Filed
with the U.S. Securities and Exchange Commission on October 15,
2009
1933 Act
Registration File No. 333-17391
1940 Act
File No. 811-07959
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
N-1A
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REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
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x
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Pre-Effective
Amendment No. ____
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¨
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Post-Effective
Amendment No. 292
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x
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And
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REGISTRATION
STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
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x
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Amendment
No. 294
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x
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(Check
appropriate box or boxes.)
ADVISORS SERIES
TRUST
(Exact
Name of Registrant as Specified in Charter)
615 East
Michigan Street
Milwaukee,
Wisconsin 53202
(Address
of Principal Executive Offices) (Zip Code)
(Registrant’s
Telephone Numbers, Including Area Code) (414) 765-6609
Douglas
G. Hess, President
Advisors
Series Trust
c/o U.S.
Bancorp Fund Services, LLC
777 East
Wisconsin Avenue, 5th
Floor
Milwaukee,
Wisconsin 53202
(Name and
Address of Agent for Service)
Copies
to:
Domenick
Pugliese, Esq.
Paul,
Hastings, Janofsky & Walker LLP
75 East
55th
Street
New York,
New York 10022
As soon as practical after
the effective date of this Registration Statement
Approximate
Date of Proposed Public Offering
It is
proposed that this filing will become effective
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o
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immediately
upon filing pursuant to paragraph (b)
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o
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on
_______________ pursuant to paragraph (b)
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o
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60
days after filing pursuant to paragraph (a)(1)
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o
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on
_______________ pursuant to paragraph (a)(1)
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ý
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75
days after filing pursuant to paragraph (a)(2)
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o
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on
_______________ pursuant to paragraph (a)(2) of Rule
485.
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If
appropriate, check the following box
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[ ]
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this
post-effective amendment designates a new effective date for a previously
filed post-effective amendment.
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Explanatory
Note: This Post-Effective Amendment No. 292 to the
Registration Statement of Advisors Series Trust (the “Trust”) is being filed for
the purpose of introducing a new series to the Trust: Poplar Forest
Partners Fund. This Prospectus conforms to the Summary Prospectus
Rule as set forth in 17 CFR Parts 230, 232, 239, and 274.
Subject to Completion—Dated October 15, 2009
The information in this Prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This Prospectus is not an offer to sell these securities
and is not soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
Poplar
Forest Partners Fund
A Series of Advisors Series Trust
(the “Trust”)
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Trading
Symbol
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Class
A Shares
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[__]
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Institutional
Class Shares
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[__]
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www.poplarforestllc.com
Prospectus
December
31, 2009
The
Poplar Forest Partners Fund (the “Fund”) seeks long-term growth of
capital. The Fund pursues this objective by investing primarily in
equity securities of underappreciated companies and industries. The
Fund’s investment adviser is Poplar Forest Capital, LLC (the
“Adviser”).
The
U.S. Securities and Exchange Commission has not approved or disapproved these
securities or determined if this Prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
Investment
Objective
The Fund
seeks long-term growth of capital.
Fees
and Expenses of the Fund
This
table describes the fees and expenses that you may pay if you buy and hold Class
A shares and Institutional Class shares of the Fund. You may qualify
for sales charge discounts if you and your family invest, or agree to invest in
the future, at least $50,000 in the Fund’s Class A shares. More
information about these and other discounts is available from your financial
professional and in the “More About Class A Shares” section on page [__] of the
Fund’s statutory Prospectus and the “Breakpoints/Volume Discounts and Sales
Charge Waivers” section on page [__] of the Fund’s Statement of Additional
Information (“SAI”).
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Class
A Shares
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Institutional
Class Shares
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SHAREHOLDER
FEES
(fees
paid directly from your investment)
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Maximum
Sales Charge (Load) Imposed on Purchases (as a percentage of offering
price)
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5.00%
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None
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Maximum
Deferred Sales Charge (Load)
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None
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None
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Redemption
Fee
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None
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None
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ANNUAL
FUND OPERATING EXPENSES
(expenses
that you pay each year as a percentage of the value of your
investment)
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Management
Fees
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1.00%
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1.00%
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Distribution
and Service (Rule 12b-1) Fees
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0.25%
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0.00%
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Other
Expenses(1)
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1.49%
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1.49%
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Total
Annual Fund Operating Expenses
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2.74%
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2.49%
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Less: Fee
Waiver and/or Expense Payment(2)
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-1.49%
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-1.49%
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Net
Annual Fund Operating Expenses
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1.25%
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1.00%
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(1)
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Other
expenses are based on estimated customary Fund expenses for the current
fiscal year.
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(2)
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The
Adviser has contractually agreed to waive a portion or all of its
management fees and/or pay Fund expenses (excluding acquired fund fees and
expenses, interest, taxes and extraordinary expenses) in order to limit
the Net Annual Fund Operating Expenses to 1.25% and 1.00% of average daily
net assets of the Fund’s Class A shares and Institutional Class shares,
respectively. The expense limitation will remain in effect
indefinitely and may be terminated only by the Trust’s Board of Trustees
(the “Board”). The Adviser may request recoupment of previously waived
fees and paid expenses from the Fund for three years from the date they
were waived or paid, subject to the expense
limitation.
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Example. This Example is
intended to help you compare the cost of investing in the Fund with the cost of
investing in other mutual funds. The Example assumes that you invest
$10,000 in the Fund for the time periods indicated and then redeem all of your
shares at the end of those periods. The Example also assumes that
your investment has a 5% return each year, that dividends and distributions are
reinvested, and that the Fund’s operating expenses remain the same (taking into
account all contractual expense limitations). Although your actual
costs may be higher or lower, based on these assumptions your costs would
be:
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1 Year
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3 Years
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Class
A shares
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$621
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$877
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Institutional
Class shares
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$102
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$318
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Portfolio
Turnover. The Fund pays transaction costs, such as
commissions, when it buys and sells securities (or “turns over” its
portfolio). A higher portfolio turnover rate may indicate higher
transaction costs and may result in higher taxes when Fund shares are held in a
taxable account. These costs, which are not reflected in Annual Fund
Operating Expenses or in the Example, affect the Fund’s
performance.
Principal
Investment Strategy
The Fund
seeks to deliver superior, risk-adjusted returns over full market cycles, by
investing primarily in the common stocks of underappreciated companies and
industries. The Fund will generally focus on 25 to 35 companies
(i) with an investment grade debt rating, (ii) with a history of
paying common stock dividends, (iii) with a market capitalization among the
top 1,000 companies in the United States, and (iv) domiciled in the United
States.
