As filed with the Securities and Exchange Commission on October 26, 2000.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 7
TO
FORM N-1A
REGISTRATION STATEMENT
UNDER THE INVESTMENT COMPANY ACT OF 1940
UTILITIES STOCK PORTFOLIO
(Exact Name of Registrant as Specified in Charter)
P.O. Box 7177, 6000 Memorial Drive
Dublin, Ohio 43017
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code: 614-766-7000
Donald F. Meeder, P.O. Box 7177, 6000 Memorial Drive, Dublin, OH 43017
(Name and Address of Agent for Service)
Copy to:
James B. Craver
P. O. Box 811
Dover, MA 02030-0811
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EXPLANATORY NOTE
This Amendment No. 7 (the "Amendment") to the Registrant's Registration
Statement on Form N-1A is being filed pursuant to Section 8(b) of the Investment
Company Act of 1940, as amended, in order to include new disclosure in Part A
which reflects that the Registrant reserves the right to pay shareholders
redemption proceeds by a distribution in kind of portfolio securities, rather
than cash. The Amendment does not otherwise affect Part A, Part B, Part C, or
the accompanying exhibits of the Registrant's Registration Statement filed on
May 1, 2000, which are incorporated herein by reference.
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PART A
Responses to Items 1, 2, 3, 5, and 9 have been omitted pursuant to
paragraph 2 of Instruction B of the General Instructions to Form N-1A.
ITEM 4. INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES AND RELATED
RISKS.
The Utilities Stock Portfolio (the "Portfolio") is a diversified, open-end
management investment company which was organized as a trust under the laws of
the State of New York on August 4, 1994.
Beneficial interests in the Portfolio are offered solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the Securities Act of 1933, as amended (the "1933
Act"). Investments in the Portfolio may only be made by investment companies,
insurance company separate accounts, common or commingled trust funds or similar
organizations or entities which are "accredited investors" as defined in
Regulation D under the 1933 Act. This Registration Statement does not constitute
an offer to sell, or the solicitation of an offer to buy, any "security" within
the meaning of the 1933 Act.
The Portfolio's investment adviser is Meeder Asset Management, Inc. (the
"Investment Adviser" or the "Manager"), formerly known as R. Meeder &
Associates, Inc. Miller/Howard Investments, Inc. is the subadviser (the
"Subadviser") for the Portfolio. The investment objective of the Portfolio is to
seek current income and growth of income by investing primarily in equity
securities of domestic and foreign public utility companies; however, the
Portfolio will not invest in electric utilities whose generation of power is
derived from nuclear reactors. The Portfolio also seeks capital appreciation,
but only when consistent with its primary investment objective.
The Portfolio generally invests at least 65% of its total assets in equity
securities of domestic or foreign companies that provide electricity, natural
gas, water, telecommunications or sanitary services to the public. The remaining
35% of the Portfolio's total assets may be invested in debt securities of public
utility companies, or debt or equity securities of other issuers who stand to
benefit from developments in the utilities industry. The Portfolio will not
invest more than 40% of its total assets in the telephone industry. The
Portfolio may invest up to 25% of its total assets in securities of foreign
issuers. The Portfolio will not invest more than 10% of its net assets in
securities that are deemed to be illiquid.
The Portfolio will not invest more than 5% of its total assets in equity
securities of issuers whose debt securities are rated below investment grade,
that is, rated below one of the four highest rating categories by Standard &
Poor's Corporation ("S&P") or Moody's Investors Service, Inc. ("Moody's") or
deemed to be of equivalent quality in the judgment of the Subadviser. Debt
securities rated below investment grade are rated below Baa or BBB.
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The Portfolio may invest in "traditional" derivatives, such as financial
futures contracts and related options as a hedge against changes, resulting from
market conditions, in the value of securities held or intended to be held by the
Portfolio.
The Subadviser uses fundamental analysis to identify those securities that
it believes provide current income and growth of income and secondarily, capital
appreciation, but only when consistent with its primary investment goal.
Fundamental analysis involves assessing a company and its business environment,
management, balance sheet, income statement, anticipated earnings and dividends,
and other related measures of value.
The Subadviser monitors and evaluates the economic and political climate of
the area in which each company is located. The relative weightings among common
stocks, debt securities and preferred stocks will vary from time to time based
upon the Subadviser's judgment of the extent to which investments in each
category will contribute to meeting the Portfolio's investment goal.
