNTANTS.................................................. 17
DISTRIBUTOR.............................................................. 17
PERFORMANCE CALCULATIONS................................................. 17
GENERAL INFORMATION...................................................... 18
FINANCIAL STATEMENTS..................................................... 19
APPENDIX A - DESCRIPTION OF SECURITIES AND RATINGS....................... A-1
APPENDIX B - COMPARISONS................................................. B-1
</TABLE>
Investment Adviser
Tom Johnson Investment Management, Inc. (Adviser)
Distributor
UAM Fund Distributors, Inc. (Distributor)
Administrator and Transfer Agent
UAM Fund Services, Inc. (UAMFSI)
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
The following discussion supplements the discussion of investment
objective and policies of the Portfolio as set forth in the Portfolio's
Prospectus.
FOREIGN SECURITIES
Investors should recognize that investing in foreign companies
directly or through the purchase of American Depositary Receipts ("ADRs")
involves certain special considerations which are not typically associated with
investing in U.S. companies. Since the securities of foreign companies are
frequently denominated in foreign currencies, investments may be affected
favorably or unfavorably by changes in currency rates and in exchange control
regulations, and may incur costs in connection with conversions between various
currencies.
As foreign companies are not generally subject to uniform accounting,
auditing and financial reporting standards and they may have policies that are
not comparable to those of domestic companies, there may be less information
available about certain foreign companies than about domestic companies.
Securities of some foreign companies are generally less liquid and more volatile
than securities of comparable domestic companies. There is generally less
government supervision and regulation of stock exchanges, brokers and listed
companies than in the U.S. In addition, with respect to certain foreign
countries, there is the possibility of expropriation or confiscatory taxation,
political or social instability, or diplomatic developments which could affect
U.S. investments in those countries.
Certain foreign governments levy withholding taxes on dividend and
interest income. Although in some countries a portion of these taxes are
recoverable, the non-recoverable portion of foreign withholding taxes will
reduce the income received from the companies comprising the Portfolio's
investments. However, these foreign withholding taxes are not expected to have a
significant impact.
LENDING OF SECURITIES
The Portfolio may lend its investment securities to qualified brokers,
dealers, domestic and foreign banks or other financial institutions, so long as
the terms, the structure and the aggregate amount of such loans are not
inconsistent with the Investment Company Act of 1940, as amended, (the "1940
Act") or the Rules and Regulations or interpretations of the Securities and
Exchange Commission (the "SEC") thereunder, which currently require that (a) the
borrower pledge and maintain with the Portfolio collateral consisting of cash,
an irrevocable letter of credit issued by a domestic U.S. bank or securities
issued or guaranteed by the United States Government having a value at all times
of not less than 100% of the value of the securities loaned, (b) the borrower
add to such collateral whenever the price of the securities loaned rises (i.e.,
the borrower "marks to the market" on a daily basis), (c) the loan be made
subject to termination by the Portfolio at any time, and (d) the Portfolio
receives reasonable interest on the loan (which may include the Portfolio
investing any cash collateral in interest bearing short-term investments). The
Portfolio will not loan securities to the extent that greater than one-third of
its assets (including the value of the collateral for the loans) at fair market
value would be committed to loans. As with other extensions of credit, there
are risks of delay in recovery or even loss of rights in the securities loaned
if the borrower of the securities fails financially. These risks are similar to
the ones involved with repurchase agreements as discussed in the Prospectus.
HEDGING STRATEGIES
The Portfolio may engage in various portfolio strategies to hedge
against adverse movements in the equity, debt and currency markets. The
Portfolio may buy or sell futures contracts, write (i.e., sell) covered call
options on its portfolio securities, purchase put and call options on securities
and engage in transactions in stock index options and stock index futures, and
related options on such futures. Each of these portfolio strategies is described
below. Although certain risks are involved in options and futures transactions,
the Adviser believes that, because the
2
<PAGE>
Portfolio will engage in options and futures transactions only for hedging
purposes, the options and futures portfolio strategies of the Portfolio will not
subject it to the risks frequently associated with the speculative use of
options and futures transactions. While the Portfolio's use of hedging
strategies is intended to reduce the volatility of the net asset value of the
Portfolio shares, the Portfolio's net asset value will fluctuate. There can be
no assurance that the Portfolio's hedging transactions will be effective. Also,
the Portfolio may not necessarily be engaging in hedging activities when
movements in any particular equity, debt or currency market occur.
FUTURES CONTRACTS
The Portfolio may enter into futures contracts for the purposes of
hedging, remaining fully invested and reducing transaction costs. Futures
contracts provide for the future sale by one party and purchase by another party
of a specified amount of a specific security at a specified future time and at a
specified price. Futures contracts which are standardized as to maturity date
and underlying financial instrument are traded on national futures exchanges.
Futures exchanges and trading are regulated under the Commodity Exchange Act by
the Commodity Futures Trading Commission ("CFTC"), a U.S. Government agency.
Although futures contracts by their terms call for actual delivery or
acceptance of the underlying securities, in most cases the contracts are closed
out before the settlement date without the making or taking of delivery. Closing
out an open futures position is done by taking an opposite position ("buying" a
contract which has previously been "sold" or "selling" a contract previously
"purchased") in an identical contract to terminate the position. Brokerage
commissions are incurred when a futures contract is bought or sold.
Futures contracts on securities indices or other indices do not
require the physical delivery of securities, but merely provide for profits and
losses resulting from changes in the market value of a contract to be credited
or debited at the close of each trading day to the respective accounts of the
parties to the contract. On the contract's expiration date a final cash
settlement occurs and the futures position is simply closed out. Changes in the
market value of a particular futures contract reflect changes in the level of
the index on which the futures contract is based.
Futures traders are required to make a good faith margin deposit in
cash or acceptable securities with a broker or custodian to initiate and
maintain open positions in futures contracts. A margin deposit is intended to
assure completion of the contract (delivery or acceptance of the underlying
security) if it is not terminated prior to the specified delivery date. Minimal
initial margin requirements are established by the futures exchange and may be
changed. Brokers may establish deposit requirements which are higher than the
exchange minimums. Generally margin deposits are structured as percentages
(e.g., 5%) of the market value of the contracts being traded. After a futures
contract position is opened, the value of the contract is marked to market
daily. If the futures contract price changes to the extent that the margin on
deposit does not satisfy margin requirements, payment of additional "variation"
margin will be required. Conversely, changes in the contract value may reduce
the required margin, resulting in a repayment of excess margin to the contract
holder. Variation margin payments are made to and from the futures broker for as
long as the contract remains open. The Portfolio expects to earn interest income
on its margin deposits.
Traders in futures contracts may be broadly classified as either
"hedgers" or "speculators." Hedgers use the futures markets primarily to offset
unfavorable changes in the value of securities otherwise held for investment
purposes or expected to be acquired by them. Speculators are less inclined to
own the securities underlying the futures contracts which they trade and use
futures contracts with the expectation of realizing profits from a fluctuation
in interest rates. The Portfolio intends to use futures contracts only for
hedging purposes.
Regulations of the CFTC applicable to the Fund require that all of its
futures transactions constitute bona fide hedging transactions or that the
Fund's commodity futures and option positions be for other purposes, only to the
extent that the aggregate initial margins and premiums required to establish
such non-hedging positions do not exceed five percent of the liquidation value
of the Portfolio. The Portfolio will only sell futures contracts to protect
securities it owns against price declines or purchase contracts to protect
against an increase in the price of securities it intends to purchase. As
evidence of this hedging interest, the Portfolio expects that approximately 75%
of its futures contracts purchases will be "completed," that is, equivalent
amounts
3
<PAGE>
of related securities will have been purchased or will be purchased by the
Portfolio on the settlement date of the futures contracts.
Although techniques other than the sale and purchase of futures
contracts could be used to control the Portfolio's exposure to market
fluctuations, the use of futures contracts may be a more effective means of
hedging this exposure. While the Portfolio will incur commission expenses in
both opening and closing out futures positions, these costs are lower than
transaction costs incurred in the purchase and sale of the underlying
securities.
RESTRICTIONS ON THE USE OF FUTURES CONTRACTS
The Portfolio will not enter into futures contract transactions to the
extent that, immediately thereafter, the sum of its initial margin deposits on
open contracts exceeds 5% of the market value of its total assets. In addition,
the Portfolio will not enter into futures contracts to the extent that its
outstanding obligations to purchase securities under these contracts would
exceed 20% of its total assets.
RISK FACTORS IN FUTURES TRANSACTIONS
Positions in futures contracts may be closed out only on an exchange
which provides a secondary market for such futures. The Portfolio will minimize
the risk that it will be unable to close out a futures position by only entering
into futures which are traded on national futures exchanges and for which there
appears to be a liquid secondary market. However, there can be no assurance
that a liquid secondary market will exist for any particular futures contract at
any specific time. Thus, it may not be possible to close a futures position. In
the event of adverse price movements, the Portfolio would continue to be
required to make daily cash payments to maintain its required margin. In such
situations, if the Portfolio has insufficient cash, it may have to sell
Portfolio securities to meet daily margin requirements at a time when it may be
disadvantageous to do so. In addition, the Portfolio may be required to make
delivery of the instruments underlying futures contracts it holds. The inability
to close futures positions also could have an adverse impact on the Portfolio's
ability to effectively hedge.
The risk of loss in trading futures contracts in some strategies can
be substantial due both to the low margin deposits required and the extremely
high degree of leverage involved in futures pricing. As a result, a relatively
small price movement in a futures contract may result in immediate and
substantial loss (as well as gain) to the investor. For example, if at the time
of purchase, 10% of the value of the futures contract is deposited as margin, a
subsequent 10% decrease in the value of the futures contract would result in a
total loss of the margin deposit, before any deduction for the transaction
costs, if the account were then closed out. A 15% decrease would result in a
loss equal to 150% of the original margin deposit if the contract were closed
out. Thus, a purchase or sale of a futures contract may result in losses in
excess of the amount invested in the contract. However, because the futures
strategies of the Portfolio are engaged in only for hedging purposes, the
Adviser does not believe that the Portfolio is subject to the risks of loss
frequently associated with futures transactions. The Portfolio would presumably
have sustained comparable losses if, instead of the futures contract, it had
invested in the underlying financial instrument and sold it after the decline.
Utilization of futures transactions by the Portfolio does involve the
risk of imperfect or no correlation where the securities underlying the futures
contracts have different maturities than the Portfolio securities being hedged.
It is also possible that the Portfolio could both lose money on futures
contracts and also experience a decline in value of portfolio securities. There
is also the risk of loss by the Portfolio of margin deposits in the event of
bankruptcy of a broker with whom the Portfolio has an open position in a futures
contract or related option.
Most futures exchanges limit the amount of fluctuation permitted in
futures contract prices during a single trading day. The daily limit establishes
the maximum amount that the price of a futures contract may vary either up or
down from the previous day's settlement price at the end of a trading session.
Once the daily limit has been reached in a particular type of contract, no
trades may be made on that day at a price beyond that limit. The daily
4
<PAGE>
limit governs only price movement during a particular trading day and,
therefore, does not limit potential losses because the limit may prevent the
liquidation of unfavorable positions. Futures contract prices have occasionally
moved to the daily limit for several consecutive trading days with little or no
trading thereby preventing prompt liquidation of futures positions and
subjecting some futures traders to substantial losses.
OPTIONS
The Portfolio may purchase and sell put and call options on securities
and futures contracts for hedging purposes. Investments in options involve some
of the same considerations that are involved in connection with investments in
futures contracts (e.g., the existence of a liquid secondary market). In
addition, the purchase of an option also entails the risk that changes in the
value of the underlying security or contract will not be fully reflected in the
value of the option purchased. Depending on the pricing of the option compared
to either the futures contract on which it is based or the price of the
securities being hedged, an option may or may not be less risky than ownership
of the futures contract or such securities.
For example, there are significant differences between the securities,
futures and options markets that could result in an imperfect correlation
between these markets, causing a given transaction not to achieve its objective.
A decision as to whether, when, and how to use options involves the exercise of
skill and judgment by the Adviser, and even a well-conceived transaction may be
unsuccessful because of market behavior or unexpected events.
WRITING COVERED CALL OPTIONS
The principal reason for writing call options is to attempt to
realize, through the receipt of premiums, a greater return than would be
realized on securities alone. By writing covered call options, the Portfolio
gives up the opportunity, while the option is in effect, to profit from any
price increase in the underlying security above the option exercise price. In
addition, the Portfolio's ability to sell the underlying security will be
limited while the option is in effect unless the Portfolio effects a closing
purchase transaction. A closing purchase transaction cancels out the Portfolio's
position as the writer of an option by means of offsetting purchase of an
identical option prior to the expiration of the option it has written. Covered
call options serve as a partial hedge against the price of the underlying
security declining. The Portfolio writes only covered options, which means that
so long as the Portfolio is obligated as the writer of the option it will,
through its custodian, have deposited and maintained cash or liquid securities
denominated in U.S. dollars with a value equal to or greater than the exercise
price of the underlying securities.
PURCHASING OPTIONS
The amount of any appreciation in the value of the underlying security
subject to a put will be partially offset by the amount of the premium paid for
the put option and any related transaction costs. Prior to its expiration, a put
option may be sold in a closing sale transaction and profit or loss from a sale
will depend on whether the amount received is more or less than the premium paid
for the put option plus the related transaction costs. A closing sale
transaction cancels out the Portfolio's position as purchaser of an option by
means of an offsetting sale of an identical option prior to the expiration of
the option it has purchased. In certain circumstances, the Portfolio may
purchase call options on securities held in its investment portfolio on which it
has written call options or on securities which it intends to purchase.
PORTFOLIO TURNOVER
The portfolio turnover rate described in the Prospectus is calculated
by dividing the lesser of purchases or sales of portfolio securities for the
year by the monthly average of the value of the portfolio securities. The
calculation excludes all securities, including options, whose maturities at the
time of acquisition were one year or less. Portfolio turnover may vary greatly
from year to year as well as within a particular year, and may also be affected
by cash requirements for redemptions of shares. See "Financial Highlights" in
the Prospectus for the historical portfolio turnover rates with respect to the
Portfolio.
5
<PAGE>
PURCHASE AND REDEMPTION OF SHARES
Shares of the Portfolio may be purchased without a sales commission at
the net asset value per share next determined after an order is received in
proper form by the Fund, and payment is received by the Fund or its designated
Service Agent. The minimum initial investment required for the Portfolio is
$2,500, with certain exceptions as may be permitted from time to time by the
officers of the Fund. Other investment minimums are: initial IRA investment,
$500; initial spousal IRA investment, $250; and additional investment for all
accounts, $100. An order received in proper form prior to the close of regular
trading on the New York Stock Exchange ("Exchange") (generally 4:00 p.m. Eastern
Time) will be executed at the price computed on the date of receipt; and an
order received not in proper form or after the close of the Exchange will be
executed at the price computed on the next day the Exchange is open after proper
receipt. The exchange will be closed on the following days: New Year's Day, Dr.
Martin Luther King, Jr. Day; Presidents' Day; Good Friday; Memorial Day;
Independence Day; Labor Day; Thanksgiving Day and Christmas Day.
The Portfolio reserves the right in its sole discretion (1) to suspend
the offering of its shares, (2) to reject purchase orders when in the judgment
of management such rejection is in the best interests of the Fund, and (3) to
reduce or waive the minimum for initial and subsequent investment for certain
fiduciary accounts such as employee benefit plans or under circumstances where
certain economies can be achieved in sales of the Portfolio's shares.
The Portfolio may suspend redemption privileges or postpone the date
of payment (1) during any period that either the Exchange and custodian bank are
closed or trading on the Exchange is restricted as determined by the SEC, (2)
during any period when an emergency exists as defined by the rules of the SEC as
a result of which it is not reasonably practicable for the Portfolio to dispose
of securities owned by it or to fairly determine the value of its assets, and
(3) for such other periods as the SEC may permit. The Fund has made an election
with the SEC to pay in cash all redemptions requested by any shareholder of
record limited in amount during any 90-day period to the lesser of $250,000 or
1% of the net assets of the Fund at the beginning of such period. Such
commitment is irrevocable without the prior approval of the SEC. Redemptions in
excess of the above limits may be paid, in whole or in part, in investment
securities or in cash as the Board of Trustees may deem advisable; however,
payment will be made wholly in cash unless the Trustees believe that economic or
market conditions exist which would make such a practice detrimental to the best
interests of the Portfolio. If redemptions are paid in investment securities,
such securities will be valued as set forth in the prospectus under "VALUATION
OF SHARES," and a redeeming shareholder would normally incur brokerage expenses
if he converted those securities to cash.
No charge is made by the Portfolio for redemptions. Any redemption may
be more or less than the shareholder's initial cost depending on the market
value of the securities held by the Portfolio.
SIGNATURE GUARANTEES
To protect your account, the Fund and Chase Global Funds Services
Company ("CGFSC") from fraud, signature guarantees are required for certain
redemptions. The purpose of signature guarantees is to verify the identity of
the person who has authorized a redemption from your account. Signature
guarantees are required for (1) all redemptions when the proceeds are to be paid
to someone other than the registered owner(s) and/or registered address, or (2)
share transfer requests.
Signatures must be guaranteed by an "eligible guarantor institution"
as defined in Rule 17ad-15 under the Securities Exchange Act of 1934. Eligible
guarantor institutions include banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies and
savings associations. A complete definition of eligible guarantor institutions
is available from the fund's transfer agent. Broker-dealers guaranteeing
signatures must be a member of a clearing corporation or maintain net capital of
at least $100,000. Credit unions must be authorized to issue signature
guarantees. Signature guarantees will be accepted from any eligible guarantor
institution which participates in a signature guarantee program.
6
<PAGE>
The signature guarantee must appear either: (1) on the written request
for redemption; (2) on a separate instrument for assignment ("stock power")
which should specify the total number of shares to be redeemed; or (3) on all
stock certificates tendered for redemption and, if shares held by the Fund are
also being redeemed, on the letter or stock power.
VALUATION OF SHARES
Equity securities listed on a securities exchange for which market
quotations are readily available are valued at the last quoted sale price of the
day. Price information on listed securities is taken from the exchange where
the security is primarily traded. Unlisted equity securities and listed
securities not traded on the valuation date for which market quotations are
readily available are valued neither exceeding the current asked prices nor less
than the current bid prices. Quotations of foreign securities in a foreign
currency are converted to U.S. dollar equivalents. The converted value is based
upon the bid price of the foreign currency against U.S. dollars as quoted by any
major bank or broker.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Bonds and other fixed income securities may be valued on the
basis of prices provided by a pricing service when such prices are believed to
reflect the fair market value of such securities.
Securities purchased with remaining maturities of 60 days or less are
valued at amortized cost, using methods approved by the Board of Trustees.
The value of other assets and securities for which no quotations are
readily available (including restricted securities) is determined in good faith
at fair value using methods approved by the Fund's Board of Trustees.
SHAREHOLDER SERVICES
The following supplements the information set forth under "Shareholder
Services" in the Prospectus.
EXCHANGE PRIVILEGE
Service Class Shares of the Portfolio may be exchanged for Service
Class Shares of any other UAM Funds or UAM Funds, Inc. Portfolio. Exchange
requests should be made by calling the Fund (1-800-638-7983) or by writing to
UAM Funds, UAM Funds Service Center, c/o Chase Global Funds Services Company,
P.O. Box 2798, Boston, MA 02208-2798. The exchange privilege is only available
with respect to Portfolios that are qualified for sale in the shareholder's
state of residence.
Any such exchange will be based on the respective net asset values of
the shares involved. There is no sales commission or charge of any kind. Before
making an exchange into a Portfolio, a shareholder should read its Prospectus
and consider the investment objective of the Portfolio to be purchased. You may
obtain a Prospectus for the Portfolio(s) you are interested in by calling the
UAM Funds Service Center at 1-800-638-7983.
Telephone exchanges will be accepted only if the certificates for the
shares to be exchanged have not been issued to the shareholder, and if the
registration of the two accounts will be identical. Requests for exchanges
received prior to the close of regular trading of the Exchange (generally 4:00
p.m. Eastern Time) will be processed as of the close of business on the same
day. Requests received after the close of regular trading on the Exchange will
be processed on the next business day. Neither the Fund nor CGFSC will be
responsible for the authenticity of the exchange instructions received by
telephone. Exchanges may also be subject
7
<PAGE>
to limitations as to amounts or frequency and to other restrictions established
by the Board of Trustees to assure that such exchanges do not disadvantage the
Fund and its shareholders.
For federal income tax purposes an exchange between Portfolios is a
taxable event, and, accordingly, a capital gain or loss may be realized. In a
revenue ruling relating to circumstances similar to the Fund's, an exchange
between series of a Fund was also deemed to be a taxable event. It is likely,
therefore, that a capital gain or loss would be realized on an exchange between
Portfolios; you may want to consult your tax adviser for further information in
this regard. The exchange privilege may be modified or terminated at any time.
TRANSFER OF SHARES
Shareholders may transfer shares of the Portfolio to another person by
making a written request to the Fund. The request should clearly identify the
account and number of shares to be transferred, and include the signature of all
registered owners and all stock certificates, if any, which are subject to the
transfer. The signature on the letter of request, the stock certificate or any
stock power must be guaranteed in the same manner as described under "Purchase
and Redemption of Shares." As in the case of redemptions, the written request
must be received in good order before any transfer can be made.
INVESTMENT LIMITATIONS
The following limitations supplement those set forth in the Prospectus
of the Portfolio. A Portfolio's fundamental investment limitations cannot be
changed without approval by a "majority of the outstanding shares" (as defined
in the 1940 Act) of the Portfolio. Except for the numbered investment
limitations noted as fundamental below, however, the limitations described below
are not fundamental, and may be changed without the consent of shareholders.
Whenever an investment limitation sets forth a percentage limitation on
investment or utilization of assets, such limitation shall be determined
immediately after and as a result of the Portfolio's acquisition of such
security or other asset. Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered when determining whether the investment complies with the Portfolio's
investment limitations.
As a matter of fundamental policy, the Portfolio will not:
(1) invest in physical commodities or contracts on physical commodities;
(2) purchase or sell real estate or real estate limited partnerships,
although it may purchase and sell securities of companies which deal
in real estate and may purchase and sell securities which are secured
by interests in real estate;
(3) make loans except (i) by purchasing debt securities in accordance with
its investment objectives and (ii) by lending its portfolio securities
to banks, brokers, dealers and other financial institutions so long as
such loans are not inconsistent with the 1940 Act, or the rules and
regulations or interpretations of the SEC thereunder;
(4) underwrite the securities of other issuers; and
(5) issue senior securities, as defined in the 1940 Act, except that this
restriction shall not be deemed to prohibit the Portfolio from (i)
making any permitted borrowings, mortgages or pledges, or (ii)
entering into options, futures or repurchase transactions;
As a matter of non-fundamental policy, the Portfolio will not:
8
<PAGE>
(a) invest in stock, bond or interest rate futures and/or options on
futures unless (i) not more than 5% of the Portfolio's assets are
required as deposit to secure obligations under such futures
and/or options on futures contracts provided, however, that in
the case of an option that is in-the-money at the time of
purchase, the in-the-money amount may be excluded in computing
such 5% and (ii) not more than 20% of the Portfolio's assets are
invested in futures and options
(b) purchase on margin or sell short except as specified in (5)
above;
(c) invest more than an aggregate of 15% of the net assets of the
Portfolio, determined at the time of investment, in securities
subject to legal or contractual restrictions on resale or
securities for which there are no readily available markets; and
(d) invest for the purpose of exercising control over management of
any company.
MANAGEMENT OF THE FUND
TRUSTEES AND OFFICERS
The Officers of the Fund manage its day-to-day operations and are
responsible to the Fund's Board of Trustees. The Trustees set broad policies for
the Fund and elect its Officers. The following is a list of the Trustees and
Officers of the Fund, their addresses and dates of birth, and a brief statement
of their present positions and principal occupations during the past five years.
John T. Bennett, Jr. (1/26/29), Trustee; College Road--RFD 3, Meredith, NH
03253; President of Squam Investment Management Company, Inc. and Great Island
Investment Company, Inc.; President of Bennett Management Company from 1988 to
1993.
Nancy J. Dunn (8/14/51), Trustee; 10 Garden Street, Cambridge, MA 02138; Vice
President for Finance and Administration and Treasurer of Radcliffe College
since 1991.
Philip D. English (8/5/48), Trustee; 16 West Madison Street, Baltimore, MD
21201; President and Chief Executive Officer of Broventure Company, Inc.;
Chairman of the Board of Chektec Corporation and Cyber Scientific, Inc.
William A. Humenuk (4/21/42), Trustee; 100 King Street West, P.O. Box 2440, LCD-
1, Hamilton Ontario, Canada L8N-456; Executive Vice President and Chief
Administrative Officer of Philip Services Corp.; Director, Hofler Corp.;
Formerly, a Partner in the Philadelphia office of the law firm Dechert Price &
Rhoads.
Norton H. Reamer* (3/21/35), Trustee; One International Place, Boston, MA 02110;
President and Chairman of the Fund; President, Chief Executive Officer and a
Director of United Asset Management Corporation; Director, Partner or Trustee of
each of the Investment Companies of the Eaton Vance Group of Mutual Funds.
9
<PAGE>
Peter M. Whitman, Jr.* (7/1/43), Trustee; One Financial Center, Boston, MA
02111; President and Chief Investment Officer of Dewey Square Investors
Corporation ("DSI") since 1988; Director and Chief Executive Officer of H. T.
Investors, Inc., formerly a subsidiary of DSI.
William H. Park (9/19/47), Vice President; One International Place, Boston, MA
02110; Executive Vice President and Chief Financial Officer of United Asset
Management Corporation.
Gary L. French (7/4/51), Treasurer; 211 Congress Street, Boston, MA 02110;
President of UAM Fund Services, Inc. and UAM Fund Distributors, Inc.; formerly
Vice President of Operations, Development and Control of Fidelity Investment in
1995; Treasurer of the Fidelity Group of Mutual Funds from 1991 to 1995.
Michael E. DeFao (2/28/68), Secretary; 211 Congress Street, Boston, MA 02110;
Vice President and General Counsel of UAM Fund Services, Inc. and UAM Fund
Distributors, Inc.; Associate Attorney of Ropes & Gray (a law firm) from 1993 to
1995.
Robert R. Flaherty (9/18/63), Assistant Treasurer; 211 Congress Street, Boston,
MA 02110; Vice President of UAM Fund Services, Inc.; formerly Manager of Fund
Administration and Compliance of Chase Global Fund Services Company from 1995 to
1996; Deloitte & Touche LLP from 1985 to 1995, Senior Manager.
Michelle Azrialy (4/12/69), Assistant Secretary; 73 Tremont Street, Boston, MA
02108; Assistant Treasurer of Chase Global Funds Services Company since 1996.
Senior Public Accountant with Price Waterhouse LLP from 1991 to 1994.
Gordon M. Shone (7/30/56), Assistant Treasurer; 73 Tremont Street, Boston, MA
02108; Vice President of Fund Administration and Compliance of Chase Global
Funds Services Company; formerly Senior Audit Manager of Coopers & Lybrand LLP
(1983-1996).
*Messrs. Reamer and Whitman are deemed to be "interested persons" of the Fund as
that term is defined in the 1940 Act.
REMUNERATION OF TRUSTEES AND OFFICERS
The Fund pays each Trustee, who is not also an officer or affiliated
person, a $150 quarterly retainer fee per active Portfolio which currently
amounts to $1,350 per quarter. In addition, each unaffiliated Trustee receives a
$2,000 meeting fee which is aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Fund and UAM Funds, Inc. and
reimbursement for travel and other expenses incurred while attending Board
meetings. Trustees who are also officers or affiliated persons receive no
remuneration for their service as Trustees. The Fund's officers and employees
are paid by either the Adviser, United Asset Management Corporation ("UAM"), or
the Administrator and receive no compensation from the Fund. As of June 15,
1998, the Trustees and officers of the Fund owned less than 1% of the Fund's
outstanding shares.
The following table shows aggregate compensation paid to each of the
Fund's Trustees by the Fund and total compensation paid by the Funds and UAM
Funds, Inc. (collectively the "Fund Complex") in the fiscal year ended April 30,
1998.
COMPENSATION TABLE
<TABLE>
<CAPTION>
Pension or
Retirement Estimated Total Compensation
Benefits Annual from Registrant
Aggregate Accrued as Benefits Upon and
Name of Person, Compensation Part of Retirement Fund Complex
Position From Registrant Fund Expenses --------------- ------------------
- ------------------------------ --------------- ---------------
<S> <C> <C> <C> <C>
</TABLE>
10
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
John T. Bennett, Jr.
Trustee..................... $6,149 0 0 $33,500
Philip D. English
Trustee..................... $6,149 0 0 $33,500
William A.Humenuk
Trustee..................... $6,149 0 0 $33,500
Nancy J. Dunn
Trustee..................... $4,668 0 0 $25,200
Peter M. Whitman, Jr.
Trustee..................... $ 0 0 0 $ 0
Norton H. Reamer
Trustee..................... $ 0 0 0 $ 0
</TABLE>
PRINCIPAL HOLDERS OF SECURITIES
As of June 15, 1998, the following persons or organizations held of
record or beneficially 5% or more of the shares of the Portfolio:
T.J. Core Equity Portfolio Institutional Class Shares: Wilmington
Trust Co., Trustee, FBO Allied Waste 401K Plan, c/o Mutual Funds UAM, 1100 North
Market Street, Wilmington, DE, 34.4%; UMBSC & Co., FBO Lillick & Charles TJ
Core, c/o Trust Department, P.O. Box 419260, Kansas City, MO, 15.0%; Fleet
National Bank, Trustee, FBO Austin Diagnostic Clinic 401K PS, P.O. Box 92800,
Rochester, NY, 13.2%*; Hartnat & Co., FBO Catholic Healthcare West Sisters of
Mercy, P.O. Box 92800, Rochester, NY, 9.3%*; and Wilmington Trust Co., Trustee,
FBO Catholic Healthcare West Medical Foundation Money Purchase Pension Plan, c/o
Mutual Funds, 1100 North Market Street, Wilmington, DE, 5.5%*.
The person(s) or organization(s) listed above as owning 25% or more of
the outstanding shares of the Portfolio may be presumed to "control" (as that
term is defined in the 1940 Act) such Portfolio. As a result, those persons or
organizations could have the ability to vote a majority of the shares of the
Portfolio on any matter requiring the approval of shareholders of such
Portfolio.
_______
* Denotes shares held by a trustee or other fiduciary for which beneficial
ownership is disclaimed or presumed disclaimed.
11
<PAGE>
INVESTMENT ADVISER
INVESTMENT PHILOSOPHY
Tom Johnson's investment philosophy is a conservative one which
stresses adequate diversification, risk reduction, and consistency of returns.
The firm maintains strong disciplines and emphasizes long-term results. The
firm's initial goal is preservation of capital; thus, high quality issues are
emphasized. Secondary goals include income and capital appreciation. Thorough
fundamental economic, industry, and company analyses provide the framework
within which all investment alternatives are evaluated.
REPRESENTATIVE INSTITUTIONAL CLIENTS
As of the date of this Statement of Additional Information, the
Adviser's representative institutional clients included: LL Bean, Oklahoma
Teachers' Retirement System, Presbyterian Health Foundation, Service Corporation
International and University of Texas Ex-Students' Association.
In compiling this client list, the Adviser used objective criteria
such as account size, geographic location and client classification. The
Adviser did not use any performance-based criteria. It is not known whether
these clients approve or disapprove of the Adviser or the advisory services
provided.
CONTROL OF ADVISER
The Adviser is a wholly-owned subsidiary of UAM, a holding company
incorporated in Delaware in December 1980 for the purpose of acquiring and
owning firms engaged primarily in institutional investment management. Since its
first acquisition in August 1983, UAM has acquired or organized over 45 such
wholly-owned affiliated firms (the "UAM Affiliated Firms"). UAM believes that
permitting UAM Affiliated Firms to retain control over their investment advisory
decisions is necessary to allow them to continue to provide investment
management services that are intended to meet the particular needs of their
respective clients.
Accordingly, after acquisition by UAM, UAM Affiliated Firms continue
to operate under their own firm name, with their own leadership and individual
investment philosophy and approach. Each UAM Affiliated Firm manages its own
business independently on a day-to-day basis. Investment strategies employed and
securities selected by UAM Affiliated Firms are separately chosen by each of
them. Several UAM Affiliated Firms also act as investment advisers to separate
series or Portfolios of UAM Funds, Inc., a registered investment company.
SERVICES PERFORMED BY ADVISER
Pursuant to an Investment Advisory Agreement ("Agreement") between the
Fund and the Adviser, the Adviser has agreed to manage the investment and
reinvestment of the Portfolio's assets, to continuously review, supervise and
administer the Portfolio's investment program, and to determine in its
discretion the securities to be purchased or sold and the portion of the
Portfolio's assets to be held uninvested.
In the absence of (i) willful misfeasance, bad faith or gross
negligence on the part of the Adviser in the performance of its obligations and
duties under the Agreement, (ii) reckless disregard by the Adviser of its
obligations and duties under the Agreement, or (iii) a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services, the Adviser shall not be subject to any liability whatsoever to the
Fund, or to any shareholder of the Fund, for any error of judgment, mistake of
law or any other act or omission in the course of, or connected with, rendering
services under the Agreement.
Unless sooner terminated, the Agreement shall continue for periods of
one year so long as such continuance is specifically approved at least annually
(a) by the vote of a majority of those members of the Board of Trustees of the
Fund who are not parties to the Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval, (b) by the Board of Trustees of the Fund, or (c) by vote of a majority
of the outstanding voting securities of the Portfolio. The Agreement
12
<PAGE>
may be terminated at any time by the Portfolio, without the payment of any
penalty, by vote of a majority of the entire Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Portfolio on 60
days written notice to the Adviser. The Agreement may be terminated by the
Adviser at any time, without the payment of any penalty, upon 90 days written
notice to the Fund. The Agreement will automatically and immediately terminate
in the event of its assignment.
ADVISORY FEES
As compensation for services rendered by the Adviser under the
Agreement, the Portfolio pays the Adviser an annual fee, in monthly
installments, calculated by applying the following annual percentage rates to
the Portfolio's average daily net assets for the month:
Rate
-----
TJ Core Equity Portfolio................ 0.75%
From September 28, 1995 (date of commencement) to April 30, 1996, and
for the fiscal years ended April 30, 1997 and April 30, 1998, the TJ Core Equity
Portfolio paid no advisory fees. During these periods, the Adviser voluntarily
waived advisory fees of $4,000, $14,372 and $63,097, respectively. Until January
1, 2000, the Adviser has voluntarily agreed to waive all or a portion of its
advisory fees and to assume operating expenses otherwise payable by the
Portfolio, if necessary, in order to keep the Portfolio's total annual operating
expenses from exceeding 1.25% of average daily net assets.
SERVICE AND DISTRIBUTION PLANS
As stated in the Prospectus, the "Distributor" may enter into
agreements with broker-dealers and other financial institutions ("Service
Agents"), pursuant to which they will provide administrative support services to
Service Class shareholders who are their customers ("Customers") in
consideration of the Fund's payment of 0.25% (on an annualized basis) of the
average daily net asset value ("NAV") of the Service Class Shares held by the
Service Agent for the benefit of its Customers. Such services include:
(a) acting as the sole shareholder of record and nominee for
beneficial owners;
(b) maintaining account records for such beneficial owners of the
Fund's shares;
(c) opening and closing accounts;
(d) answering questions and handling correspondence from shareholders
about their accounts;
(e) processing shareholder orders to purchase, redeem and exchange
shares;
(f) handling the transmission of funds representing the purchase price
or redemption proceeds;
(g) issuing confirmations for transactions in the Fund's shares by
shareholders;
(h) distributing current copies of prospectuses, statements of
additional information and shareholder reports;
(i) assisting customers in completing application forms, selecting
dividend and other account options and opening any necessary
custody accounts;
(j) providing account maintenance and accounting support for all
transactions; and
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<PAGE>
(k) performing such additional shareholder services as may be agreed
upon by the Fund and the Service Agent, provided that any such
additional shareholder services must constitute a permissible non-
banking activity in accordance with the then current regulations
of, and interpretations thereof by, the Board of Governors of the
Federal Reserve System, if applicable.
Each agreement with a Service Agent is governed by a Shareholder
Service Plan (the "Service Plan") that has been adopted by the Fund's Board of
Trustees. Pursuant to the Service Plan, the Board of Trustees reviews, at least
quarterly, a written report of the amounts expended under each agreement with
Service Agents and the purposes for which the expenditures were made. In
addition, arrangements with Service Agents must be approved annually by a
majority of the Fund's Trustees, including a majority of the Trustees who are
not "interested persons" of the Fund as defined in the 1940 Act and have no
direct or indirect financial interest in such arrangements.
The Board of Trustees has approved the arrangements with Service
Agents based on information provided by the Fund's service contractors that
there is a reasonable likelihood that the arrangements will benefit the Fund and
its shareholders by affording the Fund greater flexibility in connection with
the servicing of the accounts of the beneficial owners of its shares in an
efficient manner. Any material amendment to the Fund's arrangements with Service
Agents must be approved by a majority of the Fund's Board of Trustees (including
a majority of the disinterested Trustees). So long as the arrangements with
Service Agents are in effect, the selection and nomination of the members of the
Fund's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of the Fund will be committed to the discretion of such non-interested
Trustees.
The Service Plan may be terminated at any time by vote of a majority of the
Trustees of the Fund who are not "interested persons" of the Fund and who have
no direct or indirect financial interest in the operation of the Service Plan or
any agreements related to the Service Plan or, at the discretion of the Board of
Trustees of the Fund, by vote of a majority of the outstanding voting securities
of the Fund.
Pursuant to Rule 12b-1 under the 1940 Act, the Fund has adopted a
Distribution Plan for the Service Class Shares of the Fund (the "Distribution
Plan"). The Distribution Plan permits the Fund to pay for certain distribution,
promotional and related expenses involved in the marketing of only the Service
Class Shares.
The Distribution Plan permits the Service Class Shares, pursuant to
the Distribution Agreement, to pay a monthly fee to the Distributor for its
services and expenses in distributing and promoting sales of the Service Class
Shares. These expenses include, among other things, advertising the availability
of services and products; designing materials to send to customers and
developing methods of making such materials accessible to customers; providing
information about the product needs of customers; providing facilities to
solicit Fund sales and to answer questions from prospective and existing
investors about the Fund; receiving and answering correspondence from
prospective investors, including requests for sales literature, prospectuses and
statements of additional information; displaying and making sales literature and
prospectuses available; and acting as liaison between shareholders and the Fund,
including obtaining information from the Fund and providing performance
information about the Fund. In addition, the Service Class Shares may make
payments directly to other unaffiliated parties who either aid in the
distribution of their shares or provide services to the Class.
The maximum annual aggregate fee payable by the Fund under the Service
and Distribution Plans (the "Plans"), is 0.75% of the Service Class Shares'
average daily net assets for the year. The Fund's Board of Trustees may reduce
this amount at any time. Although the maximum fee payable under the 12b-1 Plan
relating to the Service Class Shares is 0.75% of average daily net assets of
such class, the Board of Trustees has determined that the annual fee, payable on
a monthly basis, under the Plans relating to the Service Class Shares, currently
cannot exceed 0.50% of the average daily net assets represented by the Service
Class. While the current fee which will be payable under the Service Plan has
been set at 0.25%, the Plans permit a full 0.75% on all assets to be paid at any
time following appropriate Board approval.
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<PAGE>
All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid by the Service
Class Shares will be borne by such persons without any reimbursement from such
Classes. Subject to seeking best price and execution, the Fund may, from time to
time, buy or sell portfolio securities from or to firms which receive payments
under the Plans. From time to time, the Distributor may pay additional amounts
from its own resources to dealers for aid in distribution or for aid in
providing administrative services to shareholders.