In
evaluating investments through bottom up, fundamental analysis, particular
attention is paid to the following factors:
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1.
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Normalized
operating margins;
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2.
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Expected
sustainable revenue and/or asset
growth;
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3.
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Investment
required to achieve expected
growth;
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4.
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Normalized
free cash flow after considering Items 1 through 3 above;
and
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5.
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Valuation
relative to normalized earnings and free cash flow after giving
consideration to growth potential and financial
strength.
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The Fund
may also invest up to 25% of its net assets in government and corporate debt
securities of any maturity. The Fund also may invest up to 15% of its
net assets in foreign equity securities. Additionally, a total of 15% of the
Fund’s net assets may be invested in a combination of convertible securities,
options, warrants and rights and other investment
companies. Investments will be made with an intended investment
horizon of three years, although individual investments may be held for shorter
or longer time periods.
The
decision to sell securities is driven by the Adviser’s evaluation of prospective
future total returns relative to the perceived risk of the security in
question. Securities may be sold when their estimated future return
is low in an absolute sense or if the security has an inferior risk/reward
profile relative to other investment alternatives.
Principal
Investment Risks
Losing
all or a portion of your investment is a risk of investing in the
Fund. The following additional risks could affect the value of your
investment:
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·
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Management Risk – If
the Adviser’s investment strategies do not produce the expected results,
the value of the Fund would
decrease.
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·
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Market Risk – Either
the stock market as a whole, or the value of an individual company, goes
down resulting in a decrease in the value of the
Fund.
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·
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Value-Style Investing
Risk –
Value stocks can perform differently from the market as a whole and from
other types of stocks. Value stocks may be purchased based upon
the belief that a given security may be out of favor; that belief may be
misplaced or the security may stay out of favor for an extended period of
time.
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·
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Debt Securities Risk --
Debt securities, such as notes and bonds, are subject to credit risk and
interest rate risk. Credit risk is the possibility that an
issuer of an instrument will be unable to make interest payments or repay
principal when due. Changes in the financial strength of an
issuer or changes in the credit rating of a security may affect its
value. Interest rate risk is the risk that interest rates may
increase, which tends to reduce the resale value of certain debt
securities, including U.S. Government
obligations.
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·
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New Fund Risk - The Fund is new with
no operating history and there can be no assurance that the Fund will grow
to or maintain an economically viable size, in which case the Board may
determine to liquidate the Fund.
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·
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Medium Sized Companies Risk
– Investing in securities of medium-sized companies may involve
greater risk than investing in larger, more established companies because
they can be subject to greater share price volatility than larger, more
established companies.
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·
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Foreign Securities Risk
– Foreign securities can be more volatile than domestic (U.S.)
securities. Securities markets of other countries are generally
smaller than U.S. securities markets. Many foreign securities
may also be less liquid than U.S. securities, which could affect the
Fund’s investments.
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The Fund
may be appropriate for investors who:
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•
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are
pursuing long-term growth of
capital;
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•
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want
to add an investment with growth potential to diversify their investment
portfolio;
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•
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can
accept the greater risks of investing in a portfolio with significant
common stock holdings;
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•
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are
not seeking regular income; and
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•
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are
not pursuing short-term goals.
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Performance
When the
Fund has been in operation for a full calendar year, performance information
will be shown here. Updated performance information will be available
on the Fund’s website at www.poplarforestllc.com or by calling the Fund
toll-free at 1-[8__]-[___]-[____].
Management
Investment Adviser. Poplar Forest
Capital, LLC is the Fund’s investment adviser.
Portfolio Manager. J. Dale Harvey
(CEO and Chief Investment
Officer) is the portfolio manager for the Fund and has managed the Fund
since its inception in 2009.
Purchase
and Sale of Fund Shares
You may
purchase or redeem Fund shares on any business day by written request via mail
(Poplar Forest Partners Fund, c/o U.S. Bancorp Fund Services, LLC, P.O. Box 701,
Milwaukee, WI 53201-0701), by wire transfer, by telephone at 1-[8__]-[___]-[____],
or through a financial intermediary. Purchases and redemptions by
telephone are only permitted if you previously established these options on your
account.
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Minimum Investments
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To
Open
Your Account
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To
Add to
Your Account
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Class
A Shares
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Regular
Accounts
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$25,000
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$5,000
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Individual
Retirement Accounts (“IRA”) (Traditional, Roth, SEP, and SIMPLE
IRAs)
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$5,000
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$500
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Institutional Shares
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Regular
Accounts
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$1,000,000
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$5,000
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Tax
Information
The
Fund’s distributions are taxable, and will be taxed as ordinary income or
capital gains, unless you are investing through a tax-deferred arrangement, such
as a 401(k) plan or an individual retirement account.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase the Fund through a broker-dealer or other financial intermediary (such
as a bank or financial advisor), the Fund and/or its Adviser may pay the
intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other financial intermediary and your salesperson to recommend the Fund over
another investment. Ask your salesperson or visit your financial
intermediary’s website for more information.
Principal
Investment Strategies
The Fund
seeks to deliver superior, risk-adjusted returns, over full market cycles by
investing primarily in the common stocks of underappreciated companies and
industries. The Fund will generally focus on 25 to 35 companies
(i) with an investment grade debt rating, (ii) with a history of
paying common stock dividends, (iii) with a market capitalization among the
top 1,000 companies in the United States, and (iv) domiciled in the United
States. Under normal market conditions, the Fund will generally
invest 75% of its total assets in common stocks.
.In
evaluating investments through bottom up, fundamental analysis, particular
attention is paid to the following factors:
|
1.
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Normalized
operating margins;
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2.
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Expected
sustainable revenue and/or asset
growth;
|
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3.
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Investment
required to achieve expected
growth;
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4.
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Normalized
free cash flow after considering Items 1 through 3 above;
and
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5.
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Valuation
relative to normalized earnings and free cash flow after giving
consideration to growth potential and financial
strength.
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Investments
will be made with an intended investment horizon of three years, though
individual investments may be held for shorter or longer time
periods.
Up to 25%
of the Fund’s net assets may be invested in a combination of the following
investments:
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1.
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government
debt of any maturity; and
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2.
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investment
grade corporate debt of any
maturity.
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Of this
25%, no more than 10% will be invested in investment grade corporate debt and no
more than 5% will be invested in non-investment grade (i.e., “junk” bonds) corporate
debt.
The Fund
also may invest up to 15% of its net assets in foreign equity
securities.
Additionally,
up to 15% of the Fund’s net assets may be invested in a combination of
investments, including:
|
1.
