Registration Nos. 33-82998; 811-
8706
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
x Pre-Effective Amendment No.
"
Post Effective Amendment No. 2 \R
x
and
REGISTRATION STATEMENT UNDER THE
x INVESTMENT COMPANY ACT OF 1940
Amendment No. 3 \R
x
(Check appropriate box or boxes)
ANCHOR RESOURCE AND COMMODITY TRUST
(Exact Name of Registrant as Specified in
Charter)
7022 BENNINGTON WOODS DRIVE
PITTSBURGH, PENNSYLVANIA 15237
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (412) 635-
76 10
It is proposed that this filing will become effective
(Check appropriate box)
x immediately upon filing pursuant to Paragraph (b) of Rule
485 " on ___________________ pursuant to Paragraph
(b)
" 60 days after filing pursuant to Paragraph (a)
" on (date) pursuant to Paragraph (a) of Rule (485 or
486)
Peter K. Blume, Esquire
Yukevich, Blume, Marchetti & Zangrilli,
P.C. One Gateway Center, Sixth Floor
Pittsburgh, PA 15222
(Name and Address of Agent for
Service)
The Registrant has
previously filed a
declaration of indefinite
registration of its shares
pursuant to Rule 24f-2 under the
Investment
Company Act of 1940.
The Registrant's Notice under Rule
24f2 for the fiscal
year ended
December 31, 1995 will be filed
on or before June 30, 1996
ANCHOR RESOURCE AND COMMODITY TRUST
Cross Reference sheet Pursuant to Rule 495(a)
Part A
Form Item Cross Reference
Item 1. Cover Page. Cover Page
Item 2. Synopsis. Shareholder Transaction
Expenses; Annual Trust
Operating Expenses
Item 3. Condensed Financial Information. Statement of
Selected Per Share Data.
Item 4. General Description of Registrant.Cover Page;
About
the Trust; Investment
Objective and Policies;
Specialized Investment
Techniques and Related Risks
Item 5. Management of the Trust.
(a) Management --
Trustees
(b) Manager --
Investment Adviser
(c) Not Applicable
(d) Miscellaneous
Information -- Custodian,
Transfer Agent and Dividend
Paying Agent
(e) Management --
Expenses
(f) Management --
Brokerage
Item 6. Capital Stock and Other Securities.
(a) About the
Trust;
Miscellaneous Information
(b) Not Applicable
(c) Not Applicable
(d) Not Applicable
(e) How to Purchase
Shares; Other Information
-- Shareholder
Inquiries
(f) About the
Trust;
Services for Shareholders -
Dividends and Distributions;
Taxes
Item 7. Purchase of Securities Being Offered.
(a) How to Purchase
Shares
(b) Determination
of
Net Asset Value
(c) How to Purchase
Shares
(d) How to Purchase
Shares
(e) Distribution of
Shares
Item 8. Redemption or Repurchase. Redemption and
Repurchase of Shares
Item 9. Pending Legal Proceedings. Not Applicable
Statement of
Additional
Part B Information Cross
Reference
Form Item
Item 10. Cover Page. Cover Page
Item 11. Table of Contents. Table of Contents
Item 12. General Information and History. Not
Applicable
Item 13. Investment Objectives and Policies. Investment
Objectives and Policies;
Specialized Investment
Techniques and Related Risks
Item 14. Management of the Fund. Management --
Officers
and Trustees
Item 15. Control Persons and Principal Holders
of Securities.
(a) Management
(b) Management
(c) Management --
Officers and Trustees
Item 16. Investment Advisory and Other Services.
(a), (b) Management --
Investment Advisory Contract
(c),(d),(e) Not Applicable
(f) Distribution
of
Shares
(g) Not
Applicable
(h) Miscellaneous
Information
(i) Not
Applicable
Item 17. Brokerage Allocation. Portfolio Security
Transactions
Item 18. Capital Stock and Other Securities. About the
Trust
Item 19. Purchase Redemption and Pricing
of Securities Being Offered.
(a),(b) How to Purchase
Shares; Determination of Net
Asset Value
(c) Not Applicable
Item 20. Tax Status. Taxes
Item 21. Underwriters. Distribution of Shares;
How
to Purchase Shares; Management
Item 22. Calculation of Performance Data. Not
Applicable
Item 23. Financial Statements. Financial Statements
Part C Other Information
Information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C of the Registration
Statement.
ANCHOR RESOURCE AND COMMODITY TRUST
PROSPECTUS
DATED MAY 1, 1996 \R
ANCHOR INVESTMENT MANAGEMENT CORPORATION
INVESTMENT ADVISER
7022 BENNINGTON WOODS DRIVE
PITTSBURGH, PENNSYLVANIA
15237
Anchor Resource & Commodity Trust (the "Trust") is a
diversified open-end management investment company. While originally
organized as an unincorporated business trust in October, 1989, the
Trust did not commence operations until January 12, 1995. Its
investments and affairs are managed, subject to the supervision of
its Trustees, by Anchor
Investment Management Corporation, a Massachusetts corporation
(the "Investment Adviser"). The address of the Trust is 7022
Bennington Woods Drive, Pittsburgh, Pennsylvania 15237, and its
telephone number is (412) 635-7610.
The primary investment objective of the Trust is long-term
growth of capital and the protection of the purchasing power
of its
shareholders' capital. The Trust seeks to achieve its
investment objective by investing in equity securities of domestic
and foreign companies that have substantial natural resource assets
or that engage in natural resource or energy-related activities.
As a secondary investment objective, the Trust will seek to
generate current income consistent with the preservation of
shareholders' purchasing power. See "Investment Objectives and
Policies" herein.
Anchor Resource and Commodity Trust is intended for investors
who are willing to accept the risks of investments in natural
resource companies. The
Trust's investments in equity securities of natural
resource companies involve certain risks not assumed by certain
other investment companies that do not emphasize investments in
particular industries or
markets. See "Risk Factors and Other Investor
Considerations" herein.
The Trust has adopted a Distribution Plan under Rule 12b-
1 of the Investment Company Act of 1940, providing for compensation to
the Trust's Distributor in respect of sales of Trust shares in the
maximum amount of 5% of the sale price (currently limited to .75 of
1% of the average daily net assets for any fiscal year) and in
addition may impose a related contingent deferred sales
charge, commencing at 4% in the
first calendar year and declining thereafter, in connection
with redemptions or repurchases made within four calendar years of
purchase of the shares redeemed or repurchased. The Distribution
Plan has not been made effective pending review and approval of
the Plan by the Trust's shareholders. See "Distribution of Shares"
herein and in the Statement of Additional Information.
No assurance can be given that the Trust's
investment objectives will be achieved.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
UPON
THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE. This Prospectus sets forth certain information about
the Trust
which investors should know before investing, and it should be
retained for future reference. Additional facts about the Trust are
contained in a Statement of Additional Information dated May 1, 1996
which has been
filed with the Securities and Exchange Commission. The Statement
and the Trust's Annual Report for 1995 are available without
charge by calling or by writing the Trust at the above
telephone number or address. The Statement of Additional
Information is incorporated by reference in this Prospectus.
TABLE OF CONTENTS
TABLE OF TRUST FEES AND EXPENSES 3
ANNUAL TRUST OPERATING EXPENSES 3
SELECTED PER SHARE DATA AND RATIOS 4
ABOUT THE TRUST 5
INVESTMENT OBJECTIVES AND POLICIES 6
Investment Strategy 6
Specialized Investment Techniques and Related Risks 8
Lending of Portfolio Securities 8
Repurchase Agreements 8
Portfolio Turnover 9
Investment Restrictions 9
RISK FACTORS AND OTHER INVESTOR CONSIDERATIONS
10
MANAGEMENT
11
Trustees
11
Investment Adviser
11
Expenses
12
Brokerage
12
Management Discussion of Fund Performance
12
HOW TO PURCHASE SHARES
13
DISTRIBUTION OF SHARES
13
Contingent Deferred Sales Charge
14
HOW TO EXCHANGE SECURITIES FOR TRUST SHARES
14
REDEMPTION AND REPURCHASE OF SHARES
15
DETERMINATION OF NET ASSET VALUE
16
SERVICES FOR SHAREHOLDERS
17
Open Accounts
17
Invest-By-Mail
17
DIVIDENDS AND DISTRIBUTIONS
17
TAXES
18
MISCELLANEOUS INFORMATION
18
Custodian, Transfer Agent and Dividend-Paying Agent
18
Shareholder Inquiries
18
APPLICATION FORM
19
TABLE OF TRUST FEES AND EXPENSES
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Load Imposed on Purchase None
Maximum Sales Load Imposed on Reinvested
Dividends
None
Deferred Sales Load (as a percentage of
original purchase price) (Note 1)
Year of Purchase 4.00%
Second Year
3.00%
Third Year
2.00%
Fourth Year
1.00%
Redemption Fees
None
Exchange Fees
None
ANNUAL TRUST OPERATING EXPENSES:
(AS A PERCENTAGE OF AVERAGE NET ASSETS) (NOTES 2 & 3)
Management Fees .75%
12b-1 Fees None
Other Expenses 0.36%
Total Trust Operating Expenses 1.11%
EXAMPLE:
1 Year 3
Years You would pay the following expenses on a$51 $55
$1,000 investment, assuming (1) 5% annual
return and(2) redemption at the end of each
time period:
You would pay the following expenses on the $11 $35
same investment, assuming (1) 5% annual
return and(2) no redemption:
THE ABOVE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF
PAST OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR
LESS
THAN THOSE SHOWN.
The purpose of this table is to assist the investor in
understanding the various costs and expenses that an investor
in the Trust will bear, directly or indirectly. This
information should be read in conjunction with the Trust's
Annual Report, which contains a more complete description of
the various costs and expenses and is incorporated by reference
in this Prospectus. Note 1. A contingent deferred sales
charge may be imposed upon
certain redemptions of shares purchased after inception of the
Trust's Distribution Plan. See "Contingent Deferred Sales
Charge" herein. The Trustees do not currently impose the
charge. Note 2. "Other Expenses" are estimated based on the
current
operating expenses of other similar funds under management by
the Investment Adviser. Also it should be noted that the
amount of the Trust's operating expenses as a percentage of the
Trust's average net assets is typically higher during the first
year of the Trust's operations as indicated above.
Note 3. The Trustees have set an aggregate limit on the amount
of
12b-1 payments equal to .75 of 1% of the Trust's average daily
assets for any fiscal year. The Trustees do not currently
impose the charge, since the Plan is not in effect.
SELECTED PER SHARE DATA AND RATIOS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD ENDED DECEMBER
31,)
The following information for the two years ended December
31, 1995 has been examined by Livingston & Haynes, P.C.,
independent accountants, and should be read in conjunction with
their report and the financial statements and notes
appearing in the Trust's Annual Report which are
incorporated by reference in this Prospectus.
Year Ended Year Ended
December December
31,1995 31,1994
Investment income $ 0.89 $
0.22
Expenses, net 0.32 2.20
Net investment loss 0.57
(1.98)
Net realized and unrealized gain (loss) on 0.13 --
investments
Distributions to shareholders:
From net investment income (0.58)
- --
From net realized gain on investments --
- --
Net decrease in net asset value 0.12
(1.98)
Net asset value:
Beginning of period 9.19 11.17
End of period $9.31 $9.19
Total Return 7.63%
(17.7
4% )
Ratio of expenses to average net assets 1.11%
20.12%
Ratio of net investment income to average net 2.01%
(18.13)
assets %
Portfolio turnover 0.33 --
Number of shares outstanding at end of period 782,903
12,000
Per share data and ratios assuming no
waiver of advisory fees:
Expenses $ 2.28
Net investment loss $
(2.06)
Ratio of expenses to average net assets 20.87%
Ratio of net investment loss to average net (18.88)
assets %
* Includes balancing effect of calculating per share amounts.
Note 1. All per share numbers give retroactive effect to stock
dividends.
Note 2. Investment income, operating expenses and net
income (loss) per share are computed based on the weighted
average shares outstanding throughout fiscal periods.
ABOUT THE TRUST
The Anchor Resource and Commodity Trust is a diversified
open-end management investment company established as an
unincorporated business trust under the laws of Massachusetts by
a Declaration of Trust dated October 2, 1989. The Trustees first
amended the Declaration of Trust in August, 1990 to change the
name of the Trust from Meeschaert Equity Plus Trust to Anchor
Equity Plus Trust, and subsequently amended the Declaration of
Trust in August 1994 to change the Trust's name to Anchor
Resource and Commodity Trust. The Trust first commenced
operations on January 12, 1995.
The capitalization of the Trust consists of an unlimited
number of shares of beneficial interest, without par value,
designated "Common Shares," which participate equally in
dividends and distributions. Issued shares are fully paid and
nonassessable and transferable on the books of the Trust. The
shares have no preemptive rights. The shares each have one vote
and proportionate liquidation rights.
The Trust normally will not hold annual meetings of
shareholders to elect Trustees. If less than a majority of the
Trustees holding office have been elected by shareholders, a
meeting of shareholders will be called to elect Trustees. The
Trust will, if requested by shareholders of at least ten percent
of the Trust's outstanding shares, call a meeting for the
purpose of voting on the removal of a Trustee or Trustees.
Under the Declaration of Trust and the Investment Company Act of
1940, the
record holders of not less than two-thirds of the outstanding
shares of the Trust may remove a Trustee by votes cast in
person or by proxy at a meeting called for the purpose or by a
written declaration filed with the Trust's custodian bank. In
connection with shareholder rights to remove Trustees, the
Trust will provide shareholders with certain assistance in
communicating with other shareholders. Except as described
above, the Trustees will continue to hold office and may
appoint successor Trustees.
Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of
the Trust. However, the Declaration of Trust disclaims
shareholder liability for acts or obligations of the Trust and
requires that notice of this disclaimer be given in each
agreement, obligation or instrument entered into or executed by
the Trust or a Trustee. The Declaration of Trust provides for
indemnification from the assets of the Trust for all losses and
expenses of any shareholder held personally liable for the
obligations of the Trust. Thus, the risk of a shareholder
incurring a financial loss on account of his or her liability
as a shareholder of the Trust is limited to circumstances in
which the Trust itself would be unable to meet its obligations.
The possibility that these circumstances would occur is remote.
Upon payment of any liability incurred by the Trust, the
shareholder paying the liability will be entitled to
reimbursement from the general assets of the Trust. The
Trustees intend to conduct the operations of the Trust to
avoid, to the extent possible, ultimate liability of
shareholders for liabilities of the Trust.
As of the date of this prospectus, Ex. & Co., as an
indirect
nominee of Societe D'Etudes et de Gestion Financieres,
Meeschaert, S.A. ("Societe D'Etudes"), 23 Rue Drouot, 75009,
Paris, France, held of record 100% of the outstanding shares of
the Trust. As of the date hereof, and since the original
formation of the Trust, Societe D'Etudes was the beneficial
owner of all of the outstanding shares of the Trust.