The Plans, the Distribution Agreement and the form of dealer's and
services agreements have all been approved by the Board of Trustees of the Fund,
including a majority of the Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund and who have no direct or indirect
financial interest in the Plans or any related agreements, by vote cast in
person at a meeting duly called for the purpose of voting on the Plans and such
Agreements. Continuation of the Plans, the Distribution Agreement and the
related agreements must be approved annually by the Board of Trustees in the
same manner, as specified above.
Each year the Trustees must determine whether continuation of the
Plans is in the best interest of the shareholders of Service Class Shares and
that there is a reasonable likelihood of the Plans providing a benefit to the
Class. The Plans, the Distribution Agreement and the related agreements with any
broker-dealer or others relating to the Class may be terminated at any time
without penalty by a majority of those Trustees who are not "interested persons"
or by a majority vote of the outstanding voting securities of the Class. Any
amendment materially increasing the maximum percentage payable under the Plans
must likewise be approved by a majority vote of the relevant Class' outstanding
voting securities, as well as by a majority vote of those Trustees who are not
"interested persons." Also, any other material amendment to the Plans must be
approved by a majority vote of the Trustees including a majority of the Trustees
of the Fund having no interest in the Plans. In addition, in order for the Plans
to remain effective, the selection and nomination of Trustees who are not
"interested persons" of the Fund must be effected by the Trustees who themselves
are not "interested persons" and who have no direct or indirect financial
interest in the Plans. Persons authorized to make payments under the Plans must
provide written reports at least quarterly to the Board of Trustees for their
review. The National Association of Securities Dealers Regulation, Inc. has
adopted amendments to its Conduct Rules relating to investment company sales
charges. The Fund and the Distributor intend to operate in compliance with these
rules.
During the fiscal year ended April 30, 1998, the Portfolio's Service Class
Shares paid $18,198 for services provided pursuant to the Distribution Plan.
PORTFOLIO TRANSACTIONS
The Investment Advisory Agreement authorizes the Adviser to select the
brokers or dealers that will execute the purchases and sales of investment
securities for the Portfolio and directs the Adviser to use its best efforts to
obtain the best execution with respect to all transactions for the Portfolio.
The Adviser may, however, consistent with the interests of the Portfolio, select
brokers on the basis of the research, statistical and pricing services they
provide to the Portfolio. Information and research received from such brokers
will be in addition to, and not in lieu of, the services required to be
performed by the Adviser under the Investment Advisory Agreement. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that such
commissions are paid in compliance with the Securities Exchange Act of 1934, as
amended, and that the Adviser determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
the Adviser to the Portfolio and the Adviser's other clients.
It is not the Fund's practice to allocate brokerage or effect
principal transactions with dealers on the basis of sales of Fund shares which
may be made through broker-dealer firms. However, the Adviser may place
portfolio orders with qualified broker-dealers who refer clients to the Adviser.
During the period from September 28, 1995 to April 30, 1996, and for the fiscal
years ended April 30, 1997 and April 30, 1998, the Portfolio paid aggregate
brokerage commissions of $1,572, $3,696 and $18,284, respectively. The
difference in brokerage
15
<PAGE>
commissions paid between fiscal years April 30, 1997 and 1998, was the result of
growth in the portfolio's assets.
Some securities considered for investment by the Portfolio may also be
appropriate for other clients served by the Adviser. If purchases or sales of
securities consistent with the investment policies of the Portfolio and one or
more of these other clients served by the Adviser is considered at or about the
same time, transactions in such securities will be allocated among the Portfolio
and clients in a manner deemed fair and reasonable by the Adviser. Although
there is no specified formula for allocating such transactions, the various
allocation methods used by the Adviser, and the results of such allocations, are
subject to periodic review by the Fund's Board of Trustees.
ADMINISTRATIVE SERVICES
The Board of Trustees of the Fund approved a Fund Administration
Agreement ("Fund Administration Agreement"), effective April 15, 1996, between
UAMFSI, a wholly owned subsidiary of UAM, and the Fund. Pursuant to the terms of
the Fund Administration Agreement, UAMFSI manages, administers and conducts the
general business activities of the Fund other than those which have been
contracted to other third parties by the Fund. Additionally, UAMFSI has agreed
to provide transfer agency services to the Portfolio pursuant to the terms of
the Fund Administration Agreement.
UAMFSI has subcontracted some of these services to CGFSC, an affiliate
of The Chase Manhattan Bank, pursuant to a Mutual Funds Service Agreement
between UAMFSI and CGFSC (collectively, with the Fund Administration Agreement,
the "Agreements").
Pursuant to the terms of the Agreements, the Portfolio pays UAMFSI a
two-part monthly fee: a Portfolio-specific fee which is retained by UAMFSI and
a sub-administration fee which UAMFSI in turn pays to CGFSC. The following
Portfolio-specific fee is calculated from the aggregate net assets of the
Portfolio:
Annual Rate
-----------
TJ Core Equity Portfolio......................0.04%
CGFSC's monthly fee for its services is calculated on an annualized
basis as follows:
0.19 of 1% of the first $200 million of combined Fund net
assets;
0.11 of 1% of the next $800 million of combined Fund net assets;
0.07 of 1% of combined Fund net assets in excess of $1 billion
but less than $3 billion;
0.05 of 1% of combined Fund net assets in excess of $3 billion.
Fees are allocated among each of the Portfolios on the basis of their
relative assets and are subject to a graduated minimum fee schedule per
Portfolio, which starts at $2,000 per month and increases to $70,000 annually
after two years. If a separate class of shares is added to a Portfolio, its
minimum annual fee increases by $20,000.
Prior to April 15, 1996, CGFSC or its predecessor, Mutual Funds
Service Company, provided certain administrative services to the Fund under an
Administration Agreement between the Fund and U.S. Trust Company of New York.
16
<PAGE>
The basis of the fees paid to CGFSC for the period September 28, 1995
to April 14, 1996 was as follows: the Fund paid a monthly fee for CGFSC's
services which on an annualized basis equaled 0.20% of the first $200 million in
combined assets; plus 0.12% of the next $800 million in combined assets; plus
0.08% on assets over $1 billion but less than $3 billion; plus 0.06% on assets
over $3 billion. The fees were allocated among the Portfolios on the basis of
their relative assets and were subject to a designated minimum fee schedule per
Portfolio, which ranged from $2,000 per month upon inception of a Portfolio to
$70,000 annually after two years. For the period ended April 30, 1996,
administrative services fees paid to CGFSC by the TJ Core Equity Portfolio
totaled $15,232. For the period April 15, 1996 to April 30, 1996, UAMFSI earned
$1,768 from the TJ Core Equity Portfolio as Administrator. For the fiscal years
ended April 30, 1997 and April 30, 1998, administrative fees paid by the
Portfolio to UAMFSI totaled $763 and $3,366, respectively, and to CGFSC totaled
$59,928 and $72,990, respectively. The services provided by UAMFSI and CGFSC and
the basis of the current fees payable are described in the Portfolio's
Prospectus.
UAMFSI will bear all expenses in connection with the performance of
its services under the Fund Administration Agreement. Other expenses to be
incurred in the operation of the Fund will be borne by the Fund or other
parties, including taxes, interest, brokerage fees and commissions, if any,
salaries and fees of officers and members of the Board who are not officers,
directors, shareholders or employees of UAMFSI, or the Fund's investment adviser
or distributor, SEC fees and state Blue Sky fees, EDGAR filing fees, processing
services and related fees, advisory and administration fees, charges and
expenses of pricing and data services, independent public accountants and
custodians, insurance premiums including fidelity bond premiums, outside legal
expenses, costs of maintenance of corporate existence, typesetting and printing
of prospectuses for regulatory purposes and for distribution to current
shareholders of the Fund, printing and production costs of shareholders' reports
and corporate meetings, cost and expenses of Fund stationery and forms, costs of
special telephone and data lines and devices, trade association dues and
expenses, and any extraordinary expenses and other customary Fund expenses.
Unless sooner terminated as provided herein, the Fund Administration
Agreement shall continue in effect from year to year provided such continuance
is specifically approved at least annually by the Board. The Fund
Administration Agreement is terminable, without penalty, by the Board or by
UAMFSI, on not less than ninety (90) days' written notice. The Fund
Administration Agreement shall automatically terminate upon its assignment by
UAMFSI without the prior written consent of the Fund.
UAMFSI will from time to time employ or associate with such person or
persons as may be fit to assist them in the performance of the Fund
Administration Agreement. Such person or persons may be officers and employees
who are employed by both UAMFSI and the Fund. The compensation of such person
or persons for such employment shall be paid by UAMFSI and no obligation will be
incurred by or on behalf of the Fund in such respect.
Effective February 28, 1997, the Fund entered into an Account Services
Agreement (the "Services Agreement") with UAM Retirement Plan Services, Inc.
(the "Service Provider"), a wholly-owned subsidiary of UAM. Under the Services
Agreement, the Service Provider agrees to perform certain services for
participants in a self-directed, defined contribution plan, and for whom the
Service Provider provides participant recordkeeping. Pursuant to the Services
Agreement, the Service Provider is entitled to receive, after the end of each
month, a fee at the annual rate of 0.15% of the average aggregate daily net
asset value of shares of the Portfolios in the accounts for which it provides
services. During the fiscal year ended April 30, 1998, the Portfolio paid the
Service Provider $10,898, in fees pursuant to the Services Agreement, all of
which were voluntarily waived.
CUSTODIAN
The Chase Manhattan Bank, 3 Chase Metro Tech Center, Brooklyn, New
York 11245, provides for the custody of the Fund's assets pursuant to the terms
of a custodian agreement with the Fund.
INDEPENDENT ACCOUNTANTS
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<PAGE>
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110,
serves as independent accountants for the Fund.
DISTRIBUTOR
UAM Fund Distributors, Inc., a wholly-owned subsidiary of UAM, serves
as the Fund's Distributor. Shares of the Fund are offered continuously. While
the Distributor will use its best efforts to sell shares of the Fund, it is not
obligated to sell any particular amount of shares.The Distributor received no
compensation for its services from the Portfolio during the fiscal year ended
April 30, 1998.
PERFORMANCE CALCULATIONS
PERFORMANCE
The Portfolio may from time to time quote various performance figures
to illustrate past performance. Performance quotations by investment companies
are subject to rules adopted by the SEC which require the use of standardized
performance quotations or, alternatively, that every non-standardized
performance quotation furnished by the Portfolio be accompanied by certain
standardized performance information computed as required by the SEC. Average
annual compounded total return quotations used by the Portfolio are based on the
standardized methods of computing performance mandated by the SEC. An
explanation of the method used to compute or express performance follows.
TOTAL RETURN
The average annual total return of the Portfolio is determined by
finding the average annual compounded rates of return over 1, 5 and 10 year
periods that would equate an initial hypothetical $1,000 investment to its
ending redeemable value. The calculation assumes that all dividends and
distributions are reinvested when paid. The quotation assumes the amount was
completely redeemed at the end of each 1, 5 and 10 year period and the deduction
of all applicable Portfolio expenses on an annual basis.
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<PAGE>
These figures are calculated according to the following formula:
P(1 + T)n = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1, 5 or 10 year periods at
the end of the 1, 5 or 10 year periods (or fractional
portion thereof).
The average annual total returns for the Portfolio's Service Class
Shares from inception on September 28, 1995 to April 30, 1998, and for the
fiscal year ended April 30, 1998 were 25.90% and 36.05%, respectively.
COMPARISONS
To help investors better evaluate how an investment in the Portfolios
of the Fund might satisfy their investment objective, advertisements regarding
the Portfolio may discuss various measures of Portfolio performance as reported
by various financial publications. Advertisements may also compare performance
(as calculated above) to performance as reported by other investments, indices
and averages. Please see Appendix B for publications, indices and averages which
may be used.
In assessing such comparisons of performance, an investor should keep
in mind that the composition of the investments in the reported indices and
averages is not identical to the composition of investments in the Portfolio,
that the averages are generally unmanaged, and that the items included in the
calculations of such averages may not be identical to the formula used by the
Portfolio to calculate its performance. In addition, there can be no assurance
that the Portfolio will continue this performance as compared to such other
averages.
GENERAL INFORMATION
DESCRIPTION OF SHARES AND VOTING RIGHTS
The Fund was organized under the name The Regis Fund II as a Delaware
business trust on May 18, 1994. On October 31, 1995, the name of the Fund was
changed to "UAM Funds Trust." The Fund's principal executive office is located
at One International Place, 44th floor, Boston, MA 02110; however, all investor
correspondence should be addressed to the Fund at UAM Funds Service Center, c/o
Chase Global Funds Services Company, P.O. Box 2798, Boston, MA 02208-2798. The
Fund's Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest, without par value. The Trustees have
the power to designate one or more series ("Portfolios") or classes of shares of
beneficial interest without further action by shareholders.
The Board of Trustees has classified two additional classes of shares
in the Portfolio, known as Institutional Shares and Advisor Shares. As of the
date of this Statement of Additional Information, no Advisor Shares have been
offered by the Portfolio.
The shares of the Portfolio, when issued and paid for as provided for
in its Prospectus, will be fully paid and nonassessable, have no preference as
to conversion, exchange, dividends, retirement or other features and have no
preemptive rights. The shares of the Portfolio have noncumulative voting rights,
which
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<PAGE>
means that the holders of more than 50% of the shares voting for the election of
Trustees can elect 100% of the Trustees if they choose to do so. A shareholder
is entitled to one vote for each full share held (and a fractional vote for each
fractional share held), then standing in his or her name on the books of the
Fund. Institutional Class, Service Class and Advisor Class Shares each represent
an interest in the same assets of a Portfolo and are identical in all respects
except that the Service Class Shares bear certain expenses related to
shareholder servicing and the distribution of such shares, and have exclusive
voting rights with respect to matters relating to such distribution
expenditures.
In the event of liquidation of the Fund, the holders of the shares of
each Portfolio or any class thereof that has been established and designated
shall be entitled to receive, when and as declared by the Trustees, the excess
of the assets belonging to that Portfolio, or in the case of a class, belonging
to that Portfolio and allocable to that class, over the liabilities belonging to
that Portfolio or class. The assets so distributable to the holders of shares of
any particular Portfolio or class thereof shall be distributed to the holders in
proportion to the number of shares of that Portfolio or class thereof held by
them and recorded on the books of the Fund. The liquidation of any Portfolio or
class thereof may be authorized at any time by vote of a majority of the
Trustees then in office.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund's policy is to distribute substantially all of the
Portfolio's net investment income, if any, together with any net realized
capital gains in the amount and at the times that will avoid both income
(including capital gains) taxes incurred on it and the imposition of the federal
excise tax on undistributed income and capital gains. The amounts of any income
dividends or capital gains distributions cannot be predicted. See the discussion
under "Dividends, Capital Gains Distributions and Taxes" in the Prospectus.
Any dividend or distribution paid shortly after the purchase of shares
of the Portfolio by an investor may have the effect of reducing the per share
net asset value of the Portfolio by the per share amount of the dividend or
distribution. Furthermore, such dividends or distributions, although in effect a
return of capital, are subject to income taxes as set forth in the Prospectus.
As set forth in the Prospectus, unless the shareholder elects
otherwise in writing, all dividend and capital gains distributions are
automatically reinvested in additional shares of the respective Portfolio of the
Fund at net asset value (as of the business day following the record date). This
will remain in effect until the Fund is notified by the shareholder in writing
at least three days prior to the record date that either the Income Option
(income dividends in cash and capital gains distributions in additional shares
at net asset value) or the Cash Option (both income dividends and capital gains
distributions in cash) has been elected. An account statement is sent to
shareholders whenever an income dividend or capital gains distribution is
paid.
CODE OF ETHICS
The Fund has adopted a Code of Ethics which restricts to a certain
extent personal transactions by access persons of the Fund and imposes certain
disclosure and reporting obligations.
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FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Portfolio's
Annual Report to Shareholders (the "1998 Annual Report") are incorporated by
reference into this Statement of Additional Information. No other parts of the
1998 Annual Report are incorporated by reference herein. The Financial
Statements included in the 1998 Annual Report have been audited by the Fund's
independent accountants, PricewaterhouseCoopers LLP. The reports of
PricewaterhouseCoopers LLP are incorporated herein by reference. Such financial
statements have been incorporated herein in reliance upon such reports given
upon the authority of PricewaterhouseCoopers LLP as experts in accounting and
auditing. Copies of the 1998 Annual Report may be obtained free of charge by
telephoning the UAM Funds Service Center at the telephone number appearing on
the front page of this Statement of Additional Information.
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<PAGE>
APPENDIX A - DESCRIPTION OF SECURITIES AND RATINGS
I. DESCRIPTION OF CORPORATE BOND RATINGS
Moody's Investors Service Corporate Bond Ratings:
Aaa -- Bonds which are Aaa are judged to be 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.
Moody's Investors Service ("Moody's") applies numerical modifiers 1, 2 and
3 in the Aa and A rating categories. The modifier 1 indicates that the security
ranks at a higher end of the rating category, modifier 2 indicates a mid-range
rating and the modifier 3 indicates that the issue ranks at the lower end of the
rating category.
Standard & Poor's Ratings Services Corporate Bond Ratings:
AAA -- Bonds rated AAA have the highest rating assigned by Standard &
Poor's to a debt obligation and indicate an extremely strong capacity to pay
principal and interest.
AA -- Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only to 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 -- Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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
debt in this category than for debt in higher rated categories.
S&P's letter ratings may be modified by the addition of a plus or minus
sign, which is used to show relative standing within the major rating categories
except in the AAA category.
A-1
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II. DESCRIPTION OF U.S. GOVERNMENT SECURITIES
The term "U.S. Government Securities" refers to a variety of securities
which are issued or guaranteed by the United States Government, and by various
instrumentalities which have been established or sponsored by the United States
Government.
U.S. Treasury securities are backed by the "full faith and credit" of the
United States. Securities issued or guaranteed by federal agencies and U.S.
Government sponsored instrumentalities may or may not be backed by the full
faith and credit of the United States.
In the case of securities not backed by the full faith and credit of the
United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
and may not be able to assess a claim against the United States itself in the
event the agency or instrumentality does not meet its commitment. Agencies which
are backed by the full faith and credit of the United States include the Export-
Import Bank, Farmers Home Administration, Federal Financing Bank, and others.
Certain agencies and instrumentalities, such as the GNMA are, in effect, backed
by the full faith and credit of the United States through provisions in their
charters that they may make "indefinite and unlimited" drawings on the U.S.
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and FNMA, is not
guaranteed by the United States, but those institutions are protected by the
discretionary authority of the U.S. Treasury to purchase certain amounts of
their securities to assist the institution in meeting its debt obligations.
Finally, other agencies and instrumentalities, such as the Farm Credit System
and the FHLMC, are federally chartered institutions under Government
supervision, but their debt securities are backed only by the creditworthiness
of those institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities
include the Export-Import Bank of the United States, Farmers Home
Administration, Federal Housing Administration, Maritime Administration, Small
Business Administration, and the Tennessee Valley Authority.
III. DESCRIPTION OF COMMERCIAL PAPER
The Portfolio may invest in commercial paper (including variable amount
master demand notes) rated A-1 or better by Standard & Poor's ("S&P") or Prime-1
by Moody's or by S&P. Commercial paper refers to short-term, unsecured
promissory notes issued by corporations to finance short-term credit needs.
Commercial paper is usually sold on a discount basis and has a maturity at the
time of issuance not exceeding nine months. Variable amount master demand notes
are demand obligations that permit the investment of fluctuating amounts at
varying market rates of interest pursuant to arrangement between the issuer and
a commercial bank acting as agent for the payees of such notes whereby both
parties have the right to vary the amount of the outstanding indebtedness on the
notes. As variable amount master demand notes are direct lending arrangements
between a lender and a borrower, it is not generally contemplated that such
instruments will be traded, and there is no secondary market for these notes,
although they are redeemable (and thus immediately repayable by the borrower) at
face value, plus accrued interest, at any time. In connection with the
Portfolio's investment in variable amount master demand notes, the Adviser's
investment management staff will monitor, on an ongoing basis, the earning
power, cash flow and other liquidity ratios of the issuer and the borrower's
ability to pay principal and interest on demand.
Commercial paper rated A-1 by S&P has the following characteristics:
(1) liquidity ratios are adequate to meet cash requirements; (2) long-term
senior debt is rated "A" or better; (3) the issuer has access to at least two
additional channels of borrowing; (4) basic earnings and cash flow have an
upward trend with allowance made for unusual circumstances; (5) typically, the
issuer's industry is well established, and the issuer has a strong position
within the industry; and (6) the reliability and quality of management are
unquestioned. Relative strength or weakness of the above factors determine
whether the issuer's commercial paper is A-1, A-2 or A-3. The rating Prime-1 is
the highest commercial paper rating assigned by Moody's. Among the factors
considered by Moody's in assigning ratings are the following: (1) evaluation of
the management of the issuer; (2) economic evaluation of the issuer's industry
or industries and the appraisal of speculative-type risks which may be inherent
in
A-2
<PAGE>
certain areas; (3) evaluation of the issuer's products in relation to completion
and customer acceptance; (4) liquidity; (5) amount and quality of long term
debt; (6) trend of earnings over a period of ten years; (7) financial strength
of a parent company and the relationships which exist with the issuer; and (8)
recognition by the management of issuer of obligations which may be present or
may arise as a result of public interest questions and preparations to meet such
obligations.
IV. DESCRIPTION OF BANK OBLIGATIONS
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Certificates of deposit are negotiable short-term obligations of commercial
banks. Variable rate certificates of deposit are certificates of deposit on
which the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. As a result of these adjustments, the
interest rate on these obligations may increase or decrease periodically.
Frequently, dealers selling variable rate certificates of deposit to the
Portfolio will agree to repurchase such instruments, at the Portfolio's option,
at par on or near the coupon dates. The dealers' obligations to repurchase these
instruments are subject to conditions imposed by various dealers. Such
conditions typically are the continued credit standing of the issuer and the
existence of reasonably orderly market conditions. The Portfolio is also able to
sell variable rate certificates of deposit in the secondary market. Variable
rate certificates of deposit normally carry a higher interest rate than
comparable fixed rate certificates of deposit. A banker's acceptance is a time
draft drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction to finance the import, export, transfer or
storage of goods. The borrower is liable for payment as well as the bank which
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
the secondary markets prior to maturity.
V. DESCRIPTION OF FOREIGN INVESTMENTS
Investors should recognize that investing in foreign companies involves
certain special considerations which are not typically associated with investing
in U.S. companies. Since the securities of foreign companies are frequently
denominated in foreign currencies, a Portfolio may be affected favorably or
unfavorably by changes in currency rates and in exchange control regulations,
and may incur costs in connection with conversions between various currencies.
As foreign companies are not generally subject to uniform accounting,
auditing and financial reporting standards and they may have policies that are
not comparable to those of domestic companies, there may be less information
available about certain foreign companies than about domestic companies.
Securities of some foreign companies are generally less liquid and more volatile
than securities of comparable domestic companies. There is generally less
government supervision and regulation of stock exchanges, brokers and listed
companies than in the U.S. In addition, with respect to certain foreign
countries, there is the possibility of expropriation or confiscatory taxation,
political or social instability, or diplomatic developments which could affect
U.S. investments in those countries.
Although the Fund will endeavor to achieve the most favorable execution
costs in its portfolio transactions, fixed commissions on many foreign stock
exchanges are generally higher than negotiated commissions on U.S. exchanges.
Certain foreign governments levy withholding taxes on dividend and interest
income. Although in some countries a portion of these taxes are recoverable, the
non-recoverable portion of foreign withholding taxes will reduce the income
received from the companies comprising the Fund's Portfolios. However, these
foreign withholding taxes are not expected to have a significant impact.
A-3
<PAGE>
APPENDIX B - COMPARISONS
(a) Dow Jones Composite Average or its component averages -- an
unmanaged index composed of 30 blue-chip industrial corporation
stocks (Dow Jones Industrial Average), 15 utilities company
stocks and 20 transportation stocks.
(b) Standard & Poor's 500 Stock Index or its component indices -- an
unmanaged index composed of 400 industrial stocks, 40 financial
stocks, 40 utilities stocks and 20 transportation stocks.
(c) Standard & Poor's 400 Mid Cap Index - consists of 400 domestic
stocks chosen for market size, liquidity, and industry group
representation. It is also a market-value weighted index and was
the first benchwork of mid cap stock price movement.
(d) The New York Stock Exchange composite or component indices --
unmanaged indices of all industrial, utilities, transportation
and finance stocks listed on the New York Stock Exchange.
(e) Wilshire 5000 Equity Index or its component indices -- represents
the return on the market value of all common equity securities
for which daily pricing is available.
(f) Lipper -- Mutual Fund Performance Analysis and Lipper -- Fixed
Income Fund Performance Analysis -- measure total return and
average current yield for the mutual fund industry. Rank
individual mutual fund performance over specified time periods,
assuming reinvestment of all distributions, exclusive of any
applicable sales charges.
(g) Lipper Capital Appreciation Funds Index - a fund that aims at
maximum capital appreciation, frequently by means of 100% or more
portfolio turnover, leveraging, purchasing unregistered
securities, purchasing options, etc. The fund may take large cash
positions.
(h) Lipper Equity Income Funds Index - is comprised of the 30 largest
funds, in terms of total net assets, which seek relatively high
current income and growth of income through investing 60% or more
of their portfolios in equities.
(i) Lipper Small Cap Funds Index- a fund that by prospectus or
portfolio practice invests primarily in companies with market
capitalizations of less than $1 billion at the time of
purchase.
(j) Morgan Stanley Capital International EAFE Index and World Index -
- respectively, arithmetic, market value-weighted averages of the
performance of over 900 securities listed on the stock exchanges
of countries in Europe, Australia and the Far East, and over
1,400 securities listed on the stock exchanges of these
continents, including North America.
(k) Goldman Sachs 100 Convertible Bond Index -- currently includes 67
bonds and 33 preferred. The original list of names was generated
by screening for convertible issues of 100 million or greater in
market capitalization. The index is priced monthly.
B-1
<PAGE>
(l) Salomon Brothers GNMA Index -- includes pools of mortgages
originated by private lenders and guaranteed by the mortgage
pools of the Government National Mortgage Association.
(m) Salomon Brothers High Grade Corporate Bond Index -- consists of
publicly issued, non-convertible corporate bonds rated AA or AAA.
It is a value-weighted, total return index, including
approximately 800 issues with maturities of 12 years or
greater.
(n) Salomon Brothers Broad Investment Grade Bond Index -- is a
market-weighted index that contains approximately 4,700
individually priced investment grade corporate bonds rated BBB or
better, U.S. Treasury/agency issues and mortgage pass through
securities.
(o) Lehman Brothers Long-Term Treasury Bond -- is composed of all
bonds covered by the Lehman Brothers Treasury Bond Index with
maturities of 10 years or greater.
(p) Lehman Brothers Government/Corporate Index -- is a combination of
the Government and Corporate Bond Indices. The Government Index
includes public obligations of the U.S. Treasury, issues of
Government agencies, and corporate debt backed by the U.S.
Government. The Corporate Bond Index includes fixed-rate
nonconvertible corporate debt. Also included are Yankee Bonds and
nonconvertible debt issued by or guaranteed by foreign or
international governments and agencies. All issues are investment
grade (BBB) or higher, with maturities of at least one year and
an outstanding par value of at least $100 million for U.S.
Government issues and $25 million for others. Any security
downgraded during the month is held in the index until month-end
and then removed. All returns are market value weighted inclusive
of accrued income.
(q) NASDAQ Industrial Index -- is composed of more than 3,000
industrial issues. It is a value-weighted index calculated on
price change only and does not include income.
(r) Value Line -- composed of over 1,600 stocks in the Value Line
Investment Survey.
(s) Russell 2000 Index -- composed of the 2,000 smallest stocks in
the Russell 3000, a market value-weighted index of the 3,000
largest U.S. publicly-traded companies.
(t) The Salomon Brothers 3-Month T-Bill Average - the average return
for all treasury bills for the previous three month period.
(u) Composite Indices -- 60% Standard & Poor's 500 Stock Index, 30%
Lehman Brothers Long-Term Treasury Bond and 10% U.S. Treasury
Bills; 70% Standard & Poor's 500 Stock Index and 30% NASDAQ
Industrial Index; 35% Standard & Poor's 500 Stock Index and 65%
Salomon Brothers High Grade Bond Index; all stocks on the NASDAQ
system exclusive of those traded on an exchange, and 65% Standard
& Poor's 500 Stock Index and 35% Salomon Brothers High Grade Bond
Index.
(v) CDA Mutual Fund Report published by CDA Investment Technologies,
Inc. -- analyzes price, current yield, risk, total return and
average rate of return (average compounded growth rate) over
specified time periods for the mutual fund industry.
(w) Mutual Fund Source Book published by Morningstar, Inc. --
analyzes price, yield, risk and total return for equity
funds.
(x) Financial publications: Business Week, Changing Times, Financial
World, Forbes, Fortune, Money, Barron's, Consumer's Digest,
Financial Times, Global Investor, Wall
B-2
<PAGE>
Street Journal and Weisenberger Investment Companies Service --
publications that rate fund performance over specified time
periods.
(y) Consumer Price Index (or Cost of Living Index), published by the
U.S. Bureau of Labor Statistics -- a statistical measure of
change over time in the price of goods and services in major
expenditure groups.
(z) Stocks, Bonds, Bills and Inflation, published by Ibbotson
Associates -- historical measure of yield, price and total return
for common and small company stock, long-term government bonds,
U.S. Treasury bills and inflation.
(aa) Savings and Loan Historical Interest Rates -- as published by the
U.S. Savings & Loan League Fact Book.
(bb) Historical data supplied by the research departments of First
Boston Corporation; the J.P. Morgan Companies; Salomon Brothers;
Merrill Lynch, Pierce, Fenner & Smith; Lehman Brothers, Inc.; and
Bloomberg L.P.
B-3
<PAGE>
PART C
UAM FUNDS TRUST
OTHER INFORMATION
ITEM 23. EXHIBITS
Exhibits previously filed by the Fund are incorporated by reference to such
filings. The following table describes the location of all exhibits. In the
table, the following references are used: PEA 23 = Post Effective Amendment No.
23 filed on July 2, 1998; PEA 22 = Post Effective Amendment No. 22 filed on June
24, 1998; PEA 21 = Post Effective Amendment No. 21 filed on June 19, 1998; PEA
20 = Post-Effective Amendment No. 20 filed on March 26, 1998, PEA 19 = Post-
Effective Amendment No. 19 filed on February 3, 1998; PEA 18 = Post-Effective
Amendment No. 18 filed on January 23, 1998, PEA17 = Post-Effective Amendment No.
17 filed on December 15, 1997, PEA16 = Post-Effective Amendment No. 16 filed on
July 10, 1997, PEA14 = Post-Effective Amendment No. 14 filed on September 17,
1996, PEA13 = Post-Effective Amendment No. 13 filed on August 28, 1996, PEA12 =
Post-Effective Amendment No. 12 filed on July 17, 1996, PEA8 = Post-Effective
Amendment No. 8 filed on March 13, 1996, PEA4 = Post-Effective Amendment No. 4
filed on February 9, 1995, PEA3 = Post-Effective Amendment No. 3 filed on
December 14, 1994, PEA2 = Post-Effective Amendment No. 2 filed on November 25,
1994, PEA1 = Post-Effective Amendment No. 1 filed on November 15, 1994, and RS =
Original Registration Statement on Form N-1A filed on June 3, 1994.
<TABLE>
<CAPTION>
Exhibit Incorporated by
- ---------- Reference to (Location):
------------------------
<S> <C>
A. 1. Agreement and Declaration of Trust Filed herewith
2. Certificate of Trust Filed herewith
3. Certificate of Amendment to Certificate of Trust Filed herewith
B. By-Laws Filed herewith
C. 1. Form of Specimen Share Certificates Filed herewith
2. Article 9 of Bylaws Filed herewith
3. Excerpts from Agreement and Declaration of Trust Filed herewith
D. Investment Advisory Agreements RS, PEA1, PEA2, PEA3, PEA4, PEA12, PEA14, PEA17, PEA18,
PEA 21; PEA 22, PEA 23
E. 1. Distribution Agreement (UAM Funds Distributors, Inc.) Filed herewith
2. Distribution Agreement (ACG Capital Corporation) PEA17, PEA19
F. Trustees' and Officers' Contracts and Programs Not applicable
G. 1. Global Custody Agreement PEA16
H. 1. Fund Administration Agreement PEA13
2. Mutual Funds Service Agreement PEA16
I. (1) and (2) Opinions and Consents of Counsel Filed herewith
J. Consent of Independent Auditors Filed herewith
K. Other Financial Statements Not applicable
L. Purchase Agreement Filed herewith
M. 1. Distribution Plan Filed herewith
2. Selling Dealer Agreements Filed herewith
3. Shareholder Services Plan Filed herewith
4. Service Agreement Filed herewith
</TABLE>
<PAGE>
<TABLE>
<S> <C>
N. Financial Data Schedule Filed herewith
O. Amended and Restated Rule 18f-3 Multiple Class Plan Filed herewith
P. Powers of Attorney Filed herewith
</TABLE>
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
Not applicable.
ITEM 25. INDEMNIFICATION
Reference is made to Article VI of Registrant's Declaration of Trust, which is
incorporated herein by reference. Registrant hereby also makes the undertaking
consistent with Rule 484 under the Securities Act of 1933, as amended. Insofar
as indemnification for liability 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 is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a trustee, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
Provisions for indemnification of UAM Fund Services, Inc. are contained in
Section 6 of its Fund Administration Agreement with the Registrant.
Provisions for indemnification of the Registrant's investment advisers are
contained in Section 7 of their respective Investment Advisory Agreements with
the Registrant.
Provisions for indemnification of Registrant's principal underwriter, UAM Fund
Distributors, Inc., are contained in its Distribution Agreement with the
Registrant.
Provisions for indemnification of Registrant's custodian, The Chase Manhattan
Bank, are contained in Section 12 of its Fund Global Custody Agreement with the
Registrant.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
Reference is made to the caption "Investment Adviser" in the Prospectuses
constituting Part A of this Registration Statement and "Investment Adviser" in
Part B of this Registration Statement. Except for information with respect to
Pell Rudman Trust Company, N.A., the information required by this Item 26 with
respect to each director, officer, or partner of each other investment adviser
of the Registrant is incorporated by reference to the Forms ADV filed by the
investment advisers listed below with the Securities and Exchange Commission
pursuant to the Investment Advisers Act of 1940, as amended, under the file
numbers indicated:
<TABLE>
<CAPTION>
Investment Adviser File No.
- ------------------ --------
<S> <C>
Barrow, Hanley, Mewhinney & Strauss, Inc. 801-31237
Cambiar Investors, Inc. 801-09538
Chicago Asset Management Company 801-20197
Dwight Asset Management Company 801-45304
</TABLE>
<PAGE>
<TABLE>
<S> <C>
First Pacific Advisors, Inc. 801-39512
Hanson Investment Management Company 801-14817
Heitman/PRA Securities Advisors, Inc. 801-48252
Jacobs Asset Management, L.P. 801-49790
Murray Johnstone International Ltd. 801-34926
Pacific Financial Research, Inc. 801-54352
Tom Johnson Investment Management, Inc. 801-42549
</TABLE>
<TABLE>
<CAPTION>
Name and Principal Business Address Positions and Offices with Pell Rudman Positions and Offices with Pell
- ----------------------------------- -------------------------------------- -------------------------------
Trust Company, N.A. Rudman & Co., Inc
------------------- -----------------
<S> <C> <C>
Jeffrey S. Thomas Director Chief Financial Officer of
100 Federal Street Pell, Rudman & Co., Inc.
Boston, Massachusetts
Edward I. Rudman Director Chairman and President of Pell,
100 Federal Street Rudman & Co., Inc.
Boston, Massachusetts
James S. McDonald Director Executive Vice President of
100 Federal Street Pell, Rudman & Co., Inc.
Boston, Massachusetts
Susan W. Hunnewell Director Senior Vice President of Pell,
100 Federal Street Rudman & Co., Inc.
Boston, Massachusetts
</TABLE>
Barrow, Hanley, Mewhinney & Strauss, Inc., Cambiar Investors, Inc., Chicago
Asset Management Company, Dwight Asset Management Company, First Pacific
Advisors, Inc., Hanson Investment Management Company, Heitman/PRA Securities
Advisors, Inc., Jacobs Asset Management, L.P., Murray Johnstone International
Ltd., Pacific Financial Research, Inc., Pell Rudman Trust Company, N.A., and Tom
Johnson Investment Management, Inc., are affiliates of United Asset Management
Corporation ("UAM"), a Delaware corporation owning firms engaged primarily in
institutional investment management.
ITEM 27. PRINCIPAL UNDERWRITERS
(a) Except for Heitman Real Estate Portfolio Advisor Class Shares, UAM Fund
Distributors, Inc. ("UAMFDI"), the firm which acts as sole distributor of
the Registrant's shares, also acts as sole distributor for UAM Funds, Inc.,
Analytic Optioned Equity Fund, Inc. and The Analytic Series Fund. ACG
Capital Corporation ("ACG") acts as sole distributor of the Heitman Real
Estate Portfolio Advisor Class Shares.
(b) The information required with respect to each Director and officer of
UAMFSI is incorporated by reference to Schedule A of Form BD filed pursuant
to the Securities and Exchange Act of 1934 (SEC File No. 8-41126).
The information required with respect to each Director and officer of ACG
is incorporated by reference to
<PAGE>
Schedule A of Form BD filed pursuant to the Securities and Exchange Act of
1934 (SEC File No. 8-47813).
(c) Not applicable.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
The books, accounts and other documents required by Section 31(a) under the
Investment Company Act of 1940, as amended, and the rules promulgated thereunder
will be maintained in the physical possession of the Registrant, the
Registrant's Advisers, the Registrant's Sub-Transfer and Sub-Administrative
Agent (Chase Global Funds Services Company, 73 Tremont Street, Boston,
Massachusetts 02108) and the Registrant's Custodian Bank (The Chase Manhattan
Bank 4 Chase MetroTech Center, Brooklyn, New York, 11245).
ITEM 29. MANAGEMENT SERVICES
Not Applicable.
ITEM 30. UNDERTAKINGS
Not Applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements of effectiveness of the Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933, and has duly caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston and Commonwealth of
Massachusetts on the 17th day of July, 1998.
UAM FUNDS TRUST
/s/ Michael E. DeFao
--------------------
Michael E. DeFao
Secretary
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the 17th day of July, 1998:
*
______________________________
Norton H. Reamer, Chairman and
President
*
______________________________
John T. Bennett, Jr., Trustee
*
_____________________________
Nancy J. Dunn, Trustee
*
_____________________________
Philip D. English, Trustee
*
_____________________________
William A. Humenuk, Trustee
*
_____________________________
Peter M. Whitman, Jr., Trustee
/s/ Gary L. French
- ------------------
Gary L. French, Treasurer
/s/ Michael E. DeFao
- --------------------
* Michael E. DeFao
(Attorney-in-Fact)
<PAGE>
UAM FUNDS TRUST
FILE NOS. 811-8544/33-79858
POST-EFFECTIVE AMENDMENT NO. 24
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
A. 1. Agreement and Declaration of Trust
A. 2. Certificate of Trust
A. 3. Certificate of Amendment to Certificate of Trust
B. By-Laws
C. 1. Form of Specimen Share Certificates
C. 2. Article 9 of Bylaws
C. 3. Excerpts from Agreement and Declaration of Trust
E. 1. Distribution Agreement
I. (1) and (2) Opinions and Consents of Counsel
J. Consent of Independent Auditors
L. Purchase Agreement
M. 1. Distribution Plan
M. 2. Selling Dealer Agreement
M. 3. Shareholder Services Plan
M. 4. Service Agreements
N. Financial Data Schedules
O. Amended and Restated Rule 18f-3 Multiple Class Plan
P. Powers of Attorney
</TABLE>
<PAGE>
EXHIBIT A.1.