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convertible
securities;
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|
2.
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options/warrants/rights;
and/or
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3.
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other
investment companies.
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The
decision to sell securities is driven by the Adviser’s evaluation of prospective
future total returns relative to the perceived risk of the security in
question. Securities may be sold when their estimated future return
is low in an absolute sense or if the security has an inferior risk/reward
profile relative to other investment alternatives.
Cash
or Temporary Investments
Under
normal circumstances, cash and cash equivalent securities will typically
comprise no more than 25% of the Fund’s net assets. However, the Fund
may invest up to 100% of its net assets in cash, cash equivalents, and
high-quality, short-term debt securities and money market instruments for
temporary defensive purposes in response to adverse market, economic or
political conditions. This may result in the Fund not achieving its
investment objective and the Fund’s performance may be negatively affected as a
result.
To the
extent that the Fund uses a money market fund or an exchange traded fund for its
cash position, there will be some duplication of expenses because the Fund would
bear its pro rata portion of such money market fund’s management fees and
operational expenses.
Principal
Risks
The
principal risks of investing in the Fund that may adversely affect the Fund’s
net asset value (“NAV”) or total return were previously summarized and are
discussed in more detail below. There can be no assurance that the
Fund will achieve its investment objective.
Management
Risk. The skill of the Adviser will play a significant role in
the Fund’s ability to achieve its investment objective. The Fund’s
ability to achieve its investment objective depends on the ability of the
Adviser to correctly identify economic trends, especially with regard to
accurately forecasting inflationary and deflationary periods. In
addition, the Fund’s ability to achieve its investment objective depends on the
Adviser’s ability to select stocks, particularly in volatile stock
markets. The Adviser could be incorrect in its analysis of
industries, companies and the relative attractiveness of growth and value stocks
and other matters. The Fund’s Adviser has not previously managed a
mutual fund.
Market Risk. The
Fund is designed for long-term investors who can accept the risks of investing
in a portfolio with significant common stock holdings. Common stocks tend to be
more volatile than other investment choices such as bonds and money market
instruments. The value of the Fund’s shares will fluctuate as a
result of the movement of the overall stock market or of the value of the
individual securities held by the Fund, and you could lose money.
Value-Style Investing
Risk. Value
stocks can perform differently from the market as a whole and from other types
of stocks. Value stocks may be purchased based upon the belief that a
given security may be out of favor. Value investing seeks to identify stocks
that have depressed valuations, based upon a number of factors which are thought
to be temporary in nature, and to sell them at superior profits when their
prices rise in response to resolution of the issues which caused the valuation
of the stock to be depressed. While certain value stocks may increase in value
more quickly during periods of anticipated economic upturn, they may also lose
value more quickly in periods of anticipated economic
downturn. Furthermore, there is the risk that the factors which
caused the depressed valuations are longer term or even permanent in nature, and
that there will not be any rise in valuation. Finally, there is the
increased risk in such situations that such companies may not have sufficient
resources to continue as ongoing businesses, which would result in the stock of
such companies potentially becoming worthless.
Debt Securities Risk. Debt
securities, such as notes and bonds, are subject to credit risk and interest
rate risk. Credit risk is the possibility that an issuer of an
instrument will be unable to make interest payments or repay principal when
due. Changes in the financial strength of an issuer or changes in the
credit rating of a security may affect its value. Interest rate risk
is the risk that interest rates may increase, which tends to reduce the resale
value of certain debt securities, including U.S. Government
obligations. Debt securities with longer maturities are generally
more sensitive to interest rate changes than those with shorter maturities.
Changes in market interest rates do not affect the rate payable on an existing
debt security, unless the instrument has adjustable or variable rate features,
which can reduce its exposure to interest rate risk. Changes in
market interest rates may also extend or shorten the duration of certain types
of instruments, such as asset-backed securities, thereby affecting their value
and the return on your investment.
New Fund
Risk. There can be no assurance that the Fund will grow to or
maintain an economically viable size, in which case the Board may determine to
liquidate the Fund. The Board can liquidate the Fund without
shareholder vote and, while shareholder interests will be the paramount
consideration, the timing of any liquidation may not be favorable to certain
individual shareholders.
Medium-Sized Companies
Risk. Investing in securities of medium-sized companies may
involve greater price fluctuation than investing in larger and more established
companies because the securities of many medium-sized companies are often traded
in the over-the-counter markets or have fewer shares outstanding, potentially
making them more thinly traded, less liquid and their prices more volatile than
the prices of the securities of larger companies. Medium-sized
companies may have narrower markets for their goods and/or services and may be
dependent on a smaller management team than larger, more established
companies. The smaller the company, the greater effect these risks
may have on that company’s operations and performance. As a result,
an investment in the Fund may exhibit a higher degree of volatility than the
general domestic securities market.
Foreign Securities
Risk. Foreign securities include American Depositary Receipts
(“ADRs”) and similar investments, including European Depositary Receipts
(“EDRs”) and Global Depositary Receipts (“GDRs”). ADRs, EDRs and GDRs
are depositary receipts for foreign company stocks issued by a bank and held in
trust at that bank, and which entitle the owner of such depositary receipts to
any capital gains or dividends from the foreign company stocks underlying the
depositary receipts. ADRs are U.S. dollar
denominated. EDRs and GDRs are typically U.S. dollar denominated but
may be denominated in a foreign currency. Foreign securities,
including ADRs, EDRs and GDRs, may be subject to more risks than U.S. domestic
investments. These additional risks may potentially include lower
liquidity, greater price volatility and risks related to adverse political,
regulatory, market or economic developments. Foreign companies also
may be subject to significantly higher levels of taxation than U.S. companies,
including potentially confiscatory levels of taxation, thereby reducing the
earnings potential of such foreign companies. In addition, amounts
realized on sales of foreign securities may be subject to high and potentially
confiscatory levels of foreign taxation and withholding when compared to
comparable transactions in U.S. securities. The Fund will generally
not be eligible to pass through to shareholders any U.S. federal income tax
credits or deductions with respect to foreign taxes paid unless it meets certain
requirements regarding the percentage of its total assets invested in foreign
securities. Investments in foreign securities involve exposure to
fluctuations in foreign currency exchange rates. Such fluctuations
may reduce the value of the investment. Foreign investments are also
subject to risks including potentially higher withholding and other taxes, trade
settlement, custodial, and other operational risks and less stringent investor
protection and disclosure standards in certain foreign markets. In
addition, foreign markets can and often do perform differently from U.S.
markets.