The Subadviser emphasizes quality in selecting investments for the
Portfolio, and in addition to looking for high credit ratings, the Subadviser
ordinarily looks for several of the following characteristics: above average
earnings growth; above average growth of book value; an above average balance
sheet; high earnings to debt service coverage; low ratio of dividends to
earnings; high return on equity; low debt to equity ratio; an above-average
rating with respect to government regulation; growing rate base; lack of major
construction programs and strong management.
The Portfolio may invest up to 35% of its total assets in debt securities
of issuers in the public utility industries. Debt securities in which the
Portfolio invests are limited to those rated A or better by S&P or Moody's or
deemed to be of equivalent quality in the judgment of the Subadviser.
During periods when the Subadviser deems it necessary for temporary
defensive purposes, the Portfolio may invest without limit in high quality money
market instruments. These instruments consist of commercial paper, certificates
of deposit, banker's acceptances and other bank obligations, obligations issued
or guaranteed by the U.S. Government, its agencies or instrumentalities, high
grade corporate obligations and repurchase agreements.
The Portfolio, under normal circumstances, will invest 25% or more of its
total assets in securities of public utility companies. This concentration
policy is fundamental and may not be changed without shareholder approval.
RISK FACTORS
Utility stocks are subject to interest rate risk - i.e., price fluctuations
due to changing interest rates. Rising interest rates can be expected to reduce
the fund's net asset value. Because the fund concentrates in a single industry,
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its performance is largely dependent on the industry's performance, which may
differ from that of the overall stock market. Investments in securities of
foreign companies involve additional risks relating to political and economic
developments abroad, including currency fluctuations. As with any mutual fund,
loss of money is a risk of investing in the fund.
Because the Portfolio concentrates its investments in public utility
companies, its performance will depend in large part on conditions in the public
utility industries. Utility stocks have traditionally been popular among more
conservative stock market investors because they have generally paid above
average dividends. However, utility stocks can still be affected by the risks of
the stock market, as well as factors specific to public utility companies.
Governmental regulation of public utility companies can limit their ability to
expand their business or to pass cost increases on to customers. Companies
providing power or energy-related services may also be affected by fuel
shortages or cost increases, environmental protection or energy conservation
regulations, as well as fluctuating demand for their services. Some public
utility companies are facing increased competition, which may reduce their
profits. All of these factors are subject to rapid change, which may affect
utility companies independently from the stock market as a whole.
OTHER INVESTMENTS AND POLICIES
MONEY MARKET INSTRUMENTS. When investing in money market instruments, the
Portfolio will limit its purchases, denominated in U.S. dollars, to the
following securities:
o U.S. Government Securities and Securities of its Agencies and
Instrumentalities.
o Bank Obligations and Instruments Secured Thereby.
o High Quality Commercial Paper--The Portfolio may invest in commercial
paper rated no lower than "A-2" by S&P or "Prime-2" by Moody's, or, if
not rated, issued by a company having an outstanding debt issue rated
at least A by S&P or Moody's.
o Private Placement Commercial Paper--unregistered securities which are
traded in public markets to qualified institutional investors, such as
the Portfolio.
o High Grade Corporate Obligations--obligations rated at least A by S&P
or Moody's.
o Repurchase Agreements--see "Repurchase Agreements" below.
At the discretion of the Subadviser, the Portfolio may employ the following
strategies in pursuing its investment objective.
CURRENCY, OPTIONS AND FUTURES TRANSACTIONS. The Portfolio may use forward
currency contracts, futures contracts, options on securities or options on
futures contracts to implement strategies to attempt to hedge its portfolio,
i.e., reduce the overall level of investment risk normally associated with the
Portfolio. There can be no assurance that such efforts will succeed. These
techniques are described below and are further detailed in Part B.
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To attempt to hedge against adverse movements in exchange rates between
currencies, the Portfolio may enter into forward currency contracts for the
purchase or sale of a specified currency at a specified future date. Such
contracts may involve the purchase or sale of a foreign currency against the
U.S. dollar, or may involve two foreign currencies. The Portfolio may enter into
forward currency contracts either with respect to specific transactions or with
respect to the Portfolio's positions. For example, when the Portfolio
anticipates making a purchase or sale of a security, the Portfolio may enter
into a forward currency contract in order to set the rate at which a currency
exchange transaction related to the purchase or sale will be made. Further, when
the Subadviser believes that a particular currency may decline compared to the
U.S. dollar or another currency, the Portfolio may enter into a forward contract
to sell the currency the Subadviser expects to decline in an amount
approximating the value of some or all of the Portfolio's securities denominated
in a foreign currency. The Portfolio also may write covered call options and
purchase put and call options on currencies to hedge against movements in
exchange rates.
