1933 Act File No.
1940 Act File No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933...... X
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Pre-Effective Amendment No. ............................ ____
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and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
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Amendment No. ____ ........................................... _
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GREAT PLAINS FUNDS
(Exact name of Registrant as Specified in Charter)
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
Victor R. Siclari, Esq., Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering
As soon as possible after the effectiveness of the Registration Statement
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Pursuant to the provisions of Rule 24f-2 of the Investment Company Act of 1940,
Registrant hereby elects to register an indefinite number of shares.
Amendment Pursuant to Rule 473
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission acting pursuant to said Section 8(a),
may determine.
Copies To:
Cameron S. Avery, Esquire
Bell, Boyd & Lloyd
3 First National Plaza
70 West Madison St.
Chicago, IL 60602
<PAGE>
CROSS-REFERENCE SHEET
This Registration Statement of the Great Plains Funds, which consists
of five portfolios, (1) Great Plains Equity Fund; (2) Great Plains International
Equity Fund;(3) Great Plains Premier Fund; (4) Great Plains Intermediate Bond
Fund; and (5) Great Plains Tax-Free Bond Fund, is comprised of the following:
PART A. INFORMATION REQUIRED IN A PROSPECTUS.
Prospectus Heading
(Rule 404(c) Cross Reference)
Item 1. Cover Page....................(1-5)Cover Page.
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Item 2. Synopsis......................(1-5)Summary of Fund Expenses.
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Item 3. Condensed Financial
Information (1-5) Performance Information;
Item 4. General Description of
Registrant...................(1-5) Synopsis; (1-5) Fund
Objective and Policies; (1-5)
Portfolio Investments and
Strategies.
Item 5. Management of the Fund........(1-5) Great Plains Funds
Information; (1-5) Management
of the Trust; (1-5) Brokerage
Transactions; (1-5) Distribution
of Fund Shares; (1-5) Shareholder
Servicing
----------------------
Arrangements; (1-5) Administrative
Arrangements; (1-5) Administration
of the Trust; (1-5) Administrative
Services; (1-5) Expenses of the
Funds; (1-5) Distribution
Plan.
Item 6. Capital Stock and Other
Securities...................(1-5) Dividends
and Capital Gains;
(1-5) Certificates
and Confirmations;
(1-5) Shareholder
Information; (1-5)
Voting Rights;
(1-5) Effect of
Banking Laws;
(1-5) Tax
Information; (1-5)
Federal Income
Tax; (1-5) State
and Local Taxes;
(5) Nebraska
Taxes.
Item 7. Purchase of Securities Being
Offered......................(1-5) Net Asset Value; (1-5)
Investing in the Funds; (1-5)
Share Purchases; (1-5) Minimum
Investment Required; (1-5)
What Shares Cost; (1-5)
Reducing the Sales
-------
Charge; (1-5) Sales Charge
Waivers; (1-5) Systematic
Investment Program;
(1-5) Exchange Privilege.
Item 8. Redemption or Repurchase......(1-5) Redeeming Shares; (1-5) By
Telephone; (1-5) By Mail;(1-5)
Systematic Withdrawal; (1-5)
Accounts with Low Balances.
------------------------
Item 9. Pending Legal Proceedings None.
<PAGE>
PART B. INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION.
Item 10. Cover Page......................(1-5) Cover Page.
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Item 11. Table of Contents (1-5) Table of Contents.
Item 12. General Information and
History (1-5) Banking Laws.
Item 13. Investment Objectives and
Policies.......................(1-5) Policies and Acceptable
Investments; (1-5) Investment
Limitations; (5) Nebraska
Investment Risks.
Item 14. Management of the Fund..........(1-5) Great Plains Funds
Management; (1-5) Trustees'
Compensation.
----------------------
Item 15. Control Persons and
Principal Holders of
Securities Not applicable.
Item 16. Investment Advisory and
Other Services.................(1-5) Investment Advisory
Services; (1-5) Shareholder
Servicing Arrangements; (1-5)
Other Services.
Item 17. Brokerage Allocation............(1-5) Brokerage Transactions.
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Item 18. Capital Stock and Other
Securities Not applicable.
Item 19. Purchase, Redemption and Pricing
of Securities Being Offered................(1-5) Distribution
Plan and Agreement;
(1-5) Determining
Market Value; (1-5)
Redemption in Kind.
---------------------------
Item 20. Tax Status..................................(1-5) Tax Status;
(1-5) Massachusetts
Partnership Law;.
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Item 21. Underwriters................................Not applicable.
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Item 22. Calculation of Performance
Data..............................(1-5) Total Return;(1-5)
Yield; (5) Tax-Equivalent
Yield; (1-5) Performance
Comparisons;
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Item 23. Financial Statements...............(1-5) To be filed by
Amendment.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with
the Securities and Exchange Commission. These securities may not be sold
nor may any offers to buy be accepted prior to the time that the
registration statement becomes effective. This Prospectus shall not
constitute an offer to sell or the solicitation of an offer to buy nor
shall there be any sale of these securities in any State in which such
offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such State.
SUBJECT TO COMPLETION July 11, 1997
Great Plains Funds
Great Plains Funds (the "Trust") is an open-end, management investment company
(a mutual fund). The Trust has the following five separate investment portfolios
or mutual funds (each portfolio individually referred to as a "Fund" and
collectively as the "Funds"). Each Fund offers its own shares and has a distinct
investment goal to meet specific investor needs.
Great Plains Equity Fund
Great Plains International Equity Fund
Great Plains Premier Fund
Great Plains Intermediate Bond Fund
Great Plains Tax-Free Bond Fund
This prospectus contains the information you should read and know before you
invest in any of the Funds. Keep this prospectus for future reference.
The shares offered by this prospectus are not deposits or obligations of, or
endorsed or guaranteed by First Commerce Bancshares, Inc., National Bank of
Commerce, or any of their other banking subsidiaries or affiliates, and the
shares are not insured by the Federal Deposit Insurance Corporation, the Federal
Reserve Board, or any other government agency. Investment in these shares
involves investment risks including the possible loss of principal.
The Trust has also filed a Statement of Additional Information dated
_______________, 1997, with the Securities and Exchange Commission ("SEC"). The
information contained in the Statement of Additional Information (together with
any supplement thereto) is incorporated by reference into this prospectus. You
may request a copy of the Statement of Additional Information, or a paper copy
of this prospectus if you have received your prospectus electronically, free of
charge, obtain other information, or make inquiries about the Funds by writing
to the Fund or calling _________________. The Statement of Additional
Information, material incorporated by reference into this document, and other
information regarding the Funds is maintained electronically with the SEC at its
Internet Web site (http://www.sec.gov).
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
Prospectus
________________, 1997
<PAGE>
Table of Contents
(TO BE ADDED)
<PAGE>
<TABLE>
<CAPTION>
Summary of Fund Expenses
Equity International Premier Intermediate Tax-Free
Fund Equity Fund Bond Bond
Fund Fund Fund
---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Shareholder Transaction Expenses
Maximum Sales Load Imposed on Purchases 3.00% 3.00% 3.00% 3.00% 3.00%
(as a percentage of offering price)
Maximum Sales Load Imposed on Reinvested Dividends None None None None None
(as a percentage of offering price)
Contingent Deferred Sales Charge (as a percentage None None None None None
of original purchase price or redemption proceeds,
as applicable)
Redemption Fees (as a percentage of amount redeemed, None None None None None
if applicable)
Exchange Fee None None None None None
Annual Fund Operating Expenses
(As a percentage of average net assets)
Management Fee (after waiver, if applicable) 0.75% 1.25% 0.80% 0.50% 0.50%
(1).......................
12b-1 Fees None None None None None
(2).....................................................................................
Other Expenses (after waivers, if 0.28% 0.41% 0.59% 0.30% 0.38%
applicable)(3)..........................
Shareholder Servicing Agent None None None None None
Fee(2)...........................................
Total Fund Operating Expenses (after waivers, 1.03% 1.66% 1.39% 0.80% 0.88%
if applicable)
(4)......................................................................
</TABLE>
(1) The estimated management fee for the Premier Fund has been reduced to
reflect the anticipated voluntary waiver by the investment adviser. The adviser
can terminate this voluntary waiver at any time at its sole discretion. The
maximum management fee is 1.00%
(2) A 12b-1 fee and shareholder servicing fee exists, however, the Funds have no
intention of accruing or paying these fees for the fiscal year ending August 31,
1998. If a 12b-1 fee were charged, long-term shareholders may pay more than the
economic equivalent of the maximum front end sales charges permitted by the
National Association of Securities Dealers, Inc.
(3) Other expenses are estimated to be 0.56% for the International Equity Fund,
1.04% for the Premier Fund, 0.31% for the Intermediate Bond Fund, and 0.42% for
the Tax-Free Bond Fund, absent the anticipated voluntary waivers by the
administrator and portfolio accountant.
(4) The Total Fund Operating Expenses are estimated to be 1.81% for the
International Equity Fund, 2.04% for the Premier Fund, 0.81% for the
Intermediate Bond Fund, and 0.92% for the Tax-Free Bond Fund, absent the
voluntary waivers described above in Notes 1 and 3.
The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder of the Funds will bear either directly or
indirectly. For more complete descriptions of the various costs and expenses,
see "Great Plains Funds Information," "Administration of the Trust" and
"Investing in the Funds."
EXAMPLE
You would pay the following expenses on a $1,000 investment assuming (1) 5%
annual return; (2) redemption at the end of each time period; and (3)payment of
the maximum sales load. As noted in the table above, the Fund charges no
redemption fees.
Equity Premier Tax-Free
Fund International Fund Intermediate Bond
Equity Bond Fund
Fund Fund
----------------------------------------------------------------
1 $40 $46 $44 $38 $39
Year....................................................
3 $62 $81 $73 $55 $57
Years..................................................
The above example should not be considered a representation of past or
future expenses. Actual expenses may be greater or less than those shown. This
example is based on estimated data for the fiscal year ending August 31, 1998.
<PAGE>
Synopsis
The Trust was established as a Massachusetts business trust under a Declaration
of Trust dated July ________, 1997. The Declaration of Trust permits the Trust
to offer separate series of shares of beneficial interest representing interests
in separate portfolios of securities. The shares in any one portfolio or Fund
may be offered in separate classes. The Funds are designed for individuals and
institutions as a convenient means of participating in professionally managed
Funds. First Commerce Investors, Inc. serves as investment adviser (the
"Adviser") to the Funds. The Adviser is a subsidiary of First Commerce
Bancshares, Inc. Peter A. Kinney serves as sub-adviser (the "Sub-Adviser") to
the Great Plains Equity Fund and Great Plains International Equity Fund.
As of the date of this prospectus, the Trust is comprised of the following five
Funds:
o Great Plains Equity Fund ("Equity Fund")--seeks total return
(current income and capital appreciation) over the long-term by
investing in a non-diversified portfolio of securities consisting
primarily of domestic and foreign common and preferred stocks
selected on the basis of a value approach to investing. The foreign
securities investments may be pursued directly or indirectly through
an investment in the Great Plains International Equity Fund;
o Great Plains International Equity Fund ("International Equity
Fund")--seeks total return (current income and capital appreciation)
over the long-term by investing in a non-diversified portfolio of
securities consisting primarily of equity securities of non-U.S.
issuers selected on the basis of a value approach to investing;
o Great Plains Premier Fund ("Premier Fund")--seeks total return
(current income and capital appreciation) over the long-term by
investing in a non-diversified portfolio of securities consisting
primarily of domestic and foreign common and preferred stocks issued
by companies whose market capitalizations at the time of investment
are under $1 billion, selected on the basis of a value approach to
investing;
o Great Plains Intermediate Bond Fund ("Intermediate Bond
Fund")--seeks total return (current income and capital appreciation)
by investing in a diversified portfolio of securities consisting
primarily of intermediate-term bonds and notes; and
o Great Plains Tax-Free Bond Fund ("Tax-Free Bond Fund")--as a primary
objective, seeks current income exempt from federal regular income
tax and, as a secondary objective, seeks current income exempt from
personal income taxes imposed by the State of Nebraska by investing
in a non-diversified portfolio of municipal securities that generate
such income. The Tax-Free Bond Fund is designed to offer Nebraska
residents the additional advantage of state (as well as federal)
tax-free income to the extent it can purchase suitable tax-free
Nebraska municipal securities. However, because of the Fund's
tax-free nature, it may not be a suitable investment for retirement
plans.
Although certain of the Funds have been designated non-diversified under the
Investment Company Act of 1940, all of the Funds will comply with the
diversification requirements of Subchapter M of the Internal Revenue Code. See
"Portfolio Investments and Strategies--Additional Investment
Risks--Non-Diversification."
For information on how to purchase shares of any of the Funds, please refer to
"Investing in the Funds." A minimum initial investment of $1,000 is required for
each Fund. Subsequent investments in each Fund must be in amounts of at least
$100. Fund shares may be purchased for Individual Retirement Accounts ("IRA's")
with a minimum initial investment of $500, and subsequent investments of at
least $50. Shares of each Fund are sold at net asset value plus any applicable
sales charge, and are redeemed at net asset value. Information on redeeming
shares may be found under "Redeeming Shares."
Risk Factors
Investors should be aware of the following general considerations relating to
the types of investments of one or more of the Funds. The market value of
fixed-income securities may vary inversely in response to changes in prevailing
interest rates. Domestic equity securities are subject to the volatility and
unpredictability of the U.S. stock market. The securities of smaller-capitalized
companies present special risks in that such securities have historically been
more volatile than stocks of larger companies. Foreign securities are subject to
certain risks (i.e., greater price volatility and illiquidity than U.S. equity
securities; greater political, legal and economic risks; currency exchange
fluctuations; different regulatory schemes with less publicly available
information) in addition to those inherent in U.S. investments. High yield
securities are typically subject to greater market fluctuations than investment
grade bonds. Asset-backed and mortgage-backed securities are subject to higher
prepayment risks than other types of debt instruments. The Tax-Free Bond Fund
emphasizes investments in Nebraska municipal securities, which makes it more
susceptible to factors affecting that state. The Funds may make other
investments and employ certain investment techniques that involve other risks,
including lending portfolio securities and entering into futures contracts and
related options as hedges. For a description of these investments, strategies
and other risks, please see "Investment Objective and Policies of Each Fund,"
"Portfolio Investments and Strategies," and "Additional Investment Risks."
<PAGE>
Fund Objective and Policies
The investment objective and policies of each Fund appear below. The investment
objective of a Fund may be changed by the Board of Trustees ("Trustees") without
shareholder approval. However, shareholders of a Fund will be notified before
any change is made to a Fund's investment objective. While a Fund cannot assure
that it will achieve its investment objective, it attempts to do so by following
the investment policies described below.
Unless indicated otherwise, the investment policies of a Fund may be changed by
the Trustees without shareholder approval. However, shareholders will be
notified before any material change in these policies becomes effective.
Additional information about investments, investment limitations and strategies,
and certain investment policies appears in the "Portfolio Investments and
Strategies" section of this Prospectus and in the Statement of Additional
Information.
Great Plains Equity Fund
The investment objective of the Equity Fund is to achieve total return
(consisting of current income and capital appreciation) over the long-term. The
Fund pursues this objective through the application of a value-oriented approach
by investing primarily in a portfolio of common and preferred stocks of domestic
and foreign issuers as well as domestic and foreign securities convertible into
common and preferred stocks. Under normal market conditions, the Fund intends to
invest at least 65% of its total assets in these equity securities. The issuers
of these securities will consist primarily of medium to large capitalization
domestic and foreign companies. As described under the "Portfolio Investments
and Strategies--Securities of Other Investment Companies" section of this
Prospectus, the Equity Fund may seek its foreign securities component by
purchasing shares of the International Equity Fund. Accordingly, investors in
the Equity Fund should also review the description of the International Equity
Fund's investment objective and strategies as well as the list below of
Acceptable Investments.
Great Plains International Equity Fund
The investment objective of the International Equity Fund is to seek total
return (consisting of current income and capital appreciation) over the
long-term. Under normal market conditions, at least 65% of the Fund's total
assets will be invested in equity securities of issuers domiciled in at least
three different nations outside the United States. The Fund's foreign
investments will emphasize primarily Western European countries and secondarily
Asia and Latin America, and emphasize developed over emerging markets. However,
the Fund reserves the investment discretion to invest in other countries and
regions, subject to its 65% investment policy noted above. The Fund may also
invest up to 35% of its total assets in foreign and domestic debt securities,
warrants or rights to subscribe to or purchase equity securities, or debt
securities convertible into common or preferred stocks when, in the judgment of
the Fund's Adviser, such investments are consistent with the Fund's objective of
total return. Certain debt securities can provide the potential for capital
appreciation in addition to current income based on various factors such as
changes in interest rates, economic and market conditions, improvement in an
issuer's ability to repay principal and pay interest, and ratings upgrades. The
Fund may invest in foreign and domestic debt or preferred securities which have
equity features, such as conversion or exchange rights, or which carry warrants
to purchase common stock or other equity interests. Such equity features enable
the holder of the bond or preferred security to benefit from increases in the
market price of the underlying equity security. In selecting securities, the
Fund's Adviser uses a value-oriented approach to investing and attempts to
identify those companies in various countries and industries where economic and
political factors, including currency movements, are likely to produce
above-average opportunities for capital appreciation.
Great Plains Premier Fund
The investment objective of the Premier Fund is to seek total return (consisting
of current income and capital appreciation) over the long-term. The Fund will
pursue this objective through the application of a value-oriented approach by
investing primarily in a portfolio of common and preferred stocks of domestic
and foreign issuers as well as domestic and foreign securities convertible into
common and preferred stocks. Under normal market conditions, at least 65% of its
total assets will be invested in common and preferred stocks issued by companies
whose market capitalizations at the time of investment are under $1 billion
(which includes small capitalization stocks). As an operational policy, this
Fund intends to limit its foreign investments to 35% of its total assets. As
described under the "Portfolio Investments and Strategies--Securities of Other
Investment Companies" section of this Prospectus, the Premier Fund reserves the
option of seeking its foreign securities component by purchasing shares of the
International Equity Fund, although it presently intends to purchase foreign
securities directly. Accordingly, investors in the Premier Fund should also
review the description of the International Equity Fund's investment objective
and strategies, as well as the list below of Acceptable Investments.
<PAGE>
The Stock Funds' Acceptable Investments. The Equity Fund, International Equity
Fund and Premier Fund will sometimes collectively be referred to as the "Stock
Funds." The Stock Funds share the same value approach to investing. Subject to
their investment strategies described above, these Funds seek high quality
domestic and/or international companies that, in the opinion of the Adviser,
combine the qualitative and quantitative characteristics of companies with
compelling valuation levels, and offer significant investment potential.
Attractive company qualities include, but are not limited to: proven management,
businesses with identifiable franchises, earnings and shareholder growth
potential, increasing market share, cash flow which is intelligently reinvested,
high return on equity and assets, low debt, and operating margins which are high
or improving. In the Adviser's opinion, compelling valuations can be observed
by: asset values of businesses; low price/earnings, price/cash flow, and
price/sales ratios relative to growth potential; and attractive discounted
future valuation models. The Stock Funds may invest in the same types of
acceptable investments which include the following and are described in more
detail below under the "Portfolio Investments and Strategies" section of this
prospectus:
o common and preferred stocks of domestic (U.S.) companies that are
listed on the New York or American Stock Exchange, or other domestic
exchange, or traded in over-the-counter markets;
o common and preferred stocks of foreign companies;
o convertible securities of domestic and foreign issuers that are
rated in the top two categories by a nationally recognized
statistical rating organization ("NRSRO") such as AA or better by
Standard & Poor's ("S&P") or Fitch Investors Service, Inc.
("Fitch"), or Aa or better by Moody's Investors Services, Inc.
("Moody's") or, if unrated, are of comparable quality as determined
by the Fund's Adviser;
o U.S. government securities;
o debt obligations (including bonds, notes and debentures) issued
by U.S. or foreign corporations and governments that are rated in
the top two categories by an NRSRO (such as AA or better by S&P or
Fitch, or Aa or better by Moody's) or, if unrated, are of
comparable quality as determined by the Fund's Adviser;
o American Depositary Receipts ("ADRs"), Global Depositary Receipts
("GDRs") and European Depositary Receipts ("EDRs") (collectively,
"Depositary Receipts");
o foreign currency transactions (including forward currency exchange
contracts, currency futures contracts, and options on currency and currency
futures contracts);
o Prime Commercial Paper;
o foreign and domestic Bank Instruments;
o warrants;
o repurchase agreements; and
o securities of other investment companies.
For additional information on other investment techniques and strategies of the
Stock Funds, see the "Portfolio Investments and Strategies" section of this
Prospectus.
Great Plains Intermediate Bond Fund
The investment objective of the Intermediate Bond Fund is to seek total return
(consisting of current income and capital appreciation). The Fund pursues this
objective by investing primarily in a diversified portfolio of investment grade
intermediate-term bonds and notes with an average dollar-weighted maturity of
three to ten years. The Fund will invest, under normal circumstances, at least
65% of the value of its total assets in bonds. For purposes of this investment
policy, "bonds" shall include all permitted types of debt instruments, including
debt held as collateral for repurchase agreements. Investment grade debt
obligations are rated in the top four categories by an NRSRO (such as BBB or
better by S&P or Fitch, or Baa or better by Moody's), or if unrated, are of
comparable quality as determined by the Adviser. See "Ratings" in the "Portfolio
Investments and Strategies" section of this Prospectus. The Fund reserves the
right to invest up to 35% (although it intends to operate with not more than
15%) of its total assets in debt obligations rated below investment grade but
not lower than BB by S&P or Fitch or Ba by Moody's, or which are of comparable
quality. Such debt obligations are sometimes referred to as high-yield debt
obligations or "junk bonds." For a description of these types of securities and
the additional risks associated with them, see "High-Yield Debt Obligations" in
the "Portfolio Investments and Strategies" section of this Prospectus.
The Intermediate Bond Fund's Acceptable Investments. Acceptable investments
include the following and are described in more detail below under the
"Portfolio Investments and Strategies" section of this Prospectus:
o domestic and foreign issues of corporate debt obligations (including
bonds, notes and debentures);
o U.S. government securities;
o convertible securities and debentures;
o Prime Commercial Paper;
o domestic Bank Instruments;
o Mortgage-Backed Securities;
o Asset-Backed Securities;
o Zero Coupon Obligations;
o taxable Municipal Securities;
o repurchase agreements; and
o securities of other investment companies.
For additional information on other investment techniques and strategies of the
Fund, see the "Portfolio Investments and Strategies" section of this Prospectus.
Great Plains Tax-Free Bond Fund
The primary investment objective of the Tax-Free Bond Fund is to seek current
income that is exempt from federal regular income tax. As a secondary investment
objective, the Fund seeks current income that is also exempt from the regular
income taxes imposed by the State of Nebraska. As an operational policy and not
an investment policy, the Fund will seek to maintain an average dollar-weighted
portfolio maturity of five to fifteen years.
The Tax-Free Bond Fund's Acceptable Investments. The Tax-Free Bond Fund pursues
its objective by investing in a non-diversified portfolio of debt obligations
issued by or on behalf of any state, territory or possession of the United
States, including the District of Columbia, or any of their political
subdivisions or financing authorities ("Municipal Securities"), with a portion
of the portfolio consisting of Municipal Securities issued by or on behalf of
the State of Nebraska, its political subdivisions or agencies ("Nebraska
Municipal Securities"). As a fundamental investment policy that cannot be
changed without shareholder approval, under normal market conditions, at least
80% of the Tax-Free Bond Fund's net assets will be invested in Municipal
Securities, the income from which is exempt from federal income tax (including
the federal alternative minimum tax). Interest income of the Tax-Free Bond Fund
that is exempt from federal income tax and the Nebraska state personal income
tax retains its tax-free status when distributed to shareholders. The Fund's
acceptable investments include the following and are described in more detail
below under the "Portfolio Investments and Strategies" section of this
Prospectus:
o investment grade Municipal Securities (rated in the top four categories
by an NRSRO such as BBB by S&P or Fitch, or Baa by Moody's or, if unrated, of
comparable quality as determined by the Fund's Adviser); and
o securities of other investment companies that have a similar
objective of tax-free income.
For additional information on the other investment techniques and strategies of
the Fund, see the "Portfolio Investments and Strategies" section of this
Prospectus. For investment risks associated with investments in Nebraska
Municipal Securities, see "Additional Investment Risks--Municipal Securities"
under the "Portfolio Investments and Strategies" section of the Prospectus.
Net Asset Value
The Funds' net asset value per share fluctuates. The net asset value per
share is determined by dividing the sum of the market value of all securities
and all other assets, less liabilities, by the number of shares outstanding.
The net asset value is determined as of the close of trading on the New York
Stock Exchange (normally 3:00 p.m., Central time), Monday through Friday, except
on: (i) days on which there are not sufficient changes in the value of a Fund's
portfolio securities that its net asset value might be materially affected; (ii)
days during which no shares are tendered for redemption and no orders to
purchase shares are received; or (iii) the following holidays: New Year's Day,
Martin Luther King Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Columbus Day, Veterans' Day, Thanksgiving Day, and Christmas
Day.
Investing in the Funds
Share Purchases
Fund shares are sold on days on which the New York Stock Exchange and the
Federal Reserve Wire System are open for business. Fund shares may be purchased
through National Bank of Commerce ("NBC") in connection with qualified trust
accounts, through authorized broker/dealers, or directly from the Fund. In
connection with the sale of Fund shares, Edgewood Services, Inc. (the
"Distributor") may, from time to time, offer certain items of nominal value to
any shareholder or investor. Each Fund reserves the right to reject any purchase
request.
By Telephone. To place an order to purchase shares of the Funds, individual
investors should call Great Plains Funds Shareholder Services at
1-800-___________. The order must be placed before the close of regular trading
session on the New York Stock Exchange. (normally 3:00 p.m Central time) for
shares to be purchased at that day's price; payment is expected the next
business day, but must be received by the Fund within three business days of
placing the order.
Payment by Wire. To purchase shares by Federal Reserve Wire, trust customers
should contact their account officer. All other customers should call Great
Plains Funds Shareholder Services at 1-800- _____________. Wire orders will only
be accepted on days on which the Funds, NBC and the Federal Reserve Banks are
open for business.
By Mail. To purchase shares of the Funds by mail, investors may send an
application (for a new account) and a check made payable to the particular Fund
to: Great Plains Funds Shareholder Services, ------------------------.
Orders by mail are considered received after payment by check is converted into
federal funds. This is normally the next business day after Federated
Shareholder Services Company receives the check.
Minimum Investment Required
The minimum initial investment in the Funds is $1,000. Subsequent investments in
each Fund may be in amounts of $100 or more. The minimum initial investment in
the Funds for investors purchasing through an IRA account is $500; subsequent
investments may be in amounts of $50 or more. The Funds reserve the right to
waive or reduce investment minimums from time to time.
Exchanging Securities For Fund Shares
The Funds may accept securities in exchange for Fund shares. A Fund will
allow such exchanges only upon prior approval of a Fund and a determination by a
Fund and the Adviser that the securities to be exchanged are acceptable.
Any securities exchanged must meet the investment objective and policies of
a Fund and, must have a readily ascertainable market value. The market value of
any securities exchanged in an initial investment, plus any cash, must be at
least $25,000.
Securities accepted by a Fund will be valued in the same manner as a Fund
values its assets. The basis of the exchange will depend upon the net asset
value of Fund shares on the day the securities are valued. One share of a Fund
will be issued for each equivalent amount of securities accepted.
Any interest earned on the securities prior to the exchange will be
considered in valuing the securities. All interest, dividends, subscription or
other rights attached to the securities become the property of a Fund, along
with the securities.
What Shares Cost
Shares of the Funds are sold at their net asset value next determined after an
order is received, plus a sales charge as follows:
<TABLE>
<CAPTION>
Sales Charge
Sales Charge as % of Dealer Allowance
Amount of as % of Net Amount as % of
Transaction Offering Price Invested Offering Price
<S> <C> <C> <C> <C>
Less than $100,000 3.00% 3.09% 2.55%
$100,000 but less than $250,000 2.50% 2.56% 2.12%
$250,000 but less than $500,000 2.00% 2.04% 1.70%
$500,000 but less than $1,000,000 1.50% 1.52% 1.27%
$1,000,000 or more 0.00% 0.00% 0.00%
</TABLE>
As described below, the sales charge may be waived or reduced for certain
investors and transactions.
Dealer Allowance. For sales of shares of the Funds, any authorized dealer will
normally receive up to 85% of the applicable sales charge. Any portion of the
sales charge which is not paid to authorized dealers will be retained by the
Distributor. The Distributor may, periodically, uniformly offer to pay
additional amounts in the form of cash or promotional incentives consisting of
trips to sales seminars at luxury resorts, tickets or other such items, to all
dealers selling shares of the Funds. Such payments, all or a portion of which
may be paid from the sales charge it normally retains or any other source
available to it, will be predicated upon the amount of shares of the Funds that
are sold by the dealer.
The sales charge for shares sold other than through authorized dealers will be
retained by the Distributor. The Distributor may pay fees to financial
institutions out of the sales charge in exchange for sales and/or administrative
services performed on behalf of the financial institution's customers in
connection with the initiation of customer accounts and purchases of a Fund's
shares.
Sales Charge Waivers
Purchases at Net Asset Value. Shares of the Funds may be purchased at net asset
value, without a sales charge: by or through the Trust Division of NBC or other
affiliates of NBC for accounts which are held in a fiduciary, agency, custodial,
or similar capacity; by trustees/directors, current and retired employees, and
shareholders of NBC, the Adviser, the Distributor and their affiliates, as well
as the spouses and children under the age of 21 of such trustees/directors,
employees and shareholders; any accounts for which a current or retired employee
of NBC, the Adviser, the Distributor and their affiliates serves in a fiduciary,
agency, custodial or similar capacity; by trust companies or trust divisions of
other non-affiliated financial depository institutions; or by investors who
purchase shares through a wrap account or a no-transaction fee program if the
sponsor of the wrap account or no-transaction fee program has entered into a
sales agreement with the Distributor. In addition, a Fund may purchase shares of
another Fund at net asset value without any sales charge.
Reinvestment Privilege. If shares in a Fund have been redeemed, the shareholder
has a one-time right, within 30 days, to reinvest the redemption proceeds at the
next-determined net asset value without any sales charge. The Distributor must
be notified by the shareholder in writing or by ___________ of the reinvestment
in order to eliminate the sales charge. If the shareholder redeems shares in a
Fund, there may be tax consequences.
Reducing the Sales Charge
The sales charge can be reduced on the purchase of a Fund's shares through:
o quantity discounts and accumulated purchases;
o signing a 13-month letter of intent; or
o concurrent purchases.
Quantity Discounts and Accumulated Purchases. As shown in the table under "What
Shares Cost," larger purchases reduce the sales charge paid. Each Fund will
combine purchases made on the same day by the investor, his or her spouse, and
his or her children under age 21, when calculating the sales charge. In
addition, the sales charge, if applicable, is reduced for purchases made at one
time by a trustee or fiduciary for a single trust estate or a single fiduciary
account.
If an additional purchase of Fund shares is made, each Fund will consider the
previous purchase(s) still invested in that Fund. For example, if a shareholder
already owns shares having a current value at the public offering price of
$90,000 and he or she purchases $10,000 more at the current public offering
price, the sales charge on the additional purchase according to the schedule now
in effect would be 2.50%, not 3.00%. To receive the sales charge reduction, the
Distributor must be notified by the shareholder in writing or by _________ at
the time the purchase is made that Fund shares are already owned or that
purchases are being combined. Each Fund will reduce the sales charge after it
confirms the purchases.
Letter of Intent. If a shareholder intends to purchase at least $100,000 of
shares in the Funds over the next 13 months, the sales charge may be reduced by
signing a letter of intent to that effect. This letter includes a provision for
a sales charge adjustment depending on the amount actually purchased within the
13-month period and a provision for the custodian to hold in escrow (in shares)
3.00% of the total amount intended to be purchased until such purchase is
completed.
The shares held in escrow will be transferred to the shareholder's account
at the end of the 13-month period unless the amount specified in the letter of
intent is not purchased. In this event, an appropriate number of escrowed shares
may be redeemed in order to realize the difference in the sales charge.
This letter of intent will not obligate the shareholder to purchase shares, but
if he or she does, each purchase during the period will be at the sales charge
applicable to the total amount intended to be purchased. The current balance in
the shareholder's account will provide a purchase credit towards fulfillment of
the letter of intent. Prior trade prices will not be adjusted.
Concurrent Purchases. For purposes of qualifying for a sales charge reduction, a
shareholder has the privilege of combining concurrent purchases of two or more
Funds in the Trust, the purchase price of which includes a sales charge. For
example, if a shareholder concurrently invested $30,000 in one of the Funds and
$70,000 in another Fund, the sales charge would be reduced.
To receive this sales charge reduction, the Distributor must be notified by
the shareholder in writing or by ___________ at the time the concurrent
purchases are made. The Funds will reduce the sales charge after they confirm
the purchases.
Systematic Investment Program
Once an account has been opened, shareholders may add to their investment on a
regular basis in a minimum amount of $50. Under this program, funds may be
automatically withdrawn periodically from the shareholder's checking account at
an ACH automated member and invested in Fund shares. A shareholder may apply for
participation in this program by designating this option in the Fund account
application or by requesting the proper form by calling Great Plains Funds
Shareholder Services at 1-800-_____________________.
Certificates and Confirmations
As transfer agent for the Funds, Federated Shareholder Services Company
maintains a share account for each shareholder of record. Share certificates are
not issued. Detailed confirmations of each purchase and redemption are sent to
each shareholder. Confirmations are also sent to report dividends paid.
Dividends and Capital Gains
Dividends of the Equity Fund and Premier Fund are declared and paid monthly.
Dividends of the International Equity Fund are declared and paid annually.
Dividends of the Intermediate Bond Fund and Tax-Free Bond Fund are declared
daily and paid monthly. Only shareholders invested in a particular Fund on the
record date of the dividend declaration are paid that dividend except that
Intermediate Bond Fund and Tax-Free Bond Fund shareholders earn dividends only
on those shares for which the Fund has received payment in federal funds. net
capital gains realized by a Fund will be distributed at least once every 12
months. Unless you request cash payments of dividends and capital gains on your
Fund application or subsequently by writing to your Fund, your dividends and
capital gains are automatically reinvested in additional shares of the
respective Fund on payment dates at the ex-dividend date net asset value
(without a sales charge).
Exchange Privilege
Exchanging Shares
Shareholders of any Fund in the Trust may exchange their Fund shares for the
shares of any other Fund in the Trust at net asset value without a sales charge,
subject to meeting any minimum investment requirements. Prior to any exchange,
the shareholder must receive a copy of the current prospectus of the Fund into
which an exchange is to be effected. The exchange privilege is available to
shareholders residing in any state in which the Fund shares being acquired may
legally be sold.
Upon receipt of proper instructions and all necessary supporting documents,
shares submitted for exchange will be redeemed at the next-determined net asset
value. If the exchanging shareholder does not have an account in the Fund whose
shares are being acquired, a new account will be established with the same
registration, dividend, and capital gain options as the account from which
shares are exchanged, unless otherwise specified by the shareholder. In the case
where the new account registration is not identical to that of the existing
account, a signature guarantee is required. (See "Redeeming--Signatures.")
Exercise of this privilege is treated as a sale for federal income tax purposes
and, depending on the circumstances, a short or long-term capital gain or loss
may be realized. The exchange privilege may be terminated at any time.
Shareholders will be notified of the termination of the exchange privilege. A
shareholder may obtain further information on the exchange privilege by calling
Great Plains Funds Shareholder Services at 1-800-__________________.
Exchange by Telephone
Shareholders may provide instructions for exchanges between Funds by
calling Great Plains Funds Shareholder Services at _________. In addition,
investors may exchange shares by calling their authorized broker directly.
It is recommended that investors request this telephone privilege at the time of
their initial application. If not completed at the time of initial application,
authorization forms and information on this service can be obtained through
Great Plains Funds Shareholder Services or an authorized broker.
Shares may be exchanged by telephone only between Fund accounts having identical
shareholder registrations. Telephone exchange instructions may be recorded. If
reasonable procedures are not followed by the Funds, they may be liable for
losses due to unauthorized or fraudulent telephone instructions.
Telephone exchange instructions must be received by Great Plains Funds
Shareholder Services or an authorized broker and transmitted to Federated
Services Company before the close of regular session trading on the New York
Stock Exchange (normally 3:00 p.m Central time) for shares to be exchanged the
same day. Shareholders who exchange into shares of the Funds will not receive a
dividend from a Fund on the date of the exchange.