A
description of the Fund’s policies and procedures with respect to the disclosure
of the Fund’s portfolio securities is available in the Fund’s
SAI. Currently, disclosure of the Fund’s holdings is required to be
made quarterly within 60 days of the end of each fiscal quarter in the Annual
Report and Semi-Annual Report to Fund shareholders and in the quarterly holdings
report on Form N-Q. The Annual and Semi-Annual Reports are available
by contacting the Poplar Forest Partners Fund, c/o U.S. Bancorp Fund Services,
LLC, P.O. Box 701, Milwaukee, Wisconsin 53201-0701, or calling
1-[8__]-[___]-[____]
and on the SEC’s website at www.sec.gov. A complete description of
the Fund’s policies and procedures with respect to the disclosure of the Fund’s
portfolio holdings is available in the SAI.
Investment
Adviser
Poplar
Forest Capital, LLC is the Fund’s investment adviser and is located at 70 South
Lake Avenue, Suite 930, Pasadena, California 91101. The
Adviser is an SEC-registered investment advisory firm formed in
2007. The Adviser provides investment management services to
institutions, individuals, high net worth individuals and other pooled
investment vehicles.
The
Adviser is responsible for the day-to-day management of the Fund in accordance
with the Fund’s investment objective and policies. The Adviser also
furnishes the Fund with office space and certain administrative services and
provides most of the personnel needed to fulfill its obligations under its
advisory agreement. For its services, the Fund pays the Adviser a
monthly management fee that is calculated at the annual rate of 1.00% of the
Fund’s average daily net assets for the first $250 million of assets, 0.80% of
the Fund’s average daily net assets for the next $750 million of assets, and
0.60% of the Fund’s average daily net assets for assets in excess of
$1 billion.
A
discussion regarding the basis of the Board’s approval of the Investment
Advisory Agreement will be available in the Fund’s Semi-Annual Report to
shareholders for the fiscal period ending March 31, 2010.
Portfolio
Manager
J. Dale
Harvey, CEO and Chief Investment Officer of Poplar Forest Capital, LLC, is the
portfolio manager responsible for the day-to-day management of the
Fund. Prior to founding the Adviser in 2007, from 1991 to 2007, Mr.
Harvey served as a portfolio counselor and investment analyst at Capital Group
Companies. In his role with Capital Group Companies, Mr. Harvey
served as President and Director (2005 to 2007) and portfolio counselor (2000 to
2007) for the American Mutual Fund; as President (2003 to 2005) and portfolio
counsel (1997 to 2005) for the American Balanced Fund; as portfolio counselor
(1997 to 2007) for the Washington Mutual Investors Fund; as portfolio counsel
(2005 to 2007) for the Investment Company of America Fund; and as portfolio
counselor (2003 to 2007) for the SmallCap World Fund.
The SAI
provides additional information about the portfolio manager’s compensation,
other accounts managed by the portfolio manager and his ownership of securities
in the Fund.
Prior
Performance
The
following table sets forth performance data relating to the historical
performance of a fund managed by the same Adviser personnel responsible for the
day-to-day management of the Fund for the periods indicated, and that has
investment objectives, policies, strategies and risks substantially similar to
those of the Fund. The fund shown below is the only fund managed by
the Adviser in a substantially similar manner to the portfolio of the
Fund. The data is provided to illustrate the past performance of the
Adviser and the portfolio manager in managing substantially similar accounts as
measured against the S&P 500Ò
Index, and does not represent the performance of the Fund. The fund
shown is not subject to the same types of expenses to which the Fund is subject,
nor to the diversification requirements, specific tax restrictions and
investment limitations imposed on the Fund by the Investment Company Act of
1940, as amended, or Subchapter M of the Internal Revenue Code of 1986, as
amended (the “Code”). Consequently, the performance results for the
fund expressed below could have been adversely affected if it had been regulated
as an investment company under the federal securities laws.
The
Poplar Forest Fund, LP launched on October 7, 2007, and has been managed since
inception by the Adviser. Poplar Forest Fund, LP has over $70 million
in assets and accounts for approximately 57% of the assets managed by the
Adviser. The Poplar Forest Fund, LP performance is provided to
illustrate the past performance of the Poplar Forest Fund, LP and does not
represent the historical performance of the Fund. You should not consider this
performance data to be an indication of future performance of the
Fund.
|
As
of Last Completed Calendar Year End
(12/31/2008)
(Annualized)
|
|||
|
Year-to
Date Through 9/30/2009
|
One
Year
|
Since
Inception (10/7/2007)
|
|
|
Poplar
Forest Fund, LP
|
29.3%
|
2.1%
|
-21.4%
|
|
S&P
500Ò
Index
|
19.3%
|
-6.9%
|
-28.8%
|
The
management fee and operating expenses charged in Poplar Forest Fund, LP is 1.15%
and the performance results shown are net of this fee. The fees of
the Poplar Forest Fund, LP differ from the fees of the Fund.
The
Adviser believes judging results over full market cycles is an especially
appropriate approach to reviewing performance. Results presented in a
format consistent with market cycles are presented below:
|
Downcycle
(10/7/2007-3/31/09)
|
Upcycle
(4/1/09-9/30/09)
|
|
|
Poplar
Forest Fund, LP
|
-44.4%
|
41.4%
|
|
S&P
500Ò
Index
|
-46.9%
|
34.0%
|
Fund
Expenses
The Fund
is responsible for its own operating expenses. However, the Adviser
has contractually agreed to waive all or a portion of its management fees and/or
pay Fund expenses (excluding acquired fund fees and expenses, interest, taxes
and extraordinary expenses) in order to limit Net Annual Fund Operating Expenses
for shares of the Fund to 1.25% and
1.00% of average daily net assets for the Fund’s Class A shares and
Institutional Class shares, respectively (the “Expense Caps”). The
term of the Fund’s operating expense limitation agreement is indefinite and it
can only be terminated by a vote of the Board. Any waiver of
management fees or payment of expenses made by the Adviser may be recouped by
the Adviser in subsequent fiscal years if the Adviser so
requests. The Adviser is permitted to recoup fee waivers and/or
expense payments made in the prior three fiscal years from the date the fees
were waived and/or Fund expenses were paid. Any such recoupment is
contingent upon the subsequent review and ratification of the recouped amounts
by the Board. The Fund must pay current ordinary operating expenses
before the Adviser is entitled to any recoupment of fees and/or
expenses. This recoupment may be requested by the Adviser if the
aggregate amount actually paid by the Fund toward operating expenses for such
fiscal year (taking into account the recoupment) does not exceed the Expense
Caps.