THE REGIS FUND II
AGREEMENT AND DECLARATION OF TRUST
APRIL 26, 1994
<PAGE>
AGREEMENT AND DECLARATION OF TRUST
<TABLE>
<CAPTION>
<S> <C>
ARTICLE I. NAME AND DEFINITIONS....................................................... 1
Section 1.1 Name and Principal Office.................................................. 1
Section 1.2 Definitions................................................................ 1
(a) "Act"........................................................ 1
(b) "By-laws".................................................... 1
(c) "class"...................................................... 1
(d) "Commission"................................................. 1
(e) "Declaration of Trust"....................................... 1
(f) "Majority of the Outstanding Voting Shares".................. 1
(g) "1940 Act"................................................... 1
(h) "person"..................................................... 2
(i) "Shareholder"................................................ 2
(j) "Shares"..................................................... 2
(k) "Sub-Trust" or "Series"...................................... 2
(l) "Trust"...................................................... 2
(m) "Trustees"................................................... 2
ARTICLE II. PURPOSE OF TRUST........................................................... 2
ARTICLE III. THE TRUSTEES............................................................... 2
Section 3.1 Number, Designation, Election, Term, etc................................... 2
(a) Initial Trustees............................................. 2
(b) Number....................................................... 2
(c) Election and Term............................................ 2
(d) Resignation and Retirement................................... 3
(e) Removal...................................................... 3
(f) Vacancies.................................................... 3
(g) Effect of Death, Resignation, etc............................ 3
(h) No Accounting................................................ 3
Section 3.2 Powers of Trustees......................................................... 3
(a) Investments.................................................. 4
(b) Disposition of Assets........................................ 4
(c) Ownership Powers............................................. 4
(d) Subscription................................................. 4
(e) Form of Holding.............................................. 4
(f) Reorganization, etc.......................................... 4
(g) Voting Trusts, etc........................................... 4
(h) Compromise................................................... 5
(i) Partnerships, etc............................................ 5
(j) Borrowing and Security....................................... 5
(k) Guarantees, etc.............................................. 5
(l) Insurance.................................................... 5
(m) Pensions, etc................................................ 5
(n) Distribution Plans........................................... 5
Section 3.3 Certain Contracts.......................................................... 5
(a) Advisory..................................................... 5
(b) Administration............................................... 5
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(c) Distribution................................................. 6
(d) Custodian and Depository..................................... 6
(e) Transfer and Dividend Disbursing Agency...................... 6
(f) Shareholder Servicing........................................ 6
(g) Accounting................................................... 6
Section 3.4 Payment of Trust Expenses and Compensation of Trustees..................... 6
Section 3.5 Ownership of Assets of the Trust........................................... 7
Section 3.6 Action by Trustees......................................................... 7
ARTICLE IV. SHARES..................................................................... 7
Section 4.1 Description of Shares...................................................... 7
Section 4.2 Establishment and Designation of Sub-Trusts and Classes.................... 9
(a) Assets Belonging to Sub-Trusts............................... 9
(b) Liabilities Belonging to Sub-Trusts.......................... 9
(c) Dividends.................................................... 9
(d) Liquidation.................................................. 10
(e) Voting....................................................... 10
(f) Redemption by Shareholder.................................... 10
(g) Redemption of Trust.......................................... 11
(h) Net Asset Value.............................................. 11
(i) Transfer..................................................... 11
(j) Equality..................................................... 11
(k) Fractions.................................................... 11
(l) Conversion Rights............................................ 11
(m) Class Differences............................................ 12
Section 4.3 Ownership of Shares........................................................ 12
Section 4.4 Investments in the Trust................................................... 12
Section 4.5 No Pre-emptive Rights...................................................... 12
Section 4.6 Status of Shares and Limitation of Personal Liability...................... 12
Section 4.7 No Appraisal Rights........................................................ 12
ARTICLE V. SHAREHOLDERS' VOTING POWERS AND MEETINGS................................... 12
Section 5.1 Voting Powers.............................................................. 12
Section 5.2 Meetings................................................................... 13
Section 5.3 Record Dates............................................................... 13
Section 5.4 Quorum and Required Vote................................................... 13
Section 5.5 Action by Written Consent.................................................. 13
Section 5.6 Inspection of Records...................................................... 14
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Section 5.7 Additional Provisions...................................................... 14
ARTICLE VI. LIMITATION OF LIABILITY; INDEMNIFICATION................................... 14
Section 6.1 Trustees, Shareholders, etc. Not Personally Liable; Notice................. 14
Section 6.2 Trustee's Good Faith Action; Expert Advice; No Bond or Surety ............. 14
Section 6.3 Indemnification of Shareholders............................................ 15
Section 6.4 Indemnification of Trustees, Officers, etc................................. 15
Section 6.5 Compromise Payment......................................................... 15
Section 6.6 Indemnification Not Exclusive, etc......................................... 16
Section 6.7 Liability of Third Persons Dealing with Trustees........................... 16
Section 6.8 Discretion................................................................. 16
ARTICLE VII. MISCELLANEOUS.............................................................. 16
Section 7.1 Duration and Termination of Trust.......................................... 16
Section 7.2 Reorganization............................................................. 16
Section 7.3 Amendments................................................................. 17
Section 7.4 Filing of Copies; References; Headings..................................... 17
Section 7.5 Applicable Law............................................................. 17
Section 7.6 Registered Agent........................................................... 18
Section 7.7 Integration................................................................ 18
</TABLE>
<PAGE>
AGREEMENT AND DECLARATION OF TRUST
AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts this 26th
day of April, 1994, by the Trustee or Trustees hereunder, and by the holders of
shares of beneficial interest to be issued hereunder as hereinafter provided.
WITNESSETH
WHEREAS this Trust has been formed to carry on the business of an investment
company; and
WHEREAS this Trust is authorized to issue its shares of beneficial interest in
separate series, each separate series to be a Sub-Trust hereunder, and to issue
classes of Shares of any Sub-Trust or divide Shares of any Sub-Trust into two or
more classes, all in accordance with the provisions hereinafter set forth; and
WHEREAS the Trustees have agreed to manage all property coming into their hands
as trustees of a Delaware business trust in accordance with the provisions of
the Delaware Business Trust Act (12 Del. C. (S) 3801, et seq.), as from time to
time amended and including any successor statute of similar import (the "Act"),
and the provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will hold all cash,
securities, and other assets which they may from time to time acquire in any
manner as Trustees hereunder IN TRUST to manage and dispose of the same upon the
following terms and conditions for the benefit of the holders from time to time
of shares of beneficial interest in this Trust and the Sub-Trusts created
hereunder as hereinafter set forth.
ARTICLE I
NAME AND DEFINITIONS
Section 1.1 NAME AND PRINCIPAL OFFICE. This Trust shall be known as THE
REGIS FUND II and the Trustees shall conduct the business of the Trust under
that name or any other name or names as they may from time to time determine.
The principal office of the Trust shall be located at such location as the
Trustees may from time to time determine.
Section 1.2 DEFINITIONS. Whenever used herein, unless otherwise
required by the context or specifically provided:
(a) "Act" shall have the meaning given to it in the recitals of this
Declaration of Trust.
(b) "By-Laws" shall mean the By-Laws of the Trust as amended from time
to time;
(c) "class" refers to any class of Shares of any Series or Sub-Trust
established and designated under or in accordance with the provisions of Article
IV;
(d) "Commission" shall have the meaning given it in the 1940 Act;
(e) "Declaration of Trust" shall mean this Agreement and Declaration of
Trust as amended or restated from time to time;
(f) "Majority of the Outstanding Voting Shares" of the Trust or Sub-
Trust shall mean the vote, at the annual or a special meeting of Shareholders
duly called, (A) of 67 per centum or more of the Shares of the Trust or Sub-
Trust present at such meeting, if holders of more than 50 per centum of the
outstanding Shares of the Trust or Sub-Trust are present or represented by
proxy; or (B) of more than 50 per centum of the outstanding voting Shares of the
Trust or Sub-Trust, whichever is the less.
2
<PAGE>
(g) "1940 Act" refers to the Investment Company Act of 1940 and the
Rules and Regulations hereunder, all as amended from time to time;
(h) "person" means a natural person, corporation, limited liability
company, trust, association, partnership (whether general, limited, or
otherwise), joint venture, or any other entity;
(i) "Shareholder" means a beneficial owner of record of Shares;
(j) "Shares" refers to the transferable units of interest into which the
beneficial interest in the Trust and each Sub-Trust of the Trust and/or any
class of any Sub-Trust (as the context may require) shall be divided from time
to time;
(k) "Sub-Trust" or "Series" refers to a series of Shares established and
designated under or in accordance with the provisions of Article IV;
(l) "Trust" refers to the Delaware business trust established by this
Declaration of Trust, inclusive of each and every Sub-Trust established
hereunder; and
(m) "Trustees" refers to the trustees of the Trust and of each Sub-Trust
hereunder named herein or elected in accordance with Article III.
ARTICLE II
PURPOSE OF TRUST
The purposes of the Trust are (i) to operate as an investment company and
to offer Shareholders of the Trust and each Sub-Trust of the Trust one or more
investment programs primarily in securities and debt instruments, and (ii) to
engage in such activities that are necessary, suitable, incidental, or
convenient to the accomplishment of the foregoing.
ARTICLE III
THE TRUSTEES
Section 3.1 NUMBER,DESIGNATION, ELECTION, TERM, ETC.
(a) TRUSTEES. The initial Trustees hereof shall be seven (7).
(b) NUMBER. The Trustees serving as such, whether named above or
hereafter becoming Trustees, may increase or decrease the number of Trustees to
a number other than the number theretofore determined. No decrease in the
number of Trustees shall have the effect of removing any Trustee from office
prior to the expiration of his term, but the number of Trustees may be decreased
in conjunction with the removal of a Trustee pursuant to subsection (e) of this
Section 3.1.
(c) ELECTION AND TERM. The Trustees shall be elected by the
Shareholders of the Trust at a meeting of the Shareholders held prior to the
effective date of the Registration Statement of the Trust under the 1940 Act,
and the term of office of any Trustees in office before such election shall
terminate at the time of such election. Each Trustee shall be a natural person
and may, but need not be a Shareholder. Each Trustee, whether named above or
hereafter becoming a Trustee, shall serve as a Trustee of the Trust and of each
Sub-Trust hereunder during the lifetime of this Trust and until its termination
as hereinafter provided except as such Trustee sooner dies, resigns, retires, or
is removed or, if sooner, until the next meeting of Shareholders called for the
purpose of electing Trustees and until the election and qualification of his
successor. The Shareholders
3
<PAGE>
may fix the number of Trustees and elect Trustees at any meeting of Shareholders
called by the Trustees for that purpose and to the extent required by applicable
law, including paragraph (a) and (b) of Section 16 of the 1940 Act. Subject to
Section 16(a) of the 1940 Act, the Trustees may elect successors and may,
pursuant to Section 3.1(f) hereof, appoint Trustees to fill vacancies.
(d) RESIGNATION AND RETIREMENT. Any Trustee may resign his trust or
retire as a trustee of the Trust, by written instrument signed by him and
delivered to the other Trustees or to any officer of the Trust, and such
resignation or retirement shall take effect upon such delivery or upon such
later date as is specified in such instrument and shall be effective as to the
Trust and each Sub-Trust hereunder.
(e) REMOVAL. Any Trustee may be removed with or without cause at any
time by written instrument, signed by at least two-thirds of the number of
Trustees in office immediately prior to such removal, specifying the date upon
which such removal shall become effective. Any such removal shall be effective
as to the Trust and each Sub-Trust hereunder.
(f) VACANCIES. Any vacancy or anticipated vacancy resulting from any
reason, including without limitation the death, resignation, retirement, removal
or incapacity of any of the Trustees, or resulting from an increase in the
number of Trustees by the other Trustees may (but so long as there are at least
two remaining Trustees, need not unless required by the 1940 Act) be filled by a
majority of the remaining Trustees, subject to the provisions of Section 16(a)
of the 1940 Act, through the appointment of such other person as such remaining
Trustees in their discretion shall determine. Such appointment shall be
evidenced by a written instrument signed by a majority of the Trustees then in
office, or by a recording in the records of the Trust, and shall be effective
upon such signing or recording and the acceptance of the person named therein to
serve as a trustee of the Trust and agreement by such person to be bound by the
provisions of this Declaration of Trust. Any such appointment in anticipation
of a vacancy to occur by reason of retirement, resignation or increase in number
of Trustees to be effective at a later date shall be deemed effective upon the
effective date of said retirement, resignation or increase in number of
Trustees.
(g) EFFECT OF DEATH, RESIGNATION, ETC. The death, resignation,
retirement, removal or incapacity of the Trustees, or any one of them, shall
cause a Trustee to cease to be a trustee of the Trust but shall not operate to
annul or terminate the Trust or any Sub-Trust hereunder or to revoke or
terminate any existing agency or contract created or entered into pursuant to
the terms of this Declaration of Trust.
(h) NO ACCOUNTING. Except to the extent required by the 1940 Act or
under circumstances which would justify his removal for cause, no person ceasing
to be a trustee of the Trust as a result of his death, resignation, retirement,
removal or incapacity (nor the estate of any such person) shall be required to
make an accounting to the Shareholders or remaining Trustees upon such
cessation.
Section 3.2 POWERS OF TRUSTEES. Subject to the provisions of this
Declaration of Trust, the business of the Trust shall be managed by the
Trustees, and they shall have all powers necessary or convenient to carry out
that responsibility and the purpose of the Trust. The Trustees in all instances
shall act as principals, and are and shall be free from the control of the
Shareholders. The Trustees shall have full power and authority to do any and all
acts and to make and execute any and all contracts and instruments that they may
consider necessary or appropriate in connection with the management of the
Trust. The Trustees shall not be bound or limited by present or future laws or
customs with regard to investment by trustees or fiduciaries, but shall have
full authority and absolute power and control over the assets of the Trust and
the business of the Trust to the same extent as if the Trustees were the sole
owners of the assets of the Trust and the business in their own right, including
such authority, power and control to do all acts and things as they, in their
sole discretion, shall deem proper to accomplish the purposes of this Trust.
Without limiting the foregoing, the Trustees may adopt By-Laws not inconsistent
with this Declaration of Trust providing for the conduct of the business and
affairs of the Trust and may amend and repeal them to the extent that such By-
Laws do not reserve that right to the Shareholders; they may from time to time
in accordance with the provisions of Section 4.1 hereof establish Sub-Trusts,
each such Sub-Trust to operate as a separate and distinct investment medium and
with separately defined investment objectives and policies and distinct
investment purposes; they may
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from time to time in accordance with the provisions of Section 4.1 hereof
establish Series or establish classes of Shares of any Series or Sub-Trust or
divide the Shares of any Series or Sub-Trust into classes; they may as they
consider appropriate designate employees and agents who may be denominated as
officers with titles, including, but not limited to, "president", "vice-
president", "treasurer", "secretary", "assistant treasurer", "assistant
secretary", "managing director", "chairman of the board" and "vice chairman of
the board" and who in such capacity may act for and on behalf of the Trust, as
and to the extent authorized by the Trustees, and appoint and terminate agents
and consultants and hire and terminate employees, any one or more of the
foregoing of whom may be a Trustee, and may provide for the compensation of all
of the foregoing; they may appoint from their own number, and terminate, any one
or more committees consisting of two or more Trustees, including without implied
limitation an executive committee, which may, when the Trustees are not in
session and subject to the 1940 Act, exercise some or all of the power and
authority of the Trustees as the Trustees may determine; in accordance with
Section 3.3 they may employ one or more advisers, administrators, depositories
and custodians and may authorize any depository or custodian to employ
subcustodians or agents and to deposit all or any part of such assets in a
system or systems for the central handling of securities and debt instruments,
retain transfer, dividend, accounting or Shareholder servicing agents or any of
the foregoing, provide for the distribution of Shares by the Trust through one
or more distributors, principal underwriters, or otherwise, and subject to
Section 5.3 set record dates or times for the determination of Shareholders or
various of them with respect to various matters; they may compensate or provide
for the compensation of the Trustees, officers, advisers, administrators,
custodians, other agents, consultants and employees of the Trust or the Trustees
on such terms as they deem appropriate; and in general they may delegate to any
officer of the Trust, to any committee of the Trustees and to any employee,
adviser, administrator, distributor, depository, custodian, transfer and
dividend disbursing agent, or any other agent or consultant of the Trust such
authority, powers, functions and duties as they consider desirable or
appropriate for the conduct of the business and affairs of the Trust, including
without implied limitation the power and authority to act in the name of the
Trust and any Sub-Trust and of the Trustees, to sign documents and to act as
attorney-in-fact for the Trustees.
Without limiting the foregoing and to the extent not inconsistent with
the 1940 Act or other applicable law, the Trustees shall have power and
authority for and on behalf of the Trust and each separate Sub-Trust established
hereunder:
(a) INVESTMENTS. To invest and reinvest cash and other property, and
to hold cash or other property uninvested without in any event being bound or
limited by any present or future law or custom in regard to investments by
trustees;
(b) DISPOSITION OF ASSETS. To sell, exchange, lend, pledge, mortgage,
hypothecate, write options on and lease any or all of the assets of the Trust;
(c) OWNERSHIP POWERS. To vote or give assent, or exercise any rights
of ownership, with respect to stock or other securities, debt instruments or
property; and to execute and deliver proxies or powers of attorney to such
person or persons as the Trustees shall deem proper, granting to such person or
persons such power and discretion with relation to securities, debt instruments
or property as the Trustees shall deem proper;
(d) SUBSCRIPTION. To exercise powers and rights of subscription or
otherwise which in any manner arise out of ownership of securities or debt
instruments;
(e) FORM OF HOLDING. To hold any security, debt instrument or property
in a form not indicating any trust, whether in bearer, unregistered or other
negotiable form, or in the name of the Trustees or of the Trust or of any Sub-
Trust or in the name of a custodian, subcustodian or other depository or a
nominee or nominees or otherwise;
(f) REORGANIZATION, ETC. To consent to or participate in any plan for
the reorganization, consolidation, or merger of any corporation or issuer, any
security or debt instrument of which is or was held
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in the Trust; to consent to any contract, lease, mortgage, purchase, or sale of
property by such corporation or issuer, and to pay calls or subscriptions with
respect to any security or debt instrument held in the Trust;
(g) VOTING TRUSTS, ETC. To join with other holders of any securities
or debt instruments in acting through a committee, depositary, voting trustee,
or otherwise, and in that connection to deposit any security or debt instrument
with, or transfer any security or debt instrument to, any such committee,
depositary, or trustee, and to delegate to them such power and authority with
relation to any security or debt instrument (whether or not so deposited or
transferred) as the Trustees shall deem proper, and to agree to pay, and to pay,
such portion of the expenses and compensation of such committee, depositary or
trustee as the Trustees shall deem proper;
(h) COMPROMISE. To compromise, arbitrate or otherwise adjust claims in
favor of or against the Trust or any Sub-Trust or any matter in controversy,
including but not limited to claims for taxes;
(i) PARTNERSHIPS, ETC. To enter into joint ventures, general or limited
partnerships, limited liability companies, and any other combinations or
associations ;
(j) BORROWING AND SECURITY. To borrow funds and to mortgage and pledge
the assets of the Trust or any part thereof to secure obligations arising in
connection with such borrowing;
(k) GUARANTEES, etc. To endorse or guarantee the payment of any notes
or other obligations of any person; to make contracts of guaranty or suretyship,
or otherwise assume liability for payment thereof; and to mortgage and pledge
the Trust property or any part thereof to secure any of or all such obligations;
(l) INSURANCE. To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate for the conduct of the
business, including, without limitation, insurance policies insuring the assets
of the Trust and payment of distributions and principal on its portfolio
investments, and insurance policies insuring the Shareholders, Trustees,
officers, employees, agents, consultants, investment advisers, managers,
administrators, distributors, principal underwriters, or independent
contractors, or any thereof (or any person connected therewith), of the Trust
individually against all claims and liabilities of every nature arising by
reason of holding, being or having held any such office or position, or by
reason of any action alleged to have been taken or omitted by any such person in
any such capacity, including any action taken or omitted that may be determined
to constitute negligence, whether or not the Trust would have the power to
indemnify such person against such liability;
(m) PENSIONS, ETC. To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry out pension,
profit-sharing, share bonus, share purchase, savings, thrift and other
retirement, incentive and benefit plans, trusts and provisions, including the
purchasing of life insurance and annuity contracts as a means of providing such
retirement and other benefits, for any or all of the Trustees, officers,
employees, and agents of the Trust; and
(n) DISTRIBUTION PLANS. To adopt on behalf of the Trust or any Sub-
Trust, including with respect to any class thereof, a plan of distribution and
related agreements thereto pursuant to the terms of Rule 12b-1 of the 1940 Act
and to make payments from the assets of the Trust or the relevant Sub-Trust or
Sub-Trusts pursuant to said Rule 12b-1 Plan.
Section 3.3 CERTAIN CONTRACTS. Subject to compliance with the provisions
of the 1940 Act, but notwithstanding any limitations of present and future law
or custom in regard to delegation of powers by trustees generally, the Trustees
may, at any time and from time to time and without limiting the generality of
their powers and authority otherwise set forth herein, enter into one or more
contracts with any one or more corporations, trusts, associations, partnerships,
limited partnerships, limited liability companies, other type of organizations,
or individuals (a "Contracting Party"), to provide for the performance and
assumption of some or all of the following services, duties, and
responsibilities to, for, or on behalf of the Trust and/or any Sub-
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Trust, and/or the Trustees, and to provide for the performance and assumption of
such other services, duties, and responsibilities in addition to those set forth
below as the Trustees may determine appropriate:
(a) ADVISORY. Subject to the general supervision of the Trustees and in
conformity with the stated policy of the Trustees with respect to the
investments of the Trust or of the assets belonging to any Sub-Trust of the
Trust (as that phrase is defined in subsection (a) of Section 4.2), to manage
such investments and assets, make investment decisions with respect thereto, and
to place purchase and sale orders for portfolio transactions relating to such
investments and assets;
(b) ADMINISTRATION. Subject to the general supervision of the Trustees
and in conformity with any policies of the Trustees with respect to the
operations of the Trust and each Sub-Trust (including each class thereof), to
supervise all or any part of the operations of the Trust and each Sub-Trust, and
to provide all or any part of the administrative and clerical personnel, office
space, and office equipment and services appropriate for the efficient
administration and operations of the Trust and each Sub-Trust;
(c) DISTRIBUTION. To distribute the Shares of the Trust and each Sub-
Trust (including any classes thereof), to be principal underwriter of such
Shares, and/or to act as agent of the Trust and each Sub-Trust in the sale of
Shares and the acceptance or rejection of orders for the purchase of Shares;
(d) CUSTODIAN AND DEPOSITORY. To act as depository for and to maintain
custody of the property of the Trust and each Sub-Trust and accounting records
in connection therewith;
(e) TRANSFER AND DIVIDEND DISBURSING AGENCY. To maintain record of the
ownership of outstanding Shares, the issuance and redemption and the transfer
thereof, and to disburse any dividends declared by the Trustees and in
accordance with the policies of the Trustees and/or the instructions of any
particular Shareholder to reinvest any such dividends;
(f) SHAREHOLDER SERVICING. To provide service with respect to the
relationship of the Trust and its Shareholders, records with respect to
Shareholders and their Shares, and similar matters; and
(g) ACCOUNTING. To handle all or any part of the accounting
responsibilities, whether with respect to the Trust's properties, Shareholders
or otherwise.
The same person may be the Contracting Party for some or all of the service,
duties, and responsibilities to, for and of the Trust and/or the Trustees, and
the contracts with respect thereto may contain such terms interpretive of or in
addition to the delineation of the services, duties, and responsibilities
provided for, including provisions that are not inconsistent with the 1940 Act
relating to the standard of duty of and the rights to indemnification of the
Contracting Party and others, as the Trustees may determine. Nothing herein
shall preclude, prevent, or limit the Trust or a Contracting Party from entering
into sub-contractual arrangements relating to any of the matters referred to in
Sections 3.3(a) through (g) hereof.
The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is
a shareholder, director, officer, partner, trustee, employee, manager,
adviser, principal underwriter or distributor, or agent of or for any
Contracting Party, or of or for any parent or affiliate of any Contracting
Party or that the Contracting Party or any parent or affiliate thereof is a
Shareholder or has an interest in the Trust or any Sub-Trust, or that
(ii) any Contracting Party may have a contract providing for the
rendering of any similar services to one or more other corporations,
trusts, associations, partnerships, limited partnerships, limited liability
companies, or other organizations, or have other business or interests,
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shall not affect the validity of any contract for the performance and assumption
of services, duties, and responsibilities to, for or of the Trust or any Sub-
Trust and/or the Trustees or disqualify any Shareholder, Trustee or officer of
the Trust from voting upon or executing the same or create any liability or
accountability to the Trust, any Sub-Trust, or its Shareholders, provided that
in the case of any relationship or interest referred to in the preceding clause
(i) on the part of any Trustee or officer of the Trust either (x) the material
facts as to such relationship or interest have been disclosed to or are known by
the Trustees not having any such relationship or interest and the contract
involved is approved in good faith by a majority of such Trustees not having any
such relationship or interest (even though such unrelated or disinterested
Trustees are less than a quorum of all of the Trustees), (y) the material facts
as to such relationship or interest and as to the contract have been disclosed
to or are known by the Shareholders entitled to vote thereon and the contract
involved is specifically approved in good faith by vote of the Shareholders, or
(z) the specific contract involved is fair to the Trust as of the time it is
authorized, approved, or ratified by the Trustees or by the Shareholders.
Section 3.4 PAYMENT OF TRUST EXPENSES AND COMPENSATION OF TRUSTEES.
The Trustees are authorized to pay or to cause to be paid out of the principal
or income of the Trust or any Sub-Trust, or partly out of principal and partly
out of income, and to charge or allocate the same to, between, or among such one
or more of the Sub-Trusts and/or one or more classes of Shares thereof that may
be established and designated pursuant to Article IV, as the Trustees deem fair,
all expenses, fees, charges, taxes, and liabilities incurred or arising in
connection with the Trust, any Sub-Trust and/or any class of Shares thereof, or
in connection with the management thereof, including, but not limited to, the
Trustees' compensation and such expenses and charges for the services of the
Trust's officers, employees, investment adviser, administrator, distributor,
principal underwriter, auditor, counsel, depository, custodian, transfer agent,
dividend disbursing agent, accounting agent, Shareholder servicing agent, and
such other agents, consultants, and independent contractors and such other
expenses and charges as the Trustees may deem necessary or proper to incur.
Without limiting the generality of any other provision hereof, the Trustees
shall be entitled to reasonable compensation from the Trust for their services
as trustees of the Trust and may fix the amount of such compensation. Nothing
herein shall in any way prevent the employment of any Trustee for special
services, including legal, accounting, advisory, management or other services
and payment for the same by the Trust. Except to the extent expressly provided
in a written agreement with the Trust, no Trustee resigning and no Trustee
removed shall have any right to any compensation for any period following his
resignation or removal, or any right to damages on account of such removal.
The Trustees shall have the power, as frequently as they may determine, to
cause each Shareholder, or each Shareholder of any particular Sub-Trust, to pay
directly, in advance or arrears, for charges of the Trust"s custodian or
transfer, Shareholder servicing or similar agent, an amount fixed from time to
time by the Trustees, by setting off such charges due from such Shareholder from
declared but unpaid dividends owed such Shareholder and/or by reducing the
number of Shares in the account of such Shareholder by that number of full
and/or fractional Shares which represents the outstanding amount of such charges
due from such Shareholder.
Section 3.5 OWNERSHIP OF ASSETS OF THE TRUST. Title to all of the assets
of the Trust and of each Sub-Trust shall at all times be considered as vested in
the Trustees as joint tenants. The right, title and interest of the Trustees in
such assets shall vest automatically in each person who may hereafter become a
Trustee, and upon any Trustees' death, resignation or removal, such Trustee
shall automatically cease to have any right, title or interest in such assets.
Vesting and cessation of title as set forth in this Section 3.5 shall be
effective notwithstanding the absence of execution and delivery of any
conveyancing documents.
Section 3.6 ACTION BY TRUSTEES. Except as otherwise provided by the 1940
Act or other applicable law, this Declaration of Trust or the By-Laws, any
action to be taken by the Trustees on behalf of or with respect to the Trust or
any Sub-Trust or class thereof may be taken by a majority of the Trustees
present at a meeting of Trustees (a quorum, consisting of at least a majority of
the Trustees then in office, being present), within or without Delaware,
including any meeting held by means of a conference telephone or other
communications equipment by means of which all persons participating in the
meeting can hear each other at
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the same time, and participation by such means shall constitute presence in
person at a meeting, or by written consents of a majority of the Trustees then
in office (or such larger or different number as may be required by the 1940 Act
or other applicable law).
ARTICLE IV
SHARES
Section 4.1 DESCRIPTION OF SHARES. The beneficial interest in the
Trust shall be divided into Shares, all without par value, but the Trustees
shall have the authority from time to time to issue Shares in one or more Series
(each of which Series of Shares shall represent the beneficial interest in a
separate and distinct Sub-Trust of the Trust, including without limitation each
Sub-Trust specifically established and designated in Section 4.2), as they deem
necessary or desirable. For all purposes under this Declaration of Trust or
otherwise, including, without implied limitation, (i) with respect to the rights
of creditors and (ii) for purposes of interpreting the relevant rights of each
Sub-Trust and the Shareholders of each Sub-Trust, each Sub-Trust established
hereunder shall be deemed to be a separate trust. Notice of the limitation of
liabilities of a Sub-Trust shall be set forth in the certificate of trust of the
Trust, and debts, liabilities, obligations and expenses incurred, contracted for
or otherwise existing with respect to a particular Sub-Trust shall be
enforceable against the assets of such Sub-Trust only, and not against the
assets of the Trust generally.
Notwithstanding any other provisions of this Declaration of Trust and
without limiting the power of the Trustees to amend the Declaration of Trust as
provided elsewhere herein, the Trustees shall have the power to amend this
Declaration of Trust, at any time and from time to time, in such manner as the
Trustees may determine in their sole discretion, without the need for
Shareholder action, so as to add to, delete, replace or otherwise modify any
provisions relating to the Shares contained in this Declaration of Trust for the
purpose of responding to or complying with any regulations, orders, rulings or
interpretations of any governmental agency or any laws, now or hereafter
applicable to the Trust. The Trustees shall have exclusive power without the
requirement of Shareholder approval to establish and designate such separate and
distinct Sub-Trusts, and to fix and determine the relative rights and
preferences as between the shares of the separate Sub-Trusts as to right of
redemption and the price, terms and manner of redemption, special and relative
rights as to dividends and other distributions and on liquidation, sinking or
purchase fund provisions, conversion rights, and conditions under which the
several Sub-Trusts shall have separate voting rights or no voting rights.
In addition, the Trustees shall have exclusive power, without the
requirement of Shareholder approval, to issue classes of Shares of any Sub-Trust
or divide the Shares of any Sub-Trust into classes, each class having such
different dividend, liquidation, voting and other rights as the Trustees may
determine in their sole discretion, and may establish and designate the specific
classes of Shares of each Sub-Trust. The fact that a Sub-Trust shall have
initially been established and designated without any specific establishment or
designation of classes (i.e., that all Shares of such Sub-Trust are initially of
a single class), or that a Sub-Trust shall have more than one established and
designated class, shall not limit the authority of the Trustees to establish and
designate separate classes, or one or more further classes, of said Sub-Trust
without approval of the holders of the initial class thereof, or previously
established and designated class or classes thereof, provided that the
establishment and designation of such further separate classes would not
adversely affect the rights of the holders of the initial or previously
established and designated class or classes.
The number of authorized Shares and the number of Shares of each Sub-Trust
or class thereof that may be issued is unlimited, and the Trustees may issue
Shares of any Sub-Trust or class thereof for such consideration and on such
terms as they may determine (or for no consideration if pursuant to a Share
dividend or split-up), all without action or approval of the Shareholders. All
Shares when so issued on the terms determined by the Trustees shall be fully
paid and non-assessable (but may be subject to mandatory contribution back to
the Trust as provided in subsection (h) of Section 4.2). The Trustees may
classify or reclassify any unissued Shares or any Shares previously issued and
reacquired of any Sub-Trusts or class thereof into one or more Sub-Trust or
classes thereof that may be established and designated from time to time.
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The Trustees may hold as treasury Shares, reissue for such consideration and on
such terms as they may determine, or cancel, at their discretion from time to
time, any Shares of any Sub-Trust or class thereof reacquired by the Trust.
The Trustees may from time to time close the transfer books or establish
record dates and times for the purposes of determining the holders of Shares
entitled to be treated as such, to the extent provided or referred to in Section
5.3.
The establishment and designation of any Sub-Trust or of any class of
Shares of any Sub-Trust in addition to those established and designated in
Section 4.2 shall be effective (i) upon the execution by a majority of the then
Trustees of an instrument setting forth such establishment and designation of
the relative rights and preferences of the Shares of such Sub-Trust or class,
(ii) upon the execution of an instrument in writing by an officer of the Trust
pursuant to the vote of a majority of the Trustees, or (iii) as otherwise
provided in either such instrument. At any time that there are no Shares
outstanding of any particular Sub-Trust or class previously established and
designated, the Trustees may by an instrument executed by a majority of their
number (or by an instrument executed by an officer of the Trust pursuant to the
vote of a majority of the Trustees) abolish that Sub-Trust or class and the
establishment and designation thereof. Each instrument establishing and
designating any Sub-Trust shall have the status of an amendment to this
Declaration of Trust.
Any Trustee, officer or other agent of the Trust, and any organization in
which any such person is interested may acquire, own, hold and dispose of Shares
of any Sub-Trust (including any classes thereof) of the Trust to the same extent
as if such person were not a Trustee, officer or other agent of the Trust; and
the Trust may issue and sell or cause to be issued and sold and may purchase
Shares of any Sub-Trust (including any classes thereof) from any such person or
any such organization subject only to the general limitations, restrictions or
other provisions applicable to the sale or purchase of Shares of such Sub-Trust
(including any classes thereof) generally.
Section 4.2 ESTABLISHMENT AND DESIGNATION OF SUB-TRUSTS AND CLASSES.
Without limiting the authority of the Trustees set forth in Section 4.1 to
establish and designate any further Sub-Trusts, the Trustees hereby establish
and designate four Sub-Trusts: "MJI International, MJI Global Bond, Chicago
Asset Management Value Contrarian and Chicago Asset Management Intermediate-Term
Bond" which shall consist of a single class of Shares. The Shares of such Sub-
Trust and any Shares of any further Sub-Trust or class thereof that may from
time to time be established and designated by the Trustees shall (unless the
Trustees otherwise determine with respect to some further Sub-Trust at the time
of establishing and designating the same) have the following relative rights and
preferences:
(a) ASSETS BELONGING TO SUB-TRUSTS. All consideration received by the
Trust for the issue or sale of Shares of a particular Sub-Trust or any classes
thereof, together with all assets in which such consideration is invested or
reinvested, all income, earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets, and any
funds or payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall be held by the Trustees in trust for the benefit of
the holders of Shares of that Sub-Trust or class thereof and shall irrevocably
belong to that Sub-Trust (and be allocable to any classes thereof) for all
purposes, and shall be so recorded upon the books of account of the Trust.
Separate and distinct records shall be maintained for each Sub-Trust and the
assets associated with a Sub-Trust shall be held and accounted for separately
from the other assets of the Trust, or any other Sub-Trust. Such consideration,
assets, income, earnings, profits, and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation of such assets, and any funds or
payments derived from any reinvestment of such proceeds, in whatever form the
same may be, together with any General Items (as hereinafter defined) allocated
to that Sub-Trust as provided in the following sentence, are herein referred to
as "assets belonging to" that Sub-Trust (and allocable to any classes thereof).
In the event that there are any assets, income, earnings, profits, and proceeds
thereof, funds, or payments which are not readily identifiable as belonging to
any particular Sub-Trust (collectively "General Items"), the Trustees shall
allocate such General Items to and among any one or more of the Sub-Trusts
established and designated from time to time in such manner and on such basis as
they, in their sole discretion, deem fair and equitable; and any General Items
so
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allocated to a particular Sub-Trust shall belong to that Sub-Trust (and be
allocable to any classes thereof). Each such allocation by the Trustees shall be
conclusive and binding upon the holders of all Shares of all Sub-Trusts
(including any classes thereof) for all purposes.
(b) LIABILITIES BELONGING TO SUB-TRUSTS. The assets belonging to each
particular Sub-Trust shall be charged with the liabilities in respect of that
Sub-Trust and all expenses, costs, charges, and reserves belonging to that Sub-
Trust, and any general liabilities, expenses, costs, charges, or reserves of the
Trust which are not readily identifiable as belonging to any particular Sub-
Trust shall be allocated and charged by the Trustees to and among any one or
more of the Sub-Trusts established and designated from time to time in such
manner and on such basis as the Trustees in their sole discretion shall
determine. In addition, the liabilities in respect of a particular class of
Shares of a particular Sub-Trust and all expenses, costs, charges, and reserves
belonging to that class of Shares, and any general liabilities, expenses, costs,
charges or reserves of that particular Sub-Trust which are not readily
identifiable as belonging to any particular class of Shares of that Sub-Trust
shall be allocated and charged by the Trustees to and among any one or more of
the classes of Shares of that Sub-Trust established and designated from time to
time in such manner and on such basis as the Trustees in their sole discretion
shall determine. The liabilities, expenses, costs, charges, and reserves
allocated and so charged to a Sub-Trust or class thereof are herein referred to
as "liabilities belonging to" that Sub-Trust or class thereof. Each allocation
of liabilities, expenses, costs, charges, and reserves by the Trustees shall be
conclusive and binding upon the Shareholders, creditors and any other persons
dealing with the Trust or any Sub-Trust (including any classes thereof) for all
purposes. Any creditor of any Sub-Trust may look only to the assets of that
Sub-Trust to satisfy such creditor's debt. The Trustees shall have full
discretion, to the extent not inconsistent with the 1940 Act, to determine which
items shall be treated as income and which items as capital; and each such
determination and allocation shall be conclusive and binding upon the
shareholders.
(c) DIVIDENDS. Dividends and distributions on Shares of a particular
Sub-Trust or any class thereof may be paid with such frequency as the Trustees
may determine, which may be daily or otherwise pursuant to a standing resolution
or resolutions adopted only once or with such frequency as the Trustees may
determine, to the holders of Shares of that Sub-Trust or class, from such of the
income and capital gains, accrued or realized, from the assets belonging to that
Sub-Trust, or in the case of a class, belonging to that Sub-Trust and allocable
to that class, as the Trustees may determine, after providing for actual and
accrued liabilities belonging to that Sub-Trust or class. All dividends and
distributions on Shares of a particular Sub-Trust or class thereof shall be
distributed pro rata to the holders of Shares of that Sub-Trust or class in
proportion to the number of Shares of that Sub-Trust or class held by such
holders at the date and time of record established for the payment of such
dividends or distributions, except that in connection with any dividend or
distribution program or procedure the Trustees may determine that no dividend or
distribution shall be payable on Shares as to which the Shareholder's purchase
order and/or payment have not been received by the time or times established by
the Trustees under such program or procedure. Such dividends and distributions
may be made in cash or Shares of that Sub-Trust or class or a combination
thereof as determined by the Trustees or pursuant to any program that the
Trustees may have in effect at the time for the election by each Shareholder of
the mode of the making of such dividend or distribution to that Shareholder.