Shareholders of the Funds may have difficulty in making exchanges by telephone
through banks, brokers, and other financial institutions during times of drastic
economic or market changes. If shareholders cannot contact Great Plains Funds
Shareholder Services or their authorized broker by telephone, it is recommended
that an exchange request be made in writing and sent by mail for next day
delivery.
Redeeming Shares
Shares are redeemed at their net asset value next determined after a Fund
receives the redemption request. Redemptions will be made on days on which the
Funds compute their net asset value. Redemption requests cannot be executed on
days on which the New York Stock Exchange is closed or on Federal holidays when
wire transfers are restricted. Requests for redemption can be made by telephone
or by mail.
If a redemption order is received before the close of regular session trading on
the New York Stock Exchange (normally 3:00 p.m. Central time), the redemption
proceeds will normally be paid through the ACH system on the next business day
to the shareholder's bank account designated in the Fund account application. In
the absence of a designated bank account, a check will be sent to the address of
record. Normally, a check for redemption proceeds is mailed within one business
day after receipt of a proper written redemption request. Redemption proceeds
will be wired upon request. In no event will redemption proceeds be sent more
than seven calendar days after a proper request for redemption has been
received, provided the Fund or its agents have received payment from the
shareholder for the shares being redeemed.
By Telephone. Shareholders may redeem shares of a Fund by calling Great Plains
Funds Shareholder Services at 1-800-___________. The shareholder must designate
the telephone redemption option in the Fund account application or complete an
authorization form permitting the Funds to accept telephone requests.
Authorization forms and information on this service are available from Great
Plains Funds Shareholder Services. Telephone redemption instructions may be
recorded. If reasonable procedures are not followed by the Funds, they may be
liable for losses due to unauthorized or fraudulent telephone instructions.
In the event of drastic economic or market changes, a shareholder may experience
difficulty in redeeming by telephone. If such a case should occur, another
method of redemption should be utilized, such as transmitting a written request
by mail or next day delivery to Great Plains Funds Shareholder Services.
If at any time the Funds determine it necessary to terminate or modify this
method of redemption, shareholders would be promptly notified.
By Mail. Any shareholder may redeem a Fund's shares by sending a written
request to the Funds at: P.O. Box ________. The written request should include
the shareholder's name, the Fund name, the account number, and the share or
dollar amount requested, and should be signed exactly as the shares are
registered. Shareholders should call 1-800-______________ for assistance in
redeeming by mail.
Signatures. Shareholders requesting a redemption of any amount to be sent
to an address other than on record with the Funds, or a redemption payable other
than to the shareholder of record, must have signatures on written redemption
requests guaranteed by:
o a trust company or commercial bank whose deposits are insured by the Bank
Insurance Fund, which is administered by the Federal Deposit Insurance
Corporation ("FDIC");
o a member of the New York, American, Boston, Midwest, or Pacific Stock
Exchange;
o a savings bank or savings association whose deposits are insured by
the Savings Association Insurance Fund, which is administered by the FDIC; or
o any other "eligible guarantor institution," as defined in the
Securities Exchange Act of 1934.
The Funds do not accept signatures guaranteed by a notary public.
The Funds and Federated Shareholder Services Company have adopted standards for
accepting signature guarantees from the above institutions. The Funds may elect
in the future to limit eligible signature guarantors to institutions that are
members of a signature guarantee program. The Funds and Federated Shareholder
Services Company reserve the right to amend these standards at any time without
notice.
Systematic Withdrawal Program
Shareholders who desire to receive payments of a predetermined amount may take
advantage of the Systematic Withdrawal Program. Under this program, Fund shares
are redeemed to provide for periodic withdrawal payments in an amount directed
by the shareholder. Depending upon the amount of the withdrawal payments and the
amount of dividends paid with respect to Fund shares, redemptions may reduce,
and eventually deplete, the shareholder's investment in the Funds. For this
reason, payments under this program should not be considered as yield or income
on the shareholder's investment in the Funds. To be eligible to participate in
this program, a shareholder must have an account value of at least $10,000. A
shareholder may apply for participation in this program by designating this
option on the Fund account application or by completing an authorization form,
which can be requested by calling Great Plains Funds Shareholder Services at
1-800-_______________. Due to the fact that the Funds' shares are sold with a
sales charge, it is not advisable for shareholders to purchase shares of the
Funds while participating in this program.
Accounts With Low Balances
Due to the high cost of maintaining accounts with low balances, the Funds may
redeem shares in any account and pay the proceeds to the shareholder if the
account balance falls below a required minimum value of $1,000 due to
shareholder redemptions. This redemption would not occur if the account balance
falls below $1,000 because of changes in the Funds' net asset value.
Before shares are redeemed to close an account, the shareholder is notified in
writing and allowed 30 days to purchase additional shares to meet the minimum
balance requirement.
Great Plains Funds Information
Management of the Trust
Board of Trustees. The Trustees are responsible for managing the business
affairs of the Trust and for exercising all of the powers of the Trust except
those reserved for the shareholders.
Investment Adviser and Sub-Adviser. Pursuant to an investment advisory contract
with the Trust, First Commerce Investors, Inc. serves as the investment adviser
(the "Adviser") to, and makes investment decisions for, each Fund, subject to
direction by the Trustees. The Adviser continually conducts investment research
and supervision for each Fund and is responsible for the purchase and sale of
portfolio instruments, for which it receives an advisory fee from the assets of
each Fund.
The Adviser has entered into a Sub-Advisory Agreement with Peter A. Kinney
("Sub-Adviser"), pursuant to which the Sub-Adviser provides investment advice
regarding international markets and recommends (but does not select) foreign
securities for purchase by the Equity Fund and the International Equity Fund.
Investment advice provided by the Sub-Adviser shall consist of economic and
financial forecasts, financial analyses of companies having their principal
operations or place of business abroad, research analyses and various reports on
such companies, and monitoring relative foreign currency exchange valuations.
The Sub-Adviser's investment advice shall not consist of any discretionary
management. The Adviser is solely responsible for making the determination as to
whether the purchase or sale of securities is consistent with the Funds'
investment objectives, policies and limitations, and is solely responsible for
evaluating the investment merits of the Funds' individual security selections
and executing purchases or sales of securities on behalf of the Funds.
The Trust, the Adviser, the Sub-Adviser and the Funds' Distributor have adopted
strict codes of ethics governing the conduct of all employees who manage the
Trust and its portfolio securities. These codes recognize that such persons owe
a fiduciary duty to the Trust's shareholders and must place the interests of
shareholders ahead of the employees' own interest. Among other things, the
codes: require preclearance and periodic reporting of personal securities
transactions; restrict personal transactions in securities being purchased or
sold, or being considered for purchase or sale, by the Trust; prohibit personal
purchases of securities in initial public offerings; and prohibit taking profits
on securities held for less than sixty days. Violations of the codes are subject
to review by the Board of Trustees, and could result in severe penalties.
Advisory Fees. The Adviser is entitled to receive an investment advisory fee
equal to a percentage of each Fund's average daily net assets at the following
annual rates: 0.75% of Equity Fund; 1.25% of International Equity Fund; 1.00% of
Premier Fund and .50% of Intermediate Bond Fund and Tax-Free Bond Fund. The
Adviser has agreed to compensate the Sub-Adviser for its services at an annual
fee equal to the greater of $75,000 or .16% of the International Equity Fund's
daily net assets. This fee will be paid solely by the Adviser and not by any
Fund, notwithstanding that the fee may be based on the assets of the
International Equity Fund. The Adviser can voluntarily waive its advisory fees
or reimburse a Fund's expenses in whole or in part from time to time at the
Adviser's sole discretion.
Investment recommendations and decisions for the Funds will be made
independently from those of any fiduciary or other accounts that may be managed
by the Adviser, Sub-Adviser or the affiliates of either. If, however, such
accounts, a Fund, the Adviser or Sub-Adviser for its own account, are
simultaneously engaged in transactions involving the same securities, the
transactions may be combined and allocated to each account. Although this system
may adversely affect the price the Funds pay or receive, or the size of the
position they obtain, it may also enable the Funds to benefit from lower
transaction costs.
Adviser's Background. First Commerce Investors, Inc. is a registered investment
adviser and a wholly owned subsidiary of First Commerce Bancshares, Inc.
(hereinafter "FCB"), a multi-bank holding company organized as a Nebraska
corporation. FCB, through its subsidiaries and affiliates, provides a
comprehensive range of trust, commercial, consumer, correspondent and mortgage
banking services. At December 31, 1996, FCB had an asset base of over $2 billion
with banking offices throughout Nebraska including: Lincoln, Grand Island,
Hastings, Kearney, West Point, McCook and North Platte. FCB's primary business
is the ownership and management of seven commercial bank subsidiaries, a
mortgage company, a computer company and an asset management company.
The Adviser, a Nebraska corporation, offers financial services that include, but
are not limited to: investment supervisory services including stock and bond
portfolio management, and asset allocation and individual security selection for
its clients, the Trust Division of the National Bank of Commerce and FCB. As of
December 31, 1996, the Adviser managed assets of over $1.6 billion. Although the
Adviser has not previously served as an investment adviser to a mutual fund, it
has managed, on behalf of its trust clients, eight common and collective
investment funds having a market value of approximately $__________.
As part of its regular banking operations, NBC may make loans to public
companies and municipalities. Thus, it may be possible, from time to time, for
the Funds to hold or acquire the securities of issuers which are also lending
clients of NBC. Because of the internal controls maintained by the Adviser and
NBC to restrict the flow of non-public information, Fund investments are
typically made without any knowledge of NBC's or its affiliates' lending
relationships with an issuer; therefore, the lending relationship will not be a
factor in the selection of securities.
Sub-Adviser's Background. Peter A. Kinney is a registered investment adviser
(pending registration) and has been acting in a consulting capacity for the
Adviser since 1993. During that period, he has provided consultation and
recommendations on international equities, economies and currencies to the
Adviser.
From 1988 to 1993, Mr. Kinney was an International Equity Analyst for the
Adviser. Mr. Kinney received a Bachelor of Business Studies from Trinity
College, Dublin, Ireland. He received the designation of Chartered Financial
Analyst in 1991. He is a member of the Association of Investment Management and
Research and the Chicago Society of Financial Analysts. Mr. Kinney has not
previously served as an investment adviser to a mutual fund.
Portfolio Managers' Background. The Equity Fund, International Equity Fund
and the Premier Fund are managed by H. Cameron Hinds who has been President and
Chief Investment Officer of the Adviser since 1994. Mr. Hinds previously served
as an equity analyst and portfolio manager for the Adviser since 1984. Mr. Hinds
received a B.S. in Business Administration and an M.A. in Business
Administration, with a concentration in Finance, from the University of
Nebraska. He received the designation of Chartered Financial Analyst in 1987.
The Intermediate Bond Fund and the Tax-Free Bond Fund are managed by an
investment committee.
Brokerage Transactions
When selecting broker-dealers to handle the purchase and sale of portfolio
instruments, the Adviser looks for prompt execution of the order at a favorable
net price. In working with dealers, the Adviser will generally utilize those who
are recognized dealers in specific portfolio instruments, except when a better
price and execution of the order can be obtained elsewhere. When consistent with
these objectives, business may be placed with broker-dealers who furnish
investment research or services. This allows the Adviser to supplement its own
investment research activities and enables the Adviser to obtain views and
information of individuals and research staffs of many different securities
firms prior to making investment decisions. The Adviser and Sub-Adviser have not
entered into any formal or informal agreements with any broker-dealers, nor do
they maintain any "formula" which must be followed in connection with the
placement of the client's transactions in exchange for research services
provided to the Adviser and Sub-Adviser, except as noted below. However, the
Adviser does maintain a formal list of broker-dealers, which is used from time
to time as a general guide in the placement of the client's business. The
Adviser may also give consideration to those firms which have sold or are
selling shares of the Funds and other funds distributed by the Distributor.
The Adviser will authorize payment of an amount of commission for effecting a
securities transaction in excess of the amount of commission another
broker-dealer would have been charged only if the Adviser determines in good
faith that such amount of commission is reasonable in relation to the value of
the brokerage and research services provided by such broker-dealer, viewed in
terms of either that particular transaction or the Adviser's overall
responsibilities with respect to the accounts to which it exercises investment
discretion.
The Adviser makes decisions on portfolio transactions and selects brokers and
dealers subject to review by the Trustees.
Distribution of Fund Shares
Edgewood Services, Inc. (the "Distributor"), a subsidiary of Federated
Investors, is the principal distributor for shares of the Funds and a number of
other investment companies. It is a New York corporation organized on October
26, 1993.
Distribution Plan. Pursuant to the provisions of a distribution plan adopted in
accordance with Rule 12b-1 under the Investment Company Act of 1940 (the
"Plan"), the Funds may pay to the Distributor an amount computed at an annual
rate of 0.25% of the average daily net asset value of the Funds' shares to
finance any activity which is principally intended to result in the sale of the
shares subject to the Plan. The Funds have no present intention of paying or
accruing 12b-1 fees during the fiscal year ending August 31, 1998. The
Distributor may, from time to time and for such periods as it deems appropriate,
voluntarily reduce its compensation under the Plan.
The Glass-Steagall Act prohibits a bank holding company or its affiliate (such
as a commercial bank or a savings association) from being an underwriter or
distributor of most securities, but does not prohibit such entities from acting
in certain other capacities for, or providing certain other services to,
investment companies. In the event the Glass-Steagall Act is deemed to prohibit
such entities from acting in these capacities or providing these services or
should Congress relax current restrictions on such entities, the Trustees will
consider appropriate changes in the services any of these entities may provide
to the Trust or the Funds.
Shareholder Servicing Arrangements. __________________________ has been
appointed shareholder servicing agent for the Funds. As such, _________________
provides shareholder services which include, but are not limited to:
distributing prospectuses and other information, providing shareholder
assistance, and communicating or facilitating purchases and redemptions of
shares. The Funds may pay ________ a fee computed at an annual rate of up to
.25% of the average daily net asset value of the Funds' shares for which
________ provides shareholder services. The Funds have no present intention of
paying or accruing shareholder servicing fees during the fiscal year ending
August 31, 1998.
Administrative Arrangements. The Distributor may select brokers, dealers and
administrators (including depository or other institutions such as commercial
banks and savings associations) to provide distribution and/or administrative
services for which they may receive fees from the distributor based upon shares
owned by their clients or customers. These administrative services include
distributing prospectuses and other information, providing account assistance,
and communicating or facilitating purchases and redemptions of the Funds'
shares. The fees are calculated as a percentage of the average aggregate net
asset value of shareholder accounts held during the period for which the
brokers, dealers, and administrators provide services. Any fees paid for these
services by the Distributor will be reimbursed by the Adviser and not the Funds.
Administration of the Trust
Administrative Services. Federated Services Company, a subsidiary of Federated
Investors, provides the Funds with certain administrative personnel and services
necessary to operate the Trust. Such services include certain shareholder
servicing, legal and accounting services. Federated Services Company provides
these services to the Trust at an annual rate as specified below:
Maximum Average Aggregate Daily Net
Administrative Fee Assets Of The Trust
.150% on the first $250 million
.125% on the next $250 million
.100% on the next $250 million
.075% on assets in excess of $750 million
The administrative fee received during any fiscal year shall be at least
$75,000 per Fund and $30,000 per class. Federated Services Company may choose
voluntarily to reimburse all or a portion of its fee at any time at its sole
discretion.
Expenses of the Funds
Each Fund pays all of its own expenses and its allocable share of the Trust's
expenses. These expenses include, but are not limited to, the cost of:
organizing the Trust and continuing its existence; Trustees' fees; investment
advisory and administrative services; printing prospectuses and other Fund
documents for shareholders; registering the Trust, the Funds, and shares of each
Fund; taxes and commissions; issuing, purchasing, repurchasing, and redeeming
shares; fees for custodians, transfer agents, dividend disbursing agents,
shareholder servicing agents, and registrars; printing, mailing, auditing, and
certain accounting and legal expenses; reports to shareholders; meetings of
Trustees and shareholders and proxy solicitations therefor; insurance premiums;
association membership dues; and such non-recurring and extraordinary items as
may arise.
In addition, to the extent a Fund invests in another Fund, the investing Fund
bears a proportionate share of the expenses borne by such underlying Fund.
Accordingly, a shareholder in such investing Fund also bears indirectly the
expenses of the underlying Fund, including any of its distribution expenses.
However, an investor would bear those expenses if it invested directly in the
underlying Fund, rather than indirectly as a shareholder of the investing Fund.
Shareholder Information
Voting Rights
Each share of the Trust owned by a shareholder gives that shareholder one vote
in Trustee elections and other matters submitted to shareholders for vote. All
shares of each Fund in the Trust have equal voting rights, except that in
matters affecting only a particular Fund, only shareholders of that Fund are
entitled to vote. The Trust is not required to hold annual shareholder meetings.
Shareholder approval will be sought only for certain changes in the Trust's or a
Fund's operation and for election of Trustees under certain circumstances.
Trustees may be removed by the Trustees or by shareholders at a special meeting.
A special meeting shall be called by the Trustees upon the written request of
shareholders owning at least 10% of the outstanding shares of the Trust
entitled to vote.
Performance Information
From time to time, all of the Funds may advertise total return and yield, and
the Tax-Free Bond Fund may advertise its tax-equivalent yield.
Total return represents the change, over a specified period of time, in the
value of an investment in a Fund after reinvesting all income and capital gains
distributions. It is calculated by dividing that change by the initial
investment and is expressed as a percentage.
The yield for a Fund is calculated by dividing the net investment income per
share (as defined by the Securities and Exchange Commission) earned by the Fund
over a thirty-day period by the offering price per share of the Fund on the last
day of the period. This number is then annualized using semi-annual compounding.
The tax-equivalent yield is calculated similarly to the yield, but is adjusted
to reflect the taxable yield that the Tax-Free Bond Fund would have had to earn
to equal its actual yield, assuming a specific tax rate. The yield and the
tax-equivalent yield do not necessarily reflect income actually earned by a Fund
and, therefore, may not correlate to the dividends or other distributions paid
to shareholders.
From time to time, advertisements for the Funds may refer to ratings, rankings,
and other information in certain financial publications and/or compare their
performance to certain indices.
Performance Information for Predecessor Common and Collective Investment Funds
Each Fund emanates from common and/or collective investment funds currently
managed by the Adviser (the "Common and Collective Fund(s)"). It is anticipated
that the assets from each Common and Collective Fund will be transferred to the
corresponding Fund in connection with each Fund's commencement of operations.
Set forth below are certain past performance data for the Common and Collective
Funds currently managed by the Funds' Adviser. This information is deemed
relevant because the Common and Collective Funds have been managed in a manner
that, the Adviser believes, will be in all material respects equivalent to the
management of the corresponding Funds, using substantially the same investment
objective, policies, strategies, and limitations as those used by each of the
corresponding Funds. However, the past performance data shown below is not
necessarily indicative of each Fund's future performance. Each Fund is actively
managed, and its investments will vary from time to time. Each Fund's
investments will not be identical to the past portfolio investments of the
Common and Collective Funds. In that regard, the Common and Collective Funds are
not registered investment companies under the 1940 Act and therefore are not
subject to certain investment restrictions and other rules and regulations of
the 1940 Act to which the Funds are subject as registered investment companies.
In addition, the Common and Collective Funds are not subject to the various
Internal Revenue Code provisions applicable to registered investment companies.
All of these differences may have an impact on performance. Moreover, the Common
and Collective Funds did not incur the same types or amount of expenses that
correspond to the advisory, administrative, and other fees to which each Fund is
subject. Accordingly, the past performance information for the Common and
Collective Funds shown below has been adjusted to reflect the anticipated total
expense ratios for each Fund. This adjustment has the effect of lessening the
actual performance for the Common and Collective Funds. Because a sales charge
was not imposed on the Common and Collective Funds, the past performance figures
for the Common and Collective Funds shown below have been further adjusted in a
separate column to reflect the effect of the maximum sales load (i.e., 3.00% on
each Fund) applicable to certain purchasers of each Fund. This adjustment
further reduces the past performance of the Common and Collective Funds.
Corresponding performance figures which do not reflect the sales charge are also
provided.
Finally, because the assets of more than one of the Common and Collective Funds
(which are managed in a manner that the Adviser believes is in all material
respects equivalent to each other) will be transferred to a single Corresponding
Fund, the past performance of those similarly managed Common and Collective
Funds have been blended together and reflect the adjustments noted above.
<PAGE>
<TABLE>
<CAPTION>
Average Annual Total Return
for the Period Ended June 30, 1997*
Reflecting Load/Without Load
<S> <C> <C> <C> <C>
Predecessor Common Funds 1 Year 3 Years 5 Years 10 Years or
------ ------- -------
(Corresponding Great Plains Funds) Since Inception
Value Plus Stock Fund "A" 29.01%/33.01% 24.09%/25.36% 16.35%/17.07% 12.39%/12.74%
Inception: ___________ 1975
(GREAT PLAINS EQUITY FUND)
Premier Stock Fund "J" 32.03%/36.12% 22.78%/24.04% 16.04%/16.75% 12.05%/12.44%
Inception: _______ 1988
(GREAT PLAINS PREMIER FUND)
Income Bond Fund "B" 4.05%/7.27% 6.34%/7.43% 5.57%/6.22% 7.32%/7.65%
Inception: ________ 1975
(GREAT PLAINS INTERMEDIATE BOND FUND)
Tax-Exempt Bond Fund "G" 2.65%/5.83% 4.51%/5.58% 4.32%/4.95% 5.59%/5.91%
Inception: _______ 1979
(GREAT PLAINS TAX-FREE BOND FUND)
*The Average Annual Total Return for each common fund has been adjusted to
reflect each corresponding Fund's expenses, net of voluntary waivers.
Average Annual Total Return
for the Period Ended June 30, 1997*
Reflecting Load/Without Load
Predecessor Collective Funds 1 Year 3 Years 5 Years 10 Years or
------ ------- -------
(Corresponding Great Plains Funds) Since Inception
Value Plus Stock Fund "C" 26.31%/30.22% 23.09%/24.35% 15.66%/16.79% 11.48%/11.83%
Inception: ___________ 1973
(GREAT PLAINS EQUITY FUND)
Total Return Bond Fund "D" 3.88%/7.10% 6.31%/7.40% 5.62%/6.27% 7.30%/7.63%
Inception: _______ 1973
(GREAT PLAINS INTERMEDIATE BOND FUND)
Premier Stock Fund "K" 31.18%/35.24% 22.98%/24.24% 16.15%/16.86% 12.86%/13.26%
Inception: ________ 1988
(GREAT PLAINS PREMIER FUND)
* The Average Annual Total Return for each collective fund has been adjusted
to reflect each corresponding Fund's anticipated expenses, net of voluntary
waivers.
Average Annual Total Return
for the Period Ended June 30,1997*
Reflecting Load/Without Load
Blended Performance of Predecessor Common and 1 Year 3 Years 5 Years 10 Years or
------ ------- -------
Collective Funds Since Inception
(Corresponding Great Plains Funds)
Value Plus Stock Fund "A" 27.79%/31.75% 23.64%/24.90% 16.25%/16.96% 11.99%/12.33%
Value Plus Stock Fund "C"
(GREAT PLAINS EQUITY FUND)
Premier Stock Fund "J" 31.58%/35.66% 22.88%/24.14% 16.09%/16.80% 12.44%/12.84%
Premier Stock Fund "K"
(GREAT PLAINS PREMIER FUND)
Income Bond Fund "B" 3.97%/7.19% 6.35%/7.42% 5.60%/6.24% 7.32%/7.64%
Total Return Bond Fund "D"
(GREAT PLAINS INTERMEDIATE BOND FUND)
</TABLE>
* The Average Annual Total Return for each common/collective fund has been
adjusted to reflect each corresponding Fund's anticipated expenses, net of
voluntary waivers.
<PAGE>
Portfolio Investments and Strategies
Following is a description of the various portfolio investments and strategies
that the Funds may utilize to achieve their investment objectives.
Asset-Backed Securities. The Intermediate Bond Fund may invest in Asset-Backed
Securities. Asset-Backed Securities have structural characteristics similar to
Mortgage-Backed Securities (described below) but have underlying assets that
generally are not mortgage loans or interests in mortgage loans. The Fund may
invest in Asset-Backed Securities including, but not limited to, interests in
pools of receivables, such as motor vehicle installment purchase obligations and
credit card receivables, equipment leases, manufactured housing (mobile home)
leases, or home equity loans. These securities may be in the form of
pass-through instruments or asset-backed bonds. The securities are issued by
non-governmental entities and carry no direct or indirect government guarantee.
See also "Additional Investment Risks--Mortgage-Backed and Asset-Backed
Securities" section below.
Bank Instruments. All of the Funds except the Tax-Free Bond Fund may invest in
domestic Bank Instruments, which are instruments (including time and savings
deposits, bankers' acceptances and certificates of deposit) of banks and savings
associations that have capital, surplus and undivided profits of over $100
million or for which the principal amount of the instrument is insured by the
Bank Insurance Fund or the Savings Association Insurance Fund, which are
administered by the Federal Deposit Insurance Corporation. In addition, the
Equity Fund, International Equity Fund and Premier Fund may purchase foreign
Bank Instruments, which include Eurodollar Certificates of Deposit ("ECDs"),
Yankee Certificates of Deposit ("Yankee CDs") and Eurodollar Time Deposits
("ETDs"). ECDs are U.S. dollar-denominated certificates of deposit issued by
foreign branches of U.S. banks or foreign banks. Yankee CDs are U.S.
dollar-denominated certificates of deposit issued in the U.S. by branches and
agencies of foreign banks. ETDs are U.S. dollar-denominated deposits in foreign
branches of U.S. banks or foreign banks. The Funds will treat securities
credit-enhanced with a bank's irrevocable letter of credit or unconditional
guaranty as Bank Instruments.
Borrowing. Each of the Funds is permitted as a fundamental investment policy to
borrow money for temporary purposes from banks or through reverse repurchase
agreements (arrangements in which a Fund sells a portfolio instrument for a
percentage of its cash value with an agreement to buy it back on a set date) in
amounts of up to one-third of its total assets, and pledge some assets as
collateral.
Common and Preferred Stock. The Equity Fund, International Equity Fund and
Premier Fund may invest in common and preferred stock, which represent ownership
interests in the issuer of the stock. Generally, preferred stock pays a
specified dividend, and has priority over common stock as to dividend payments
by, and the rights to assets of, the issuer. However, common stock usually has
voting rights and preferred stock usually does not.
Convertible Securities. All of the Funds except the Tax-Free Bond Fund may
invest in convertible securities. Convertible securities are fixed income
securities which may be exchanged or converted into a predetermined number of
the issuer's underlying common stock at the option of the holder during a
specified time period. Convertible securities may take the form of convertible
bonds, convertible preferred stock or debentures, units consisting of "usable"
bonds and warrants or a combination of the features of several of these
securities. The investment characteristics of each convertible security vary
widely, which allows convertible securities to be employed for different
investment objectives. In selecting a convertible security, the Fund's Adviser
evaluates the investment characteristics of the convertible security as a fixed
income instrument, and the investment potential of the underlying security for
capital appreciation.
Convertible bonds and convertible preferred stocks generally retain the
investment characteristics of fixed income securities until they have been
converted but also react to movements in the underlying equity securities. The
holder is entitled to receive the fixed income of a bond or the dividend
preference of a preferred stock until the holder elects to exercise the
conversion privilege. Usable bonds are corporate bonds that can be used in whole
or in part, customarily at full face value, in lieu of cash to purchase the
issuer's common stock. Convertible securities are senior to equity securities,
and therefore have a claim to assets of the corporation prior to the holders of
common stock in the case of liquidation. However, convertible securities are
generally subordinated to similar nonconvertible securities of the same company.
The interest income and dividends from convertible bonds and preferred stocks
provide a stable stream of income with generally higher yields than common
stocks, but lower than nonconvertible securities of similar quality. The Equity
Fund, the International Equity Fund and the Premier Fund may exchange or convert
the convertible securities held in their portfolio into shares of the underlying
common stocks when, in the opinion of the Funds' Adviser, the investment
characteristics of the underlying common shares will assist the Fund in
achieving its investment objective. Otherwise, such Funds will hold or trade the
convertible securities.
Credit Enhancement. Certain of a Fund's acceptable investments may have been
credit-enhanced by a guaranty, letter of credit, or insurance. The Fund's
evaluation of an acceptable investment may include the credit quality and
ratings of credit-enhanced securities based upon the financial condition and
ratings of the party providing the credit enhancement (the "credit enhancer").
However, credit-enhanced securities will not be treated as having been issued by
the credit enhancer for diversification purposes, unless the Fund has invested
more than 10% of its assets in securities issued, guaranteed or otherwise
credit-enhanced by the credit enhancer, in which case the securities will be
treated as having been issued both by the issuer and the credit enhancer. The
bankruptcy, receivership or default of the credit enhancer will adversely affect
the quality and marketability of the underlying security.
Debt Obligations. The Funds may invest in debt obligations, including bonds,
notes, and debentures of corporate issuers or governments, which may have
floating or fixed rates of interest.
Fixed Rate Debt Obligations. The Funds may invest in fixed rate debt
obligations, including fixed rate debt securities with short-term
characteristics. Fixed rate securities with short-term characteristics
are long-term debt obligations but are treated in the market as having
short maturities because call features of the securities may make them
callable within a short period of time. A fixed rate security with
short-term characteristics would include a fixed income security priced
close to call or redemption price or fixed income security approaching
maturity, where the expectation of call or redemption is high.
Fixed rate securities exhibit more price volatility during times of
rising or falling interest rates than securities with floating rates of
interest. This is because floating rate securities, as described below,
behave like short-term instruments in that the rate of interest they
pay is subject to periodic adjustments based on a designated interest
rate index. Fixed rate securities pay a fixed rate of interest and are
more sensitive to fluctuating interest rates. In periods of rising
interest rates the value of a fixed rate security is likely to fall.
Fixed rate securities with short-term characteristics are not subject
to the same price volatility as fixed rate securities without such
characteristics. Therefore, they behave more like floating rate
securities with respect to price volatility.
Floating Rate Debt Obligations. The Funds may invest in floating rate
debt obligations, including increasing rate securities. Floating rate
securities are generally offered at an initial interest rate which is
at or above prevailing market rates. The interest rate paid on these
securities is then reset periodically (commonly every 90 days) to an
increment over some predetermined interest rate index. Commonly
utilized indices include the three-month Treasury bill rate, the
180-day Treasury bill rate, the one-month or three-month London
Interbank Offered Rate (LIBOR), the prime rate of a bank, the
commercial paper rates, or the longer-term rates on U.S. Treasury
securities. Increasing rate securities' rates are reset periodically at
different levels on a predetermined scale. These levels of interest are
ordinarily set at progressively higher increments over time. Some
increasing rate securities may, by agreement, revert to a fixed rate
status. These securities may also contain features which allow the
issuer the option to convert the increasing rate of interest to a fixed
rate under such terms, conditions, and limitations as are described in
each issuer's prospectus.
Demand Features. Each of the Funds may acquire securities that are subject to
puts and standby commitments ("demand features") to purchase the securities at
their principal amount (usually with accrued interest) within a fixed period
(usually seven days following a demand by the Funds). The demand feature may be
issued by the issuer of the underlying securities, a dealer in the securities or
by another third party, and may not be transferred separately from the
underlying security. A Fund uses these arrangements to provide it with liquidity
and not to protect against changes in the market value of the underlying
securities. The bankruptcy, receivership or default by the issuer of the demand
feature, or a default on the underlying security or other event that terminates
the demand feature before its exercise, will adversely affect the liquidity of
the underlying security. Demand features that are exercisable even after a
payment default on the underlying security may be treated as a form of credit
enhancement.
Demand Master Notes. Each of the Funds may invest in variable amount demand
master notes. Demand master notes are short-term borrowing arrangements between
a corporation or government agency and an institutional lender (such as the
Fund(s)) payable upon demand by either party. The notice period for demand
typically ranges from one to seven days, and the party may demand full or
partial payment. Generally, master notes give a Fund the option of increasing or
decreasing the principal amount of the master note on a daily or weekly basis
within certain limits. Demand master notes usually provide for floating or
variable rates of interest.
Depositary Receipts. The Equity Fund, International Equity Fund and Premier Fund
may invest in foreign issuers by purchasing Depositary Receipts (sponsored or
unsponsored ADRs, GDRs and EDRs). ADRs are typically issued by a U.S. bank or
trust company which evidence ownership of underlying securities issued by a
foreign corporation. EDRs and GDRs are typically issued by foreign banks or
trust companies, although they also may be issued by U.S. banks or trust
companies, and evidence ownership of underlying securities issued by either a
foreign or a United States corporation. Generally, Depositary Receipts in
registered form are designed for use in the U.S. securities market and
Depositary Receipts in bearer form are designed for use in securities markets
outside the United States. Depositary Receipts may not necessarily be
denominated in the same currency as the underlying securities into which they
may be converted. Ownership of unsponsored Depositary Receipts may not entitle a
Fund to financial or other reports from the issuer of the underlying security,
to which it would be entitled as the owner of sponsored Depositary Receipts.
Depositary Receipts also involve the risks of other investments in foreign
securities.
Diversification. The Intermediate Bond Fund will be a diversified Fund under the
Investment Company Act of 1940. As such, with respect to 75% of the value of its
total assets, the Intermediate Bond Fund will not invest more than 5% in
securities of any one issuer, other than cash, cash items, securities of
investment companies or securities issued or guaranteed by the government of the
United States or its agencies or instrumentalities and repurchase agreements
collateralized by U.S. government securities, nor will the Intermediate Bond
Fund acquire more than 10% of the outstanding voting securities of any one
issuer (for which purposes all indebtedness of an issuer shall be deemed a
single class and all preferred stock of an issuer shall be deemed a single
class, except that futures or option contracts and securities of mutual funds
shall not be subject to this restriction). This policy cannot be changed without
the approval of holders of a majority of the Fund's shares. All of the other
Funds will elect to be non-diversified Funds under the Investment Company Act of
1940, although they will comply with the diversification requirements of
Subchapter M of the Internal Revenue Code. For a description of the associated
risks, see "Additional Investment Risks--Non-Diversification" below.
Foreign Currency Transactions. The Equity Fund, the International Equity Fund
and the Premier Fund may enter into foreign currency transactions to obtain the
necessary currencies to settle securities transactions. Currency transactions
may be conducted either on a spot or cash basis at prevailing rates or through
forward foreign currency exchange contracts, futures contracts, or options on
foreign currencies and futures contracts, as described below.
The Equity Fund, the International Equity Fund and the Premier Fund may also
enter into foreign currency transactions to protect their assets against adverse
changes in foreign currency exchange rates or exchange control regulations. Such
changes could unfavorably affect the value of Fund assets which are denominated
in foreign currencies, such as foreign securities or funds deposited in foreign
banks, as measured in U.S. dollars. Although foreign currency exchanges may be
used by the Funds to protect against a decline in the value of one or more
currencies, such efforts may also limit any potential gain that might result
from a relative increase in the value of such currencies and might, in certain
cases, result in losses to the Funds. Further, the Funds may be affected either
unfavorably or favorably by fluctuations in the relative rates of exchange
between the currencies of different nations. Cross-hedging transactions by the
Funds involve the risk of imperfect correlation between changes in the values of
the currencies to which such transactions relate and changes in the value of the
currency or other asset or liability that is the subject of the hedge.
The Equity Fund, the International Equity Fund and the Premier Fund may enter
into a forward foreign currency exchange contract ("forward contract"), which is
an obligation to purchase or sell an amount of a particular currency at a
specific price and on a future date agreed upon by the parties.
Generally, no commission charges or deposits are involved. At the time that a
Fund enters into a forward contract, Fund assets with a value equal to the
Fund's obligation under the forward contract are segregated on the Fund's
records and are maintained until the contract has been settled. The Funds
generally will not enter into a forward contract with a term of more than one
year. The Funds will generally enter into a forward contract to provide the
proper currency to settle a securities transaction at the time the transaction
occurs ("trade date"). The period between trade date and settlement date will
vary between twenty-four hours and thirty days, depending upon local custom.
The Funds may also protect against the decline of a particular foreign currency
by entering into a forward contract to sell an amount of that currency
approximating the value of all or a portion of their assets denominated in that
currency ("hedging"). The success of this type of short-term hedging strategy is
highly uncertain due to the difficulties of predicting short-term currency
market movements and of precisely matching forward contract amounts and the
constantly changing value of the securities involved. Although the Adviser will
consider the likelihood of changes in currency values when making investment
decisions, the Adviser believes that it is important to be able to enter into
forward contracts when it believes the interests of the Funds will be served.