INVESTMENT OBJECTIVES AND POLICIES
The primary investment objective of the Trust is to
achieve long-term growth of capital and to protect the
purchasing power of its shareholders' capital by investing in
equity securities of domestic and foreign companies having
substantial natural resource assets or that engage in natural
resource or energyrelated activities. Protection of the
purchasing power of its shareholders' capital means that the
Trust seeks to protect generally shareholders' invested capital
against erosion of the value of the U.S. dollar through
inflation. This objective is fundamental and may not be
changed without shareholder approval. As a secondary investment
objective, the Trust will seek to generate current income
consistent with the preservation of shareholders' purchasing
power. The Trust will endeavor to achieve its objectives by
anticipating inflationary and deflationary economic cycles and
investing the Trust's assets as set forth under the "Investment
Strategy" below. There can, of course, be no guarantee that
the Trust's investment objectives will be achieved, due to the
uncertainty inherent in all investments.
Since the values of the portfolio securities of the Trust,
and therefore the net asset value per share, will fluctuate
with general economic and market conditions, the net asset
value per share at the time an investor's shares are redeemed
may be more or less than the value at the time of purchase.
Because of its emphasis on one industrial sector, the
Trust should be considered as one aspect of a diversified
portfolio and should not be considered as a complete investment
program.
INVESTMENT STRATEGY
I. Under normal circumstances, the Trust will pursue its
primary investment objectives by investing at least 65% of its
total assets in equity securities of domestic and foreign
companies with substantial natural resource assets, natural
resource or energy related activities, or that provide
equipment or services primarily devoted to the natural resource
or energyrelated activities of such companies.
Natural resource assets consist of precious metals (e.g.,
gold, silver, and platinum), ferrous and nonferrous metals
(e.g., iron, aluminum, and copper), strategic metals (e.g.,
uranium, and titanium), hydrocarbons (e.g., coal, oil, and
natural gas), timberland, developed and undeveloped real
property and agricultural commodities.
The Investment Adviser will identify companies that, in
its opinion, have substantial holdings of resource assets so
that when compared to the company's capitalization, revenues,
or operating profits, such assets are of enough magnitude that
changes in the assets' economic value will affect the market of
the company. The Trust will consider a company to be a Natural
Resource Company if, at the time the Trust acquires its
securities, at least 50% of the company's assets,
capitalization, gross revenues or operating profits in the most
recent or current fiscal year are: (1) involved in or result
from (directly or indirectly through subsidiaries) exploring,
mining, refining, processing, transporting, fabricating,
dealing in or owning resource assets; or (2) are involved in or
result from energyrelated activities directly or indirectly
through subsidiaries.
Energy-related activities consist of those activities
which
relate to the development and use of energy sources, such as:
1. the generation of power from hydroelectric, geothermal,
tidal, or other naturally occurring sources, or from natural
resource manufacturing by-products or refuse;
2. the development of synthetic fuels;
3. transportation of energy producing sources such as
coal, oil, electricity, or nuclear fuels;
4. the development and application of techniques and
devices for conservation or efficient use of energy; and,
5. the control of pollution related to energy
industries
and waste disposal.
Generally, a company will be considered to provide
equipment or services to such Natural Resource Companies if at
least 50% of the company's assets are invested in such Natural
Resource Companies, or at least 50% of its income is derived
from providing equipment or services to such Natural Resource
Companies. Examples of this kind of company are:
1. manufacturers of mining or earth moving equipment
2. providers of seismology testing services; and,
3. providers of supplies and maintenance services to
offshore drilling sites.
The Investment Adviser believes an investment in the Trust
may provide a good hedge against inflation.
II. When, based on an analysis of numerous economic and
monetary factors, including a declining rate of change in the
CPI, declining interest rates, and/or an increase in the value
of the U.S. dollar, the Investment Adviser expects a
deflationary cycle, the Trust will invest up to 90% of its
total assets in U.S. or foreign government and government
agency fixed-income securities of sufficient maturities to
realize its objective of long-term capital appreciation.
During such periods, the Trust will hold the balance of its
assets in short-term government securities, either U.S. or
foreign denominated. Investment in U.S. and other government
securities in anticipation of
deflationary periods is intended to preserve capital, while
providing a relatively secure income, and to provide an
opportunity for capital appreciation if interest rates decline
in such deflationary periods.
III. If, in the opinion of the Investment Adviser, there
are periods when there is a very small rate of change in the
Consumer Price Index, and other leading economic indicators,
such as interest rates and the value of the U.S. dollar, offer
no clear evidence of inflationary or deflationary trends, then,
for temporary defensive purposes, the Trust may invest up to
100% of its assets in cash or cash equivalents (in U.S. dollars
and foreign currencies) and high-quality short-term securities
having minimum credit ratings of AAA or Aaa, including money
market securities (such as certificates of deposit, commercial
paper and bankers' acceptances) and repurchase agreements.
In addition, the Trust may invest up to 100% of its assets
in securities principally traded on foreign securities markets
and in securities of foreign issuers that are traded on U. S.
securities markets, including American Depository Receipts.
The Trust may invest in securities of foreign issuers of both
developed and developing countries. For a discussion of the
risks associated with such investments see "Risk Factors and
Other Investor Considerations" herein.
With respect to the Trust's investments in the debt
securities of foreign corporations, it is the Trust's intention
to invest only in such securities which, at the time of
purchase, are determined by the Investment Adviser to have a
quality comparable to securities receiving investment grade
ratings (BBB by Standard & Poor's Corporation or Fitch
Investors Service, Inc. or Baa by Moody's Investors Service,
Inc.) or higher. Securities rated BBB or Baa, although
considered to be investment grade, may have speculative
characteristics in that changes in economic conditions or other
circumstances are more likely to lead to a weakened capacity of
the issuer to make principal and interest payments than is the
case for higher grade securities.
Foreign securities are generally purchased on foreign
exchanges, if they are listed. Other markets also exist over-
thecounter. There may be less publicly available information
about a foreign company than about a United States company, and
foreign companies may not be subject to uniform accounting,
auditing and financial reporting standards and requirements
comparable to those of United States companies. Foreign
securities markets, while growing in volume, have, for the most
part, substantially less volume than United States markets, and
securities of many foreign companies are less liquid and their
prices more volatile than securities of comparable domestic
companies. Brokerage commissions and other transactions costs
on foreign securities exchanges are generally fixed and are
higher than those in the United States. There is generally
less government supervision and regulation of exchanges,
brokers and issuers in foreign countries than there is in the
United States.
As a diversified investment company, the Trust is subject
to the following limitations as to 75% of its total assets: (a)
the Trust may not invest more than 5% of its total assets in
the securities of any one issuer, except obligations of the
U.S. Government and its agencies and instrumentalities; and (b)
the Trust may not own more than 10% of the outstanding voting
securities of any one issuer.
The extent to which the Trust will be able to achieve its
investment objective depends upon the Investment Adviser's
ability to evaluate and develop the information it receives
into a successful investment program. It should be emphasized
that the Investment Adviser will not apply a rigid, mechanical
determination in assessing whether the economy is in an
inflationary or disinflationary environment. Rather, its
determination will be the result of its subjective judgment of
all factors it considers to be relevant.
The policies set forth above are fundamental policies
and may not be changed without shareholder approval.
As a non-fundamental policy, the Trust presently does
not intend to invest directly in: (a) physical commodities
or in other natural resource assets or contracts related to
natural resource assets; (b) option transactions involving
portfolio securities and securities indices; (c) options on
foreign currencies; and (d) financial futures and related
options.
SPECIALIZED INVESTMENT TECHNIQUES AND RELATED RISKS
The Trust's investments are subject to the following two
(2) investment techniques, each of which may involve certain
risks which are summarized below and discussed in the Statement
of Additional Information. While in general such transactions
are not limited, reference is made to "Lending of Portfolio
Securities" and "Repurchase Agreements" herein for limitations
applicable to those activities. There can be no assurance that
the Trust will attain its investment objectives.
LENDING OF PORTFOLIO SECURITIES
The Trust may seek to increase its income by lending
portfolio securities in accordance with its secondary
investment objective of generating current income consistent
with the preservation of shareholders' purchasing power. Any
such loan will be continuously secured by collateral at least
equal to the market value of the security loaned. The Trust
would have the right to call a loan and obtain the securities
loaned at any time upon five days' notice. During the
existence of a loan, the Trust would continue to receive the
equivalent of the interest or dividends paid by the issuer on
the securities loaned and would also receive a fee, or the
interest on investment of the collateral, if any. The total
value of the securities loaned at any time will not be
permitted to exceed 30% of the Trust's total assets. As with
other extensions of credit, there are risks of delay in
recovery or even loss of rights in the collateral should the
borrower of the securities fail financially. However, the loans
would be made only to U.S. domestic organizations deemed by the
Trust's management to be of good standing and when, in the
judgment of the Trust's management, the consideration to be
earned justified the attendant risk.
REPURCHASE AGREEMENTS
A repurchase agreement is an agreement under which the
Trust acquires a money market instrument (a security issued by
the U.S. government or any agency thereof, a bankers'
acceptance or a certificate of deposit) from a commercial bank,
subject to resale to the seller at an agreed upon price and
date (normally the next business day). Such an agreement is,
in effect, a loan by the Trust. The resale price reflects an
agreed upon interest rate effective for the period the
instrument is held by the Trust and is unrelated to the
interest rate on the underlying instrument. The Trust will
effect repurchasing agreements only with large well-capitalized
banks whose deposits are insured by the Federal Deposit
Insurance Corporation and which have the capital and undivided
surplus of at least $200,000,000. The instrument acquired by
the Trust in these transactions (including accrued interest)
must have a total value in excess of the value of the
repurchase agreement and will be held by the Trust's custodian
bank until repurchased. The Trustees of the Trust will monitor
the Trust's repurchase agreement transactions on a continuous
basis and will require that the applicable collateral will be
retained by the Trust's custodian bank. No more than an
aggregate of 10% of the Trust's total assets, at the time of
investment, will be invested in repurchase agreements maturing
in more than seven days or in any other similarly illiquid
security which is subject to legal or contractual restrictions
on resale or which is not readily marketable. There is no
limitation on the
Trust's assets with respect to investments in repurchase
agreements having maturities of less than seven days.
The use of repurchase agreements involves certain risks.
For example, if the seller under a repurchase agreement
defaults on its obligation to repurchase the underlying
instrument at a
time when the value of the instrument has declined, the Trust
may incur a loss upon its disposition. If the seller becomes
insolvent and subject to liquidation or reorganization under
bankruptcy or other laws, a bankruptcy court may determine that
the underlying instrument is collateral for a loan by the Trust
and therefore is subject to sale by the trustee in bankruptcy.
Finally, it is possible that the Trust may not be able to
substantiate its interest in the underlying instrument. While
the Trust's Trustees acknowledge these risks, it is expected
that they can be controlled through careful monitoring
procedures.
PORTFOLIO TURNOVER
Securities will generally be purchased for possible long
term appreciation and not for short-term trading profits;
however, the rate of portfolio turnover is not a limiting
factor when the Investment Adviser deems changes appropriate.
It is anticipated that the Trust's annual portfolio turnover
rate will normally not exceed 50%. A rate of turnover of 100%
could occur, for example, if the value of the lesser of
purchases and sales of portfolio securities for a particular
year equaled the average monthly value of portfolio securities
owned during the year (excluding short-term securities).
A high rate of portfolio turnover involves a
correspondingly greater amount of brokerage commissions and
other costs which must be borne directly by the Trust and thus
indirectly by its shareholders. It may also result in the
realization of larger amounts of short-term capital gains which
are taxable to shareholders as ordinary income.
INVESTMENT RESTRICTIONS
The Trust has adopted certain fundamental investment
restrictions which are described in detail in the Statement of
Additional Information and may not be changed without
shareholder approval. Among these restrictions are that the
Trust may not: 1) purchase any securities if as a result such
purchase would cause more than 10% of the total outstanding
voting securities of the issuer to be held by the Trust; and 2)
invest more than an aggregate of 10% of the Trust's total
assets in repurchase agreements having maturities longer than
seven days and other investments subject to legal or
contractual restrictions on resale, or which are not readily
marketable.
For purposes of the above limitations: (i) all percentage
limitations apply immediately after a purchase or initial
investment; and (ii) any subsequent change in any applicable
percentage resulting from market fluctuations or other changes
in total or net assets does not require elimination of any
security from the portfolio. In addition, the practices
described above with respect to the lending of portfolio
securities are fundamental policies which may not be changed
without approval of the shareholders. Further information on
the Trust's investment restrictions may be found in the Trust's
Statement of Additional Information.
RISK FACTORS AND OTHER INVESTOR CONSIDERATIONS
The Trust concentrates its assets in the global natural
resource industries, and thus should not be considered as a
complete investment program. Under normal circumstances, the
Trust will invest at least 65% of its total assets in equity
securities of domestic and foreign companies with substantial
natural resource assets, natural resource or energy related
activities, or that provide equipment or services primarily
devoted to the natural resource or energy-related activities of
such companies. Because the Trust focuses on this specific
investment area, the price of the Trust's shares may be more
volatile than that of investment companies that do not
concentrate their investments in such a manner. The value of
Trust shares may be susceptible to factors affecting the
natural resource industries. The value of equity securities of
natural resource companies will fluctuate due to various
factors including changes in the market for the particular
natural resource in which the issuer is involved. Events
occurring in nature, inflationary pressures and international
politics can effect the overall supply and demand of a natural
resource and thereby the value of the companies involved in
such natural resource. In both the U.S. and foreign countries,
for example, these industries may be subject to greater
political, environmental and other governmental regulation than
other industries.
The nature of such regulation continues to evolve in both
the U.S. and foreign countries, and changes in governmental
policies and the need for regulatory approvals may have a
material effect on the products and services of natural
resource companies. For example, the exploration, development
and distribution of coal, oil and gas in the United States are
subject to significant federal and state regulation, which may
effect rates of return on such investments and the kinds of
services that may be offered.
In addition, many natural resource companies historically
have been subject to significant costs associated with
compliance with environmental and other safety regulations and
changes in the regulatory climate. Such governmental
regulations may also hamper the development of new
technologies, and it is impossible to predict the direction,
type or effect of any future regulation.
Further, competition is intense for many natural resource
companies. As a result, many of these companies may be
adversely affected in the future and the value of the
securities issued by such companies may be subject to increased
share price volatility.
The value of the Trust's securities will fluctuate in
response to stock market developments, as well as market
conditions for the particular natural resource with which the
issuer is involved. The price of the commodity will fluctuate
due to changes in worldwide levels of inventory, and changes,
perceived or actual, in production and consumption. The value
of natural resources may fluctuate directly with respect to
various stages of the inflationary cycle and perceived
inflationary trends and is subject to numerous factors,
including national and international politics. Further, the
Trust's investments in companies are expected to be subject to
irregular fluctuations in earnings, because these companies are
effected by changes in the availability of money, the level of
interest rates, and other factors.