In addition, the Portfolio may write covered call options and purchase put
and call options on equity and debt securities to hedge against the risk of
fluctuations in the prices of securities held by the Portfolio or which the
Subadviser intends to include in the Portfolio. The Portfolio also may write
covered call options and buy put and call options on stock indexes. Such stock
index options serve to hedge against overall fluctuations in the securities
markets generally or in the utilities market sector specifically, rather than
anticipated increases or decreases in the value of a particular security.
Further, the Portfolio may sell stock index futures contracts and may
purchase put options or write covered call options on such futures contracts to
protect against a general stock market decline or a decline in the utilities
market sector that could adversely affect the Portfolio. The Portfolio also may
buy stock index futures contracts and purchase call options on such contracts to
hedge against a general stock market or market sector advance and thereby
attempt to lessen the cost of future securities acquisitions. The Portfolio may
use interest rate futures contracts and options thereon to hedge the debt
portion of the Portfolio against changes in the general level of interest rates.
The Portfolio may write only "covered" call options. An option written on a
security or currency is "covered" when, so long as the Portfolio is obligated
under the option, it owns the underlying security or currency. The Portfolio
will "cover" stock index options and options on futures contracts it writes by
maintaining in a segregated account either marketable securities, which in the
Subadviser's judgment correlate to the underlying index or futures contract or
an amount of cash, U.S. government securities or other liquid, high grade debt
securities equal in value to the amount the Portfolio would be required to pay
were the option exercised.
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Although the Portfolio might not employ any of the foregoing strategies,
its use of forward currency contracts, options and futures would involve certain
investment risks and transaction costs to which it might not otherwise be
subject. These risks include: dependence on the Subadviser's ability to predict
movements in the prices of individual securities, fluctuations in the general
securities markets or in the utilities market sector and movements in interest
rates and currency markets; imperfect correlation between movements in the price
of currency, options, futures contracts or options thereon and movements in the
price of the currency or security hedged or used for cover; the fact that skills
and techniques needed to trade options, futures contracts and options thereon or
to use forward currency contracts are different from those needed to select the
securities in which the Portfolio invests; lack of assurance that a liquid
secondary market will exist for any particular option, futures contract or
option thereon at any particular time; and the possible need to defer closing
out of certain options, futures contracts and options thereon in order to
continue to qualify for the beneficial tax treatment afforded regulated
investment companies under the Internal Revenue Code of 1986, as amended (the
"Internal Revenue Code").
Derivatives are financial instruments whose performance is derived, at
least in part, from the performance of an underlying asset, security or index.
Accordingly, these financial futures contracts, related options and forward
currency contracts used by the Portfolio to implement its hedging strategies are
considered derivatives. The value of derivatives can be affected significantly
by even small market movements, sometimes in unpredictable ways. They do not
necessarily increase risk, and may in fact reduce risk.
SECURITIES LENDING
The Portfolio may lend its portfolio securities to brokers or dealers,
banks or other recognized institutional borrowers of securities, provided that
the borrower at all times maintains cash or equivalent collateral or secures a
letter of credit in favor of the Portfolio in an amount equal to at least 100%
of the market value of the securities loaned. During the time portfolio
securities are on loan, the borrower will pay the Portfolio an amount equivalent
to any dividend or interest paid on such securities and earn additional income,
or the Portfolio may receive an agreed-upon amount of interest income from the
borrower. In accordance with applicable regulatory requirements, the Portfolio
may lend up to 30% of the value of its total assets. The risks in lending
portfolio securities, as well as with other extensions of secured credit,
consist of possible delay in receiving additional collateral or in recovery of
the securities or possible loss of rights in the collateral should the borrower
fail financially.