The Funds will not enter into forward contracts for hedging purposes in a
particular currency in an amount in excess of their assets denominated in that
currency.
The Equity Fund, the International Equity Fund and the Premier Fund may purchase
put options on foreign currencies for the purpose of protecting against declines
in the U.S. dollar value of foreign currency-denominated portfolio securities
and against increases in the U.S. dollar cost of such securities to be acquired.
As in the case of other kinds of options, however, the writing of an option on a
foreign currency constitutes only a partial hedge, up to the amount of the
premium received, and the Funds could be required to purchase or sell foreign
currencies at disadvantageous exchange rates, thereby incurring losses. The
purchase of an option on a foreign currency may constitute an effective hedge
against fluctuations in exchange rates although, in the event of rate movements
adverse to the Funds' position, they may forfeit the entire amount of the
premium plus related transaction costs. Options on foreign currencies to be
written or purchased by the Funds may be traded on U.S. and foreign exchanges or
over-the-counter.
The Equity Fund, International Equity Fund and Premier Fund may invest in
currency futures transactions for bona fide hedging purposes. A futures contract
on a foreign currency is an agreement to buy or sell a specified amount of a
currency for a set price on a future date. When the Fund enters into a futures
contract, it must make an initial deposit, known as "initial margin," as a
partial guarantee of its performance under the contract. As the value of the
currency fluctuates, either party to the contract is required to make additional
margin payments, known as "variation margin," to cover any additional obligation
it may have under the contract. In addition, when the Fund enters into a futures
contract, it will segregate assets to "cover" its position in accordance with
the Investment Company Act of 1940. See "Policies and Acceptable Investments -
Foreign Currency Hedging Transactions" in the Statement of Additional
Information for additional information on these transactions.
Forward Commitments, When-Issued and Delayed Delivery Transactions The Funds may
enter into forward commitments and purchase portfolio securities on a
when-issued and delayed delivery basis. These transactions are arrangements in
which a Fund purchases securities with payment and delivery scheduled for a
future time. The seller's failure to complete these transactions may cause a
Fund to miss a price or yield considered to be advantageous. Settlement dates
may be a month or more after entering into these transactions, and the market
values of the securities purchased may vary from the purchase prices.
The Funds may dispose of a commitment prior to settlement if the Adviser deems
it appropriate to do so. In addition, a Fund may enter into transactions to sell
its purchase commitments to third parties at current market values and
simultaneously acquire other commitments to purchase similar securities at later
dates. The Fund may realize short-term profits or losses upon the sale of such
commitments.
High-Yield Debt Obligations. The Intermediate Bond Fund may invest up to 35%
(although it intends to operate with not more than 15%) of its total assets in
debt securities that are rated below investment-grade but not lower than BB or
Ba by an NRSRO (or, if unrated, are determined by the Adviser to be of
comparable quality). Some of these securities may involve equity
characteristics. The Fund may invest in equity securities, including unit
offerings which combine fixed rate securities and common stock or common stock
equivalents such as warrants, rights and options. Securities which are rated BB
or Ba are considered speculative with respect to capacity to pay interest and
repay principal in accordance with the terms of the obligations. These
securities are commonly referred to as "junk bonds." Debt obligations that are
not determined to be investment grade are high-yield, high-risk bonds, typically
subject to greater market fluctuations and greater risk of loss of income and
principal due to an issuer's default. To a greater extent than investment-grade
bonds, lower-rated bonds tend to reflect short-term corporate, economic and
market developments, as well as investor perceptions of the issuer's credit
quality. In addition, lower-rated bonds may be more difficult to dispose of or
to value than higher-rated, lower-yielding bonds. A description of the rating
categories for the permissible investments are contained in the Appendix to this
Prospectus. See also "Additional Investment Risks--High Yield Debt Obligations."
Illiquid and Restricted Securities. Each of the Funds may invest in illiquid and
restricted securities. Illiquid securities are any securities a Fund owns which
it may not be able to sell quickly (within seven days) at a fair price.
Restricted securities are any securities in which a Fund may otherwise invest
pursuant to its investment objective and policies, but which are subject to
restriction on resale under federal securities laws. To the extent restricted
securities are deemed to be illiquid, a Fund will limit its purchases, together
with other securities considered to be illiquid, to 15% of its net assets.
Lending Portfolio Securities. In order to generate additional income, each of
the Funds is permitted as a fundamental investment policy to lend portfolio
securities on a short-term or long-term basis, or both, up to one-third of the
value of its respective total assets to broker/dealers, banks, or other
institutional borrowers of securities. The Funds will only enter into loan
arrangements with broker/dealers, banks, or other institutions which the Adviser
has determined are creditworthy under guidelines established by the Trustees and
will receive collateral in the form of cash or U.S. government securities equal
to at least 100% of the value of the securities loaned. Collateral received in
the form of cash may be invested in highly liquid investments, including
repurchase agreements and other money market instruments. There is the risk that
when lending portfolio securities, the securities may not be available to a Fund
on a timely basis and the Fund may, therefore, lose the opportunity to sell the
securities at a desirable price. In addition, in the event that a borrower of
securities would file for bankruptcy or become insolvent, disposition of the
securities may be delayed pending court action.
Mortgage-Backed Securities. The Intermediate Bond Fund may invest in
mortgage-backed securities rated at the time of purchase investment grade (BBB
or Baa or better) by an NRSRO, or which are of comparable quality in the
judgment of the Adviser. Mortgage-backed securities are securities that directly
or indirectly represent a participation in, or are secured by and payable from,
mortgage loans on real property. There are currently four basic types of
mortgage-backed securities: (i) those issued or guaranteed by the U.S.
government or one of its agencies or instrumentalities, such as the Government
National Mortgage Association ("Ginnie Mae"), Federal National Mortgage
Association ("Fannie Mae"), and Federal Home Loan Mortgage Corporation ("Freddie
Mac"); (ii) those issued by private issuers that represent an interest in or are
collateralized by mortgage-backed securities issued or guaranteed by the U.S.
government or one of its agencies or instrumentalities; (iii) those issued by
private issuers that represent an interest in or are collateralized by whole
loans or mortgage-backed securities without a government guarantee but usually
having some form of private credit enhancement; and (iv) privately issued
securities which are collateralized by pools of mortgages in which each mortgage
is guaranteed as to payment of principal and interest by an agency or
instrumentality of the U.S. government.
The privately issued mortgage-related securities provide for a periodic
payment consisting of both interest and/or principal. The interest portion of
these payments will be distributed by the Fund as income, and the capital
portion will be reinvested.
Collateralized Mortgage Obligations ("CMOS"). The Intermediate Bond
Fund may invest in CMOs. CMOs are debt obligations collateralized by
mortgage loans or mortgage pass-through securities. Typically, CMOs are
collateralized by Ginnie Mae, Fannie Mae or Freddie Mac certificates,
but may be collateralized by whole loans or private pass-through
securities. CMOs may have fixed or floating rates of interest.
The Intermediate Bond Fund may also invest in certain CMOs which are
issued by private entities such as investment banking firms and
companies related to the construction industry. The CMOs in which the
Fund may invest may be: (i) securities which are collateralized by
pools of mortgages in which each mortgage is guaranteed as to payment
of principal and interest by an agency or instrumentality of the U.S.
government; (ii) securities which are collateralized by pools of
mortgages in which payment of principal and interest is guaranteed by
the issuer and such guarantee is collateralized by U.S. government
securities; (iii) collateralized by pools of mortgages in which payment
of principal and interest is dependent upon the underlying pool of
mortgages with no U.S. government guarantee; or (iv) other securities
in which the proceeds of the issuance are invested in mortgage-backed
securities and payment of the principal and interest is supported by
the credit of an agency or instrumentality of the U.S. government.
PAC Bonds and Parallel Pay CMO's. The Intermediate Bond Fund may invest
in parallel pay CMOs and Planned Amortization Class CMOs ("PAC Bonds").
Parallel pay CMOs are structured to provide payments of principal on
each payment date to more than one class. These simultaneous payments
are taken into account in calculating the stated maturity date or final
distribution date of each class, which, as with other CMO structures,
must be retired by its stated maturity date or final distribution date
but may be retired earlier. PAC Bonds generally require payments of a
specified amount of principal on each payment date. PAC Bonds are
always parallel pay CMOs with the required principal payment on such
securities having the highest priority after interest has been paid to
all classes.
Real Estate Mortgage Investment Conduits. The Intermediate Bond Fund
may invest in real estate mortgage investment conduits ("REMICs") which
are offerings of multiple class real estate Mortgage-Backed Securities
which qualify and elect treatment as such under provisions of the
Internal Revenue Code. Issuers of REMICs may take several forms, such
as trusts, partnerships, corporations, associations or a segregated
pool of mortgages. Once REMIC status is elected and obtained, the
entity is not subject to federal income taxation. Instead, income is
passed through the entity and is taxed to the person or persons who
hold interests in the REMIC. A REMIC interest must consist of one or
more classes of "regular interests," some of which may offer adjustable
rates, and a single class of "residual interests." To qualify as a
REMIC, substantially all of the assets of the entity must be in assets
directly or indirectly secured principally by real property.
Municipal Securities. The Intermediate Bond Fund and the Tax-Free Bond Fund may
invest in Municipal Securities which are generally issued to finance public
works such as airports, bridges, highways, housing, hospitals, mass
transportation projects, schools, streets, and water and sewer works. They are
also issued to repay outstanding obligations, to raise funds for general
operating expenses, and to make loans to other public institutions and
facilities. The Tax-Free Bond Fund will, to the extent available and consistent
with its investment objectives, invest in Nebraska Municipal Securities. While
the Tax-Free Bond Fund will purchase Municipal Securities that pay tax-free
income, the Intermediate Bond Fund will generally purchase taxable Municipal
Securities.
Municipal Securities include industrial development bonds issued by or on behalf
of public authorities to provide financing aid to acquire sites or construct and
equip facilities for privately or publicly owned corporations. The availability
of this financing encourages these corporations to locate within the sponsoring
communities and thereby increases local employment.
The two principal classifications of Municipal Securities are "general
obligation" and "revenue" bonds. General obligation bonds are secured by the
issuer's pledge of its full faith and credit and taxing power for the payment of
principal and interest. Interest on and principal of revenue bonds, however, are
payable only from the revenue generated by the facility financed by the bond or
other specified sources of revenue. Revenue bonds do not represent a pledge of
credit or create any debt of or charge against the general revenues of a
municipality or public authority. Industrial development bonds are typically
classified as revenue bonds.
Municipal Leases. The Intermediate Bond Fund and the Tax-Free Bond Fund
may purchase municipal leases, which are obligations issued by state
and local governments or authorities to finance the acquisition of
equipment and facilities and may be considered to be illiquid. They may
take the form of a lease, an installment purchase contract, a
conditional sales contract, or a participation interest in any of
these.
Participation Interests. The Intermediate Bond Fund and the Tax-Free
Bond Fund may purchase interests in Municipal Securities from financial
institutions such as commercial and investment banks, savings
associations and insurance companies. These interests may take the form
of participations, beneficial interests in a trust, partnership
interests or any other form of indirect ownership that allows the Fund
to treat the income from the investment as exempt from federal income
tax. The financial institutions from which the Fund purchases
participation interests frequently provide or obtain irrevocable
letters of credit or guarantees to attempt to assure that the
participation interests are of acceptable quality. The Funds invest in
these participation interests in order to obtain credit enhancement or
demand features that would not be available through direct ownership of
the underlying Municipal Securities.
Nebraska Municipal Securities. Historically, many of the Municipal
Securities offered by Nebraska issuers have been unrated. This is in
part due to the relatively small size of many offerings, the cost and
conditions of obtaining a rating and the historical willingness of the
capital markets to purchase municipal securities offered by Nebraska
issuers without insurance or ratings. As a result, it is likely that
many of the Nebraska Municipal Securities that the Tax-Free Bond Fund
will purchase will be uninsured or unrated. The Fund will only purchase
unrated securities if they are insured or of comparable quality to the
rated Municipal Securities that the Fund is allowed to purchase. In
determining whether unrated Municipal Securities are of comparable
quality, the Adviser will perform a credit analysis of each issuer of
such unrated securities pursuant to policies and procedures reviewed
and approved by the Board of Trustees on an ongoing basis.
The Tax-Free Bond Fund's investment emphasis on securities issued by
Nebraska municipalities and political subdivisions involves somewhat
greater risks than a fund broadly invested in securities issued by
municipalities and political subdivisions in many states. The credit
quality of the issuers of the Nebraska Municipal Securities will depend
on the future financial strength of the Nebraska economy and the
financial condition of the Nebraska municipalities and political
subdivisions issuing such securities. While most Nebraska
municipalities and political subdivisions are predominantly reliant on
independent revenue sources, such as property and sales taxes, they are
not immune to budget shortfalls caused by cutbacks in state aid. While
many observers believe the Nebraska economy has been generally immune
from national recessionary forces, the state economy is agriculturally
based and can be significantly impacted by down trends in the commodity
markets and cutbacks in federal agricultural programs. See the
Statement of Additional Information for information about the Nebraska
economy.
Prime Commercial Paper Each of the Funds except the Tax-Free Bond Fund may
purchase Prime Commercial Paper, which is a short-term debt obligation that
matures in 270 days or less, is issued by banks, corporations or other
institutions, and is rated one of the two highest rating categories for
short-term obligations by an NRSRO or, if unrated, is of comparable quality to
securities having such ratings, as determined by the Adviser.
Portfolio Turnover. Although none of the Funds intends to invest for the purpose
of seeking short-term profits, securities will be sold whenever the Fund's
Adviser believes it is appropriate to do so in light of the Fund's investment
objective, without regard to the length of time a particular security may have
been held.
Ratings. Securities rated in the fourth highest investment grade category (Baa
by Moody's, or BBB by S&P or Fitch) have speculative characteristics and changes
in economic conditions or other circumstances are more likely to lead to a
weakened capacity to make principal and interest payments than higher rated
securities. The Appendix to this Prospectus contains a complete description of
ratings.
If a security is downgraded below the permissible investment category for a
Fund, the Adviser will determine whether or not the security continues to be an
acceptable investment; if not, the security will be sold.
Repurchase Agreements. The securities in which the Funds invest may be purchased
pursuant to repurchase agreements. Repurchase agreements are arrangements in
which banks, broker/dealers, and other recognized financial institutions sell
U.S. government securities or other securities to a Fund and agree at the time
of sale to repurchase them at a mutually agreed upon time and price. To the
extent that the original seller does not repurchase the securities from a Fund,
the Fund could receive less than the repurchase price on any sale of such
securities.
Securities of Other Investment Companies. Each of the Funds may invest in the
securities of other unaffiliated investment companies, but generally will not
own more than 3% of the total outstanding voting stock of any investment
company, invest more than 5% of its respective total assets in any one
investment company, or invest more than 10% of its respective total assets in
investment companies in general, unless permitted to exceed these limitations by
other provisions of the Investment Company Act of 1940 or an exemptive order of
the SEC.
In addition, subject to granting of an exemptive order of the SEC, each Fund
will have the ability to invest a portion of its assets in another Fund,
provided it is consistent with its investment objective and complies with
certain SEC conditions. In that regard, the Equity Fund intends to invest a
portion of its assets in the International Equity Fund in lieu of directly
purchasing foreign securities. Depending on market conditions, the Equity Fund
anticipates investing between 0% and 35% of its net assets in the International
Equity Fund. Similarly, the Premier Fund may invest a portion of its assets in
the International Equity Fund, although it has no present intention to do so. It
should be noted that investment companies incur certain expenses such as
management fees and, therefore, any investment by a fund in shares of another
investment company would be subject to duplicate expenses. See "Expenses of the
Funds" herein.
The International Equity Fund may invest indirectly in foreign capital markets
by purchasing shares of closed-end investment companies, but generally only in
open-market transactions involving only customary brokerage commissions.
Sometimes the Fund may pay a premium over net asset value for such shares.
Short Sales. The Equity Fund, International Equity Fund and Premier Fund may
make short sales pursuant to a fundamental policy. A short sale occurs when a
borrowed security is sold in anticipation of a decline in its price. If the
decline occurs, shares equal in number to those sold short can be purchased at
the lower price. If the price increases, the higher price must be paid. The
purchased shares are then returned to the original lender. Risk arises because
no loss limit can be placed on the transaction. When a Fund enters into a short
sale, assets equal to the market price of the securities sold short or any
lesser price at which the Fund can obtain such securities, are segregated on the
Fund's records and maintained until the Fund meets its obligations under the
short sale.
Temporary Investments. When the Adviser judges that market conditions warrant a
defensive investment position, each of the Funds may temporarily invest up to
100% of their assets in short-term debt obligations (money market instruments).
These investments include commercial paper, bank instruments, U.S. government
obligations, repurchase agreements, securities of other investment companies,
taxable or tax-free Municipal Securities and foreign securities. Each Fund's
temporary investments must be of comparable quality to its primary investments.
U.S. Government Securities. All of the Funds may invest in U.S. government
securities. These instruments are either issued or guaranteed by the U.S.
government, its agencies, or instrumentalities. These securities include, but
are not limited to:
o direct obligations of the U.S. Treasury, such as U.S. Treasury bills,
notes, and bonds;
o notes, bonds, and discount notes issued or guaranteed by U.S. government
agencies and instrumentalities supported by the full faith and credit of the
United States;
o notes, bonds, and discount notes of other U.S. government agencies or
instrumentalities which receive or have access to federal funding; and
o notes, bonds, and discount notes of other U.S. government
instrumentalities supported only by the credit of the instrumentalities .
Variable Rate Demand Notes. Each Fund may purchase variable rate demand notes,
which are long-term debt instruments that have variable or floating interest
rates and provide the Fund with the right to tender the security for repurchase
at its stated principal amount plus accrued interest. Such securities typically
bear interest at a rate that is intended to cause the securities to trade at
par. The interest rate may float or be adjusted at regular intervals (ranging
from daily to annually), and is normally based on a published interest rate or
interest rate index. Many variable rate demand notes allow a Fund to demand the
repurchase of the security on not more than seven days prior notice. Other notes
only permit a Fund to tender the security at the time of each interest rate
adjustment or at other fixed intervals. (See "Demand Features"). Each Fund
treats variable rate demand notes as maturing on the later of the date of the
next interest rate adjustment or the date on which a Fund may next tender the
security for repurchase.
Warrants. The Equity Fund, the International Equity Fund and Premier Fund may
invest in warrants. Warrants provide an option to purchase common stock at a
specific price (usually at a premium above the market value of the optioned
common stock at issuance) valid for a specific period of time. Warrants may have
a life ranging from less than a year to twenty years or may be perpetual.
However, most warrants have expiration dates after which they are worthless. In
addition, if the market price of the common stock does not exceed the warrant's
exercise price during the life of the warrant, the warrant will expire as
worthless. Warrants have no voting rights, pay no dividends, and have no rights
with respect to the assets of the corporation issuing them. The percentage
increase or decrease in the market price of the warrant may tend to be greater
than the percentage increase or decrease in the market price of the underlying
common stock.
Zero Coupon Securities. The Intermediate Bond Fund may invest in zero coupon
bonds. The Fund may invest in zero coupon bonds in order to receive the rate of
return through the appreciation of the bond. This application is extremely
attractive in a falling rate environment as the price of the bond rises rapidly
in value as opposed to regular coupon bonds. A zero coupon bond makes no
periodic interest payments and the entire obligation becomes due only upon
maturity.
Zero coupon bonds are debt securities which are issued at a discount to their
face amount and do not entitle the holder to any periodic payments of interest
prior to maturity. Rather, interest earned on zero coupon securities accretes at
a stated yield until the security reaches its face amount at maturity. In
addition, zero coupon securities usually have put features that provide the
holder with the opportunity to sell the bonds back to the issuer at a stated
price before maturity.
Generally, the prices of zero coupon securities are more sensitive to
fluctuations in interest than are conventional bonds and convertible securities.
In addition, federal tax law requires the holder of a zero coupon security to
recognize income from the security prior to the receipt of cash payments. To
maintain its qualification as a regulated investment company and to avoid
liability for federal income taxes, the Fund will be required to distribute
income accrued from zero coupon securities which it owns, and may have to sell
portfolio securities (perhaps at disadvantageous times) in order to generate
cash to satisfy these distribution requirements.
Additional Investment Risks
Debt Market. In the debt market, prices move inversely to interest rates. A
decline in market interest rates results in a rise in the market prices of
outstanding debt obligations. Conversely, an increase in market interest rates
results in a decline in market prices of outstanding debt obligations. In either
case, the amount of change in market prices of debt obligations in response to
changes in market interest rates generally depends on the maturity of the debt
obligations: the debt obligations with the longest maturities will experience
the greatest market price changes.
The market value of debt obligations, and therefore each Fund's net asset value,
will fluctuate due to changes in economic conditions and other market factors
such as interest rates which are beyond the control of the Funds' Adviser or
Sub-Adviser. The Funds' Adviser or Sub-Adviser could be incorrect in its
expectations about the direction or extent of these market factors. Although
debt obligations with longer maturities offer potentially greater returns, they
have greater exposure to market price fluctuation. Consequently, to the extent a
Fund is significantly invested in debt obligations with longer maturities, there
is a greater possibility of fluctuation in the Fund's net asset value.
High Yield Debt Obligations. The Intermediate Bond Fund may invest in high yield
debt obligations. These lower-rated securities will usually offer higher yields
than higher-rated securities. However, there is more risk associated with these
investments. (For example, securities rated in the lowest category may have been
unable to satisfy their obligations under the bond indenture.) These lower-rated
bonds may be more susceptible to real or perceived adverse economic conditions
than investment grade bonds. These lower-rated bonds are regarded as
predominantly speculative with regard to each issuer's continuing ability to
make principal and interest payments. In addition, the secondary trading market
for lower-rated bonds may be less liquid than the market for investment grade
bonds. As a result of these factors, lower-rated securities tend to have more
price volatility and carry more risk to principal than higher-rated securities.
The Adviser will endeavor to limit these risks through diversifying the
portfolio and through careful credit analysis of individual issuers. Purchasers
should carefully assess the risks associated with an investment in the Fund.
Many corporate debt obligations, including many lower-rated bonds, permit the
issuers to call the security and thereby redeem their obligations earlier than
the stated maturity dates. Issuers are more likely to call bonds during periods
of declining interest rates. In these cases, if the Intermediate Bond Fund owns
a bond which is called, the Fund will receive its return of principal earlier
than expected and would likely be required to reinvest the proceeds at lower
interest rates, thus reducing income to the Fund. In addition, lower-rated bonds
may be more difficult to dispose of or to value than higher-rated,
lower-yielding bonds.
Mortgage-Backed and Asset-Backed Securities. Mortgage-Backed and Asset-Backed
Securities generally pay back principal and interest over the life of the
security. At the time a Fund reinvests the payments and any unscheduled
prepayments of principal received, the Fund may receive a rate of interest which
is actually lower than the rate of interest paid on these securities
("prepayment risks"). Mortgage-Backed and Asset-Backed Securities are subject to
higher prepayment risks than most other types of debt instruments with
prepayment risks because the underlying mortgage loans or the collateral
supporting Asset-Backed Securities may be prepaid without penalty or premium.
Prepayment risks on Mortgage-Backed Securities tend to increase during periods
of declining mortgage interest rates because many borrowers refinance their
mortgages to take advantage of the more favorable rates. Prepayments on
Mortgage-Backed Securities are also affected by other factors, such as the
frequency with which people sell their homes or elect to make unscheduled
payments on their mortgages. Although Asset-Backed Securities generally are less
likely to experience substantial prepayments than are Mortgage-Backed
Securities, certain factors that affect the rate of prepayments on
Mortgage-Backed Securities also affect the rate of prepayments on Asset-Backed
Securities.
While Mortgage-Backed Securities generally entail less risk of a decline during
periods of rapidly rising interest rates, Mortgage-Backed Securities may also
have less potential for capital appreciation than other similar investments
(e.g., investments with comparable maturities) because as interest rates
decline, the likelihood increases that mortgages will be prepaid. Furthermore,
if Mortgage-Backed Securities are purchased at a premium, mortgage foreclosures
and unscheduled principal payments may result in some loss of a holder's
principal investment to the extent of the premium paid. Conversely, if
Mortgage-Backed Securities are purchased at a discount, both a scheduled payment
of principal and an unscheduled prepayment of principal would increase current
and total returns and would accelerate the recognition of income, which would be
taxed as ordinary income when distributed to shareholders.
Asset-Backed Securities present certain risks that are not presented by
Mortgage-Backed Securities. Primarily, these securities do not have the benefit
of the same security interest in the related collateral. Credit card receivables
are generally unsecured and the debtors are entitled to the protection of a
number of state and federal consumer credit laws, many of which give such
debtors the right to set off certain amounts owed on the credit cards, thereby
reducing the balance due. Most issuers of Asset-Backed Securities backed by
motor vehicle installment purchase obligations permit the servicer of such
receivables to retain possession of the underlying obligations. If the servicer
sells these obligations to another party, there is a risk that the purchaser
would acquire an interest superior to that of the holders of the related
Asset-Backed Securities. Further, if a vehicle is registered in one state and is
then re-registered because the owner and obligor moves to another state, such
reregistration could defeat the original security interest in the vehicle in
certain cases. In addition, because of the large number of vehicles involved in
a typical issuance and technical requirements under state laws, the trustee for
the holders of Asset-Backed Securities backed by automobile receivables may not
have a proper security interest in all of the obligations backing such
receivables. Therefore, there is the possibility that recoveries on repossessed
collateral may not, in some cases, be available to support payments on these
securities.
Municipal Securities. Yields on Municipal Securities depend on a variety of
factors, including: the general conditions of the short-term municipal note
market and of the municipal bond market; the size of the particular offering;
the maturity of the obligations; and the rating of the issue. The ability of the
Intermediate Bond Fund or Tax-Free Bond Fund to achieve its investment objective
by purchasing Municipal Securities also depends on the continuing ability of the
issuers of Municipal Securities and demand features, or the credit enhancers of
either, to meet their obligations for the payment of interest and principal when
due.
Since the Tax-Free Bond Fund may invest a significant portion of its assets in
Nebraska Municipal Securities, the Fund is susceptible to political and economic
factors affecting the issuers of Nebraska Municipal Securities. The Nebraska
economy performed steadily during 1995 as the national economy continued its
slow expansion. The Nebraska economy generally avoided the national recession of
the early 1990's and continued to expand in 1995 with growth in the labor force,
jobs, retail sales, tourism visits and population. Overall, it is anticipated
that the State's economy will grow moderately during the next two years,
reflecting the national economy. Historically, the Nebraska economy tends to be
less cyclical than the national economy. It typically does not grow as fast as
the national economy during expansions and does not contract as much during
recessions.
The Tax-Free Bond Bond Fund has a fundamental investment restriction which
prohibits the Fund from investing more than 25% of its total assets in
securities of issuers in any single industry. This restriction does not,
however, place any such limitation on the purchase of securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities, or by
Nebraska, its political subdivisions, municipalities, agencies and authorities.
Moreover, the Fund may invest 25% or more of its total assets in Municipal
Securities whose revenue sources are from mortgage loans, community development,
education, electric utilities, health care, housing and transportation. There
may be economic, business or political developments or changes that affect
securities of a similar type, such as changes in government regulation,
increased costs of necessary materials, increased competition, or declining
market needs. Therefore, developments affecting a single issuer or industry or
securities financing such projects may have a significant impact on the Fund's
performance.
Stock Market. As with other mutual funds that invest primarily in equity
securities, the Equity Fund, International Equity Fund and Premier Fund are
subject to market risks. That is, the possibility exists that common stocks will
decline over short or even extended periods of time, and the United States
equity market tends to be cyclical, experiencing both periods when stock prices
generally increase and periods when stock prices generally decrease.
Small and Medium Capitalization Stocks. Stocks in the small and
medium capitalization sector of the United States equity market tend
to be slightly more volatile in price than larger capitalization
stocks, such as those included in the Standard & Poor's Daily Stock
Price Index of 500 Common Stocks ("S&P 500".) This is because, among
other things, small- and medium-sized companies may have less
certain growth prospects than larger companies, have a lower degree
of liquidity in the equity market, and tend to have a greater
sensitivity to changing economic conditions. Further, in addition to
exhibiting slightly higher volatility, the stocks of small- and
medium-sized companies may, to some degree, fluctuate independently
of the stocks of large companies. That is, the stocks of small- and
medium-sized companies may decline in price as the price of large
company stocks rise or vice versa.
Foreign Securities. Investing in non-U.S. securities carries substantial risks
in addition to those associated with domestic investments. The risks associated
with investing in foreign securities include: risks of adverse political,
social, diplomatic and economic developments (including possible governmental
seizure or nationalization of assets) and difficulty assessing trends in these
areas; the possible imposition of exchange controls or other governmental
restrictions; default in foreign government securities; foreign companies are
not generally subject to uniform financial reporting, auditing and accounting
standards, and auditing practices and requirements may not be comparable to
those applicable to U.S. companies; there are less readily available market
quotations on foreign companies; there is the possibility of less publicly
available information on foreign securities and their issuers; there are
differences in government regulation and supervision of foreign stock exchanges,
brokers, listed companies, and banks; there is generally lower foreign stock
market volume; there is the likelihood that foreign securities may be less
liquid or more volatile; foreign brokerage commissions and other transaction
costs (such as custodial services) may be higher; there is unreliable mail
service between countries; there are restrictions on foreign investments in
other jurisdictions; there are difficulties which may be encountered in
enforcing contractual obligations and obtaining or enforcing a court judgment
abroad and effecting repatriation of capital invested abroad; and there are
delays or problems in settlement of foreign transactions, which could adversely
affect shareholder equity or cause the Fund to miss attractive investment
opportunities. In addition, foreign securities may be subject to foreign taxes,
which reduce yield and total return.
Exchange Rates. Foreign securities may be denominated in foreign
currencies. Although the International Equity Fund intends to invest
in such foreign currency-denominated securities to a greater extent
than the Equity Fund and Premier Fund, the value in U.S. dollars of
each of these Funds' assets and income may be affected by changes in
exchange rates and regulations. Although each Fund values its assets
daily in U.S. dollars, it will not convert its holding of foreign
currencies to U.S. dollars daily. When a Fund converts its holdings
to another currency, it may incur conversion costs. Foreign exchange
dealers realize a profit on the difference between the prices at
which they buy and sell currencies.
Foreign Money Market Instruments. ECDs, ETDs, Yankee CDs, and
Europaper are subject to somewhat different risks than domestic
obligations of domestic issuers. Examples of these risks include
international, economic, and political developments, foreign
governmental restrictions that may adversely affect the payment of
principal or interest, foreign withholding or other taxes on
interest income, difficulties in obtaining or enforcing a judgment
against the issuing bank, and the possible impact of interruptions
in the flow of international currency transactions. Different risks
may also exist for ECDs, ETDs, and Yankee CDs because the banks
issuing these instruments, or their domestic or foreign branches,
are not necessarily subject to the same regulatory requirements that
apply to domestic banks, such as reserve requirements, loan
limitations, examinations, accounting, auditing, and recordkeeping,
and the public availability of information. These factors will be
carefully considered by a Fund's Adviser in selecting these
investments.
U.S. Government Policies. In the past, U.S. government policies have
discouraged or restricted certain investments abroad by investors. When such
policies are instituted, the Equity Fund, International Equity Fund and Premier
Fund will abide by them.
Futures and Options. When a Fund uses futures and options on futures as hedging
devices, there is a risk that the values of the currencies subject to the
futures contracts may not correlate with the values of the currencies in the
Fund's portfolio. This may cause the futures contract and any related options to
react differently than the portfolio securities to market changes. In addition,
the Fund's Adviser or Sub-Adviser could be incorrect in its expectations about
the direction or extent of market factors such as interest or currency exchange
rate movements. In these events, the Fund may lose money on the futures contract
or option. Also, it is not certain that a secondary market for positions in
futures contracts or for options will exist at all times. Although the Fund's
Adviser will consider liquidity before entering into such transactions, there is
no assurance that a liquid secondary market on an exchange or otherwise will
exist for any particular futures contract or option at any particular time. The
Fund's ability to establish and close out futures and options positions depends
on this secondary market.
Non-Diversification. Although the Equity Fund, International Equity Fund,
Premier Fund and Tax-Free Bond Fund are designated as non-diversified investment
portfolios under the Investment Company Act of 1940, and as such intend to
comply with the diversification requirements of Subchapter M of the Internal
Revenue Code (described below). As such, these Funds are subject to less
stringent limitations on the percentage of assets which can be invested in any
single issuer. An investment in these Funds, therefore, will entail greater risk
than would exist in a diversified portfolio of securities because the higher
percentage of investments among fewer issuers may result in greater fluctuation
in the total market value of such Funds' portfolios. Any economic, political, or
regulatory developments affecting the value of the securities in these Funds'
portfolios may have a greater impact on the total value of the portfolios than
would be the case if the portfolios were diversified among more issuers.
Notwithstanding the foregoing, each Fund intends to comply with the
diversification requirements of Subchapter M of the Internal Revenue Code. This
requires that at the end of each quarter of the Fund's taxable year, the
aggregate value of all investments of the Fund in any one issuer (except U.S.
government obligations, cash, cash items and other investment companies) which
exceed 5% of the Fund's total assets (valued at the time of investment) shall
not exceed 50% of the value of its total assets, and, with respect to the
remaining assets, no more than 25% of the Fund's assets valued at the time of
investment shall be invested in a single issuer.
Tax Information
Federal Income Tax
None of the Funds will pay federal income tax because each expects to meet
requirements of the Internal Revenue Code applicable to regulated investment
companies and to receive the special tax treatment afforded to such companies.
Each Fund will be treated as a single, separate entity for federal income tax
purposes so that income (including capital gains) and losses realized by the
other Funds of the Trust, if any, will not be combined for tax purposes with
those realized by any of the other Funds.
Unless otherwise exempt, you are required to pay federal income tax on any
dividends and other distributions received. However, shareholders of Tax-Free
Bond Fund are not required to pay the federal regular income tax on any
dividends received from the Fund that represent net interest on tax-exempt
municipal bonds; but, under the Tax Reform Act of 1986, dividends representing
net interest earned on certain "private-activity" municipal bonds may be
included in calculating the federal individual alternative minimum tax or the
federal alternative minimum tax for corporations. Dividends of the Tax-Free Bond
Fund representing net interest income earned on some temporary taxable
investments and any realized net short-term gains are taxed as ordinary income.
Investment income received by the International Equity Fund from sources within
foreign countries may be subject to foreign taxes withheld at the source. The
United States has entered into tax treaties with many foreign countries that
entitle the International Equity Fund to reduced tax rates or exemptions on this
income. The effective rate of foreign tax cannot be predicted since the amount
of International Equity Fund's assets to be invested within various countries is
unknown. However, the International Equity Fund intends to operate so as to
qualify for treaty-reduced tax rates where applicable.
If more than 50% of the value of the International Equity Fund's assets at the
end of the tax year is represented by stock or securities of foreign
corporations, the International Equity Fund intends to qualify for certain
Internal Revenue Code stipulations that would allow shareholders to claim a
foreign tax credit or deduction on their U.S. income tax returns. The Internal
Revenue Code may limit a shareholder's ability to claim a foreign tax credit.
Furthermore, shareholders who elect to deduct their portion of the International
Equity Fund's foreign taxes rather than take the foreign tax credit must itemize
deductions on their income tax returns.
To the extent the Equity Fund or the Premier Fund invests in the
International Equity Fund, the shareholders of the Equity Fund and Premier Fund
will not be able to earn the foreign tax credit on investments held by the
International Equity Fund.
These tax consequences apply whether dividends are received in cash or as
additional shares. Information on the tax status of dividends and distributions
is provided annually.
State and Local Taxes
Distributions on the Tax-Free Bond Fund representing net interest received on
tax-exempt municipal securities are not necessarily free from income taxes of
any state or local taxing authority, although they may be exempt from Nebraska
personal income tax. State laws differ on this issue, and you should consult
your tax adviser for specific details regarding the status of your account under
state and local tax laws, including treatment of distributions as income or
return of capital.
Nebraska Taxes
Under existing Nebraska laws, distributions made by the Tax-Free Bond Fund will
not be subject to Nebraska income taxes to the extent that such distributions
qualify as exempt-interest dividends under the Internal Revenue Code, and
represent (i) interest from obligations of Nebraska, its political subdivisions,
authorities, commissions or instrumentalities; or (ii) interest from obligations
of the United States and its territories and possessions or of any authority,
commission, or instrumentality of the United States to the extent exempt from
state income taxes under the laws of the United States. Conversely, to the
extent that distributions made by the Tax-Free Bond Fund are attributable to
other types of obligations, such distributions will be subject to Nebraska
income taxes.