Distributor
Quasar
Distributors, LLC (the “Distributor” or “Quasar”), an affiliate of the Fund’s
transfer agent, U.S. Bancorp Fund Services, LLC (“Transfer Agent”), is located
at 615 East Michigan Street, 4th floor, Milwaukee, Wisconsin 53202, and is the
distributor for the shares of the Fund. Quasar is a registered
broker-dealer and a member of the Financial Industry Regulatory Authority
(“FINRA”). Shares of the Fund are offered on a continuous
basis.
Distribution
Plan
The Trust
has adopted a plan pursuant to Rule 12b-1 for the Fund’s Class A shares that
allows the Fund to pay fees for the sale, distribution and servicing of its
Class A shares. The plan provides for a distribution and servicing
fee of up to 0.25% of the Class A shares’ average daily net
assets. Because these fees are paid out over the life of the Fund’s
Class A shares, over time, these fees (to the extent they are accrued and paid)
will increase the cost of your investment and may cost you more than paying
other types of sales charges.
Service
Fees – Other Payments to Third Parties
In
addition to Rule 12b-1 fees, the Fund may pay service fees to intermediaries
such as banks, broker-dealers, financial advisers or other financial
institutions, including affiliates of the Adviser, for sub-administration,
sub-transfer agency and other shareholder services associated with shareholders
whose shares are held of record in omnibus, other group accounts or accounts
traded through registered securities clearing agents.
The
Adviser, out of its own resources, and without additional cost to the Fund or
its shareholders, may provide additional cash payments or non-cash compensation
to intermediaries who sell shares of the Fund. Such payments and
compensation are in addition to Rule 12b-1 and service fees paid by the
Fund. These additional cash payments are generally made to
intermediaries that provide shareholder servicing, marketing support and/or
access to sales meetings, sales representatives and management representatives
of the intermediary. Cash compensation may also be paid to
intermediaries for inclusion of the Fund on a sales list, including a preferred
or select sales list, in other sales programs or as an expense reimbursement in
cases where the intermediary provides shareholder services to the Fund’s
shareholders. The Adviser may also pay cash compensation in the form
of finder’s fees that vary depending on the Fund and the dollar amount of the
shares sold.
You may
purchase shares of the Fund by check, by wire transfer, via electronic funds
transfer through the Automated Clearing House (“ACH”) network or through a bank
or through one or more brokers authorized by the Fund to receive purchase
orders. Please use the appropriate account application when
purchasing by mail or wire. If you have any questions or need further
information about how to purchase shares of the Fund, you may call a customer
service representative of the Fund toll-free at 1-[8__]-[___]-[____]. The
Fund reserves the right to reject any purchase order. For example, a
purchase order may be refused if, in the Adviser’s opinion, it is so large that
it would disrupt the management of the Fund. Orders may also be
rejected from persons believed by the Fund to be “market timers.”
All
checks must be in U.S. dollars drawn on a domestic U.S. bank. The
Fund will not accept payment in cash or money orders. The Fund also
does not accept cashier’s checks in amounts of less than
$10,000. Also, to prevent check fraud, the Fund will not accept third
party checks, U.S. Treasury checks, credit card checks, traveler’s checks or
starter checks for the purchase of shares. The Fund is unable to
accept post-dated checks, post-dated on-line bill pay checks, or any conditional
order or payment.
To buy
shares of the Fund, complete an account application and send it together with
your check for the amount you wish to invest in the Fund to the address
below. To make additional investments once you have opened your
account, write your account number on the check and send it together with the
most recent confirmation statement received from the Transfer
Agent. If your payment is returned for any reason, your purchase will
be canceled and a $25 fee will be assessed against your account by the Transfer
Agent. You may also be responsible for any loss sustained by the
Fund.
In
addition to cash purchases, Fund shares may be purchased by tendering payment
in-kind in the form of shares of stock, bonds or other
securities. Any securities used to buy Fund shares must be readily
marketable, their acquisition consistent with the Fund’s objective and otherwise
acceptable to the Adviser and the Board. For further information, you may call a
customer service representative of the Fund toll-free at 1-[8__]-[___]-[____].
In
compliance with the USA PATRIOT Act of 2001, please note that the Transfer Agent
will verify certain information on your account application as part of the
Trust’s Anti-Money Laundering Program. As requested on the account application,
you should supply your full name, date of birth, social security number and
permanent street address. Mailing addresses containing only a P. O. Box will not
be accepted. Please contact the Transfer Agent at 1-[8__]-[___]-[____]
if you need additional assistance when completing your account
application.
Shares of
the Fund have not been registered for sale outside of the United
States. The Adviser generally does not sell shares to investors
residing outside of the United States, even if they are United States citizens
or lawful permanent residents, except to investors with United States military
APO or FPO addresses.
Purchasing
Shares by Mail
Please
complete the account application and mail it with your check, payable to the
Poplar
Forest Partners Fund, to the Transfer Agent at the following
address:
Poplar
Forest Partners Fund
c/o U.S.
Bancorp Fund Services, LLC
P.O. Box
701
Milwaukee,
Wisconsin 53201-0701
You may
not send an account application via overnight delivery to a United States Postal
Service post office box. If you wish to use an overnight delivery service, send
your account application and check to the Transfer Agent at the following
address:
Poplar
Forest Partners Fund
c/o U.S.
Bancorp Fund Services, LLC
615 East
Michigan Street, 3rd
Floor
Milwaukee,
Wisconsin 53202
|
|
Note:
|
The
Fund does not consider the U.S. Postal Service or other independent
delivery services to be their agents. Therefore, a deposit in the mail or
with such services, or receipt at U.S. Bancorp Fund Services, LLC’s post
office box, of account applications or redemption requests does not
constitute receipt by the Transfer
Agent.
|
If the
Transfer Agent does not have a reasonable belief of the identity of an investor,
the account application will be rejected or the investor will not be allowed to
perform a transaction on the account until such information is
received. The Fund may also reserve the right to close the account
within five business days if clarifying information/documentation is not
received.
Purchasing
Shares by Telephone
If you
have been authorized to perform telephone transactions (either by completing the
required portion of your account application or by subsequent arrangement in
writing with the Fund), you may purchase additional Class A shares by calling
the Fund toll-free at 1-[8__]-[___]-[____]. You
may not make your initial purchase of the Fund shares by
telephone. Telephone orders will be accepted via electronic funds
transfer from your pre-designated bank account through the ACH
network. You must have banking information established on your
account prior to making a telephone purchase. Only bank accounts held
at domestic institutions that are ACH members may be used for telephone
transactions. If your order is received prior to 4:00 p.m., Eastern
time, shares will be purchased at the appropriate share price next
calculated. For security reasons, requests by telephone may be
recorded. Once a telephone transaction has been placed, it cannot be
cancelled or modified.