REPURCHASE AGREEMENTS
The Portfolio may enter into repurchase agreements whereby the seller of a
security agrees to repurchase that security from the Portfolio at a mutually
agreed-upon time and price. The repurchase date is usually within a day or two
of the original purchase, although it may not be for a number of months. The
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resale price is in excess of the purchase price, reflecting an agreed-upon rate
of return effective for the period of time the Portfolio's money is invested in
the security. The Portfolio's repurchase agreements will at all times be fully
collateralized in an amount at least equal to the purchase price, including
accrued interest earned on the underlying securities. The instruments held as
collateral are valued daily, and as the value of instruments declines, the
Portfolio will require additional collateral. If the seller defaults or becomes
insolvent and the value of the collateral securing the repurchase agreement
declines, the Portfolio may incur a loss.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
The Portfolio may purchase or sell securities on a when-issued or delayed
delivery basis. When-issued or delayed delivery transactions arise when
securities are purchased or sold by the Portfolio with payment and delivery
taking place as much as a month or more in the future in order to secure what is
considered to be an advantageous price and yield to the Portfolio at the time of
entering into the transaction. The Portfolio's custodian will maintain, in a
segregated account of the Portfolio, cash, U.S. Government securities or other
liquid high-grade debt obligations having a value equal to or greater than the
Portfolio's purchase commitments; the custodian will likewise segregate
securities sold on a delayed delivery basis. The securities so purchased are
subject to market fluctuation and no interest accrues to the purchaser during
the period between purchase and settlement. At the time of delivery of the
securities the value may be more or less than the purchase price and an increase
in the percentage of the Portfolio's assets committed to the purchase of
securities on a when-issued or delayed delivery basis may increase the
volatility of the Portfolio's net asset value.
BORROWING
The Portfolio may borrow an amount up to 33-1/3% of the value of its total
assets (calculated when the loan is made) from banks for temporary or emergency
purposes. The Portfolio may pledge up to 33-1/3% of its assets to secure such
borrowings. The Portfolio may borrow from banks, or from other funds or
portfolios advised by the Manager, if an applicable exemptive order has been
granted, or through reverse repurchase agreements. However, the Portfolio will
not purchase portfolio securities if borrowings exceed 5% of the Portfolio's
total assets.
If the Portfolio borrows money, an investor's share price may be subject to
greater fluctuation until the borrowing is paid off.
ITEM 6. MANAGEMENT, ORGANIZATION AND CAPITAL STRUCTURE.
The Portfolio's Board of Trustees provides broad supervision over the
affairs of the Portfolio. A majority of the Portfolio's Trustees are not
affiliated with the Manager or the Subadviser. Information concerning the
Trustees and officers of the Portfolio appears in Part B.
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The Portfolio has not retained the services of a principal underwriter or
distributor, as interests in the Portfolio are offered solely in private
placement transaction.
The Manager has been an investment adviser to individuals and retirement
plans since 1974 and to mutual funds since 1982. The Manager serves the
Portfolio pursuant to an Investment Advisory Contract under the terms of which
it has agreed to provide an investment program within the limitations of the
Portfolio's investment policies and restrictions, and to furnish all executive,
administrative, and clerical services required for the transaction of Portfolio
business, other than accounting services and services which are provided by the
Portfolio's custodian, transfer agent, independent accountants and legal
counsel, and investment advisory services provided by the Subadviser to the
Portfolio.
The Manager was incorporated in Ohio in 1974 and maintains its principal
offices at 6000 Memorial Drive, Dublin, OH 43017. The Manager is a wholly-owned
subsidiary of Meeder Financial. Meeder Financial is controlled by Robert S.
Meeder, Sr. through ownership of voting common stock. Meeder Financial conducts
business only through its six subsidiaries which are Meeder Asset Management,
Inc.; Mutual Funds Service Co., the Portfolio's transfer agent; Adviser Dealer
Services, Inc., a registered broker-dealer; Opportunities Management Co., a
venture capital investor; Meeder Advisory Services, Inc., a registered
investment adviser and OMCO, Inc., a registered commodity trading adviser and
commodity pool operator.
The Manager earns an annual fee, payable in monthly installments, from the
Portfolio at the rate of 1.00% of the first $50 million, .75% of the next $50
million and .60% in excess of $100 million, of average net assets. These fees
are higher than the fees charged to most other investment companies.
SUBADVISER
Miller/Howard Investments, Inc., 141 Upper Byrdcliffe Road, P. O. Box 549,
Woodstock, New York 12498, serves as the Portfolio's Subadviser under an
Investment Subadvisory Agreement between the Manager and the Subadviser. The
Subadviser furnishes investment advisory services in connection with the
management of the Portfolio. The Manager pays the Subadviser a fee, based on the
value of the average daily net assets of the Portfolio, payable monthly, and
computed at the rate of 0.00% of the first $10 million, .40% of the next $50
million, .30% of the next $40 million, and .25% in excess of $100 million of the
Portfolio's average net assets. The Manager continues to have responsibility for
all investment advisory services in accordance with the investment advisory
contract and supervises the Subadviser's performance of such services.