<PAGE>
Appendix
Standard and Poor's Corporate Bond Ratings
AAA--Debt rated AAA has the highest rating assigned by S&P. Capacity to pay
interest and repay principal is extremely strong.
AA--Debt rated AA has a very strong capacity to pay interest and repay principal
and differs from the higher rated issues only in small degree.
A--Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.
BBB--Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.
BB, B, CCC, CC--Debt rated BB, B, CCC and CC is regarded, on balance, as
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties of major risk exposures to adverse
conditions.
C--The rating C typically is applied to debt subordinated to senior debt
which is assigned an actual or implied "CCC-" debt rating. The C rating may be
used to cover a situation where a bankruptcy petition has been filed, but debt
service payments are continued.
D--Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. The D rating also will be used upon the
filing of a bankruptcy petition if debt service payments are jeopardized.
NR--Indicates that no public rating has been requested, that there is
insufficient information on which to base a rating, or that S&P does not rate a
particular type of obligation as a matter of policy.
Moody's Investors Service, Inc. Corporate Bond Ratings
Aaa--Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edged." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.
Aa--Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long term risks appear somewhat larger than in Aaa securities.
A--Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.
Baa--Bonds which are rated Baa are considered as medium grade obligations,
(i.e., they are neither highly protected nor poorly secured.) Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.
Ba--Bonds which are Ba are judged to have speculative elements; their future
cannot be considered as well-assured. Often the protection of interest and
principal payments may be very moderate and thereby not well safeguarded during
both good and bad times over the future. Uncertainty of position characterizes
bonds in this class.
B--Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
Caa--Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.
Ca--Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.
C--Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.
NR--Not rated by Moody's.
Fitch Investors Service, Inc. Long-Term Debt Ratings
AAA--Bonds considered to be investment grade and of the highest credit
quality. The obligor has an exceptionally strong ability to pay interest and
repay principal, which is unlikely to be affected by
reasonably foreseeable events.
AA--Bonds considered to be investment grade and of very high credit quality. The
obligor's ability to pay interest and repay principal is very strong, although
not quite as strong as bonds rated AAA.
Because bonds rated in the AAA and AA categories are not significantly
vulnerable to foreseeable future developments, short-term debt of these issuers
is generally rated F-1+.
A--Bonds considered to be investment grade and of high credit quality.
The obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
BBB--Bonds considered to be investment grade and of satisfactory credit quality.
The obligator's ability to pay interest and repay principal is considered to be
adequate. Adverse changes in economic conditions and circumstances, however, are
more likely to have adverse impact on these bonds, and therefore, impair timely
payment. The likelihood that the ratings of these bonds will fall below
investment grade is higher than for bonds with higher ratings.
BB--Bonds are considered speculative. The obligor's ability to pay interest and
repay principal may be affected over time by adverse economic changes. However,
business and financial alternatives can be identified which could assist the
obligor in satisfying its debt service requirements.
B--Bonds are considered highly speculative. While bonds in this class are
currently meeting debt service requirements, the probability of continued timely
payment of principal and interest reflects the obligor's limited margin of
safety and the need for reasonable business and economic activity throughout the
life of the issue.
CCC--Bonds have certain identifiable characteristics which, if not remedied, may
lead to default. The ability to meet obligations requires an advantageous
business and economic environment.
CC--Bonds are minimally protected. Default in payment of interest and/or
principal seems probable over time.
C--Bonds are in imminent default in payment or interest or principal.
DDD, DD, AND D--Bonds are in default on interest and/or principal payments. Such
bonds are extremely speculative and should be valued on the basis of their
ultimate recovery value in liquidation or reorganization of the obligor. "DDD"
represents the highest potential for recovery on these bonds, and "D" represents
the lowest potential for recovery.
NR--Indicates that Fitch does not rate the specific issue.
Standard and Poor's Commercial Paper Ratings
A-1--This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. The issues determined to possess
overwhelming safety characteristics are denoted with a plus (+) sign
designation. A-2--Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
Moody's Investors Services, Inc. Commercial Paper Ratings
P-1--Issuers rated PRIME-1 (for related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. PRIME-1 repayment
capacity will normally be evidenced by the following characteristics:
conservative capitalization structures with moderate reliance on debt and ample
asset protection; broad margins in earning coverage of fixed financial charges
and high internal cash generation; and well-established access to a range of
financial markets and assured sources of alternate liquidity.
P-2--Issuers rated PRIME-2 (for related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will normally
be evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.
Fitch Investors Service, Inc. Short-Term Ratings
F-1+--(Exceptionally Strong Credit Quality). Issues assigned this rating
are regarded as having the strongest degree of assurance for timely payment.
F-1--(Very Strong Credit Quality). Issues assigned to this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F-1+.
F-2--(Good Credit Quality). Issues carrying this rating have a satisfactory
degree of assurance for timely payment but the margin of safety is not as great
as the F-1+ and F-1 categories.
<PAGE>
<TABLE>
<CAPTION>
Addresses
<S> <C>
Great Plains Equity Fund Federated Investors Tower
Great Plains International Equity Fund Pittsburgh, Pennsylvania 15222-3779
Great Plains Premier Fund
Great Plains Intermediate Bond Fund
Great Plains Tax-Free Bond Fund
Distributor
Edgewood Services, Inc. Clearing Operations
P.O. Box 897
Pittsburgh, Pennsylvania 15222-3779
Adviser to all Funds
First Commerce Investors, Inc. 610 NBC Center
1248 "O" Street
Lincoln, Nebraska 68508
Sub-Adviser
Peter A. Kinney 11 S. LaSalle, #2900
Chicago, Illinois 60603
Custodian
National Bank of Commerce 1248 "O" Street
Lincoln, Nebraska 68508
Transfer Agent and Dividend Disbursing Agent
Federated Shareholder Services Company Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Administrator and Portfolio Accountant
Federated Services Company Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Shareholder Servicing Agent
Legal Counsel
Bell, Boyd & Lloyd Three First National Plaza
70 West Madison Street
Chicago, Illinois 60602
Independent Public Accountants
</TABLE>
Edgewood Services, Inc.
Distributor
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with
the Securities and Exchange Commission. These securities may not be sold
nor may any offers to buy be accepted prior to the time that the
registration statement becomes effective. This Statement of Additional
Information shall not constitute an offer to sell or the solicitation of
an offer to buy nor shall there be any sale of these securities in any
State in which such offer, solicitation, or sale would be unlawful prior
to registration or qualification under the securities laws of any such
State.
SUBJECT TO COMPLETION July 11, 1997
Great Plains Equity Fund
Great Plains Premier Fund
Great Plains International Equity Fund
Great Plains Intermediate Bond Fund
Great Plains Tax-Free Bond Fund
(Portfolios of Great Plains Funds)
Statement of Additional Information
________________, 1997
This Statement of Additional Information should be read with the
prospectus, dated ____________, 1997, for the Funds listed above. This
Statement is not a prospectus itself. You may request a copy of a
prospectus or a paper copy of this Statement, if you have received it
electronically, free of charge, by writing or calling _________________ at
__________________________.
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
EDGEWOOD SERVICES, INC.
Distributor
A subsidiary of FEDERATED INVESTORS
<PAGE>
Table of Contents
- -------------------------------------------------------------------------------
Policies and Acceptable Investments 1
Investment Limitations 6
Fundamental Limitations 6
Non-Fundamental Limitations 8
Nebraska Investment Risks 9
Great Plains Funds Management 10
Officers and Trustees 10
Fund Ownership 12
Trustees' Compensation 12
Investment Advisory Services 12
Adviser to the Funds 12
Advisory Fees 12
Sub-Adviser to International Equity Fund 12
Other Services 13
Administrative Services 13
Transfer Agent, Dividend Disbursing Agent and
Portfolio Accounting Services 13
Custodian 13
Independent Public Accountants 13
Shareholder Servicing Arrangements 13
Brokerage Transactions 13
Distribution Plan and Agreement 14
Determining Market Value 14
Market Values 14
Trading in Foreign Securities 15
Redemption in Kind 15
Massachusetts Partnership Law 15
Tax Status 16
The Funds' Tax Status 16
Foreign Taxes 16
Shareholders' Tax Status 16
Capital Gains 16
Total Return 16
Yield 17
Tax-Equivalent Yield 17
Tax-Equivalency Tables 17
Performance Comparisons 19
Economic and Market Information 21
<PAGE>
This Statement contains additional information about the Great Plains Funds
(the "Trust") and its five investment portfolios (the "Funds"). This Statement
uses the same terms as defined in the Prospectus.
Policies and Acceptable Investments
Asset-Backed Securities. Asset-Backed Securities are bonds or notes backed by
loans or accounts receivable originated by banks, or other credit providers or
financial institutions. Asset-Backed Securities may be pooled and then divided
into classes of securities, known as tranches, and resold. Each tranche has a
specified interest rate and maturity. The cash flows from the underlying pool of
Asset-Backed Securities are applied first to pay interest and then to retire
securities. All principal payments are directed first to the shortest-maturity
tranche. When those securities are completely retired, all principal payments
are then directed to the next-shortest-maturity tranche. This process continues
until all of the tranches have been completely retired. Average Maturity. For
purposes of determining the dollar-weighted average maturity of a Fund's
portfolio, the maturity of a security will be its ultimate maturity. If it is
probable that the issuer of the security will take advantage of
maturity-shortening devices such as a call, refunding, or redemption provision,
the maturity date will be the date on which it is probable that the security
will be called, refunded, or redeemed. If the security includes the right to
demand payment, the maturity of the security for purposes of determining a
Fund's dollar-weighted average portfolio maturity will be the period remaining
until the principal amount of the security can be recovered by exercising the
right to demand payment. Convertible Securities. When owned as part of a unit
along with warrants, which entitle the holder to buy the common stock,
convertible securities function as convertible bonds, except that the warrants
generally will expire before the bonds' maturity. A Fund will exchange or
convert the convertible securities held in its portfolio into shares of the
underlying common stocks when, in the Adviser's opinion, the investment
characteristics of the underlying common shares will assist the Fund in
achieving its investment objective. Otherwise, the Fund will hold or trade the
convertible securities. In evaluating these matters with respect to a particular
convertible security, the Fund's Adviser considers numerous factors, including
the economic and political outlook, the value of the security relative to other
investment alternatives, trends in the determinants of the issuer's profits, and
the issuer's management capability and practices. Derivative Contracts and
Securities. The term derivative has traditionally been applied to certain
contracts (including futures, forward, option and swap contracts) that "derive"
their value from changes in the value of an underlying security, currency,
commodity or index. Certain types of securities that incorporate the performance
characteristics of these contracts are also referred to as "derivatives." The
term has also been applied to securities "derived" from the cash flows from
underlying securities, mortgages or other obligations. Derivative contracts and
securities can be used to reduce or increase the volatility of an investment
portfolio's total performance. While the response of certain derivative
contracts and securities to market changes may differ from traditional
investments, such as stock and bonds, derivatives do not necessarily present
greater market risks than traditional investments. The Funds will only use
derivative contracts for the purposes disclosed in the applicable sections of
their Prospectus or this Statement. To the extent that a Fund invests in
securities that could be characterized as derivatives, it will only do so in a
manner consistent with its investment objective, policies, and limitations.
Duration. Duration is a commonly used measure of potential volatility in the
price of a bond, or other fixed income security, or in a portfolio of fixed
income securities, prior to maturity. Volatility is the magnitude of the change
in the price of a bond relative to a given change in the market rate of
interest. A bond's price volatility depends on three primary variables: the
bond's coupon rate; maturity date; and the level of market yields of similar
fixed income securities. Generally, bonds with lower coupons or longer
maturities will be more volatile than bonds with higher coupons or shorter
maturities. Duration combines these variables into a single measure. Duration is
calculated by dividing the sum of time-weighted values of the cash flows of a
bond or bonds, including interest and principal payments, by the sum of the
present values of the cash flows. When a Fund invests in mortgage pass-through
securities, its duration will be calculated in a manner which requires
assumptions to be made regarding future principal prepayments. A more complete
description of this calculation is available upon request from the Funds.
Foreign Currency Hedging Transactions. In order to hedge against foreign
currency exchange rate risks, the Equity Fund, International Equity Fund and
Premier Fund may enter into forward foreign currency exchange contracts and
foreign currency futures contracts, as well as purchase put or call options on
foreign currencies or currency futures transactions, as described below. The
Funds may also conduct their foreign currency exchange transactions on a spot
(i.e., cash) basis at the spot rate prevailing in the foreign currency exchange
market. The Equity Fund, International Equity Fund and Premier Fund may enter
into forward foreign currency exchange contracts ("forward contracts") to
attempt to minimize the risk to a Fund from adverse changes in the relationship
between the U.S. dollar and foreign currencies. A forward contract is an
obligation to purchase or sell a specific currency for an agreed price at a
future date which is individually negotiated and privately traded by currency
traders and their customers. A Fund may enter into a forward contract, for
example, when it enters into a contract for the purchase or sale of a security
denominated in a foreign currency in order to "lock in" the U.S. dollar price of
the security. In addition, for example, when a Fund believes that a foreign
currency may suffer a substantial decline against the U.S. dollar, it may enter
into a forward contract to sell an amount of that foreign currency approximating
the value of some or all of the Fund's portfolio securities denominated in such
foreign currency; or when a Fund believes that the U.S. dollar may suffer a
substantial decline against a foreign currency, it may enter into a forward
contract to buy that foreign currency for a fixed dollar amount. This second
investment practice is generally referred to as "cross-hedging." Because in
connection with a Fund's forward foreign currency transactions an amount of the
Fund's assets equal to the amount of the purchase will be held aside or
segregated to be used to pay for the commitment, the Fund will always have cash,
cash equivalents or high quality debt securities available sufficient to cover
any commitments under these contracts or to minimize potential risk. The
segregated account will be marked to market on a daily basis. While these
contracts are not presently regulated by the Commodity Futures Trading
Commission ("CFTC"), the CFTC may in the future assert authority to regulate
forward contracts. In such event, the Fund's ability to utilize forward
contracts in the manner set forth above may be restricted. Forward contracts may
limit potential gain from a positive change in the relationship between the U.S.
dollar and foreign currencies. Unanticipated changes in currency prices may
result in poorer overall performance for the Fund than if it had not engaged in
such contracts. The Equity Fund, International Equity Fund and Premier Fund may
purchase and write put and call options on foreign currencies for the purpose of
protecting against declines in the dollar value of foreign portfolio securities
and against increases in the dollar cost of foreign securities to be acquired.
As is the case with other kinds of options, however, the writing of an option on
foreign currency will constitute only a partial hedge, up to the amount of the
premium received, and a Fund could be required to purchase or sell foreign
currencies at disadvantageous exchange rates, thereby incurring losses. The
purchase of an option on foreign currency may constitute an effective hedge
against fluctuation in exchange rates, although, in the event of rate movements
adverse to the Fund's position, the Fund may forfeit the entire amount of the
premium plus related transaction costs. Options on foreign currencies to be
written or purchased by a Fund will be traded on U.S. and foreign exchanges or
over-the-counter. The Equity Fund, International Equity Fund and Premier Fund
may enter into exchange-traded contracts for the purchase or sale for future
delivery of foreign currencies ("foreign currency futures") and may purchase and
write put and call options on foreign currency futures. This investment
technique will be used only to hedge against anticipated future changes in
exchange rates which otherwise might adversely affect the value of a Fund's
portfolio securities or adversely affect the prices of securities that the Fund
intends to purchase at a later date. The successful use of foreign currency
futures will usually depend on the ability of a Fund's Adviser and Sub-Adviser
to forecast currency exchange rate movements correctly. Should exchange rates
move in an unexpected manner, the Fund may not achieve the anticipated benefits
of foreign currency futures or may realize losses.
"Margin" In Futures Transactions. Unlike the purchase or sale of a
security, the Equity Fund, International Equity Fund and Premier Fund do
not pay or receive money upon the purchase or sale of a futures contract.
Rather, the Fund is required to deposit an amount of "initial margin" in
cash, U.S. government securities or highly-liquid debt securities with
its custodian (or the broker, if legally permitted). The nature of
initial margin in futures transactions is different from that of margin
in securities transactions in that initial margin in futures transactions
does not involve the borrowing of funds by the Fund to finance the
transactions. Initial margin is in the nature of a performance bond or
good faith deposit on the contract which is returned to the Fund upon
termination of the futures contract, assuming all contractual obligations
have been satisfied. A futures contract held by the Equity Fund,
International Equity Fund and Premier Fund is valued daily at the
official settlement price of the exchange on which it is traded. Each day
a Fund pays or receives cash, called "variation margin," equal to the
daily change in value of the futures contract. This process is known as
"marking to market." Variation margin does not represent a borrowing or
loan by the Fund but is instead settlement between the Fund and the
broker of the amount one would owe the other if the futures contract
expired. In computing its daily net asset value, the Fund will mark to
market its open futures positions. The Fund is also required to deposit
and maintain margin when it writes call options on futures contracts.
When the Fund purchases futures contracts, an amount of cash and cash
equivalents, equal to the underlying commodity value of the futures
contracts (less any related margin deposits), will be deposited in a
segregated account with the Fund's custodian (or the broker, if legally
permitted) to collateralize the position and thereby insure that the use
of such futures contracts is unleveraged. To the extent required to
comply with CFTC Regulation 4.5 and thereby avoid status as a "commodity
pool operator," the Equity Fund, International Equity Fund and Premier
Fund will not enter into a futures contract for other than bona fide
hedging purposes, or purchase an option thereon, if immediately
thereafter the initial margin deposits for futures contracts held by it,
plus premiums paid by it for open options on futures contracts, would
exceed 5% of the market value of a Fund's net assets, after taking into
account the unrealized profits and losses on those contracts it has
entered into; and, provided further, that in the case of an option that
is in-the-money at the time of purchase, the in-the-money amount may be
excluded in computing such 5%. Second, the Funds will not enter into
these contracts for speculative purposes; rather, these transactions are
entered into only for bona fide hedging purposes, or other permissible
purposes pursuant to regulations promulgated by the CFTC. Third, since
the Funds do not constitute a commodity pool, they will not market
themselves as such, nor serve as a vehicle for trading in the commodities
futures or commodity options markets. Finally, because the Funds will
submit to the CFTC special calls for information, the Funds will not
register as commodities pool operators. Limitation on Open Futures
Positions. The Equity Fund, International Equity Fund and Premier Fund
will not maintain open positions in futures contracts they have sold or
call options they have written on futures contracts if, in the aggregate,
the value of the open positions (marked to market) exceeds the current
market value of their respective securities portfolio plus or minus the
unrealized gain or loss on those open positions, adjusted for the
correlation of volatility between the hedged securities and the futures
contracts. If this limitation is exceeded at any time, the Funds will
take prompt action to close out a sufficient number of open contracts to
bring their respective open futures and options positions within this
limitation. Risks. When the Equity Fund, International Equity Fund and
Premier Fund use futures and options on futures as hedging devices, there
is a risk that the prices of the securities or foreign currency subject
to the futures contracts may not correlate perfectly with the prices of
the securities or currency in that Fund's portfolio. This may cause the
futures contract and any related options to react differently to market
changes than the portfolio securities or foreign currency. In addition, a
Fund's Adviser or Sub-Adviser could be incorrect in its expectations
about the direction or extent of market factors such as stock price
movements or foreign currency exchange rate fluctuations. In these
events, a Fund may lose money on the futures contract or option. It is
not certain that a secondary market for positions in futures contracts or
for options will exist at all times. Although the Adviser will consider
liquidity before entering into these transactions, there is no assurance
that a liquid secondary market on an exchange or otherwise will exist for
any particular futures contract or option at any particular time. The
Funds' ability to establish and close out futures and options positions
depends on this secondary market. The inability to close these positions
could have an adverse effect on the Funds' ability to hedge their
respective portfolios.
Lending of Portfolio Securities. The collateral received when a Fund lends
portfolio securities must be valued daily and, should the market value of the
loaned securities increase, the borrower must furnish additional collateral to
the Fund. During the time portfolio securities are on loan, the borrower pays
the Fund any dividends or interest paid on such securities. Loans are subject to
termination at the option of the Fund or the borrower. The Fund may pay
reasonable administrative and custodial fees in connection with a loan and may
pay a negotiated portion of the interest earned on the cash or equivalent
collateral to the borrower or placing broker. If the Fund does not have the
right to vote securities on loan, it would terminate the loan and regain the
right to vote if that were considered important with respect to the investment.
Mortgage-Backed Securities. The following is additional information about
Mortgage-Backed Securities.
Collateralized Mortgage Obligations ("CMOs"). The following example
illustrates how mortgage cash flows are prioritized in the case of CMOs -
most of the CMOs in which the Intermediate Bond Fund invests use the same
basic structure: (1) Several classes of securities are issued against a
pool of mortgage collateral. A common structure may contain four classes
of securities. The first three (A, B, and C bonds) pay interest at their
stated rates beginning with the issue date, and the final class (Z bond)
typically receives any excess income from the underlying investments
after payments are made to the other classes and receives no principal or
interest payments until the shorter maturity classes have been retired,
but then receives all remaining principal and interest payments; (2) The
cash flows from the underlying mortgages are applied first to pay
interest and then to retire securities; (3) The classes of securities are
retired sequentially. All principal payments are directed first to the
shortest-maturity class (or A bond). When those securities are completely
retired, all principal payments are then directed to the next
shortest-maturity security (or B bond). This process continues until all
of the classes have been paid off. Because the cash flow is distributed
sequentially instead of pro rata, as with pass-through securities, the
cash flows and average lives of CMOs are more predictable, and there is a
period of time during which the investors in the longer-maturity classes
receive no principal paydowns. The interest portion of these payments is
distributed by the Fund as income, and the capital portion is reinvested.
Municipal Securities. Examples of Municipal Securities include, but are not
limited to: tax and revenue anticipation notes ("TRANs") issued to finance
working capital needs in anticipation of receiving taxes or other revenues; tax
anticipation notes ("TANs") issued to finance working capital needs in
anticipation of receiving taxes; revenue anticipation notes ("RANs") issued to
finance working capital needs in anticipation of receiving revenues; bond
anticipation notes ("BANs") that are intended to be refinanced through a later
issuances of longer-term bonds; municipal commercial paper and other short-term
notes; variable rate demand notes; municipal bonds (including bonds having
serial maturities and pre-refunded bonds) and leases; construction loan notes
insured by the Federal Housing Administration and financed by the Federal or
Government National Mortgage Associations; and participation, trust and
partnership interests in any of the foregoing obligations. Although an emphasis
will be placed on purchasing Nebraska Municipal Securities, the Tax-Free Bond
Fund's investments may consist of issues of Municipal Securities representative
of various areas of the U.S. and general obligations of states, cities and
school districts as well as some revenue issues which meet the Fund's acceptable
quality criteria.
Municipal Leases. The Intermediate Bond Fund and the Tax-Free-Bond Fund
may purchase Municipal Securities in the form of participation interests
that represent an undivided proportional interest in lease payments by a
governmental or nonprofit entity. The lease payments and other rights
under the lease provide for and secure payments on the certificates.
Lease obligations may be limited by municipal charter or the nature of
the appropriation for the lease. In particular, lease obligations may be
subject to periodic appropriation. If the entity does not appropriate
funds for future lease payments, the entity cannot be compelled to make
such payments. Furthermore, a lease may provide that the participants
cannot accelerate lease obligations upon default. The participants would
only be able to enforce lease payments as they became due. In the event
of a default or failure of appropriation, unless the participation
interests are credit enhanced, it is unlikely that the participants would
be able to obtain an acceptable substitute source of payment. Under the
criteria currently established by the Trustees, the Funds' Adviser must
consider the following factors in determining the liquidity of municipal
lease securities: (1) the frequency of trades and quotes for the
security; (2) the volatility of quotations and trade prices for the
security; (3) the number of dealers willing to purchase or sell the
security and the number of potential purchasers; (4) dealer undertakings
to make a market in the security; (5) the nature of the security and the
nature of the marketplace trades; (6) the rating of the security and the
financial condition and prospects of the issuer of the security; (7) such
other factors as may be relevant to the Funds' ability to dispose of the
security; (8) whether the lease can be terminated by the lessee; (9) the
potential recovery, if any, from a sale of the leased property upon
termination of the lease; (10) the lessee's general credit strength; (11)
the likelihood that the lessee will discontinue appropriating funding for
the leased property because the property is no longer deemed essential to
its operations; and (12) any credit enhancement or legal recourse
provided upon an event of nonappropriation or other termination of the
lease. Variable Rate Municipal Securities. Variable interest rates
generally reduce changes in the market value of Municipal Securities from
their original purchase prices. Accordingly, as interest rates decrease
or increase, the potential for capital appreciation or depreciation is
less for variable rate Municipal Securities than for fixed income
obligations. Many Municipal Securities with variable interest rates
purchased by a Fund are subject to repayment of principal (usually within
seven days) on the Fund's demand. For purposes of determining the Funds'
average maturity, the maturities of these variable rate demand Municipal
Securities (including participation interests) are the longer of the
periods remaining until the next readjustment of their interest rates or
the periods remaining until their principal amounts can be recovered by
exercising the right to demand payment. The terms of these variable rate
demand instruments require payment of principal and accrued interest from
the issuer of the municipal obligations, the issuer of the participation
interests, or a guarantor of either issuer.
Municipal Bond Insurance. The Intermediate Bond Fund and Tax-Free Bond Fund may
purchase municipal securities covered by insurance which guarantees the timely
payment of principal at maturity and interest on such securities ("Policy" or
"Policies"). These insured municipal securities are either (1) covered by an
insurance policy applicable to a particular security, whether obtained by the
issuer of the security or by a third party ("Issuer-Obtained Insurance") or (2)
insured under master insurance policies issued by municipal bond insurers, which
may be purchased by the Funds. The premiums for the Policies may be paid by the
Funds and the yield on the Funds' portfolios may be reduced thereby.
The Funds may require or obtain municipal bond insurance when purchasing
municipal securities which would not otherwise meet the Funds' quality
standards. The Funds may also require or obtain municipal bond insurance when
purchasing or holding specific municipal securities, when, in the opinion of the
Funds' Adviser, such insurance would benefit the Funds (for example, through
improvement of portfolio quality or increased liquidity of certain securities).
Issuer-Obtained Insurance policies are noncancellable and continue in force as
long as the municipal securities are outstanding and their respective insurers
remain in business. If a municipal security is covered by Issuer-Obtained
Insurance, then such security need not be insured by the Policies purchased by a
Fund.
The Funds may purchase two types of Policies issued by municipal bond insurers.
One type of Policy covers certain municipal securities only during the period in
which they are in the Funds' portfolio. In the event that a municipal security
covered by such a Policy is sold from a Fund, the insurer of the relevant Policy
will be liable for those payments of interest and principal which are due and
owing at the time of the sale.
The other type of Policy covers municipal securities not only while they remain
in the Funds' portfolio but also until their final maturity if they are sold out
of the Funds' portfolio, so that the coverage may benefit all subsequent holders
of those municipal securities. The Funds will obtain insurance which covers
municipal securities until final maturity even after they are sold out of the
Funds' portfolio only if, in the judgment of the Adviser, the Funds would
receive net proceeds from the sale of those securities, after deducting the cost
of such permanent insurance and related fees, in excess of the proceeds the
Funds would receive if such municipal securities were sold without insurance.
Payments received from municipal bond insurers may not be tax-exempt income to
shareholders of the Funds.
The Funds may purchase municipal securities insured by Policies from MBIA Corp.
("MBIA"), AMBAC Indemnity Corporation ("AMBAC"), Financial Guaranty Insurance
Company ("FGIC"), or any other municipal bond insurer which is rated AAA by S&P
or Aaa by Moody's. Each Policy guarantees the payment of principal and interest
on those municipal securities it insures. The Policies will have the same
general characteristics and features. A municipal security will be eligible for
coverage if it meets certain requirements set forth in the Policy. In the event
interest or principal on an insured municipal security is not paid when due, the
insurer covering the security will be obligated under its Policy to make such
payment not later than 30 days after it has been notified by a Fund that such
non-payment has occurred. MBIA, AMBAC, and FGIC will not have the right to
withdraw coverage on securities insured by their Policies so long as such
securities remain in the Funds' portfolio, nor may MBIA, AMBAC, or FGIC cancel
their Policies for any reason except failure to pay premiums when due.
MBIA, AMBAC, and FGIC will reserve the right at any time upon 90 days' written
notice to the Funds to refuse to insure any additional municipal securities
purchased by the Funds after the effective date of such notice. The Funds
reserve the right to terminate any of the Policies if they determine that the
benefits to a Fund of having its portfolio insured under such Policy are not
justified by the expense involved.
Additionally, the Funds reserve the right to enter into contracts with insurance
carriers other than MBIA, AMBAC, or FGIC if such carriers are rated AAA by S&P
or Aaa by Moody's.
Repurchase Agreements. Each Fund requires its custodian to take possession of
the securities subject to repurchase agreements and these securities are marked
to market daily. To the extent that the original seller does not repurchase the
securities from a Fund, the Fund could receive less than the repurchase price on
any sale of such securities. In the event that such a defaulting seller files
for bankruptcy or becomes insolvent, disposition of such securities by the Fund
might be delayed pending court action. The Funds believe that, under the regular
procedures normally in effect for custody of the portfolio securities subject to
repurchase agreements, a court of competent jurisdiction would rule in favor of
the Funds and allow retention or disposition of such securities. The Funds will
only enter into repurchase agreements with banks and other recognized financial
institutions, such as broker/dealers, which are deemed by a Fund's Adviser [or
Sub-Adviser] to be creditworthy pursuant to guidelines established by the
Trustees. Restricted Securities. The Funds may invest in commercial paper issued
in reliance on the exemption from restriction afforded by Section 4(2) of the
Securities Act of 1933. Section 4(2) commercial paper is restricted as to
disposition under federal securities law and is generally sold to institutional
investors, such as the Funds, who agree that they are purchasing the paper for
investment purposes and not with a view to public distribution. Any resale by
the purchaser must be in an exempt transaction. Section 4(2) commercial paper is
normally resold to other institutional investors like the Funds through or with
the assistance of the issuer or investment dealers who make a market in Section
4(2) commercial paper, thus providing liquidity. The Funds believe that Section
4(2) commercial paper and possibly certain other restricted securities which
meet the criteria for liquidity established by the Trustees are quite liquid.
The Funds intend, therefore, to treat the restricted securities which meet the
criteria for liquidity established by the Trustees, including Section 4(2)
commercial paper (as determined by a Fund's Adviser [or Sub-Adviser]), as liquid
and not subject to the investment limitation applicable to illiquid securities.
In addition, because Section 4(2) commercial paper is liquid, the Funds intend
to not subject such paper to the limitation applicable to restricted securities.
Reverse Repurchase Agreements. Each Fund may enter into reverse repurchase
agreements. This transaction is similar to borrowing cash. In a reverse
repurchase agreement, the Fund transfers possession of a portfolio instrument to
another person, such as a financial institution, broker, or dealer, in return
for a percentage of the instrument's market value in cash, and agrees that on a
stipulated date in the future the Fund will repurchase the portfolio instrument
by remitting the original consideration plus interest at an agreed upon rate.
The use of reverse repurchase agreements may enable the Fund to avoid selling
portfolio instruments at a time when a sale may be deemed to be disadvantageous,
but the ability to enter into reverse repurchase agreements does not ensure that
the Fund will be able to avoid selling portfolio instruments at a
disadvantageous time. When effecting reverse repurchase agreements, liquid
assets of the Fund, in a dollar amount sufficient to make payment for the
obligations to be purchased, are segregated at the trade date. These securities
are marked to market daily and maintained until the transaction is settled.
When-Issued and Delayed Delivery Transactions. These transactions are made to
secure what is considered to be an advantageous price or yield for the Funds.
Settlement dates may be a month or more after entering into these transactions,
and the market values of the securities purchased may vary from the purchase
prices. No fees or other expenses, other than normal transaction costs, are
incurred. However, liquid assets of a Fund sufficient to make payment for the
securities to be purchased are segregated on a Fund's records at the trade date.
These assets are marked to market daily and are maintained until the transaction
has been settled.
Investment Limitations
Fundamental Limitations
The following investment limitations are fundamental and cannot be changed
without shareholder approval except that no investment limitation of the Fund
shall prevent the Fund from investing substantially all of its assets (except
for assets which are not considered "investment securities" under the Investment
Company Act of 1940, or assets exempted by the SEC) in an open end investment
company with substantially the same investment objective.
Selling Short and Buying on Margin
Except for the Equity Fund, International Equity Fund and Premier Fund, none of
the other Funds will sell any securities short or purchase any securities on
margin, but may obtain such short-term credits as may be necessary for clearance
of purchases and sales of portfolio securities. A deposit or payment by a Fund
of initial or variation margin in connection with futures contracts, forward
contracts or related options transactions is not considered the purchase of a
security on margin.
Issuing Senior Securities and Borrowing Money
The Funds will not issue senior securities except that each Fund may borrow
money, directly or through reverse repurchase agreements, in amounts up to
one-third of the value of its total assets including the amounts borrowed; and
except to the extent that a Fund is permitted to enter into futures contracts,
options or forward contracts. A Fund will not borrow money or engage in reverse
repurchase agreements for investment leverage, but rather as a temporary,
extraordinary, or emergency measure or to facilitate management of its portfolio
by enabling the Fund to meet redemption requests when the liquidation of
portfolio securities is deemed to be inconvenient or disadvantageous. A Fund
will not purchase any securities while any borrowings in excess of 5% of its
total assets are outstanding.
Pledging Assets
The Funds will not mortgage, pledge, or hypothecate any assets except to secure
permitted borrowings. In those cases, each Fund may pledge assets having a
market value not exceeding the lesser of the dollar amounts borrowed or
one-third of the value of its total assets at the time of the pledge. For
purposes of this limitation, the following are not deemed to be pledges: margin
deposits for the purchase and sale of futures contracts and related options; and
segregation of collateral arrangements made in connection with options
activities, forward contracts or the purchase of securities on a when-issued or
delayed delivery basis.
Lending Cash or Securities
The Funds will not lend any of their assets except portfolio securities. Loans
may not exceed one-third of the value of a Fund's total assets. This shall not
prevent a Fund from purchasing or holding U.S. government obligations, money
market instruments, variable rate demand notes, bonds, debentures, notes,
certificates of indebtedness, or other debt securities, entering into repurchase
agreements, or engaging in other transactions where permitted by a Fund's
investment objective, policies, and limitations.
Investing in Commodities
The Funds will not purchase or sell commodities, commodity contracts, or
commodity futures contracts. However, each Fund may purchase and sell futures
contracts and related options and enter into forward contracts and
related options.
Investing in Real Estate
The Funds will not purchase or sell real estate, although a Fund may invest in
the securities of companies whose business involves the purchase or sale of real
estate or in securities which are secured by real estate or which represent
interests in real estate.
Diversification of Investments
With respect to securities comprising 75% of the value of its total assets, the
Intermediate Bond Fund will not purchase securities issued by any one issuer
(other than cash, cash items, securities of other investment companies, or
securities issued or guaranteed by the government of the United States or its
agencies or instrumentalities and repurchase agreements collateralized by such
securities) if as a result more than 5% of the value of its total assets would
be invested in the securities of that issuer or if it would own more than 10% of
the outstanding voting securities of such issuer.
Concentration of Investments
Each Fund will not invest 25% or more of the value of its total assets in any
one industry. Each Fund may invest 25% or more of the value of its total assets
in cash or cash items, securities of other investment companies, securities
issued or guaranteed by the U.S. government, its agencies, or instrumentalities,
and repurchase agreements collateralized by such securities. In addition, the
Tax-Free Bond Fund may invest more than 25% of the value of its total assets in
obligations issued by any state, territory, or possession of the United States,
the District of Columbia or any of their authorities, agencies,
instrumentalities or political subdivisions, including tax-exempt project notes
guaranteed by the U.S. government, regardless of the location of the issuing
municipality. This policy applies to securities which are related in such a way
that an economic, business, or political development affecting one security
would also affect the other securities (such as securities paid from revenues
from selected projects in transportation, public works, education, or housing).
Underwriting
A Fund will not underwrite any issue of securities, except as it may be deemed
to be an underwriter under the Securities Act of 1933 in connection with the
sale of restricted securities which the Fund may purchase pursuant to its
investment objective, policies and limitations.
Non-Fundamental Limitations
The following investment limitations are non-fundamental and, therefore, may be
changed by the Trustees without shareholder approval except that no investment
limitation of the Fund shall prevent the Fund from investing substantially all
of its assets (except for assets which are not considered "investment
securities" under the Investment Company Act of 1940, or assets exempted by the
SEC) in an open end investment company with substantially the same investment
objective. . Shareholders will be notified before any material change in these
limitations becomes effective.