Purchasing
Shares by Wire
If you
are making your initial investment in the Fund, before wiring funds, the
Transfer Agent must have a completed account application. You can
mail or overnight deliver your account application to the Transfer Agent at the
above address. Upon receipt of your completed account application,
the Transfer Agent will establish an account on your behalf. Once
your account is established, you may instruct your bank to send the
wire. Your bank must include the name of the Fund, your name and your
account number so that monies can be correctly applied. Your bank
should transmit immediately available funds by wire to:
U.S. Bank
National Association
777 East
Wisconsin Avenue
Milwaukee,
Wisconsin 53202
ABA
#075000022
Credit:
U.S. Bancorp Fund Services, LLC
A/C#112-952-137
FFC:
[Name of Fund]
Shareholder
Registration
Shareholder
Account Number
If you
are making a subsequent purchase, your bank should wire funds as indicated
above. Before each wire purchase, you should be sure to notify the
Transfer Agent. It
is essential that your bank include complete information about your account in
all wire transactions. If you have questions about how to
invest by wire, you may call the Transfer Agent at 1-[8__]-[___]-[____]. Your
bank may charge you a fee for sending a wire payment to the Fund.
Wired
funds must be received prior to 4:00 p.m. Eastern time to be eligible for same
day pricing. Neither the Fund nor U.S. Bank N.A. are responsible for
the consequences of delays resulting from the banking or Federal Reserve wire
system or from incomplete wiring instructions.
Automatic
Investment Plan
Once your
account has been opened with the initial minimum investment, you may make
additional purchases of Class A shares at regular intervals through the
Automatic Investment Plan (“AIP”). The AIP provides a convenient
method to have monies deducted from your bank account, for investment into the
Fund, on a monthly or quarterly basis. In order to participate in the
AIP, each purchase must be in the amount of $100 or more, and your financial
institution must be a member of the ACH network. If your bank rejects
your payment, the Transfer Agent will charge a $25 fee to your
account. To begin participating in the AIP, please complete the
Automatic Investment Plan section on the account application or call the
Transfer Agent at
1-[8__]-[___]-[____]. Any
request to change or terminate your AIP should be submitted to the Transfer
Agent at least five business days prior to the automatic investment
date.
Retirement
Accounts
The Fund
offers prototype documents for a variety of retirement accounts for individuals
and small businesses. Please call 1-[8__]-[___]-[____]
for information on:
• Individual
Retirement Plans, including Traditional IRAs and Roth IRAs.
• Small
Business Retirement Plans, including Simple IRAs and SEP IRAs.
There may
be special distribution requirements for a retirement account, such as required
distributions or mandatory Federal income tax withholdings. For more
information, call the number listed above. You may be charged a $15 annual
account maintenance fee for each retirement account up to a maximum of $30
annually and a $25 fee for transferring assets to another custodian or for
closing a retirement account. Fees charged by institutions may
vary.
Purchasing
and Selling Shares through a Broker
You may
buy and sell shares of the Fund through certain brokers and financial
intermediaries (and their agents) (collectively, “Brokers”) that have made
arrangements with the Fund to sell its shares. When you place your
order with such a Broker, your order is treated as if you had placed it directly
with the Transfer Agent, and you will pay or receive the next price calculated
by the Fund. The Broker holds your shares in an omnibus account in
the Broker’s name, and the Broker maintains your individual ownership
records. The Adviser may pay the Broker for maintaining these records
as well as providing other shareholder services. The Broker may
charge you a fee for handling your order. The Broker is responsible
for processing your order correctly and promptly, keeping you advised regarding
the status of your individual account, confirming your transactions and ensuring
that you receive copies of the Fund’s Prospectus.
You may
sell (redeem) your Fund shares on any day the Fund and the NYSE are open for
business either directly to the Fund or through your financial
intermediary.
In
Writing
You may
redeem your shares by simply sending a written request to the Transfer
Agent. You should provide your account number and state whether you
want all or some of your shares redeemed. The letter should be signed
by all of the shareholders whose names appear on the account registration and
include a signature guarantee(s), if necessary. You should send your
redemption request to:
|
Regular Mail
|
Overnight Express Mail
|
|
Poplar
Forest Partners Fund
|
Poplar
Forest Partners Fund
|
|
c/o
U.S. Bancorp Fund Services, LLC
|
c/o
U.S. Bancorp Fund Services, LLC
|
|
P.O.
Box 701
|
615
East Michigan Street, 3rd
Floor
|
|
Milwaukee,
Wisconsin 53201-0701
|
Milwaukee,
Wisconsin 53202
|
|
NOTE:
|
The
Fund does not consider the U.S. Postal Service or other independent
delivery services to be its agents. Therefore, a deposit in the
mail or with such services, or receipt at U.S. Bancorp Fund Services,
LLC’s post office box, of account applications or redemption requests does
not constitute receipt by the Transfer
Agent.
|
By
Telephone
If you
complete the Telephone Options portion of the account application, you may
redeem all or some of your shares, up to $50,000, by calling the Transfer Agent
at 1-[8__]-[___]-[____]
before the close of trading on the NYSE. This is normally
4:00 p.m., Eastern time. Redemption proceeds will be processed
on the next business day and sent to the address that appears on the Transfer
Agent’s records or via ACH to a previously established bank
account. If you request, redemption proceeds will be wired on the
next business day to the bank account you designated on the account
application. The minimum amount that may be wired is $1,000. Wire
charges, if any, will be deducted from your redemption
proceeds. Telephone redemptions cannot be made if you notified the
Transfer Agent of a change of address within 15 days before the redemption
request. If you have a retirement account, you may not redeem your
shares by telephone.
You may
request telephone redemption privileges after your account is opened by calling
the Transfer Agent at 1-[8__]-[___]-[____]
for instructions.
You may
encounter higher than usual call wait times during periods of high market
activity. Please allow sufficient time to ensure that you will be
able to complete your telephone transaction prior to market close. If
you are unable to contact the Fund by telephone, you may mail your redemption
request in writing to the address noted above. Once a telephone
transaction has been accepted, it may not be canceled or modified.
Payment
of Redemption Proceeds
Payment
of your redemption proceeds will be made promptly, but not later than seven days
after the receipt of your written request in good order. If you did
not purchase your shares with a certified check or wire payment, the Fund may
delay payment of your redemption proceeds for up to 15 days from purchase
or until your check has cleared, whichever occurs first.