Any such dividend or distribution paid in Shares will be paid at the net asset
value thereof as determined in accordance with subsection (h) of this Section
4.2.
The Trustees shall have full discretion to determine which items shall be
treated as income and which items as capital; and each such determination and
allocation shall be conclusive and binding upon the Shareholders.
(d) LIQUIDATION. In the event of the liquidation or dissolution of
the Trust, subject to Section 7.1 hereof, the holders of Shares of each Sub-
Trust or any class thereof that has been established and designated shall be
entitled to receive, when and as declared by the Trustees, the excess of the
assets belonging to that Sub-Trust, or in the case of a class, belonging to that
Sub-Trust and allocable to that class, over the liabilities belonging to that
Sub-Trust or class. The assets so distributable to the holders of Shares of any
particular Sub-
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Trust or class thereof shall be distributed among such holders in
proportion to the number of Shares of that Sub-Trust or class thereof held by
them and recorded on the books of the Trust. The liquidation of any particular
Sub-Trust or class thereof may be authorized at any time by vote of a majority
of the Trustees then in office.
(e) VOTING. On each matter submitted to a vote of the Shareholders,
each holder of a Share shall be entitled to one vote for each whole Share
standing in his name on the books of the Trust irrespective of the Series
thereof or class thereof and all Shares of all Series and classes thereof shall
vote together as a single class; provided, however, that as to any matter (i)
with respect to which a separate vote of one or more Series or classes thereof
is required by the 1940 Act or the provisions of the writing establishing and
designating the Sub-Trust or class, such requirements as to a separate vote by
such Series or class thereof shall apply in lieu of all Shares of all Series and
classes thereof voting together; and (ii) as to any matter which affects the
interests of one or more particular Series or classes thereof, only the holders
of Shares of the one or more affected Series or classes shall be entitled to
vote, and each such Series or class shall vote as a separate class.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of a particular Sub-
Trust or any class thereof shall have the right at such times as may be
permitted by the Trust to require the Trust to redeem all or any part a of his
Shares of that Sub-Trust or class thereof at a redemption price equal to the net
asset value per Share of that Sub-Trust or class thereof next determined in
accordance with subsection (h) of this Section 4.2 after the Shares are properly
tendered for redemption, subject to any contingent deferred sales charge or
redemption charge in effect at the time of redemption. Payment of the redemption
price shall be in cash; provided, however, that if the Trustees determine, which
determination shall be conclusive, that conditions exist which make payment
wholly in cash unwise or undesirable, the Trust may, subject to the requirements
of the 1940 Act, make payment wholly or partly in securities or other assets
belonging to the Sub-Trust of which the Shares being redeemed are part at the
value of such securities or assets used in such determination of net asset
value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of any Sub-
Trust or class thereof to require the Trust to redeem Shares of that Sub-Trust
during any period or at any time when and to the extent permissible under the
1940 Act.
(g) REDEMPTION BY TRUST. Each Share of each Sub-Trust or class thereof
that has been established and designated is subject to redemption by the Trust
at the redemption price which would be applicable if such Share was then being
redeemed by the Shareholder pursuant to subsection (f) of this Section 4.2: (i)
at any time, in the sole discretion of the Trustees, or (ii) upon such other
conditions as may from time to time be determined by the Trustees and set forth
in the then current Prospectus or Statement of Additional Information of the
Trust. Upon such redemption the holders of the Shares so redeemed shall have no
further right with respect thereto other than to receive payment of such
redemption price.
(h) NET ASSET VALUE. The net asset value per Share of any Sub-Trust shall
be (i) in the case of a Sub-Trust whose Shares are not divided into classes, the
quotient obtained by dividing the value of the net assets of that Sub-Trust
(being the value of the assets belonging to that Sub-Trust less the liabilities
belonging to that Sub-Trust) by the total number of Shares of that Sub-Trust
outstanding, and (ii) in the case of a class of Shares of a Sub-Trust whose
Shares are divided into classes, the quotient obtained by dividing the value of
the net assets of that Sub-Trust allocable to such class (being the value of the
assets belonging to that Sub-Trust allocable to such class less the liabilities
belonging to such class) by the total number of Shares of such class
outstanding; all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by the
Trustees from time to time.
The Trustees may determine to maintain the net asset value per Share of any
Sub-Trust at a designated constant dollar amount and in connection therewith may
adopt procedures not inconsistent with the 1940 act for the continuing
declarations of income attributable to that Sub-Trust as dividend payable in
additional shares
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of the Sub-Trust at the designated constant dollar amount and for the handling
of any losses attributable to that Sub-Trust. Such procedures may provide that
in the event of any loss each Shareholder shall be deemed to have contributed to
the capital of the Trust attributable to that Sub-Trust his pro rata portion of
the total number of Shares required to be canceled in order to permit the net
asset value per Share of that Sub-Trust to be maintained, after reflecting such
loss, at the designated constant dollar amount. Each Shareholder of the Trust
shall be deemed to have agreed, by his investment in any Sub-Trust with respect
to which the Trustees shall have adopted any such procedure, to make the
contribution referred to in the preceding sentence in the event of any such
loss.
(i) TRANSFER. All Shares of each particular Sub-Trust or class thereof
shall be transferable, but transfers of Shares of a particular Sub-Trust or
class thereof will be recorded on the Share transfer records of the Trust
applicable to that Sub-Trust or class only at such times as Shareholders shall
have the right to require the Trust to redeem Shares of that Sub-Trust or class
and at such other times as may be permitted by the Trustees.
(j) EQUALITY. Except as provided herein or in the instrument designating
and establishing any class of Shares or any Sub-Trust, all Shares of each
particular Sub-Trust or class thereof shall represent an equal proportionate
interest in the assets belonging to that Sub-Trust, or in the case of a class,
belonging to that Sub-Trust and allocable to that class, subject to the
liabilities belonging to that Sub-Trust or class and each share of any
particular Sub-Trust or class shall be equal to each other Share of that Sub-
Trust or class; but the provisions of this sentence shall not restrict any
distinctions permissible under subsection (c) of this Section 4.2 that may exist
with respect to dividends and distributions on Shares of the same Sub-Trust or
class. The Trustees may from time to time divide or combine the Shares of any
particular Sub-Trust or class into a greater or lesser number of Shares of that
Sub-Trust or class without thereby changing the proportionate beneficial
interest in the assets belonging to that Sub-Trust or class or in any way
affecting the rights of Shares of any other Sub-Trust or class.
(k) FRACTIONS. Any fractional Share of any Sub-Trust or class, if any such
fractional Share is outstanding, shall carry proportionately all the rights and
obligations of a whole Share of that Sub-Trust or class, including rights and
obligations with respect to voting, receipt of dividends and distributions,
redemption of Shares, and liquidation of the Trust.
(l) CONVERSION OR EXCHANGE RIGHTS. Subject to compliance with the
requirements of the 1940 Act, the Trustees shall have the authority to provide
that holders of Shares of any Sub-Trust or class thereof shall have the right to
convert or exchange said Shares into Shares of one or more other Sub-Trust or
class thereof in accordance with such requirements and procedures as may be
established by the Trustees.
(m) CLASS DIFFERENCES. Subject to Section 4.1, the relative rights and
preferences of the classes of any Sub-Trust may differ in such other respects as
the Trustees may determine to be appropriate in their sole discretion, provided
that such differences are set forth in the instrument establishing and
designating such classes and executed by a majority of the Trustees (or by an
instrument executed by an officer of the Trust pursuant to a vote of a majority
of the Trustees).
Section 4.3 OWNERSHIP OF SHARES. The ownership of Shares shall be
recorded on the books of the Trust or of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Shares of each Sub-
Trust and each class thereof that has been established and designated. No
certificates certifying the ownership of Shares need be issued except as the
Trustees may otherwise determine from time to time. The trustees may make such
rules as they consider appropriate for the issuance of Share certificates, the
use of facsimile signature, the transfer of Shares and similar matters. The
record books of the Trust as kept by the Trust or any transfer or similar agent,
as the case may be, shall be conclusive as to who are the Shareholders and as to
the number of Shares of each Sub-Trust and class thereof held from time to time
by each such Shareholder.
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Section 4.4 INVESTMENTS IN THE TRUST. The Trustees may accept
investments in the Trust and each Sub-Trust from such persons and on such terms
and for such consideration, not inconsistent with the provisions of the 1940
Act, as they from time to time authorize. The Trustees may authorize any
distributor, principal underwriter, custodian, transfer agent or other person to
accept orders for the purchase of Shares that conform to such authorized terms
and to reject any purchase orders for Shares whether or not conforming to such
authorized terms.
Section 4.5 NO PRE-EMPTIVE RIGHTS. Shareholders shall have no pre-
emptive or other rights to subscribe to any additional Shares or other
securities issued by the Trust or any Sub-Trust, except as the Trustees in their
sole discretion shall have determined by resolution.
Section 4.6 STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY.
Shares shall be deemed to be personal property giving only the rights provided
in this Declaration of Trust. Every Shareholder by virtue of acquiring Shares
shall be held to have expressly assented and agreed to the terms hereof and to
have become a party hereto. The death, incapacity, dissolution, termination, or
bankruptcy of a Shareholder during the continuance of the Trust shall not
operate to dissolve or terminate the Trust or any Sub-Trust thereof nor entitle
the representative of such Shareholder to an accounting or to take any action in
court or elsewhere against the Trust or the Trustees, but only to the rights of
such Shareholder under this Trust. Ownership of Shares shall not entitle the
Shareholder to any title in or to the whole or any part of the Trust property or
right to call for a partition or division of the same or for an accounting, nor
shall the ownership of Shares constitute the Shareholders partners. Neither the
Trust nor the Trustees nor any officer, employee or agent of the Trust shall
have any power to bind personally any Shareholder, nor except as specifically
provided herein to call upon any Shareholder for the payment of any sum of money
or assessment whatsoever other than such as the Shareholder may at any time
personally agree to pay.
Section 4.7 NO APPRAISAL RIGHTS. Shareholders shall have no right to
demand payment for their shares or to any other rights of dissenting
shareholders in the event the Trust participates in any transaction which would
give rise to appraisal or dissenters' rights by a shareholder of a corporation
organized under the General Corporation Law of the State of Delaware, or
otherwise.
ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 VOTING POWERS. The Shareholders shall have power to vote
only (i) for the election of Trustees as provided in Section 3.1, (ii) with
respect to any contract with a Contracting Party as provided in Section 3.3 as
to which Shareholder approval is required by the 1940 Act, (iii) with respect to
any termination or reorganization of the Trust to the extent and as provided in
Sections 7.1 and 7.2, (iv) with respect to any amendment of this Declaration of
Trust to the extent and as provided in Section 7.3, and (v) with respect to such
additional matters relating to the Trust as may be required by the 1940 act,
this Declaration of Trust, the By-Laws or any registration of the Trust with the
Commission (or any successor agency) or any state, or as the Trustees may
consider necessary or desirable. There shall be no cumulative voting in the
election of Trustees. Shares may be voted in person or by proxy. Proxies may be
given orally or in writing or pursuant to any computerized or mechanical data
gathering process specifically approved by the Trustees. A proxy with respect to
Shares held in the name of two or more persons shall be valid if executed by any
one of them unless at or prior to exercise of the proxy the Trust receives a
specific written notice to the contrary from any one of them. A proxy purporting
to be executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise and the burden of proving invalidity
shall rest on the challenger. At any time when no Shares of a Series are
outstanding, the Trustees may exercise all rights of Shareholders of that Series
with respect to matters affecting that Series and may take any action required
by law, this Declaration of Trust, or the By-Laws to be taken by Shareholders.
Section 5.2 MEETINGS. No annual or regular meeting of Shareholders is
required. Special meetings of Shareholders may be called by the Trustees from
time to time for the purpose of electing Trustees
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as herein provided and for such other purposes as may be prescribed by law, this
Declaration of Trust or the By-Laws, or for taking action upon any other matter
deemed by the Trustees to be necessary or desirable. Written notice of any
meeting of Shareholders shall be given or caused to be given by the Trustees by
mailing such notice at least seven days before such meeting, postage prepaid,
stating the time, place, and purpose of the meeting, to each Shareholder at the
Shareholder's address as it appears on the record of the Trust. Whenever notice
of a meeting is required to be given to a Shareholder under the Declaration of
Trust or the By-Laws, a written waiver thereof, executed before or after the
meeting by such Shareholder or his attorney thereunto authorized and filed with
the records of the meeting, shall be deemed equivalent to such notice.
Section 5.3 RECORD DATES. For the purpose of determining the
Shareholders who are entitled to vote or act at any meeting or any adjournment
thereof, or who are entitled to participate in any dividend or distribution, or
for the purpose of any other action, the Trustees may from time to time close
the transfer books for such period, not exceeding 30 days (except at or in
connection with the termination of the Trust), as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date and time not more
than 90 days prior to the date of any meeting of Shareholders or other action as
the date and time of record for the determination of Shareholders entitled to
vote at such meeting or any adjournment thereof or to be treated as Shareholders
of record for purposes of such other action, and any Shareholder who was a
Shareholder at the date and time so fixed shall be entitled to vote at such
meeting or any adjournment thereof or to be treated as a Shareholder of record
for purposes of such other action, even though he has since that date and time
disposed of his Shares, and no Shareholder becoming such after that date and
time shall be so entitled to vote at such meeting or any adjournment thereof or
to be treated as a Shareholder of record for purposes of such other action.
Nothing in this section shall be construed as precluding the Trustees from
setting different record dates for different Sub-Trusts.
Section 5.4 QUORUM AND REQUIRED VOTE. Except as otherwise provided by
the 1940 Act or other applicable law, thirty percent of the Shares entitled to
vote shall be a quorum for the transaction of business at a Shareholders'
meeting. Any meeting of shareholders, whether or not a quorum is present, may be
adjourned from time to time by the majority of the Shares represented at the
meeting, either in person or by proxy. Any adjourned session or sessions may be
held, within a reasonable time after the date set for the original meeting
without the necessity of notice of the adjourned meeting or of the business to
be transacted at an adjourned meeting, other than by announcement at the meeting
at which the adjournment is taken, unless the Trustees fix a new record date for
the adjourned meeting. A majority of the Shares voted, at a meeting of which a
quorum is present, shall decide any questions and a plurality shall elect a
Trustee, except when a different vote is required or permitted by any provision
of the 1940 Act or other applicable law or by this Declaration of Trust or the
By-Laws.
Section 5.5 ACTION BY WRITTEN CONSENT. Subject to the provisions of the
1940 Act and other applicable law, any action taken by Shareholders may be taken
without a meeting if a majority of Shareholders entitled to vote on the matter
(or such larger proportion thereof as shall be required by the 1940 Act or by
any express provision of this Declaration of Trust or the By-Laws) consent to
the action in writing and such written consents are filed with the record of the
meetings of Shareholders. Such consent shall be treated for all purposes as a
vote taken at a meeting of Shareholders.
Section 5.6 INSPECTION OF RECORDS. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
stockholders of a Delaware corporation under the Delaware General Law.
Section 5.7 ADDITIONAL PROVISIONS. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE VI
LIMITATION OF LIABILITY; INDEMNIFICATION
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Section 6.1 TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE.
All persons extending credit to, contracting with or having any claim against
the Trust shall look only to the assets of the Sub-Trust with which such person
dealt for payment under such credit, contract or claim; and neither the
Shareholders of any Sub-Trust nor the Trustees, nor any of the Trust's officers,
employees or agents, whether past, present or future, nor any other Sub-Trust
nor the Trustees, nor any of the Trust's officers, employees or agents, whether
past, present or future, nor any other Sub-Trust shall be personally liable
therefor. Every note, bond, contract, instrument, certificate, or undertaking
and every act or thing whatsoever executed or done by or on behalf of the Trust,
any Sub-Trust or the Trustees or any of them in connection with the Trust shall
be conclusively deemed to have been executed or done only by or for the Trust
(or the Sub-Trust) or the Trustees and not personally. The Trustees and the
Trust's officers, employees and agents shall not be liable to the Trust or the
Shareholders; provided however, that nothing in this Declaration of Trust shall
protect any Trustee or officer, employee or agent against any liability to the
Trust or the Shareholders to which such Trustee or officer, employee or agent
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee or of such officer, employee or agent.
Every note, bond, contract, instrument, certificate, or undertaking made or
issued by the Trustees or by any officers or officer shall give notice that the
same was executed or made by or on behalf of the Trust or by them as Trustees or
Trustee or as officers or officer and not individually and that the obligations
of such instrument are not binding upon any of them or the Shareholders
individually but are binding only upon the assets and property of the Trust, or
the particular Sub-Trust in question, as the case may be, but the omission
thereof shall not operate to bind any Trustees or Trustee or officers or officer
or Shareholders or Shareholder individually or otherwise invalidate any such
note, bond, contract, instrument, certificate, or undertaking.
Section 6.2 TRUSTEE'S GOOD FAITH ACTION; EXPERT ADVICE; NO BOND OR
SURETY. The exercise by the Trustees of their powers and discretion hereunder
shall be binding upon everyone interested. A Trustee shall be liable to the
Trust and the Shareholders for his own willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee, and for nothing else, and shall not be liable for errors of
judgment or mistakes of fact or law. Subject to the foregoing, (a) the Trustees
shall not be responsible or liable in any event for any neglect or wrongdoing of
any officer, agent, employee, consultant, adviser, administrator, distributor or
principal underwriter, custodian or transfer, dividend disbursing, Shareholder
servicing or accounting agent of the Trust, nor shall any Trustee be responsible
for the act or omission of any other Trustee; (b) the Trustees may take advice
of counsel or other experts with respect to the meaning and operation of this
Declaration of Trust and their duties as Trustees, and shall be under no
liability for any act or omission in accordance with such advice or for failing
to follow such advice; and (c) in discharging their duties, the Trustees, when
acting in good faith, shall be entitled to rely upon the books of account of the
Trust and upon written reports made to the Trustees by any officer appointed by
them, any independent public accountant, and (with respect to the subject matter
of the contract involved) any officer, partner, or responsible employee of a
Contracting Party appointed by the Trustees pursuant to Section 3.3. The
Trustees as such shall not be required to give any bond or surety or any other
security for the performance of their duties. To the extent that, at law or in
equity, a Trustee has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to a shareholder any such Trustee acting under
this Declaration of Trust shall not be liable to the Trust or to any such
Shareholder for the Trustee's good faith reliance on the provisions of this
Declaration of Trust. The provisions of this Declaration of Trust, to the extent
that they restrict the duties and liabilities of a Trustee otherwise existing at
law or in equity, are agreed by the Shareholders to replace such other duties
and liabilities of such Trustee.
Section 6.3 INDEMNIFICATION OF SHAREHOLDERS. In case any Shareholder (or
former Shareholder) of any Sub-Trust of the Trust shall be charged or held to be
personally liable for any obligation or liability of the Trust solely by reason
of being or having been a Shareholder and not because of such Shareholder's acts
or omissions or for some other reason, the Trust on behalf of said Sub-Trust
(upon proper and timely request by the Shareholder) shall assume the defense
against such charge and satisfy any judgment thereon, and, to the
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fullest extent permitted by law, the Shareholder or former Shareholder (or his
heirs, executors, administrators, or other legal representatives or in the case
of a corporation or other entity, its corporate or other general successor)
shall be entitled out of the assets of said Sub-Trust estate to be held harmless
from and indemnified against all loss and expense arising from such liability.
Section 6.4 INDEMNIFICATION OF TRUSTEES, OFFICERS, ETC. To the fullest
extent permitted by law, the Trust shall indemnify (from the assets of the Sub-
Trust or Sub-Trusts in question) each of its Trustees and officers (including
persons who serve at the Trust's request as directors, officers, or trustees of
another organization in which the Trust has any interest as a shareholder,
creditor or otherwise) (hereinafter referred to as a "Covered Person") against
all liabilities including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit, or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter by reason of any alleged act or
omission as a Trustee or officer or, by reason of being or having been such a
Trustee or officer, director or trustee, except with respect to any matter as to
which it has been determined that such Covered Person had acted with willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's office (such conduct referred
to hereafter as "Disabling Conduct"). A determination that the Covered Person is
entitled to indemnification may be made by (i) a final decision on the merits by
a court or other body before whom the proceeding was brought that the person to
be indemnified was not liable by reason of Disabling Conduct, (ii) dismissal of
a court action or an administrative proceeding against a Covered Person for
insufficiency of evidence of Disabling Conduct, or (iii) a reasonable
determination, based upon a review of the facts, that the Covered Person was not
liable by reason of Disabling Conduct by (a) a vote of a majority of a quorum of
Trustees who are neither "interested persons" of the Trust as defined in section
2(a)(19) of the 1940 Act nor parties to the proceeding, or (b) an independent
legal counsel in a written opinion. Expenses, including accountants' and counsel
fees so incurred by any such Covered Person (but excluding amounts paid in
satisfaction of judgments, in compromise, or as fines or penalties), may be paid
from time to time from funds attributable to the Sub-Trust in question in
advance of the final disposition of any such action, suit, or proceeding,
provided that the Covered Person shall have undertaken to repay the amounts so
paid to the Sub-Trust in question if it is ultimately determined that
indemnification of such expenses is not authorized under this Article VI and (i)
the Covered Person shall have provided security for such undertaking, (ii) the
Trust shall be insured against losses arising by person of any lawful advances,
or (iii) a majority of a quorum of the disinterested Trustees who are not a
party to the proceeding, or an independent legal counsel in a written opinion,
shall have determined, based on a review of readily available facts (as opposed
to a full trial-type inquiry), that there is reason to believe that the Covered
Person ultimately will be found entitled to indemnification.
Section 6.5 COMPROMISE PAYMENT. As to any matter disposed of by a
compromise payment by any such Covered Person referred to in Section 6.4,
pursuant to a consent decree or otherwise, no such indemnification either for
said payment or for any other expenses shall be provided unless such
indemnification shall be approved (a) by a majority of the disinterested
Trustees who are not parties to the proceeding or (b) by an independent legal
counsel in a written opinion. Approval by the Trustees pursuant to clause (a) or
by independent legal counsel pursuant to clause (b) shall not prevent the
recovery from any Covered Person of any amount paid to such Covered Person in
accordance with any of such clauses as indemnification if such Covered Person is
subsequently adjudicated by a court of competent jurisdiction to have been
liable to the Trust or its Shareholders by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of the duties involved in the
conduct of such Covered Person's office.
Section 6.6 INDEMNIFICATION NOT EXCLUSIVE, ETC. The right of
indemnification provided by this Article VI shall not be exclusive of or affect
any other rights to which any such Covered Person may be entitled. As used in
this Article VI, "Covered Person" shall include such person's heirs, executors,
and administrators; an "interested Covered Person" is one against whom the
action, suits, or other proceeding in
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question or another action, suit, or other proceeding on the same or similar
grounds is then or has been pending or threatened; and a "disinterested" person
is a person against whom none of such actions, suits or other proceedings or
another action, suit or other proceeding on the same or similar grounds is then
or has been pending or threatened. Nothing contained in this Article shall
affect any rights to indemnification to which personnel of the Trust, other than
Trustees and officers, and other persons may be entitled by contract or
otherwise under law, nor the power of the Trust to purchase and maintain
liability insurance on behalf of any such person.
Section 6.7 LIABILITY OF THIRD PERSONS DEALING WITH TRUSTEES. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees or to see to the
application of any payments made or property transferred to the Trust or upon
its order.
Section 6.8 DISCRETION. Whenever in this Declaration of Trust the
Trustees are permitted or required to make a decision (a) in their "sole
discretion," "sole and absolute discretion," "full discretion," or "discretion,"
or under a similar grant of authority or latitude, the Trustees shall be
entitled to consider only such interests and factors as they desire, whether
reasonable or unreasonable, and may consider their own interests, and shall have
no duty or obligation to give any consideration to any interests of or factors
affecting the Trust or the Shareholders, or (b) in their "good faith" or under
another express standard, the Trustees shall act under such express standard and
shall not be subject to any other or different standards imposed by this
Declaration of Trust or by law or any other agreement contemplated herein. Each
Shareholder and Trustee hereby agrees that any standard of care or duty imposed
in this Declaration of Trust or any other agreement contemplated herein or under
the Act or any other applicable law, rule or regulation shall be modified,
waived, or limited in each case as required to permit the Trustees to act under
this Declaration of Trust or any other agreement contemplated herein and to make
any decision pursuant to the authority prescribed in this Declaration of Trust.
ARTICLE VII
MISCELLANEOUS
Section 7.1 DURATION AND TERMINATION OF TRUST. Unless terminated as
provided herein, the Trust shall continue without limitation of time and,
without limiting the generality of the foregoing, no change, alteration or
modification with respect to any Sub-Trust or class thereof shall operate to
terminate the Trust. The Trust may be terminated at any time by a Majority of
the Outstanding Voting Shares of the Trust or by the Trustees by written notice
to the Shareholders.
Upon termination, after paying or otherwise providing for all charges,
taxes, expenses and liabilities, whether due to accrued or anticipated as may be
determined by the Trustees, the Trust shall in accordance with such procedures
as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash, securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with the
provisions of subsection (d) of Section 4.2.
Section 7.2 REORGANIZATION. The Trustees may sell, convey, merge, and
transfer the assets of the Trust, or the assets belonging to any one or more
Sub-Trusts, to another trust, partnership, association, or corporation organized
under the laws of any state of the United States, or to the Trust to be held as
assets belonging to another Sub-Trust of the Trust in exchange for cash, shares
or other securities (including, in the case of a transfer to another Sub-Trust
of the Trust, Shares of such other Sub-Trust or any class thereof) with such
transfer either (1) being made subject to, or with the assumption by the
transferee of, the liabilities belonging to each Sub-Trust the assets of which
are so transferred, or (2) not being made subject to, or not with the assumption
of, such liabilities; provided, however, that no assets belonging to any
particular Sub-Trust shall be so transferred unless the terms of such transfer
shall have first been approved at a meeting called for the purpose by the
affirmative vote of the holders of a Majority of the Outstanding Voting Shares
of that Sub-
18
<PAGE>
Trust. Following such transfer, the Trustees shall distribute such cash, shares,
or other securities among the Shareholders of the Sub-Trust (taking into account
the differences among the classes of Shares thereof, if any) the assets
belonging to which have been so transferred; and if all of the assets of the
Trust have been so transferred, the Trust shall be terminated.
The Trust, or any one or more Sub-Trusts, may either as the successor,
survivor, or non-survivor, (1) consolidate with one or more other trusts,
partnerships, limited liability companies, associations, or corporations
organized under the laws of the State of Delaware or any other state of the
United States, to form a new consolidated trust, partnership, association or,
corporation under the laws of which any one of the constituent entities is
organized, or (2) merge into or transfer a substantial portion of its assets to
one or more other trusts, partnerships, associations, or corporations organized
under the laws of the State of Delaware or any other state of the United States,
or have one or more such trusts, partnerships, associations, or corporations
merged into or transfer a substantial portion of its assets to it, any such
consolidation as are specified in an agreement and plan of reorganization
entered into by the Trust, or one or more Sub-Trusts as the case may be, in
connection therewith. Any such consolidation, merger or transfer shall require
the affirmative vote of the holders of a Majority of the Outstanding Voting
Shares of the Trust (or each Sub-Trust affected thereby, as the case may be),
except that such affirmative vote of the holders of Shares shall not be required
if the Trust (or Sub-Trust affected thereby, as the case may be) shall be the
survivor of such consolidation or merger or transferee of such assets.
Section 7.3 AMENDMENTS. All rights granted to the Shareholders under
this Declaration of Trust are granted subject to the reservation of the right to
amend this Declaration of Trust as herein provided, except that no amendment
shall repeal the limitations on personal liability of any Shareholder or Trustee
or repeal the prohibition of assessment upon the Shareholders without the
express consent of each Shareholder or Trustee involved. Subject to the
foregoing, the provisions of this Declaration of Trust (whether or not related
to the rights of Shareholders) may be amended at any time, so long as such
amendment does not adversely affect the rights of any Shareholder with respect
to which such amendment is or purports to be applicable and so long as such
amendment is not in contravention of applicable law, including the 1940 Act, by
an instrument in writing signed by a majority of the then Trustees (or by an
officer of the Trust pursuant to the vote of a majority of such Trustees). Any
amendment to this Declaration of Trust that adversely affects the rights of
Shareholders may be adopted at any time by an instrument in writing signed by a
majority of the then Trustees (or by an officer of the Trust pursuant to a vote
of a majority of such Trustees) when authorized to do so by the vote in
accordance with subsection (e) of Section 4.2 of Shareholders holding a majority
of the Shares entitled to vote. Without limiting the generality of the
foregoing, amendments having the purposes of changing the name of the Trust or
any Sub-Trust or of supplying any omission, curing or curing, correcting or
supplementing any defective or inconsistent provision contained herein shall not
require authorization by Shareholder vote. Subject to the provisions of this
Section 7.3, any amendment shall be effective as provided in the instrument
containing the terms of such amendment or, if there is no provision therein with
respect to effectiveness, upon the execution of such instrument and of a
certificate (which may be a part of such instrument) executed by a Trustee or
officer of the Trust to the effect that such amendment has been duly adopted.
Section 7.4 FILING OF COPIES; REFERENCES; HEADINGS. The original or a
copy of this instrument and of each amendment hereto shall be kept at the office
of the Trust where it may be inspected by any Shareholder. Anyone dealing with
the Trust may rely on a certificate by an officer of the Trust as to whether or
not any such amendments have been made, as to the identities of the Trustees and
officers, and as to any matters in connection with the Trust hereunder; and,
with the same effect as if it were the original, may rely on a copy certified by
an officer of the Trust to be a copy of this instrument or of any such
amendments. In this instrument and in any such amendment, references to this
instrument, and all expressions like "herein", "hereof", and "hereunder" shall
be deemed to refer to this instrument as a whole as the same may be amended or
affected by any such amendments. The masculine gender shall include the feminine
and neuter genders. Headings are placed herein for convenience of reference only
and shall not be taken as a part hereof or control or affect the meaning,
construction, or effect of this instrument. This instrument may be executed in
any number of counterparts each of which shall be deemed an original.
19
<PAGE>
Section 7.5 APPLICABLE LAW. This Declaration of Trust is created under
and is to be governed by the State of Delaware. The Trust shall be of the type
referred to in Section 3801 of the Delaware Business Trust Act and of the type
commonly called a business trust, and without limiting the provisions hereof,
the Trust may exercise all powers which are ordinarily exercised by such a
trust.
Section 7.6 REGISTERED AGENT. Corporation Service Company is hereby
designated as the initial registered agent for service of process on the Trust
in Delaware. The address of the registered office of the Trust in the State of
Delaware is 1013 Centre Road, in the City of Wilmington, County of New Castle
19805.
Section 7.7 INTEGRATION. This Declaration of Trust constitutes the
entire agreement among the parties hereto pertaining to the subject matter
hereof and supersedes all prior agreements and understandings pertaining
thereto.
IN WITNESS WHEREOF, the undersigned hereunto set their hand and seal in
Boston, Massachusetts for themselves and their assigns, as of the day and year
first above written.
/s/ Norton H. Reamer
--------------------
Norton H. Reamer
/s/ John T. Bennett, Jr.
------------------------
John T. Bennett, Jr.
/s/ J. Edward Day
-----------------
J. Edward Day
/s/ Philip D. English
---------------------
Philip D. English
/s/ William A. Humenuk
----------------------
William A. Humenuk
/s/ Robert B. Russell, II
-------------------------
Robert B. Russell, II
/s/ Peter M .Whitman
--------------------
Peter M. Whitman
20
<PAGE>
The foregoing instrument was acknowledged before me this 26th day of April,
1994 by _______________of Boston, Massachusetts and _____________ of Boston,
Massachusetts.
Notary Public
[Notarial Seal]
My commission expires:
21
<PAGE>
Exhibit A.2.
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 05/18/1994
944088394 2403833
CERTIFICATE OF TRUST OF THE REGIS FUND II
This Certificate of Trust of The Regis Fund II (the "Trust"), dated
April 26, 1994, is filed in accordance with the provisions of the Delaware
Business Trust Act (12 Del. C. Section 3801 et seq.) and sets forth the
following:
FIRST: The name of the business trust formed hereby is The Regis Fund II.
SECOND: The business address of the registered office of the Trust in the State
of Delaware is 1013 Centre Road, in the City of Wilmington, County of New
Castle, 19805. The name of the Trust's registered agent at that address is
Corporation Service Company.
THIRD: This Certificate of Trust shall be effective upon the date and time of
filing.
FOURTH: Series Trust. Notice is hereby given that pursuant to Section 3804 of
the Delaware Business Trust Act, the debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a
particular series of the Trust shall be enforceable against the assets of such
series only and not against the assets of the Trust generally. The Trust will
be a registered investment company under the Investment Company Act of 1940, as
amended.
<PAGE>
IN WITNESS WHEREOF, the undersigned, being the Chairman of the Board
of Trustees of the Trust, has executed this Certificate of Trust in Boston,
Massachusetts as of the date first written above.
/s/ Norton H. Reamer
----------------------------------
Norton H. Reamer
-2-
<PAGE>
Exhibit A.3.
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF TRUST
OF
THE REGIS FUND II
Pursuant to Sections 3810(b)(1) and 3811(a)(2) of the Delaware
Business Trust Act, as amended, the undersigned hereby certifies that:
1. The name of the business trust is THE REGIS FUND II (the
"Trust").
2. Article FIRST of the Certificate of Trust of the Trust shall be
amended to provide as follows:
FIRST: The name of the business trust is "UAM FUNDS TRUST."
3. The effective date of this Certificate of Amendment is October
31, 1995.
IN WITNESS WHEREOF, the undersigned, being a trustee of the Trust, has
duly executed this Certificate of Amendment this 26th day of October, 1995.
THE REGIS FUND II
/s/ Norton H. Reamer
Norton H. Reamer, Trustee
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 10/31/1995
950251251 - 2403833
-3-
<PAGE>
EXHIBIT B.
BY-LAWS
OF
THE REGIS FUND II
ARTICLE 1
---------
Agreement and Declaration of Trust
and Principal Office
1.1 AGREEMENT AND DECLARATION OF TRUST. These By-Laws shall be subject to
the Agreement and Declaration of Trust, as from time to time in effect
("Declaration of Trust"), of The Regis Fund II, the Delaware business trust
established by the Declaration of Trust (the "Trust").
1.2 PRINCIPAL OFFICE OF THE TRUST. The principal office of the Trust shall be
located at One International Place, Boston, Massachusetts 02110.
ARTICLE 2
---------
MEETING OF TRUSTEES
2.1 REGULAR MEETINGS. Regular meetings of the Trustees may be held without
call or notice at such places either within or without the State of Delaware and
at such times as the Trustees may from time to time determine, provided that
notice of the first regular meeting following any such determination shall be
given to absent Trustees.
2.2 SPECIAL MEETINGS. Special meetings of the Trustees may be held at any time
and at any place designated in the call of the meeting when called by the
Chairman of the Board, the President or the Treasurer or by two or more
Trustees, sufficient notice thereof being given to each Trustee by the Secretary
or an Assistant Secretary or by the officer or the Trustees calling the meeting.
2.3 NOTICE. It shall be sufficient notice to a Trustee of a special meeting to
send notice by mail at least forty-eight hours or by telegram at least twenty-
four hours before the meeting addressed to the Trustee at his or her usual or
last known business or residence address or to give notice to him or her in
person or by telephone at least twenty-four hours before the meeting. Notice of
a meeting need not be given to any Trustee if a written waiver of notice,
executed by him or her before or after the meeting, is filed with the records of
the meeting, or to any Trustee who attends the meeting without protesting prior
thereto or at its commencement the lack of notice to him or her. Neither notice
of a meeting nor a waiver of a notice need specify the purposes of the meeting.
2.4 QUORUM; ADJOURNMENT: VOTE REQUIRED FOR ACTION. At any meeting of the
Trustees a majority of the Trustees then in office shall constitute a quorum. A
meeting at which a quorum is initially present may continue to transact business
notwithstanding the withdrawal of Trustees, if any action taken is approved by a
majority of the required quorum for such meeting. Any meeting may be adjourned
from time to time by a majority of the votes cast upon the question, whether or
not a quorum is present, and the meeting may be held as adjourned without
further notice. At the adjourned meeting, the Trustees may transact any
business which might have been transacted at the original meeting. Except in
cases where
1
<PAGE>
the Declaration of Trust or these By-Laws otherwise provide, the vote of a
majority of the Trustees present at a meeting at which a quorum is present shall
be the act of the Trustees.
2.5 ACTION BY WRITING. Except as required by law, any action required or
permitted to be taken at any meeting of the Trustees may be taken without a
meeting if a majority of the Trustees (or such larger proportion thereof as
shall be required by any express provision of the Declaration of Trust or these
By-Laws) consent to the action in writing and such written consents are filed
with the records of the meeting of Trustees. Such consent shall be treated for
all purposes as a vote taken at a meeting of Trustees.
2.6 PARTICIPATION BY COMMUNICATIONS EQUIPMENT. One or more of the Trustees or
of any committee of the Trustees may participate in a meeting thereof by means
of a conference telephone or similar communications equipment allowing all
persons participating in the meeting to hear each other at the same time.
Participation by such means shall constitute presence in person at a meeting.
ARTICLE 3
---------
Officers
3.1 ENUMERATION; QUALIFICATION. The officers of the Trust shall be a Chairman
of the Board, a President, a Treasurer, a Secretary and such other officers,
including Vice Presidents, if any, as the Trustees from time to time may in
their discretion elect. The Trust may also have such agents as the Trustees
from time to time may in their discretion appoint. The Chairman of the Board
shall be a Trustee and may, but need not be, a beneficial owner of the Trust (a
"Shareholder'); and any other officer may be but none need be a Trustee or
Shareholder. Any two or more offices may be held by the same person.
3.2 ELECTION; TENURE. The Chairman of the Board, the President, the Treasurer,
the Secretary and such other officers as the Trustees may in their discretion
from time to time elect shall hold office until their respective successors are
chosen and qualified, or in each case until he or she sooner dies, resigns, is
removed or becomes disqualified. Each officer shall hold office and each agent
shall retain authority at the pleasure of the Trustees.
3.3 POWERS. Subject to the other provisions of these By-Laws, each officer
shall have, in addition to the duties and powers herein and in the Declaration
of Trust set forth, such duties and powers as are commonly incident to the
office occupied by him or her as if the Trust were organized as a Delaware
business corporation and such other duties and powers as the Trustees may from
time to time designate.
3.4 CHAIRMAN. Unless the Trustees otherwise provide, the Chairman of the
Board, shall preside at all meetings of Trustees and exercise and perform such
other powers and duties as may be from time to time assigned to him or her by
the Trustees.
3.5 PRESIDENT. Unless otherwise provided by the Trustees, the President shall
be the Chief Executive Officer of the Trust and shall, subject to the control of
the Board of Trustees, have general supervision, direction and control of the
business of the Trust. The President shall preside at all meetings of
Shareholders and in the absence of the Chairman of the Board at all meetings of
the Board of Trustees.
3.6 VICE PRESIDENT. The Vice President, or if there be more than one Vice
President, the Vice Presidents in the order determined by the Trustees (or if
there be no such determination, then in the order of their election) shall in
the absence of the President or in the event of his or her inability or refusal
to act, perform the duties of the President, and when so acting, shall have all
the powers of and be subject to
2
<PAGE>
all the restrictions upon the President. The Vice Presidents shall perform such
other duties and have such other powers as the Trustees may from time to time
prescribe.