Investment on an international basis involves certain
risks not involved in domestic investments, including
fluctuations in foreign exchange rates, costs of currency
conversion, currency blockage, future political and economic
developments, and the possible imposition of exchange controls
or other foreign governmental laws or restrictions. Since the
Trust may invest in securities denominated or quoted in
currencies other than the U. S. dollar, changes in foreign
currency exchange rates will affect the value of securities in
the portfolio and the unrealized appreciation or depreciation
of investments. In addition, with respect to certain foreign
countries there is the possibility of expropriation and
nationalization of assets,
confiscatory taxation, political or social instability or
diplomatic developments which could affect investments in those
countries. Interest and dividends, and possibly other amounts
received by the Trust with respect to foreign investments, may
be subject to withholding and other taxes at the source,
depending upon the laws of the country in which the investment
is made.
The Trust's investments in foreign securities involve
additional special risks for the following reasons: (1) there
may be less public information available about foreign
companies than is available about United States companies; (2)
foreign companies are not generally subject to the uniform
accounting, auditing and financial reporting standards and
practices applicable to United States companies; (3) foreign
stock markets have less volume than the United States markets,
and the securities of some foreign companies are less liquid
and more volatile than the securities of comparable United
States companies; (4) there may be less governmental regulation
of stock exchanges, brokers, listed companies and banks in
foreign countries than in the United States; (5) the Trust may
incur fees on currency exchanges when it changes investments
from one country to another; (6) the Trust's foreign
investments could be affected by expropriation, confiscatory
taxation, nationalization of bank deposits, establishment of
exchanges controls, political or social instability, diplomatic
developments or currency blockage; (7) fluctuations in foreign
exchange rates will affect the value of the Trust's portfolio
securities, the value of dividends and interest earned, gains
and losses realized on the sale of securities, net investment
income and unrealized appreciation or depreciation of
investments; (8) payments may be withheld at the source; and
(9) it may be more difficult to obtain legal judgments abroad.
There can, of course, be no assurance that the Trust will
achieve its investment objectives since there is uncertainty in
every investment. Further, given the foregoing risks and those
disclosed elsewhere in this Prospectus and in the Statement of
Additional Information, an investment in the Trust may not be
appropriate for all investors, particularly those who seek
assured income.
MANAGEMENT
TRUSTEES
Under the terms of the Declaration of Trust establishing
the Trust, which is governed by the laws of the Commonwealth of
Massachusetts, the Trustees of the Trust are ultimately
responsible for the management of its business and affairs. The
Statement of Additional Information contains backround
information regarding each Trustee and executive officer of the
Trust.
INVESTMENT ADVISER
The Investment Adviser, Anchor Investment Management
Corporation, manages the Trust's investments and affairs,
subject to the supervision of the Trust's Trustees. The
principal offices of both the Trust and the Investment Adviser
are located at 7022 Bennington Woods Drive, Pittsburgh,
Pennsylvania 15237.
For its services under its Investment Advisory
Contract
with the Trust (the "Investment Advisory Contract"), the
Investment Adviser receives a fee, payable monthly, calculated
at the rate of .75% per annum of the average daily net assets
of the Trust. This fee is higher than that of most other
investment companies. For the fiscal year ended December 31,
1995, the Investment Adviser received investment advisory fees
of $50,131 for its services to the Trust, which represented
.75% of the Trust's average net assets.\R
For each of the Trust's fiscal years ended December 31, 1994,
1993, 1992, 1991 and 1990, the Investment Adviser did not
receive
any investment advisory fees or other compensation under the
Investment Advisory Contract because the Trust had not
commenced operations during any such year.
The Investment Adviser and Meeschaert & Co., Inc., the
Trust's underwriter (the "Distributor"), are affiliated through
common control with Societe D'Etudes et de Gestion Financieres
Meeschaert, S.A., one of France's largest privately owned
investment management firms, which together are referred to as
the "Meeschaert Organization." The Meeschaert Organization was
established in Roubaix, France in 1935 by Emile C. Meeschaert,
and presently manages, with full discretion, an aggregate
amount of approximately $1.5 billion for approximately 8,000
individual (and institutional) customers, including $250
million in French mutual funds.
The person who is primarily responsible for the day-to-day
management of the Trust's portfolio is Paul Jaspard, who is a
Vice President of the Investment Adviser. Mr. Jaspard is
President of Global Equity Managers, S.A., an investment
advisory firm headquartered in Luxembourg. He has managed
other portfolios for the Meeschaert Organization for more than
eighteen years.
EXPENSES
The Trust is responsible for all its expenses that are not
assumed by the Investment Adviser under the Investment Advisory
Contract, including without limitation, the fees and expenses
of the custodian and transfer agent; costs incurred in
determining the Trust's net asset value and keeping its books;
the cost of share certificates; membership dues in investment
company organizations; distribution and brokerage commissions
and fees; fees and expenses of registering its shares; expenses
of reports to shareholders, proxy statements and other expenses
of shareholders' meetings; insurance premiums; printing and
mailing expenses; interest, taxes and corporate fees; legal and
accounting expenses; and fees and expenses of Trustees not
affiliated with the Investment Adviser. The Trust will also
bear expenses incurred in connection with litigation in which
the Trust is a party and the legal obligation the Trust may
have to indemnify its officers and Trustees with respect
thereto. For the fiscal year ended December 31, 1995, expenses
borne by the Trust amounted to $74,965.00 which represented
1.11% of the Trust's average net assets. \R
BROKERAGE
Decisions to buy and sell portfolio securities for the
Trust are made pursuant to recommendations by the Investment
Adviser. The Trust, through the Investment Adviser, seeks to
execute its portfolio security transactions on the most
favorable terms and in the most effective manner possible. To
the extent consistent with the policy of seeking best price and
execution, a portion of the Trust's portfolio transactions may
be executed through the Distributor, which is an affiliate of
the Investment Adviser. In the event that this occurs, it will
be on the basis of what management believes to be current
information as to rates which are generally competitive with
the rates available from other responsible brokers and the
lowest rates, if any, currently offered by the Distributor. In
selecting among broker-dealer firms to execute its portfolio
transactions, the Trust, through the Investment Adviser, may
give consideration to those firms which have sold or are
selling shares of the Trust, and who furnish other services to
the Trust or the Investment Adviser.
MANAGEMENT DISCUSSION OF FUND PERFORMANCE
The Trust received a majority of its current assets in the
first half of January 1995. During the first quarter, the
assets were invested 50% in German marks and 50% in US dollar
interestbearing instruments. At the end of March, the dollar
denominated assets had been invested in a selected number of
North American stocks in the sectors of oil and gas and non
ferrous metals and
minerals. The Trust ended its first year of operations with a
positive return. \R
The average annual total return for a share of the Trust was as
follows for the period indicated:
7.63% for the one year period beginning on January
1,
1995 through December 31, 1995; \R
HOW TO PURCHASE SHARES
Shares of the Trust may be purchased from the Meeschaert &
Co., Inc., 7022 Bennington Woods Drive, Pittsburgh,
Pennsylvania 15237. There is no sales charge or commission
payable by the investor with respect to purchases of shares.
For new shareholders initiating accounts, the minimum
investment is $500, except for exchanges of securities for
Trust shares, where the minimum is $5,000 (see "How to Exchange
Securities for Trust Shares" below). There is no minimum for
shareholders purchasing additional shares for deposit to
existing accounts.
An application for use in making an initial investment in
the Trust is included in the back of this Prospectus. The
applicable price will be the net asset value next determined
after the order is received by the Distributor. (See
"Determination of Net Asset Value.")
DISTRIBUTION OF SHARES
In addition to advisory fees and other expenses, the Trust
may pay for certain expenses pursuant to a distribution plan
(the "Plan") designed to meet the requirements of Rule 12b-1
("Rule 12b-1") under the Investment Company Act of 1940 (the
"Act"). The Plan, which has been approved by the Board of
Trustees of the Trust but will not be implemented unless and
until approved by a majority (as defined in the Act) of the
Trust's shareholders, is of the type sometimes called a
compensation plan. The Plan provides that the Trust will pay
the Distributor a commission equal to up to 5% of the price
paid to the Trust for each sale, all or any part of which may
be re-allowed by the Distributor to others (dealers) making
such sales. To the extent that the distribution fee is not
paid to such dealers, the Distributor may use such fee for its
expenses of distribution of Trust shares. If such fee exceeds
its expenses, the Distributor may realize a profit from these
arrangements. The Plan currently provides for an aggregate
limit on the amount of all payments pursuant to the Plan equal
to .75 of 1% of the Trust's average daily net assets for any
fiscal year. If, so long as the Plan is in effect, the
Distributor's reallowances to dealers and other expenses exceed
the limit (currently .75 of 1%) for any particular year, it
could
collect in any future year such amounts (which do not include
interest or other carrying charges) up to any amount by which
amounts paid to it under the Plan in that year are less than
the earlier year's limit. In such a case it might receive
amounts in excess of its then current expenses. The
Distributor's expenses are likely to be higher in the early
years of the Trust and accordingly, the annual fees received by
the Distributor in the early years are not likely to reimburse
the Distributor for the total distribution expenses that it
will incur in those years. The following numerical example
demonstrates this principle: If, in each of the first three
years of sales of the Trust's shares, sales by the Distributor
equaled $1,000,000, and the Distributor's total expenses for
such years were $60,000, $55,000 and $45,000, respectively, the
Distributor's expenses would exceed the Distributor's expected
commissions of $50,000 for the first two years. (Note: this
example does not take into account the .75 of 1% aggregate
limit discussed above.)
Meeschaert & Co., Inc. serves as the Trust's principal
underwriter under a Distributor's Contract dated December 16,
1994.
CONTINGENT DEFERRED SALES CHARGE
In conjunction with, but not as part of, the Plan, a
contingent deferred sales charge may be imposed upon certain
redemptions of shares purchased after inception of the Plan.
The charge in respect of such redemptions made during the first
four calendar years following purchase of the shares is as
follows: 4% in the year of purchase; 3% in the second year; 2%
in the third year; and 1% in the fourth year. These charges
are not received by the Distributor and will not reduce amounts
paid to the Distributor under the Plan.
HOW TO EXCHANGE SECURITIES FOR TRUST SHARES
When shares of the Trust are being offered, the Trust may
accept U.S. Government securities and U.S. Government agency
fixed-income securities acceptable to the Investment Adviser in
exchange for shares of the Trust at net asset value. The
minimum value of securities accepted for deposit in any single
transaction is $5,000. The Trust will value accepted
securities in the manner provided for valuing its portfolio
securities (see "Determination of Net Asset Value").
Securities determined to be acceptable for the Trust, in
proper form for transfer to the Trust, together with a
completed and signed letter of transmittal in approved form
(available from the Distributor) ("Letter of Transmittal"),
should be forwarded to the Trust as follows:
Investors Bank & Trust Company
Financial Product Services Group
Attn: Anchor Resource and Commodity Trust
1 Lincoln Plaza
Boston, Massachusetts 02205
An investor must forward all securities pursuant to a
single Letter of Transmittal or, in certain instances as
indicated in the Instructions to the Letter of Transmittal,
multiple Letters of Transmittal attached and transmitted as a
single exchange. The Trust will only accept securities which
are delivered in proper form.
An investor will be required to represent, among other
things, that the securities forwarded are not subject to any
restrictions upon their sale by the Trust by reason of any
agreement or representation that the investor has made in
respect thereof, or of his being in control of, controlled by,
or under common control with, the issuer thereof within the
meaning of Section 2(11) of the Securities Act of 1933, or for
any other reason. The Trust will not accept securities for
exchange if, in the opinion of its counsel, acceptance would
violate any federal or other law to which the Trust is subject.
Investors who are contemplating an exchange of securities
for shares of the Trust, or their representatives, are advised
to contact the Distributor to determine whether the securities
are acceptable to the Trust before forwarding such securities.
The Trust reserves the right to reject any securities when it
determines in its sole discretion that it is in the best
interests of the Trust to do so.
If securities presented for exchange are found to be in
good order only in part, the Trust may issue the appropriate
number of shares in accordance with the procedure described
below for such part and return the balance to the investor or,
at its option, may waive any or all irregularities to the
extent permissible under applicable law and issue shares for
all or a portion of such defective presentation. A
confirmation for shares of the
Trust will be issued to an investor after accepted securities
presented by him have cleared for transfer to the Trust. No
certificates will be issued unless requested by the investor.
By tendering securities, an investor agrees to accept the
determination of market value by the Trustees concurrently with
the determination of the Trust's net asset value per share.
The number of shares of the Trust to be issued to an investor
in exchange for securities shall be the value of such accepted
securities determined in the manner described above, divided by
the net asset value per Trust share next determined after the
Trust's acceptance of such securities.
A gain or loss for federal tax purposes may be realized by
an investor in connection with the exchange of securities for
shares of the Trust, depending upon his tax cost basis for the
securities tendered for exchange. Each investor should consult
his tax advisor with respect to the particular federal income
tax consequences, as well as any state and local tax
consequences, of exchanging his securities for Trust shares.
REDEMPTION AND REPURCHASE OF SHARES
Any shareholder may require the Trust to redeem his
shares. In addition, the Trust maintains a continuous offer to
repurchase its shares. If a shareholder used the services of a
broker in selling his shares in the over-the-counter market,
the broker may charge a reasonable fee for his services.
Redemptions and repurchases will be made in the following
manner.
1. Certificates for shares of the Trust may be mailed or
presented, duly endorsed, with signatures guaranteed in the
manner described below, with a written request that the Trust
redeem the shares, to the Trust's transfer agent, Anchor
Investment Management Corporation, at 7022 Bennington Woods
Drive, Pittsburgh, Pennsylvania 15237. If no certificate has
been issued and shares are held in an Open Account, a written
request that the Trust redeem such shares, with signatures
guaranteed in the manner described below, may be mailed or
presented as described above. The redemption price will be the
net asset value next determined after the request and/or
certificates are received.
2. A request for repurchase may be communicated to the
Trust by a shareholder through a broker. The repurchase price
will be the net asset value next determined after the request
is received by the Trust, provided that, if the broker receives
the request before noon and transmits it to the Trust before
1:00 p.m. Eastern Time the same day, the repurchase price will
be the net asset value determined as of 12:00 noon Eastern Time
that day. If the broker receives the request after noon, the
repurchase price will be the next asset value determined as of
12:00 noon Eastern Time the following day. If an investor uses
the services of a broker in having his shares repurchased, the
broker may charge a reasonable fee for his services.
Payment for shares redeemed or repurchased will be
delivered within seven days after receipt of the shares, and/or
required documents, duly endorsed. The signature(s) on an
issued certificate must be guaranteed by a commercial bank or
trust company or by a member of the New York, American, Pacific
Coast, Boston or Chicago Stock Exchange. A signature guarantee
by a savings bank or savings and loan association or
notarization by a notary public is not acceptable.
In order to ensure proper authorization the transfer agent may
request additional documents such as, but not restricted to,
stock powers, trust instruments, certificates of corporate
authority and waiver of tax required in some states from
selling estates before repurchasing shares.
The right of redemption may be suspended or the payment
date postponed when the New York Stock Exchange is closed for
other than customary weekend or holiday closings, or when
trading on the New York Stock Exchange is restricted, as
determined by the Securities and Exchange Commission; for any
period when an emergency as defined by the rules of the
Commission exists; or during any period when the Commission
has, by order, permitted such suspension. In case of a
suspension of the right of redemption, a shareholder who has
tendered a certificate for redemption or made a request for
repurchase through a broker may withdraw his request or
certificate or, absent such withdrawal, he will receive payment
of the net asset value determined nest after the suspension has
been terminated.