Investing in Illiquid and Restricted Securities
The Funds will invest in illiquid and restricted securities. However, the Funds
will not invest more than 15% of the value of their net assets in illiquid
securities, including repurchase agreements providing for settlement in more
than seven days after notice, non-negotiable fixed time deposits with maturities
over seven days, over-the-counter options, guaranteed investment contracts, and
certain securities not determined by the Trustees to be liquid (including
certain municipal leases).
Purchasing Securities to Exercise Control
The Funds will not purchase securities of a company for the purpose of
exercising control.
Investing in Options
The Equity Fund, International Equity Fund and Premier Fund will not purchase
put options or write call options on securities (other than options on
currencies) unless the securities are held in the Funds' portfolio or unless the
Funds are entitled to them in deliverable form without further payment or have
segregated cash in the amount of any further payment. Except with respect to
borrowing money, if a percentage limitation is adhered to at the time of
investment, a later increase or decrease in percentage resulting from any change
in value or net assets will not result in a violation of such restriction. For
purposes of its policies and limitations, the Funds consider instruments (such
as certificates of deposit and demand and time deposits) issued by a U.S. branch
of a domestic bank or savings and loan having capital, surplus, and undivided
profits in excess of $100,000,000 at the time of investment to be "cash items."
<PAGE>
Nebraska Investment Risks
The Tax-Free Bond Fund may invest in obligations of Nebraska (the "State")
issuers which result in the Fund's performance being subject to risks associated
with the overall conditions present within the State. The following information
is a general summary of the State's financial condition and a brief summary of
the prevailing economic conditions. This information is based on various sources
that are believed to be reliable but should not be considered as a complete
description of all relevant information.
[ADVISER TO UPDATE FOR 1996]
The Tax-Free Bond Fund's investment emphasis on debt obligations of the State of
Nebraska carries a higher risk than a portfolio that is geographically
diversified. There are 93 counties and 535 incorporated municipalities in
Nebraska, many of which may have outstanding debt. A number of other public
authorities and private, nonprofit organizations, including utilities, also
issue tax exempt debt within the State of Nebraska.
Economy. The economy of the State of Nebraska continues to demonstrate
relatively strong performance, with estimated personal income for 1995 at
$21,703. Total State employment was 869,000 in 1995, with the majority of jobs
in trade, services and government. Unemployment was 2.6% in 1995, compared to a
national average of 5.6%. The State's population in 1990 was 1,578,385, with
1,637,112 estimated for 1995. Two-fifths of the population is concentrated in
the three metropolitan areas of Lincoln, Omaha and South Sioux City.
Debt. The State of Nebraska does not issue debt. Local governments issue three
basic types of debt, with varying degrees of credit risk: general obligation
bonds backed by the unlimited, and in some cases limited, taxing power of the
issuer, revenue bonds secured by specific pledged fees or charges for a related
project, and tax-exempt lease obligations, secured by annual appropriations by
the issuer, usually with no implied tax or specific revenue appropriations by
the issuer. In 1995, $849 million in municipal debt was issued in Nebraska, with
approximately 25% representing general obligation debt and 75% revenue bonds,
compared to 38% general obligation and 62% revenue backed bonds nationally.
Many agencies and other instrumentalities of the State government are authorized
to borrow money under legislation which expressly provides that the loan
obligations shall not be deemed to constitute a debt or pledge of the faith and
credit of the State of Nebraska. Representative issuers of this kinds of debt
include the Nebraska Educational Facilities Authority and Nebraska Investment
Finance Authority. The principal of and interest on bonds issued by these bodies
are payable solely from various sources, principally fees generated from the use
of the facilities, enterprises financed by the bonds, or other dedicated fees.
Financial. To a large degree, the risk of the Tax-Free Bond Fund is dependent
upon the financial strength of the State of Nebraska and its political
subdivisions. Agriculture traditionally has been the backbone of Nebraska's
economy, although its strength has diminished in the last two decades compared
to other sectors. Its continued importance to the State's economy was clearly
demonstrated in recent years, when increasing farm credit problems and adverse
weather conditions affected other sectors interacting with agriculture. These
sectors include manufacturers of farm equipment and supplies; feed, seed, and
other farm supply retailers; truckers transporting farm products; and banks
providing loans for farm operating capital. While Nebraska has not experienced
severe symptoms of past national recessions, the State has faced budget crises
in the recent past (see Property Tax System below).
Property Tax System. The passage of certain legislation relating to personal
property taxes by the Nebraska Legislature and a recent challenge of the current
taxation system make it difficult to predict what the effect will be on the
ability of political subdivisions in the State to levy and collect ad valorem
taxes to support their governmental operations. These concerns were initiated by
litigation involving railroad rolling stock, the taxation of which is governed
by the provisions of the Federal Railroad Revitalization and Regulatory Reform
Act (the "4-R Act"). As a result of the successful challenge by the railroad of
personal property taxes levied on railroad rolling stock, further challenges to
personal property taxes levied on pipelines and other interstate businesses with
personal property in Nebraska were filed and ultimately raised the issue of the
validity of Nebraska's system of personal property taxation under the provisions
of Article VIII. Section 1 of the Nebraska Constitution requiring that taxes be
"levied uniformly and proportionately upon all tangible property and
franchises."
In order to resolve the constitutional issues raised by a number of lawsuits,
the 1992 Nebraska Legislature submitted an amendment to Article VIII, Section 1
of the Nebraska Constitution ("Amendment 1") allowing the exemption of certain
classes of personal property from taxation and the taxation of nonexempted
personal property at depreciated cost to the electors of the State of Nebraska
at the May 12, 1992 primary election. The Constitutional amendment was approved
by the required number of voters and has been effective since June 8, 1992. As a
result of the adoption of Amendment 1, the Legislature has exempted certain
classes of tangible personal property from taxation and concern over the
validity of the State's property taxation system has been reduced. The 1992
Nebraska Legislature also passed, during a special session following the
approval of Amendment 1, Legislative Bill 1 containing revisions to the Nebraska
statutes concerning the levy and collection of property taxes and taxing all
depreciable income-producing personal property at its net book value beginning
in tax year 1992.
Both Amendment 1 and Legislative Bill 1, as enacted, were recently challenged in
Lancaster County District Court as unconstitutional because they create ad
valorem taxes that are not uniform nor proportionate. Boettcher v. State,
494-102. The case was dismissed on May 30, 1995 based upon lack of jurisdiction,
but the plaintiffs have appealed such dismissal. The Nebraska Supreme Court
removed the case from the docket of the Nebraska Court of Appeals and assumed
jurisdiction. Briefs in the case were filed in December, 1995 and argument
before the Supreme Court is not expected earlier than June, 1997. [RELEVANT?]
[Puerto Rico. From time to time the Tax-Free Bond Fund may invest in obligations
of the Commonwealth of Puerto Rico and its public corporations exempt from
federal and Nebraska state and local income taxes. The majority of the
Commonwealth's debt is issued by ten of the major public agencies that are
responsible for many of the islands' public functions, such as water,
wastewater, highways, telecommunications, education, and public construction.
Since the 1980's, Puerto Rico's economy and financial operations have paralleled
the economic cycles of the United States. The island's economy, particularly the
manufacturing sector, has experienced substantial gains in employment.
Unemployment, while reaching its lowest level in ten years, still remains high.
Much of these economic gains are attributable in part to favorable treatment
under Section 936 of the U.S. Federal Tax Code for U.S. corporations doing
business in Puerto Rico.
Debt ratios for the Commonwealth are high as it assumes much of the
responsibility for local infrastructure. Sizable infrastructure improvements are
anticipated to upgrade the island's water, sewer, and road system. The
Commonwealth's general obligation debt is secured by a first lien on all
available revenues.
The Commonwealth's economy remains vulnerable to changes in oil prices,
American trade, foreign policy, and levels of federal assistance. Per capita
income levels, while the highest in the Caribbean, lag for behind
the United States.]
Other Risk Factors. Because of its investment policies, the Tax-Free Bond Fund
may not be suitable or appropriate for all investors. The Fund is designed for
investors who want a high level of current income that is exempt from federal
and Nebraska state income taxes. Investors in the Fund should not rely on the
Fund for their short-term financial needs. The principal values of longer term
securities fluctuate more widely in response to changes in interest rates than
those of shorter term securities, providing greater opportunity for capital gain
or risk of capital loss.
There can be no assurance that the Tax-Free Bond Fund will achieve its
investment objective. Yields on Municipal Securities are dependent on a variety
of factors, including the general conditions of the money market and the
municipal bond market, the size of a particular offering, the maturity of the
obligation, and the rating of the issue. Municipal Securities with longer
maturities tend to produce higher yields and are generally subject to
potentially greater capital appreciation and depreciation than obligations with
shorter maturities and lower yields. The market prices of Municipal Securities
usually vary, depending upon available yields. An increase in interest rates
will generally reduce the value of Fund investments, and a decline in interest
rates will generally increase the value of Fund investments. The ability of the
Fund to achieve its investment objective is also dependent on the continuing
ability of the issuers of Municipal Securities to meet their obligations for the
payment of interest and principal when due. The ratings of Moody's and S&P
represent their opinions as to the quality of Municipal Securities which they
undertake to rate. Ratings are not absolute standards of quality; consequently,
Municipal Securities with the same maturity, coupon, and rating may have
different yields. There are variations in Municipal Securities, both within a
particular classification and between classifications, depending on numerous
factors. It should also be pointed out that, unlike other types of investments,
Municipal Securities have traditionally not been subject to regulation by, or
registration with, the Securities and Exchange Commission, although there have
been proposals which would provide for regulation in the future. The federal
bankruptcy statutes relating to the debts of political subdivisions and
authorities of states of the United States provide that, in certain
circumstances, such subdivisions or authorities may be authorized to initiate
bankruptcy proceedings without prior notice to or consent of creditors, which
proceedings could result in material and adverse changes in the rights of
holders of their obligations. Proposals have been introduced in Congress to
restrict or eliminate the federal income tax exemption for interest on Municipal
Securities, and similar proposals may be introduced in the future. Some of the
past proposals would have applied to interest on Municipal Securities issued
before the date of enactment, which would have adversely affected their value to
a degree. If such a proposal were enacted, the availability of Municipal
Securities for investment by the Fund and the value of each Fund's investments
would be affected and, in such an event, the Fund would reevaluate its
investment objectives and policies. The Tax-Free Bond Fund's investment emphasis
on securities issued by municipalities and political subdivisions of the State
of Nebraska involves greater risk than investing in Municipal Securities issued
by a diversified group of entities from various geographical areas in the United
States. Specifically, the credit quality of the Fund will depend upon the
continued financial strength of the public bodies and municipalities in
Nebraska. The State of Nebraska does not issue debt and, as a result, the
financial condition of each municipality or political subdivision for each issue
must be analyzed separately. Nebraska Municipal Securities generally have been
highly regarded. Defaults on Nebraska Municipal Securities have been confined to
issues made by sanitary improvement districts primarily occurring in the early
1980's and a few of the industrial development bond issues also occurring in the
early 1980's. The Tax-Free Bond Fund expects to invest a substantial portion of
its assets in the debt obligations of local governments and public authorities
in the State of Nebraska. While local governments in Nebraska are predominantly
reliant on independent revenue sources, such a property taxes, they are not
immune to budget shortfalls caused by cut-backs in state aid. None of the
obligations issued by public authorities in Nebraska are backed by the full
faith and credit of the State of Nebraska. In addition, property tax increases
and general increases in governmental sending may be subject to voter approval.
The Tax-Free Bond Fund may also invest in certain sectors of the municipal
securities market which have unique risks. The sectors include, but are not
limited to, investments in issuances of health care providers, electric revenue
issues with exposure to nuclear power plants, and private activity bonds without
governmental backing. Each of these sectors is impacted by its own unique set of
circumstances, including significant regulator impacts, which may adversely
affect an issuer's financial performance. Over 25% of the Nebraska Municipal
Securities in the Tax-Free Bond Fund's portfolio may be health care revenue
bonds. Ratings of bonds issued for health care facilities are sometimes based on
feasibility studies that contain projections of occupancy levels, revenues and
expenses. A facility's gross receipts and net income available for debt service
may be affected by future events and conditions including among other things,
demand for services, the ability of the facility to provide the services
required, physicians' confidence in the facility, management capabilities,
competition with other hospitals, efforts by insurers and governmental agencies
to limit rates, legislation establishing state rate- setting agencies, expenses,
government regulation, the cost and possible unavailability of malpractice
insurance and the termination of restriction of governmental financial
assistance, including that associated with Medicare, Medicaid and other similar
third party payor programs. Pursuant to recent federal legislation, Medicare
reimbursements are currently calculated on a prospective basis utilizing a
single nationwide schedule of rates. Prior to such legislation Medicare
reimbursements were based on the actual costs incurred by the health facility.
The current legislation may adversely affect reimbursements to hospitals and
other facilities for services provided under the Medicare program.
Over 25% of the Nebraska Municipal Securities in the Tax-Free Bond Fund's
portfolio may derive their payment from mortgage loans. Certain of the Nebraska
Municipal Securities in the Fund's portfolio may be single family mortgage
revenue bonds, which are issued for the purpose of acquiring from originating
financial institutions notes secured by mortgages on residences located within
the issuer's boundaries and owned by persons of low or moderate income. Mortgage
loans are generally partially or completely prepaid prior to their final
maturities as a result of events such as sale of the mortgaged premises,
default, condemnation or casualty loss. Because these bonds are subject to
extraordinary mandatory redemption in whole or in part from such prepayments of
mortgage loans, a substantial portion of such bonds will probably be redeemed
prior to their scheduled maturities or even prior to their ordinary call dates.
The redemption price of such issues may be more or less than the offering price
of such bonds. Extraordinary mandatory redemption without premium could also
result from the failure of the originating financial institutions to make
mortgage loans in sufficient amounts within a specified time period or, in some
cases, from the sale by the bond issuer of the mortgage loans. Failure of the
originating financial institutions to make mortgage loans would be due
principally to the interest rates on mortgage loans funded from other sources
becoming competitive with the interest rates on the mortgage loans funded with
the proceeds of the single family mortgage revenues available for the payment of
the principal of or interest on such mortgage revenue bonds. Single family
mortgage revenue bonds issued after December 31, 1980, were issued under Section
103A of the Internal Revenue Code, which Section contains certain ongoing
requirements relating to the use of the proceeds of such bonds in order for the
interest on such bonds to retain its tax-exempt status. In each case, the issuer
of the bonds has covenanted to comply with applicable ongoing requirements, and
bond counsel to such issuer has issued an opinion that the interest on the bonds
is exempt from federal income tax under existing laws and regulations. There can
be no assurances that the ongoing requirements will be met. The failure to meet
these requirements could cause the interest on the bonds to become taxable,
possibly retroactively from the date of issuance.
Certain of the Nebraska Municipal Securities in the Tax-Free Bond Fund's
portfolio may be obligations of issuers whose revenues are primarily derived
from mortgage loans to housing projects for low to moderate income families. The
ability of such issuers to make debt service payments will be affected by events
and conditions affecting financed projects including, among other things, the
achievement and maintenance of sufficient occupancy levels and adequate rental
income, increases in taxes, employment and income conditions prevailing in local
labor markets, utility costs and other operating expenses, the managerial
ability of project managers, changes in laws and governmental regulations, the
appropriation of subsidies and social and economic trends affecting the
localities in which the projects are located. The occupancy of housing projects
may be adversely affected by high rent levels and income limitations imposed
under federal and state programs. Like single family mortgage revenue bonds,
multi-family mortgage revenue bonds are subject to redemption and call features,
including extraordinary mandatory redemption features, upon prepayment, sale or
non-origination of mortgage loans as well as upon the occurrence of other
events. Certain issuers of single or multi-family housing bonds have considered
various ways to redeem bonds they have issued prior to the stated first
redemption dates for such bonds. In one situation, the New York City Housing
Development Corporation, in reliance on its interpretation of certain language
in the indenture under which one of its bond issues was created, redeemed all of
such issue at par in spite of the fact that such indenture provided that the
first optional redemption was to include a premium over par and could not occur
prior to 1992.
Over 25% of the Nebraska Municipal Securities in the Tax-Free Bond Fund's
portfolio may be obligations of issuers whose revenues are primarily derived
from the sale of electric energy. Utilities are generally subject to extensive
regulation by state utility commissions which, among other things, establish the
rates which may be charged and the appropriate rate of return on an approved
asset base. The problems faced by such issuers include the difficulty in
obtaining approval for timely and adequate rate increases from the governing
public utility commission, the difficulty in financing large construction
programs, the limitations on operations and increased costs and delays
attributable to environmental considerations, increased competition, recent
reductions in estimates of future demand for electricity in certain areas of the
country, the difficulty of the capital market in absorbing utility debt, the
difficulty in obtaining fuel at reasonable prices and the effect of energy
conservation. All of such issuers have been experiencing certain of these
problems in varying degrees. In addition, federal, state and municipal
governmental authorities may from time to time review existing and impose
additional regulations governing the licensing, construction and operation of
nuclear power plants, which may adversely affect the ability of the issuers of
such bonds to make payments of principal and/or interest of such bonds.
The yields on Nebraska Municipal Securities are dependent on a variety of
factors, including general money market conditions, the financial condition of
the issuer, general conditions of the Nebraska tax-exempt obligation market, the
size of a particular offering, the maturity of the obligation and the rating of
the issue or issuer. The ratings of NRSROs represent their opinions as to the
quality of the Nebraska Municipal Securities which they undertake to rate. It
should be emphasized, however, that ratings are general, and not absolute,
standards of quality. Consequently, Nebraska Municipal Securities of the same
maturity, interest rate and rating may have different yields, while Nebraska
Municipal Securities of the same maturity and interest rate with different
ratings may have the same yield. Subsequent to their purchase by the Tax-Free
Bond Fund, particular Nebraska Municipal Securities or other investments may
cease to be rated or their ratings may be reduced below the minimum rating
required for purchase by the Fund.
<PAGE>
Great Plains Funds Management
Officers and Trustees
Officers and Trustees are listed with their addresses, principal occupations,
birthdates and present positions, including any affiliation with First Commerce
Investors, Inc., National Bank of Commerce, Federated Investors, Edgewood
Services, Inc., Federated Shareholder Services Company and Federated Services
Company.
TO BE FILED BY AMENDMENT
<PAGE>
Fund Ownership
Officers and Trustees of the Trust own less than 1% of each Fund's outstanding
shares.
Trustees' Compensation
NAME, AGGREGATE
POSITION WITH COMPENSATION
TRUST FROM TRUST*#
TO BE FILED BY AMENDMENT
* Information is estimated and furnished for the period from the Trust's date of
organization, July 11, 1997, through its fiscal year ending August 31, 1998.
The Trust is the only investment company in the Fund
Complex.
# The aggregate compensation is provided for the Trust which is comprised of
five portfolios.
Investment Advisory Services
Adviser to the Funds
The Funds' investment adviser is First Commerce Investors, Inc. ("Adviser"). The
Adviser shall not be liable to the Trust, the Funds or any shareholder of the
Funds for any losses that may be sustained in the purchase, holding, or sale of
any security, or for anything done or omitted by it, except acts or omissions
involving willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties imposed upon it by its contract with the Trust. Because
of the internal controls maintained by the Adviser's affiliates to restrict the
flow of non-public information, Fund investments are typically made without any
knowledge of the Adviser or its affiliates' lending relationships with an
issuer. The Adviser has contracted with Peter A. Kinney ("Sub-Adviser") for
investment advice on international securities and markets.
Advisory Fees
For its advisory services, the Adviser receives an annual investment advisory
fee as described in the prospectus.
Sub-Advisory Fees
For its advisory services, the Sub-Adviser receives from the Adviser, an annual
investment advisory fee as described in the prospectus.
<PAGE>
Other Services
Administrative Services
Federated Services Company, a subsidiary of Federated Investors, provides
administrative personnel and services to the Funds for a fee as described in the
prospectus.
Transfer Agent, Dividend Disbursing Agent, and Portfolio Accounting Services
Federated Services Company, Pittsburgh, Pennsylvania, through its registered
transfer agent, Federated Shareholder Services Company, is transfer agent for
shares of the Funds and dividend disbursing agent for the Funds. Federated
Services Company also provides certain accounting and recordkeeping services
with respect to the Funds' portfolio investments.
Custodian
National Bank of Commerce (the "Bank") is custodian for the securities and cash
of the Funds. Under the custodian agreement, the Bank holds the Funds' portfolio
securities and keeps all necessary records and documents relating to its duties.
The Bank's fees for custody services are based upon the market value of the
Funds' securities held in custody plus certain securities transaction charges.
Subject to arrangements approved by the Trustees, the Bank may place the
securities and cash of the Funds with other qualified custodial entities.
Independent Public Accountants
The Independent Public Accountants for the Funds are___________________.
Shareholder Servicing Arrangements
Brokerage Transactions
Research services provided by brokers and dealers may be used by the Adviser and
the Sub-Adviser in advising the Funds and other accounts. The Adviser and its
affiliates exercise reasonable business judgment in selecting brokers who offer
brokerage and research services to execute securities transactions. They
determine in good faith that commissions charged by such persons are reasonable
in relationship to the value of the brokerage and research services provided.
These services may be furnished directly to a Fund and the Adviser and may
include: advice, both directly and in writing, as to the value of securities,
the advisability of securities, or purchasers or sellers of securities, as well
as analyses and reports concerning issues, industries, securities, economic
factors and trends, portfolio strategy and the performance of accounts. To the
extent that receipt of these services may supplant services for which the
Adviser, or its affiliates might otherwise have paid, it would tend to reduce
their expenses. In addition, it is understood by the Board of Trustees that
other clients of the Adviser or its affiliates might also benefit from the
information obtained for the Funds, in the same manner that the Funds might also
benefit from information obtained by the Adviser or its affiliates in performing
services to others. Although investment decisions for the Funds are made
independently from those for other investment advisory clients of the Adviser,
it may develop that the same investment decision is made for both a Fund and one
or more other advisory clients. If both a Fund and other clients purchase or
sell that same class of securities on the same day, the transactions will be
allocated as to amount and price in a manner considered equitable to each.
<PAGE>
Distribution Plan and Agreement
The Trust has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Investment Company Act of 1940 and a form of Distribution Agreement.
These arrangements permit the payment of fees to the Distributor to stimulate
distribution activities and to cause services to be provided to shareholders by
a representative who has knowledge of the shareholder's particular circumstances
and goals. The Distributor may select certain entities to provide sales and/or
administrative services as agents for holders of Plan shares. These activities
and services may include, but are not limited to, marketing efforts, providing
office space, equipment, telephone facilities, and various clerical,
supervisory, computer, and other personnel as necessary or beneficial to
establish and maintain shareholder accounts and records, processing purchase and
redemption transactions and automatic investments of client account cash
balances, answering routine client inquiries, and assisting clients in changing
dividend options, account designations, and addresses; and providing such other
services as the Funds reasonably request. Such entities will receive fees from
the Distributor based upon Plan shares owned by their clients or customers. The
schedules of such fees and the basis upon which such fees will be paid will be
determined from time to time by the Distributor. The Funds' Plan is a
compensation type plan. As such, the Funds make no payments to the Distributor
except as described above. Therefore, the Funds do not pay for unreimbursed
expenses of the Distributor, including amounts expended by the Distributor in
excess of amounts received by it from the Funds, interest, carrying or other
financing charges in connection with excess amounts expended, or the
Distributor's overhead expenses. However, the Distributor may be able to recover
such amounts or may earn a profit from future payments made by the Funds under
the Plan.
By adopting the Plan, the Trustees expect that the Funds will be able to achieve
a more predictable flow of cash for investment purposes and to meet redemptions.
This will facilitate more efficient portfolio management and assist the Funds in
pursuing their investment objectives. By identifying potential investors whose
needs are served by a Fund's objective, and properly servicing these accounts,
it may be possible to curb sharp fluctuations in rates of redemptions and sales.
Other benefits, which may be realized under either arrangement, may include: (1)
providing personal services to shareholders; (2) investing shareholder assets
with a minimum of delay and administrative detail; (3) enhancing shareholder
recordkeeping systems; and (4) responding promptly to shareholders' requests and
inquiries concerning their accounts.
Administrative Arrangements
The administrative services include, but are not limited to, providing office
space, equipment, telephone facilities, and various personnel, including
clerical, supervisory, and computer, as is necessary or beneficial to establish
and maintain shareholders' accounts and records, process purchase and redemption
transactions, process automatic investments of client account cash balances,
answer routine client inquiries regarding the Funds, assist clients in changing
dividend options, account designations, and addresses, and providing such other
services as the Funds may reasonably request.
Conversion to Federal Funds
It is the Funds' policy to be as fully invested as possible so that maximum
interest may be earned. To this end, all payments from shareholders must be in
federal funds or be converted into federal funds before shareholders begin to
earn dividends. ___________________________ acts as the shareholder's agent in
depositing checks and converting them to federal funds.
Determining Market Value
Market Values
Market values of portfolio securities of the Funds are determined as follows:
o for domestic equity securities and foreign securities, according to the
last reported sales price on a recognized securities exchange, if available;
o in the absence of recorded sales for domestic equity securities,
according to the mean between the last closing bid and asked prices;
o in the absence of reported sales prices for foreign securities or if
the foreign security is traded over-the-counter, according to the last
reported bid price;
o for domestic bonds and other fixed income securities, at the last sales
price on a national securities exchange if available, otherwise as
determined by an independent pricing service;
o for domestic short-term obligations, according to the mean between bid
and asked price as furnished by an independent pricing service;
o for short-term obligations with remaining maturities of less than 60
days at the time of purchase, at amortized cost, which approximates
fair value; or
o at fair value as determined in good faith by the Trustees.
If a security is traded on more than one exchange, the price on the primary
market for that security, as determined by the Funds' Adviser, is used. Prices
provided by independent pricing services may be determined without relying
exclusively on quoted prices and may reflect institutional trading in similar
groups of securities, yield, quality, coupon rate, maturity, type of issue,
trading characteristics, and other market data. The Funds will value futures
contracts, and options on stocks, stock indices and futures contracts at their
market values established by the exchanges at the close of trading on such
exchanges unless the Trustees determine in good faith that another method of
valuing these positions is necessary.
Trading in Foreign Securities
Trading in foreign securities may be completed at times which vary from the
closing of the New York Stock Exchange. In computing their net asset value, the
Funds value foreign securities at the latest closing price on the exchange on
which they are traded immediately prior to the closing of the New York Stock
Exchange. Certain foreign currency exchange rates may also be determined at the
latest rate prior to the closing of the New York Stock Exchange. Foreign
securities quoted in foreign currencies are translated into U.S. dollars at
current rates. Occasionally, events that affect these values and exchange rates
may occur between the times at which they are determined and the closing of the
New York Stock Exchange. If such events materially affect the value of portfolio
securities, these securities may be valued at their fair value as determined in
good faith by the Trustees, although the actual calculation may be done by
others.
Redemption in Kind
Although the Trust intends to redeem shares in cash, it reserves the right under
certain circumstances to pay the redemption price in whole or in part by a
distribution of securities from a Fund's portfolio. To the extent available,
such securities will be readily marketable. Redemption in kind will be made in
conformity with applicable Securities and Exchange Commission rules, taking such
securities at the same value employed in determining net asset value and
selecting the securities in a manner the Trustees determine to be fair and
equitable. The Trust has elected to be governed by Rule 18f-1 under the
Investment Company Act of 1940, which obligates the Trust to redeem shares for
any one shareholder in cash only up to the lesser of $250,000 or 1% of a Fund's
net asset value during any 90-day period. Redemption in kind is not as liquid as
a cash redemption. If redemption is made in kind, shareholders receiving their
securities and selling them before their maturity could receive less than the
redemption value of their securities and could incur transaction costs. Effect
of Banking Laws
The Glass-Steagall Act and other banking laws and regulations presently prohibit
a bank holding company registered under the Bank Holding Company Act of 1956 or
any affiliate thereof from sponsoring, organizing or controlling a registered,
open-end investment company continuously engaged in the issuance of its shares,
and from issuing, underwriting, selling or distributing securities in general.
Such laws and regulations do not prohibit such a holding company or affiliate
from acting as investment adviser, transfer agent, or custodian to such an
investment company or from purchasing shares of such a company as agent for, and
upon the order of, their customers. Some entities providing services to the
Trust are subject to such banking laws and regulations. They believe, based on
the advice of its counsel, that they may perform those services for the Trust
contemplated by any agreement entered into with the Trust without violating
those laws or regulations. Changes in either federal or state statutes and
regulations relating to the permissible activities of banks and their
subsidiaries or affiliates, as well as further judicial or administrative
decisions or interpretations of present or future statutes and regulations,
could prevent these entities from continuing to perform all or a part of the
above services. If this happens, the Trustees would consider alternative means
of continuing available services. It is not expected that shareholders would
suffer any adverse financial consequences as a result of any of these
occurrences.
Massachusetts Partnership Law
Under certain circumstances, shareholders may be held personally liable as
partners under Massachusetts law for obligations of the Trust. To protect its
shareholders, the Trust has filed legal documents with Massachusetts that
expressly disclaim the liability of its shareholders for acts or obligations of
the Trust. These documents require notice of this disclaimer to be given in each
agreement, obligation, or instrument the Trust or its Trustees enter into or
sign.
In the unlikely event a shareholder is held personally liable for the Trust's
obligations, the Trust is required by the Declaration of Trust to use its
property to protect or compensate the shareholder. On request, the Trust will
defend any claim made and pay any judgment against a shareholder for any act or
obligation of the Trust. Therefore, financial loss resulting from liability as a
shareholder will occur only if the Trust itself cannot meet its obligations to
indemnify shareholders and pay judgments against them.
<PAGE>
Tax Status
The Funds' Tax Status
The Funds will pay no federal income tax because each Fund expects to meet the
requirements of Subchapter M of the Internal Revenue Code applicable to
regulated investment companies and to receive the special tax treatment afforded
to such companies. To qualify for this treatment, each Fund must, among other
requirements:
o derive at least 90% of its gross income from dividends, interest, and
gains from the sale of securities;
o derive less than 30% of its gross income from the sale of securities
held less than three months;
o invest in securities within certain statutory limits; and
o distribute to its shareholders at least 90% of its net income earned
during the year.
There are tax uncertainties with respect to whether increasing rate securities
will be treated as having an original issue discount. If it is determined that
the increasing rate securities have original issue discount, a holder will be
required to include as income in each taxable year, in addition to interest paid
on the security for that year, an amount equal to the sum of the daily portions
of original issue discount for each day during the taxable year that such holder
holds the security. There may also be tax uncertainties with respect to whether
an extension of maturity on an increasing rate note will be treated as a taxable
exchange. In the event it is determined that an extension of maturity is a
taxable exchange, a holder will recognize a taxable gain or loss, which will be
a short-term capital gain or loss if the holder holds the security as a capital
asset, to the extent that the value of the security with an extended maturity
differs from the adjusted basis of the security deemed exchanged therefor.
Foreign Taxes
Investment income on certain foreign securities may be subject to foreign
withholding or other taxes that could reduce the return on these securities. Tax
treaties between the United States and foreign countries, however, may reduce or
eliminate the amount of foreign taxes to which a Fund would be subject. However,
if a Fund may invest in the stock of certain foreign corporations that
constitute a Passive Foreign Investment Company (PFIC), then federal income
taxes may be imposed on a Fund upon disposition of PFIC investments.
Shareholders' Tax Status
Shareholders are subject to federal income tax on dividends and capital gains
received as cash or additional shares. The dividends received deduction for
corporations will apply to ordinary income distributions to the extent the
distribution represents amounts that would qualify for the dividends received
deduction to the Equity Fund, the International Equity Fund or the Premier Fund
if those Funds were regular corporations, and to the extent designated by those
Funds as so qualifying. These dividends, and any short-term capital gains are
taxable as ordinary income.
Capital Gains Capital gains, when experienced by a Fund, could result in an
increase in dividends. Capital losses could result in a decrease in dividends.
When a Fund realizes net long-term capital gains, it will distribute them at
least once every 12 months. Total Return
The average annual total return for a Fund is the average compounded rate of
return for a given period that would equate a $1,000 initial investment to the
ending redeemable value of that investment. The ending redeemable value is
computed by multiplying the number of shares owned at the end of the period by
the net asset value per share at the end of the period. The number of shares
owned at the end of the period is based on the number of shares purchased at the
beginning of the period with $1,000, adjusted over the period by any additional
shares, assuming the quarterly reinvestment of any dividends and distributions.
Cumulative total return reflects a Fund's total performance over a specific
period of time.
<PAGE>
Yield
The yield is determined by dividing the net investment income per share (as
defined by the Securities and Exchange Commission) earned by a Fund over a
thirty-day period by the offering price per share of the Fund on the last day of
the period. This value is annualized using semi-annual compounding. This means
that the amount of income generated during the thirty-day period is assumed to
be generated each month over a twelve-month period and is reinvested every six
months. The yield does not necessarily reflect income actually earned by a Fund
because of certain adjustments required by the Securities and Exchange
Commission and, therefore, may not correlate to the dividends or other
distributions paid to shareholders. To the extent that financial institutions
and broker/dealers charge fees in connection with services provided in
conjunction with an investment in a Fund, performance will be reduced for those
shareholders paying those fees.
Tax-Equivalent Yield (Tax-Free Bond Fund only)
The tax-equivalent yield of the Tax-Free Bond Fund is calculated similarly to
the yield, but is adjusted to reflect the taxable yield that this Fund would
have had to earn to equal its actual yield, assuming a 39.6% tax rate (the
maximum marginal federal rate for individuals) and assuming that income is 100%
tax-exempt.
Tax-Equivalency Table
The Tax-Free Bond Fund may also use a tax-equivalency table in advertising and
sales literature. The interest earned by the municipal bonds in the Fund's
portfolio generally remains free from federal income tax* and is often free from
state and local taxes as well. As the table on the next page indicates, a
"tax-free" investment is an attractive choice for investors, particularly in
times of narrow spreads between tax-free and taxable yields.
<TABLE>
<CAPTION>
TAXABLE YIELD EQUIVALENT FOR 1997
STATE OF NEBRASKA
COMBINED FEDERAL AND STATE INCOME TAX BRACKET:
<S> <C> <C> <C> <C> <C>
20.24% 34.99% 38.43% 43.76% 47.54%
JOINT $1- $41,201- $99,601- $151,751- OVER
RETURN 41,200 99,600 151,750 271,050 $271,050
SINGLE $1- $24,651- $59,751- $124,651- OVER
RETURN 24,650 59,750 124,650 271,050 $271,050
TAX-EXEMPT
YIELD TAXABLE YIELD EQUIVALENT
1.50% 1.88% 2.31% 2.44% 2.67% 2.86%
2.00% 2.51% 3.08% 3.25% 3.56% 3.81%
2.50% 3.13% 3.85% 4.06% 4.45% 4.77%
3.00% 3.76% 4.61% 4.87% 5.33% 5.72%
3.50% 4.39% 5.38% 5.68% 6.22% 6.67%
4.00% 5.02% 6.15% 6.50% 7.11% 7.62%
4.50% 5.64% 6.92% 7.31% 8.00% 8.58%
5.00% 6.27% 7.69% 8.12% 8.89% 9.53%
5.50% 6.90% 8.46% 8.93% 9.78% 10.48%
6.00% 7.52% 9.23% 9.74% 10.67% 11.44%
6.50% 8.15% 10.00% 10.56% 11.56% 12.39%
7.00% 8.78% 10.77% 11.37% 12.45% 13.34%
7.50% 9.40% 11.54% 12.18% 13.34% 14.30%
8.00% 10.03% 12.31% 12.99% 14.23% 15.25%
Note: The maximum marginal tax rate for each bracket was used in
calculating the taxable yield equivalent. Furthermore, additional state
and local taxes paid on comparable taxable investments were not used to
increase federal deductions.