3.7 TREASURER. The Treasurer shall be the chief financial and accounting
officer of the Trust, and shall, subject to the provisions of the Declaration of
Trust and to any arrangement made by the Trustees with a custodian, investment
adviser or manager, or transfer, shareholder servicing or similar agent, be in
charge of the valuable papers, books of account and accounting records of the
Trust, and shall have such other duties and powers as may be designated from
time to time by the Trustees or by the President.
3.8 ASSISTANT TREASURER. The Assistant Treasurer, or if there shall be more
than one, the Assistant Treasurers in the order determined by the Trustees (or
if there be no such determination, then in the order of their election), shall,
in the absence of the Treasurer or in the event of his or her inability or
refusal to act, perform the duties and exercise the powers of the Treasurer and
shall perform such other duties and have such other powers as the Board of
Trustees may from time to time prescribe.
3.9 SECRETARY. The Secretary shall record all proceedings of the Shareholders
and the Trustees in books to be kept therefor, which books or a copy thereof
shall be kept at the principal office of the Trust. In the absence of the
Secretary from any meeting of the Shareholders or Trustees, an assistant
secretary, or if there be none or if he or she is absent, a temporary secretary
chosen at such meeting shall record the proceedings thereof in the aforesaid
books. The Secretary shall have such other duties and powers as the Trustees
may from time to time prescribe.
3.10 ASSISTANT SECRETARY. The Assistant Secretary, or if there be more than
one, the Assistant Secretaries in the order determined by the Trustees (or if
there be no determination, then in the order of their election), shall, in the
absence of the Secretary or in the event of his or her inability or refusal to
act, perform the duties and exercise the powers of the Secretary and shall
perform such other duties and have such other powers as the Board of Trustees
may from time to time prescribe.
3.11 RESIGNATIONS AND REMOVALS. Any Trustee or officer may resign at any time
by written instrument signed by him or her and delivered to the Chairman, the
Vice Chairman, the President or the Secretary or to a meeting of the Trustees.
Such resignation shall be effective upon receipt unless specified to be
effective at some other time. The Trustees may remove any officer elected by
them with or without cause. Except to the extent expressly provided in a
written agreement with the Trust, no Trustee or officer resigning and no officer
removed shall have any right to any compensation for any period following his or
her resignation or removal, or any right to damages on account of such removal.
ARTICLE 4
---------
Committees
4.1 GENERAL. The Trustees, by vote of a majority of the Trustees then in
office, may elect from their number an Executive Committee, Compensation
Committee, Audit Committee and Nomination Committee each of which shall consist
of two or more of the Trustee of the Trust which committee shall have and may
exercise some or all of the powers and authority of the Board with respect to
all matters except those which by law, by the Declaration of Trust, or by these
By-Laws may not be delegated.
4.2 OTHER COMMITTEES OF THE BOARD. The Board of Trustees may from time to
time, by resolution adopted by a majority of the whole Board, designate one or
more other committees of the Board, each such committee to consist of two or
more Trustees and to have such powers and duties as the Board of Trustees may,
by resolution, prescribe.
3
<PAGE>
4.3 LIMITATION OF COMMITTEE POWERS. No committee of the Board shall have power
or authority to:
(a) recommend to shareholders any action requiring authorization
of shareholders pursuant to statute or the Agreement and Declaration of Trust;
(b) approve or terminate any contract with an investment adviser
or principal underwriter, as such terms are defined in the 1940 Act, or take any
other action required to be taken by the Board of Trustees by the 1940 Act;
(c) amend or repeal these By-laws or adopt new By-laws;
(d) declare dividends or other distributions or issue capital
stock of the Trust; and
(e) approve any merger or share exchange which does not require
shareholder approval.
4.4 GENERAL. One-third, but not less than two members, of the members of any
committee shall be present in person at any meeting of such committee in order
to constitute a quorum for the transaction of business at such meeting, and the
act of a majority present shall be the act of such committee. The Board may
designate a chairman of any committee and such chairman or any two members of
any committee may fix the time and place of its meetings unless the Board shall
otherwise provide. In the absence or disqualification of any member or any
committee, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or she or they constitute a quorum,
may unanimously appoint another member of the Board of Trustees to act at the
meeting in the place of any such absent or disqualified member. The Board shall
have the power at any time to change the membership of any committee, to fill
all vacancies, to designate alternate members, to replace any absent or
disqualified member, or to dissolve any such committee.
All committees shall keep written minutes of their proceedings and shall
report such minutes to the Board. All such proceedings shall be subject to
revision or alteration by the Board; provided, however, that third parties shall
not be prejudiced by such revision or alteration.
ARTICLE 5
---------
Reports
5.1 GENERAL. The Trustees and officers shall render reports at the time and in
the manner required by the Declaration of Trust or any applicable law. Officers
and Committees shall render such additional reports as they may deem desirable
or as may from time to time be required by the Trustees.
ARTICLE 6
---------
Fiscal Year
6.1 GENERAL. The fiscal year of the Trust shall be fixed by resolution of the
Trustees.
4
<PAGE>
ARTICLE 7
---------
Seal
7.1 GENERAL. The seal of the Trust shall consist of a flat-faced die with the
word "Delaware", together with the name of the Trust and the year of its
organization cut or engraved thereon, but, unless otherwise required by the
Trustees, the seal shall not be necessary to be placed on, and its absence shall
not impair the validity of, any document, instrument or other paper executed and
delivered by or on behalf of the Trust.
ARTICLE 8
---------
Execution of Papers
8.1 GENERAL. Except as the Trustees may generally or in particular cases
authorize the execution thereof in some other manner, all deeds, leases,
contracts, notes and other obligations made by the Trustees shall be signed by
the President, any Vice President or by the Treasurer or such other officers or
agents as shall be designated for that purpose by a vote of the Trustees.
ARTICLE 9
---------
Issuance of Shares Certificates
9.1 SHARE CERTIFICATES. In lieu of issuing certificates for shares of the
Trust, the Trustees or the transfer agent may either issue receipts therefor or
may keep accounts upon the books of the Trust for the record holders of such
shares, who shall in either case be deemed, for all purposes hereunder, to be
the holders of certificates for such shares as if they had accepted such
certificates and shall be held to have expressly assented and agreed to the
terms hereof .
The Trustees may at any time authorize the issuance of share certificates
either in limited cases or to all Shareholders. In that event, a Shareholder
may receive a certificate stating the number of shares owned by him or her, in
such form as shall be prescribed from time to time by the Trustees. Such
certificate shall be signed by the president or a vice president and by the
treasurer or assistant treasurer. Such signatures may be facsimiles if the
certificate is signed by a transfer agent, or by a registrar, other than a
Trustee, officer or employee of the Trust. In case any officer who has signed
or whose facsimile signature has been placed on such certificate shall cease to
be such officer before such certificate is issued, it may be issued by the Trust
with the same effect as if he or she were such officer at the time of its issue.
9.2 LOSS OF CERTIFICATES. In case of the alleged loss or destruction or the
mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees shall prescribe. The Trust may
require the owner of the lost, destroyed or mutilated share certificate, or his
or her legal representative, to give the Trust a bond sufficient to indemnify it
against any claim that may be made against it on account of the alleged loss,
destruction or mutilation of any such certificate or the issuance of such new
certificate.
9.3 ISSUANCE OF NEW CERTIFICATE TO PLEDGEE. A pledgee of shares transferred as
collateral security shall be entitled to a new certificate if the instrument of
transfer substantially describes the debt or duty that is intended to be secured
thereby. Such new certificate shall express on its face that it is held
5
<PAGE>
as collateral security, and the name of the pledgor shall be stated thereon, who
alone shall be liable as a Shareholder, and entitled to vote thereon.
9.4 DISCONTINUANCE OF ISSUANCE OF CERTIFICATES. The Trustees may at any time
discontinue the issuance of share certificates and may, by written notice to
each Shareholder, require the surrender of share certificates to the Trust for
cancellation. Such surrender and cancellation shall not affect the ownership of
shares in the Trust.
ARTICLE 10
----------
Dealings with Trustees and Officers
10.1 GENERAL. Any Trustee, officer or other agent of the Trust may acquire, own
and dispose of shares of the Trust to the same extent as if he or she were not a
Trustee, officer or agent; and the Trustees may accept subscriptions to shares
or repurchase shares from any firm or company in which any Trustee, officer or
other agent of the Trust may have an interest.
ARTICLE 11
----------
Amendments to the By-Laws
11.1 GENERAL. These By-Laws may be amended or repealed, by a majority of the
Trustees then in office at any meeting of the Trustees, or by one or more
writings signed by such a majority.
6
<PAGE>
EXHIBIT C.1.
NUMBER SHARES
[ ] [ ]
UAM FUNDS TRUST
[NAME OF PORTFOLIO]
INSTITUTIONAL CLASS SHARES
SHARES OF BENEFICIAL INTEREST,
WITHOUT PAR VALUE
CUSIP #:
THIS CERTIFIES THAT
SPECIMEN ORGANIZED UNDER
THE LAWS OF THE
STATE OF DELAWARE
IS THE OWNER OF
TRANSFERABLE ONLY ON THE BOOKS OF THE ABOVE TRUST BY THE HOLDER HEREOF
IN PERSON OR BY DULY AUTHORIZED ATTORNEY UPON SURRENDER OF THIS
CERTIFICATE PROPERLY ENDORSED.
THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE ISSUED AND
SHALL BE HELD SUBJECT TO ALL OF THE PROVISIONS OF THE AGREEMENT AND
DECLARATION OF TRUST OF UAM FUNDS TRUST TO ALL OF WHICH THE HOLDER BY
ACCEPTANCE HEREOF ASSENTS. THIS CERTIFICATE IS NOT VALID UNTIL
COUNTERSIGNED BY THE TRANSFER AGENT. WITNESS, THE FACSIMILE SEAL OF
UAM FUNDS TRUST AND THE SIGNATURES OF ITS DULY AUTHORIZED OFFICERS.
DATED: COUNTERSIGNED
AND REGISTERED:
[___________
_________________________________________________________________]
TRANSFER AGENT
AND REGISTRAR
SPECIMEN
PRESIDENT TREASURER BY
AUTHORIZED
SIGNATURE
1
<PAGE>
UAM FUNDS TRUST
THE TRUST WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER UPON REQUEST A
FULL STATEMENT OF THE DESIGNATIONS AND ANY PREFERENCES, CONVERSION AND
OTHER RIGHTS, VOTING POWERS, RESTRICTIONS, LIMITATIONS AS TO DIVIDENDS,
QUALIFICATIONS, AND TERMS AND CONDITIONS OF REDEMPTION OF THE STOCK OF EACH
CLASS WHICH THE PORTFOLIO IS AUTHORIZED TO ISSUE. SUCH REQUEST MAY BE MADE
TO THE TRANSFER AGENT OF THE COMPANY AT ITS OFFICE IN BOSTON,
MASSACHUSETTS.
THE FOLLOWING ABBREVIATIONS, WHEN USED IN THE INSCRIPTION ON THE FACE
OF THIS CERTIFICATE, SHALL BE CONSTRUED AS THOUGH THEY WERE WRITTEN
OUT IN FULL ACCORDING TO APPLICABLE LAWS OR REGULATIONS.
TEN COM - as tenants in common UNIF GIFT MIN ACT __________ Custodian _________
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minor Act
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
______________
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED ____________ HEREBY SELL ASSIGN AND TRANSFER UNTO
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- -------------------------------
- --------------------------------------------------------------------------------
- ---------------------
- --------------------------------------------------------------------------------
- ---------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- --------------------------------------------------------------------------------
- ---------------------
- --------------------------------------------------------------------------------
- ---------------------
- --------------------------------------------------------------------------------
- ---------------------
2
<PAGE>
SHARES REPRESENTED BY THE WITHIN CERTIFICATE, AND DO HEREBY IRREVOCABLY
CONSTITUTE AND APPOINT
- --------------------------------------------------------------------------------
- ---------------------
ATTORNEY TO TRANSFER THE SAID SHARES ON THE BOOKS OF THE WITHIN NAMED PORTFOLIO
WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.
DATED ________________ 19___
SIGNATURE GUARANTEED
________________________________
________________________________________________
(SIGNATURE OF SELLER MUST BE GUARANTEED)
3
<PAGE>
NUMBER SHARES
[ ] [ ]
UAM FUNDS TRUST
[NAME OF PORTFOLIO]
INSTITUTIONAL SERVICE CLASS SHARES
SHARES OF BENEFICIAL INTEREST,
WITHOUT PAR VALUE
CUSIP #:
THIS CERTIFIES THAT
SPECIMEN ORGANIZED UNDER
THE LAWS OF THE
STATE OF DELAWARE
IS THE OWNER OF
TRANSFERABLE ONLY ON THE BOOKS OF THE ABOVE TRUST BY THE HOLDER HEREOF
IN PERSON OR BY DULY AUTHORIZED ATTORNEY UPON SURRENDER OF THIS
CERTIFICATE PROPERLY ENDORSED.
THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE ISSUED AND
SHALL BE HELD SUBJECT TO ALL OF THE PROVISIONS OF THE AGREEMENT AND
DECLARATION OF TRUST OF UAM FUNDS TRUST TO ALL OF WHICH THE HOLDER BY
ACCEPTANCE HEREOF ASSENTS. THIS CERTIFICATE IS NOT VALID UNTIL
COUNTERSIGNED BY THE TRANSFER AGENT. WITNESS, THE FACSIMILE SEAL OF
UAM FUNDS TRUST AND THE SIGNATURES OF ITS DULY AUTHORIZED OFFICERS.
DATED: COUNTERSIGNED
AND REGISTERED:
[______________
_________________________________________________________________]
TRANSFER AGENT
AND REGISTRAR
SPECIMEN
PRESIDENT TREASURER BY
AUTHORIZED
SIGNATURE
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UAM FUNDS TRUST
THE TRUST WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER UPON REQUEST A
FULL STATEMENT OF THE DESIGNATIONS AND ANY PREFERENCES, CONVERSION AND
OTHER RIGHTS, VOTING POWERS, RESTRICTIONS, LIMITATIONS AS TO DIVIDENDS,
QUALIFICATIONS, AND TERMS AND CONDITIONS OF REDEMPTION OF THE STOCK OF EACH
CLASS WHICH THE PORTFOLIO IS AUTHORIZED TO ISSUE. SUCH REQUEST MAY BE MADE
TO THE TRANSFER AGENT OF THE COMPANY AT ITS OFFICE IN BOSTON,
MASSACHUSETTS.
THE FOLLOWING ABBREVIATIONS, WHEN USED IN THE INSCRIPTION ON THE FACE
OF THIS CERTIFICATE, SHALL BE CONSTRUED AS THOUGH THEY WERE WRITTEN
OUT IN FULL ACCORDING TO APPLICABLE LAWS OR REGULATIONS.
TEN COM - as tenants in common UNIF GIFT MIN ACT __________ Custodian __________
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minor Act
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
______________
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED ____________ HEREBY SELL ASSIGN AND TRANSFER UNTO
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
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__________________
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PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
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SHARES REPRESENTED BY THE WITHIN CERTIFICATE, AND DO HEREBY IRREVOCABLY
CONSTITUTE AND APPOINT
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ATTORNEY TO TRANSFER THE SAID SHARES ON THE BOOKS OF THE WITHIN NAMED PORTFOLIO
WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.
DATED ________________ 19___
SIGNATURE GUARANTEED
_________________________________
________________________________________________
(SIGNATURE OF SELLER MUST BE GUARANTEED)
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Exhibit C.2.
BYLAWS
OF
THE REGIS FUND II
ARTICLE 9
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Issuance of Shares Certificates
9.1 SHARE CERTIFICATES. In lieu of issuing certificates for shares of the
Trust, the Trustees or the transfer agent may either issue receipts therefor or
may keep accounts upon the books of the Trust for the record holders of such
shares, who shall in either case be deemed, for all purposes hereunder, to be
the holders of certificates for such shares as if they had accepted such
certificates and shall be held to have expressly assented and agreed to the
terms hereof.
The Trustees may at any time authorize the issuance of share certificates
either in limited cases or to all Shareholders. In that event, a Shareholder may
receive a certificate stating the number of shares owned by him or her, in such
form as shall be prescribed from time to time by the Trustees. Such certificate
shall be signed by the president or a vice president and by the treasurer or
assistant treasurer. Such signatures may be facsimiles if the certificate is
signed by a transfer agent, or by a registrar, other than a Trustee, officer or
employee of the Trust. In case any officer who has signed or whose facsimile
signature has been placed on such certificate shall cease to be such officer
before such certificate is issued, it may be issued by the Trust with the same
effect as if he or she were such officer at the time of its issue.
9.2 LOSS OF CERTIFICATES. In case of the alleged loss or destruction or the
mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees shall prescribe. The Trust may
require the owner of the lost, destroyed or mutilated share certificate, or his
or her legal representative, to give the Trust a bond sufficient to indemnify it
against any claim that may be made against it on account of the alleged loss,
destruction or mutilation of any such certificate or the issuance of such new
certificate.
9.3 ISSUANCE OF NEW CERTIFICATE TO PLEDGEE. A pledgee of shares transferred
as collateral security shall be entitled to a new certificate if the instrument
of transfer substantially describes the debt or duty that is intended to be
secured thereby. Such new certificate shall express on its face that it is held
as collateral security, and the name of the pledgor shall be stated thereon, who
alone shall be liable as a Shareholder, and entitled to vote thereon.
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9.4 DISCONTINUANCE OF ISSUANCE OF CERTIFICATES. The Trustees may at any time
discontinue the issuance of share certificates and may, by written notice to
each Shareholder, require the surrender of share certificates to the Trust for
cancellation. Such surrender and cancellation shall not affect the ownership of
shares in the Trust.
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Exhibit C.3.
THE REGIS FUND II
AGREEMENT AND DECLARATION OF TRUST
April 26, 1994
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AGREEMENT AND DECLARATION OF TRUST
ARTICLE II
PURPOSE OF TRUST
The purposes of the Trust are (i) to operate as an investment company and
to offer Shareholders of the Trust and each Sub-Trust of the Trust one or more
investment programs primarily in securities and debt instruments, and (ii) to
engage in such activities that are necessary, suitable, incidental, or
convenient to the accomplishment of the foregoing.
ARTICLE III
THE TRUSTEES
(c) ELECTION AND TERM. The Trustees shall be elected by the Shareholders
of the Trust at a meeting of the Shareholders held prior to the effective date
of the Registration Statement of the Trust under the 1940 Act, and the term of
office of any Trustees in office before such election shall terminate at the
time of such election. Each Trustee shall be a natural person and may, but need
not be a Shareholder. Each Trustee, whether named above or hereafter becoming a
Trustee, shall serve as a Trustee of the Trust and of each Sub-Trust hereunder
during the lifetime of this Trust and until its termination as hereinafter
provided except as such Trustee sooner dies, resigns, retires, or is removed or,
if sooner, until the next meeting of Shareholders called for the purpose of
electing Trustees and until the election and qualification of his successor.
The Shareholders may fix the number of Trustees and elect Trustees at any
meeting of Shareholders called by the Trustees for that purpose and to the
extent required by applicable law, including paragraph (a) and (b) of Section 16
of the 1940 Act. Subject to Section 16(a) of the 1940 Act, the Trustees may
elect successors and may, pursuant to Section 3.1(f) hereof, appoint Trustees to
fill vacancies.
ARTICLE IV
SHARES
(c) DIVIDENDS. Dividends and distributions on Shares of a particular Sub-
Trust or any class thereof may be paid with such frequency as the Trustees may
determine, which may be daily or otherwise pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the Trustees may
determine, to the holders of Shares of that Sub-Trust or class, from such of the
income and capital gains, accrued or realized, from the assets belonging to that
Sub-Trust, or in the case of a class, belonging to that Sub-Trust and allocable
to that class, as the Trustees may determine, after providing for actual and
accrued liabilities belonging to that Sub-Trust or class. All dividends and
distributions on Shares of a particular Sub-Trust or class thereof shall be
distributed pro rata to the holders of Shares of that Sub-Trust or class in
proportion to the number of Shares of that Sub-Trust or class held by such
holders at the date and
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time of record established for the payment of such dividends or distributions,
except that in connection with any dividend or distribution program or procedure
the Trustees may determine that no dividend or distribution shall be payable on
Shares as to which the Shareholder's purchase order and/or payment have not been
received by the time or times established by the Trustees under such program or
procedure. Such dividends and distributions may be made in cash or Shares of
that Sub-Trust or class of a combination thereof as determined by the Trustees
or pursuant to any program that the Trustees may have in effect at the time for
the election by each Shareholder of the mode of the making of such dividend or
distribution to that Shareholder. Any such dividend or distribution paid in
Shares will be paid at the net asset value thereof as determined in accordance
with subsection (h) of this Section 4.2.
The Trustees shall have full discretion to determine which items shall be
treated as income and which items as capital; and each such determination and
allocation shall e conclusive and binding upon the Shareholders.
(d) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, subject to Section 7.1 hereof, the holders of Shares of each Sub-Trust or
any class thereof that has been established and designated shall be entitled to
receive, when and as declared by the Trustees, the excess of the assets
belonging to that Sub-Trust, or in the case of a class, belonging to that Sub-
Trust and allocable to that class, over the liabilities belonging to that Sub-
Trust or class. The assets so distributable to the holders of Shares of any
particular Sub-Trust or class thereof shall be distributed among such holders in
proportion to the number of Shares of that Sub-Trust or class thereof held by
them and recorded on the books of the Trust. The liquidation of any particular
Sub-Trust or class thereof may be authorized at any time by vote of a majority
of the Trustees then in office.
(e) VOTING. On each matter submitted to a vote of the Shareholders, each
holder of a Share shall be entitled to one vote for each whole Share standing in
his name on the books of the Trust irrespective of the Series thereof or class
thereof and all Shares of all Series and classes thereof shall vote together as
a single class; provided, however, that as to any matter (i) with respect to
which a separate vote of one or more Series or classes thereof is required by
the 1940 Act or the provisions of the writing establishing and designating the
Sub-Trust or class, such requirements as to a separate vote by such Series or
class thereof shall apply in lieu of all Shares of all Series and classes
thereof voting together; and (ii) as to any matter which affects the interests
of one or more particular Series or classes thereof, only the holders of Shares
of the one or more affected Series or classes shall be entitled to vote, and
each such Series or class shall vote as a separate class.
(f) REDEMPTION BY SHAREHOLDER. Each holder of Shares of a particular Sub-
Trust or any class thereof shall have the right at such times as may be
permitted by the Trust to require the Trust to redeem all or any part of his
Shares of that Sub-Trust or class thereof at a redemption price equal to the net
asset value per Share of that Sub-Trust or class thereof next determined in
accordance with subsection (h) of this Section 4.2 after the Shares are properly
tendered for redemption, subject to any contingent deferred sales charge or
redemption charge in effect at the time of redemption. Payment of the
redemption price shall be in cash; provided, however, that if the Trustees
determine, which determination shall be conclusive, that conditions
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exist which make payment wholly in cash unwise or undesirable, the Trust may,
subject to the requirements of the 1940 Act, make payment wholly or partly in
securities or other assets belonging to the Sub-Trust of which the Shares being
redeemed are part at the value of such securities or assets used in such
determination of net asset value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of any Sub-
Trust or class thereof to require the Trust to redeem Shares of that Sub-Trust
during any period or at any time when and to the extent permissible under the
1940 Act.
(g) REDEMPTION BY TRUST. Each Share of each Sub-Trust or class thereof
that has been established and designated is subject to redemption by the Trust
at the redemption price which would be applicable if such Share was then being
redeemed by the Shareholder pursuant to subsection (f) of this Section 4.2: (i)
at any time, in the sole discretion of the Trustees, or (ii) upon such other
conditions as may from time to time be determined by the Trustees and set forth
in the then current Prospectus or Statement of Additional Information of the
Trust. Upon such redemption the holders the Shares so redeemed shall have no
further right with respect thereto other than to receive payment of such
redemption price.
(h) NET ASSET VALUE. The net asset value per Share of any Sub-Trust shall
be (i) in the case of a Sub-Trust whose Shares are not divided into classes, the
quotient obtained by dividing the value of the net assets of that Sub-Trust
(being the value of the assets belonging to that Sub-Trust less the liabilities
belonging to that Sub-Trust) by the total number of Shares of that Sub-Trust
outstanding, and (ii) in the case of a class of Shares of a Sub-Trust whose
Shares are divided into classes, the quotient obtained by dividing the value of
the net assets of that Sub-Trust allocable to such class (being the value of the
assets belonging to that Sub-Trust allocable to such class less the liabilities
belonging to such class) by the total number of Shares of such class
outstanding; all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by the
Trustees from time to time.
The Trustees may determine to maintain the net asset value per Share of any
Sub-Trust at a designated constant dollar amount and in connection therewith may
adopt procedures not inconsistent with the 1940 Act for the continuing
declarations of income attributable to that Sub-Trust as dividend payable in
additional shares of the Sub-Trust at the designated constant dollar amount and
for the handling of any losses attributable to that Sub-Trust. Such procedures
may provide that in the event of any loss each Shareholder shall be deemed to
have contributed to the capital of the Trust attributable to that Sub-Trust his
pro rata portion of the total number of Shares required to be canceled in order
to permit the net asset value per Share of that Sub-Trust to be maintained,
after reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Trust shall be deemed to have agreed, by his investment in
any Sub-Trust with respect to which the Trustees shall have adopted any such
procedure, to make the contribution referred to in the preceding sentence in the
event of any such loss.
(i) TRANSFER. All Shares of each particular Sub-Trust or class thereof
shall be transferable, but transfers of Shares of a particular Sub-Trust or
class thereof will be recorded on the Share transfer records of the Trust
applicable to that Sub-Trust or class only at such times as
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Shareholders shall have the right to require the Trust to redeem Shares of that
Sub-Trust or class and at such other times as may be permitted by the Trustees.
(j) EQUALITY. Except as provided herein or in the instrument designating
and establishing any class of Shares or any Sub-Trust, all Shares of each
particular Sub-Trust or class thereof shall represent an equal proportionate
interest in the assets belonging to that Sub-Trust, or in the case of a class,
belonging to that Sub-Trust and allocable to that class, subject to the
liabilities belonging to that Sub-Trust or class and each share of any
particular Sub-Trust or class shall be equal to each other Share of that Sub-
Trust or class; but the provisions of this sentence shall not restrict any
distinctions permissible under subsection (C) of this Section 4.2 that may exist
with respect to dividends and distributions on Shares of the same Sub-Trust or
class. The Trustees may from time to time divide or combine the Shares of any
particular Sub-Trust or class into a greater or lesser number of Shares of that
Sub-Trust or class without thereby changing the proportionate beneficial
interest in the assets belonging to that Sub-Trust or class or in any way
affecting the rights of Shares of any other Sub-Trust or class.
(k) FRACTIONS. Any fractional Share of any Sub-Trust or class, if any such
fractional Share is outstanding, shall carry proportionately all the rights and
obligations of a whole Share of that Sub-Trust or class, including rights and
obligations with respect to voting, receipt of dividends and distributions,
redemption of Shares, and liquidation of the Trust.
(m) CLASS DIFFERENCES. Subject to Section 4.1, the relative rights and
preferences of the classes of any Sub-Trust may differ in such other respects as
the Trustees may determine to be appropriate in their sole discretion, provided
that such differences are set forth in the instrument establishing and
designating such classes and executed by a majority of the Trustees (or by an
instrument executed by an officer of the Trust pursuant to a vote of a majority
of the Trustees).
Section 4.3 OWNERSHIP OF SHARES. The ownership of Shares shall be
recorded on the books of the Trust or of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Shares of each Sub-
Trust and each class thereof that has been established and designated. No
certificates certifying the ownership of Shares need be issued except as the
Trustees may otherwise determine from time to time. The trustees may make such
rules as they consider appropriate for the issuance of Share certificates, the
use of facsimile signature, the transfer of Shares and similar matters. The
record books of the Trust as kept by the Trust or any transfer or similar agent,
as the case may be, shall be conclusive as to who are the Shareholders and as to
the number of Shares of each Sub-Trust and class thereof held from time to time
by each such Shareholder.
Section 4.5 NO PRE-EMPTIVE RIGHTS. Shareholders shall have no pre-emptive
or other rights to subscribe to any additional Shares or other securities issued
by the Trust or any Sub-Trust, except as the Trustees in their sole discretion
shall have determined by resolution.
Section 4.6 STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY. Shares
shall be deemed to be personal property giving only the rights provided in this
Declaration of Trust. Every Shareholder by virtue of acquiring Shares shall be
held to have expressly assented
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and agreed to the terms hereof and to have become a party hereto. The death,
incapacity, dissolution, termination, or bankruptcy of a Shareholder during the
continuance of the Trust shall not operate to dissolve or terminate the Trust or
any Sub-Trust thereof nor entitle the representative of such Shareholder to an
accounting or to take any action in court or elsewhere against the Trust or the
Trustees, but only to the rights of such Shareholder under this Trust. Ownership
of Shares shall not entitle the Shareholder to any title in or to the whole or
any part of the Trust property or right to call for a partition or division of
the same or for an accounting, nor shall the ownership of Shares constitute the
Shareholders partners. Neither the Trust nor the Trustees nor any officer,
employee or agent of the Trust shall have any power to bind personally any
Shareholder, nor except as specifically provided herein to call upon any
Shareholder for the payment of any sum of money or assessment whatsoever other
than such as the Shareholder may at any time personally agree to pay.
Section 4.7 NO APPRAISAL RIGHTS. Shareholders shall have no right to
demand payment for their shares or to any other rights of dissenting
shareholders in the event the Trust participates in any transaction which would
give rise to appraisal or dissenters' rights by a shareholder of a corporation
organized under the General Corporation Law of the State of Delaware, or
otherwise.
ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 VOTING POWERS. The Shareholders shall have power to vote only
(i) for the election of Trustees as provided in Section 3.1, (ii) with respect
to any contract with a Contracting Party as provided in Section 3.3 as to which
Shareholder approval is required by the 1940 Act, (iii) with respect to any
termination or reorganization of the Trust to the extent and as provided in
Sections 7.1 and 7.2, (iv) with respect to any amendment of this Declaration of
Trust to the extent and as provided in Section 7.3, and (v) with respect to such
additional matters relating to the Trust as may be required by the 1940 Act,
this Declaration of Trust, the By-Laws or any registration of the Trust with the
Commission (or any successor agency) or any state, or as the Trustees may
consider necessary or desirable. There shall be no cumulative voting in the
election of Trustees. Shares may be voted in person or by proxy. Proxies may
be given orally or in writing or pursuant to any computerized or mechanical data
gathering process specifically approved by the Trustees. A proxy with respect
to Shares held in the name of two or more persons shall be valid if executed by
any one of them unless at or prior to exercise of the proxy the Trust receives a
specific written notice to the contrary from any one of them. A proxy
purporting to be executed by or on behalf of a Shareholder shall be deemed valid
unless challenged at or prior to its exercise and the burden of proving
invalidity shall rest on the challenger. At any time when no Shares of a Series
are outstanding, the Trustees may exercise all rights of Shareholders of that
Series with respect to matters affecting that Series and may take any actions
required by law, this Declaration of Trust, or the By-Laws to be taken by
Shareholders.
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Section 5.2 MEETINGS. No annual or regular meeting of Shareholders is
required. Special meetings of Shareholders may be called by the Trustees from
time to time for the purpose of electing Trustees as herein provided and for
such other purposes as may be prescribed by law, this Declaration of Trust or
the By-Laws, or for taking action upon any other matter deemed by the Trustees
to be necessary or desirable. Written notice of any meeting of Shareholders
shall be given or caused to be given by the Trustees by mailing such notice at
least seven days before such meeting, postage prepaid, stating the time, place,
and purpose of the meeting, to each Shareholder at the Shareholder's address as
it appears on the record of the Trust. Whenever notice of a meeting is required
to be given to a Shareholder under the Declaration of Trustee or the By-Laws, a
written waiver thereof, executed before or after the meeting by such Shareholder
or his attorney thereunto authorized and filed with the records of the meeting,
shall be deemed equivalent to such notice.
Section 5.3 RECORD DATES. For the purpose of determining the Shareholders
who are entitled to vote or act at any meeting or any adjournment thereof, or
who are entitled to participate in any dividend or distribution, or for the
purpose of any other action, the Trustees may from time to time close the
transfer books for such period, not exceeding 30 days (except at or in
connection with the termination of the Trust), as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date and time not more
than 90 days prior to the date of any meeting of Shareholders or other action as
the date and time of record for the determination of Shareholders entitled to
vote at such meeting or any adjournment thereof or to be treated as a
Shareholder of record for purposes of such other action, even though he has
since that date and time disposed of his Shares, and no Shareholder becoming
such after that date and time shall be so entitled to vote at such meeting or
any adjournment thereof or to be treated as a Shareholder of record for purposes
of such other action. Nothing in this section shall be construed as precluding
the Trustees from setting different record dates for different Sub-Trusts.
Section 5.4 QUORUM AND REQUIRED VOTE. Except as otherwise provided by the
1940 Act or other applicable law, thirty percent of the Shares entitled to vote
shall be a quorum for the transaction of business at a Shareholders' meeting.
Any meeting of shareholders, whether or not a quorum is present, may be
adjourned from time to time by the majority of the Shares represented at the
meeting, either in person or by proxy. Any adjourned session or sessions may be
held, within a reasonable time after the date set for the original meeting
without the necessity of notice of the adjourned meeting or of the business to
be transacted at an adjourned meeting, other than by announcement at the meeting
at which the adjournment is taken, unless the Trustees fix a new record date for
the adjourned meeting. A majority of the Shares voted, at a meeting of which a
quorum is present, shall decide any questions and a plurality shall elect a
Trustee, except when a different vote is required or permitted by any provision
of the 1940 Act or other applicable law or by this Declaration of Trust or the
By-Laws.
Section 5.5 ACTION BY WRITTEN CONSENT. Subject to the provisions of the
1940 Act and other applicable law, any action taken by Shareholders may be taken
without a meeting if a majority of Shareholders entitled to vote on the matter
(or such larger proportion thereof as shall be required by the 1940 Act or by
any express provision of this Declaration of Trust or the By-Laws) consent to
the action in writing and such written consents are filed with the record of the
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meetings of Shareholders. Such consent shall be treated for all purposes as a
vote taken at a meeting of Shareholders.
Section 5.6 INSPECTION OF RECORDS. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted stockholders of
a Delaware corporation under the Delaware General Law.
Section 5.7 ADDITIONAL PROVISIONS. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE VI
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 6.1 TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE.
All persons extending credit to, contracting with or having any claim against
the Trust shall look only to the assets of the Sub-Trust with which such person
dealt for payment under such credit, contract or claim; and neither the
Shareholders of any Sub-Trust nor the Trustees, nor any of the Trust's officers,
employees or agents, whether past, present or future, nor any other Sub-Trust
nor the Trustees, nor any of the Trust's officers, employees or agents, whether
past, present or future, nor any other Sub-Trust shall be personally liable
therefor. Every note, bond, contract, instrument, certificate, or undertaking
and every act or thing whatsoever executed or done by or on behalf of the Trust,
any Sub-Trust or the Trustees or any of them in connection with the Trust shall
be conclusively deemed to have been executed or done only by or for the Trust
(or the Sub-Trust) or the Trustees and not personally. The Trustees and the
Trust's officers, employees and agents shall not be liable to the Trust or the
Shareholders; provided however, that nothing in this Declaration of Trust shall
protect any Trustee or officer, employee or agent against any liability to the
Trust or the Shareholders to which such Trustee or officer, employee or agent
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee or of such officer, employee or agent.
Every note, bond, contract, instrument, certificate, or undertaking made or
issued by the Trustees or by any officers or officer shall give notice that the
same was executed or made by or on behalf of the Trust or by them as Trustees or
Trustee or as officers or officer and not individually and that the obligations
of such instrument are not binding upon any of them or the Shareholders
individually but are binding only upon the assets and property of the Trust, or
the particular Sub-Trust in question, as the case may be, but the omission
thereof shall not operate to bind any Trustees or Trustee or officers officer or
Shareholders or Shareholder individually or otherwise invalidate any such note,
bond, contract, instrument, certificate, or undertaking.
Section 6.2 TRUSTEE'S GOOD FAITH ACTION; EXPERT ADVICE; NO BOND OR SURETY.
The exercise by the Trustees of their powers and discretion hereunder shall be
binding upon everyone interested. A Trustee shall be liable to the Trust and
the Shareholders for his own
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willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of the office of Trustee, and for nothing else,
and shall not be liable for errors of judgment or mistakes of fact or law.
Subject to the foregoing, (a) the Trustees shall not be responsible or liable in
any event for any neglect or wrongdoing of any officer, agent, employee,
consultant, adviser, administrator, distributor or principal underwriter,
custodian or transfer, dividend disbursing, Shareholder servicing or accounting
agent of the Trust, nor shall any Trustee be responsible for the act or omission
of any other Trustee; (b) the Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration of Trust
and their duties as Trustees, and shall be under no liability for any act or
omission in accordance with such advice or for failing to follow such advice;
and (c) in discharging their duties, the Trustees, when acting in good faith,
shall be entitled to rely upon the books of account of the Trust and upon
written reports made to the Trustees by any officer appointed by them, any
independent public accountant, and (with respect to the subject matter of the
contract involved) any officer partner, or responsible employee of a Contracting
Party appointed by the Trustees pursuant to Section 3.3. The Trustees as such
shall not be required to give any bond or surety or any other security for the
performance of their duties. To the extent that, at law or in equity, a Trustee
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to a shareholder any such Trustee acting under this Declaration of
Trust shall not be liable to the Trust or to any such Shareholder for the
Trustee's good faith reliance on the provisions of this Declaration of Trust.
The provisions of this Declaration of Trust, to the extent that they restrict
the duties and liabilities of a Trustee otherwise existing at law or in equity,
are agreed by the Shareholders to replace such other duties and liabilities of
such Trustee.
Section 6.3 INDEMNIFICATION OF SHAREHOLDERS. In case any Shareholder (or
former Shareholder) of any Sub-Trust or the Trust shall be charged or held to be
personally liable for any obligation or liability of the Trust solely by reason
of being or having been a Shareholder and not because of such Shareholder's acts
or omissions or for some other reason, the Trust on behalf of said Sub-trust
(upon proper and timely request by the Shareholder) shall assume the defense
against such charge and satisfy any judgment thereon, and, to the fullest extent
permitted by law, the Shareholder or former Shareholder (or his heirs,
executors, administrators, or other legal representatives or in the case of a
corporation or other entity, its corporate or other general successor) shall be
entitled out of the assets of said Sub-Trust estate to be held harmless from and
indemnified against all loss and expense arising from such liability.
ARTICLE VII
MISCELLANEOUS
Section 7.1 DURATION AND TERMINATION OF TRUST. Unless terminated as
provided herein, the Trust shall continue without limitation of time and,
without limiting the generality of the foregoing, no change, alteration or
modification with respect to any Sub-Trust or class thereof shall operate to
terminate the Trust. The Trust may be terminated at any time by a Majority of
the Outstanding Voting Shares of the Trust or by the Trustees by written notice
to the Shareholders.
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Upon termination, after paying or otherwise providing for all charges,
taxes, expenses and liabilities, whether due to accrued or anticipated as may be
determined by the Trustees, the Trust shall in accordance with such procedures
as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash, securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with the
provisions of subsection (d) of Section 42.