A Shareholder may receive more or less than he paid for
his shares, depending on the net asset value of the shares at
the time of redemption or repurchase.
DETERMINATION OF NET ASSET VALUE
The net asset value is determined by the Trust as of 12:00
noon Eastern Time on each business day on which the New York
Stock Exchange is open for trading or on any day that the Trust
is open for business, but the New York Stock Exchange is not
open for business, if there occurs an event which might
materially affect the net asset value of the Trust's redeemable
shares.
The manner of determination of the net asset value is
briefly as follows: Securities traded on a U.S. national or
other foreign securities exchange are valued at the last sale
price on the primary exchange on which they are listed, or if
there has been no sale that day, at the current bid price.
Other U.S. and foreign securities and foreign currencies for
which market quotations are readily available are valued at the
known current bid price believed most nearly to represent
current market value. Other securities (including limited
traded securities) and all other assets of the Trust are valued
at fair value as determined in good faith by the Trustees of
the Trust. Liabilities are deducted from the total, and the
resulting amount is divided by the number of shares
outstanding.
Each day investment securities traded on a national
securities exchange are valued at the noon sales price;
securities traded in the over-the-counter market are valued at
the last sale price as of 12:00 noon. Gold bullion is valued
each day at noon based on the New York spot gold price. Gold
coins, foreign currencies, and foreign denominated securities
for which market quotations are readily available are valued at
the known bid prices as of 12:00 noon. Temporary cash
investments are stated at cost. In the absence of a reliable
market for a particular metal, security or currency, an
investment therein will be valued at fair value as determined
in good faith by the Trustees.
SERVICES FOR SHAREHOLDERS
OPEN ACCOUNTS
As a convenience to the shareholder, all shares of the
Trust registered in his name are automatically credited to an
Open Account maintained for him on the books of the Trust. All
shares acquired by the shareholder will be credited to his Open
Account and share certificates will not be issued unless
requested. Certificates representing fractional shares will not
be issued in any case. Certificates previously acquired may be
surrendered to the Trust's transfer agent, such certificates
will be canceled
and the share represented thereby will continue to be credited
to the Open Account of the shareholder.
Each time shares are credited to his Open Account, the
shareholder will receive a statement showing the details of the
transaction and the then current balance of shares owned by
him. Shortly after the end of each calendar year he will also
receive a complete annual statement of his Open Account as well
as information as to the federal tax status of dividends and
capital gain distributions, if any, paid by the Trust during
the year.
Shares credited to an Open Account are transferable upon
written instructions to the Trust's transfer agent.
INVEST-BY-MAIL
An Open Account provides a single and convenient way of
setting up a flexible investment program for the accumulation
of shares of the Trust. At any time when the Trust is offering
its shares the shareholder may send a check (payable to the
order of the Trust) to Investors Bank & Trust Company--
Shareholders Services, Attn: Anchor Resource and Commodity
Trust, 24 Federal Street, Boston, Massachusetts 02110 (giving
the full name or names of his account). The check will be used
to purchase additional shares for his Open Account at the net
asset value next determined after the check is received. Any
check not payable to the order of the Trust will be returned.
The cost of administering Open Accounts for the benefit of
shareholders who participate in them will be borne by the Trust
as an expense of all its shareholders.
DIVIDENDS AND DISTRIBUTIONS
The Trust currently intends to distribute any dividends
and distributions in additional shares, or, at the option of
the shareholder, in cash. In accordance with his distribution
option, a shareholder may elect (1) to receive both dividends
and capital gain distributions in additional shares, or (2) to
receive dividends in cash and capital gain distributions in
additional shares, or (3) to receive both dividends and capital
gain distributions in cash. A shareholder may change his
distribution option at any time by notifying the Trust's
transfer agent in writing. To be effective with respect to a
particular dividend or distribution, the new distribution
option must be received by the transfer agent at least 30 days
prior to the close of the fiscal year. All accounts with a
cash dividend option will be changed to reinvest both dividends
and capital gains automatically upon determination by the
Trust's transfer agent that the address of record is not
current.
Dividends and capital gain distributions received in
shares will be received by the Trust's transfer agent, as agent
for the shareholder, and credited to his Open Account in full
and fractional shares computed at the record date closing net
asset value.
TAXES
The Trust intends to qualify under Subchapter M of the
Internal Revenue Code as a regulated investment company and to
distribute substantially all investment income and capital
gains, if any, at least once every year so that, to the extent
of such distributions, the Trust will not be subject to federal
income taxes.
Shareholders will be subject to federal income taxes on
distributions made by the Trust whether they are received in
cash or additional Trust shares. Distributions of net
investment income and short-term capital gains, if any, will be
taxable to shareholders as ordinary income. Distributions of
long-term capital gains, if any, will be taxable to
shareholders as longterm capital gains, without regard to how
long a shareholder has held shares of the Trust. Dividends
paid by the Trust will
generally not qualify for the dividends received deductions for
corporations. The Trust will notify shareholders each year of
the amount of dividends and distributions, including the amount
of any distribution of long-term capital gains.
The Trust's foreign investments may be subject to foreign
withholding taxes. The Trust will be entitled to claim a
deduction for such foreign withholding taxes for federal income
tax purposes. However, any such taxes will reduce the income
available for distribution to shareholders.
The Trust is required to withhold 20% of the dividends
paid with respect to any shareholder who fails to furnish the
Trust with a correct taxpayer identification number, who under-
reported dividend or interest income, or who fails to certify
to the Trust that he or she is not subject to such withholding.
An individual's tax identification is his or her social
security number.
The foregoing is a general and abbreviated summary of the
applicable provisions of the Internal Revenue code and Treasury
regulations currently in effect. For the complete provisions,
reference should be made to the pertinent Code sections and
regulations. The Code and regulations are subject to change by
legislative or administrative actions.
MISCELLANEOUS INFORMATION
CUSTODIAN, TRANSFER AGENT AND DIVIDEND-PAYING AGENT
All securities, cash and other assets of the Trust are
received, held in custody and delivered or distributed by
Investors Bank & Trust Company, Custodian, 24 Federal Street,
Boston, Massachusetts 02110, provided that in cases where
foreign securities must, as a practical matter, be held abroad,
the Trust's custodian bank and the Trust will make appropriate
arrangements so that such securities may legally be so held
abroad. The Trust's custodian bank does not decide on
purchases or sales of portfolio securities or the making of
distributions. Anchor Investment Management Corporation, 7022
Bennington Woods Drive, Pittsburgh, Pennsylvania 15237, serves
as transfer agent and dividend-paying agent for the Trust.
SHAREHOLDER INQUIRIES
For further information about the Trust, investors should
call (412) 635-7610. Written inquiries should be addressed to
Anchor Resource and Commodity Trust, 7022 Bennington Woods
Drive, Pittsburgh, Pennsylvania 15237.
ANCHOR RESOURCE AND COMMODITY TRUST
(THE "TRUST")
MEESCHAERT & CO., INC.
("DISTRIBUTOR")
APPLICATION AND REGISTRATION
FORM1 SEND APPLICATION
TO
MEESCHAERT & CO., INC., 7022 BENNINGTON WOODS DRIVE,
PITTSBURGH, PENNSYLVANIA 15237
Date:
__________________
_
I. ACCOUNT REGISTRATION:
New: Social Security or Tax
Number___________________________________________________
(if two names below, circle which one has this
number.)
Existing: Account Number
__________________________________________________________
(from your latest statement -
vital
for identification.)
Name(s)
_______________________________________________________________
__ _______________
(Type or print exactly as they are to appear on
the Trust's records.)
Street
_______________________________________________________________
__ _________________
City __________________________________________ State
______________________ Zip __________
If address outside the U.S.A., please circle I (am) (am not) a
citizen of the U.S.A.
If registration requested in more than one name, shares will be
registered as "Joint Tenants with Rights of Survivorship"
unless otherwise instructed.
II. BASIS FOR OPENING NEW ACCOUNT:
A check for $_______________ payable to the Trust
attached. or
Shares _______________ recently purchased on
_________________________
(number) (date)
DISTRIBUTION OPTION: (exercisable only by holders of Common
Shares) Check only one. If none checked, option A will be
assigned.
A. Dividends and capital gains in additional full and
fractional shares credited to shareholder's account, no
certificates issued.
OR
B. Dividends in cash; capital gains in additional full
and fractional shares credited to shareholder's account; no
certificates issued.
OR
C. Dividends in cash; capital gains in cash.
(Certificates will be issued to shareholders requesting such in
writing from the Transfer Agent.)
III. INVEST-BY-MAIL SERVICE: FOR PERIODIC SHARE ACCUMULATION
(WHETHER OR NOT DIVIDENDS ARE RECEIVED IN SHARES)
Please check if you wish to utilize the Trust's Invest-By
Mail Service. This is a voluntary service involving no extra
charge to the shareholder, and it may be changed or
discontinued at any time.
IV. SHAREHOLDER'S SIGNATURE: Should be the same as name in
Account Registration.
__________________________________
_____________________________________
Signature Signature of Co-
Owner (if any)
(I have received a current prospectus of the Trust and I
understand that my account will be covered by the provisions
on
the reverse side of this Application. I also understand that I
may terminate any of these services at any time.)
DEALER AUTHORIZATION:
(please print)
Representative
_________________________________
_____________________________________
Dealer's Name
(Representative's
Name)
_________________________________
_____________________________________
Home Office Address Telephone
Number(Representative's Number)
Branch Office:
_________________________________
_____________________________________
City State Zip Address
_________________________________
_____________________________________
Telephone Number Authorized Signature of
Dealer
City State Zip
ANCHOR RESOURCE AND COMMODITY TRUST
7022 BENNINGTON WOODS DRIVE
PITTSBURGH, PENNSYLVANIA 15237
(412) 635-7610
STATEMENT OF ADDITIONAL
INFORMATION
Dated May 1, 1996 \R
This Statement of Additional Information is not a
prospectus. This Statement of Additional Information
supplements the information contained in the Prospectus of
Anchor Resource and Commodity Trust (the "Trust"), dated May
1, 1996 and should be read in conjunction with the Trust's
Prospectus. \R
TABLE OF CONTENTS
ABOUT THE TRUST 3
INVESTMENT STRATEGY 3
GENERAL RISK CONSIDERATIONS 6
SPECIALIZED INVESTMENT TECHNIQUES AND RELATED RISKS 7
Lending of Portfolio Securities 7
Repurchase Agreements 7
PORTFOLIO TURNOVER
7
INVESTMENT RESTRICTIONS
8
MANAGEMENT
9
Officers and Trustees
9
Remuneration of Officers and Trustees
10
Investment Advisory Contract
10
Investment Adviser
11
PRINCIPAL HOLDERS OF SECURITIES
11
DETERMINATION OF NET ASSET VALUE
11
Specimen Price Make-up Sheet
12
DISTRIBUTION OF SHARES
12
Contingent Deferred Sales Charge
13
HOW TO PURCHASE SHARES
13
REDEMPTION, EXCHANGE AND REPURCHASE OF SHARES
13
DISTRIBUTIONS
14
TAXES
14
PORTFOLIO SECURITY TRANSACTIONS
15
MISCELLANEOUS INFORMATION
16
Custodian, Transfer Agent and Dividend-Paying Agent
16
Independent Public Accountants
16
Registration Statement
16
FINANCIAL STATEMENTS
16
ABOUT THE TRUST
The Trust was established as an unincorporated business
trust under the laws of Massachusetts by a Declaration of Trust
dated September 22, 1989. The Trust first commenced operations
on January 12, 1995.
The Trustees amended the Declaration of Trust in 1990 to
change the name of the Trust from Meeschaert Equity Plus Trust
to Anchor Equity Plus Trust and again in 1994 to change the
name to
Anchor Resource and Commodity Trust.
The capitalization of the Trust consists of an unlimited
number of shares of beneficial interest, without par value,
designated "Common Shares", which participate equally in
dividends and distributions. Issued shares are fully paid and
non-assessable and transferable on the books of the Trust. The
shares have no preemptive rights. The shares each have one
vote and proportionate liquidation rights.
The Trust normally will not hold meetings of shareholders
to elect Trustees. If less than a majority of the Trustees
holding office have been elected by shareholders, a meeting of
shareholders will be called to elect Trustees. The Trust will,
if requested by shareholders of at least ten percent of the
Trust's outstanding shares, call a meeting for the purpose of
voting on the removal of a Trustee or Trustees. Under the
Declaration of Trust and the Investment Company Act of 1940,
the record holders of not less than two-thirds of the
outstanding shares of the Trust may remove a Trustee by votes
cast in person or by proxy at a meeting called for the purpose
or by a written declaration filed with the Trust's custodian
bank. In connection with shareholder rights to remove
Trustees, the Trust will provide shareholders with certain
assistance in communicating with other shareholders. Except as
described above, the Trustees will continue to hold office and
may appoint successor Trustees.
Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of
the Trust. However, the Declaration of Trust disclaims
shareholder liability for acts or obligations of the Trust and
requires that notice of this disclaimer be given in each
agreement, obligation or instrument entered into or executed by
the Trust or a Trustee. The Declaration of Trust provides for
indemnification from the assets of the Trust for all losses and
expenses of any shareholder held personally liable for the
obligations of the Trust. Thus, the risk of a shareholder
incurring a financial loss on account of his or her liability
as a shareholder of the Trust is limited to circumstances in
which the Trust itself would be unable to meet its obligations.
The possibility that these circumstances would occur is remote.
Upon payment of any liability incurred by the Trust, the
shareholder paying the liability will be entitled to
reimbursement from the general assets of the Trust. The
Trustees intend to conduct the operations of the Trust to
avoid, to the extent possible, ultimate liability of
shareholders for liabilities of the Trust.
INVESTMENT STRATEGY
The Trust's Prospectus contains a description of the
investment objectives and policies of the Trust, including a
discussion of specialized techniques that the Trust may use in
order to achieve its investment objectives and certain risks
related thereto. The following discussion is intended to
provide further information concerning investment strategy,
techniques, and risk considerations which the Investment
Adviser believes to be of interest to investors.
Historically, during periods of increasing inflation and
during periods of economic or monetary instability, the prices
of commodity and resource-related equity securities have
tended to increase as rapidly or more rapidly than the rate of
inflation. Also, currencies of countries not involved in
inflationary circumstances may increase in value relative to
the U.S. dollar. During these same periods, interest rates have
tended to increase, causing the market value of debt
instruments to decline. Conversely, during periods of
deflation (when inflationary forces are being reversed) the
price of high grade debt instruments has tended to increase
while the value of commodity and resource-related equity
securities have tended to decline. Foreign currencies
(relative to the U.S. dollar) may also decline in value at such
times.
Accordingly, the Investment Adviser will seek to
anticipate oncoming inflationary and deflationary economic
cycles because of their significant effect on the value of the
Trust's investments in natural resources and commodity related
equity securities.
The Investment Adviser's determination as to whether the
economy is inflationary or deflationary will be based upon
constant study of numerous economic and monetary factors.