TAXABLE YIELD EQUIVALENT FOR 1997
MULTISTATE MUNICIPAL FUNDS
FEDERAL INCOME TAX BRACKET:
15.00% 28.00% 31.00% 36.00% 39.60%
JOINT $1- $41,201- $99,601- $151,751- OVER
RETURN 41,200 99,600 151,750 271,050 $271,050
SINGLE $1- $24,651- $59,751- $124,651- OVER
RETURN 24,650 59,750 124,650 271,050 $271,050
Tax-Exempt
Yield Taxable Yield Equivalent
1.00% 1.18% 1.39% 1.45% 1.56% 1.66%
1.50% 1.76% 2.08% 2.17% 2.34% 2.48%
2.00% 2.35% 2.78% 2.90% 3.13% 3.31%
2.50% 2.94% 3.47% 3.62% 3.91% 4.14%
3.00% 3.53% 4.17% 4.35% 4.69% 4.97%
3.50% 4.12% 4.86% 5.07% 5.47% 5.79%
4.00% 4.71% 5.56% 5.80% 6.25% 6.62%
4.50% 5.29% 6.25% 6.52% 7.03% 7.45%
5.00% 5.88% 6.94% 7.25% 7.81% 8.28%
5.50% 6.47% 7.64% 7.97% 8.59% 9.11%
6.00% 7.06% 8.33% 8.70% 9.38% 9.93%
6.50% 7.65% 9.03% 9.42% 10.16% 10.76%
7.00% 8.24% 9.72% 10.14% 10.94% 11.59%
7.50% 8.82% 10.42% 10.87% 11.72% 12.42%
8.00% 9.41% 11.11% 11.59% 12.50% 13.25%
</TABLE>
Note: The maximum marginal tax rate for each bracket was used in
calculating the taxable yield equivalent. Furthermore, additional state
and local taxes paid on comparable taxable investments were not used to
increase federal deductions.
The chart above is for illustrative purposes only. It is not an
indicator of past or future performance of Fund shares. *Some portion of
the Tax-Free Bond Fund's income may be subject to the federal
alternative minimum tax and state and local income taxes.
<PAGE>
Performance Comparisons
A Fund's performance depends upon such variables as: portfolio quality; average
portfolio maturity; type of instruments in which the portfolio is invested;
changes in interest rates and market value of portfolio securities; changes in
Fund or class expenses; the relative amount of Fund cash flow; and various other
factors. Investors may use financial publications and/or indices to obtain a
more complete view of a Fund's performance. When comparing performance,
investors should consider all relevant factors such as the composition of any
index used, prevailing market conditions, portfolio compositions of other funds,
and methods used to value portfolio securities and compute offering price. The
financial publications and/or indices which the Fund uses in advertising may
include:
o Morgan Stanley Capital International Europe, Australia And Far East
Index (EAFE) is a market capitalization weighted foreign securities
index, which is widely used to measure the performance of European,
Australian and New Zealand and Far Eastern stock markets. The index
covers approximately 1,020 companies drawn from 18 countries in the
above regions. The index values its securities daily in both U.S.
dollars and local currency and calculates total returns monthly. EAFE
U.S. dollar total return is a net dividend figure less Luxembourg
withholding tax. The EAFE is monitored by Capital International, S.A.,
Geneva, Switzerland.
o Lipper Analytical Services, Inc. ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all capital gains distributions and income
dividends and takes into account any change in net asset value over a
specific period of time. From time to time, a Fund will quote its
Lipper ranking in the growth and income category in advertising and
sales literature.
o Consumer Price Index is generally considered to be a measure of
inflation.
o Dow Jones Industrial Average ("DJIA") is an unmanaged index
representing share prices of major industrial corporations, public
utilities, and transportation companies. Produced by the Dow Jones &
Company, it is cited as a principal indicator of market conditions.
o Standard & Poor's Daily Stock Price Index Of 500 Common Stocks, a
composite index of common stocks in industry, transportation,
financial, and public utility companies. The Standard & Poor's index
assumes reinvestment of all dividends paid by stocks listed on the
index. Taxes due on any of these distributions are not included, nor
are brokerage or other fees calculated in the Standard & Poor's
figures.
o Morningstar, Inc., an independent rating service, is the publisher of
the bi-weekly Mutual Fund Values. Mutual Fund Values rates more than
1,000 NASDAQ-listed mutual funds of all types, according to their
risk-adjusted returns. The maximum rating is five stars, and ratings
are effective for two weeks.
o Bank Rate Monitor National Index, Miami Beach, Florida, is a financial
reporting service which publishes weekly average rates of 50 leading
bank and thrift institution money market deposit accounts. The rates
published in the index are an average of the personal account rates
offered on the Wednesday prior to the date of publication by ten of the
largest banks and thrifts in each of the five largest Standard
Metropolitan Statistical Areas. Account minimums range upward from
$2,500 in each institution and compounding methods vary. If more than
one rate is offered, the lowest rate is used. Rates are subject to
change at any time specified by the institution.
o The S&P/BARRA Value Index and the S&P/BARRA Growth Index are
constructed by Standard & Poor's and BARRA, Inc., an investment
technology and consulting company, by separating the S&P 500 Index into
value stocks and growth stocks. The S&P/BARRA Growth and S&P/BARRA
Value Indices are constructed by dividing the stocks in the S&P 500
Index according to their price-to-book ratios. The S&P/BARRA Growth
Index, contains companies with higher price-to-earnings ratios, low
dividends yields, and high earnings growth (concentrated in
electronics, computers, health care, and drugs). The Value Index
contains companies with lower price-to-book ratios and has 50% of the
capitalization of the S&P 500 Index. These stocks tend to have lower
price-to-earnings ratios, high dividend yields, and low historical and
predicted earnings growth (concentrated in energy, utility and
financial sectors). The S&P/BARRA Value and S&P/BARRA Growth Indices
are capitalization-weighted and rebalanced semi-annually. Standard &
Poor's/BARRA calculates these total return indices with dividends
reinvested.
o Standard & Poor's Midcap 400 Stock Price Index, a composite index of
400 common stocks with market capitalizations between $200 million and
$7.5 billion in industry, transportation, financial, and public utility
companies. The Standard & Poor's index assumes reinvestment of all
dividends paid by stocks listed on the index. Taxes due on any of these
distributions are not included, nor are brokerage or other fees
calculated in the Standard & Poor's figures.
o Merrill Lynch 1-3 Year Treasury Index is an unmanaged index tracking
short-term U.S. government securities with maturities between 1 and
2.99 years. The index is produced by Merrill Lynch, Pierce, Fenner &
Smith, Inc.
o Merrill Lynch Corporate & Government Master Index is an unmanaged index
comprised of approximately 4,821 issues which include corporate debt
obligations rated BBB or better and publicly issued, non-convertible
domestic debt of the U.S. government or any agency thereof. These
quality parameters are based on composites of ratings assigned by
Standard and Poor's Ratings Group and Moody's Investors Service, Inc.
Only notes and bonds with a minimum maturity of one year are included.
o Merrill Lynch Corporate A-Rated (1-3 Year) Bond Index is a universe of
corporate bonds and notes with maturities between 1-3 years and rated
A3 or higher.
o Lehman Brothers Government/Corporate (Total) Index is comprised of
approximately 5,000 issues which include: non-convertible bonds
publicly issued by the U.S. government or its agencies; corporate bonds
guaranteed by the U.S. government and quasi-federal corporation; and
publicly issued, fixed rate, non-convertible domestic bonds of
companies in industry, public utilities, and finance. The average
maturity of these bonds approximates nine years. Traced by Lehman
Brothers, Inc., the index calculates total return for one-month,
three-month, twelve-month, and ten-year periods and year-to-date.
o Lehman Brothers Intermediate Government/Corporate Bond Index is a
universe of government and corporate bonds rated BBB or higher with maturities
between 1-10 years.
o The Salomon Brothers Total Rate-of-Return Index for mortgage pass
through securities reflects the entire mortgage pass through market and
reflects their special characteristics. The index represents data
aggregated by mortgage pool and coupon within a given sector. A market
weighted portfolio is constructed considering all newly created pools
and coupons.
o The Merrill Lynch Taxable Bond Indices include U.S. Treasury and agency
issues and were designed to keep pace with structural changes in the
fixed income market. The performance indicators capture all rating
changes, new issues, and any structural changes of the entire market.
o Lehman Brothers Mortgage-Backed Securities Index is a universe of fixed
rate securities backed by mortgage pools of Government National
Mortgage Association (GNMA), Federal Home Loan Mortgage Corp. (FHLMC),
and Federal National Mortgage Association (FNMA).
o Lehman Brothers Five-Year State General Obligations Bonds is an index
comprised of all state general obligation debt issues with maturities
between four and six years. These bonds are rated A or better and
represent a variety of coupon ranges. Index figures are total returns
calculated for one, three, and twelve month periods as well as
year-to-date. Total returns are also calculated as of the index
inception, December 31, 1979.
o Russell 2000 Small Stock Index is an unmanaged capitalization weighted
index consisting of 2,000 small capitalization common stocks.
Investments cannot be made in an index.
o Financial Times Actuaries Indices--including the FTA-World Index (and
components thereof), which are based on stocks in major world equity markets.
Investors may also consult the fund evaluation consulting universes listed
below. Consulting universes may be composed of pension, profit sharing,
commingled, endowment/foundation, and mutual funds. o Fiduciary Consulting
Grid Universe, for example, is composed of over 1,000 funds, representing
350 different investment managers, divided into subcategories based on
asset mix. The funds are ranked quarterly
based on performance and risk characteristics.
o SEI Data Base for equity funds includes approximately 900 funds,
representing 361 money managers, divided into fund types based on
investor groups and asset mix. The funds are ranked every three, six, and
twelve months.
o Mercer Meidinger, Inc. compiles a universe of approximately 600 equity
funds, representing about 500 investment managers, and updates their
rankings each calendar quarter as well as on a one, three, and five
year basis.
<PAGE>
o Bank Rate Monitor National Index, Miami Beach, Florida, is a financial
reporting service which publishes weekly average rates of 50 leading
bank and thrift institution money market deposit accounts. The rates
published in the index are an average of the personal account rates
offered on the Wednesday prior to the date of publication by ten of the
largest banks and thrifts in each of the five largest Standard
Metropolitan Statistical Areas. Account minimums range upward from
$2,500 in each institution and compounding methods vary. If more than
one rate is offered, the lowest rate is used. Rates are subject to
change at any time specified by the institution.
Advertising and other promotional literature may include charts, graphs and
other illustrations using a Fund's returns, or returns in general, that
demonstrate basic investment concepts such as tax-deferred compounding, dollar
cost averaging, and systematic investment. In addition, a Fund can compare its
performance, or performance for the types of securities in which it invests, to
a variety of other investments, such as bank savings accounts, certificates of
deposit, and Treasury bills.
Economic and Market Information
Advertising and sales literature for a Fund may include discussions of economic,
financial and political developments and their effect on the securities market.
Such discussions may take the form of commentary on these developments by Fund
portfolio managers and their views and analysis on how such developments could
affect a Fund. In addition, advertising and sales literature may quote
statistics and give general information about mutual fund industry, including
the growth of the industry, from sources such as the Investment Company
Institute ("ICI"). For example, according to the ICI, twenty-seven percent of
American households are pursuing their financial goals through mutual funds.
These investors, as well s business and institutions, have entrusted over $3
trillion to the more than 5,500 mutual funds available.
G00714-02 ( /97)
PART C. OTHER INFORMATION.
Item 24. Financial Statements and Exhibits:
(a) Financial Statements (to be filed by amendment)
(b) Exhibits:
(1) Conformed Copy of Declaration of Trust of the Registrant; +
(2) Copy of By-Laws of the Registrant; +
(3) Not applicable;
(4) Not applicable;
(5) Conformed Copy of Investment Advisory Contract of the
Registrant; (to be filed by amendment)
(i) Conformed Copy the Sub-Advisory Contract; (to be
filed by amendment)
(6) Conformed Copy of Distributor's Contract of the Registrant;
(to be filed by amendment)
(7) Not applicable;
(8) (i)Conformed Copy of Custodian Contract of the
Registrant; (to be filed by amendment)
(ii)Conformed Copy of Sub-Custodian Contract of the
Registrant; (to be filed by amendment)
(9) (i) Conformed Copy of Agreement for Fund
Accounting, Administrative Services, and
Transfer Agency Services of the Registrant;
(to be filed by amendment)
(ii)Conformed Copy of Shareholder Services
Agreement of the Registrant; (to be filed by
amendment)
(10) Conformed Copy of Opinion and Consent of Counsel as to
legality of shares being registered; (to be filed by
amendment)
(11) Conformed Copy of Consent of Independent Auditors; (to be
filed by amendment)
(12) Not applicable;
(13) Conformed Copy of Initial Capital
Understanding; (to be filed by amendment)
(14) Not applicable;
(15) (i) Conformed Copy of Distribution Plan; +
(iii) Copy of Dealer Agreement; (to be filed
by amendment) (16) Not applicable to current filing;
(17) Not applicable to current filing; (18) Not
applicable to current filing; (19) Conformed copy of
Power of Attorney; +
Item 25. Persons Controlled by or Under Common Control with Registrant
None
- -------------------------
+ All exhibits have been filed electronically.
<PAGE>
Item 26. Number of Holders of Securities:
Number of Record Holders
Title of Class as of_July______ 1997
Shares of beneficial interest
(no par value)
Great Plains Equity Fund __
Great Plains Premier Fund __
Great Plains International Equity Fund __
Great Plains Intermediate Bond Fund __
Great Plains Tax-Free Bond Fund __
Item 27. Indemnification:
Indemnification is provided to Officers and Trustees of the
Registrant pursuant to Section 2 of Article XI of Registrant's
Declaration of Trust. The Investment Advisory Contract between
the Registrant and First Commerce Investors ("Adviser")
provides that, in the absence of willful misfeasance, bad
faith, gross negligence, or reckless disregard of the
obligations or duties under the Investment Advisory Contract
on the part of Adviser, Adviser shall not be liable to the
Registrant or to any shareholder for any act or omission in
the course of or connected in any way with rendering services
or for any losses that may be sustained in the purchase,
holding, or sale of any security. Registrant's Trustees and
Officers are covered by an Investment Trust Errors and
Omissions Policy.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to Trustees, Officers,
and controlling persons of the Registrant by the Registrant
pursuant to the Declaration of Trust or otherwise, the
Registrant is aware that in the opinion of the Securities and
Exchange Commission, such indemnification is against public
policy as expressed in the Act and, therefore, is
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by Trustees, Officers,
or controlling persons of the Registrant in connection with
the successful defense of any act, suit, or proceeding) is
asserted by such Trustees, Officers, or controlling persons in
connection with the shares being registered, the Registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issues.
Insofar as indemnification for liabilities may be permitted
pursuant to Section 17 of the Investment Company Act of 1940
for Trustees, Officers, and controlling persons of the
Registrant by the Registrant pursuant to the Declaration of
Trust or otherwise, the Registrant is aware of the position of
the Securities and Exchange Commission as set forth in
Investment Company Act Release No. IC-11330. Therefore, the
Registrant undertakes that in addition to complying with the
applicable provisions of the Declaration of Trust or
otherwise, in the absence of a final decision on the merits by
a court or other body before which the proceeding was brought,
that an indemnification payment will not be made unless in the
absence of such a decision, a reasonable determination based
upon factual review has been made (i) by a majority vote of a
quorum of non-party Trustees who are not interested persons of
the Registrant or (ii) by independent legal counsel in a
written opinion that the indemnitee was not liable for an act
of willful misfeasance, bad faith, gross negligence, or
reckless disregard of duties. The Registrant further
undertakes that advancement of expenses incurred in the
defense of a proceeding (upon undertaking for repayment unless
it is ultimately determined that indemnification is
appropriate) against an Officer, Trustee, or controlling
person of the Registrant will not be made absent the
fulfillment of at least one of the following conditions: (i)
the indemnitee provides security for his undertaking; (ii) the
Registrant is insured against losses arising by reason of any
lawful advances; or (iii) a majority of a quorum of
disinterested non-party Trustees or independent legal counsel
in a written opinion makes a factual determination that there
is reason to believe the indemnitee will be entitled to
indemnification.
Item 28. Business and Other Connections of Investment Adviser:
(a) First Commerce Investors, Inc. is a registered investment adviser
providing investment management services to individuals and institutional
clients. First Commerce Investors, Inc. is a wholly owned subsidiary of First
Commerce Bancshares, Inc., a multi-bank holding company organized as a Nebraska
corporation ("FCB"). Through its subsidiaries and affiliates, FCB provides a
comprehensive range of trust, commercial, consumer, correspondent and mortgage
banking services. At December 31, 1996, FCB had an asset base of over $2
billion.
Although First Commerce Investors, Inc. has not
previosly served as an investment adviser to a mutual
fund, it has managed, on behalf of its trust clients,
eight common and collective investment funds having a
market value of approximatelly $1.6 billion.
The principal executive officers and directors of the Trust's
Investment Adviser and Sub-Adviser are set forth in the
following tables. Unless otherwise noted, the position listed
under other Substantial Business, Profession, Vocation, or
Employment is with First Commerce Investors, Inc.
<PAGE>
<TABLE>
<CAPTION>
(1) (2) (3)
<S> <C> <C>
Name Position with Adviser Other Substantial Business,
Profession, Vocation or Employment
James Stuart, III Chairman & CEO Chief Invest. Officer and Sec.,
Stuart Global Invest. Co., BVI;
Consultant, J. Stuart, III Sole
Proprietorship; Exec. V.P., Stuart
Investment Co.; Director, Standard
Bank and Trust; Director/Treasurer,
Standard Bancorp.
James Stuart, Jr. Vice President, Vice Chairman; Chairman & CEO, First Commerce
Director; Invest. Committee Member Bancshares; Chairman, Director,
Invest. Committee. Mem., First
Commerce Investors, Inc.; Chairman,
National Bank of Commerce
Harry Cameron Hinds President
Walter Bruce Remington, II Vice President Adjunct Faculty, U. of Nebraska
Bradley F. Korell Director; Investment Committee President and Director, National Bank
Member of Commerce; Vice Chairman, Director
- Inv. Committee, First Commerce
Investors, Inc.
Keith LeRoy Broman Director; Chairman, Investment
Committee
Anne Elizabeth Hansen Asst. V.P. and Compliance Officer
Kenneth L. Cheloha Investment Committee Member CFO, Lincoln General Hospital;
Chairman and CEO, Heartland Capital
Charles Wayne Hoskins Investment Committee Member Consultant
Gene Henry Koepke Investment Committee Member Professor, U. of Nebraska - Kearney
Roy Martin Otte Director; Investment Committe
Member
Christopher P. Sullivan Investment Officer
</TABLE>
(b) Peter A. Kinney will be a registered investment adviser
with the Securities and Exchange Commission (registration
pending) and has been acting in a consulting capacity for
First Commerce Investors, Inc. since 1993. During that
period, he has provided consultation and recommendations
on international eqities, economies and currencies to
First Commerce Investors, Inc. Mr. Kinney provides
investment management services to client discretionary
accounts with assets totalling approximately $________ as
of December 31, 1996. Peter A. Kinney serves as
Sub-Adviser to the Great Plains International Equity Fund
and the Great Plains Equity Fund.
Item 29. Principal Underwriters:
(a) Edgewood Services, Inc. the Distributor for shares of the Registrant,
also acts as principal underwriter for the following open-end investment
companies: BT Advisor Funds, BT Pyramid Mutual Funds, BT Investment Funds, BT
Institutional Funds, Excelsior Institutional Trust (formerly, UST Master Funds,
Inc.), Excelsior Tax-Exempt Funds, Inc. (formerly, UST Master Tax-Exempt Funds,
Inc.), Excelsior Institutional Trust, FTI Funds, FundManager Portfolios,
Marketvest Funds, Marketvest Funds, Inc. and Old Westbury Funds, Inc.
<PAGE>
<TABLE>
<CAPTION>
(b)
<S> <C> <C>
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address With Distributor With Registrant
Lawrence Caracciolo Director, President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Arthur L. Cherry Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
J. Christopher Donahue Director, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Sholes Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ronald M. Petnuch Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas P. Schmitt Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Ernest L. Linane Assistant Vice President, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
S. Elliott Cohan Secretary,
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Thomas J. Ward Assistant Secretary, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
Kenneth W. Pegher, Jr. Treasurer, --
Federated Investors Tower Edgewood Services, Inc.
Pittsburgh, PA 15222-3779
</TABLE>
(c) Not applicable
<PAGE>
Item 30. Location of Accounts and Records:
All accounts and records required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and Rules 31a-1 through 31a-3 promulgated
thereunder are maintained at one of the following locations:
Registrant Federated Investors Tower
Pittsburgh, PA 15222-3779
Federated Shareholder Services Company Federated Investors Tower
("Transfer Agent, Dividend Pittsburgh, PA 15222-3779
Disbursing Agent and Portfolio
Accounting Services")
Federated Services Company Federated Investors Tower
("Administrator") Pittsburgh, PA 15222-3779
National Bank of Commerce 1248 "O" Street
( "Custodian") Lincoln, Nebraska 68508
First Commerce Investors, Inc. 610 NBC Center
("Adviser") 1248 "O" Street
Lincoln, Nebraska 68508
Peter A. Kinney 11 S. LaSalle #2900
("Sub-Adviser") Chicago, IL 60603
Item 31. Management Services: Not applicable.
Item 32. Undertakings:
Registrant hereby undertakes to file a post-effective
amendment, using financial statements which need not be
certified, within four to six months from the effective date
of Registrant's 1933 Act Registration Statement.
Registrant hereby undertakes to comply with the provisions of
Section 16(c) of the 1940 Act with respect to the removal of Trustees and the
calling of special shareholder meetings by shareholders.
Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual report to
shareholders, upon request and without charge.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, GREAT PLAINS FUNDS, has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Pittsburgh and
Commonwealth of Pennsylvania, on the 11th day of July, 1997.
GREAT PLAINS FUNDS
BY: /s/ Victor R. Siclari
Victor R. Siclari
Attorney in Fact for the Trustees
July 11, 1997
Pursuant to the requirements of the Securities Act of 1933, Registration
Statement has been signed below by the following person in the capacity and on
the date indicated:
NAME TITLE DATE
By: /s/ Victor R. Siclari
Victor R. Siclari Attorney In Fact July 11, 1997
For the Persons
Listed Below
NAME TITLE
Anne C. Hansen* Trustee
Victor R. Siclari* Trustee
Timothy S. Johnson* Trustee
C. Christine Thomson* Trustee
* By Power of Attorney
xii
Exhibit 2 under Form N-1A
Exhibit (3)b under Item 601/Reg. S-K
GREAT PLAINS FUNDS
BYLAWS
TABLE OF CONTENTS
Page
ARTICLE I: OFFICERS AND THEIR ELECTION....................................1
Section 1 Officers..................................................1
Section 2 Election of Officers......................................1
Section 3 Resignations and Removals and Vacancies...................1
ARTICLE II: POWERS AND DUTIES OF TRUSTEES AND OFFICERS.....................1
Section 1 Trustees..................................................1
Section 2 Chairman of the Trustees ("Chairman") ....................1
Section 3 President ................................................1
Section 4 Vice President ...........................................2
Section 5 Secretary ................................................2
Section 6 Treasurer ................................................2
Section 7 Assistant Vice President .................................2
Section 8 Assistant Secretaries and Assistant Treasurers ...........2
Section 9 Salaries .................................................2
ARTICLE III: POWERS AND DUTIES OF THE EXECUTIVE AND OTHER COMMITTEES......3
Section 1 Executive and Other Committees ...........................3
Section 2 Vacancies in Executive Committee .........................3
Section 3 Executive Committee to Report to Trustees.................3
Section 4 Procedure of Executive Committee .........................3
Section 5 Powers of Executive Committee ............................3
Section 6 Compensation .............................................3
Section 7 Action by Consent of the Board of Trustees, Executive Committee
or Other Committee.......................................3
ARTICLE IV: SHAREHOLDERS' MEETINGS.........................................4
Section 1 Special Meetings ..........................................4
Section 2 Notices ...................................................4
Section 3 Place of Meeting ..........................................4
Section 4 Action by Consent .........................................4
Section 5 Proxies ...................................................4
<PAGE>
Page
ARTICLE V: TRUSTEES' MEETINGS.............................................4
Section 1 Number and Qualifications of Trustees ...................4
Section 2 Special Meetings ........................................5
Section 3 Regular Meetings ........................................5
Section 4 Quorum and Vote .........................................5
Section 5 Notices .................................................5
Section 6 Place of Meeting ........................................5
Section 7 Teleconference Meetings; Action by Consent ..............5
Section 8 Special Action ..........................................5
Section 9 Compensation of Trustees ................................6
ARTICLE VI: SHARES........................................................6
Section 1 Certificates ..............................................6
Section 2 Transfer of Shares ........................................6
Section 3 Equitable Interest Not Recognized .........................6
Section 4 Lost, Destroyed or Mutilated Certificates..................6
Section 5 Transfer Agent and Registrar: Regulations..................7
ARTICLE VII: INSPECTION OF BOOKS...........................................7
ARTICLE VIII: AGREEMENTS, CHECKS, DRAFTS, ENDORSEMENTS, ETC................7
Section 1 Agreements, Etc. ..........................................7
Section 2 Checks, Drafts, Etc. ......................................7
Section 3 Endorsements, Assignments and Transfer of Securities ......7
Section 4 Evidence of Authority .....................................8
ARTICLE IX: INDEMNIFICATION OF TRUSTEES AND OFFICERS.......................8
Section 1 General ...................................................8
Section 2 Compromise Payment ........................................8
Section 3 Indemnification Not Exclusive; Definitions ................8
ARTICLE X: SEAL 9
ARTICLE XI: FISCAL YEAR....................................................9
ARTICLE XII: AMENDMENTS....................................................9
<PAGE>
Page
ARTICLE XIII: WAIVERS OF NOTICE............................................9
ARTICLE XIV: REPORT TO SHAREHOLDERS........................................9
ARTICLE XV: BOOKS AND RECORDS.............................................10
ARTICLE XVI: TERMS........................................................10
<PAGE>
GREAT PLAINS FUNDS
BYLAWS
ARTICLE I
OFFICERS AND THEIR ELECTION
Section 1. Officers. The officers of the Trust shall be elected by the Board of
Trustees, and shall be a President, one or more Vice Presidents, a
Treasurer, a Secretary and such other officers as the Trustees may from
time to time elect. The Board of Trustees, in its discretion, may also
elect a Chairman of the Board of Trustees (who must be a Trustee). It
shall not be necessary for any Trustee or other officer to be a holder
of shares in any Series or Class of the Trust.
Section 2. Election of Officers. The President, Vice President(s), Treasurer
and Secretary shall be elected annually by the Trustees, and serve
until a successor is so elected and qualified, or until earlier
resignation or removal. The Chairman of the Trustees, if there is one,
shall be elected annually by and from the Trustees, and serve until a
successor is so elected and qualified, or until earlier resignation or
removal.
Two or more offices may be held by a single person except the offices of
President and Secretary. The officers shall hold office until their successors
are elected and qualified.
Section 3. Resignations and Removals and Vacancies. Any officer of the Trust
may resign by filing a written resignation with the President (or
Chairman, if there is one) of the Trustees or with the Trustees or with
the Secretary, which shall take effect on being so filed or at such
time as may be therein specified. The Trustees may remove any officer,
with or without cause, by a majority vote of all of the Trustees. The
Trustees may fill any vacancy created in any office whether by
resignation, removal or otherwise, subject to the limitations of the
Investment Company Act of 1940.
ARTICLE II
POWERS AND DUTIES OF TRUSTEES AND OFFICERS
Section 1. Trustees. The business and affairs of the Trust shall be managed
by the Trustees, and they shall have all powers necessary and desirable to carry
out that responsibility. --------
Section 2. Chairman of the Trustees ("Chairman"). The Chairman, if there be a
Chairman, shall preside at the meetings of Shareholders and of the
Board of Trustees. He shall have general supervision over the business
of the Trust and policies of the Trust. He shall employ and define the
duties of all employees of the Trust, shall have power to discharge any
such employees, shall exercise general supervision over the affairs of
the Trust and shall perform such other duties as may be assigned to him
from time to time by the Trustees. The Chairman shall appoint a Trustee
or officer to preside at such meetings in his absence.
Section 3. President. The President shall be the chief executive officer of the
Trust. The President, in the absence of the Chairman, or if there is no
Chairman, shall perform all duties and may exercise any of the powers
of the Chairman subject to the control of the Trustees. He shall
counsel and advise the Chairman and shall perform such other duties as
may be assigned to him from time to time by the Trustees, the Chairman
or the Executive Committee. The President shall have the power to
appoint one or more Assistant Secretaries or other junior officers,
subject to ratification of such appointments by the Board. The
President shall have the power to sign, in the name of and on behalf of
the Trust, powers of attorney, proxies, waivers of notice of meeting,
consents and other instruments relating to securities or other property
owned by the Trust, and may, in the name of and on behalf of the Trust,
take all such action as the President may deem advisable in entering
into agreements to purchase securities or other property in the
ordinary course of business, and to sign representation letters in the
course of buying securities or other property.
Section 4. Vice President. The Vice President (or if more than one, the senior
Vice President) in the absence of the President shall perform all
duties and may exercise any of the powers of the President subject to
the control of the Trustees. Each Vice President shall perform such
other duties as may be assigned to him from time to time by the
Trustees, the Chairman, the President, or the Executive Committee. Each
Vice President shall be authorized to sign documents on behalf of the
Trust. The Vice President shall have the power to sign, in the name of
and on behalf of the Trust and subject to Article VIII, Section 1,
powers of attorney, proxies, waivers of notice of meeting, consents and
other instruments relating to securities or other property owned by the
Trust, and may, in the name of and on behalf of the Trust, take all
such action as the Vice President may deem advisable in entering into
agreements to purchase securities or other property in the ordinary
course of business, and to sign representation letters in the course of
buying securities or other property.
Section 5. Secretary. The Secretary shall keep or cause to be kept in books
provided for that purpose the Minutes of the Meetings of Shareholders
and of the Trustees; shall see that all Notices are duly given in
accordance with the provisions of these Bylaws and as required by law;
shall be custodian of the records and of the Seal of the Trust (if
there be a Seal) and see that the Seal is affixed to all documents, the
execution of which on behalf of the Trust under its Seal is duly
authorized; shall keep directly or through a transfer agent a register
of the post office address of each shareholder of each Series or Class
of the Trust, and make all proper changes in such register, retaining
and filing his authority for such entries; shall see that the books,
reports, statements, certificates and all other documents and records
required by law are properly kept and filed; and in general shall
perform all duties incident to the Office of Secretary and such other
duties as may from time to time be assigned to him by the Trustees,
Chairman, the President, or the Executive Committee.
Section 6. Treasurer. The Treasurer shall be the principal financial and
accounting officer of the Trust responsible for the preparation and
maintenance of the financial books and records of the Trust. He shall
deliver all funds and securities belonging to any Series or Class to
such custodian or sub-custodian as may be employed by the Trust for any
Series or Class. The Treasurer shall perform such duties additional to
the foregoing as the Trustees, Chairman, the President or the Executive
Committee may from time to time designate.
Section 7. Assistant Vice President. The Assistant Vice President or Vice
Presidents of the Trust shall have such authority and perform such
duties as may be assigned to them by the Trustees, the Executive
Committee, the President, or the Chairman.
Section 8. Assistant Secretaries and Assistant Treasurers. The Assistant
Secretary or Secretaries and the Assistant Treasurer or Treasurers
shall perform the duties of the Secretary and of the Treasurer,
respectively, in the absence of those Officers and shall have such
further powers and perform such other duties as may be assigned to them
respectively by the Trustees or the Executive Committee, the President,
or the Chairman.
Section 9. Salaries. The salaries of the Officers shall be fixed from time to
time by the Trustees. No officer shall be prevented from receiving
such salary by reason of the fact that such officer is also a
--------
Trustee.
ARTICLE III
POWERS AND DUTIES OF THE EXECUTIVE AND OTHER COMMITTEES
Section 1. Executive and Other Committees. The Trustees may elect from their
own number an Executive Committee to consist of not less than two
members. The Executive Committee shall be elected by a resolution
passed by a vote of at least a majority of the Trustees then in office.
The Trustees may also elect from their own number other committees from
time to time, the number composing such committees and the powers
conferred upon the same to be determined by vote of the Trustees. Any
committee may make rules for the conduct of its business.
Section 2. Vacancies in Executive Committee. Vacancies occurring in the
Executive Committee from any cause shall be filled by the Trustees by
a resolution passed by the vote of at least a majority of the Trustees
--------------------------------
then in office.
Section 3. Executive Committee to Report to Trustees. All action by the
Executive Committee shall be reported to the Trustees at their
meeting next succeeding such action.
-----------------------------------------
Section 4. Procedure of Executive Committee. The Executive Committee shall fix
its own rules of procedure not inconsistent with these Bylaws or with
any directions of the Trustees. It shall meet at such times and places
and upon such notice as shall be provided by such rules or by
resolution of the Trustees. The presence of a majority shall constitute
a quorum for the transaction of business, and in every case an
affirmative vote of a majority of all the members of the Committee
present shall be necessary for the taking of any action.
Section 5. Powers of Executive Committee. During the intervals between the
Meetings of the Trustees, the Executive Committee, except as limited by
the Bylaws of the Trust or by specific directions of the Trustees,
shall possess and may exercise all the powers of the Trustees in the
management and direction of the business and conduct of the affairs of
the Trust in such manner as the Executive Committee shall deem to be in
the best interests of the Trust, and shall have power to authorize the
Seal of the Trust (if there is one) to be affixed to all instruments
and documents requiring same. Notwithstanding the foregoing, the
Executive Committee shall not have the power to elect or remove
Trustees, increase or decrease the number of Trustees, elect or remove
any Officer, declare dividends, issue shares or recommend to
shareholders any action requiring shareholder approval.
Section 6. Compensation. The members of any duly appointed committee shall
receive such compensation and/or fees as from time to time may be
fixed by the Trustees.
------------
Section 7. Action by Consent of the Board of Trustees, Executive Committee or
Other Committee. Subject to Article V, Section 2 of these Bylaws, any
action required or permitted to be taken at any meeting of the
Trustees, Executive Committee or any other duly appointed Committee may
be taken without a meeting if consents in writing setting forth such
action are signed by all members of the Board or such committee and
such consents are filed with the records of the Trust. In the event of
the death, removal, resignation or incapacity of any Board or committee
member prior to that Trustee signing such consent, the remaining Board
or committee members may re-constitute themselves as the entire Board
or committee until such time as the vacancy is filled in order to
fulfill the requirement that such consents be signed by all members of
the Board or committee.
ARTICLE IV
SHAREHOLDERS' MEETINGS
Section 1. Special Meetings. A special meeting of the shareholders of the Trust
or of a particular Series or Class shall be called by the Secretary
whenever ordered by the Trustees, the Chairman or requested in writing
by the holder or holders of at least one-tenth of the outstanding
shares of the Trust or of the relevant Series or Class, entitled to
vote. If the Secretary, when so ordered or requested, refuses or
neglects for more than two days to call such special meeting, the
Trustees, Chairman or the shareholders so requesting may, in the name
of the Secretary, call the meeting by giving notice thereof in the
manner required when notice is given by the Secretary.
Section 2. Notices. Except as above provided, notices of any special meeting of
the shareholders of the Trust or a particular Series or Class, shall be
given by the Secretary by delivering or mailing, postage prepaid, to
each shareholder entitled to vote at said meeting, a written or printed
notification of such meeting, at least seven business days before the
meeting, to such address as may be registered with the Trust by the
shareholder. No notice of any meeting to shareholders need be given to
a shareholder if a written waiver of notice, executed before or after
the meeting by such shareholder or his or her attorney that is duly
authorized, is filed with the records of the meeting. Notice may be
waived as provided in Article XIII of these Bylaws.
Section 3. Place of Meeting. Meetings of the shareholders of the Trust or a
particular Series or Class, shall be held at the principal place of
business of the investment advisor to the Trust in Lincoln, Nebraska,
or at such other place as may be fixed from time to time by (i)
resolution of the Trustees or (ii) by the President and any one other
officer of the Trust.
Section 4. Action by Consent. Any action required or permitted to be taken at
any meeting of shareholders may be taken without a meeting, if a
consent in writing, setting forth such action, is signed by a majority
of the shareholders entitled to vote on the subject matter thereof, and
such consent is filed with the records of the Trust.
Section 5. Proxies. Any shareholder entitled to vote at any meeting of
shareholders may vote either in person, by telephone, by electronic
means including facsimile, or by proxy. Every written proxy shall be
subscribed by the shareholder or his duly authorized attorney and
dated, but need not be sealed, witnessed or acknowledged. All proxies
shall be filed with and verified by the Secretary or an Assistant
Secretary of the Trust or, the person acting as Secretary of the
Meeting.
ARTICLE V
TRUSTEES' MEETINGS
Section 1. Number and Qualifications of Trustees. The number of Trustees can be
changed from time to time by a majority of the Trustees to not less
than three nor more than twenty. The term of office of a Trustee shall
not be affected by any decrease in the number of Trustees made by the
Trustees pursuant to the foregoing authorization. Each Trustee shall
hold office for the life of the Trust, or as otherwise provided in the
Declaration of Trust.