Section 7.2 REORGANIZATION. The Trustees may sell, convey, merge, and
transfer the assets of the Trust, or the assets belonging to any one or more
Sub-Trusts, to another trust, partnership, association, or corporation organized
under the laws of any state of the United States, or to the Trust to be held as
assets belonging to another Sub-Trust of the Trust in exchange for cash, shares
or other securities (including, in the case of a transfer to another Sub-Trust
of the Trust, Shares of such other Sub-Trust or any class thereof) with such
transfer either (1) being made subject to, or with the assumption by the
transferee of, the liabilities belonging to each Sub-Trust the assets of which
are so transferred, or (2) not being made subject to, or not with the assumption
of, such liabilities; provided, however, that no assets belonging to any
particular Sub-Trust shall be so transferred unless the terms of such transfer
shall have first been approved at a meeting called for the purpose by the
affirmative vote of the holders of a Majority of the Outstanding Voting Shares
of that Sub-Trust. Following such transfer, the Trustees shall distribute such
cash, shares, or other securities among the Shareholders of the Sub-Trust
(taking into account the differences among the classes of Shares thereof, if
any) the assets belonging to which have been so transferred; and if all of the
assets of the Trust have been so transferred, the Trust shall be terminated.
The Trust, or any one or more Sub-Trusts, may either as the successor,
survivor, or non-survivor, (1) consolidate with one or more other trusts,
partnerships, limited liability companies, associations, or corporations
organized under the laws of the State of Delaware or any other state of the
United States, to form a new consolidated trust, partnership, association or,
corporation under the laws of which any one of the constituent entities is
organized, or (2) merge into or transfer a substantial portion of its assets to
one or more other trusts, partnerships, associations, or corporations organized
under the laws of the State of Delaware or any other state of the United States,
or have one or more such trusts, partnerships, associations, or corporations
merged into or transfer a substantial portion of its assets to it, any such
consolidation as are specified in an agreement and plan of reorganization
entered into by the Trust, or one or more Sub-Trusts as the case may be, in
connection therewith. Any such consolidation, merger or transfer shall require
the affirmative vote of the holders of a Majority of the Outstanding Voting
Shares of the Trust (or each Sub-Trust affected thereby, as the case may be),
except that such affirmative vote of the holders of Shares shall not be required
if the Trust (or Sub-Trust affected thereby, as the case may be) shall be the
survivor of such consolidation or merger or transferee of such assets.
Section 7.3 AMENDMENTS. All rights granted to the Shareholders under this
Declaration of Trust are granted subject to the reservation of the right to
amend this Declaration of Trust as herein provided, except that no amendment
shall repeal the limitations on personal liability of any Shareholder or Trustee
or repeal the prohibition of assessment upon the Shareholders without the
express consent of each Shareholder or Trustee involved. Subject to the
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foregoing, the provisions of this Declaration of Trust (whether or not related
to the rights of Shareholders) may be amended at any time, so long as such
amendment does not adversely affect the rights of any Shareholder with respect
to which such amendment is or purports to be applicable and so long as such
amendment is not in contravention of applicable law, including the 1940 Act, by
an instrument in writing signed by a majority of the then Trustees (or by an
officer of the Trust pursuant to the vote of a majority of such Trustees). Any
amendment to this Declaration of Trust that adversely affects the rights of
Shareholders may be adopted at any time by an instrument in writing signed by a
majority of the then Trustees (or by an officer of the Trust pursuant to a vote
of a majority of such Trustees) when authorized to do so by the vote in
accordance with subsection (e) of Section 4.2 of Shareholders holding a majority
of the Shares entitled to vote. Without limiting the generality of the
foregoing, amendments having the purposes of changing the name of the Trust or
any Sub-Trust or of supplying any omission, curing or curing, correcting or
supplementing any defective or inconsistent provision contained herein shall not
require authorization by Shareholder vote. Subject to the provisions of this
Section 7.3, any amendment shall be effective as provided in the instrument
containing the terms of such amendment or, if there is no provision therein with
respect to effectiveness, upon the execution of such instrument and of a
certificate (which may be a part of such instrument) executed by a Trustee or
officer of the Trust to the effect that such amendment has been duly adopted.
Section 7.4 FILING OF COPIES; REFERENCES; HEADINGS. The original or a
copy of this instrument and of each amendment hereto shall be kept at the office
of the Trust where it may be inspected by any Shareholder. Anyone dealing with
the Trust may rely on a certificate by an officer of the Trust as to whether or
not any such amendments have been made, as to the identities of the Trustees and
officers, and as to any matters in connection with the Trust hereunder; and,
with the same effect as if it were the original, may rely on a copy certified by
an officer of the Trust to be a copy of this instrument or of any such
amendments. In this instrument and in any such amendment, references to this
instrument, and all expressions like "herein," "hereof," and "hereunder" shall
be deemed to refer to this instrument as a whole as the same may be amended or
affected by any such amendments. The masculine gender shall include the
feminine and neuter genders. Headings are placed herein for convenience of
reference only and shall not be taken as a part hereof or control or affect the
meaning, construction, or effect of his instrument. This instrument may be
executed in any number of counterparts each of which shall be deemed an
original.
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EXHIBIT E.1.
DISTRIBUTION AGREEMENT
BETWEEN
UAM FUND DISTRIBUTORS, INC.
AND
UAM FUNDS TRUST
THIS AGREEMENT entered into the 20th day of June, 1996, by and between
UAM FUNDS TRUST, a Delaware business trust, with an office located at 73 Tremont
Street, Boston, Massachusetts 02108 (the "Fund"), and UAM FUND DISTRIBUTORS,
INC., a Massachusetts corporation with its principal office located at 211
Congress Street, Boston, Massachusetts 02110 (the "Distributor").
W I T N E S S E T H:
--------------------
In consideration of the mutual covenants and agreements of the parties
hereto, the parties intending to be bound, mutually covenant and agree with each
other as follows:
1. The Fund hereby appoints the distributor as agent of the Fund to
effect the sale and public distribution of shares of the capital stock of the
Fund.
2. The Fund shall compensate the distributor for its services
rendered pursuant to the Fund's Rule 12b-1 Distribution Plan as adopted by
various portfolios or classes of the portfolios of the Fund pursuant to
Investment Company Act Rule 12b-1, a copy of which, as presently in force, is
attached hereto.
3. The Distributor shall be the agent for the Fund for the sale of
its shares either through dealers or otherwise and the Fund agrees that it will
not sell any shares to any person except to fill orders for the shares received
through the distributor; provided, however, that the foregoing shall not apply:
(a) to shares issued or sold in connection with the merger or consolidation of
any other investment company with the Fund or the acquisition by purchase or
otherwise of all or substantially all of the assets of any investment company or
substantially all of the outstanding shares of any such company by the Fund; (b)
to shares which may be offered by the Fund to its stockholders for reinvestment
of cash distributed from capital gains or net investment income of the Fund; (c)
to shares which may be issued to shareholders of a series of the Fund who
exercise any exchange privilege set forth in a Prospectus of the Fund; (d) to
shares issued to existing stockholders as the result of a stock split; (e) to
shares which the Fund otherwise may issue directly to registered stockholders
pursuant to authority of its Board of Trustees; or (f) shares sold in any
jurisdiction in which the Distributor is not registered as a broker-dealer.
4. The Fund hereby authorizes the Distributor to sell its shares in
accordance with the following schedule of prices:
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The applicable price will be the respective public offering price
applicable to each portfolio of the Fund or class of a Portfolio of the
Fund next effective after receipt and acceptance by the Fund of a proper
offer to purchase, determined in accordance with the Agreement and
Declaration of Trust, By-Laws, Registration Statement and Prospectus for
the portfolios and classes of portfolios of the Fund.
5. Orders for the purchase of shares placed by the Distributor shall
be subject to the provisions of Rule 2830 of the Conduct Rules of the NASD, the
provisions of which are hereby incorporated by reference.
6. The Fund agrees to prepare and file registration statements with
the Securities and Exchange Commission and the Securities Departments of various
states and other jurisdictions in which the shares may be offered, at its own
expense, and do such other things and to take such other actions as may be
mutually agreed upon by and between the parties as shall be reasonably necessary
in order to effect the registration and the sale of the Fund's shares. The
Distributor shall cooperate with the Fund in the preparation and filing of
applications for registration and qualification of the shares under applicable
law.
7. With respect to the apportionment of costs between the Fund and
the Distributor of activities with which both are concerned, the following will
apply:
(a) At its own expense, the Fund shall pay all costs incurred in
the preparation and mailing of the Fund's current Prospectuses, Statements of
Additional Information and reports to stockholders.
(b) The Distributor will pay the costs incurred in printing and
mailing copies of Prospectuses to prospective investors.
(c) The Distributor will pay advertising and promotional
expenses, including the costs of literature sent to prospective investors.
(d) The Distributor will pay the costs of any additional copies
of Fund financial and other reports and other Fund literature supplied to the
Distributor by the Fund for sales promotion purposes.
8. Normally, the Fund shall not exercise any direction or control
over the time and place of solicitation, the persons to be solicited, or the
manner of solicitation; but the Distributor agrees that solicitations shall be
in a form acceptable to the Fund and shall be subject to such terms and
conditions as may be prescribed from time to time by the Fund, the Registration
Statement, the Prospectuses, the Agreement and Declaration of Trust, and By-Laws
of the Fund, and shall not violate any provision of the laws of the United
States or any other jurisdiction to which solicitations are subject, or violate
any rule or regulation promulgated by any lawfully constituted authority to
which the Fund or Distributor may be subject.
9. (a) The Fund appoints and designates the Distributor as agent of
the Fund and the Distributor accepts such appointment as such agent, to
repurchase shares of the Fund in accordance with the provisions of the Agreement
and Declaration of Trust and By-Laws of the Fund.
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(b) In connection with such redemptions or repurchases the Fund
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the Investment Company Act of 1940 and as set forth in the
By-Laws and then current Prospectuses of the Fund.
(c) The authority of the Distributor under this paragraph 9 may,
with the consent of the Fund, be redelegated in whole or in part to another
person or firm.
(d) The authority granted in this paragraph 9 may be suspended
by the Fund at any time or from time to time pursuant to the provisions of its
Agreement and Declaration of Trust until further notice to the Distributor. The
President or any Vice President of the Fund shall have the power granted by said
provisions. After any such suspension the authority granted to the Distributor
by this paragraph 9 shall be reinstated only by a written instrument executed by
the Fund's President or any Vice President.
10. The Distributor shall keep and maintain adequate records in
respect of its activities which further the sale of shares. The Distributor is
authorized to direct the disposition of monies payable by the Fund pursuant to
the Fund's Rule 12b-1 Plan and, consequently, the Distributor shall provide to
the Fund's Board of Trustees, and the Trustees shall review, at least quarterly,
a written report of the amounts so expended and the purposes for which such
expenditures were made.
11. The Distributor agrees that it will not place orders for more
shares than are required to fill the requests received by it as agent of the
Fund and that it will expeditiously transmit all such orders to the Fund.
12. (a) This Agreement shall become effective June 20, 1996 and
shall continue in effect for a period of more than one year from its effective
date only as long as such continuance is approved, at least annually, by a vote
of the Board of Trustees of the Fund, and of the Trustees who are not
"Interested persons" of the Fund and have no direct or indirect financial
interest in the operation of the Fund's Rule 12b-1 Distribution Plan or in any
agreements related to the Fund's Rule 12b-1 Distribution Plan, cast in person at
a meeting called for the purpose of voting on such Agreement.
(b) This Agreement may be terminated at any time, without the
payment of any penalty, by vote of a majority of the members of the Board of
Trustees of the Fund who are not interested persons of the Fund and have no
direct or indirect financial interest in the operation of the Fund's Rule 12b-1
Distribution Plan or in any agreements related to the Fund's Rule 12b-1
Distribution Plan or by vote of a majority of the outstanding voting securities
of the Fund on not more than sixty days' written notice to the Distributor. This
Agreement shall automatically terminate in the event of its assignment by the
Distributor unless the United States Securities and Exchange Commission has
issued an order exempting the Fund and the Distributor from the provisions of
the Investment Company Act of 1940, as amended, which would otherwise have
effected the termination of this Agreement.
13. No amendment to this Agreement shall be executed or become
effective unless its terms have been approved in the manner described in
paragraph 12(a) above for approval of this Agreement.
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14. The Fund and the Distributor hereby each agree that all
literature and publicity issued by either of them referring directly or
indirectly to the Fund or to the Distributor shall be submitted to and receive
the approval of the Fund and the Distributor before the same may be used by
either party.
15. The Distributor agrees to use its best efforts in effecting the
sale and public distribution of the shares of the Fund and to perform its duties
in redeeming the shares of the Fund, but nothing contained in this Agreement
shall make the Distributor or any of its officers and trustees or shareholders
liable for any loss sustained by the Fund or the Fund's officers, trustees or
shareholders, or by any other person on account of any act done or omitted to be
done by the Distributor under this Agreement; provided, that nothing herein
contained shall protect the Distributor against any liability to the Fund or to
any of its shareholders to which the Distributor would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of its duties as Distributor or by reason of its reckless disregard of its
obligations or duties as Distributor under this Agreement. Nothing in this
Agreement shall protect the Distributor from any liabilities which it may have
under the Securities Act of 1933 or the Investment Company Act of 1940.
16. As used in this Agreement the terms "interested persons,"
"assignment," and "majority of the outstanding voting securities" shall have the
respective meanings specified in the Investment Company Act of 1940 as now in
effect.
17. This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, except to the extent such laws are preempted
by the Investment Company Act of 1940.
18. Any notice required to be given hereunder shall be sent via first
class mail to the address of the party as set forth above.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers on the day and year above written.
Attest: UAM FUNDS TRUST
/s/ Michael E. DeFao /s/ Norton H. Reamer
- ------------------------------------- -------------------------------
Michael E. DeFao, Secretary Norton H. Reamer, President
Attest: UAM FUND DISTRIBUTORS, INC.
/s/ Michael E. DeFao /s/ Gary French
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Michael E. DeFao, Secretary Gary French, President
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EXHIBIT I.(1)
Stradley Ronan Stevens & Young
Attorneys At Law
2600 One Commerce Square
Philadelphia, PA 19103-7098
(215) 564-8000
Fax215) 564-8120
Direct Dial: (215) 564-8101
August 18, 1994
The Regis Fund II
c/o Mutual Funds Service Company
P.O. Box 2798
Boston, MA 02208-2798
Gentlemen:
You have requested our opinion with respect to the shares of
beneficial interest to be offered upon effectiveness of your registration
statement filed with the Securities and Exchange Commission under the Securities
Act of 1933 and the Investment Company Act of 1940.
Based upon our review of such records, documents, and
representations as we have deemed relevant, it is our opinion that the shares of
beneficial interest to be sold and issued by The Regis Fund II, upon issuance,
sale and payment in accordance with the terms of sale contained in the
Prospectus, will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to
the registration statement covering the registration of the said shares under
the Securities Act of 1933 and the Investment Company Act of 1940, and
amendments thereto, and registration statements filed in accordance with the
securities laws of the various states in which shares of The Regis Fund II will
be offered, and we further consent to the fact this opinion concerning the
legality of the issue
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The Regis Fund II
Page 2
has been rendered by us.
Very truly yours,
STRADLEY, RONAN, STEVENS & YOUNG
By:/S/ Audrey C. Talley
Audrey C. Talley, a Partner
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Exhibit I.(2)
DRINKER BIDDLE & REATH LLP
1345 Chestnut Street
Philadelphia, PA 19107-3496
(215) 988-2700
July 10, 1998
UAM Funds Trust
c/o Chase Global Funds Service Center
P.O. Box 2798
Boston, MA 02208-2795
Re: UAM Funds Trust - Shares of Beneficial Interest
-----------------------------------------------
Gentlemen:
We have acted as counsel for UAM Funds Trust, a Delaware business trust,
("UAM") in connection with the registration by UAM of its shares of beneficial
interest, without par value. The Declaration and Agreement of Trust of UAM
authorize the issuance of an unlimited number of shares of beneficial interest,
which are divided into multiple series and classes (each a "Class" and
collectively "Classes"). The shares of beneficial interest designated into each
such series are referred to herein as the "Shares." You have asked for our
opinion on certain matters relating to the Shares.
We have reviewed UAM's Agreement and Declaration of Trust and By-laws,
resolutions of UAM's Board of Trustees ("Board"), certificates of public
officials and of UAM's officers and such other legal and factual matters as we
have deemed appropriate. We have also reviewed UAM's Registration Statement on
Form N-1A under the Securities Act of 1933 (the "Registration Statement"), as
amended through Post-Effective Amendment No. 24 thereto.
This opinion is based exclusively on the Delaware Business Trust Act and
the federal law of the United States of America.
We have assumed the following for purposes of this opinion:
1. The shares of beneficial interest have been issued in accordance with
the Agreement and Declaration of Trust and By-laws of UAM and resolutions of
UAM's Board relating to the creation, authorization and issuance of the Shares.
2. Prior to the issuance of any future Shares, the Board (a) will duly
authorize the issuance of such future Shares, (b) will determine with respect to
each class of such future Shares the preferences, limitations and relative
rights applicable thereto and (c) if such future Shares are classified into
separate series, will duly take the action necessary to create such
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UAM Funds Trust
July 10, 1998
Page 2
series and to determine the number of shares of such series and the relative
designations, preferences, limitations and relative rights thereof.
3. With respect to the future Shares, there will be compliance with the
terms, conditions and restrictions applicable to the issuance of such shares
that are set forth in (i) UAM's Agreement and Declaration of Trust and By-laws,
each as amended as of the date of such issuance, and (ii) the applicable future
series designations.
4. The Board will not change the preferences, limitations or relative
rights of any class or series of Shares after any shares of such class or series
have been issued.
Based upon the foregoing, we are of the opinion that:
1. UAM is authorized to issue an unlimited number of Shares.
2. UAM's Board is authorized (i) to create from time to time one or more
additional series or classes of Shares and (ii) to determine, at the time of
creation of any such series or class the designations, preferences, limitations
and relative rights thereof.
3. The Shares will be, when issued in accordance with, and sold for the
consideration described in the Registration Statement, validly issued, fully
paid and non-assessable by UAM, and that the holders of the Shares will be
entitled to the same limitation of personal liability extended to stockholders
of private corporations for profit organized under the general corporation law
of the State of Delaware (except that we express no opinion as to such holders
who are also trustees of UAM).
We consent to the filing of this opinion with Post-Effective Amendment No.
24 to the Registration Statement to be filed by UAM with the Securities and
Exchange Commission.
Very truly yours,
/s/ DRINKER BIDDLE AND REATH LLP
--------------------------------
DRINKER BIDDLE AND REATH LLP
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Exhibit J.
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectuses and
Statements of Additional Information constituting parts of this Post-Effective
Amendment No. 24 to the registration statement on Form N-1A (the "Registration
Statement") of our reports dated June 3, 1998, relating to the financial
statements and financial highlights appearing in the April 30, 1998 Annual
Reports to the Shareholders of The TJ Core Equity Portfolio, Jacobs
International Octagon Portfolio, BHM&S Total Return Bond Portfolio, MJI
International Equity Portfolio, Hanson Equity Portfolio, Chicago Asset
Management Value/Contrarian Portfolio and Chicago Asset Management Intermediate
Bond Portfolio, which are also incorporated by reference into the Registration
Statement.
We hereby consent to the incorporation by reference in the Prospectuses and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 24 to the registration statement on Form N-1A (the "Registration
Statement") of our report dated April 29, 1998, relating to the financial
statements and financial highlights appearing in the March 31, 1998 Annual
Report to the Shareholders of the FPA Crescent Portfolio, which are also
incorporated by reference into the Registration Statement.
We also consent to the references to us under the headings "Financial
Statements" and "Independent Accountants" in the Statements of Additional
Information and to the references to us under the headings "Financial
Highlights", "Accountants" and "Reports" in the Prospectuses.
PricewaterhouseCoopers LLP
Boston, Massachusetts
July 7, 1998
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EXHIBIT L.
PURCHASE AGREEMENT
The Regis Fund II (the "Trust"), a Delaware business trust, and United
Asset Management Corporation, a Delaware Corporation, hereby agree as follows:
1. The Trust hereby offers and United Asset Management Corporation hereby
purchases 2,500 shares of beneficial interest representing an interest in the
Chicago Asset Management Value/Contrarian Portfolio, 2,500 shares of beneficial
interest representing an interest in the Chicago Asset Management Intermediate
Bond Portfolio, 2,500 shares of beneficial interest representing an interest in
MJI Global Bond Portfolio, and 2,500 shares of beneficial interest in MJI
International Equity Portfolio of the Fund (the "Shares") at a price of $10 per
share. United Asset Management Corporation hereby acknowledges purchase of the
Shares and the Trust hereby acknowledges receipt from United Asset Management
Corporation of funds in the amount of $100,000 in full payment of the Shares.
It is further agreed that no certificate for the Shares will be issued by the
Trust.
2. United Asset Management Corporation represents and warrants to the
Trust that the Shares are being acquired for investment purposes and not with a
view to the distribution thereof.
3. The names "The Regis Fund II" and "Trustees of The Regis Fund II"
refer, respectively, to the Trust created and the Trustees as Trustees but not
individually or personally, acting from time to time under an Agreement and
Declaration of Trust dated May 18, 1994, to which reference is hereby made, and
to any and all amendments thereto. The obligations of The Regis Fund II entered
into in the name or on behalf thereof by any of the Trustees, representatives or
agents are not made individually, but only in such capacities, and are not
binding upon any of the Trustees, Shareholders or representatives of the trust
personally, but bind only the assets of the Trust, and all persons dealing with
any series of Shares of the Trust must look solely to the assets of the Trust
belonging to such series for the enforcement of any claims against the Trust.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 18th day of August, 1994.
Attest: THE REGIS FUND II
/s/ Kathleen M. O'Neill By: /s/ Karl O. Hartmann
- ------------------------ ---------------------------
Karl O. Hartmann, Secretary
Attest: UNITED ASSET MANAGEMENT CORPORATION
/s/ Kathleen M. O'Neill By: /s/ Richard S. Robie, III
- ------------------------ -------------------------------------
Richard S. Robie, III, Vice President
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EXHIBIT M.1.
UAM FUNDS TRUST
DISTRIBUTION PLAN
INTRODUCTION
- ------------
This Distribution Plan (the "Plan") has been adopted pursuant to Rule
12b-1 under the Investment Company Act of 1940 (the "Act") by UAM Funds Trust
(the "Fund"), for the portfolios and classes of the Fund's portfolios. The Plan
has been approved by the Board of Trustees, including a majority of the Trustees
and trustees who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plan or in any agreements
related thereto, cast in person at a meeting called for the purpose of voting on
such Plan. Such approval by the trustees included a determination that in the
exercise of reasonable business judgment and in light of their fiduciary duties,
there is a reasonable likelihood that the Plan will benefit the portfolios and
classes of its portfolios and its shareholders. The Plan has been approved, or
will be approved, by a vote of the holders of a majority of the outstanding
voting securities, as defined in the Act of each portfolio or class of shares of
a portfolio distributed pursuant to the Plan, prior to the implementation of the
Plan with respect to such portfolio or such class of shares of a portfolio, if
adopted after any public offering of the portfolio's voting securities or the
sale of shares of a portfolio to persons who are not affiliated persons of the
portfolio, affiliated persons of such persons, promoters of the Fund, or
affiliated persons of such promoters.
Each portfolio of the Fund is managed by an investment adviser which
is registered as such with the Securities and Exchange Commission under the
Investment Advisers Act of 1940 and which is a wholly-owned subsidiary or
affiliate of United Asset Management Corporation. The investment adviser serves
as manager of the portfolios pursuant to an investment advisory agreement
approved by the Board of Trustees and shareholders of the Fund.
The Fund is authorized to issue different series of securities and is
an open-end management investment company registered under the Act. UAM Fund
Distributors, Inc. (the "Distributor") is the principal underwriter and national
distributor for the Fund's shares pursuant to a Distribution Agreement approved
by the Board.
The Distributor may enter into agreements with other registered
broker-dealers, consultants, recordkeepers, accounting agents and other Service
Providers in the implementation of this Plan and of the Distribution Agreement
between it and the Fund. The Fund may, in addition, enter into arrangements
with other than broker-dealers and Service Providers which are not "affiliated
persons" or "interested persons" of the Fund or the Distributor to provide to
the Fund services in the Fund's marketing of its shares (the "Service
Providers").
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* * *
The Plan provides that:
1. The Fund may pay a monthly fee not to exceed 0.75% per annum of the Fund's
daily average net assets (the "Maximum Amount") to reimburse the Distributor,
other broker-dealers or Service Providers for amounts expended by them under the
terms of this Plan.
2. (a) The Distributor shall be reimbursed pursuant to paragraph 1 above for
monies expended to furnish, or cause or encourage others to furnish, services
and incentives in connection with the promotion, offering and sale of the Fund's
shares and, where suitable and appropriate, the retention of the Fund's shares
by shareholders.
(b) To the extent that Service Providers are paid directly by the Fund,
such Service Providers, shall use the monies paid respectively to them to
reimburse themselves for the actual costs they have incurred in providing
distribution-related services including but not limited to: advertising the
availability of services and products; designing material to send to customers
and developing methods of making such materials accessible to customers;
providing information about the product needs of customers; providing facilities
to solicit Fund sales and to answer questions from prospective and existing
investors about the Fund; receiving and answering correspondence from
prospective investors, including requests for sales literature, prospectuses and
statements of additional information; displaying and making sales literature and
prospectuses available; acting as liaison between shareholders and the Fund,
including obtaining information from the Fund and providing performance and
other information about the Fund.
3. The Distributor shall report to the Fund at least monthly on the amount and
the use of the monies paid to it under the Plan. To the extent paid directly by
the Fund, the Service Providers shall inform the Fund monthly and in writing of
the amounts each claims under the Service Agreement and the Plan; both the
Distributor and the Service Providers shall furnish the Board of Trustees of the
Fund with such other information as the Board may reasonably request in
connection with the payments made under the Plan and the use thereof by the
Distributor and the Service Providers, respectively, in order to enable the
Board to make an informed determination of the amount of the Fund's payments and
whether the Plan should be continued.
4. The officers of the Fund shall furnish to the Board of Trustees of the Fund,
for their review, on a quarterly basis, a written report of the amounts expended
under the Plan and the purposes for which such expenditures were made.
5. This Plan shall remain in effect as to a portfolio or class of shares of a
portfolio of the Fund only if it is approved by the vote of a majority of the
respective portfolio's or class's outstanding voting securities as defined in
the Act when such approval is required by the Act; thereafter, it shall continue
in effect for a period of more than one year from the date of its execution or
adoption only so long as such continuance is specifically approved at least
annually by a vote of the Board of Trustees of the Fund, and of the trustees who
are not interested persons of the Fund and have no direct or indirect financial
interest in
2
<PAGE>
the operation of the Plan or in any agreements related to the Plan ("non-
interested trustees"), cast in person at a meeting called for the purpose of
voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a majority of the
non-interested trustees or by vote of a majority of the respective portfolio's
or class's outstanding voting securities.
(b) The Plan may not be amended to increase materially the amount to be
spent for distribution pursuant to paragraph 1 thereof without approval by the
respective portfolio's or class's shareholders.
7. The Distribution Agreement between the Fund and the Distributor, and the
Service Agreements between the Fund and the Service Providers, shall
specifically have a copy of this Plan attached to, and its terms and provisions
incorporated respectively by reference in, such agreements.
8. All material amendments to this Plan shall be approved by the non-interested
trustees in the manner described in paragraph 5 above.
9. So long as the Plan is in effect, the selection and nomination of the Fund's
non-interested trustees shall be committed to the discretion of such non-
interested trustees.
10. The definitions contained in Sections 2(a)(3), 2(a)(4), 2(a)(19) and
2(a)(42) of the Act shall govern the meaning of "affiliated person,"
"assignment," "interested person(s)" and "vote of a majority of the outstanding
voting securities," respectively, for purposes of this Plan.
This Plan shall take effect on the date of the public offering of the
respective portfolio or class of shares of a portfolio, unless a different date
has been designated as the Plan's effective date by the Board of the Fund.
Approved June 18, 1998
3
<PAGE>
EXHIBIT M.2.
UAM FUND DISTRIBUTORS, INC.
211 CONGRESS STREET
BOSTON, MASSACHUSETTS 02110
--------------------------------
SELLING DEALER AGREEMENT
UAM FUNDS, INC. AND UAM FUNDS TRUST
(Institutional Class Shares)
--------------------------------
Dealer: ________________________
Gentlemen:
We invite you, as a selected dealer, to participate as principal in the
distribution of the Institutional Class Shares (the "Shares") of the Portfolios
of UAM Funds, Inc. and of UAM Funds Trust (each Portfolio is referred to herein
as the "Fund") with respect to which we have been retained to act as exclusive
national distributor and which are offered for sale pursuant to currently
effective federal Prospectuses describing such Shares.
OFFERING PRICE TO PUBLIC:
- -------------------------
Orders for Shares received from you and accepted by the Fund, will be at
the public offering price applicable to each order as set forth in that Fund's
Prospectus relating to such Shares. The manner of computing the net asset value
of Shares, the public offering price and the effective time of orders received
from you are described in the Prospectuses for the Shares. We reserve the
right, at any time and without notice, to suspend the sale of Fund Shares.
SALES, ORDERS AND CONFIRMATIONS:
- --------------------------------
In offering Fund Shares to the public or otherwise, you shall act as dealer
for your own account, and in no transaction shall you have any authority to act
as agent for the Fund, for any other selected dealer or for us. No person is
authorized to make any representation concerning the Shares or any Fund except
those contained in the relevant and current Prospectus and in written
information issued by the Fund or by us as a supplement to such Prospectus. In
purchasing Fund Shares, you shall rely solely on such representations contained
in the Prospectus and in such written supplemental information.
All sales are made subject to confirmation and orders are subject to
acceptance or rejection by the Fund in its sole discretion. Your orders must be
wired, telephoned or written to the Fund as provided in the relevant and current
Prospectus. You agree to place orders for the
<PAGE>
same number of Shares sold by you at the price at which such Shares are sold.
You agree that you will not purchase Shares except for investment or for the
purpose of covering purchase orders already received and that you will not, as
principal, sell Fund Shares unless purchased by you from the Fund under the
terms hereof. You also agree that you will not withhold placing with us orders
received from your customers so as to profit yourself from such withholding.
Each of your orders shall be confirmed by you in writing on the same day.
PAYMENT AND ISSUANCE OF CERTIFICATES:
- -------------------------------------
The Shares purchased by you hereunder shall be paid for in full at the
public offering price, by check payable to the Fund, at its office, within three
business days after our acceptance of your order. If not so paid, we reserve
the right to cancel the sale and to hold you responsible for any loss sustained
by us or the Fund (including lost profit) in consequence. Certificates
representing the Shares will not be issued unless a specific request is received
from the purchaser. Certificates, if requested, will be issued in the names
indicated by registration instructions accompanying your payment.
REDEMPTIONS:
- ------------
The relevant Prospectus describes the provisions whereby a Fund, under all
ordinary circumstances, will redeem Shares held by shareholders on demand. You
agree that you will not make any representations to shareholders relating to the
redemption of their Shares other than the statements contained in the relevant
and current Prospectus, and the underlying organizational documents of the Fund,
to which it refers, and that you will quote as the redemption price only the
price determined by the Fund. You shall not repurchase any Shares from your
customers at a price below that next quoted by the Fund for redemption. You may
hold such repurchased Shares for investment purposes or submit such Shares to
the Fund for redemption.
DISTRIBUTION AND/OR SERVICE FEES:
- ---------------------------------
We expect you to provide distribution and marketing services (the
"Services") in the promotion of the sale of the Shares of such Fund and the
retention of assets by such Fund and/or services and assistance to your
customers who own Fund Shares, including but not limited to, answering routine
inquiries regarding the Shares or a Fund or the status of a customer's account
and providing information to customers relating to maintaining their investment
in the Fund. Certain of the managers (the "Managers") of the Funds may, from
time to time, determine to provide support for the distribution and marketing
of, and/or the provision of services to the holders of, the Shares in the form
of payments or additional payments to selected broker-dealers who enter into
Selling Dealer Agreements with us. Accordingly, for your Services in respect of
Shares of any Fund the Manager of which has determined to provide such support
and has adopted a Supplemental Plan (a "Supplemental Plan"), you will receive a
supplemental fee (the "Supplemental Fees"), as established by each particular
Manager from time to time, subject to the further provisions of this Agreement,
the terms of the then current and applicable Prospectus relating to such Shares
and the instructions received by us from such Manager. The Supplemental Fees,
if any, in respect of Shares of a particular Fund may be based on such factors
as initial and/or current purchase prices or net asset values of such Shares
acquired by or held in
2
<PAGE>
the accounts of your customers or certain customers and the periods for which
such shares have been held and may be subject to such other minimums as may be
established by the Managers or by us from time to time. Such Supplemental Fees
may consist of a conversion fee component, if any, and/or a new contribution fee
component, if any, the rates of which shall be as provided in the schedule of
fees set forth in Appendix A attached hereto, as the same may be amended by us
at any time and from time to time by notice thereof to you; provided, however,
that in no event shall the rate of any such component be in excess of the
current rates set forth in any form of subsequent notice furnished to you by us
or on our behalf, or by the Manager or the Fund.
We reserve the right, at any time, without notice, to modify, suspend or
terminate payments hereunder, or any component of such payments, either with
respect to one or more Funds or classes of Shares or generally with respect to
the Funds and the Shares; and the payment of Supplemental Fees hereunder shall
be automatically suspended or terminated if and to the extent that payments from
the relevant Manager are suspended or terminated, or automatically reduced if
and to the extent that the corresponding rates of payments to be made from the
relevant Manager are reduced. Any such action may be for any reason whatsoever
or no reason at all; and you agree that you shall not be entitled to any
payments for any period after the effective date of any such suspension or
termination, nor shall you be entitled to any payments after the effective date
of any such modification or reduction except as may be calculated pursuant to a
modified or reduced schedule of fees substituted for the previously effective
schedule.
You understand and agree that we merely administer and forward payments
pursuant to the Supplemental Plans of the Managers and that we shall have no
liability to you for such payments. Accordingly, you agree that anything to the
contrary herein notwithstanding (i) we shall have no liability to you, and you
shall have no recourse whatsoever against us or our assets, for any payment for
which provision is made in this Agreement, and (ii) your sole recourse, if any,
in respect of any such payment for which provision is made in this Agreement
shall be against the respective Manager.
LEGAL COMPLIANCE:
- -----------------
This Agreement and any transaction with, or payments to, you pursuant to
the terms hereof is conditioned on each party's representation to the other
party that, as of the date of this Agreement it is, and at all times during the
effectiveness of this Agreement it will be, a registered broker-dealer under the
Securities Exchange Act of 1934, as amended, and qualified under applicable
state securities laws in each jurisdiction in which the actions contemplated to
be taken by it under this Agreement require it to be qualified to act as a
broker-dealer in securities, and a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"). Each party agrees to
notify the other promptly in writing and immediately suspend sales of Shares if
this representation ceases to be true. Each party also agrees that it will
comply with the rules of the NASD including, in particular, Sections 2, 21(c)
and 26 of Article III of its Rules of Fair Practice, as amended, and that each
party will maintain adequate records with respect to its transactions with the
other and the Funds.
BLUE SKY MATTERS:
- -----------------
3
<PAGE>
We shall have no obligation or responsibility with respect to your right to
sell Shares in any state or jurisdiction. We may furnish you with information
identifying the states and jurisdictions where the Shares of a Fund are
qualified for sale; and you will not transact orders for Shares except in such
states and jurisdictions as identified by us.
LITERATURE:
- -----------
We will furnish you with copies of each Fund's relevant Prospectus and
sales literature (if any) and other information made publicly available by us or
the Fund which relate to the Fund or the Shares of such Fund, in reasonable
quantities upon your request. You agree to deliver a copy of the current and
relevant Prospectus in accordance with the provisions of the Securities Act of
1933 to each purchaser of Shares. We shall file Fund sales literature and
promotional material with the NASD as required. You may not publish or use any
sales literature or promotional materials with respect to the Shares, the Funds
or any Fund without our prior review and written approval.
NOTICES AND COMMUNICATIONS:
- ---------------------------
All communications from you (other than purchase and sale orders) should be
addressed to us at 211 Congress Street, Boston, Massachusetts 02110, Attention:
Compliance Officer. Any notice from us to you shall be deemed to have been duly
given if mailed or telegraphed to you at the address set forth below. Each of
us may change the address to which notices shall be sent by notice to the other
in accordance with the terms hereof.
TERMINATION:
- ------------
This Agreement may be terminated by either party at any time by written
notice to that effect and will terminate without notice upon the appointment of
a trustee for you under the Securities Investor Protection Act, or any other act
of insolvency by you. Notwithstanding the termination of this Agreement, you
shall remain liable for any amounts otherwise owing to us or the Funds and for
your portion of any transfer tax or other liability which may be asserted or
assessed against the Fund, or us.
AMENDMENT:
- ----------
This Agreement may be amended or revised to modify, suspend or terminate
payments hereunder as provided in the section above entitled "DISTRIBUTION
AND/OR SERVICE FEES" or to amend Appendix A as provided in said section. This
Agreement may be otherwise amended or revised at any time by us upon notice to
you and you will be deemed to have accepted any such other amendment or revision
upon placing any subsequent order for Shares.
GENERAL:
- --------
Your acceptance hereof will constitute an obligation on your part to
observe all the terms and conditions hereof. In the event that you breach any
of the terms and conditions of this
4
<PAGE>
Agreement, you will indemnify us, the Funds, and our affiliates for any damages,
losses, costs and expenses (including reasonable attorneys' fees and expenses)
arising out of or relating to such breach. In the event that we breach any of
the terms and conditions of this Agreement, we will indemnify you and your
affiliates for any damages, losses, costs and expenses (including reasonable
attorneys' fees and expenses) arising out of or relating to such breach. Nothing
contained herein shall constitute you, us and any dealers an association or
partnership. All references in this Agreement to the "Prospectus" refer to the
then current and relevant version of the Prospectus of the particular Fund or
Funds concerned and include the Statement of Additional Information incorporated
by reference therein and any stickers or supplements thereto.
This Agreement is to be construed in accordance with the laws of The
Commonwealth of Massachusetts.
Please confirm this Agreement by dating and executing, by your duly
authorized representative, one copy of this Agreement below and return it to us.
Keep the enclosed duplicate copy for your records.
UAM FUND DISTRIBUTORS, INC.
BY:__________________________________
(Name of Officer and Title)
5
<PAGE>
SELECTED DEALER AGREEMENT ACCEPTANCE
------------------------------------
UAM FUND DISTRIBUTORS, INC.
The undersigned hereby confirms its acceptance of, and agreement to the
terms of, the foregoing Selected Dealer Agreement and acknowledges that any
purchase of Fund Shares made during the effectiveness of this Agreement is
subject to all the applicable terms and conditions set forth in this Agreement,
and agrees to pay for the shares at the price and upon the terms and conditions
stated in the Agreement. The undersigned hereby acknowledges receipt of
Prospectuses relating to the Fund Shares and confirms that, in executing this
Selected Dealer Agreement, it has relied on such Prospectuses and not on any
other statement whatsoever, written or oral.
PLEASE SIGN HERE AND COMPLETE BELOW
___________________________________________
(Full Corporate Name of Broker-Dealer)
By:________________________________________
(Name of Officer and Title)
___________________________________________
(Broker-Dealer's Tax Identification No,)
___________________________________________
(Notice Address -- Please include name
of compliance contact)
Date:______________________________________
6
<PAGE>
APPENDIX A
SCHEDULE OF FEES
SUPPLEMENTAL FEES
(FOR CERTAIN DEFINED CONTRIBUTION PLANS ONLY)
Supplemental fees for each broker-dealer will be determined quarterly as of
the end of each calendar quarter. Each quarterly fee shall consist of
CONVERSION COMPONENTS, if any, and NEW CONTRIBUTION COMPONENTS, if any.