These factors will include, but not necessarily be limited to:
actual and anticipated rates of change in the Consumer Price
Index ("CPI") over specified periods of time; actual and
anticipated changes and rates of changes in the U.S. dollar in
relation to other key currencies, e.g., the German mark, the
British pound and the Japanese yen; actual and anticipated
changes, and rates of change, in short and long term interest
rates and real interest rates, i.e., inflation adjusted
interest rates; actual and anticipated changes in the money
supply; and actual and anticipated governmental fiscal and
monetary policy. It should be emphasized that the Investment
Adviser will not apply a rigid, mechanical determination in
assessing whether the economy is an inflationary or
disinflationary environment. Rather, its determination will be
the result of its subjective judgment of all factors it
considers relevant.
Under normal circumstances, when, by reason of a rising
rate of change in the CPI, rising interest rates, and/or a
decline in the value of the U.S. dollar, an inflationary cycle
is expected, the Trust will invest at least 65% of the value of
its total assets in equity securities of domestic and foreign
companies with substantial natural resource assets, natural
resource or energy-related activities, or that provide
equipment or services primarily devoted to the natural resource
or energy-related activities of such companies.
Natural resource assets consist of precious metals
(e.g., gold, silver, and platinum), ferrous and nonferrous
metals (e.g., iron, aluminum, and copper), strategic metals
(e.g., uranium, and titanium), hydrocarbons (e.g., coal, oil,
and natural gas), timberland, developed and undeveloped real
property and agricultural commodities.
The Investment Adviser will identify companies
that, in its opinion, have substantial holdings of resource
assets so that when compared to the company's capitalization,
revenues, or operating profits, such assets are of enough
magnitude that changes in the assets' economic value will
affect the market of the company. The Trust will consider a
company to be a Natural Resource Company if, at the time the
Trust acquires its securities, at least 50% of the company's
assets, capitalization, gross revenues or operating profits in
the most recent or current fiscal year are: (1) involved in or
result from (directly or indirectly through subsidiaries)
exploring, mining, refining, processing, transporting,
fabricating, dealing in or owning resource assets; or (2) are
involved in or result from energyrelated activities directly or
indirectly through subsidiaries.
Energy-related activities consist of those activities
which relate to the development and use of energy sources, such
as:
1. the generation of power from hydroelectric, geothermal,
tidal, or other naturally occurring sources, or from natural
resource manufacturing by-products or refuse;
2. the development of synthetic fuels;
3. transportation of energy producing sources such as
coal, oil, electricity, or nuclear fuels;
4. the development and application of techniques and
devices for conservation or efficient use of energy; and,
5. the control of pollution related to energy industries
and waste disposal.
Generally, a company will be considered to provide
equipment or services to such Natural Resource Companies if at
least 50% of
the company's assets are invested in or at least 50% of its
income is derived from providing equipment or services to such
Natural Resource Companies. Examples of this kind of company
are:
1. manufacturers of mining or earth moving equipment
2. providers of seismology testing services; and,
3. providers of supplies and maintenance services to
offshore drilling sites.
The Investment Adviser believes an investment in the Trust
may provide a good hedge against inflation.
Assets of the Trust not invested as described above will
largely be invested in debt instruments of the U.S. Government
and its agencies having varied maturities or in repurchase
agreements or loans of securities as described below. As used
herein, the following terms have the indicated definitions:
"equity securities" means shares in a corporation, whether or
not transferable or denominated 'stock', or similar security,
interest of a limited partner in a limited partnership, or
warrants or rights other than rights to convert, to purchase,
sell, or subscribe to a share, security, or interest of a kind
previously specified; and "convertible securities" means
debentures or preferred stock that may be exchanged by the
owner for common stock or another security, usually of the same
company, in accordance with the terms of the issue.
When, by reason of a declining rate of change in the CPI,
declining interest rates, and/or an increase in the value of
the U.S. dollar, a deflationary cycle is anticipated, the Trust
will invest up to 90% of its total assets in debt instruments
of U.S. or foreign government and government agency fixed-
income securities of sufficient maturities to realize its
objective of long-term capital appreciation. During such
periods, the Trust will hold the balance of its assets in short-
term U.S. or foreign denominated securities.
U.S. Government securities include U.S. Treasury bills,
notes and bonds, which differ in their interest rates,
maturities and times of issuance. Treasury bills have
maturities of one year or less. Treasury notes have maturities
of one to ten years and Treasury bonds have maturities of
greater than ten years at the date of issuance. U.S.
Government securities also include obligations of agencies and
instrumentalities of the U.S. Government. Agencies and
instrumentalities of the U.S. Government include, but are not
limited to: Federal Land Banks; Farmers Home Administration;
Central Bank of Cooperatives; Federal Intermediate Credit
Banks; Federal Home Loan Banks; and Federal National Mortgage
Association. Some obligations of the U.S. Government agencies
and instrumentalities, such as Treasury bills, Government
National Mortgage Association (GNMA) certificates, are
supported by the full faith and credit of the United States;
others, such as securities of Federal Home Loan Banks, are
supported by the right of the issuer to borrow from the U.S.
Treasury; still others, such as bonds issued by the Federal
National Mortgage Association, a private corporation, are
supported only by the credit of the instrumentality. These
securities are not insured by the U.S. Government and there can
be no assurance that the U.S. Government will support an
instrumentality it sponsors. The Trust will invest in the
securities issued by such an instrumentality only when its
Investment Adviser determines that the credit risk with respect
to the instrumentality does not make its securities unsuitable
investments.
GNMA certificates have yield and maturity characteristics
corresponding to the underlying mortgage loans. Thus, unlike
U.S. Treasury bonds, which pay a fixed rate of interest until
maturity when the entire principal amount comes due, payments
on GNMA certificates include both interest and a partial
prepayment of principal. Additional prepayments of principal
may result
from the prepayment, refinancing or foreclosure of the
underlying mortgage loans. Although maturities of the
underlying mortgage loans range up to 30 years, such
prepayments shorten the effective maturities to approximately
12 years (based upon current government statistics). GNMA
certificates currently offer yields higher than those available
from other types of U.S. Government securities, but because of
the prepayment feature may be less effective than other types
of securities as a means of "locking in" attractive long-term
interest rates. This is caused by the need to reinvest
prepayments of principal generally and the possibility of
significant unscheduled prepayments resulting from declines in
mortgage interest rates. As a result, GNMA certificates may
have less potential for capital appreciation during periods of
declining interest rates than other investments of comparable
maturities, while having a comparable risk of decline during
periods of rising interest rates.
There are certain other risks associated with GNMA,
Federal National Mortgage Association (FNMA), and Federal Home
Loan Mortgage Corp. (FHLMC) certificates. Prepayments and
scheduled payments of principal will be reinvested at
prevailing interest rates which may be less than the rate of
interest for the securities on which such payments are made.
When prevailing interest rates rise, the value of each of these
types of securities may decrease as do other debt securities,
but when prevailing interest rates decline, the value of such
securities is not likely to rise on a comparable basis with
other debt securities because of the prepayment feature of each
of these type of securities. If a GNMA, FNMA, or FHLMC
certificate is purchased at a premium above principal because
its fixed rate of interest exceeds the prevailing level of
yields, the premium is not guaranteed and a decline in value to
par may result in a loss of the premium especially in the event
of prepayments.
U.S. Government debt securities of the sort owned by the
Trust fluctuate in market price (but not in ultimate repayment
amount) primarily with interest rate levels and trends, rising
when interest rates decline and declining when interest rates
rise; they generally possess a high degree of dependability
with respect to timely payment of principal or interest.
If, in the opinion of the Investment Adviser, there are
periods when there is a very small rate of change in the
Consumer Price Index, and other leading economic indicators,
such as interest rates and the value of the U.S. dollar, offer
no clear evidence of inflationary or deflationary trends, then,
for temporary defensive purposes, the Trust may invest in short-
term U.S. Government securities and other money market
instruments, cash or cash equivalents. Money market
instruments include highgrade commercial paper (promissory
notes issued by corporations to finance their short-term credit
needs), negotiable certificates of deposit, non-negotiable
fixed time deposits, bankers' acceptances and repurchase
agreements. Investments in commercial paper will be rated
Prime-1 by Moody's Investors Services, Inc. or A-1 by Standard
& Poor's corporation or F-1 by Fitch Investors Service, Inc.,
which are the highest ratings assigned by these agencies.
Money market instruments will be limited to U.S. dollar
denominated instruments which are rated in the top two
categories by an independent nationally recognized rating
organization or, if not rated, are of comparable quality as
determined by the Trustees. Investments in bank instruments
will be in instruments which are issued by U.S. or foreign
banks having capital and undivided surplus at the time of
investment of $200,000,000 or more and which mature in one year
or less from the date of acquisition.
The Investment Adviser believes that, based upon past
performance, the securities of specific companies that hold
different types of substantial resource assets or engage in
resource-related or energy-related activities may move
relatively
independently of one another during different stages of
inflationary or deflationary cycles because of different
degrees of demand for, or market values of, their respective
resource holdings or resource-related or energy-related
business during particular portions of such cycles. For
example, during the period 1976 to 1980, the prices of oil
company stocks increased relatively more than the price of coal
company stocks when compared to the performance of relevant
stock market indices. The Investment Advisor will seek to
identify companies which it
believes are attractively priced relative to the intrinsic
value of the underlying resource assets or resource-related or
energyrelated business or are especially well positioned to
benefit during particular portions of inflationary or
deflationary cycles. The Trust's approach of active investment
management enables it to switch its emphasis among various
industry groups, depending upon the Investment Adviser's
outlook with respect to prevailing trends and developments.
GENERAL RISK CONSIDERATIONS
Because of the following considerations, an investment in
the Trust should not be considered a complete investment
program (additional risk considerations are discussed below).
The Trust concentrates its assets in the global natural
resource industries, and thus should not be considered as a
complete investment program. Because the Trust focuses on this
specific investment area, the price of the Trust's shares may
be more volatile than that of investment companies that do not
concentrate their investments in such a manner. The value of
Trust shares may be susceptible to factors affecting the
natural resource industries. In both the U.S. and foreign
countries, for example, these industries may be subject to
greater political, environmental and other governmental
regulation than other industries.
The nature of such regulation continues to evolve in both
the U.S. and foreign countries, and changes in governmental
policies and the need for regulatory approvals may have a
material effect on the products and services of natural
resource companies. For example, the exploration, development
and distribution of coal, oil and gas in the United States are
subject to significant federal and state regulation, which may
effect rates of return on such investments and the kinds of
services that may be offered.
In addition, many natural resource companies historically
have been subject to significant costs associated with
compliance with environmental and other safety regulations and
changes in the regulatory climate. Such governmental
regulations may also hamper the development of new
technologies, and it is impossible to predict the direction,
type or effect of any future regulation.
Further, competition is intense for many natural resource
companies. As a result, many of these companies may be
adversely affected in the future and the value of the
securities issued by such companies may be subject to increased
share price volatility.
The value of the Trust's securities will fluctuate in
response to stock market developments, as well as market
conditions for the particular natural resource with which the
issuer is involved. The price of the commodity will fluctuate
due to changes in worldwide levels of inventory, and changes,
perceived or actual, in production and consumption. The value
of natural resources may fluctuate directly with respect to
various stages of the inflationary cycle and perceived
inflationary trends and is subject to numerous factors,
including national and international politics. Further, the
Trust's investments in companies are expected to be subject to
irregular fluctuations in earnings, because these companies are
effected by changes in the availability of money, the level of
interest rates, and other
factors.
The success of the Trust's investment program will be
dependent to a high degree on the Investment Adviser's ability
to anticipate the onset and termination of inflationary and
deflationary cycles. A failure to anticipate a deflationary
cycle could result in the Trust's assets being
disproportionately invested in resource-related equity
securities. Conversely, a failure to predict an inflationary
cycle could result in the Trust's assets being
disproportionately invested in U.S. Government securities. The
success of the Trust's investment program will also be
dependent to a high degree on the validity of the premise that
the values of resource-related equity securities will move in a
different direction than the values of U.S. Government
securities during periods of inflation or deflation. If values
of both precious metals and U.S. Government securities move
down during the same period of time, the value of the
shareholder's investment will decline rather than stabilize or
increase, as anticipated, regardless of whether the Trust is
primarily invested in equity securities or U.S. Government
securities.
Investment on an international basis involves certain
risks not involved in domestic investments, including
fluctuations in foreign exchange rates, higher foreign
brokerage costs, costs of currency conversion, currency
blockage, different accounting standards, difficulty in
obtaining foreign court judgments, future political and
economic developments, and the possible imposition of exchange
controls or other foreign governmental laws or restrictions.
Since the Trust may invest in securities denominated or quoted
in currencies other than the U.S. dollar, changes in foreign
currency exchange rates will affect the value of securities in
the portfolio and the unrealized appreciation or depreciation
of investments. In addition, with respect to certain foreign
countries there is the possibility of expropriation and
nationalization of assets, confiscatory taxation, political or
social instability or diplomatic developments which could
affect investments in those countries. Interest and dividends,
and possibly other amounts received by the Trust in respect of
foreign investments, may be subject to withholding and other
taxes at the source, depending upon the laws of the country in
which the investment is made.
SPECIALIZED INVESTMENT TECHNIQUES AND RELATED RISKS
The Trust's investments are subject to the following
techniques and may involve certain risks, which are summarized
below. There can be no assurance that the Trust will attain
its investment objectives.
LENDING OF PORTFOLIO SECURITIES
The Trust may seek to increase its income by lending
portfolio securities in accordance with its secondary
investment objective of generating current income consistent
with the preservation of shareholders' purchasing power. Any
such loan will be continuously secured by collateral at least
equal to the market value of the security loaned. The Trust
would have the right to call a loan and obtain the securities
loaned at any time on five days' notice. During existence of a
loan, the Trust would continue to receive the equivalent of the
interest or dividends paid by the issuer on the securities
loaned and would also receive a fee, or the interest on
investment of the collateral, if any. The total value of the
securities loaned at any time will not be permitted to exceed
30% of the Trust's total assets. As with other extensions of
credit, there are risks of delay in recovery or even loss of
rights in the collateral should the borrower of the securities
fail financially. However, the loans would be made only to U.S.
domestic organizations deemed by the Trust's management to be
earned justifies the attendant risk.
REPURCHASE AGREEMENTS
A repurchase agreement is an agreement under which the
Trust acquires a money market instrument (a security issued by
the U.S. Government or any agency thereof, a banker's
acceptance or a certificate of deposit) from a commercial bank,
subject to resale to the seller at an agreed upon price and
date (normally the next business day). Such an agreement is,
in effect, a loan by the Trust. The resale price reflects an
agreed upon interest rate effective for the period the
instrument is held by the Trust and is unrelated to the
interest rate on the underlying instrument. The Trust will
effect repurchase agreements only with large wellcapitalized
banks whose deposits are insured by the Federal Deposit
Insurance Corporation and which have capital and undivided
surplus of at least $200,000,000. The instrument acquired by
the Trust in these transactions (including accrued interest)
must have a total value in excess of the value of the
repurchase agreement and will be held by the Trust's custodian
bank until repurchased. The Trustees of the Trust will monitor
the Trust's repurchase agreement transactions on a continuous
basis and will require that the applicable collateral will be
retained by the Trust's custodian bank. No more than an
aggregate of 10% of the Trust's total assets, at the time of
investment, will be invested in repurchase agreements maturing
in more than seven days or in any other similarly illiquid
security which is subject to legal or contractual restrictions
on resale or which is not readily marketable. There is no
limitation on the Trust's assets with respect to investments in
repurchase agreements having maturities of less than seven
days.