Section 2. Special Meetings. Special meetings of the Trustees shall be called
by the Secretary at the written request of the Chairman, the President,
or any Trustee, and if the Secretary when so requested refuses or fails
for more than twenty-four hours to call such meeting, the Chairman, the
President, or such Trustee may in the name of the Secretary call such
meeting by giving due notice in the manner required when notice is
given by the Secretary.
Section 3. Regular Meetings. Regular meetings of the Trustees may be held
without call or notice at such places and at such times as the Trustees
may from time to time determine, provided that any Trustee who is
absent when such determination is made shall be given notice of the
determination.
Section 4. Quorum and Vote. A majority of the Trustees shall constitute a
quorum for the transaction of business. The act of a majority of the
Trustees present at any meeting at which a quorum is present shall be
the act of the Trustees unless a greater proportion is required by the
Declaration of Trust or these Bylaws or applicable law. In the absence
of a quorum, a majority of the Trustees present may adjourn the meeting
from time to time until a quorum shall be present. Notice of any
adjourned meeting need not be given.
Section 5. Notices. The Secretary or any Assistant Secretary shall give, at
least two days before the meeting, notice of each meeting of the Board
of Trustees, whether Annual, Regular or Special, to each member of the
Board by mail, telegram, telephone or electronic facsimile to his last
known address. It shall not be necessary to state the purpose or
business to be transacted in the notice of any meeting unless otherwise
required by law. Personal attendance at any meeting by a Trustee other
than to protest the validity of said meeting shall constitute a waiver
of the foregoing requirement of notice. In addition, notice of a
meeting need not be given if a written waiver of notice executed by
such Trustee before or after the meeting is filed with the records of
the meeting.
Section 6. Place of Meeting. Meetings of the Trustees shall be held at the
principal place of business of the investment advisor to the Trust in
Lincoln, Nebraska, or at such other place as may be fixed from time to
time (i) by resolution of the Trustees (ii) by the President and any
one other officer of the Trust or (iii) as the person or persons
requesting said meeting to be called may designate, but any meeting may
adjourn to any other place.
Section 7. Teleconference Meetings; Action by Consent. Except as otherwise
provided herein or from time to time in the 1940 Act or in the
Declaration of Trust, any action to be taken by the Trustees may be
taken by a majority of the Trustees within or without Massachusetts,
including any meeting held by means of a conference telephone or other
communications equipment by means of which all persons participating in
the meeting can communicate with each other simultaneously, and
participation by such means shall constitute presence in person at a
meeting. Any action by the Trustees may be taken without a meeting if a
written consent thereto is signed by all the Trustees and filed with
the records of the Trustees' meetings. Such consent shall be treated as
a vote of the Trustees for all purposes. Written consents may be
executed in counterparts, which when taken together, constitute a
validly executed consent of the Trustees.
Section 8. Special Action. When all the Trustees shall be present at any
meeting, however called, or whenever held, or shall assent to the
holding of the meeting without notice, or after the meeting shall sign
a written assent thereto on the record of such meeting, the acts of
such meeting shall be valid as if such meeting had been regularly held.
Section 9. Compensation of Trustees. The Trustees may receive such compensation
as determined by resolution of the Trustees, and expenses may be
allowed for attendance at each meeting. Nothing herein contained shall
be construed to preclude any Trustee from serving the Trust in any
other capacity, as an officer, agent or otherwise, and receiving
compensation therefor.
ARTICLE VI
SHARES
Section 1. Certificates. If certificates for shares are issued, all
certificates for shares shall be signed by the Chairman, President or
any Vice President and by the Treasurer or Secretary or any Assistant
Treasurer or Assistant Secretary and sealed with the seal of the Trust,
if the Trust has a seal. The signatures may be either manual or
facsimile signatures and the seal, if there is one, may be either
facsimile or any other form of seal. Certificates for shares for which
the Trust has appointed an independent Transfer Agent and Registrar
shall not be valid unless countersigned by such Transfer Agent and
registered by such Registrar. In case any officer who has signed any
certificate ceases to be an officer of the Trust before the certificate
is issued, the certificate may nevertheless be issued by the Trust with
the same effect as if the officer had not ceased to be such officer as
of the date of its issuance. Share certificates of each Series or Class
shall be in such form not inconsistent with law or the Declaration of
Trust or these Bylaws as may be determined by the Trustees.
Section 2. Transfer of Shares. The shares of each Series and Class of the Trust
shall be transferable, so as to affect the rights of the Trust or any
Series or Class, only by transfer recorded on the books of the Trust or
its transfer agent, in person or by attorney.
Section 3. Equitable Interest Not Recognized. The Trust shall be entitled to
treat the holder of record of any share or shares of a Series or Class
as the absolute owner thereof and shall not be bound to recognize any
equitable or other claim or interest in such share or shares of a
Series or Class on the part of any other person except as may be
otherwise expressly provided by law.
Section 4. Lost, Destroyed or Mutilated Certificates. In case any certificate
for shares is lost, mutilated or destroyed, the Trustees may issue a
new certificate in place thereof upon indemnity to the relevant Series
or Class against loss and upon such other terms and conditions as the
Trustees may deem advisable.
Section 5. Transfer Agent and Registrar: Regulations. The Trustees shall have
power and authority to make all such rules and regulations as they may
deem expedient concerning the issuance, transfer and registration of
certificates for shares and may appoint a Transfer Agent and/or
Registrar of certificates for shares of each Series or Class, and may
require all such share certificates to bear the signature of such
Transfer Agent and/or of such Registrar.
ARTICLE VII
INSPECTION OF BOOKS
The Trustees shall from time to time determine whether and to what extent,
and at what times and places, and under what conditions and regulations the
accounts and books of the Trust maintained on behalf of each Series and
Class or any of them shall be open to the inspection of the shareholders of
any Series or Class; and no shareholder shall have any right of inspecting
any account or book or document of the Trust except that, to the extent such
account or book or document relates to the Series or Class in which he is a
Shareholder or the Trust generally, such Shareholder shall have such right
of inspection as conferred by laws or authorized by the Trustees or by
resolution of the Shareholders of the relevant Series or Class.
ARTICLE VIII
AGREEMENTS, CHECKS, DRAFTS, ENDORSEMENTS, ETC.
Section 1. Agreements, Etc. The Trustees or the Executive Committee may
authorize any Officer or Agent of the Trust to enter into any Agreement
or execute and deliver any instrument in the name of the Trust on
behalf of any Series or Class, and such authority may be general or
confined to specific instances; and, unless so authorized by the
Trustees or by the Executive Committee or by the Declaration of Trust
or these Bylaws, no Officer, Agent or Employee shall have any power or
authority to bind the Trust by any Agreement or engagement or to pledge
its credit or to render it liable pecuniarily for any purpose or for
any amount.
Section 2. Checks, Drafts, Etc. All checks, drafts, or orders for the payment
of money, notes and other evidences of indebtedness shall be signed by
such Officers, Employees, or Agents, as shall from time to time be
designated by the Trustees or the Executive Committee, or as may be
specified in or pursuant to the agreement between the Trust on behalf
of any Series or Class and the custodian appointed, pursuant to the
provisions of the Declaration of Trust.
Section 3. Endorsements, Assignments and Transfer of Securities. All
endorsements, assignments, stock powers, other instruments of transfer
or directions for the transfer of portfolio securities or other
property, whether or not registered in nominee form, shall be made by
such Officers, Employees, or Agents as may be authorized by the
Trustees or the Executive Committee.
Section 4. Evidence of Authority. Anyone dealing with the Trust shall be fully
justified in relying on a copy of a resolution of the Trustees or of
any committee thereof empowered to act in the premises which is
certified as true by the Secretary or an Assistant Secretary under the
seal of the Trust.
ARTICLE IX
INDEMNIFICATION OF TRUSTEES AND OFFICERS
Section 1. General. The Trust shall indemnify each of its Trustees and officers
(including persons who serve at the Trust's request as directors,
officers or trustees of another organization in which the Trust has any
interest as a shareholder, creditor or otherwise) (hereinafter referred
to as a "Covered Person") against all liabilities and expenses,
including but not limited to amounts paid in satisfaction of judgments,
in compromise or as fines and penalties, and counsel fees reasonably
incurred by any Covered Person in connection with the defense or
disposition of any action, suit or other proceeding, whether civil,
criminal, administrative, or investigative, and any appeal therefrom,
before any court or administrative or legislative body, in which such
Covered Person may be or may have been involved as a party or otherwise
or with which such person may be or may have been threatened, while in
office or thereafter, by reason of being or having been such a Covered
Person, except that no Covered Person shall be indemnified against any
liability to the Trust or its Shareholders to which such Covered Person
would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office.
Expenses, including counsel fees so incurred by any such Covered Person
(but excluding amounts paid in satisfaction of judgments, in compromise
or as fines or penalties), may be paid from time to time by the Trust
in advance of the final disposition of any such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such
Covered Person to repay amounts so paid to the Trust if it is
ultimately determined that indemnification of such expenses is not
authorized under this Article, provided that (a) such Covered Person
shall provide security for his undertaking, (b) the Trust shall be
insured against losses arising by reason of such Covered Person's
failure to fulfill his undertaking or (c) a majority of the non-party
Trustees who are not interested persons of the Trust (provided that a
majority of such Trustees then in office act on the matter), or
independent legal counsel in a written opinion, shall determine, based
on a review of readily available facts (but not a full trial-type
inquiry), that there is reason to believe such Covered Person
ultimately will be entitled to indemnification.
Section 2. Compromise Payment. As to any matter disposed of (whether by a
compromise payment, pursuant to a consent decree or otherwise) without
an adjudication, in a decision on the merits by a court, or by any
other body before which the proceeding was brought, that such Covered
Person is liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office,
indemnification shall be provided if (a) approved as in the best
interest of the Trust, after notice that it involves such
indemnification, by at least a majority of non-party Trustees who are
not interested persons of the Trust (provided that a majority of such
Trustees then in office act on the matter), upon a determination, based
upon a review of readily available facts (but not a full trial-type
inquiry) that such Covered Person is not liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of such Covered Person's office, or (b) there has been obtained an
opinion in writing of independent legal counsel, based upon a review of
readily available facts (but not a full trial-type inquiry) to the
effect that such indemnification would not protect such Covered Person
against any liability to the Trust to which such Covered Person would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of his office.
Any approval pursuant to this Section shall not prevent the recovery
from any Covered Person of any amount paid to such Covered Person in
accordance with this Section as indemnification if such Covered Person
is subsequently adjudicated by a court of competent jurisdiction to
have been liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such Covered Person's office.
Section 3. Indemnification Not Exclusive; Definitions. The right of
indemnification hereby provided shall not be exclusive of or affect any
other rights to which any such Covered Person may be entitled. As used
in this Article IX, the term "Covered Person" shall include such
person's heirs, executors and administrators. For purposes of this
Article IX, the term "non-party Trustee" is a Trustee against whom none
of the actions, suits or other proceedings in question or another
action, suit or other proceeding on the same or similar grounds is then
or has been pending. Nothing contained in this Article IX shall affect
any rights to indemnification to which personnel of the Trust, other
than Trustees and officers, and other persons may be entitled by
contract or otherwise under law, nor the power of the Trust to purchase
and maintain liability insurance on behalf of such persons.
ARTICLE X
SEAL
The seal of the Trust, if there is one, shall consist either of a
flat-faced die with the word "Massachusetts", together with the name of
the Trust and the year of its organization cut or engraved thereon, or
any other indication that the Trust has a seal that has been approved
by the Trustees, but, unless otherwise required by the Trustees, the
seal shall not be necessary to be placed on, and its absence shall not
impair the validity of, any document, instrument or other paper
executed and delivered by or on behalf of the Trust.
ARTICLE XI
FISCAL YEAR
The fiscal year of the Trust and each Series or Class shall be as designated
from time to time by the Trustees.
ARTICLE XII
AMENDMENTS
These Bylaws may be amended by a majority vote of all of the Trustees.
ARTICLE XIII
WAIVERS OF NOTICE
Whenever any notice whatever is required to be given under the provisions of any
statute of The Commonwealth of Massachusetts, or under the provisions
of the Declaration of Trust or these Bylaws, a waiver thereof in
writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, or presence at a
meeting to which such person was entitled notice of, shall be deemed
equivalent thereto. A notice shall be deemed to have been given if
telegraphed, cabled, or sent by wireless when it has been delivered to
a representative of any telegraph, cable or wireless company with
instructions that it be telegraphed, cabled, or sent by wireless. Any
notice shall be deemed to be given if mailed at the time when the same
shall be deposited in the mail.
ARTICLE XIV
REPORT TO SHAREHOLDERS
The Trustees, so long as required by applicable law, shall at least
semi-annually submit to the shareholders of each Series or Class a
written financial report of the transactions of that Series or Class
including financial statements which shall at least annually be
certified by independent public accountants.
ARTICLE XV
BOOKS AND RECORDS
The books and records of the Trust and any Series or Class, including the
stock ledger or ledgers, may be kept in or outside the Commonwealth of
Massachusetts at such office or agency of the Trust as may from time to
time be determined by the Secretary of the Trust, as set forth in
Article II, Section 5 of these Bylaws.
ARTICLE XVI
TERMS
Terms defined in the Declaration of Trust and not otherwise defined herein are
used herein with the meanings set forth or referred to in the Declaration of
Trust.
xxiv
EXHIBIT 1 UNDER FORM N-1A
EXHIBIT 3(A) UNDER ITEM 601/REG. S-K
GREAT PLAINS FUNDS
DECLARATION OF TRUST
TABLE OF CONTENTS
Page
ARTICLE I. NAMES AND DEFINITIONS ...........................................1
Section 1. Name ......................................................1
Section 2. Definitions ...............................................1
ARTICLE II. PURPOSE OF TRUST...............................................2
ARTICLE III. BENEFICIAL INTEREST............................................2
Section 1. Shares of Beneficial Interest..............................2
Section 2. Ownership of Shares .......................................2
Section 3. Investment in the Trust ...................................3
Section 4. No Pre-emptive Rights; Action by Shareholder...............3
Section 5. Establishment and Designation of Series or Class ..........3
ARTICLE IV. THE TRUSTEES ..................................................5
Section 1. Management of the Trust ...................................5
Section 2. Election of Trustees by Shareholders ......................5
Section 3. Term of Office of Trustees ................................5
Section 4. Termination of Service and Appointment of Trustees ........6
Section 5. Number of Trustees ........................................6
Section 6. Effect of Death, Resignation, etc. of a Trustee ...........6
Section 7. Ownership of Assets .......................................6
ARTICLE V. POWERS OF THE TRUSTEES ........................................6
Section 1. Powers ....................................................6
Section 2. Principal Transactions ....................................9
Section 3. Trustees and Officers as Shareholders......................9
Section 4. Parties to Contract........................................9
<PAGE>
Page
ARTICLE VI. TRUSTEES' EXPENSES AND COMPENSATION ..........................10
Section 1. Trustee Reimbursement....................................10
Section 2. Trustee Compensation ....................................10
ARTICLE VII. INVESTMENT ADVISER, ADMINISTRATIVE SERVICES, PRINCIPAL
UNDERWRITER AND TRANSFER AGENT ............................11
- ------------------------------------------- ------------------------- ---------
Section 1. Investment Adviser .......................................11
Section 2. Administrative Services ..................................11
Section 3. Principal Underwriter ....................................11
Section 4. Transfer Agent ...........................................12
ARTICLE VIII. SHAREHOLDERS' VOTING POWERS AND MEETINGS ......................12
Section 1. Voting Powers ............................................12
Section 2. Meetings..................................................12
Section 3. Quorum and Required Vote .................................13
Section 4. Action by Written Consent ................................13
Section 5. Additional Provisions ....................................13
ARTICLE IX. CUSTODIAN .....................................................13
ARTICLE X. DISTRIBUTIONS AND REDEMPTIONS .................................13
Section 1. Distributions ............................................13
Section 2. Redemptions and Repurchases ..............................14
Section 3. Net Asset Value of Shares.................................15
Section 4. Suspension of the Right of Redemption.....................15
Section 5. Trust's Right to Redeem Shares ...........................15
ARTICLE XI. LIMITATION OF LIABILITY AND INDEMNIFICATION ...................15
Section 1. Limitation of Personal Liability and Indemnification
of Shareholders ........................................15
Section 2. Limitation of Personal Liability and Indemnification of
Trustees, Officers, Employees or Agents of the Trust 16
Section 3. Express Exculpatory Clauses and Instruments ..............16
<PAGE>
Page
ARTICLE XII. MISCELLANEOUS..................................................17
Section 1. Trust is not a Partnership ...............................17
Section 2. Trustee Action Binding, Expert Advice, No Bond or
Surety .................................................17
Section 3. Establishment of Record Dates ............................17
Section 4. Termination of Trust .....................................18
Section 5. Offices of the Trust, Filing of Copies, Headings,
Counterparts ............................................18
Section 6. Applicable Law ...........................................18
Section 7. Amendments -- General ....................................19
Section 8. Amendments -- Series and Classes..........................19
Section 9. Use of Name ..............................................20
<PAGE>
GREAT PLAINS FUNDS
DECLARATION OF TRUST
Dated June 12, 1997
DECLARATION OF TRUST, made by the undersigned, and by the holders of shares of
beneficial interest to be issued hereunder as hereinafter provided.
WHEREAS, the Trustees desire to establish a trust fund for the investment and
reinvestment of funds contributed thereto;
NOW, THEREFORE, the Trustees declare that all money and property contributed to
the trust fund hereunder shall be held and managed under this Declaration of
Trust IN TRUST as herein set forth below.
ARTICLE I
NAMES AND DEFINITIONS
Section 1. Name. This Trust shall be known as the Great Plains Funds, and
the Trustees may conduct the business of the Trust under that name or any other
name as they may determine from time to time. ----
Section 2. Definitions. Wherever used herein, unless otherwise required by
the context or specifically provided:
(a) The terms "Affiliated Person," "Assignment," "Commission," "Interested
Person," "Majority Shareholder Vote" (the 67% or 50% requirement of Section
2(a)(42) of the 1940 Act, whichever may be applicable) and "Principal
Underwriter" shall have the meanings given them in the 1940 Act, as amended from
time to time;
(b) The "Trust" refers to the Massachusetts Business Trust established by
this Declaration of Trust, as amended from time to time, inclusive of each and
every Series and Class established hereunder;
(c) "Class" refers to a class of Shares established and designated under or
in accordance with the provisions of Article III;
(d) "Series" refers to a series of Shares established and designated under
or in accordance with the provisions of Article III;
(e) "Series Company" refers to the form of a registered open-end investment
company described in Section 18(f)(2) of the 1940 Act or in any successor
statutory provision;
(f) "Shareholder" means a record owner of Shares of any Series or Class;
(g) "Trustees" refer to the individual Trustees in their capacity as
Trustees hereunder of the Trust and their successor or successors for the time
being in office as such Trustees;
(h) "Shares" means the equal proportionate units of interest into which the
beneficial interest in the Trust shall be divided from time to time, or if more
than one Series or Class of Shares is authorized by the Trustees, the equal
proportionate units into which each Series or Class of Shares shall be divided
from time to time and includes fractions of Shares as well as whole Shares;
(i) The "1940 Act" refers to the Investment Company Act of 1940, and the
Rules and Regulations thereunder, (including any exemptions granted thereunder)
as amended from time to time; and
(j) "Bylaws" shall mean the Bylaws of the Trust as amended from time to
time.
ARTICLE II
PURPOSE OF TRUST
The purpose of this Trust is to operate as an investment company, and provide
investors a continuous source of managed investments by investing primarily in
securities, derivative securities, and also in debt instruments, commodities,
commodity contracts and options thereon, and other property.
ARTICLE III
BENEFICIAL INTEREST
Section 1. Shares of Beneficial Interest. The beneficial interest in the Trust
shall at all times be divided into transferable Shares, without par
value. Subject to the provisions of Section 5 of this Article III, each
Share shall have voting rights as provided in Article VIII hereof, and
holders of the Shares of any Series shall be entitled to receive
dividends, when and as declared with respect thereto in the manner
provided in Article X, Section 1 hereof. The Shares of any Series may
be issued in one or more Classes, as the Trustees may authorize
pursuant to Article XII, Section 8 hereof. Unless the Trustees have
authorized the issuance of Shares of a Series in two or more Classes,
each Share of a Series shall represent an equal proportionate interest
in the assets and liabilities and the income and the expenses of the
Series with each other Share of the same Series, none having priority
or preference over another. If the Trustees have authorized the
issuance of Shares of a Series in two or more Classes, then the Classes
may have such variations as to dividend, redemption, and voting rights,
net asset values, expenses borne by the Classes, and other matters as
the Trustees have authorized provided that each Share of a Class shall
represent an equal proportionate interest in the assets and liabilities
and the income and the expenses of the Class with each other Share of
the same Class, none having priority or preference over another. The
number of Shares authorized shall be unlimited. The Trustees may from
time to time divide or combine the Shares of any Series or Class into a
greater or lesser number without thereby changing the proportionate
beneficial interests in the Series or Class.
Section 2. Ownership of Shares. The ownership of Shares shall be recorded in
the books of the Trust or a transfer agent which books shall be
maintained separately for the Shares of each Series or Class. The
Trustees may make such rules as they consider appropriate for the
transfer of Shares and similar matters. The record books of the Trust
or any transfer agent, as the case may be, shall be conclusive as to
who are the Shareholders of each Series or Class and as to the number
of Shares of each Series or Class held from time to time by each.
Section 3. Investment in the Trust. The Trustees shall accept investments in
the Trust from such persons and on such terms as they may from time to
time authorize. After the date of the initial contribution of capital
(which shall occur prior to the initial public offering of Shares), the
number of Shares to represent the initial contribution shall be
considered as outstanding and the amount received by the Trustees on
account of the contribution shall be treated as an asset of the Trust
to be allocated among any Series or Classes in the manner described in
Section 5(a) of this Article. Subsequent to such initial contribution
of capital, Shares (including Shares which may have been redeemed or
repurchased by the Trust) may be issued or sold at a price which will
net the relevant Series or Class, as the case may be, before paying any
taxes in connection with such issue or sale, not less than the net
asset value (as defined in Article X, Section 3) thereof; provided,
however, that the Trustees may in their discretion impose a sales
charge upon investments in or redemptions from the Trust, and upon
reinvestments of dividends and capital gains in Shares.
Section 4. No Pre-emptive Right; Action by Shareholder. Shareholders shall have
no pre-emptive or other right to subscribe to any additional Shares or
other securities issued by the Trust. No action may be brought by a
Shareholder on behalf of the Trust unless a prior demand regarding such
matter has been made on the Trustees of the Trust.
Section 5. Establishment and Designation of Series or Class. Without limiting
the authority of the Trustees set forth in Article XII, Section 8,
inter alia, to establish and designate any additional Series or Class
or to modify the rights and preferences of any existing Series or
Class, the initial Series shall be, and is established and designated
as: Great Plains Equity Fund, Great Plains International Equity Fund,
Great Plains Tax Free Bond Fund, Great Plains Intermediate Bond Fund
and Great Plains Premier Fund.
Shares of any Series or Class established in this Section 5 shall have
the following relative rights and preferences:
(a) Assets belonging to Series or Class. All consideration received by the
Trust for the issue or sale of Shares of a particular Series or Class, together
with all assets in which such consideration is
- ----------------------------------- invested or reinvested, all income,
earnings, profits, and proceeds thereof from whatever source derived, including,
without limitation, any proceeds derived from the sale, exchange or liquidation
of such assets, and any funds or payments derived from any reinvestment of such
proceeds in whatever form the same may be, shall irrevocably belong to that
Series or Class for all purposes, subject only to the rights of creditors, and
shall be so recorded upon the books of account of the Trust. Such consideration,
assets, income, earnings, profits and proceeds thereof, from whatever source
derived, including, without limitation, any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or payments derived from
any reinvestment of such proceeds, in whatever form the same may be, are herein
referred to as "assets belonging to" that Series or Class. In the event that
there are any assets, income, earnings, profits and proceeds thereof, funds or
payments which are not readily identifiable as belonging to any particular
Series or Class (collectively "General Assets"), the Trustees shall allocate
such General Assets to, between or among any one or more of the Series or
Classes established and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and equitable, and any
General Assets so allocated to a particular Series or Class shall belong to that
Series or Class. Each such allocation by the Trustees shall be conclusive and
binding upon the Shareholders of all Series or Classes for all purposes.
(b) Liabilities Belonging to Series or Class. The assets belonging to each
particular Series or Class shall be charged with the liabilities of the Trust in
respect to that Series or Class and all expenses, costs, charges and reserves
attributable to that Series or Class, and any general liabilities of the Trust
which are not readily identifiable as belonging to any particular Series or
Class shall be allocated and charged by the Trustees to and among any one or
more of the Series or Classes established and designated from time to time in
such manner and on such basis as the Trustees in their sole discretion deem fair
and equitable. The liabilities, expenses, costs, charges and reserves so charged
to a Series or Class are herein referred to as "liabilities belonging to" that
Series or Class. Each allocation of liabilities belonging to a Series or Class
by the Trustees shall be conclusive and binding upon the Shareholders of all
Series or Classes for all purposes.
(c) Dividends, Distributions, Redemptions, Repurchases and
Indemnification. Notwithstanding any other provisions of this
Declaration of Trust, including, without limitation, Article
X, no dividend or distribution (including, without limitation,
any distribution paid upon termination of the Trust or of any
Series or Class) with respect to, nor any redemption or
repurchase of the Shares of any Series or Class shall be
effected by the Trust other than from the assets belonging to
such Series or Class, nor except as specifically provided in
Section 1 of Article XI hereof, shall any Shareholder of any
particular Series or Class otherwise have any right or claim
against the assets belonging to any other Series or Class
except to the extent that such Shareholder has such a right or
claim hereunder as a Shareholder of such other Series or
Class.
(d) Voting. Notwithstanding any of the other provisions of this
Declaration of Trust, including, without limitation, Section 1
of Article VIII, only Shareholders of a particular Series or
Class shall be entitled to vote on any matters affecting such
Series or Class. Except with respect to matters as to which
any particular Series or Class is affected materially
differently or as otherwise required by applicable law, all of
the Shares of each Series or Class shall, on matters as to
which such Series or Class is entitled to vote, vote with
other Series or Classes so entitled as a single class.
Notwithstanding the foregoing, with respect to matters which
would otherwise be voted on by two or more Series or Classes
as a single class, the Trustees may, in their sole discretion,
submit such matters to the Shareholders of any or all such
Series or Classes, separately.
(e) Fraction. Any fractional Share of a Series or Class shall
carry proportionately all the rights and obligations of a
whole Share of that Series or Class, including rights with
respect to voting, receipt of dividends and distributions,
redemption of Shares and termination of the Trust or of any
Series or Class.
(f) Exchange Privilege. The Trustees shall have the authority to
provide that the holders of Shares of any Series or Class
shall have the right to exchange said Shares for Shares of one
or more other Series or Classes in accordance with such
requirements and procedures as may be established by the
Trustees.
(g) Combination of Series or Classes. The Trustees shall have the
authority, without the approval of the Shareholders of any
Series or Class, unless otherwise required by applicable law,
to combine the assets and liabilities belonging to a single
Series or Class with the assets and liabilities of one or more
other Series or Classes.
(h) Elimination of Series or Classes. The Trustees shall have the
authority, without the approval of Shareholders of any Series
or Class, unless otherwise required by applicable law, to
amend this Declaration of Trust to abolish that Series or
Class and to rescind the establishment and designation
thereof.
ARTICLE IV
THE TRUSTEES
Section 1. Management of the Trust. The business and affairs of the Trust
shall be managed by the Trustees, and they shall have all powers necessary and
desirable to carry out that responsibility. The initial -----------------------
Trustees who shall serve as Trustees are the undersigned.
Section 2. Election of Trustees by Shareholders. Unless otherwise required by
the 1940 Act or any court or regulatory body of competent jurisdiction,
or unless the Trustees determine otherwise, a Trustee shall be elected
by the Trustees, and Shareholders shall have no right to elect
Trustees.
Section 3. Term of Office of Trustees. The Trustees shall hold office during
the lifetime of this Trust, and until its termination as hereinafter
provided; except (a) that any Trustee may resign his office at any time
by written instrument signed by him and delivered to the other
Trustees, which shall take effect upon such delivery or upon such later
date as is specified therein; (b) that any Trustee may be removed at
any time by written instrument signed by at least two-thirds of the
number of Trustees prior to such removal, specifying the date when such
removal shall become effective; (c) that any Trustee who requests in
writing to be retired or who has become mentally or physically
incapacitated may be retired by written instrument signed by a majority
of the other Trustees, specifying the date of his retirement; (d) that
a Trustee may be removed at any special meeting of Shareholders of the
Trust by a vote of two-thirds of the outstanding Shares and (e) each
Trustee shall retire at his or her age 80 except that a Trustee who is
an officer of the Trust at that time may continue as a Trustee until
such time as the then current term of office as such officer shall
terminate. Any removals or retirements shall be effective as to the
Trust and each Series and Class hereunder.
Section 4. Termination of Service and Appointment of Trustees. In case of the
death, resignation, retirement, removal or mental or physical
incapacity of any of the Trustees, or in case a vacancy shall, by
reason of an increase in number, or for any other reason, exist, the
remaining Trustees shall fill such vacancy by appointing such other
person as they in their discretion shall see fit. An appointment of a
Trustee may be made by the Trustees then in office in anticipation of a
vacancy to occur by reason of retirement, resignation or increase in
number of Trustees effective at a later date, provided that said
appointment shall become effective only at or after the effective date
of said retirement, resignation or increase in number of Trustees. As
soon as any Trustee so appointed shall have accepted this Trust, the
trust estate shall vest in the new Trustee or Trustees, together with
the continuing Trustees, without any further act or conveyance, and he
shall be deemed a Trustee hereunder. Any appointment authorized by this
Section 4 is subject to the provisions of Section 16(a) of the 1940
Act.
Section 5. Number of Trustees. The number of Trustees, not less than three (3)
nor more than twenty (20) serving hereunder at any time, shall be determined by
the Trustees themselves.
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Whenever a vacancy in the Board of Trustees shall occur, until such
vacancy is filled or while any Trustee is physically or mentally
incapacitated, the other Trustees shall have all the powers hereunder
and the certificate signed by a majority of the other Trustees of such
vacancy, absence or incapacity shall be conclusive, provided, however,
that no vacancy which reduces the number of Trustees below three (3)
shall remain unfilled for a period longer than six calendar months.
Section 6. Effect of Death, Resignation, etc. of a Trustee. The death,
resignation, retirement, removal, or mental or physical incapacity of
the Trustees, or any one or more of them, shall not operate to annul
the Trust or to revoke any existing agency created pursuant to the
terms of this Declaration of Trust.
Section 7. Ownership of Assets. The assets belonging to each Series or Class
shall be held separate and apart from any assets now or hereafter held
in any capacity other than as Trustee hereunder by the Trustees or any
successor Trustee. All of the assets belonging to each Series or Class
or owned by the Trust shall at all times be considered as vested in the
Trustees. No Shareholder shall be deemed to have a severable ownership
interest in any individual asset belonging to any Series or Class or
owned by the Trust or any right of partition or possession thereof, but
each Shareholder shall have a proportionate undivided beneficial
interest in a Series or Class.
ARTICLE V
POWERS OF THE TRUSTEES
Section 1. Powers. The Trustees in all instances shall act as principals, and
are and shall be free from the control of the Shareholders. The
Trustees shall have full power and authority to do any and all acts and
to make and execute any and all contracts and instruments that they may
consider necessary or appropriate in connection with the management of
the Trust or a Series or Class. The Trustees shall not be bound or
limited by present or future laws or customs in regard to trust
investments, but shall have full authority and power to make any and
all investments which they, in their uncontrolled discretion, shall
deem proper to accomplish the purpose of this Trust. Without limiting
the foregoing, the Trustees shall have the following specific powers
and authority, subject to any applicable limitation in the 1940 Act or
in this Declaration of Trust or in the Bylaws of the Trust:
(a) To buy, and invest funds in their hands in, securities and
other property, including, but not limited to, common stocks,
preferred stocks, bonds, debentures, warrants and rights to
purchase securities, options, certificates of beneficial
interest, money market instruments, notes or other evidences
of indebtedness issued by any corporation, trust or
association, domestic or foreign, or issued or guaranteed by
the United States of America or any agency or instrumentality
thereof, by the government of any foreign country, by any
State of the United States, or by any political subdivision or
agency or instrumentality of any State or foreign country, or
"when-issued" or "delayed-delivery" contracts for any such
securities, or any repurchase agreement or reverse repurchase
agreement, or debt instruments, commodities, commodity
contracts and options thereon, or to retain assets belonging
to each and every Series or Class in cash, and from time to
time to change the investments of the assets belonging to each
Series or Class;
(b) To adopt Bylaws of the Trust not inconsistent with the
Declaration of Trust providing for the conduct of the business
of the Trust and to amend and repeal them to the extent that
they do not reserve that right to the Shareholders;
(c) To elect and remove such officers of the Trust and appoint and
terminate such agents of the Trust as they consider
appropriate;
(d) To appoint or otherwise engage a bank or other entity
permitted by the 1940 Act, as custodian of any assets
belonging to any Series or Class subject to any conditions set
forth in this Declaration of Trust or in the Bylaws;
(e) To appoint or otherwise engage transfer agents, dividend
disbursing agents, Shareholder servicing agents, investment
advisers, sub-investment advisers, principal underwriters,
administrative service agents, and such other agents as the
Trustees may from time to time appoint or otherwise engage;
(f) To provide for the distribution of any Shares of any Series or
Class either through a Principal Underwriter in the manner
hereinafter provided for or by the Trust itself, or both;
(g) To set record dates in the manner hereinafter provided for;
(h) To delegate such authority as they consider desirable to a
committee or committees composed of Trustees, including
without limitation, an Executive Committee, or to any officers
of the Trust and to any agent, custodian or underwriter;
(i) To sell or exchange any or all of the assets belonging to one
or more Series or Classes, subject to the provisions of
Article XII, Section 4(b) hereof;
(j) To vote or give assent, or exercise any rights of ownership,
with respect to stock or other securities or property; and to
execute and deliver powers of attorney to such person or
persons, including the investment adviser of the Trust as the
Trustees shall deem proper, granting to such person or persons
such power and discretion with relation to securities or
property as the Trustees shall deem proper;
(k) To exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities or
other property;
(l) To hold any security or property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable
form; or either in its own name or in the name of a custodian
or a nominee or nominees, subject in either case to proper
safeguards according to the usual business practice of
Massachusetts business trusts or investment companies;
(m) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or
concern, any security of which belongs to any Series or Class;
to consent to any contract, lease, mortgage, purchase, or sale
of property by such corporation or concern, and to pay calls
or subscriptions with respect to any security which belongs to
any Series or Class;
(n) To engage in and to prosecute, compound, compromise, abandon,
or adjust, by arbitration or otherwise, any actions, suits,
proceedings, disputes, claims, demands, and things relating to
the Trust, and out of the assets belonging to any Series or
Class to pay, or to satisfy, any debts, claims or expenses
incurred in connection therewith, including those of
litigation, upon any evidence that the Trustees may deem
sufficient (such powers shall include without limitation any
actions, suits, proceedings, disputes, claims, demands and
things relating to the Trust wherein any of the Trustees may
be named individually and the subject matter of which arises
by reason of business for or on behalf of the Trust);
(o) To make distributions to Shareholders;
(p) To borrow money;
(q) From time to time to issue and sell the Shares of any Series
or Class either for cash or for property whenever and in such
amounts as the Trustees may deem desirable, but subject to the
limitation set forth in Section 3 of Article III.
(r) To purchase insurance of any kind, including, without
limitation, insurance on behalf of any person who is or was a
Trustee, officer, employee or agent of the Trust, or is or was
serving at the request of the Trust as a trustee, director,
officer, agent or employee of another corporation,
partnership, joint venture, trust or other enterprise, against
any liability asserted against him or incurred by him in any
such capacity or arising out of his status as such;
(s) To sell, exchange, lend, pledge, mortgage, hypothecate, lease,
or write options with respect to or otherwise deal in any
property rights relating to any or all of the assets belonging
to any Series or Class;
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The Trustees shall have all of the powers set forth in this Section 1
with respect to all assets and liabilities of each Series and Class.
Section 2. Principal Transactions. The Trustees shall not cause the Trust on
behalf of any Series or Class to buy any securities (other than Shares)
from or sell any securities (other than Shares) to, or lend any assets
belonging to any Series or Class to any Trustee or officer or employee
of the Trust or any firm of which any such Trustee or officer is a
member acting as principal unless permitted by the 1940 Act, but the
Trust may employ any such other party or any such person or firm or
company in which any such person is an interested person in any
capacity not prohibited by the 1940 Act.