The Subadviser, a Delaware corporation, is a registered investment adviser
which has been providing investment services to broker-dealers, investment
advisers, employee benefit plans, endowment portfolios, foundations and other
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institutions and individuals since 1984. As of December 31, 1999, the Subadviser
held discretionary investment authority over approximately $272 million of
assets. The Subadviser is controlled by Lowell Miller through ownership of
voting common stock.
PORTFOLIO MANAGER
Lowell Miller, a director and President of the Subadviser, is primarily
responsible for the day-to-day management of the Portfolio. Mr. Miller has been
associated with the Subadviser and its predecessor since 1984, and has managed
the Portfolio since its inception in 1995. Mr. Miller controls the Subadviser
through ownership of voting common stock.
TRANSFER AGENT AND CUSTODIAN
The Portfolio has entered into an Administration and Accounting Services
Agreement with Mutual Funds Service Co., 6000 Memorial Drive, Dublin, Ohio
40317, a wholly-owned subsidiary of Meeder Financial, pursuant to which Mutual
Funds Service Co. provides accounting and transfer agency services to the
Portfolio. The minimum annual fee, payable monthly, for such services for the
Portfolio is $7,500. Subject to the applicable minimum fee, the Portfolio's
annual fee is computed at the rate of .15% of the first $10 million, .10% of the
next $20 million, .02% of the next $50 million and .01% in excess of $80 million
of the Portfolio's average net assets. These fees are reviewable annually by the
Trustees of the Portfolio. For the year ended December 31, 1999 total payments
from the Portfolio to Mutual Funds Service Co. amounted to $36,940.
Pursuant to a Custody Agreement, Firstar acts as the custodian of the
Portfolio's assets. See Part B for more detailed information concerning
custodial arrangements.
ITEM 7. SHAREHOLDER INFORMATION.
CAPITAL STOCK AND OTHER SECURITIES
The Portfolio is organized as a trust under the laws of the State of New
York. Under the Declaration of Trust, the Trustees are authorized to issue
beneficial interests in the Portfolio. Each investor is entitled to a vote in
proportion to the amount of its investment in the Portfolio. Investments in the
Portfolio may not be transferred, but an investor may withdraw all or any
portion of its investment at any time at net asset value. Investors in the
Portfolio (E.G., investment companies, insurance company separate accounts and
common and commingled trust funds) will each be liable for all obligations of
the Portfolio. However, the risk of an investor in the Portfolio incurring
financial loss on account of such liability is limited to circumstances in which
both inadequate insurance existed and the Portfolio itself was unable to meet
its obligations.
The net income of the Portfolio is determined each day on which the New
York Stock Exchange (the "NYSE") is open for trading (and on such other days as
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are deemed necessary in order to comply with Rule 22c-1 under the Investment
Company Act of 1940, as amended (the "1940 Act")) ("Fund Business Day"). This
determination is made once during each such day. All the net income of the
Portfolio, as defined below, so determined is allocated PRO RATA among the
investors in the Portfolio at the time of such determination.
For this purpose the net income of the Portfolio (from the time of the
immediately preceding determination thereof) shall consist of (i) all income
accrued, less the amortization of any premium, on the assets of the Portfolio,
less (ii) all actual and accrued expenses of the Portfolio determined in
accordance with generally accepted accounting principles. Interest income
includes discount earned (including both original issue and market discount) on
discount paper accrued ratably to the date of maturity and any net realized
gains or losses on the assets of the Portfolio.
Investments in the Portfolio have no preemptive or conversion rights and
are fully paid and non-assessable, except as set forth below. The Portfolio is
not required to hold annual meetings of investors but the Portfolio will hold
special meetings of investors when in the judgment of the Trustees it is
necessary or desirable to submit matters for an investor vote. Investors have
the right to communicate with other investors to the extent provided in Section
16(c) of the 1940 Act in connection with requesting a meeting of investors for
the purpose of removing one or more Trustees, which removal requires a
two-thirds vote of the Portfolio's beneficial interests. Investors also have
under certain circumstances the right to remove one or more Trustees without a
meeting. Upon liquidation or dissolution of the Portfolio, investors would be
entitled to share PRO RATA in the net assets of the Portfolio available for
distribution to investors.
Under the anticipated method of operation of the Portfolio, the Portfolio
will not be subject to any income tax. However, each investor in the Portfolio
will be taxable on its share (as determined in accordance with the governing
instruments of the Portfolio) of the Portfolio's taxable income, gain, loss,
deductions and credits in determining its income tax liability. The
determination of such share will be made in accordance with the Internal Revenue
Code and regulations promulgated thereunder.