The use of repurchase agreements involves certain risks.
For example, if the seller under a repurchase agreement
defaults on its obligation to repurchase the underlying
instrument at a time when the value of the instrument has
declined, the Trust may incur a loss upon its disposition. If
the seller becomes insolvent and subject to liquidation or
reorganization under bankruptcy or other laws, a bankruptcy
court may determine that the underlying instrument is
collateral for a loan by the Trust and therefore is subject to
sale by the trustee in bankruptcy. Finally, it is possible that
the Trust may not be able to substantiate its interest in the
underlying instrument. While the Trust's Trustees acknowledge
these risks, it is expected that they can be controlled through
careful monitoring procedures.
PORTFOLIO TURNOVER
Securities will generally be purchased for possible long
term appreciation and not for short-term trading profits;
however, the rate of portfolio turnover is not a limiting
factor when the Investment Adviser deems changes appropriate.
It is anticipated that the Trust's annual portfolio turnover
rate will normally not exceed 50%. A rate of turnover of 100%
could occur, for example, if the value of the lesser of
purchases and sales of portfolio securities for a particular
year equaled the average monthly value of portfolio securities
owned during the year (excluding short-term securities).
A high rate of portfolio turnover involves a
correspondingly greater amount of brokerage commissions and
other costs which must be borne directly by the Trust and thus
indirectly by its shareholders. It may also result in the
realization of larger amounts of short-term capital gains which
are taxable to shareholders as ordinary income.
The portfolio turnover rates for the years, 1995 and
1994 were 33% and 0%, respectively. \R
INVESTMENT RESTRICTIONS
The Trust has adopted the following investment
restrictions which are fundamental policies and cannot be
changed without approval by the holders of a majority of the
outstanding voting securities of the Trust (which in the
Prospectus and this Statement of Additional Information means
the lesser of either (i) a majority of the outstanding shares
of the Trust or (ii) 67%
or more of the shares represented at a meeting if more than 50%
of such shares are present or represented by proxy at the
meeting):
1. The Trust will not purchase any securities (other than
securities of the U.S. Government, its agencies, or
instrumentalities) if as a result more than 5% of the Trust's
total assets (taken at current value) would then be invested in
securities of a single issuer.
2. The Trust will not make loans, except that the Trust
may
(a) purchase a portion of an issue or publicly distributed
bonds, debentures, or similar debt securities (including so-
called "repurchase agreements" whereby the Trust's cash is, in
effect, deposited on a secured basis with a bank for a period
and yields a return; provided, however, that no more than an
aggregate of 10% of the Trust's total assets, immediately after
such investment, will be invested in repurchase agreements
having maturities longer than seven days and other investments
subject to legal or contractual restrictions on resale, or
which are not readily marketable), and (b) lend portfolio
securities upon such conditions as may be imposed from time to
time by the Securities and Exchange Commission, provided that
the value of securities loaned at any time may not exceed 30%
of the Trust's total assets.
3. The Trust will not borrow in excess of 5% of its total
assets, taken at market or other fair value, at the time such
borrowing is made, and any such borrowing may be undertaken
only as a temporary measure for extraordinary or emergency
purposes; and the Trust may not pledge, mortgage, or
hypothecate its assets taken at market to an extent greater
than 15% of the Trust's gross assets taken at cost. The Trust
has no current intention of pledging its assets.
4. The Trust will not purchase any securities if such
purchase would cause more than 10% of the total outstanding
voting securities of such issuer (other than any wholly-owned
subsidiary of the Trust) to be held by the Trust.
5. The purchase or retention of the securities of any
issuer is prohibited if the officers and Trustees of the Trust
or its Investment Adviser owning beneficially more than 1/2 of
1% of the securities of such issuer together own beneficially
more than 5% of the securities of such issuer.
6. The purchase of the securities of any other investment
company is prohibited, except that the Trust may make such a
purchase in the open market involving no commission or profit
to a sponsor or dealer (other than the customary broker's
commission), provided that not more than 10% of the trust's
total assets (taken at market or other fair value) would be
invested in such securities and not more than 3% of the voting
stock of another investment company would be owned by the Trust
immediately after the making of any such investment, and the
Trust may make such a purchase as part of a merger,
consolidation or acquisition of assets. The Trust has no
current intention of investing in other investment companies.
7. The purchase of securities of companies with a record
(including that of their predecessors) of less than three
years' continuous operation is prohibited if such purchase
would cause the Trust's investments in such companies taken at
cost to exceed 5% of the total assets of the Trust taken at
current values, except that this restriction shall not apply to
any of the Trust's investments in any of its wholly-owned
subsidiaries.
8. The Trust will not participate in a joint venture or
on
a joint and several basis in any securities trading account.
9. The Trust will not act as an underwriter of
securities
issued by others, except to the extent it may be deemed such
in connection with the disposition of securities owned by it.
10. The Trust will not make short sales of securities
unless at all times when a short position is open, it owns an
equal amount of such securities or owns securities convertible
into or exchangeable for, without payment of any further
consideration, securities of the same issue as, and at least
equal in amount to, the securities sold short. The Trust has
no current intention of selling securities short.
11. The Trust will not purchase securities on margin, but
may obtain such short-term credits as may be necessary for the
clearance of purchases and sales of securities.
12. The Trust will not make investments in real estate or
indirect interests in real estate.
As a diversified investment company, the Trust is subject
to the following limitations as to 75% of its total assets: (a)
the Trust may not invest more than 5% of its total assets in
the securities of any one issuer, except obligations of the
U.S. Government and its agencies and instrumentalities; (b) the
Trust may not own more than 10% of the outstanding voting
securities of any one issuer.
The policies set forth above are fundamental policies and
may not be changed without shareholder approval.
As a non-fundamental policy, the Trust presently does not
intend to invest directly in: (a) physical commodities or in
other natural resource assets or contracts related to natural
resource assets; (b) option transactions involving portfolio
securities and securities indices; (c) options on foreign
currencies; (d) financial futures and related options. The
Trust presently does not intend to invest directly in natural
resource assets or contracts related to natural resource
assets.
MANAGEMENT
OFFICERS AND TRUSTEES
The Trust's Officers and Trustees, their positions with
the Trust and their principal occupations are listed below.
Except as indicated, each individual has held the office shown
or other offices in the same company, other than the Trust, for
the last five years. Unless otherwise noted, the business
address of each Officer and Trustee is 7022 Bennington Woods
Drive, Pittsburgh, Pennsylvania 15237, which is also the
address of the Trust's Investment Adviser, Anchor Investment
Management Corporation. Those Trustees who are "interested
persons" of the Trust or the Investment Adviser, as defined in
the Investment Company Act of 1940, by virtue of their
affiliation with either the Trust or the Investment Adviser,
are indicated by an asterisk (*).
Positions with Principal
Name and Address the Trust Occupation
DAVID W. C. PUTNAM Chairman Chairman and Trustee,
10 Langley Road and Trustee Anchor Capital Accumulation
Trust,
Newton Centre, MA 02159 Anchor International
Bond
Trust, Anchor
Strategic Assets Trust,
Anchor Resource and Commodity
Trust,and
Anchor
Gold and Currency Trust
(Investment
Companies); President and
Director, F. L. Putnam
Securities Company, Inc.; Chairman and
Director, Boston Security Counsellors, Inc.
(Investment Adviser); Chairman and
Trustee, The Advest Advantage Investment Trusts
(Investment Companies.)
SPENCER H. LE MENAGER Secretary and President,
Equity, Inc.; formerly
222 Wisconsin Avenue Trustee
P. O. Box 390 President, Howe, Barnes &
Johnson
Lake Forest, IL 60045 Inc. (securities
dealer).
^ ^ ^
MAURICE A. DONAHUE Trustee Director and
Professor, Institute for Governmental 50 Holy Family Road
Services and Walsh-Saltonstall Professor of Practical Holyoke,
MA 01040 Politics, University of
Massachusetts, Director Vanguard Savings
Bank Former Member , Massachusetts
House of Representatives, Former Member and
President, Massachusetts Senate. \R
DAVID Y. WILLIAMS* President and President and Director,
Anchor 7022 Bennington Woods Dr. Trustee Investment
Management Corporation;
Pittsburgh, PA 15237 President and Director,
Meeschaert & Co., Inc.
(securities dealer).
J. STEPHEN PUTNAM Vice President President, Robert Thomas
880 Carillon Parkway and Treasurer Securities,
Inc. (securities
P.O. Box 12749 dealer) since June 1983;
Director
St. Petersburg, FL 33733 F. L. Putnam Securities
Company,
Incorporated. Formerly,
President and Director, EPB,
Inc.
and Vice President, Burgess
& Leith Incorporated.
CHRISTOPHER Y. WILLIAMS Vice President Vice
President
and Secretary, Anchor
485 Cherry Court and Asst. Secretary Investment Management
Corporation;
Pittsburgh, PA 15237 Vice President and
Secretary, Meeschaert
& Co., Inc. (securities
dealer)
JOSEPH C. WILLIAMS Vice President Vice President and
Treasurer, Anchor
4594 Bucktail Dr. and Asst. Treasurer
Investment
Management Corporation;
Allison Park, PA 15101 \R Vice President and
Treasurer, Meeschaert
& Co., Inc. (securities
dealer)
The Officers and Trustees of the Trust as a group owned or
had beneficial interests in less than one percent (1%) of those
shares of the Trust outstanding on December 31, 1995. \R
Messrs. Putnam, Le Menager, and Donahue, are the Trustees
who are not "interested persons" (as that term is defined in
the Investment Company Act of 1940) of the Trust. \R
Mr. David W.C. Putnam and Mr. J. Stephen Putnam are brothers.
Mr. David Y. Williams is the father of Mr. Christopher Y.
Williams and Mr. Joseph C. Williams. Mr. Christopher Y.
Williams and Mr. Joseph C. Williams are brothers.
Mr. David W.C. Putnam and Mr. J. Stephen Putnam are brothers.
Mr. David Y. Williams is the father of Mr. Christopher Y.
Williams and Mr. Joseph C. Williams. Mr. Christopher Y.
Williams and Mr. Joseph C. Williams are brothers.
The standing audit committee is composed of Messrs. Le
Menager and, Donahue. The Trust does not have a nominating or
compensation committee. \R
REMUNERATION OF OFFICERS AND TRUSTEES
The Trust will not pay any remuneration to its Officers or
Trustees as such who are "interested persons" (as that term is
defined in the Investment Company Act of 1940) of the Trust or
of any investment advisor or distributor of the Trust but will
pay an annual fee not in excess of $1,000 to each Trustee who
is not such an "interested person".
INVESTMENT ADVISORY CONTRACT
The Trust engages Anchor Investment Management Corporation
as Investment Adviser pursuant to an Investment Advisory
Contract dated December 16, 1994 which was approved on such
date by the Trust's sole shareholder.
The Investment Adviser manages the investments and affairs
of the Trust, subject to the supervision of the Trust's Board
of Trustees. The Investment Adviser furnishes to the Trust
investment advice and assistance, administrative services,
office space, equipment and clerical personnel and investment
advisory, statistical and research facilities. The Trust is
responsible for all its expenses not assumed by the Investment
Adviser under the contract, including, without limitation, the
fees and expenses of the custodian and transfer agents, costs
incurred in determining the Trust's net asset value and keeping
its books; the cost of share certificates; membership dues in
investment company organizations; distribution and brokerage
commissions and fees; fees and expenses of registering its
shares; expenses of reports to shareholders, proxy statements
and other expenses of shareholders' meetings; insurance
premiums, printing and mailing expenses; interest, taxes and
corporate fees; legal and accounting expenses; and fees and
expenses of Trustees not affiliated with the Investment
Adviser. The Trust will also bear expenses incurred in
connection with litigation in which the Trust is a party and
the legal obligation the Trust may have to indemnify its
Officers and Trustees with respect thereto.
The Trust pays the Investment Adviser, as compensation
under the Investment Advisory Contract, a monthly fee at the
rate of .75% per annum of the average daily net assets of the
Trust. This fee is higher than that paid by most other
investment companies. The Investment Adviser received fees of
$109,498, $93,230, and $77,815 for services rendered in 1993,
1994, and 1995, respectively. For each of the Trust's fiscal
years ended December 31, 1992, 1993 and 1994, the Investment
Adviser did not receive any investment advisory fees or other
compensation under the Investment Advisory Contract. \R
The Investment Advisory Contract dated December 16, 1994
will remain in effect until December 16, 1996, but it may be
extended from year to year thereafter if approved at least
annually (a) by the vote of a majority of the outstanding
shares of the Trust or by the Board of Trustees, and in either
case, (b) by a vote of a majority of the Trustees of the Trust
who are not parties to the contract or "interested persons" (as
that term is defined in the Investment Company Act of 1940) of
any such party cast in person at a meeting called for the
purpose. Amendments to the contract require similar approval
by the shareholders and the Trustees who are not "interested
persons" (the "Independent
Trustees"). The contract is terminable at any time without
penalty by the Board of Trustees of the Trust or by vote of a
majority of the Trust's shares on 60 days' written notice or by
the Investment Adviser on 90 days' written notice. The
contract terminates automatically in the event of its
assignment (which includes the transfer of a controlling block
of the stock of the Investment Adviser).
INVESTMENT ADVISER
The Investment Adviser, Anchor Investment Management
Corporation, is located at 7022 Bennington Woods Drive,
Pittsburgh, Pennsylvania 15237. The Trust's principal offices
are also located at this address.
The Investment Adviser and Meeschaert & Co., Inc., the
Trust's principal underwriter (the "Distributor"), are
affiliated through common control with Societe D'Etudes et de
Gestion Financieres Meeschaert, S.A. ("Societe D'Etudes"), one
of France's largest privately-owned investment management
firms, which together are referred to as the "Meeschaert
organization". The Meeschaert organization was established in
Roubaix, France in 1935 by Emile C. Meeschaert, and presently
manages, with full discretion, an aggregate amount of
approximately $1.5 billion for about 8,000 individual (and
institutional) customers, including $250 million in French
mutual funds.
The Investment Adviser's Directors and Officers are as follows:
Luc E. Meeschaert, Chairman; his principal occupation is
serving as Chief Executive Officer of Societe D'Etudes.
David Y. Williams, President and Director; Mr. Williams is
also President and a Trustee of the Trust and President and a
Director of Meeschaert & Co., Inc., the Trust's Distributor.
Paul Jaspard, Vice President; his principal occupation is
serving as President of Global Equity Managers, S.A., 26A Rue
Albert-Premier, L-1015, Luxembourg (Investment Advisor). Mr.
Jaspard has managed other portfolios for the Meeschaert
Organization for more than eighteen years and is the individual
primarily responsible for the day-to-day management of the
Trust's portfolio.