There shall be a CONVERSION COMPONENT with respect to each new shareholder
account established through the purchase of Shares of the Funds subject to the
further terms and conditions stated in this paragraph. The aggregate purchase
price of Shares of the Funds initially acquired by the account must have been at
least $1,000,000 and the account must have been in existence for at least one
full calendar quarter. The portion of the CONVERSION COMPONENT attributable to
the Shares of each Fund initially acquired by such account shall be calculated
by applying the quarterly rate of the CONVERSION COMPONENT for that Fund, as
specified below, to the aggregate purchase price of the Shares of that Fund
initially acquired. The amount so calculated shall be included in the fee with
respect to such account for each of the four (4) full calendar quarters
following the establishment of the account; provided, however, that such
CONVERSION COMPONENT shall not be payable with respect to, or included in the
fee for, any such quarter if, as of the last business day of such quarter, the
number of Shares of the Funds (adjusted, if necessary, to give effect to
exchanges) held in the account has been reduced to less than ninety (90) percent
of the number of Shares initially acquired by such account, nor shall a
CONVERSION COMPONENT be payable for any quarter subsequent thereto.
There shall be a NEW CONTRIBUTION COMPONENT for each shareholder account
which existed at the beginning of a calendar quarter subject to the further
terms and conditions stated in this paragraph. The account must have made a
QUALIFYING PURCHASE of Shares of a Fund or Funds during the quarter concerned.
A QUALIFYING PURCHASE means an aggregate investment of at least $100,000 in the
Shares of the Funds. The portion of the NEW CONTRIBUTION COMPONENT attributable
to the Shares of each Fund acquired by such account as part of a QUALIFYING
PURCHASE shall be calculated by applying the single payment rate of the NEW
CONTRIBUTION COMPONENT for that Fund, as specified below, to the portion of the
QUALIFYING PURCHASE made in Shares of that Fund and aggregating the amounts for
all such Funds the Shares of which were included in such QUALIFYING PURCHASE.
The aggregate amount of the NEW CONTRIBUTION COMPONENT so determined shall be
included in the supplemental fees for the single quarter concerned.
7
<PAGE>
<TABLE>
<CAPTION>
NEW
CONVERSION CONTRIBUTION
NAME OF FUND COMPONENT COMPONENT
- ------------ ---------- ------------
<S> <C> <C>
Acadian Emerging Markets Portfolio (I) * 0.25%
Acadian International Equity Portfolio (I) * 0.25%
BHM&S Total Return Bond Portfolio (I) * 0.25%
C&B Balanced Portfolio (I) * 0.25%
C&B Equity Portfolio (I) * 0.25%
C&B Equity Portfolio for Taxable Investors(I) * 0.25%
C&B Mid Cap Equity Portfolio (I) * 0.25%
Chicago Asset Management Intermediate Bond Portfolio (I) * 0.25%
Chicago Asset Management Value/Contrarian Portfolio (I) * 0.25%
DSI Balanced Portfolio (I) * 0.25%
DSI Disciplined Value Portfolio (I) * 0.25%
DSI Limited Maturity Bond Portfolio (I) * 0.25%
FMA Small Company Portfolio (I) * 0.25%
ICM Equity Portfolio (I) * 0.25%
ICM Fixed Income Portfolio (I) * 0.25%
Jacobs International Octagon Portfolio (I) * 0.25%
McKee Domestic Equity Portfolio (I) * 0.25%
McKee International Equity Portfolio (I) * 0.25%
McKee Small Cap Equity Portfolio (I) * 0.25%
McKee U.S. Government Portfolio (I) * 0.25%
MJI International Equity Portfolio (I) * 0.25%
NWQ Balanced Portfolio (I) * 0.25%
NWQ Small Cap Value Portfolio (I) * 0.25%
NWQ Special Equity Portfolio (I) * 0.25%
NWQ Value Equity Portfolio (I) * 0.25%
Rice, Hall, James Small Cap Portfolio (I) * 0.25%
Rice, Hall, James Small/Mid Cap Portfolio (I) * 0.25%
SAMI Preferred Stock Income Portfolio (I) * 0.25%
Sirach Bond Portfolio (I) * 0.25%
</TABLE>
8
<PAGE>
<TABLE>
<S> <C> <C>
Sirach Equity Portfolio (I) * 0.25%
Sirach Growth Portfolio (I) * 0.25%
Sirach Special Equity Portfolio (I) * 0.25%
Sirach Strategic Balanced Portfolio (I) * 0.25%
Sterling Partners' Balanced Portfolio (I) * 0.25%
Sterling Partners' Equity Portfolio (I) * 0.25%
Sterling Small Cap Value Portfolio (I) * 0.25%
TS&W Balanced Portfolio (I) * 0.25%
TS&W Equity Portfolio (I) * 0.25%
TS&W Fixed Income Portfolio (I) * 0.25%
TS&W International Equity Portfolio (I) * 0.25%
</TABLE>
_____________________
* At the quarterly rate of 0.125% on the first $3,000,000 of initial assets and
0.0625% on the excess of such assets over $3,000,000.
9
<PAGE>
UAM FUND DISTRIBUTORS, INC.
---------------------------
UAM Fund Distributors, Inc., the distributor of the UAM Funds, Inc. and UAM
Funds Trust (collectively, the "Funds"), is a member of the National Securities
Clearing Corporation ("NSCC") Fund/Serv. Accordingly, transactions in shares of
portfolios of the Funds may be processed through Fund/Serv. If you are
interested in utilizing Fund/Serv, please provide the information requested
below.
Firm Name: ____________________________________
Address: ____________________________________
____________________________________
____________________________________
NSCC Dealer #: ________________________
NSCC Dealer Alpha Code: ________________________
NSCC Clearing #: ________________________
Phone Number: ________________________
Fax Number: ________________________
Mutual Fund Contact: ________________________
UAM Fund Distributors, Inc. has also executed and filed with the NSCC the
Investment Company Institute's ("ICI") Standard Networking Agreement. Provided
your firm has also executed and filed such agreement, Networking may be
utilized. If your firm wishes to utilize Networking, please complete the below
acknowledgment. By completing this acknowledgment, you agree that your firm
will participate in Networking under the terms of the ICI Standard Agreement.
ACKNOWLEDGMENT
Firm: ____________________________
By: _____________________________
Name:
Title:
Date:
10
<PAGE>
UAM FUND DISTRIBUTORS, INC.
211 CONGRESS STREET
BOSTON, MASSACHUSETTS 02110
________________________
SELLING DEALER AGREEMENT
UAM FUNDS, INC. AND UAM FUNDS TRUST
(Institutional Service Class Shares)
________________________
Dealer: ___________________.
Gentlemen:
We invite you, as a selected dealer, to participate as principal in the
distribution of the Institutional Service Class Shares (the "Shares") of the
Portfolios of UAM Funds, Inc. and of UAM Funds Trust (each Portfolio is referred
to herein as the "Fund") with respect to which we have been retained to act as
exclusive national distributor and which are offered for sale pursuant to
currently effective federal Prospectuses describing such Shares.
OFFERING PRICE TO PUBLIC:
- -------------------------
Orders for Shares received from you and accepted by the Fund, will be at
the public offering price applicable to each order as set forth in that Fund's
Prospectus relating to such Shares. The manner of computing the net asset value
of Shares, the public offering price and the effective time of orders received
from you are described in the Prospectuses for the Shares. We reserve the
right, at any time and without notice, to suspend the sale of Fund Shares.
SALES, ORDERS AND CONFIRMATIONS:
- --------------------------------
In offering Fund Shares to the public or otherwise, you shall act as dealer
for your own account, and in no transaction shall you have any authority to act
as agent for the Fund, for any other selected dealer or for us. No person is
authorized to make any representation concerning the Shares or any Fund except
those contained in the relevant and current Prospectus and in written
information issued by the Fund or by us as a supplement to such Prospectus. In
purchasing Fund Shares, you shall rely solely on such representations contained
in the Prospectus and in such written supplemental information.
All sales are made subject to confirmation and orders are subject to
acceptance or rejection by the Fund in its sole discretion. Your orders must be
wired, telephoned or written to the Fund as provided in the relevant and current
Prospectus. You agree to place orders for the same number of Shares sold by you
at the price at which such Shares are sold. You agree that you will not
purchase Shares except for investment or for the purpose of covering purchase
orders already received and that you will not, as principal, sell Fund Shares
unless purchased by
11
<PAGE>
you from the Fund under the terms hereof. You also agree that you will not
withhold placing with us orders received from your customers so as to profit
yourself from such withholding. Each of your orders shall be confirmed by you in
writing on the same day.
PAYMENT AND ISSUANCE OF CERTIFICATES:
- -------------------------------------
The Shares purchased by you hereunder shall be paid for in full at the
public offering price, by check payable to the Fund, at its office, within three
business days after our acceptance of your order. If not so paid, we reserve
the right to cancel the sale and to hold you responsible for any loss sustained
by us or the Fund (including lost profit) in consequence. Certificates
representing the Shares will not be issued unless a specific request is received
from the purchaser. Certificates, if requested, will be issued in the names
indicated by registration instructions accompanying your payment.
REDEMPTIONS:
- ------------
The relevant Prospectus describes the provisions whereby a Fund, under all
ordinary circumstances, will redeem Shares held by shareholders on demand. You
agree that you will not make any representations to shareholders relating to the
redemption of their Shares other than the statements contained in the relevant
and current Prospectus, and the underlying organizational documents of the Fund,
to which it refers, and that you will quote as the redemption price only the
price determined by the Fund. You shall not repurchase any Shares from your
customers at a price below that next quoted by the Fund for redemption. You may
hold such repurchased Shares for investment purposes or submit such Shares to
the Fund for redemption.
DISTRIBUTION AND/OR SERVICE FEES:
- ---------------------------------
We expect you to provide distribution and marketing services (the
"Services") in the promotion of the sale of the Shares of such Fund and the
retention of assets by such Fund and/or services and assistance to your
customers who own Fund Shares, including but not limited to, answering routine
inquiries regarding the Shares or a Fund or the status of a customer's account
and providing information to customers relating to maintaining their investment
in the Fund.
12B-1 PLANS:
------------
For your Services in respect of Shares of any Fund that has a
Distribution Plan under Rule 12b-1 (a "12b-1 Plan") of the Investment
Company Act of 1940 (the "1940 Act"), you will receive a fee (the "12b-1
Fee"), as established by us and the Fund from time to time, pursuant to the
provisions of the 12b-1 Plan of such Fund relating to such Shares, subject
to the further provisions of this Agreement, the terms of the then current
and applicable Prospectus relating to such Shares and the provisions of the
relevant 12b-1 Plan. The 12b-1 Fee in respect of Shares of a particular
Fund shall be based on the net asset value of such Shares held in the
accounts of your customers, provided that such Shares so held have an
aggregate net asset value of at least the minimum amount established by us
from time to time. Such 12b-1 Fee shall consist of a distribution fee
component, if any, and/or a service fee component, if any, the rates of
which shall be as provided in the schedule of fees set forth in Appendix A
attached hereto, as the same may
12
<PAGE>
be amended by a Fund or by us at any time and from time to time by notice
thereof to you; provided, however, that in no event shall the rate of any
such component be in excess of the current rates set forth in the then
current and applicable Prospectus relating to such Shares and the
provisions of the relevant 12b-1 Plan.
SUPPLEMENTAL PLANS (FOR CERTAIN DEFINED CONTRIBUTION PLANS):
------------------------------------------------------------
Certain of the managers (the "Managers") of the Funds may, from time
to time, determine to provide additional support, under certain
circumstances, for the distribution and marketing of, and/or the provision
of services to the holders of, the Shares in the form of payments or
additional payments to selected broker-dealers who enter into Selling
Dealer Agreements with us. Such additional payments will be made only when
the Shares are used as part of a defined contribution product, and you
provide, or cause to be provided, additional support to the defined
contribution plan, its sponsors, or its participants with respect to such
things as investment selection, investment style, and other characteristics
such as performance of the Funds. Accordingly, for providing such
additional services in respect of Shares of any Fund the Manager of which
has determined to provide such additional support and has adopted a
Supplemental Plan (a "Supplemental Plan"), you may receive a supplemental
fee (the "Supplemental Fees"), as established by each particular Manager
from time to time, subject to the further provisions of this Agreement, the
terms of the then current and applicable Prospectus relating to such Shares
and the instructions received by us from such Manager. The Supplemental
Fees, if any, in respect of Shares of a particular Fund may be based on
such factors as initial and/or current purchase prices or net asset values
of such Shares acquired by or held in the accounts of your customers or
certain customers and the periods for which such shares have been held and
may be subject to such other minimums as may be established by the Managers
or by us from time to time. Such Supplemental Fees may consist of a
conversion fee component, if any, and/or a new contribution fee component,
if any, the rates of which shall be as provided in the schedule of fees set
forth in Appendix A attached hereto, as the same may be amended by us at
any time and from time to time by notice thereof to you; provided, however,
that in no event shall the rate of any such component be in excess of the
current rates set forth in any form of subsequent notice furnished to you
by us or on our behalf, or by the Manager or the Fund.
We reserve the right, at any time, without notice, to modify, suspend or
terminate payments hereunder, or any component of such payments, either with
respect to one or more Funds or classes of Shares or generally with respect to
the Funds and the Shares; and (i) the payment of 12b-1 Fees hereunder shall be
automatically suspended or terminated if and to the extent that payments under
the relevant 12b-1 Plan are suspended or terminated, or automatically reduced if
and to the extent that the corresponding rates of payments to be made under the
relevant 12b-1 Plan are reduced; and (ii) the payment of Supplemental Fees
hereunder shall be automatically suspended or terminated if and to the extent
that payments from the relevant Manager are suspended or terminated, or
automatically reduced if and to the extent that the corresponding rates of
payments to be made from the relevant Manager are reduced. Any such action may
be for any reason whatsoever or no reason at all; and you agree that you shall
not be entitled to any payments for any period after the effective date of any
such suspension or
13
<PAGE>
termination, nor shall you be entitled to any payments after the effective date
of any such modification or reduction except as may be calculated pursuant to a
modified or reduced schedule of fees substituted for the previously effective
schedule.
You understand and agree that we merely administer and forward payments
pursuant to the 12b-1 Plans of the Funds and/or the Supplemental Plans of the
Managers and that we shall have no liability to you for such payments.
Accordingly, you agree that anything to the contrary herein notwithstanding (i)
we shall have no liability to you, and you shall have no recourse whatsoever
against us or our assets, for any payment for which provision is made in this
Agreement, and (ii) your sole recourse, if any, in respect of any such payment
for which provision is made in this Agreement shall be against the respective
Fund or Manager, as the case may be.
LEGAL COMPLIANCE:
- ----------------
This Agreement and any transaction with, or payments to, you pursuant to
the terms hereof is conditioned on each party's representation to the other
party that, as of the date of this Agreement it is, and at all times during the
effectiveness of this Agreement it will be, a registered broker-dealer under the
Securities Exchange Act of 1934, as amended, and qualified under applicable
state securities laws in each jurisdiction in which the actions contemplated to
be taken by it under this Agreement require it to be qualified to act as a
broker-dealer in securities, and a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"). Each party agrees to
notify the other promptly in writing and immediately suspend sales of Shares if
this representation ceases to be true. Each party also agrees that it will
comply with the rules of the NASD including, in particular, Sections 2, 21(c)
and 26 of Article III of its Rules of Fair Practice, as amended, and that each
party will maintain adequate records with respect to its transactions with the
other and the Funds.
BLUE SKY MATTERS:
- -----------------
We shall have no obligation or responsibility with respect to your right to
sell Shares in any state or jurisdiction. We may furnish you with information
identifying the states and jurisdictions where the Shares of a Fund are
qualified for sale; and you will not transact orders for Shares except in such
states and jurisdictions as identified by us.
LITERATURE:
- -----------
We will furnish you with copies of each Fund's relevant Prospectus and
sales literature (if any) and other information made publicly available by us or
the Fund which relate to the Fund or the Shares of such Fund, in reasonable
quantities upon your request. You agree to deliver a copy of the current and
relevant Prospectus in accordance with the provisions of the Securities Act of
1933 to each purchaser of Shares. We shall file Fund sales literature and
promotional material with the NASD as required. You may not publish or use any
sales literature or promotional materials with respect to the Shares, the Funds
or any Fund without our prior review and written approval.
NOTICES AND COMMUNICATIONS:
- ---------------------------
14
<PAGE>
All communications from you (other than purchase and sale orders) should be
addressed to us at 211 Congress Street, Boston, Massachusetts 02110, Attention:
Compliance Officer. Any notice from us to you shall be deemed to have been duly
given if mailed or telegraphed to you at the address set forth below. Each of
us may change the address to which notices shall be sent by notice to the other
in accordance with the terms hereof.
TERMINATION:
- ------------
This Agreement may be terminated by either party at any time by written
notice to that effect and will terminate without notice upon the appointment of
a trustee for you under the Securities Investor Protection Act, or any other act
of insolvency by you. Notwithstanding the termination of this Agreement, you
shall remain liable for any amounts otherwise owing to us or the Funds and for
your portion of any transfer tax or other liability which may be asserted or
assessed against the Fund, or us.
AMENDMENT:
- ----------
This Agreement may be amended or revised to modify, suspend or terminate
payments hereunder as provided in the section above entitled "DISTRIBUTION
AND/OR SERVICE FEES" or to amend Appendix A as provided in said section. This
Agreement may be otherwise amended or revised at any time by us upon notice to
you and you will be deemed to have accepted any such other amendment or revision
upon placing any subsequent order for Shares.
GENERAL:
- --------
Your acceptance hereof will constitute an obligation on your part to
observe all the terms and conditions hereof. In the event that you breach any
of the terms and conditions of this Agreement, you will indemnify us, the Funds,
and our affiliates for any damages, losses, costs and expenses (including
reasonable attorneys' fees and expenses) arising out of or relating to such
breach. In the event that we breach any of the terms and conditions of this
Agreement, we will indemnify you and your affiliates for any damages, losses,
costs and expenses (including reasonable attorneys' fees and expenses) arising
out of or relating to such breach. Nothing contained herein shall constitute
you, us and any dealers an association or partnership. All references in this
Agreement to the "Prospectus" refer to the then current and relevant version of
the Prospectus of the particular Fund or Funds concerned and include the
Statement of Additional Information incorporated by reference therein and any
stickers or supplements thereto.
This Agreement is to be construed in accordance with the laws of The
Commonwealth of Massachusetts.
Please confirm this Agreement by dating and executing, by your duly
authorized representative, one copy of this Agreement below and return it to us.
Keep the enclosed duplicate copy for your records.
15
<PAGE>
UAM FUND DISTRIBUTORS, INC.
BY:_____________________________________
(Name of Officer and Title)
16
<PAGE>
SELECTED DEALER AGREEMENT ACCEPTANCE
- ------------------------------------
UAM FUND DISTRIBUTORS, INC.
The undersigned hereby confirms its acceptance of, and agreement to the
terms of, the foregoing Selected Dealer Agreement and acknowledges that any
purchase of Fund Shares made during the effectiveness of this Agreement is
subject to all the applicable terms and conditions set forth in this Agreement,
and agrees to pay for the shares at the price and upon the terms and conditions
stated in the Agreement. The undersigned hereby acknowledges receipt of
Prospectuses relating to the Fund Shares and confirms that, in executing this
Selected Dealer Agreement, it has relied on such Prospectuses and not on any
other statement whatsoever, written or oral.
INVESTMENT DEALER PLEASE SIGN HERE AND COMPLETE BELOW
________________________________________
(Full Corporate Name of Broker-Dealer)
By:_____________________________________
(Name of Officer and Title)
________________________________________
(Broker-Dealer's Tax Identification No,)
________________________________________
(Notice Address -- Please include name
of compliance contact)
Date:___________________________________
APPENDIX A
SCHEDULE OF FEES
12B-1 FEES
A separate fee for each Fund will be determined quarterly based on the
annual rates set forth below.
<TABLE>
<CAPTION>
DISTRIBUTION SERVICE
NAME OF FUND COMPONENT COMPONENT
- ------------ ------------ ---------
<S> <C> <C>
BHM&S Total Return Bond Portfolio (IS) 0.00% 0.25%
DSI Disciplined Value Portfolio (IS) 0.00% 0.25%
FMA Small Company Portfolio (IS) 0.15% 0.25%
FPA Crescent Portfolio (IS) 0.00% 0.25%
</TABLE>
17
<PAGE>
<TABLE>
<S> <C> <C>
MJI International Equity Portfolio (IS) 0.00% 0.25%
NWQ Balanced Portfolio (IS) 0.15% 0.25%
NWQ Value Equity Portfolio (IS) 0.15% 0.25%
Sirach Equity Portfolio (IS) 0.00% 0.25%
Sirach Growth Portfolio (IS) 0.00% 0.25%
Sirach Special Equity Portfolio (IS) 0.00% 0.25%
Sirach Strategic Balanced Portfolio (IS) 0.00% 0.25%
Sterling Partners' Balanced Portfolio (IS) 0.00% 0.25%
Sterling Partners' Equity Portfolio (IS) 0.00% 0.25%
TJ Core Equity Portfolio (IS) 0.00% 0.25%
</TABLE>
18
<PAGE>
SUPPLEMENTAL FEES
(FOR CERTAIN DEFINED CONTRIBUTION PLANS ONLY)
Supplemental fees for each broker-dealer will be determined quarterly as of
the end of each calendar quarter. Each quarterly fee shall consist of
CONVERSION COMPONENTS, if any, and NEW CONTRIBUTION COMPONENTS, if any.
There shall be a CONVERSION COMPONENT with respect to each new shareholder
account established through the purchase of Shares of the Funds subject to the
further terms and conditions stated in this paragraph. The aggregate purchase
price of Shares of the Funds initially acquired by the account must have been at
least $1,000,000 and the account must have been in existence for at least one
full calendar quarter. The portion of the CONVERSION COMPONENT attributable to
the Shares of each Fund initially acquired by such account shall be calculated
by applying the quarterly rate of the CONVERSION COMPONENT for that Fund, as
specified below, to the aggregate purchase price of the Shares of that Fund
initially acquired. The amount so calculated shall be included in the fee with
respect to such account for each of the four (4) full calendar quarters
following the establishment of the account; provided, however, that such
CONVERSION COMPONENT shall not be payable with respect to, or included in the
fee for, any such quarter if, as of the last business day of such quarter, the
number of Shares of the Funds (adjusted, if necessary, to give effect to
exchanges) held in the account has been reduced to less than ninety (90) percent
of the number of Shares initially acquired by such account, nor shall a
CONVERSION COMPONENT be payable for any quarter subsequent thereto.
There shall be a NEW CONTRIBUTION COMPONENT for each shareholder account
which existed at the beginning of a calendar quarter subject to the further
terms and conditions stated in this paragraph. The account must have made a
QUALIFYING PURCHASE of Shares of a Fund or Funds during the quarter concerned.
A QUALIFYING PURCHASE means an aggregate investment of at least $100,000 in the
Shares of the Funds. The portion of the NEW CONTRIBUTION COMPONENT attributable
to the Shares of each Fund acquired by such account as part of a QUALIFYING
PURCHASE shall be calculated by applying the single payment rate of the NEW
CONTRIBUTION COMPONENT for that Fund, as specified below, to the portion of the
QUALIFYING PURCHASE made in Shares of that Fund and aggregating the amounts for
all such Funds the Shares of which were included in such QUALIFYING PURCHASE.
The aggregate amount of the NEW CONTRIBUTION COMPONENT so determined shall be
included in the supplemental fees for the single quarter concerned.
<TABLE>
<CAPTION>
NEW
CONVERSION CONTRIBUTION
NAME OF FUND COMPONENT COMPONENT
- ------------ ---------- ------------
<S> <C> <C>
BHM&S Total Return Bond Portfolio (IS) * 0.25%
DSI Disciplined Value Portfolio (IS) * 0.25%
FMA Small Company Portfolio (IS) * 0.25%
MJI International Equity Portfolio (IS) * 0.25%
</TABLE>
19
<PAGE>
<TABLE>
<S> <C> <C>
NWQ Small Cap Value Portfolio (IS) * 0.25%
NWQ Special Equity Portfolio (IS) * 0.25%
NWQ Balanced Portfolio (IS) * 0.25%
NWQ Value Equity Portfolio (IS) * 0.25%
Sirach Equity Portfolio (IS) * 0.25%
Sirach Growth Portfolio (IS) * 0.25%
Sirach Special Equity Portfolio (IS) * 0.25%
Sirach Strategic Balanced Portfolio (IS) * 0.25%
Sterling Partners' Balanced Portfolio (IS) * 0.25%
Sterling Partners' Equity Portfolio (IS) * 0.25%
Sterling Partners' Small Cap Value Portfolio (IS) * 0.25%
TJ Core Equity Portfolio (IS) * 0.25%
</TABLE>
_____________________
* At the quarterly rate of 0.125% on the first $3,000,000 of initial assets and
0.0625% on the excess of such assets over $3,000,000.
20
<PAGE>
EXHIBIT M.3.
UAM FUNDS TRUST I
SHAREHOLDER SERVICES PLAN
-------------------------
1. Services. Under this Shareholder Services Plan (the "Plan"),
--------
_______________ (the "Shareholder Servicing Agent"), shall provide personal
service and/or services for the maintenance of shareholder accounts for the
shareholders of UAM Funds Trust (the "Fund") including:
(a) acting as the sole shareholder of record and nominee for
beneficial owners;
(b) maintaining account records for such beneficial owners of the
Fund's shares;
(c) opening and closing accounts;
(d) answering questions and handling correspondence from shareholders
about their accounts;
(e) processing shareholder orders to purchase, redeem and exchange
shares;
(f) handling the transmission of funds representing the purchase
price or redemption proceeds;
(g) issuing confirmation for transactions in the Fund's shares by
shareholders;
(h) distributing current copies of prospectuses, statements of
additional information and shareholder reports;
(i) assisting customers in completing application forms, selecting
dividend and other account options and opening custody accounts with the
Shareholder Servicing Agent;
(j) providing account maintenance and accounting support for all
transactions.
(k) performing such additional shareholder services as may be agreed
upon by the Fund and the Shareholder Servicing Agent, provided that any
such additional shareholder service must constitute a permissible non-
banking activity in accordance with the then current regulations of, and
interpretations thereof by, the Board of Governors of the Federal Reserve
System.
2. Shareholder Servicing Fee. In consideration for the foregoing
-------------------------
services, the Fund shall reimburse the Shareholder Servicing Agent for the
actual expenses incurred by the Shareholder Servicing Agent in providing the
foregoing services up to a maximum annual rate equal to 0.25% of the average
daily net assets of the Fund serviced by the Shareholder Servicing Agent,
accrued daily and payable monthly.
3. Reimbursement. All shareholder services expenses shall be submitted
-------------
for reimbursement promptly and must be submitted for reimbursement in the same
fiscal year of the Fund in which such expenses were incurred or, in the case of
expenses incurred close to the end of the Fund's fiscal year, in the next fiscal
quarter of the Fund after such expenses have been incurred.
4. Term. This Plan, which was approved initially by the Board of
----
Trustees of the Fund on June 18, 1998, shall continue in effect indefinitely
thereafter so long as its continuance, together with the continuance of any and
all agreements now or in the future related to the Plan, are approved at least
annually by a majority of the Board of Trustees of the Fund including a majority
of the Trustees who are not "interested persons," as defined in the 1940 Act, of
the Fund and who have no direct or indirect financial interest in the operation
of the Plan, or any agreements related to the Plan, cast in person at a meeting
called for the purpose of voting on the Plan and any related agreements.
5. Quarterly Report. The Trustees of the Fund shall review on a
----------------
quarterly basis a written report of the amount of monies reimbursed or
reimbursable by the Fund pursuant to the Plan and any related agreements and the
purposes for which such reimbursements and the related expenditures were made.
Such quarterly report shall be
1
<PAGE>
prepared by such persons as are authorized to direct the distribution of monies
reimbursed or reimbursable by the Fund pursuant to the Plan and any related
agreements.
6. Termination. This Plan may be terminated at any time by vote of the
-----------
majority of the Trustees of the Fund who are not "interested persons," as
defined in the 1940 Act, of the Fund and who have no direct or indirect
financial interest in the operation of the Plan or in any agreements related to
the Plan or, at the discretion of the Board of Trustees of the Fund, by vote of
a majority of the outstanding voting securities of the Fund.
7. Trustees' Review. The Trustees of the Fund have a duty to request and
----------------
evaluate, and the Shareholder Servicing Agent agrees to provide upon request by
the Fund, such information as may be reasonably necessary to make an informed
determination of whether the Plan should be implemented or continued. In
fulfilling their duties under this Section 7, the Trustees should consider and
give appropriate weight to all factors pertinent to the continued use of the
Fund's assets for the Plan. Minutes describing the factors considered and the
basis for the Trustees' decision to use the Fund's assets for the Plan must be
made and preserved.
8. Amendments. The Plan may not be amended in any material respect
----------
except with the approval of a majority of the Board of Trustees of the Fund
including a majority of the Trustees who are not "interested Persons," as
defined in the 1940 Act, of the Fund cast in person at a meeting called for the
purpose of voting on such amendment to the Plan.
2
<PAGE>
EXHIBIT M.4.
OMNIBUS ACCOUNT SERVICES AGREEMENT
UAM FUNDS, INC.
UAM FUNDS TRUST
AGREEMENT entered into as of _________________, by and between UAM Funds, Inc.
and UAM Funds Trust (collectively, the "Funds"), various investment advisers to
such Funds (the "Adviser"), and _______________________ ("Service Provider").
As used in this Agreement, the following terms shall have the following
meanings, unless a different meaning is clearly required by the context:
Client-shareholders shall mean those clients of Service Provider who maintain an
- -------------------
interest in an omnibus account with the Funds registered in the name of
"____________" and who receive services from Service Provider under this
Agreement.
Funds - See attached list.
- -----
In consideration of the mutual covenants herein contained, the parties agree as
follows:
1. Service Provider agrees to perform certain services for the Client-
shareholders as more particularly set forth below. Service Provider
represents and warrants that it has, and will continue at all times to
have, the necessary facilities, equipment and personnel to perform its
services hereunder in a businesslike and competent manner; systems to
comply with any applicable laws, rules and regulations related to the
services to be provided under this Agreement, including the maintenance and
preservation of all records and registrations required by any applicable
laws, rules and regulations.
2. Service Provider represents and warrants that all Client-shareholders are
aware that they are transacting business with Service Provider and not the
Funds, and that they will look only to Service Provider and not the Funds
for resolution of problems or discrepancies in their accounts. Service
Provider represents and warrants that it is registered or not required to
be registered as either a broker-dealer pursuant to Section 15 of the
Securities Exchange Act of 1934 (the "Exchange Act") or a transfer agent
pursuant to Section 17A of the Exchange Act. Service Provider further
represents and warrants that neither it nor any of its affiliates is, or
during the term of this Agreement will become, a "fiduciary" as that term
is defined in Section 4975 of the Internal Revenue Code of 1986, as
amended, or in Section 3(21)(A) of the Employee Retirement Income Security
Act of 1974, as amended, with respect to any investment in the Funds which
may be subject to such Sections, or if we are a fiduciary, our receipt of
compensation pursuant to this Agreement will not violate federal law.
3. Service Provider agrees that it will establish with the Funds one or more
omnibus accounts registered in Service Provider's name for Client-
shareholders in the Funds, and will perform various services for Client-
shareholders in those accounts, including without limitation: establishing
and maintaining records of Client-shareholders' accounts; processing
purchase and redemption transactions; confirming Client-shareholder
transactions; delivering prospectuses to new shareholders upon confirmation
of purchase order; delivery of shareholder reports and proxies to
shareholders; answering routine client inquiries regarding the Funds;
assisting clients in changing dividend options, account
-1-
<PAGE>
designations and addresses; withholding taxes on non-resident alien
accounts; disbursing income dividends and capital gains distributions;
reinvesting dividends and distributions; preparing and delivering to
Client-shareholders and state and federal authorities, including the United
States Internal Revenue Service, such information respecting dividends and
distributions paid by the Funds as may be required by law, rule or
regulation; withholding on dividends and distributions as may be required
by state or federal authorities from time to time; and such other services
as the Funds may reasonably request. Service Provider will transmit to each
Fund each business day by 4:00 p.m. EST purchase or redemption orders
reflecting purchase, redemption and exchange orders received by it that
business day for Client-shareholders.
4. Service Provider may maintain all historical Client-shareholder records
consistent with requirements of all applicable laws, rules and regulations.
Upon the request of the Funds, Service Provider shall provide copies of
written communications regarding the Funds to or from such Client-
shareholders, and other materials. Service Provider shall make available
(if requested) to the Funds, records or communications necessary to
determine the number of Client-shareholders in each Service Provider's
omnibus account, states of residence for each shareholder, and the number
of shares held by each. If, at any time, the Funds determine that Service
Provider's practices, procedures or controls are inadequate, written notice
of such inadequacy shall be given to Service Provider, and Service Provider
shall have 15 days plus any additional time which the Funds may provide to
correct its practices, procedures or controls. In the event such practices,
procedures or controls are not adequately corrected by Service Provider,
the Funds shall have the right to immediately terminate this Agreement.
Nothing in this Agreement shall impose upon the Funds the obligation to
review Service Provider's practices, procedures and controls.
5. The official records of transactions of Service Provider's omnibus account
and the number of shares in such omnibus accounts shall be as determined by
the Funds. Service Provider shall be solely responsible for any
discrepancies between its omnibus accounts and the Client-shareholder
accounts and for the maintenance of all records regarding the Client-
shareholders, the Client-shareholders' transactions and the Client-
shareholders' interests in the omnibus accounts.
6. Service Provider is solely responsible for the reconciliation of customer
accounts with its omnibus account at the Funds. If any such reconciliation
indicates any unexplained reconciling item or items, the Funds agree to
assist Service Provider in resolving any discrepancies.
7. The Funds will have the sole authority and responsibility under this
Agreement for countersigning securities of the Funds, monitoring the
issuance of securities of the Funds with a view to preventing unauthorized
issuance, registering the transfer of securities of the Funds, exchanging
or converting securities of the Funds or transferring record ownership of
securities of the Funds by bookkeeping entry without physical issuance of
securities certificates of the Funds. While Service Provider will provide
the services to its Client-shareholders as described in this Agreement,
Service Provider will not engage in countersigning securities of the Funds,
monitoring the issuance of securities of the Funds with a view to
preventing unauthorized issuance, registering the transfer of securities of
the Funds, exchanging or converting securities of the Funds, or
transferring record ownership of securities of the Funds by bookkeeping
entry without physical issuance of securities certificates of the Funds.
-2-
<PAGE>
8. The Funds represent and warrant that they will not use any information
relating to Client-shareholders received pursuant to this Agreement to
solicit or otherwise attempt to sell products to Client-shareholders.
9. For the services and facilities described in this Agreement, the Funds and
Adviser(s) will pay a fee to Service Provider after the end of each month
at the annual rate applicable to the average aggregate daily net asset
value of shares of the Funds in the accounts for which Service Provider
provides services. The initial terms, conditions and amounts of such
payments are set forth in Schedule A attached hereto.
In computing Service Provider's fee, one-twelfth of the applicable fee rate
set forth in Schedule A shall be applied to the average aggregate daily net
asset value of shares of the applicable Funds in accounts for which Service
Provider provides services for the month in question. Each month's fee
shall be determined independently of every other month's fee. For the month
in which this Agreement becomes effective or terminates, there shall be an
appropriate proration on the basis of the number of days that the Agreement
is in effect during the month.
Except as otherwise agreed in writing with the Funds with respect to
specific expenditures by Service Provider, Service Provider shall be solely
responsible for all costs and expenses of providing services under this
Agreement.
The parties to this Agreement recognize and agree that all payments made
under this Agreement represent compensation for the administrative services
contained herein only and do not constitute payment in any manner for
investment advisory services or for costs of distribution of the Fund's
shares.
10. With regard to all the services provided to its Client-shareholders by
Service Provider, Service Provider is an independent contractor, is solely
responsible for its actions or inactions, and is not and does not have
authority to act as agent of the Funds. Service Provider is solely
responsible to its Client-shareholders and agrees that at all times,
including after termination of this Agreement, it will be responsible for
all complaints and inquiries from its Client-shareholders relating to
Service Provider's actions or inactions under this Agreement or relating to
the Client-shareholders' accounts during the period in which this Agreement
was in effect.
11. The Funds will be responsible for any loss, claim, demand or liability
arising from a material error or omission contained in the Funds'
prospectuses provided that the error or omission was not a result of
information provided by Service Provider. Service Provider shall indemnify
and hold each officer, employee and agent of each Fund harmless from and
against any and all losses arising out of any action taken or omitted to be
taken by Service Provider pursuant to this Agreement and resulting from
Service Provider's breach of this Agreement, willful misconduct or
negligence. This paragraph shall survive the termination of the Agreement.
12. Service Provider shall provide such security as is necessary to prevent
unauthorized use of any on-line computer facilities (if applicable).
13. Service Provider acknowledges that the Funds may enter into similar
agreements with others without the consent of Service Provider.
-3-
<PAGE>
14. If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder shall not be affected
thereby.
15. This Agreement supersedes all prior services agreements between the parties
relating to the Funds.
16. This Agreement shall become effective as of the date it is accepted by
Service Provider, and will continue in effect until terminated in writing
upon sixty (60) days prior notice by either party to the other; provided,
that Service Provider shall be entitled to receive all fees it has earned
up to and including the effective date of the termination.
17. This Agreement shall be governed by, and construed in accordance with, the
laws of The Commonwealth of Massachusetts.
18. Whenever notice is required under this Agreement, it shall be given in
writing by registered mail to the Funds c/o UAM Fund Services, Inc., 211
Congress Street, Boston, MA 02110; and to Service Provider at ___________.
19. The duties and obligations of the parties herein may not be assigned by a
party without the prior written consent of the other party.
20. This Agreement may be executed in one or more counterparts, each of which
shall be an original and all of which together shall be deemed one and the
same document.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
their respective corporate seals to be affixed as of the date first above
written by their respective officers hereunto duly authorized.
ATTEST: UAM FUNDS, INC.
UAM FUNDS TRUST
By:____________________________ By:_____________________________
Name:__________________________ Name:___________________________
Date:__________________________ Date:___________________________
ATTEST: ___________________[ADVISER]
By:____________________________ By:______________________________
Name:__________________________ Name:____________________________
Date:__________________________ Date:____________________________
ATTEST: ___________________[SERVICE PROVIDER]
By:____________________________ By:______________________________
Name:__________________________ Name:____________________________
Date:__________________________ Date:____________________________
-4-
<PAGE>
OMNIBUS ACCOUNT SERVICES AGREEMENT
LIST OF PARTICIPATING FUNDS:
- ---------------------------
-5-
<PAGE>
OMNIBUS ACCOUNT SERVICES AGREEMENT
SCHEDULE A
Fee payable to Service Provider is based upon the average aggregate daily net
asset value of shares of the Funds included in this Agreement and shall be in
the following amount: $__________.
-6-
<PAGE>
OMNIBUS ACCOUNT SERVICES AGREEMENT
UAM FUNDS, INC.
UAM FUNDS TRUST
AGREEMENT entered into as of _________________, by and between UAM Funds, Inc.
and UAM Funds Trust (collectively, the "Funds") and _______________________
("Service Provider").
As used in this Agreement, the following terms shall have the following
meanings, unless a different meaning is clearly required by the context:
Client-shareholders shall mean those clients of Service Provider who maintain an
- -------------------
interest in an omnibus account with the Funds registered in the name of
"____________" and who receive services from Service Provider under this
Agreement.
Funds - See attached list.