Section 3. Trustees and Officers as Shareholders. Any Trustee, officer,
employee or other agent of the Trust may acquire, own and dispose of
Shares of any Series or Class to the same extent as if he were not a
Trustee, officer, employee or agent; and the Trustees may issue and
sell or cause to be issued or sold Shares of any Series or Class to and
buy such Shares from any such person or any firm or company in which he
is an interested person subject only to the general limitations herein
contained as to the sale and purchase of such Shares; and all subject
to any restrictions which may be contained in the Bylaws.
Section 4. Parties to Contract. The Trustees may enter into any contract of the
character described in Article VII or in Article IX hereof or any other
capacity not prohibited by the 1940 Act with any corporation, firm,
partnership, trust or association, although one or more of the
shareholders, Trustees, officers, employees or agents of the Trust or
their affiliates may be an officer, director, trustee, partner,
shareholder or interested person of such other party to the contract,
and no such contract shall be invalidated or rendered voidable by
reason of the existence of any such relationship, nor shall any person
holding such relationship be liable merely by reason of such
relationship for any loss or expense to the Trust or any Series or
Class under or by reason of said contract or accountable for any profit
realized directly or indirectly therefrom, in the absence of actual
fraud. The same person (including a firm, corporation, partnership,
trust or association) may be the other party to contracts entered into
pursuant to Article VII or Article IX or any other capacity not
prohibited by the 1940 Act, and any individual may be financially
interested or otherwise an interested person of persons who are parties
to any or all of the contracts mentioned in this Section 4.
ARTICLE VI
TRUSTEES' EXPENSES AND COMPENSATION
Section 1. Trustee Reimbursement. The Trustees shall be reimbursed from the
assets belonging to each particular Series or Class for all of such
Trustees' expenses as such expenses are allocated to and among any one
or more of the Series or Classes pursuant to Article III, Section 5(b),
including, without limitation, expenses of organizing the Trust or any
Series or Class and continuing its or their existence; fees and
expenses of Trustees and officers of the Trust; fees for investment
advisory services, administrative services and principal underwriting
services provided for in Article VII, Sections 1, 2 and 3; fees and
expenses of preparing and printing Registration Statements under the
Securities Act of 1933 and the 1940 Act and any amendments thereto;
expenses of registering and qualifying the Trust and any Series or
Class and the Shares of any Series or Class under federal and state
laws and regulations; expenses of preparing, printing and distributing
prospectuses and any amendments thereto sent to shareholders,
underwriters, broker-dealers and to investors who may be considering
the purchase of Shares; expenses of registering, licensing or other
authorization of the Trust or any Series or Class as a broker-dealer
and of its or their officers as agents and salesmen under federal and
state laws and regulations; interest expenses, taxes, fees and
commissions of every kind; expenses of issue (including cost of share
certificates), purchases, repurchases and redemptions of Shares,
including expenses attributable to a program of periodic issue; charges
and expenses of custodians, transfer agents, dividend disbursing
agents, Shareholder servicing agents and registrars; printing and
mailing costs; auditing, accounting and legal expenses; reports to
Shareholders and governmental officers and commissions; expenses of
meetings of Shareholders and proxy solicitations therefor; insurance
expenses; association membership dues and nonrecurring items as may
arise, including all losses and liabilities by them incurred in
administering the Trust and any Series or Class, including expenses
incurred in connection with litigation, proceedings and claims and the
obligations of the Trust under Article XI hereof and the Bylaws to
indemnify its Trustees, officers, employees, shareholders and agents,
and any contract obligation to indemnify Principal Underwriters under
Section 3 of Article VII; and for the payment of such expenses,
disbursements, losses and liabilities, the Trustees shall have a lien
on the assets belonging to each Series or Class prior to any rights or
interests of the Shareholders of any Series or Class. This section
shall not preclude the Trust from directly paying any of the
aforementioned fees and expenses.
Section 2. Trustee Compensation. The Trustees shall be entitled to compensation
from the Trust from the assets belonging to any Series or Class for
their respective services as Trustees, to be determined from time to
time by vote of the Trustees, and the Trustees shall also determine the
compensation of all officers, employees, consultants and agents whom
they may elect or appoint. The Trust may pay out of the assets
belonging to any Series or Class any Trustee or any corporation, firm,
partnership, trust or other entity of which a Trustee is an interested
person for services rendered in any capacity not prohibited by the 1940
Act, and such payments shall not be deemed compensation for services as
a Trustee under the first sentence of this Section 2 of Article VI.
ARTICLE VII
INVESTMENT ADVISER, ADMINISTRATIVE SERVICES,
PRINCIPAL UNDERWRITER AND TRANSFER AGENT
Section 1. Investment Adviser. Subject to a Majority Shareholder Vote by the
relevant Series or Class to the extent such vote is required by law,
the Trustees may in their discretion from time to time enter into an
investment advisory contract whereby the other party to such contract
shall undertake to furnish the Trustees investment advisory services
for such Series or Class upon such terms and conditions and for such
compensation as the Trustees may in their discretion determine. Subject
to a Majority Shareholder Vote by the relevant Series or Class to the
extent such vote is required by law, the investment adviser may enter
into a sub-investment advisory contract to receive investment advice
and/or statistical and factual information from the sub-investment
adviser for such Series or Class upon such terms and conditions and for
such compensation as the Trustees, in their discretion, may agree.
Notwithstanding any provisions of this Declaration of Trust, the
Trustees may authorize the investment adviser or sub-investment adviser
or any person furnishing administrative personnel and services as set
forth in Article VII, Section 2 (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect
purchases, sales or exchanges of portfolio securities belonging to a
Series or Class on behalf of the Trustees or may authorize any officer,
employee or Trustee to effect such purchases, sales, or exchanges
pursuant to recommendations of the investment adviser (and all without
further action by the Trustees). Any such purchases, sales and
exchanges shall be deemed to have been authorized by the Trustees. The
Trustees may also authorize the investment adviser to determine what
firms shall be employed to effect transactions in securities for the
account of a Series or Class and to determine what firms shall
participate in any such transactions or shall share in commissions or
fees charged in connection with such transactions.
Section 2. Administrative Services. The Trustees may in their discretion from
time to time contract for administrative personnel and services whereby
the other party shall agree to provide the Trustees administrative
personnel and services to operate the Trust or a Series or Class on a
daily basis, on such terms and conditions as the Trustees may in their
discretion determine. Such services may be provided by one or more
entities.
Section 3. Principal Underwriter. The Trustees may in their discretion from
time to time enter into an exclusive or nonexclusive contract or
contracts providing for the sale of the Shares of a Series or Class to
net such Series or Class not less than the amount provided in Article
III, Section 3 hereof, whereby a Series or Class may either agree to
sell the Shares to the other party to the contract or appoint such
other party its sales agent for such shares. In either case, the
contract shall be on such terms and conditions (including
indemnification of Principal Underwriters allowable under applicable
law and regulation) as the Trustees may in their discretion determine
not inconsistent with the provisions of this Article VII; and such
contract may also provide for the repurchase or sale of Shares of a
Series or Class by such other party as principal or as agent of the
Trust and may provide that the other party may maintain a market for
shares of a Series or Class.
Section 4. Transfer Agent. The Trustees may in their discretion from time to
time enter into transfer agency and Shareholder services contracts
whereby the other party shall undertake to furnish transfer agency and
Shareholder services. The contracts shall be on such terms and
conditions as the Trustees may in their discretion determine not
inconsistent with the provisions of this Declaration of Trust or of the
Bylaws.
Such services may be provided by one or more entities.
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 1. Voting Powers. Subject to the provisions set forth in Article III,
Section 5(d), the Shareholders shall have power to vote, (i) for the
election of Trustees as provided in Article IV, Section 2; (ii) for the
removal of Trustees as provided in Article IV, Section 3(d); (iii) with
respect to any investment adviser or sub-investment adviser as provided
in Article VII, Section 1; (iv) with respect to the amendment of this
Declaration of Trust as provided in Article XII, Section 7; and (v)
with respect to such additional matters relating to the Trust as may be
required by law, by this Declaration of Trust, or the Bylaws of the
Trust or any regulation of the Trust or the Securities and Exchange
Commission or any State, or as the Trustees may consider desirable.
Each whole Share shall be entitled to one vote as to any matter on
which it is entitled to vote, and each fractional Share shall be
entitled to a proportionate fractional vote. There shall be no
cumulative voting in the election of Trustees. Shares may be voted in
person or by proxy. A proxy with respect to Shares held in the name of
two or more persons shall be valid if executed by any one of them
unless at or prior to exercise of the proxy the Trust receives a
specific written notice to the contrary from any one of them. A proxy
purporting to be executed by or on behalf of a Shareholder shall be
deemed valid unless challenged at or prior to its exercise and the
burden of proving invalidity shall rest on the challenger. At all
meetings of Shareholders, unless inspectors of election have been
appointed, all questions relating to the qualification of votes and the
validity of proxies and the acceptance or rejection of votes shall be
decided by the chairman of the meeting. Unless otherwise specified in
the proxy, the proxy shall apply to all shares of the Trust (or each
Series or Class) owned by the Shareholder. Any proxy may be in written
form, telephonic or electronic form, including facsimile, and all such
forms shall be valid when in conformance with procedures established
and implemented by the officers of the Trust. Until Shares of a Series
or Class are issued, the Trustees may exercise all rights of
Shareholders of such Series or Class with respect to matters affecting
such Series or Class, and may take any action with respect to the Trust
or such Series or Class required or permitted by law, this Declaration
of Trust or any Bylaws of the Trust to be taken by Shareholders.
Section 2. Meetings. A Shareholders' meeting shall be held as specified in
Section 2 of Article IV at the principal office of the Trust or such
other place as the Trustees may designate. Special meetings of the
Shareholders may be called by the Trustees or the Chief Executive
Officer of the Trust and shall be called by the Trustees upon the
written request of Shareholders owning at least one-tenth of the
outstanding Shares of all Series and Classes entitled to vote.
Shareholders shall be entitled to at least fifteen days' notice of any
meeting.
Section 3. Quorum and Required Vote. Except as otherwise provided by law, the
presence in person or by proxy of the holders of (a) one-half of the
Shares of the Trust on all matters requiring a Majority Shareholder
Vote, as defined in the Investment Company Act of 1940, or (b)
one-third of the Shares of the Trust on all other matters permitted by
law, in each case, entitled to vote without regard to Class shall
constitute a quorum at any meeting of the Shareholders, except with
respect to any matter which by law requires the separate approval of
one or more Series or Classes, in which case the presence in person or
by proxy of the holders of one-half or one-third, as set forth above,
of the Shares of each Series or Class entitled to vote separately on
the matter shall constitute a quorum. When any one or more Series or
Class is entitled to vote as a single Series or Class, more than
one-half, or one-third, as appropriate, of the Shares of each such
Series or Class entitled to vote shall constitute a quorum at a
Shareholders' meeting of that Series or Class. If a quorum shall not be
present for the purpose of any vote that may properly come before the
meeting, the Shares present in person or by proxy and entitled to vote
at such meeting on such matter may, by plurality vote, adjourn the
meeting from time to time to such place and time without further notice
than by announcement to be given at the meeting until a quorum entitled
to vote on such matter shall be present, whereupon any such matter may
be voted upon at the meeting as though held when originally convened.
Subject to any applicable requirement of law or of this Declaration of
Trust or the Bylaws, a plurality of the votes cast shall elect a
Trustee, and all other matters shall be decided by a majority of the
votes cast and entitled to vote thereon.
Section 4. Action by Written Consent. Subject to the provisions of the 1940 Act
and other applicable law, any action taken by Shareholders may be taken
without a meeting if a majority of Shareholders entitled to vote on the
matter (or such larger proportion thereof as shall be required by
applicable law or by any express provision of this Declaration of Trust
or the Bylaws) consents to the action in writing. Such consents shall
be treated for all purposes as a vote taken at a meeting of
Shareholders.
Section 5. Additional Provisions. The Bylaws may include further provisions
for Shareholders' votes and meetings and related matters.
ARTICLE IX
CUSTODIAN
The Trustees may, in their discretion, from time to time enter into contracts
providing for custodial and accounting services to the Trust or any Series or
Class. The contracts shall be on the terms and conditions as the Trustees may in
their discretion determine not inconsistent with the provisions of this
Declaration of Trust or of the Bylaws. Such services may be provided by one or
more entities, including one or more sub-custodians.
ARTICLE X
DISTRIBUTIONS AND REDEMPTIONS
Section 1. Distributions.
(a) The Trustees may from time to time declare and pay dividends
to the Shareholders of any Series or Class, and the amount of
such dividends and the payment of them shall be wholly in the
discretion of the Trustees. The frequency of dividends and
distributions to Shareholders may be determined by the
Trustees pursuant to a standing resolution, or otherwise. Such
dividends may be accrued and automatically reinvested in
additional Shares (or fractions thereof) of the relevant
Series or Class or another Series or Class, or paid in cash or
additional Shares of the relevant Series or Class, all upon
such terms and conditions as the Trustees may prescribe.
(b) The Trustees may distribute in respect of any fiscal year as
dividends and as capital gains distributions, respectively,
amounts sufficient to enable any Series or Class to qualify as
a regulated investment company and to avoid any liability for
federal income or excise taxes in respect of that year.
c) The decision of the Trustees as to what constitutes income and
what constitutes principal shall be final, and except as
specifically provided herein the decision of the Trustees as
to what expenses and charges of any Series or Class shall be
charged against principal and what against the income shall be
final. Any income not distributed in any year may be permitted
to accumulate and as long as not distributed may be invested
from time to time in the same manner as the principal funds of
any Series or Class.
(d) All dividends and distributions on Shares of a particular
Series or Class shall be distributed pro rata to the holders
of that Series or Class in proportion to the number of Shares
of that Series or Class held by such holders and recorded on
the books of the Trust or its transfer agent at the date and
time of record established for that payment.
Section 2. Redemptions and Repurchases.
(a) In case any Shareholder of record of any Series or Class at any time
desires to dispose of Shares of such Series or Class recorded in his name, he
may deposit a written request (or such other form of request as the Trustees may
from time to time authorize) requesting that the Trust purchase his Shares,
together with such other instruments or authorizations to effect the transfer as
the Trustees may from time to time require, at the office of the transfer agent,
or as otherwise provided by the Trustees and the Trust shall purchase his Shares
out of assets belonging to such Series or Class. The purchase price shall be the
net asset value of his shares reduced by any redemption charge or deferred sales
charge as the Trustees from time to time may determine. Payment for such Shares
shall be made by the Trust to the Shareholder of record within that time period
required under the 1940 Act after the request (and, if required, such other
instruments or authorizations of transfer) is received, subject to the right of
the Trustees to postpone the date of payment pursuant to Section 4 of this
Article X. If the redemption is postponed beyond the date on which it would
normally occur by reason of a declaration by the Trustees suspending the right
of redemption pursuant to Section 4 of this Article X, the right of the
Shareholder to have his Shares purchased by the Trust shall be similarly
suspended, and he may withdraw his request (or such other instruments or
authorizations of transfer) from deposit if he so elects; or, if he does not so
elect, the purchase price shall be the net asset value of his Shares determined
next after termination of such suspension (reduced by any redemption charge or
deferred sales charge), and payment therefor shall be made within the time
period required under the 1940 Act.
(b) The Trust may purchase Shares of a Series or Class by
agreement with the owner thereof at a purchase price not
exceeding the net asset value per Share (reduced by any
redemption charge or deferred sales charge) determined (1)
next after the purchase or contract of purchase is made or (2)
at some later time.
(c) The Trust may pay the purchase price (reduced by any
redemption charge or deferred sales charge) in whole or in
part by a distribution in kind of securities from the
portfolio of the relevant Series or Class, taking such
securities at the same value employed in determining net asset
value, and selecting the securities in such manner as the
Trustees may deem fair and equitable.
Section 3. Net Asset Value of Shares. The net asset value of each Share of a
Series or Class outstanding shall be determined at such time or times
as may be determined by or on behalf of the Trustees. The power and
duty to determine net asset value may be delegated by the Trustees from
time to time to one or more of the Trustees or officers of the Trust,
to the other party to any contract entered into pursuant to Section 1
or 2 of Article VII or to the custodian or to a transfer agent or other
person designated by the Trustees.
The net asset value of each Share of a Series or Class as of any
particular time shall be the quotient (adjusted to the nearer cent)
obtained by dividing the value, as of such time, of the net assets
belonging to such Series or Class (i.e., the value of the assets
belonging to such Series or Class less the liabilities belonging to
such Series or Class exclusive of capital and surplus) by the total
number of Shares outstanding of the Series or Class at such time in
accordance with the requirements of the 1940 Act and applicable
provisions of the Bylaws of the Trust in conformity with generally
accepted accounting practices and principles.
The Trustees may declare a suspension of the determination of net asset
value for the whole or any part of any period in accordance with the 1940 Act.
Section 4. Suspension of the Right of Redemption. The Trustees may declare
a suspension of the right of redemption or postpone the date of payment for the
whole or any part of any period in accordance with the 1940
- ------------------------------------- Act.
Section 5. Trust's Right to Redeem Shares. The Trust shall have the right to
cause the redemption of Shares of any Series or Class in any
Shareholder's account for their then current net asset value and
promptly make payment to the shareholder (which payment may be reduced
by any applicable redemption charge or deferred sales charge), if (a)
at any time the total investment in the account does not have a minimum
dollar value determined from time to time by the Trustees in their sole
discretion, (b) at any time a Shareholder fails to furnish certified
Social Security or Tax Identification Numbers, or (c) at any time the
Trustees determine in their sole discretion that failure to so redeem
may have materially adverse consequences to the other Shareholders or
the Trust or any Series or Class thereof.
ARTICLE XI
LIMITATION OF LIABILITY AND INDEMNIFICATION
Section 1. Limitation of Personal Liability and Indemnification of
Shareholders. The Trustees, officers, employees or agents of the Trust
shall have no power to bind any Shareholder of any Series or Class
personally or to call upon such Shareholder for the payment of any sum
of money or assessment whatsoever, other than such as the Shareholder
may at any time agree to pay by way of subscription for any Shares or
otherwise.
No Shareholder or former Shareholder of any Series or Class shall be
liable solely by reason of his being or having been a Shareholder for
any debt, claim, action, demand, suit, proceeding, judgment, decree,
liability or obligation of any kind, against or with respect to the
Trust or any Series or Class arising out of any action taken or omitted
for or on behalf of the Trust or such Series or Class, and the Trust or
such Series or Class shall be solely liable therefor and resort shall
be had solely to the property of the relevant Series or Class of the
Trust for the payment or performance thereof.
Each Shareholder or former Shareholder of any Series or Class (or their
heirs, executors, administrators or other legal representatives or, in
case of a corporation or other entity, its corporate or other general
successor) shall be entitled to be held harmless from and indemnified
against to the full extent of such liability and the costs of any
litigation or other proceedings in which such liability shall have been
determined, including, without limitation, the fees and disbursements
of counsel if, contrary to the provisions hereof, such Shareholder or
former Shareholder of such Series or Class shall be held to be
personally liable. Such indemnification shall come exclusively from the
assets of the relevant Series or Class.
The Trust shall, upon request by a Shareholder or former Shareholder,
assume the defense of any claim made against any Shareholder for any
act or obligation of the Trust or any Series or Class and satisfy any
judgment thereon.
Section 2. Limitation of Personal Liability and Indemnification of Trustees,
Officers, Employees or Agents of the Trust. No Trustee, officer,
employee or agent of the Trust shall have the power to bind any other
Trustee, officer, employee or agent of the Trust personally. The
Trustees, officers, employees or agents of the Trust in incurring any
debts, liabilities or obligations, or in taking or omitting any other
actions for or in connection with the Trust, are, and each shall be
deemed to be, acting as Trustee, officer, employee or agent of the
Trust and not in his own individual capacity.
Trustees and officers of the Trust shall be liable for their willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of the office of Trustee or officer, as
the case may be, and for nothing else.
Each person who is or was a Trustee, officer, employee or agent of the
Trust shall be entitled to indemnification out of the assets of the
Trust (or of any Series or Class) to the extent provided in, and
subject to the provisions of, the Bylaws, provided that no
indemnification shall be granted in contravention of the 1940 Act.
Section 3. Express Exculpatory Clauses and Instruments.
(a) All persons extending credit to, contracting with or having
any claim against the Trust or a particular Series or Class
shall only look to the assets of the Trust or the assets of
that particular Series or Class for payment under such credit,
contract or claim; and neither the Shareholders nor the
Trustees, nor any of the Trust's officers, employees or
agents, whether past, present or future, shall be liable
therefor.
(b) The Trustees shall use every reasonable means to assure that all
persons having dealings with the Trust or any Series or Class shall be informed
that the property of the Shareholders and the Trustees, officers, employees and
agents of the Trust or any Series or Class shall not be subject to claims
against or obligations of the Trust or any other Series or Class to any extent
whatsoever. The Trustees shall cause to be inserted in any written agreement,
undertaking or obligation made or issued on behalf of the Trust or any Series or
Class (including certificates for Shares of any Series or Class) an appropriate
reference to the provisions of this Declaration of Trust, providing that neither
the Shareholders, the Trustees, the officers, the employees nor any agent of the
Trust or any Series or Class shall be liable thereunder, and that the other
parties to such instrument shall look solely to the assets belonging to the
relevant Series or Class for the payment of any claim thereunder or for the
performance thereof; but the omission of such provisions from any such
instrument shall not render any Shareholder, Trustee, officer, employee or agent
liable, nor shall the Trustee, or any officer, agent or employee of the Trust or
any Series or Class be liable to anyone for such omission. If, notwithstanding
this provision, any Shareholder, Trustee, officer, employee or agent shall be
held liable to any other person by reason of the omission of such provision from
any such agreement, undertaking or obligation, the Shareholder, Trustee,
officer, employee or agent shall be indemnified and reimbursed by the Trust.
ARTICLE XII
MISCELLANEOUS
Section 1. Trust is not a Partnership. It is hereby expressly declared that a
trust and not a partnership is created hereby.
Section 2. Trustee Action Binding, Expert Advice, No Bond or Surety. The
exercise by the Trustees of their powers and discretions hereunder
shall be binding upon everyone interested. Subject to the provisions of
Article XI, the Trustees shall not be liable for errors of judgment or
mistakes of fact or law. The Trustees may take advice of counsel or
other experts with respect to the meaning and operation of this
Declaration of Trust, and subject to the provisions of Article XI,
shall be under no liability for any act or omission in accordance with
such advice or for failing to follow such advice. The Trustees shall
not be required to give any bond as such, nor any surety if a bond is
required.
Section 3. Establishment of Record Dates. The Trustees may close the Share
transfer books of the Trust maintained with respect to any Series or
Class for a period not exceeding ninety (90) days preceding the date of
any meeting of Shareholders of the Trust or any Series or Class, or the
date for the payment of any dividend or the making of any distribution
to Shareholders, or the date for the allotment of rights, or the date
when any change or conversion or exchange of Shares of any Series or
Class shall go into effect or the last day on which the consent or
dissent of Shareholders of any Series or Class may be effectively
expressed for any purpose; or in lieu of closing the Share transfer
books as aforesaid, the Trustees may fix in advance a date, not
exceeding ninety (90) days preceding the date of any meeting of
Shareholders of the Trust or any Series or Class, or the date for the
payment of any dividend or the making of any distribution to
Shareholders of any Series or Class, or the date for the allotment of
rights, or the date when any change or conversion or exchange of Shares
of any Series or Class shall go into effect, or the last day on which
the consent or dissent of Shareholders of any Series or Class may be
effectively expressed for any purpose, as a record date for the
determination of the Shareholders entitled to notice of, and, to vote
at, any such meeting and any adjournment thereof, or entitled to
receive payment of any such dividend or distribution, or to any such
allotment of rights, or to exercise the rights in respect of any such
change, conversion or exchange of shares, or to exercise the right to
give such consent or dissent, and in such case such Shareholders and
only such Shareholders as shall be Shareholders of record on the date
so fixed shall be entitled to such notice of, and to vote at, such
meeting, or to receive payment of such dividend or distribution, or to
receive such allotment or rights, or to change, convert or exchange
Shares of any Series or Class, or to exercise such rights, as the case
may be, notwithstanding, after such date fixed aforesaid, any transfer
of any Shares on the books of the Trust maintained with respect to any
Series or Class. Nothing in the foregoing sentence shall be construed
as precluding the Trustees from setting different record dates for
different Series or Classes.
Section 4. Termination of Trust.
(a) This Trust shall continue without limitation of time but subject to
the provisions of paragraphs (b), (c) and (d) of this Section 4.
(b) The Trustees may, by majority action, with the approval of a
Majority Shareholder Vote of each Series or Class entitled to
vote as determined by the Trustees under Section 5(d) of
Article III, sell and convey the assets of the Trust or any
Series or Class to another trust or corporation. Upon making
provision for the payment of all outstanding obligations,
taxes and other liabilities, accrued or contingent, belonging
to each Series or Class, the Trustees shall distribute the
remaining assets belonging to each Series or Class ratably
among the holders of the outstanding Shares of that Series or
Class. The Trustees shall make a good faith determination that
a conveyance of a part of the assets of a Series or Class is
in the best interest of Shareholders of the relevant Series or
Class.
(c) The Trustees may at any time sell and convert into money all
the assets of the Trust or any Series or Class without
Shareholder approval, unless otherwise required by applicable
law. Upon making provision for the payment of all outstanding
obligations, taxes and other liabilities, accrued or
contingent, belonging to each Series or Class, the Trustees
shall distribute the remaining assets belonging to each Series
or Class ratably among the holders of the outstanding Shares
of that Series or Class.
(d) Upon completion of the distribution of the remaining proceeds
of the remaining assets as provided in paragraphs (b) and (c),
the Trust or the applicable Series or Class shall terminate
and the Trustees shall be discharged of any and all further
liabilities and duties hereunder or with respect thereto and
the right, title and interest of all parties shall be canceled
and discharged.
Section 5. Offices of the Trust, Filing of Copies, Headings, Counterparts. The
Trust shall maintain a usual place of business in Massachusetts, which,
initially, shall be c/o Donnelly, Conroy & Gelhaar, One Post Office
Square, Boston, Massachusetts 02109-2105, and shall continue to
maintain an office at such address unless changed by the Trustees to
another location in Massachusetts. The Trust may maintain other offices
as the Trustees may from time to time determine. The original or a copy
of this instrument and of each declaration of trust supplemental hereto
shall be kept at the office of the Trust where it may be inspected by
any Shareholder. A copy of this instrument and of each supplemental
declaration of trust shall be filed by the Trustees with the
Massachusetts Secretary of State and the Boston City Clerk, as well as
any other governmental office where such filing may from time to time
be required. Headings are placed herein for convenience of reference
only and in case of any conflict, the text of this instrument, rather
than the headings shall control. This instrument may be executed in any
number of counterparts each of which shall be deemed an original.
Section 6. Applicable Law. The Trust set forth in this instrument is created
under and is to be governed by and construed and administered according
to the laws of The Commonwealth of Massachusetts. The Trust shall be of
the type commonly called a Massachusetts business trust, and without
limiting the provisions hereof, the Trust may exercise all powers which
are ordinarily exercised by such a trust.
Section 7. Amendments -- General. All rights granted to the Shareholders under
this Declaration of Trust are granted subject to the reservation of the
right to amend this Declaration of Trust as herein provided, except
that no amendment shall repeal the limitations on personal liability of
any Shareholder or Trustee or repeal the prohibition of assessment upon
the Shareholders without the express consent of each Shareholder or
Trustee involved. Subject to the foregoing, the provisions of this
Declaration of Trust (whether or not related to the rights of
Shareholders) may be amended at any time, so long as such amendment
does not adversely affect the rights of any Shareholder with respect to
which such amendment is or purports to be applicable and so long as
such amendment is not in contravention of applicable law, including the
1940 Act, by an instrument in writing signed by a majority of the then
Trustees (or by an officer of the Trust pursuant to the vote of a
majority of such Trustees). Any amendment to this Declaration of Trust
that adversely affects the rights of Shareholders may be adopted at any
time by an instrument signed in writing by a majority of the then
Trustees (or by any officer of the Trust pursuant to the vote of a
majority of such Trustees) when authorized to do so by the vote of the
Shareholders holding a majority of the Shares entitled to vote. Subject
to the foregoing, any such amendment shall be effective as provided in
the instrument containing the terms of such amendment or, if there is
no provision therein with respect to effectiveness, upon the execution
of such instrument and of a certificate (which may be a part of such
instrument) executed by a Trustee or officer to the effect that such
amendment has been duly adopted. Copies of the amendment to this
Declaration of Trust shall be filed as specified in Section 5 of this
Article XII. A restated Declaration of Trust, integrating into a single
instrument all of the provisions of the Declaration of Trust which are
then in effect and operative, may be executed from time to time by a
majority of the Trustees and shall be effective upon filing as
specified in Section 5.
Section 8. Amendments -- Series and Classes. The establishment and designation
of any Series or Class of Shares in addition to those established and
designated in Section 5 of Article III hereof shall be effective upon
the execution by a majority of the then Trustees, without the need for
Shareholder approval, of an amendment to this Declaration of Trust,
taking the form of a complete restatement or otherwise, setting forth
such establishment and designation and the relative rights and
preferences of any such Series or Class, or as otherwise provided in
such instrument.
Without limiting the generality of the foregoing, the Declaration of
the Trust may be amended without the need for Shareholder approval to:
(a) create one or more Series or Classes of Shares (in addition to
any Series or Classes already existing or otherwise) with such
rights and preferences and such eligibility requirements for
investment therein as the Trustees shall determine and
reclassify any or all outstanding Shares as Shares of
particular Series or Classes in accordance with such
eligibility requirements;
(b) combine two or more Series or Classes of Shares into a single
Series or Class on such terms and conditions as the Trustees
shall determine;
(c) change or eliminate any eligibility requirements for
investment in Shares of any Series or Class, including without
limitation the power to provide for the issue of Shares of any
Series or Class in connection with any merger or consolidation
of the Trust with another trust or company or any acquisition
by the Trust of part or all of the assets of another trust or
company;
(d) change the designation of any Series or Class of Shares;
(e) change the method of allocating dividends among the various
Series and Classes of Shares;
(f) allocate any specific assets or liabilities of the Trust or
any specific items of income or expense of the Trust to one or
more Series and Classes of Shares; and
(g) specifically allocate assets to any or all Series or Classes
of Shares or create one or more additional Series or Classes
of Shares which are preferred over all other Series or Classes
of Shares in respect of assets specifically allocated thereto
or any dividends paid by the Trust with respect to any net
income, however determined, earned from the investment and
reinvestment of any assets so allocated or otherwise and
provide for any special voting or other rights with respect to
such Series or Classes.
<PAGE>
Section 9. Use of Name. The Trust acknowledges that First Commerce Investors,
Inc. has reserved the right to grant the non-exclusive use of the name
Great Plains Funds or any derivative thereof to any other investment
company, investment company portfolio, investment adviser, distributor,
or other business enterprise, and to withdraw from the Trust or one or
more Series or Classes any right to the use of the name Great Plains
Funds.
IN WITNESS WHEREOF, the undersigned have executed this instrument as of the day
and year first above written.
/s/ Anne Hansen /s/ Timothy S. Johnson
Anne Hansen Timothy S. Johnson
/s/ Victor R. Siclalri /s/ C. Christine Thomson
Victor R. Siclari C. Christine Thomson
<PAGE>
COMMONWEALTH OF PENNSYLVANIA )
: ss:
COUNTY OF ALLEGHENY )
I hereby certify that on July 1, 1997, before me, the subscriber, a
Notary Public of the Commonwealth of Pennsylvania, in for the County of
Allegheny, personally appeared Victor R. Siclari, Timothy S. Johnson
and C. Christine Thomson, who acknowledged the foregoing Declaration of
Trust to be their act.
Witness my hand and notarial seal the day and year above written.
/s/ Marie M. Hamm
Notary Public
Notarial Seal
Marie M. Hamm, Notary Public
Plum Boro, Allegheny County
My Commission Expires Oct. 9, 2000
Member, Pennsylvania Association of Notaries
<PAGE>
STATE OF NEBRASKA )
: ss:
COUNTY OF LANCASTER )
I hereby certify that on July 1, 1997, before me, the subscriber, a
Notary Public of the State of Nebraska, in for the County of Lancaster,
personally appeared Anne Hansen, who acknowledged the foregoing
Declaration of Trust to be her act.
Witness my hand and notarial seal the day and year above written.
/s/ Connie Kreikemeier
Notary Public
General Notary-State of Nebraska
Connie Kreikemeier
My Comm. Exp. Apr. 16, 2000
Exhibit 19 under Form N-1A
Exhibit 24 under Item 601/Reg. S-K
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints Victor R. Siclari and Timothy S. Johnson of GREAT PLAINS FUNDS and the
Deputy General Counsel of Federated Services Company, and each of them, their
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution for them and in their
names, place and stead, in any and all capacities, to sign any and all documents
to be filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, by means of the Securities and Exchange Commission's
electronic disclosure system known as EDGAR; and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to sign and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as each of them might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue thereof.
SIGNATURES TITLE DATE
Trustee July 10, 1997
Anne C. Hansen
/s/ C. Christine Thomson Trustee
C. Christine Thomson
/s/ Victor R. Siclari Trustee
Victor R. Siclari
/s/ Timothy S. Johnson Trustee
Timothy S. Johnson
Sworn to and subscribed before me this 10th day of July, 1997
/s/ Nancy H. Beatty
Notary Public
Notarial Seal
Nancy H. Beatty, Notary Public
Pittsburgh, Allegheny County
My Commission Expires Dec. 7, 2000
Member, Pennsylvania Association of Notaries
<PAGE>
Exhibit 19 under Form N-1A
Exhibit 24 under Item 601/Reg. S-K
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints Victor R. Siclari and Timothy S. Johnson of GREAT PLAINS FUNDS and the
Deputy General Counsel of Federated Services Company, and each of them, their
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution for them and in their
names, place and stead, in any and all capacities, to sign any and all documents
to be filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, by means of the Securities and Exchange Commission's
electronic disclosure system known as EDGAR; and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to sign and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as each of them might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue thereof.
SIGNATURES TITLE DATE
/s/ Anne C. Hansen Trustee July 10, 1997
- -------------------------------------------------
Anne C. Hansen
Trustee
C. Christine Thomson
Trustee
Victor R. Siclari
Trustee
Timothy S. Johnson
Sworn to and subscribed before me this 10th day of July, 1997
/s/ Connie Kreikemeier
Notary Public
General Notary-State of Nebraska
Connie Kreikemeier
My Comm. Exp. Apr. 16, 2000
GREAT PLAINS FUNDS
Federated Investors
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
July 11, 1997
EDGAR Operations Branch
Securities and Exchange Commission
Division of Investment Management
450 Fifth Street, Northwest
Washington, DC 20549
RE: GREAT PLAINS FUNDS (the "Trust")
Enclosed are the filing materials for a newly formed investment company
named "Great Plains Funds". The enclosed initial registration statement is filed
on Form N-1A pursuant to the Securities Act of 1933 and the Investment Company
Act of 1940. This Registration Statement and the red-herring Prospectus and
Statement of Additional Information for Great Plains Equity Fund, Great Plains
Premier Fund, Great Plains International Equity Fund, Great Plains Intermediate
Bond Fund and Great Plains Tax-Free Bond Fund are being filed electronically.
The phrases beginning with "Subject to Completion" and the legends have
been incorporated on the respective cover pages and will appear in red ink for
purposes of distribution to prospective shareholders. The cover legend, located
at the bottom of the cover page for purposes of this transmission, will be
placed along the left margin when distributed.
The Trust may be marketed through banks, savings associations or credit
unions.
The Registrant is a series Trust, presently composed of five
fluctuating net asset value portfolios: Great Plains Equity Fund, Great Plains
Premier Fund, Great Plains International Equity Fund, Great Plains Intermediate
Bond Fund and Great Plains Tax-Free Bond Fund (the "Funds"). The Funds are sold
pursuant to a Rule 12b-1 Distribution Plan and a Shareholder Services Plan.
The Registrant will be advised by First Commerce Investors, Inc. The
Registrant's shares will be distributed by Edgewood Services, Inc., a New York
corporation and a wholly owned subsidiary of Federated Investors.
I will be pleased to furnish any further information which you may
request and would appreciate your immediate attention to this filing.
Very truly yours,
/s/ Cathy C. Ryan
Cathy C. Ryan
Compliance Specialist