PRINCIPAL HOLDERS OF SECURITIES
As of the date of this Statement of Additional
Information, Ex & Co., as an indirect nominee of Societe
D'Etudes, 23 Rue Drouot, 75009, Paris, France, held of record
100% of the outstanding shares of the Trust. As of the date
hereof, Societe D'Etudes had sole voting and investment power
with respect to all of the outstanding shares of the Trust.
DETERMINATION OF NET ASSET VALUE
The net asset value is determined by the Trust as of 12:00
Noon Eastern Time on each business day on which the New York
Stock Exchange is open for trading or on any day that the Trust
is open, but the New York Stock Exchange is not open for
business, if there occurs an event which might materially
affect the net asset value of the Trust's redeemable shares.
The manner of determination of the net asset value is
briefly as follows: Securities traded on a U.S. national or
other foreign securities exchange are valued at the last sale
price on the primary exchange on which they are listed, of if
there has been no sale that day, at the current bid price.
Other U.S. and foreign securities for which market quotations
are readily available are valued at the known current bid price
believed most nearly to represent current market value. Other
securities (including limited traded securities) and all other
assets of the Trust are valued at fair market value as
determined in good faith by the Trustees of the Trust.
Liabilities are deducted from the total, and the resulting
amount is divided by the number of shares outstanding.
Each day investment securities traded on a national
securities exchange are valued at the noon sales price;
securities traded in the over-the-counter market are valued at
the last sale price as of 12:00 Noon. Gold bullion is valued
at noon based on the New York spot gold price. Gold coins,
foreign currencies, and foreign denominated securities for
which market quotations are readily available are valued at the
known bid price as of 12:00 Noon. Temporary cash investments
are stated at cost. In the absence of a reliable market for a
particular metal, security or currency, an investment therein
will be valued at fair value as determined in good faith by the
Trustees.
SPECIMEN PRICE MAKE-UP SHEET
Cash $ 120,000
Deferred organization expenses 37,730
TOTAL ASSETS 157,730
Less: accrued expenses $ 37,730
NET ASSETS $ 120,000*
$120,000 divided by 12,000 outstanding shares = $10.00 net
asset value per share.
Offering price = net asset value per share, or $10.00.
*See the Balance Sheet of the Trust under "Financial
Statements." DISTRIBUTION OF SHARES
Rule 12-b-1 under the Investment Company Act of 1940
("Rule 12b-1") permits investment companies to use their assets
to bear expenses of distributing their shares if they comply
with various conditions, including adoption of a distribution
plan containing certain provisions set forth in the rule. On
December 16, 1994, such a Plan was approved by the Board of
Trustees, including a majority of the Independent Trustees who
have no direct or indirect financial interest in the Plan or
any agreement related thereto (the "Rule 12b-1 Trustees"). The
Plan is of the type sometimes called a compensation plan.
The Plan is currently not in effect, and will not be
implemented unless and until reapproved by the Trust's
shareholders and Board of Trustees. Accordingly, for the year
ended December 31, 1993, the Trust paid no fees under the Plan
to the Distributor.
In connection with the Plan, Trust shares are offered for
sale at net asset value, and the Trust may pay the Distributor
a commission equal to up to 5% of the price paid to the Trust
for each sale, all or any part of which may be re-allowed by
the Distributor to others (dealers) making such sales. To the
extent that the distribution fee is not paid to such dealers,
the Distributor may use such fee for its expenses of
Distribution of Trust shares. If such fee exceeds its
expenses, the Distributor may realize a profit from these
arrangements. The Plan provides for an aggregate limit on the
amount of all payments pursuant to the Plan equal to .75 of 1%
of the Trust's average daily net assets for any fiscal year.
If, so long as the Plan is in effect, the Distributor's re-
allowances to dealers and other expenses exceed the .75 of 1%
limit in any particular year, it could collect in any future
year such amounts (which do not include interest or other
carrying charges) up to any amount by which amounts paid to it
under the Plan in that year are less than the applicable limit
for the prior year. In such a case it might receive amounts in
excess of its then current expenses.
Whether any expenditure under the Plan is subject to a
state
expense limit will depend upon the nature of the expenditure
and the terms of the state law, regulation or order imposing
the limit. Any expenditure subject to such a limit will be
included in the Trust's total operating expenses for purposes
of determining compliance with the expense limit.
The Plan may be terminated at any time by vote of the Rule
12b-1. Trustees, or by vote of a majority of the outstanding
voting shares of the Trust. Any change in the Plan that would
materially increase the distribution expenses of the Trust
provided for in the Plan requires shareholder approval;
otherwise, the Plan may be amended by the Trustees, including
the Rule 12b-1 Trustees.
If and when the Plan is in effect, the selection and
nomination of candidates for Independent Trustees must be
committed to the discretion of the Independent Trustees.
The total amounts paid by the Trust under the foregoing
arrangements may not currently exceed the maximum limit
specified above, and the amounts and purposes of expenditures
under the Plan must be reported to the Rule 12b-1 Trustees
quarterly. The Rule 12-b1 Trustees may require or approve
changes in the implementation or operation of the Plan, and may
also require that total expenditures by the Trust under the
Plan be kept within limits lower than the maximum amount
currently permitted under the Plan as stated above.
If the limit on expenditures is reached at any given time,
the Distributor intends, although it is not obligated to do so,
to continue to offer shares of the Trust and to continue to pay
others re-allowances and maintenance fees. In such an event,
the Distributor intends that it will seek payment from the
Trust in the amount of its commissions (including re-
allowances) and maintenance fees at such times when the
expenditures limit has not otherwise been reached. The Trust
will have no contractual obligation to pay any portion of such
amounts to the Distributor, and the amount, if any, and the
time and conditions under which the Trust might make such
payment as requested by the Distributor will be solely within
the discretion of the 12b-1 Trustees.
CONTINGENT DEFERRED SALES CHARGE
In conjunction with, but not as part of, the Plan, a
contingent deferred sales charge may be imposed upon certain
redemptions of shares purchased after inception of the plan.
The charge in respect of such redemptions made during the first
four calendar years following purchase of the shares is as
follows: 4% in the year of purchase; 3% in the second year; 2%
in the third year; and 1% in the fourth year. These charges
are not received by the Distributor and will not reduce amounts
paid to the Distributor under the Plan.
HOW TO PURCHASE SHARES
Shares of the Trust may be purchased from the Distributor,
7022 Bennington Woods Drive, Pittsburgh, Pennsylvania 15237.
There is no sales charge or commission payable by the investor
with respect to the purchase of shares. For new shareholders
initiating accounts, the minimum investment is $500, except for
exchanges of securities for Trust shares, where the minimum is
$5,000 (see "How to Exchange Securities for Trust Shares" in
the Prospectus). There is no minimum for shareholders making
additional investments to existing accounts.
An application for use in making an initial investment in
the Trust appears in the back of the Trust's Prospectus. The
applicable price will be the net asset value next determined
after the order is received by the Distributor. (See
"Determination of Net Asset Value".)
The Distributor sells shares to the public as agent for
the trust and is the sole principal underwriter for the Trust
under a Distributor's Contract dated November 23, 1994. The
contract automatically terminates upon assignment (which
includes the transfer of a controlling block of the stock of
the Distributor) by either party. The contract also provides
that it will continue for two years from its date and
thereafter its continuation from year to year will require
approval by a majority of the Trust's shares or by the Board of
Trustees and, in addition to such approval, the approval, by
vote cast in
person, at a meeting called for the purpose, by a majority of
the Independent Trustees. Under the contract, the Distributor
pays expenses of sales literature, including copies of any
prospectus of the Trust delivered to investors, and the Trust
pays for its registration and registration of its shares under
the Federal Securities and Investment Company Acts and state
securities acts and other expenses in which it has a direct
interest.
For the years ended December 31, 1994, December 31,
1993 and December 31, 1992, the Distributor received no sales
commission from the Trust. \R
REDEMPTION, EXCHANGE AND REPURCHASE OF SHARES
Any shareholder will be able to require the Trust to
redeem his shares. In addition, the Trust will maintain a
continuous offer to repurchase its shares. If a shareholder
uses the services of a broker in selling his shares in the over-
thecounter market, the broker may charge a reasonable fee for
his services. Redemptions, exchanges and repurchases will be
made in the following manner:
1. Certificates for shares of the Trust may be mailed or
presented, duly endorsed, with signatures guaranteed in the
manner described below, with a written request that the Trust
redeem the shares, to the Trust's transfer agent, Anchor
Investment Management Corporation, 7022 Bennington Woods Drive,
Pittsburgh, Pennsylvania 15237 or to the Trust. If no
certificate has been issued and shares are held in an Open
Account with the Trust's transfer agent, a written request that
the Trust redeem such shares, accompanied by a separate
assignment form (stock power), duly endorsed, with signatures
guaranteed in the manner described below, may be mailed to
presented as described above. The redemption price will be the
net asset value next determined after the certificates and
request are received.
2. A request for repurchase may be communicated to the
Trust by a shareholder through a broker. The repurchase price
will be the net asset value next determined after the request
is received by the Trust, provided that, if the broker receives
the request before noon and transmits it to the Trust before
1:00 p.m. Eastern Time the same day, the repurchase price will
be the net asset value determined as of 12:00 Noon Eastern Time
that day. If the broker receives the request after noon, the
repurchase price will be the net asset value determined as of
12:00 Noon Eastern Time the following day. If an investor uses
the services of a broker in having his shares repurchased, the
broker may charge a reasonable fee for his services.
Payment for shares redeemed or repurchased will be
delivered within seven days after receipt of the shares, and/or
required documents, duly endorsed. The signature(s) on the
certificate or separate assignment form must be guaranteed by a
commercial bank or trust company or by a member of the New
York, American, Pacific Coast, Boston or Chicago Stock
Exchange. A signature guarantee by a savings bank and loan
association or notarization by a notary public is not
acceptable.
In order to insure proper authorization the transfer
agent may request additional documents such as, but not
restricted to, stock powers, trust instruments, certificates of
death, appointments as executor, certificates of corporate
authority and waiver of tax required in some states from
selling estates before redeeming shares.
Under unusual circumstances, when the Board of Trustees
deems it in the best interest of the Trust's shareholders, the
Trust may make payment for shares repurchased or redeemed in
whole or in part in securities or other assets of the Trust
taken at current values. Such payments are permitted pursuant
to Rule 18f-1 of the Investment Company Act of 1940, provided
that the Trust does not make an election with the Commission
that would irrevocably preclude such payments in kind. The
Trust does not
presently intend to make such an election. Such an election
would require the Trust to redeem with cash at a shareholder's
election in any case where the redemption involves less than
$250,000 (or 1% of the Trust's net assets at the beginning of
each ninety day period during which such redemptions are in
effect, if that amount is less than $250,000). Should payment
be made in securities, the redeeming shareholder may incur
brokerage costs in converting such securities to cash.
The right of redemption may be suspended or the payment
date postponed when the New York Stock Exchange is closed for
other than customary weekend or holiday closings, or when
trading on the New York Stock Exchange is restricted, as
determined by the Securities and Exchange Commission; for any
period when an emergency as defined by rules of the Commission
exists; or during any period when the Commission has, by order,
permitted such suspension. In case of a suspension of the
right of redemption, a shareholder who has tendered a
certificate for redemption or made a request for redemption
through a broker may withdraw his request or certificate or he
will receive payment of the net asset value determined next
after the suspension has been terminated.
A shareholder may receive more or less than he paid for
his shares, depending on the net asset value of the shares at
the time of redemption or repurchase.
DISTRIBUTIONS
The Trust distributes any income dividends and capital
gains distributions in additional shares, or, at the option of
the shareholder, in cash. In accordance with his distribution
option, a shareholder may elect (1) to receive both dividend
and capital gain distributions in additional shares or (2) to
receive dividends in cash and capital gain distributions in
additional shares or (3) to receive both dividends and capital
gain distributions in cash. A shareholder may change his
distribution option at any time by notifying the Transfer Agent
in writing. To be effective with respect to a particular
dividend or distribution, the new distribution option must be
received by the Transfer Agent at least 30 days prior to the
close of the fiscal year. All accounts with a cash dividend
option will be changed to reinvest both dividends and capital
gains automatically upon determination by the Trust's transfer
agent that the address of record for the account is not
current.
Dividends and capital gain distributions received in
shares will be received by the Trust's transfer agent, as agent
for the shareholder, and credited to his Open Account in full
and fractional shares computed at the record date closing net
asset value.
Interest and dividends, and possible other amounts
received by the Trust in respect of foreign investments, may be
subject to withholding and other taxes at the source, depending
upon the laws of the country in which the investment is made.
TAXES
The Trust intends to qualify each year as a regulated
investment company under Subchapter M of the Internal Revenue
Code, as subsequently amended or re-enacted. In order to so
qualify, the Trust must, among other things, (i) derive at
least 90% of its gross income from dividends, interest,
payments with respect to certain securities, loans and gains
from the sale of securities; (ii) derive less than 30% of its
gross income from gains from the sale or other disposition of
securities held for less than three months; (iii) distribute at
least 90% of its dividend, interest and certain other taxable
income each year; (iv) maintain at least 50% of the value of
its total assets in cash, cash items, U.S. Government
securities, securities of other regulated investment companies,
and other securities to the extent that no more than 5% of its
assets are invested in the securities of one issuer and it owns
no more than 10% of the
value of any issuer's voting securities, and (v) have no more
than 25% of its assets invested in the securities (other than
those of the U.S. Government or other regulated investment
companies) of any one issuer or of two or more issuers which
the Trust controls and which are engaged in the same, similar
or related trades and businesses. To the extent the Trust
qualifies for treatment as a regulated investment company, the
Trust will not be subject to Federal income tax on income paid
to its shareholders in the form of dividends or capital gains
distributions.
Dividends paid by the trust will generally not qualify for
the dividends-received deductions for corporations. The Trust
will notify shareholders each year of the amount of dividends
and distributions, including the amount of any distribution of
longterm capital gains.
The Trust will be subject to a nondeductible 4% exercise
tax to the extent that it fails to distribute, with respect to
each calendar year, at least 98% of its ordinary income for
such calendar year and 98% of its capital gain net income for
the oneyear period ending on October 31 of such calendar year.
In addition, to the extent that the Trust fails to distribute
100% of its ordinary and capital gain net income with respect
to any calendar year, the amount of such shortfall is subject
to such tax unless distributed with respect to the following
calendar year. For a distribution to qualify as such with
respect to a calendar year under the foregoing rules, it must
be declared by the Trust before December 31 of the year and
paid by the Trust before the following February 1. Such
distributions will be taxable to taxable shareholders in the
year the distributions are declared rather than the year in
which the distributions are received.
The Trust's foreign investments may be subject to foreign
withholding taxes. The Trust will be entitled to claim a
deduction for such foreign withholding taxes for federal income
tax purposes. However, any such taxes will reduce the income
available for distribution to shareholders.
Under the Interest and Dividend Compliance Act of 1983,
the Trust will be required to withhold and remit to the U.S.