- -----
In consideration of the mutual covenants herein contained, the parties agree as
follows:
1. Service Provider agrees to perform certain services for the Client-
shareholders as more particularly set forth below. Service Provider
represents and warrants that it has, and will continue at all times to
have, the necessary facilities, equipment and personnel to perform its
services hereunder in a businesslike and competent manner; systems to
comply with any applicable laws, rules and regulations related to the
services to be provided under this Agreement, including the maintenance and
preservation of all records and registrations required by any applicable
laws, rules and regulations.
2. Service Provider represents and warrants that all Client-shareholders are
aware that they are transacting business with Service Provider and not the
Funds, and that they will look only to Service Provider and not the Funds
for resolution of problems or discrepancies in their accounts. Service
Provider represents and warrants that it is registered or not required to
be registered as either a broker-dealer pursuant to Section 15 of the
Securities Exchange Act of 1934 (the "Exchange Act") or a transfer agent
pursuant to Section 17A of the Exchange Act. Service Provider further
represents and warrants that neither it nor any of its affiliates is, or
during the term of this Agreement will become, a "fiduciary" as that term
is defined in Section 4975 of the Internal Revenue Code of 1986, as
amended, or in Section 3(21)(A) of the Employee Retirement Income Security
Act of 1974, as amended, with respect to any investment in the Funds which
may be subject to such Sections.
3. Service Provider agrees that it will establish with the Funds one or more
omnibus accounts registered in Service Provider's name for Client-
shareholders in the Funds, and will perform various services for Client-
shareholders in those accounts, including without limitation: establishing
and maintaining records of Client-shareholders' accounts; processing
purchase and redemption transactions; confirming Client-shareholder
transactions; delivering prospectuses to new shareholders upon confirmation
of purchase order; delivery of shareholder reports and proxies to
shareholders; answering routine client inquiries regarding the Funds;
assisting clients in changing dividend options, account designations and
addresses; withholding taxes on non-resident alien accounts; disbursing
income dividends and capital gains distributions; reinvesting dividends and
distributions; preparing and delivering to Client-shareholders and state
and federal authorities, including the United States Internal
-7-
<PAGE>
Revenue Service, such information respecting dividends and distributions
paid by the Funds as may be required by law, rule or regulation;
withholding on dividends and distributions as may be required by state or
federal authorities from time to time; and such other services as the Funds
may reasonably request. Service Provider will transmit to each Fund each
business day by 4:00 p.m. EST purchase or redemption orders reflecting
purchase, redemption and exchange orders received by it that business day
for Client-shareholders.
4. Service Provider may maintain all historical Client-shareholder records
consistent with requirements of all applicable laws, rules and regulations.
Upon the request of the Funds, Service Provider shall provide copies of
written communications regarding the Funds to or from such Client-
shareholders, and other materials. Service Provider shall make available
(if requested) to the Funds, records or communications necessary to
determine the number of Client-shareholders in each Service Provider's
omnibus account, states of residence for each shareholder, and the number
of shares held by each. If, at any time, the Funds determine that Service
Provider's practices, procedures or controls are inadequate, written notice
of such inadequacy shall be given to Service Provider, and Service Provider
shall have 15 days plus any additional time which the Funds may provide to
correct its practices, procedures or controls. In the event such practices,
procedures or controls are not adequately corrected by Service Provider,
the Funds shall have the right to immediately terminate this Agreement.
Nothing in this Agreement shall impose upon the Funds the obligation to
review Service Provider's practices, procedures and controls.
5. The official records of transactions of Service Provider's omnibus account
and the number of shares in such omnibus accounts shall be as determined by
the Funds. Service Provider shall be solely responsible for any
discrepancies between its omnibus accounts and the Client-shareholder
accounts and for the maintenance of all records regarding the Client-
shareholders, the Client-shareholders' transactions and the Client-
shareholders' interests in the omnibus accounts.
6. Service Provider is solely responsible for the reconciliation of customer
accounts with its omnibus account at the Funds. If any such reconciliation
indicates any unexplained reconciling item or items, the Funds agree to
assist Service Provider in resolving any discrepancies.
7. The Funds will have the sole authority and responsibility under this
Agreement for countersigning securities of the Funds, monitoring the
issuance of securities of the Funds with a view to preventing unauthorized
issuance, registering the transfer of securities of the Funds, exchanging
or converting securities of the Funds or transferring record ownership of
securities of the Funds by bookkeeping entry without physical issuance of
securities certificates of the Funds. While Service Provider will provide
the services to its Client-shareholders as described in this Agreement,
Service Provider will not engage in countersigning securities of the Funds,
monitoring the issuance of securities of the Funds with a view to
preventing unauthorized issuance, registering the transfer of securities of
the Funds, exchanging or converting securities of the Funds, or
transferring record ownership of securities of the Funds by bookkeeping
entry without physical issuance of securities certificates of the Funds.
8. The Funds represent and warrant that they will not use any information
relating to Client-shareholders received pursuant to this Agreement to
solicit or otherwise attempt to sell products to Client-shareholders.
-8-
<PAGE>
9. For the services and facilities described in this Agreement, the Funds will
pay a fee to Service Provider after the end of each month at the annual
rate applicable to the average aggregate daily net asset value of shares of
the Funds in the accounts for which Service Provider provides services. The
initial terms, conditions and amounts of such payments are set forth in
Schedule A attached hereto.
In computing Service Provider's fee, one-twelfth of the applicable fee rate
set forth in Schedule A shall be applied to the average aggregate daily net
asset value of shares of the applicable Funds in accounts for which Service
Provider provides services for the month in question. Each month's fee
shall be determined independently of every other month's fee. For the month
in which this Agreement becomes effective or terminates, there shall be an
appropriate proration on the basis of the number of days that the Agreement
is in effect during the month.
Except as otherwise agreed in writing with the Funds with respect to
specific expenditures by Service Provider, Service Provider shall be solely
responsible for all costs and expenses of providing services under this
Agreement.
The parties to this Agreement recognize and agree that all payments made
under this Agreement represent compensation for the administrative services
contained herein only and do not constitute payment in any manner for
investment advisory services or for costs of distribution of the Fund's
shares.
10. With regard to all the services provided to its Client-shareholders by
Service Provider, Service Provider is an independent contractor, is solely
responsible for its actions or inactions, and is not and does not have
authority to act as agent of the Funds. Service Provider is solely
responsible to its Client-shareholders and agrees that at all times,
including after termination of this Agreement, it will be responsible for
all complaints and inquiries from its Client-shareholders relating to
Service Provider's actions or inactions under this Agreement or relating to
the Client-shareholders' accounts during the period in which this Agreement
was in effect.
11. The Funds will be responsible for any loss, claim, demand or liability
arising from a material error or omission contained in the Funds'
prospectuses provided that the error or omission was not a result of
information provided by Service Provider. Service Provider shall indemnify
and hold each officer, employee and agent of each Fund harmless from and
against any and all losses arising out of any action taken or omitted to be
taken by Service Provider pursuant to this Agreement and resulting from
Service Provider's breach of this Agreement, willful misconduct or
negligence. This paragraph shall survive the termination of the Agreement.
12. Service Provider shall provide such security as is necessary to prevent
unauthorized use of any on-line computer facilities (if applicable).
13. Service Provider acknowledges that the Funds may enter into similar
agreements with others without the consent of Service Provider.
14. If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder shall not be affected
thereby.
15. This Agreement supersedes all prior services agreements between the parties
relating to the Funds.
-9-
<PAGE>
16. This Agreement shall become effective as of the date it is accepted by
Service Provider, and will continue in effect until terminated in writing
upon sixty (60) days prior notice by either party to the other; provided,
that Service Provider shall be entitled to receive all fees it has earned
up to and including the effective date of the termination.
17. This Agreement shall be governed by, and construed in accordance with, the
laws of The Commonwealth of Massachusetts.
18. Whenever notice is required under this Agreement, it shall be given in
writing by registered mail to the Funds c/o UAM Fund Services, Inc., 211
Congress Street, Boston, MA 02110; and to Service Provider at ___________.
19. The duties and obligations of the parties herein may not be assigned by a
party without the prior written consent of the other party.
20. This Agreement may be executed in one or more counterparts, each of which
shall be an original and all of which together shall be deemed one and the
same document.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
their respective corporate seals to be affixed as of the date first above
written by their respective officers hereunto duly authorized.
ATTEST: UAM FUNDS, INC.
UAM FUNDS TRUST
By:____________________________ By:_____________________________
Name:__________________________ Name:___________________________
Date:__________________________ Date:___________________________
ATTEST: ___________________[SERVICE PROVIDER]
By:____________________________ By:______________________________
Name:__________________________ Name:____________________________
Date:__________________________ Date:____________________________
-10-
<PAGE>
OMNIBUS ACCOUNT SERVICES AGREEMENT
LIST OF PARTICIPATING FUNDS:
- ---------------------------
-11-
<PAGE>
OMNIBUS ACCOUNT SERVICES AGREEMENT
SCHEDULE A
Fee payable to Service Provider is based upon the average aggregate daily net
asset value of shares of the Funds included in this Agreement and shall be in
the following amount: $__________.
-12-
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 602
[NAME] BHM & S TOTAL RETURN BOND PORTFOLIO, INSTITUTIONAL SERVICE CLASS
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 34,985,825
[INVESTMENTS-AT-VALUE] 35,252,010
[RECEIVABLES] 523,214
[ASSETS-OTHER] 227
[OTHER-ITEMS-ASSETS] 128
[TOTAL-ASSETS] 35,775,579
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 117,462
[TOTAL-LIABILITIES] 117,462
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 34,625,865
[SHARES-COMMON-STOCK] 1,521,319
[SHARES-COMMON-PRIOR] 406,663
[ACCUMULATED-NII-CURRENT] 230,556
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 535,511
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 266,185
[NET-ASSETS] 35,658,117
[DIVIDEND-INCOME] 0
[INTEREST-INCOME] 1,948,958
[OTHER-INCOME] 0
[EXPENSES-NET] (240,459)
[NET-INVESTMENT-INCOME] 1,708,499
[REALIZED-GAINS-CURRENT] 719,181
[APPREC-INCREASE-CURRENT] 340,239
[NET-CHANGE-FROM-OPS] 2,767,919
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (671,335)
[DISTRIBUTIONS-OF-GAINS] (58,332)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 1,470,225
[NUMBER-OF-SHARES-REDEEMED] (426,221)
[SHARES-REINVESTED] 70,652
[NET-CHANGE-IN-ASSETS] 18,551,157
[ACCUMULATED-NII-PRIOR] 117,102
[ACCUMULATED-GAINS-PRIOR] (43,821)
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 107,452
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 392,973
[AVERAGE-NET-ASSETS] 30,611,394
[PER-SHARE-NAV-BEGIN] 9.95
[PER-SHARE-NII] 0.56
[PER-SHARE-GAIN-APPREC] 0.40
[PER-SHARE-DIVIDEND] (0.53)
[PER-SHARE-DISTRIBUTIONS] (0.04)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 10.34
[EXPENSE-RATIO] 0.94
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 601
[NAME] BHM & S TOTAL RETURN BOND PORTFOLIO, INSTITUTIONAL CLASS
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 34,985,825
[INVESTMENTS-AT-VALUE] 35,252,010
[RECEIVABLES] 523,214
[ASSETS-OTHER] 227
[OTHER-ITEMS-ASSETS] 128
[TOTAL-ASSETS] 35,775,579
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 117,462
[TOTAL-LIABILITIES] 117,462
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 34,625,865
[SHARES-COMMON-STOCK] 1,923,231
[SHARES-COMMON-PRIOR] 1,311,135
[ACCUMULATED-NII-CURRENT] 230,556
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 535,511
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 266,185
[NET-ASSETS] 35,658,117
[DIVIDEND-INCOME] 0
[INTEREST-INCOME] 1,948,958
[OTHER-INCOME] 0
[EXPENSES-NET] (240,459)
[NET-INVESTMENT-INCOME] 1,708,499
[REALIZED-GAINS-CURRENT] 719,181
[APPREC-INCREASE-CURRENT] 340,239
[NET-CHANGE-FROM-OPS] 2,767,919
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (928,980)
[DISTRIBUTIONS-OF-GAINS] (76,247)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 1,644,535
[NUMBER-OF-SHARES-REDEEMED] (1,130,795)
[SHARES-REINVESTED] 98,356
[NET-CHANGE-IN-ASSETS] 18,551,157
[ACCUMULATED-NII-PRIOR] 117,102
[ACCUMULATED-GAINS-PRIOR] (43,821)
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 107,452
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 392,973
[AVERAGE-NET-ASSETS] 30,611,394
[PER-SHARE-NAV-BEGIN] 9.96
[PER-SHARE-NII] 0.58
[PER-SHARE-GAIN-APPREC] 0.41
[PER-SHARE-DIVIDEND] (0.55)
[PER-SHARE-DISTRIBUTIONS] (0.04)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 10.36
[EXPENSE-RATIO] 0.68
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 3
[NAME] CHICAGO ASSET MANAGEMENT INTERMEDIATE BOND PORTFOLIO
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 12,902,050
[INVESTMENTS-AT-VALUE] 13,089,243
[RECEIVABLES] 187,332
[ASSETS-OTHER] 77
[OTHER-ITEMS-ASSETS] 8,359
[TOTAL-ASSETS] 13,285,011
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 23,694
[TOTAL-LIABILITIES] 23,694
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 12,969,351
[SHARES-COMMON-STOCK] 1,258,182
[SHARES-COMMON-PRIOR] 975,130
[ACCUMULATED-NII-CURRENT] 87,263
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 17,510
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 187,193
[NET-ASSETS] 13,261,317
[DIVIDEND-INCOME] 0
[INTEREST-INCOME] 706,247
[OTHER-INCOME] 0
[EXPENSES-NET] (87,715)
[NET-INVESTMENT-INCOME] 618,532
[REALIZED-GAINS-CURRENT] 19,841
[APPREC-INCREASE-CURRENT] 190,831
[NET-CHANGE-FROM-OPS] 829,204
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (596,183)
[DISTRIBUTIONS-OF-GAINS] (4,101)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 272,351
[NUMBER-OF-SHARES-REDEEMED] (46,828)
[SHARES-REINVESTED] 57,529
[NET-CHANGE-IN-ASSETS] 3,217,140
[ACCUMULATED-NII-PRIOR] 60,816
[ACCUMULATED-GAINS-PRIOR] 1,414
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 52,374
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 190,328
[AVERAGE-NET-ASSETS] 10,965,297
[PER-SHARE-NAV-BEGIN] 10.30
[PER-SHARE-NII] 0.57
[PER-SHARE-GAIN-APPREC] 0.24
[PER-SHARE-DIVIDEND] (0.57)
[PER-SHARE-DISTRIBUTIONS] 0
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 10.54
[EXPENSE-RATIO] 0.80
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 2
[NAME] CHICAGO ASSET MANAGEMENT VALUE/CONTRARIAN PORTFOLIO
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 19,772,188
[INVESTMENTS-AT-VALUE] 22,544,249
[RECEIVABLES] 146,713
[ASSETS-OTHER] 147
[OTHER-ITEMS-ASSETS] 7,533
[TOTAL-ASSETS] 22,698,642
[PAYABLE-FOR-SECURITIES] 100,284
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 46,586
[TOTAL-LIABILITIES] 146,870
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 18,387,505
[SHARES-COMMON-STOCK] 1,413,162
[SHARES-COMMON-PRIOR] 1,056,131
[ACCUMULATED-NII-CURRENT] 25,950
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 1,366,256
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 2,772,061
[NET-ASSETS] 22,551,772
[DIVIDEND-INCOME] 385,704
[INTEREST-INCOME] 21,032
[OTHER-INCOME] 0
[EXPENSES-NET] (183,113)
[NET-INVESTMENT-INCOME] 223,623
[REALIZED-GAINS-CURRENT] 2,464,320
[APPREC-INCREASE-CURRENT] 2,363,924
[NET-CHANGE-FROM-OPS] 5,051,867
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (223,623)
[DISTRIBUTIONS-OF-GAINS] (2,464,320)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 509,622
[NUMBER-OF-SHARES-REDEEMED] (250,654)
[SHARES-REINVESTED] 98,063
[NET-CHANGE-IN-ASSETS] 8,747,366
[ACCUMULATED-NII-PRIOR] 30,593
[ACCUMULATED-GAINS-PRIOR] 81,888
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 120,386
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 306,522
[AVERAGE-NET-ASSETS] 19,275,791
[PER-SHARE-NAV-BEGIN] 13.07
[PER-SHARE-NII] 0.17
[PER-SHARE-GAIN-APPREC] 3.84
[PER-SHARE-DIVIDEND] (1.12)
[PER-SHARE-DISTRIBUTIONS] 0
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 15.96
[EXPENSE-RATIO] 0.95
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 101
[NAME] MJI INTERNATIONAL EQUITY PORTFOLIO, INSTITUTIONAL CLASS
[MULTIPLIER] 1
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 33,806,872
[INVESTMENTS-AT-VALUE] 40,660,641
[RECEIVABLES] 193,073
[ASSETS-OTHER] 299
[OTHER-ITEMS-ASSETS] 181,848
[TOTAL-ASSETS] 41,035,861
[PAYABLE-FOR-SECURITIES] 1,391,451
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 97,561
[TOTAL-LIABILITIES] 1,489,012
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 32,223,942
[SHARES-COMMON-STOCK] 2,628,369
[SHARES-COMMON-PRIOR] 2,705,133
[ACCUMULATED-NII-CURRENT] 176,583
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 290,631
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 6,855,693
[NET-ASSETS] 39,546,849
[DIVIDEND-INCOME] 672,254
[INTEREST-INCOME] 119,169
[OTHER-INCOME] 0
[EXPENSES-NET] (582,590)
[NET-INVESTMENT-INCOME] 208,833
[REALIZED-GAINS-CURRENT] 1,765,346
[APPREC-INCREASE-CURRENT] 4,790,545
[NET-CHANGE-FROM-OPS] 6,764,724
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (108,747)
[DISTRIBUTIONS-OF-GAINS] (1,117,397)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 997,759
[NUMBER-OF-SHARES-REDEEMED] (1,155,750)
[SHARES-REINVESTED] 81,227
[NET-CHANGE-IN-ASSETS] 6,809,078
[ACCUMULATED-NII-PRIOR] 19,125
[ACCUMULATED-GAINS-PRIOR] (53,598)
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 284,464
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 610,929
[AVERAGE-NET-ASSETS] 37,835,437
[PER-SHARE-NAV-BEGIN] 10.65
[PER-SHARE-NII] 0.07
[PER-SHARE-GAIN-APPREC] 2.02
[PER-SHARE-DIVIDEND] (0.04)
[PER-SHARE-DISTRIBUTIONS] (0.41)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 12.29
[EXPENSE-RATIO] 1.50
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 102
[NAME] MJI INTERNATIONAL EQUITY PORTFOLIO, INSTITUTIONAL SERVICE CLASS
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 33,806,872
[INVESTMENTS-AT-VALUE] 40,660,641
[RECEIVABLES] 193,073
[ASSETS-OTHER] 299
[OTHER-ITEMS-ASSETS] 181,848
[TOTAL-ASSETS] 41,035,861
[PAYABLE-FOR-SECURITIES] 1,391,451
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 97,561
[TOTAL-LIABILITIES] 1,489,012
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 32,223,942
[SHARES-COMMON-STOCK] 591,675
[SHARES-COMMON-PRIOR] 368,199
[ACCUMULATED-NII-CURRENT] 176,583
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 290,631
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 6,855,693
[NET-ASSETS] 39,546,849
[DIVIDEND-INCOME] 672,254
[INTEREST-INCOME] 119,169
[OTHER-INCOME] 0
[EXPENSES-NET] (582,590)
[NET-INVESTMENT-INCOME] 208,833
[REALIZED-GAINS-CURRENT] 1,765,346
[APPREC-INCREASE-CURRENT] 4,790,545
[NET-CHANGE-FROM-OPS] 6,764,724
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (108,747)
[DISTRIBUTIONS-OF-GAINS] (1,117,397)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 351,711
[NUMBER-OF-SHARES-REDEEMED] (152,109)
[SHARES-REINVESTED] 23,874
[NET-CHANGE-IN-ASSETS] 6,809,078
[ACCUMULATED-NII-PRIOR] 19,125
[ACCUMULATED-GAINS-PRIOR] (53,598)
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 284,464
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 610,929
[AVERAGE-NET-ASSETS] 37,835,437
[PER-SHARE-NAV-BEGIN] 10.65
[PER-SHARE-NII] 0.04
[PER-SHARE-GAIN-APPREC] 2.02
[PER-SHARE-DIVIDEND] (0.04)
[PER-SHARE-DISTRIBUTIONS] (0.41)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 12.26
[EXPENSE-RATIO] 1.75
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 10
[NAME] HANSON EQUITY PORTFOLIO
[MULTIPLIER] 1
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] OCT-03-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 23,139,488
[INVESTMENTS-AT-VALUE] 25,817,931
[RECEIVABLES] 28,356
[ASSETS-OTHER] 0
[OTHER-ITEMS-ASSETS] 879
[TOTAL-ASSETS] 25,847,166
[PAYABLE-FOR-SECURITIES] 104,538
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 52,814
[TOTAL-LIABILITIES] 157,352
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 22,886,905
[SHARES-COMMON-STOCK] 2,257,986
[SHARES-COMMON-PRIOR] 0
[ACCUMULATED-NII-CURRENT] 0
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 124,466
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 2,678,443
[NET-ASSETS] 25,689,814
[DIVIDEND-INCOME] 110,927
[INTEREST-INCOME] 33,551
[OTHER-INCOME] 0
[EXPENSES-NET] (186,469)
[NET-INVESTMENT-INCOME] (41,991)
[REALIZED-GAINS-CURRENT] 166,457
[APPREC-INCREASE-CURRENT] 2,678,443
[NET-CHANGE-FROM-OPS] 2,802,909
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] 0
[DISTRIBUTIONS-OF-GAINS] 0
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 2,346,914
[NUMBER-OF-SHARES-REDEEMED] (88,928)
[SHARES-REINVESTED] 0
[NET-CHANGE-IN-ASSETS] 25,689,814
[ACCUMULATED-NII-PRIOR] 0
[ACCUMULATED-GAINS-PRIOR] 0
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 83,786
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 186,584
[AVERAGE-NET-ASSETS] 20,823,968
[PER-SHARE-NAV-BEGIN] 10.00
[PER-SHARE-NII] (0.02)
[PER-SHARE-GAIN-APPREC] 1.40
[PER-SHARE-DIVIDEND] 0.00
[PER-SHARE-DISTRIBUTIONS] 0.00
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 11.38
[EXPENSE-RATIO] 1.56
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 9
[NAME] JACOBS INTERNATIONAL OCTAGON PORTFOLIO
[MULTIPLIER] 1
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 96,770,629
[INVESTMENTS-AT-VALUE] 106,116,645
[RECEIVABLES] 9,541,842
[ASSETS-OTHER] 2,816
[OTHER-ITEMS-ASSETS] 10,093
[TOTAL-ASSETS] 115,671,396
[PAYABLE-FOR-SECURITIES] 2,462,340
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 175,991
[TOTAL-LIABILITIES] 2,638,331
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 101,419,475
[SHARES-COMMON-STOCK] 9,541,635
[SHARES-COMMON-PRIOR] 3,524,602
[ACCUMULATED-NII-CURRENT] 435,850
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 1,834,281
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 9,343,459
[NET-ASSETS] 113,033,065
[DIVIDEND-INCOME] 1,606,670
[INTEREST-INCOME] 382,281
[OTHER-INCOME] 0
[EXPENSES-NET] (1,088,001)
[NET-INVESTMENT-INCOME] 900,950
[REALIZED-GAINS-CURRENT] 2,888,359
[APPREC-INCREASE-CURRENT] 9,443,503
[NET-CHANGE-FROM-OPS] 13,232,812
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (493,305)
[DISTRIBUTIONS-OF-GAINS] (1,198,681)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 7,481,824
[NUMBER-OF-SHARES-REDEEMED] (1,613,998)
[SHARES-REINVESTED] 149,207
[NET-CHANGE-IN-ASSETS] 77,200,275
[ACCUMULATED-NII-PRIOR] 193,316
[ACCUMULATED-GAINS-PRIOR] (20,508)
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 730,085
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 1,092,216
[AVERAGE-NET-ASSETS] 73,104,821
[PER-SHARE-NAV-BEGIN] 10.17
[PER-SHARE-NII] 0.10
[PER-SHARE-GAIN-APPREC] 1.82
[PER-SHARE-DIVIDEND] (0.09)
[PER-SHARE-DISTRIBUTIONS] (0.15)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 11.85
[EXPENSE-RATIO] 1.49
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 5
[NAME] TJ CORE EQUITY PORTFOLIO
[MULTIPLIER] 1
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] APR-30-1998
[PERIOD-START] MAY-01-1997
[PERIOD-END] APR-30-1998
[INVESTMENTS-AT-COST] 9,365,370
[INVESTMENTS-AT-VALUE] 11,582,653
[RECEIVABLES] 112,005
[ASSETS-OTHER] 168
[OTHER-ITEMS-ASSETS] 939
[TOTAL-ASSETS] 11,695,765
[PAYABLE-FOR-SECURITIES] 219,156
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 128,566
[TOTAL-LIABILITIES] 347,772
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 8,750,770
[SHARES-COMMON-STOCK] 655,964
[SHARES-COMMON-PRIOR] 221,292
[ACCUMULATED-NII-CURRENT] 83
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 379,907
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 2,217,283
[NET-ASSETS] 11,348,043
[DIVIDEND-INCOME] 131,795
[INTEREST-INCOME] 35,270
[OTHER-INCOME] 0
[EXPENSES-NET] (105,056)
[NET-INVESTMENT-INCOME] 62,009
[REALIZED-GAINS-CURRENT] 512,167
[APPREC-INCREASE-CURRENT] 1,815,201
[NET-CHANGE-FROM-OPS] 2,389,377
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (64,393)
[DISTRIBUTIONS-OF-GAINS] (179,488)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 610,019
[NUMBER-OF-SHARES-REDEEMED] (191,077)
[SHARES-REINVESTED] 15,730
[NET-CHANGE-IN-ASSETS] 8,459,685
[ACCUMULATED-NII-PRIOR] 2,467
[ACCUMULATED-GAINS-PRIOR] 47,228
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 63,097
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 232,811
[AVERAGE-NET-ASSETS] 8,412,307
[PER-SHARE-NAV-BEGIN] 13.05
[PER-SHARE-NII] 0.10
[PER-SHARE-GAIN-APPREC] 4.55
[PER-SHARE-DIVIDEND] (0.11)
[PER-SHARE-DISTRIBUTIONS] (0.29)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 17.30
[EXPENSE-RATIO] 1.25
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 081
[NAME] FPA CRESCENT PORTFOLIO, INSTITUTIONAL CLASS
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] MAR-31-1998
[PERIOD-START] APR-01-1997
[PERIOD-END] MAR-31-1998
[INVESTMENTS-AT-COST] 239,634,432
[INVESTMENTS-AT-VALUE] 264,007,290
[RECEIVABLES] 3,993,582
[ASSETS-OTHER] 6,564,786
[OTHER-ITEMS-ASSETS] 1,138
[TOTAL-ASSETS] 274,566,796
[PAYABLE-FOR-SECURITIES] 3,274,001
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 4,559,905
[TOTAL-LIABILITIES] 7,833,906
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 236,750,850
[SHARES-COMMON-STOCK] 15,273,878
[SHARES-COMMON-PRIOR] 4,874,819
[ACCUMULATED-NII-CURRENT] 1,258,006
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 5,178,188
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 23,545,846
[NET-ASSETS] 266,732,890
[DIVIDEND-INCOME] 2,389,503
[INTEREST-INCOME] 5,206,357
[OTHER-INCOME] 0
[EXPENSES-NET] 2,232,285
[NET-INVESTMENT-INCOME] 5,363,575
[REALIZED-GAINS-CURRENT] 7,332,464
[APPREC-INCREASE-CURRENT] 19,022,777
[NET-CHANGE-FROM-OPS] 31,718,816
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (3,845,555)
[DISTRIBUTIONS-OF-GAINS] (2,382,178)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 12,585,249
[NUMBER-OF-SHARES-REDEEMED] (2,561,193)
[SHARES-REINVESTED] 375,003
[NET-CHANGE-IN-ASSETS] 201,082,576
[ACCUMULATED-NII-PRIOR] 339,182
[ACCUMULATED-GAINS-PRIOR] 403,521
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 1,489,678
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 2,237,290
[AVERAGE-NET-ASSETS] 148,794,099
[PER-SHARE-NAV-BEGIN] 13.46
[PER-SHARE-NII] 0.55
[PER-SHARE-GAIN-APPREC] 2.88
[PER-SHARE-DIVIDEND] (0.40)
[PER-SHARE-DISTRIBUTIONS] (0.26)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 16.23
[EXPENSE-RATIO] 1.48
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
[ARTICLE] 6
[CIK] 0000924727
[NAME] UAM FUNDS TRUST
[SERIES]
[NUMBER] 082
[NAME] FPA CRESCENT PORTFOLIO, INSTITUTIONAL SERVICE CLASS
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] MAR-31-1998
[PERIOD-START] APR-01-1997
[PERIOD-END] MAR-31-1998
[INVESTMENTS-AT-COST] 239,634,432
[INVESTMENTS-AT-VALUE] 264,007,290
[RECEIVABLES] 3,993,582
[ASSETS-OTHER] 6,564,786
[OTHER-ITEMS-ASSETS] 1,138
[TOTAL-ASSETS] 274,566,796
[PAYABLE-FOR-SECURITIES] 3,274,001
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 4,559,905
[TOTAL-LIABILITIES] 7,833,906
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 236,750,850
[SHARES-COMMON-STOCK] 1,170,063
[SHARES-COMMON-PRIOR] 2,349
[ACCUMULATED-NII-CURRENT] 1,258,006
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 5,178,188
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 23,545,846
[NET-ASSETS] 266,732,890
[DIVIDEND-INCOME] 2,389,503
[INTEREST-INCOME] 5,206,357
[OTHER-INCOME] 0
[EXPENSES-NET] 2,232,285
[NET-INVESTMENT-INCOME] 5,363,575
[REALIZED-GAINS-CURRENT] 7,332,464
[APPREC-INCREASE-CURRENT] 19,022,777
[NET-CHANGE-FROM-OPS] 31,718,816
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] (305,815)
[DISTRIBUTIONS-OF-GAINS] (179,223)
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 1,328,525
[NUMBER-OF-SHARES-REDEEMED] (193,182)
[SHARES-REINVESTED] 32,371
[NET-CHANGE-IN-ASSETS] 201,082,576
[ACCUMULATED-NII-PRIOR] 339,182
[ACCUMULATED-GAINS-PRIOR] 403,521
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 1,489,678
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 2,237,290
[AVERAGE-NET-ASSETS] 148,794,099
[PER-SHARE-NAV-BEGIN] 13.43
[PER-SHARE-NII] 0.53
[PER-SHARE-GAIN-APPREC] 2.84
[PER-SHARE-DIVIDEND] (0.39)
[PER-SHARE-DISTRIBUTIONS] (0.26)
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 16.15
[EXPENSE-RATIO] 1.73
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
<PAGE>
Exhibit O
UAM FUNDS TRUST
Amended and Restated
Multiple Class Plan
Pursuant to SEC Rule 18f-3
This Multiple Class Plan (the "Plan") has been adopted pursuant to Rule
18f-3 under the Investment Company Act of 1940 (the "Act") by UAM Funds Trust
(the "Fund") for its portfolios and classes of its portfolios. The Plan sets
forth the provisions relating to the establishment of multiple classes of shares
of the Fund as follows:
1. At the date of adoption of this Plan, the Fund has authorized the
issuance of three classes of shares which are subject to this Plan:
Institutional Class Shares, Institutional Service Class Shares and Advisor Class
Shares.
The Fund may offer an unlimited number of different classes of shares,
either in connection with a Distribution Plan adopted pursuant to Rule 12b-1
under the Investment Company Act of 1940, as amended (the "1940 Act"), (a
"Distribution Plan") and/or in connection with a shareholder services plan
("Shareholder Services Plan"), with more than one Plan, or without any of the
Plans.
2. Institutional Class Shares are no-load and do not impose a service fee
or asset-based sales charge.
3. Institutional Service Class Shares shall be subject to a service fee at
an annual rate of up to 0.25 of 1% of the average daily net asset value of
Institutional Service Class Shares and/or a distribution fee of up to .50 of 1%
of daily net assets per annum.
4. Advisor Class Shares shall be subject to a service fee at an annual
rate of up to 0.25 of 1% of the average daily net asset value of Advisor Class
Shares, a distribution fee of up to .50 of 1% of daily net assets per annum and
a maximum front-end sales charge of 4.75%.
5. The Distribution Plan adopted by the Fund pursuant to Rule 12b-1
associated with the Institutional Service Class Shares and the Advisor Class
Shares may be used to reimburse the Fund's underwriter or others for expenses
incurred in the promotion and distribution of the Institutional Service Class
Shares and the Advisor Class Shares.
The distribution-related services to be provided to the Fund and/or its
shareholders under the Distribution Plan may include, but are not limited to,
the following:
. advertising the availability of services and products;
<PAGE>
. designing material to send to customers and developing methods
of making such materials accessible to customers;
. providing information about the product needs of customers;
. providing facilities to solicit Fund sales and to answer
questions from prospective and existing investors about the
Fund;
. receiving and answering correspondence from prospective
investors, including requests for sales literature,
prospectuses and statements of additional information;
. displaying and making sales literature and prospectuses
available on the servicing organization's premises;
. acting as liaison between shareholders and the Fund, including
obtaining information from the Fund and providing performance
and other information about the Fund; and
. providing additional personal services and/or shareholder
account maintenance services.
The Shareholder Services Plan adopted by the Fund associated with the
Institutional Service Class Shares and the Advisor Class Shares may be used to
reimburse the Fund's underwriter or others for expenses incurred in providing
personal and account maintenance services to holders of Institutional Service
Class Shares and Advisor Class Shares.
The personal and account maintenance services to be provided to
shareholders under the Shareholder Services Plan of the Fund may include, but
are not limited to, the following:
. acting as the sole shareholder of record and nominee for all
beneficial owners;
. maintaining account records for each shareholder who beneficially
owns Shareholder Services Plan shares;
. opening and closing accounts; answering questions and handling
correspondence from shareholders about their accounts;
. processing shareholder orders to purchase, redeem and exchange
Shareholder Services Plan shares;
. posting interest;
-2-
<PAGE>
. handling the transmission of funds representing the purchase
price or redemption proceeds;
. issuing confirmations for transactions in Shareholder Services
Plan shares by shareholders;
. distributing current copies of prospectuses, statements of
additional information and shareholder reports;
. assisting Customers in completing application forms, selecting
dividend and other account options and opening custody accounts
with the service organizations;
. providing account maintenance and accounting support for all
transactions; and
. similar personal services and/or shareholder account maintenance
services as may be agreed to in the future.
The Distribution Plan shall operate in accordance with the Conduct
Rules of the National Association of Securities Dealers.
6. Expenses incurred by a class of shares of the Fund shall differ
from each other class of shares of the Fund only as to the differences in the
respective Distribution Plan and/or Shareholder Service Plan expenses for such
class of shares.
7. There shall be no conversion features associated with the
Institutional Class Shares, Institutional Service Class Shares and Advisor Class
Shares.
8. Shares of the Institutional Class Shares, Institutional Service
Class Shares and Advisor Class Shares may be exchanged only for shares of the
same class in another portfolio of the Fund, according to the terms and
conditions stated in each portfolio's prospectus, as it may be amended from time
to time, and to the extent permitted by the 1940 Act and the rules and
regulations adopted thereunder.
9. Each class of shares of the Fund shall have: (a) exclusive voting
rights on any matter submitted to shareholders that relates solely to its
distribution or shareholder servicing arrangements; (b) separate voting rights
on any matter submitted to shareholders in which the interests of one class
differ from the interests of any other class; and (c) in all other respects the
same rights and obligations as each other class.
10. On an ongoing basis, the Board of Trustees, pursuant to their
fiduciary responsibilities under the 1940 Act and otherwise, will monitor the
Fund for the existence of
-3-
<PAGE>
any material conflicts between the interests of the various classes of shares.
The Board, including a majority of the independent members of the Board, shall
take such action as is reasonably necessary to eliminate any such conflict that
may develop.
11. Before any material amendment to the Plan, a majority of the members
of the Board of the Fund, and a majority of the members of the Board who are not
interested persons of the Fund, shall find that the Plan as proposed to be
adopted or amended, including any expense allocation, is in the best interests
of each class individually and the Fund as a whole. Before any material
amendment, the Board shall request and evaluate such information as may be
reasonably necessary to evaluate the Plan.
Adopted June 18, 1998
-4-
<PAGE>
Exhibit P.
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Futures Association or any other federal or state
regulatory body ("Regulatory Agency"), on behalf of the Fund any and all
regulatory materials necessary or advisable to enable the Fund to comply with
the Securities Act of 1933, as amended, and/or the Investment Company Act of
1940, as amended, and other pertinent federal securities statutes, and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ Norton H. Reamer
----------------------------
Norton H. Reamer
Date: June 18, 1998
<PAGE>
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Futures Association or any other federal or state
regulatory body ("Regulatory Agency"), on behalf of the Fund any and all
regulatory materials necessary or advisable to enable the Fund to comply with
the Securities Act of 1933, as amended, and/or the Investment Company Act of
1940, as amended, and other pertinent federal securities statutes, and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ William A. Humenuk
--------------------------------
William A. Humenuk, Esq.
Date: June 18, 1998
<PAGE>
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Futures Association or any other federal or state
regulatory body ("Regulatory Agency"), on behalf of the Fund any and all
regulatory materials necessary or advisable to enable the Fund to comply with
the Securities Act of 1933, as amended, and/or the Investment Company Act of
1940, as amended, and other pertinent federal securities statutes, and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ Philip D. English
-----------------------------
Philip D. English
Date: June 18, 1998
<PAGE>
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Futures Association or any other federal or state
regulatory body ("Regulatory Agency"), on behalf of the Fund any and all
regulatory materials necessary or advisable to enable the Fund to comply with
the Securities Act of 1933, as amended, and/or the Investment Company Act of
1940, as amended, and other pertinent federal securities statutes, and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ Nancy J. Dunn
--------------------------
Nancy J. Dunn
Date: June 18, 1998
<PAGE>
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Futures Association or any other federal or state
regulatory body ("Regulatory Agency"), on behalf of the Fund any and all
regulatory materials necessary or advisable to enable the Fund to comply with
the Securities Act of 1933, as amended, and/or the Investment Company Act of
1940, as amended, and other pertinent federal securities statutes and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ John T. Bennett Jr.
------------------------------
John T. Bennett, Jr.
Date: June 18, 1998
<PAGE>
SEC FILINGS
POWER OF ATTORNEY
The undersigned Trustee/Director of UAM Funds, Inc., UAM Funds Trust and
UAM Funds Trust II (the "Funds") hereby appoints Michael E. DeFao, Audrey C.
Talley and Martin J. Wolin his true and lawful attorneys-in-fact with authority
to execute in the name of such Trustee/Director on behalf of the Fund and to
file with the U.S. Securities and Exchange Commission, Commodity Futures Trading
Commission, National Future Association or any other federal or state regulatory
body ("Regulatory Agency"), on behalf of the Fund any and all regulatory
materials necessary or advisable to enable the Fund to comply with the
Securities Act of 1933, as amended, and/or the Investment Company Act of 1940,
as amended, and other pertinent federal securities statutes, and any other
rules, regulations and requirements of such Regulatory Agency. The powers of the
aforesaid attorneys-in-fact are hereby expressly limited to the execution and
filing of such documents with the appropriate Regulatory Agency.
/s/ Peter M. Whitman, Jr.
--------------------------------
Peter M. Whitman, Jr.
Date: June 18, 1998