The Portfolio's assets, income and distributions are managed in such a way
that an investor in the Portfolio will be able to satisfy the requirements of
Subchapter M of the Internal Revenue Code assuming that the investor invested
all of its investable assets in the Portfolio.
Investor inquiries may be directed to Meeder Asset Management, Inc. at 6000
Memorial Drive, Dublin, Ohio 43017.
PURCHASE OF SECURITIES
An investment in the Portfolio may be made without a sales load at the net
asset value next determined after an order is received in "good order" by the
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Portfolio. Net asset value is determined as described in Item 18 of Part B.
There is no minimum initial or subsequent investment in the Portfolio.
However, since the Portfolio intends to be as fully invested at all times as is
reasonably practicable in order to enhance the yield on its assets, investments
must be made in federal funds (I.E., monies credited to the account of the
Portfolio's custodian bank by a Federal Reserve Bank).
The Portfolio reserves the right to cease accepting investments at any time
or to reject any investment order.
Each investor in the Portfolio may add to or reduce its investment in the
Portfolio on each Fund Business Day. As of 4:00 p.m., New York time, on each
such day, the value of each investor's beneficial interest in the Portfolio will
be determined by multiplying the net asset value of the Portfolio by the
percentage, effective for that day, which represents that investor's share of
the aggregate beneficial interests in the Portfolio. Any additions or
reductions, which are to be effected as of 4:00 p.m., New York time, on such
day, will then be effected. The investor's percentage of the aggregate
beneficial interests in the Portfolio will then be recomputed as the percentage
equal to the fraction (i) the numerator of which is the value of such investor's
investment in the Portfolio as of 4:00 p.m., New York time, on such day plus or
minus, as the case may be, the amount of net additions to or reductions in the
investor's investment in the Portfolio effected as of 4:00 p.m., New York time,
on such day, and (ii) the denominator of which is the aggregate net asset value
of the Portfolio as of 4:00 p.m., New York time, on such day, plus or minus, as
the case may be, the amount of net additions to or reductions in the aggregate
investments in the Portfolio by all investors in the Portfolio effected as of
4:00 p.m., New York time, on such day. The percentage so determined will then be
applied to determine the value of the investor's interest in the Portfolio as of
4:00 p.m., New York time, on the following Fund Business Day.
REDEMPTION OR REPURCHASE
An investor in the Portfolio may reduce any portion or all of its
investment at any time at the net asset value next determined after a request in
"good order" is furnished by the investor to the Portfolio. Any such withdrawal
could result in a distribution in kind of portfolio securities (as opposed to a
cash distribution from the Portfolio). A distribution in kind may result in a
less diversified portfolio. The proceeds of a reduction will be paid by the
Portfolio in federal funds normally on the next business day after the reduction
is effected, but in any event within seven days. Investments in the Portfolio
may not be transferred.
The right of any investor to receive payment with respect to any reduction
may be suspended or the payment of the proceeds therefrom postponed during any
period in which the NYSE is closed (other than weekends or holidays) or trading
on such Exchange is restricted, or, to the extent otherwise permitted by the
1940 Act, if an emergency exists.
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The Portfolio has reserved the right to pay redemption proceeds by a
distribution in kind of portfolio securities (rather than cash) in the event of
an emergency or when, in the opinion of the Portfolio or the Adviser, payment in
cash would be harmful to existing investors. In these circumstances, the
securities distributed would be valued at the price used to compute the
Portfolio's net assets and the redeeming investor may incur brokerage and
transaction charges in converting the securities to cash. The Portfolio does not
intend to redeem illiquid securities in kind. If this happens, however, the
redeeming investor may not be able to recover its investment in a timely manner.
ITEM 8. DISTRIBUTION ARRANGEMENTS.
Beneficial interests in the Portfolio are issued solely in private
placement transactions which do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Portfolio may only
be made by investment companies, insurance company separate accounts, common or
commingled trust funds or similar organizations or entities which are
"accredited investors" as defined in Regulation D under the 1933 Act. This
Registration Statement does not constitute an offer to sell, or the solicitation
of an offer to buy, any "security" within the meaning of the 1933 Act.
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SIGNATURES
Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to its Registration Statement on Form
N-1A to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Dublin and State of Ohio on the 26th day of October, 2000.
UTILITIES STOCK PORTFOLIO
By : /s/ Wesley F. Hoag
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Wesley F. Hoag
Vice President