Treasury 20% of the dividends and proceeds of redemptions paid
with respect to any shareholder who fails to furnish the Trust
with a correct taxpayer identification number, who under-
reported dividends or interest income, or who fails to certify
that he or she is not subject to such withholding. An
individual's tax identification number is his or her social
security number.
If, in any taxable year, the Trust fails to qualify as a
regulated investment company, the Trust would be taxed in the
same manner as an ordinary corporation and the distributions to
its shareholders would not be deductible by the Trust in
computing its taxable income. In addition, in the event of
such failure to qualify, the Trust's distributions, to the
extent derived from the Trust's current or accumulated earnings
and profits, would be taxable to its shareholders as ordinary
income dividends, even if those dividends might otherwise have
been considered distributions of capital gains.
PORTFOLIO SECURITY TRANSACTIONS
Decisions to buy and sell portfolio securities for the
Trust are made pursuant to recommendations by the Investment
Adviser. The Trust, through the Investment Adviser, seeks to
execute portfolio security transactions on the most favorable
terms and in the most effective manner possible. In seeking
such execution, the Investment Adviser will use its best
judgment in evaluating the terms of a transaction and will give
consideration to various relevant factors, including without
limitation the size and type of the transaction, the nature and
character of the markets for the security, the confidentiality,
speed and
certainty of effective execution required for the transaction,
the reputation, experience and financial condition of the
brokerdealer and the quality of services rendered by the broker-
dealer in other transactions, and the reasonableness of the
brokerage commission, if any.
It is expected that on frequent occasions, there will be
many broker-dealer firms which will meet the foregoing criteria
for a particular transaction. In selecting among such firms,
the Trust, through the Investment Adviser, may give
consideration to those firms which have sold, or are selling,
shares of the Trust. In addition, the Investment Adviser may
allocate Trust brokerage business on the basis of brokerage and
research services and other information provided by broker-
dealer firms, which may involve the payment of reasonable
brokerage commissions in excess of those chargeable by other
broker-dealer firms for effecting the same transactions. Such
"brokerage and research services" may be used for other of the
Investment Adviser's advisory accounts and all such services
may not be used by the Investment Adviser in managing the
Trust. The term "brokerage and research services" includes
advice as to the value of the securities; the advisability of
investing in, purchasing or selling securities; the
availability of securities, or purchasers or sellers of
securities; furnishing analyses and reports concerning issuers,
industries, securities, economic factors and trends; portfolio
strategy and the performance of accounts; and effecting
securities transactions and performing functions incidental
thereto (such as clearance and settlement).
The policy referred to above of considering sales of
shares of the Trust as one of the factors in the selection of
brokerdealer firms to execute portfolio transactions, subject
to the requirement of seeking best execution, is specifically
permitted by a rule of the National Association of Securities
Dealers, Inc. The rule also provides, however, that no member
firm shall favor or disfavor the distribution of shares of any
particular fund or group of funds on the basis of brokerage
commissions received or expected by such firm from any source.
The Trust and one or more of the other investment
companies or accounts for which the Investment Adviser or its
affiliates render investment advisory services on occasion may
simultaneously be engaged in the purchase or sale of the same
security. In such event the transactions in such security
normally will be averaged as to price and allocated as to
amount among the several clients or accounts in a manner deemed
equitable to all. It is recognized that in some cases this
system could have a detrimental effect on the price or volume
of the security as far as the Trust is concerned. In other
cases, however, it is believed that the ability to participate
in volume transactions will produce better executions for the
Trust.
To the extent consistent with the policy of seeking best
price and execution, a portion of the Trust's portfolio
transactions may be executed through the Distributor,
Meeschaert & Co., Inc., which is an affiliate of the Investment
Adviser. In the event that this occurs, it will be on the
basis of what management believes to be current information as
to rates which are generally competitive with the rates
available from other responsible brokers and the lowest rates,
if any, currently offered by the Distributor.
MISCELLANEOUS INFORMATION
CUSTODIAN, TRANSFER AGENT AND DIVIDEND-PAYING AGENT
All securities, cash and other assets of the Trust are
received, held in custody and delivered or distributed by
Investors Bank & Trust Company, Custodian, 24 Federal Street,
Boston, Massachusetts 02110, provided that in cases where
foreign securities must, as a practical matter, be held abroad,
the Trust's custodian bank and the Trust will make appropriate
arrangements so that such securities may be legally so held
abroad. The Trust's custodian bank does not decide on
purchases or sales of portfolio securities or the making of
distributions. Anchor Investment Management Corporation, 7022
Bennington Woods Drive, Pittsburgh, Pennsylvania 15237, serves
as transfer agent and dividend-paying agent for the Trust.
INDEPENDENT PUBLIC ACCOUNTANTS
For the fiscal year ended December 31, 1993, the Trust
employed Livingston & Haynes, P.C., Two Sun Life Park,
Wellesley Hills, Massachusetts 02181, to certify its financial
statements and to prepare its federal and state income tax
returns.
REGISTRATION STATEMENT
This Statement of Additional Information does not
contain all the information set forth in the Registration
Statement and the exhibits and schedules relating thereto,
which the Trust has filed with, and which are available at the
Securities and Exchange Commission, Washington, DC., under the
Securities Act of 1933, as amended, and the Investment Company
Act of 1940, as amended, to which reference is hereby made.
FINANCIAL STATEMENTS
The financial statements of the Trust appearing in the
Statement of Additional Information have been examined by
Livingston and Haynes, P.C., independent accountants, as set
forth in their report, and are included in reliance upon such
reports given on the authority of said firm as experts in
accounting and auditing. A copy of the Trust's Annual Report
may be obtained without charge by writing Anchor Investment
Management Corporation, 7022 Bennington Woods Drive,
Pittsburgh, Pennsylvania 15237, or by calling Anchor Investment
Management Corporation at (412) 635-7610.
Part C. Other Information.
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Included in Part A:
Selected Per Share Data
and
Ratios for a share outstanding throughout
each period ended December 31, for the ten year
ended December 31, 1995 \R
Included in Part B:
Report of Independent Public Accountants*
Statement of Assets and Liabilities December
31,
1995*\R
Statement of Operations for the year
ended
December 31, 1995*\R
Statement of Changes in Net Assets for the
years
ended December 31, 1995
and December 31, 1994*\R
Schedule of Investments, December 31, 1995*\R
Notes to Financial Statements*
* Included in
Registrant's
annual report to shareholders for December
31, 1995
a copy of which is included as Exhibit 12
and incorporated herein by reference thereto. \R
(b) Exhibits:
Exhibit 11. Consent of Independent Public Accountants.
Exhibit 12. Trust's Annual Reports to Shareholders,
December
31, 1995. \R
Exhibit 17. Power of Attorney, dated April 5, 1996. \R
Item 25. Persons controlled by or under common Control
with
Registrant.
(a) No person controls the Registrant.
(b) The following table sets forth the name, address
and percentage of ownership at March 31, 1996, of each
person who then owned of record 5% or more of any class
of the Registrant's outstanding shares:
Name: Address: Percentage
Ownership:
Bank of New York PO Box 1066 99.98%
Wall Street Station
New York, NY 10268 \R
At March 31, 1996, officers and Trustees of the Registrant
as a group owned less than 1% of the outstanding Common
shares. \R
Item 26. Number of Holders of Securities.
The number of holders of record of securities of
the
Registrant as of March 31, 1996 is as follows:
Title of Class:Number of Holders of Record:
Common Shares 3 \R
Class A Shares 0
Item 27. Indemnification.
No amendment. The information was filed in Item 27
of Amendment No. 1
Item 28. Business and Other connections of Investment Advisor.
The information in the Statement of
Additional Information under the caption of
"Management-Investment Adviser" is hereby incorporated
herein by this reference thereto.
Item 29. Principal Underwriters.
(a) The Distributor currently acts as distributor
for the following investment companies:
Anchor Capital Accumulation Trust
S.E.C. file # 811-00972
Anchor International Bond Trust
S.E.C. file # 811-4644
Anchor Strategic Assets Trust
S.E.C. file # 811-5963
(b) See the answer to Item 21 of Part B, which is
herein
incorporated by this
reference thereto.
Item 30. Location of Accounts and Records.
Persons maintaining physical possession of
accounts,
books, and other documents required to be maintained
by Section 31(a) of the Investment Company Act of 1940
and rules promulgated thereunder include
Registrant's
Secretary, David W.C. Putnam; Registrant's
Investment Advisor, Anchor Investment Management
Corporation; and Registrant's custodian, Investors Bank
& Trust company. The address of the Secretary is 10
Langley Road, Suite 404, Newton Centre, Massachusetts
02159; the address of the investment adviser and the
transfer agent and dividend paying agent is 7022
Bennington Woods Drive, Pittsburgh, Pennsylvania 15237;
and the address of the custodian is Financial Product
Services, 1 Lincoln Plaza, Boston, Massachusetts
02205.
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
(a) Not applicable.
(b) Not applicable.
(c) Registrant hereby undertakes to call a meeting
of shareholders for the purpose of voting on the
question of removal of a Trustee or Trustees when
requested in writing to do so by the holders of
at least 10% of the
Registrant's outstanding shares of common stock and,
in connection with such meeting, to comply with
the
provisions of Section 16(c) of the Investment Company
Act of 1940 relating to shareholder communications.
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
/x/
Pre-Effective Amendment No. /
/
Post-Effective Amendment No. 2 \R
/x/
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940
/x/
Amendment No. 3 \R
/x/
________________________________________
ANCHOR RESOURCE AND COMMODITY TRUST
________________________________________
EXHIBITS
INDEX TO EXHIBITS
Exhibit Number Description of Exhibit
(1) Restated Declaration of Trust, as
amended. (Previously filed as Exhibit 1
to Amendment No. 1)
(2) By-Laws of the Registrant, as
amended. (Previously filed as Exhibit 2
to Amendment No. 1)
(3) Not applicable.
(4) Specimen Certificates representing
Common Shares and Class A Common Shares
of Beneficial Interest of the Registrant.
(Previously filed as Exhibit 4 to
Amendment No. 1)
(5) Investment Advisory Agreement
between the Registrant and Anchor
Investment Management Corporation.
(Previously filed as Exhibit 5 to
Amendment No. 2)
(6) Distributor's Contract between the
Registrant and Meeschaert & Co., Inc.
(Previously filed as Exhibit 6 to
Amendment No. 2)
(7) Not applicable.
(8) Custodian Agreement between the
Registrant and Investors Bank & Trust
Company. (Previously filed as Exhibit 8
to Amendment No. 1)
(9) Transfer Agency and Service
Agreement between the Registrant and
Anchor Investment Management Corporation.
(Previously filed as Exhibit 9 to
Amendment No. 1)
(10) Opinion and Consent of Counsel.
(Previously filed as Exhibit 10 to
Amendment No. 1)
(11) Consent of Independent Public
Accountants.
(12) Trust's Annual Report to
Shareholders,
December 31, 1995. \R
(13) Not applicable.
(14) Not applicable.
(15) Distribution Plan of the Registrant.
(Previously filed as Exhibit 15 to
Amendment No. 1)
(16) Not applicable.
(17) Power of Attorney, dated April 5,
1996.\R
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 the requirements for
effectiveness of this Registration Statement pursuant to
Rule 485(b) 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
Pittsburgh and the Commonwealth of Pennsylvania on the 29nd
day of April, 1996.
ANCHOR RESOURCE AND COMMODITY TRUST
By: ____________________________
__ David Y. Williams,
President
Pursuant to the Securities Act of 1933, this Amendment
to this Registration Statement has been signed below by
the following persons in the capacities and on the date
indicated.
Signature Title Date
* President, Secretary,
a
nd April 19, 1996
David W.C. Putnam Trustee (Principle Executive Officer)
* Treasurer
(Principle
April 19, 1996
J. Stephen Putnam Financial Officer)
*
Trustee
April 19, 1996
Maurice A. Donahue
*
Trustee
April 19, 1996
David Y. Williams
*By:
Peter K. Blume
Attorney-in-Fact April 29,
1996
_______________________________
1This Application and Registration Form is designed for cash
purchases of Trust shares. The procedure for exchange of
securities for Trust shares is described in the Trust
Prospectus.
Wellesley Hills - Boston - Ware
Exhibit 11
Livingston & Haynes, P.C.
Certified Public Accountants
Two Sun Life Park
Wellesley Hills, MA 02181-5693
Tel: (617) 237-3339
Fax: (617) 237-3606
Member AICPA Division for CPA Firms
Private Companies Practice Section
SEC Practice Section
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Registration Statement of
Anchor Resource and Commodity Trust on the amended Form N-lA
our report dated January 12, 1996, appearing in the
prospectus, which is part of such Registration Statement, and
to the reference to us under the captions, "Selected Per
Share Data and Ratios".
Livingston & Haynes P.C.
Wellesley Hills, Massachusetts April 25,1996
ANCHOR
RESOURCE
AND
COMMODITY
TRUST
ANNUAL REPORT
DECEMBER 31, 1995
ASSETS:
Investments at quoted market value (cost
$5,882,912; $6,267,5
see Schedule of Investments, Notes 1, 2, & 5) 14
Cash 1,027,85
4
Dividends and interest receivable 6,716
Total assets 7,302,08
4
LIABILITIES:
Payable for capital shares redeemed 2,970
Accrued expenses and other liabilities (Note 3 14,104
)
Total liabilities 17,074
NET ASSETS:
Capital stock (unlimited shares authorized at
$1.00 par value, 7,144,12
amount paid in on 782,903 shares outstanding) 9
(Note 1)
Accumulated overdistributed net investment (10,203)
income
Accumulated realized loss from security (233,518
transactions, net )
Net unrealized appreciation in value of 384,602
investments (Note 2)
Net assets (equivalent to $9.31 per share,
based on $7,285,0
10
782,903 capital shares outstanding)
POWER OF ATTORNEY
We, the undersigned officers and Trustees of Anchor
Resource and Commodity Trust, hereby severally constitute
David W.C. Putnam, David Y. Williams, and Peter K. Blume,
and each of them singly, our true and lawful attorneys, with
full power to them and each of them singly to sign for us,
and in our names and in the capacity mentioned below, any
and all Registration Statements and/or Amendments to the
Registration Statements, filed with the Securities and
Exchange Commission, hereby ratifying and confirming our
signatures as they may be signed by our said attorneys to
any and all amendments to said Registration Statement, and
all additional Registration Statements and Amendments
thereto.
Witness our hands and common seal on the dates set
forth below*
Signature
Title Date
David W.C. Putnam
Chairman and Trustee April 19, 1995
David W.C. Putnam
J. Stephen Putnam
Treasurer (Principle April 19, 1995
J. Stephen Putnam
Financial Officer)
Spencer H. LeMenager
Secretary and Trustee April 19, 1995
Spencer H. LeMenager
Maurice A. Donahue
Trustee April 19,
1995
Maurice A. Donahue
David Y. Williams
President and Trustee April 19, 1995
David Y. Williams
* This Power of Attorney may be executed in several
counterparts, each of which shall be regarded as an original
and all of which taken together shall constitute one and the
same Power of Attorney, and any of the parties hereto may
execute this Power of Attorney by signing any such
counterpart.