The Fund
may redeem the shares in your account if the value of your account is less than
$5,000 as a result of redemptions you have made. This does not apply
to retirement plan accounts. You will be notified that the value of
your account is less than $5,000 before the Fund makes an involuntary
redemption. You will then have 30 days in which to make an
additional investment to bring the value of your account to at least $5,000
before the Fund takes any action.
Systematic
Withdrawal Plan
As
another convenience, you may redeem your Class A shares through the Systematic
Withdrawal Plan (“SWP”). Under the SWP, shareholders or their
financial intermediaries may request that a payment drawn in a predetermined
amount be sent to them on a monthly, quarterly or annual basis. In
order to participate in the SWP, your account balance must be at least $50,000
and each withdrawal amount must be for a minimum of $2,500. If you
elect this method of redemption, the Fund will send a check directly to your
address of record or will send the payment directly to your bank account via
electronic funds transfer through the ACH network. For payment
through the ACH network, your bank must be an ACH member and your bank account
information must be previously established on your account. The SWP
may be terminated at any time by the Fund. You may also elect to
terminate your participation in the SWP at any time by writing to the Transfer
Agent at:
|
Regular Mail
|
Overnight Express Mail
|
|
Poplar
Forest Partners Fund
|
Poplar
Forest Partners Fund
|
|
c/o
U.S. Bancorp Fund Services, LLC
|
c/o
U.S. Bancorp Fund Services, LLC
|
|
P.O.
Box 701
|
615
East Michigan Street, 3rd
Floor
|
|
Milwaukee,
Wisconsin 53201-0701
|
Milwaukee,
Wisconsin 53202
|
A
withdrawal under the SWP involves a redemption of shares and may result in a
gain or loss for federal income tax purposes. In addition, if the
amount withdrawn exceeds the dividends credited to your account, the account
ultimately may be depleted. To establish a SWP, an investor must
complete the appropriate sections of the account application. For
additional information on the SWP, please call the Transfer Agent at 1-[8__]-[___]-[____].
Redemption
“In-Kind”
The Fund
reserves the right to pay redemption proceeds to you in whole or in part by a
distribution of securities from the Fund’s portfolio (a “redemption
in-kind”). It is not expected that the Fund would do so except during
unusual market conditions. If the Fund pays your redemption proceeds
by a distribution of securities, you could incur brokerage or other charges in
converting the securities to cash and will bear any market risks associated with
such securities until they are converted into cash.
Signature
Guarantees
Signature
guarantees will generally be accepted from domestic banks, brokers, dealers,
credit unions, national securities exchanges, registered securities
associations, clearing agencies and savings associations, as well as from
participants in the New York Stock Exchange Medallion Signature Program and the
Securities Transfer Agents Medallion Program. A notary public is not an acceptable
signature guarantor.
A
signature guarantee is required to redeem shares in the following
situations:
|
·
|
If
ownership is changed on your
account;
|
|
·
|
When
redemption proceeds are payable or sent to any person, address or bank
account not on record;
|
|
·
|
Written
requests to wire redemption proceeds (if not previously authorized on the
account);
|
|
·
|
When
establishing or modifying certain services on an
account;
|
|
·
|
If
a change of address was received by the Transfer Agent within the last 15
days; and
|
|
·
|
For
all redemptions in excess of $50,000 from any shareholder
account.
|
In
addition to the situations described above, the Fund and/or the Transfer Agent
reserve the right to require a signature guarantee in other instances based on
the circumstances.
Other
Information about Redemptions
Payment
of your redemption proceeds will be made promptly, but not later than seven days
after the receipt of your written request in proper form as discussed in this
Prospectus. If you did not purchase your shares by wire payment, the
Fund may delay payment of your redemption proceeds for up to 15 calendar
days from the date of purchase or until your check has cleared, whichever occurs
first.
The Fund
may redeem the shares in your account if the value of your account is less than
$5,000 as a result of redemptions you have made. This does not apply
to retirement plan or Uniform Gifts or Transfers to Minors Act
accounts. You will be notified that the value of your account is less
than $5,000 before the Fund makes an involuntary redemption. You will
then have 30 days in which to make an additional investment to bring the
value of your account to at least $5,000 before the Fund takes any
action.
The Board
has adopted policies and procedures to prevent frequent transactions in the
Fund. The Fund discourages excessive, short-term trading and other
abusive trading practices that may disrupt portfolio management strategies and
harm the Fund’s performance. The Fund takes steps to reduce the frequency and
effect of these activities in the Fund. These steps include
monitoring trading activity and using fair value pricing. Although
these efforts (which are described in more detail below) are designed to
discourage abusive trading practices, these tools cannot eliminate the
possibility that such activity may occur. Further, while the Fund
makes efforts to identify and restrict frequent trading, the Fund receives
purchase and sale orders through financial intermediaries and cannot always know
or detect frequent trading that may be facilitated by the use of intermediaries
or the use of group or omnibus accounts by those intermediaries. The
Fund seeks to exercise its judgment in implementing these tools to the best of
its abilities in a manner that the Fund believes is consistent with shareholder
interests.
Monitoring Trading
Practices. The Fund monitors selected trades in an effort to
detect excessive short-term trading activities. If, as a result of
this monitoring, the Fund believes that a shareholder has engaged in excessive
short-term trading, it may, in its discretion, ask the shareholder to stop such
activities or refuse to process purchases in the shareholder’s
accounts. In making such judgments, the Fund seeks to act in a manner
that it believes is consistent with the best interests of
shareholders. Due to the complexity and subjectivity involved in
identifying abusive trading activity and the volume of shareholder transactions
the Fund handles, there can be no assurance that the Fund’s efforts will
identify all trades or trading practices that may be considered
abusive. In addition, the Fund’s ability to monitor trades that are
placed by individual shareholders within group or omnibus accounts maintained by
financial intermediaries is limited because the Fund does not have simultaneous
access to the underlying shareholder account information.
In
compliance with Rule 22c-2 of the Investment Company Act of 1940, as amended,
the Fund’s Distributor, on behalf of the Fund, has entered into written
agreements with each of the Fund’s financial intermediaries, under which the
intermediary must, upon request, provide the Fund with certain shareholder and
identity trading information so that the Fund can enforce its market timing
policies.
Fair Value
Pricing. The Fund employs fair value pricing selectively to
ensure greater accuracy in its daily NAV and to prevent dilution by frequent
traders or market timers who seek to take advantage of temporary market
anomalies. The Board has developed procedures which utilize fair
value pricing when reliable market quotations are not readily available or the
Fund’s pricing service does not provide a valuation (or provides a valuation
that in the judgment of the Adviser to the Fund does not represent the
security’s fair value), or when, in the judgment of the Adviser, events have
rendered the market value unreliable. Valuing securities at fair
value involves reliance on judgment. Fair value determinations are
made in good faith in accordance with procedures adopted by the Board and are
reviewed annually by the Board. There can be no assurance that the
Fund will obtain the fair value assigned to a security if it were to sell the
security at approximately the time at which the Fund determines its NAV per
share.
Fair
value pricing may be applied to non-U.S. securities. The trading
hours for most non-U.S. securities end prior to the close of the NYSE, the time
that a Fund’s NAV is calculated. The occurrence of certain events
after the close of non-U.S. markets, but prior to the close of the NYSE (such as
a significant surge or decline in the U.S. market) often will result in an
adjustment to the trading prices of non-U.S. securities when non-U.S. markets
open on the following business day. If such events occur, the Fund
may value non-U.S. securities at fair value, taking into account such events,
when it calculates its NAV. Other types of securities that a Fund may
hold for which fair value pricing might be required include, but are not limited
to: (a) investments which are frequently traded and/or the market price of
which the Adviser believes may be stale; (b) illiquid securities, including
“restricted” securities and private placements for which there is no public
market; (c) securities of an issuer that has entered into a restructuring;
(d) securities whose trading has been halted or suspended; and
(e) fixed income securities that have gone into default and for which there
is not a current market value quotation.
More
detailed information regarding fair value pricing can be found under the heading
titled, “Pricing of Fund Shares.”
Householding
In an
effort to decrease costs, the Transfer Agent intends to reduce the number of
duplicate prospectuses, Annual and Semi-Annual Reports, proxy statements and
other regulatory documents you receive by sending only one copy of each to those
addresses shared by two or more accounts and to shareholders the Transfer Agent
reasonably believes are from the same family or household. Once
implemented, if you would like to discontinue householding for your accounts,
please call toll-free at 1-[8__]-[___]-[____]
to request individual copies of these documents. Once the
Transfer Agent receives notice to stop householding, the Transfer Agent will
begin sending individual copies thirty days after receiving your
request. This policy does not apply to account
statements.
Pricing
of Fund Shares
Shares of
the Fund are sold at NAV per share, plus any applicable sales charge, which is
calculated as of the close of regular trading (generally, 4:00 p.m.,
Eastern time) on each day that the New York Stock Exchange (“NYSE”) is open for
unrestricted business. However, the Fund’s NAV may be calculated
earlier if trading on the NYSE is restricted or as permitted by the
SEC. The NYSE is closed on weekends and most national holidays,
including New Year’s Day, Martin Luther King, Jr. Day, Washington’s
Birthday/Presidents’ Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day and Christmas Day. The NAV will not be
calculated on days when the NYSE is closed for trading.
Purchase
and redemption requests are priced based on the next NAV per share calculated
after receipt of such requests. The NAV is the value of the Fund’s
securities, cash and other assets, minus all expenses and liabilities (assets –
liabilities = NAV). NAV per share is determined by dividing NAV by
the number of shares outstanding (NAV/ # of shares = NAV per
share). The NAV takes into account the expenses and fees of the Fund,
including management and administration fees, which are accrued
daily.
In
calculating the NAV, portfolio securities are valued using current market values
or official closing prices, if available. Each security owned by the
Fund that is listed on a securities exchange is valued at its last sale price on
that exchange on the date as of which assets are valued. Where the
security is listed on more than one exchange, the Fund will use the price of the
exchange that the Fund generally considers to be the principal exchange on which
the security is traded.
When
market quotations are not readily available, a security or other asset is valued
at its fair value as determined under procedures approved by the
Board. These fair value procedures will also be used to price a
security when corporate events, events in the securities market and/or world
events cause the Adviser to believe that a security’s last sale price may not
reflect its actual market value. The intended effect of using fair
value pricing procedures is to ensure that the Fund is accurately
priced. The Board will regularly evaluate whether the Fund’s fair
valuation pricing procedures continue to be appropriate in light of the specific
circumstances of the Fund and the quality of prices obtained through their
application by the Trust’s valuation committee.
Trading
in Foreign Securities
In the
case of foreign securities, the occurrence of certain events after the close of
foreign markets, but prior to the time the Fund’s NAV per share is calculated
(such as a significant surge or decline in the U.S. or other markets) often will
result in an adjustment to the trading prices of foreign securities when foreign
markets open on the following business day. If such events occur, the
Fund will value foreign securities at fair value, taking into account such
events, in calculating the NAV per share. In such cases, use of fair
valuation can reduce an investor’s ability to seek to profit by estimating the
Fund’s NAV per share in advance of the time the NAV per share is
calculated. The Adviser anticipates that the Fund’s portfolio
holdings will be fair valued when market quotations for those holdings are
considered unreliable.
Description
of Classes
The Trust
has adopted a multiple class plan that allows the Fund to offer one or more
classes of shares. The Fund has registered two classes of shares –
Class A shares and Institutional Class shares. This Prospectus offers
Class A shares and Institutional Class shares of the Fund. The
different classes of shares represent investments in the same portfolio of
securities, but the classes are subject to different expenses as outlined below
and may have different share prices:
|
•
|
Class
A shares are charged a front-end sales load. The Class A shares
are also charged a 0.25% Rule 12b-1 distribution and servicing
fee. Class A shares do not have a contingent deferred sales
charge (“CDSC”) except that a redemption within twelve months of purchase
of investments of $1 million or more on which no front-end sales charge is
paid are subject to a 0.75% CDSC.
|
|
•
|
Institutional
Class shares do
not impose a sales charge or a Rule 12b-1 fee. If you purchase
Institutional Class shares, you will pay the NAV per share next determined
after your order is received.
|
More
About Class A Shares
Class A
shares of the Fund are retail shares that require that you pay a sales charge
when you invest in the Fund unless you qualify for a reduction or waiver of the
sales charge. Class A shares are also subject to Rule 12b-1 fees (or
distribution and service fees) described earlier of 0.25% of average daily net
assets, which are assessed against the shares of the Fund.
If you
purchase Class A shares of the Fund you will pay the public offering price
(“POP”) which is the NAV next determined after your order is received plus a
sales charge (shown in percentages below) depending on the amount of your
investment. Since sales charges are reduced for Class A share
purchases above certain dollar amounts, known as “breakpoint thresholds,” the
POP is lower for these purchases. The dollar amount of the sales
charge is the difference between the POP of the shares purchased (based on the
applicable sales charge in the table below) and the NAV of those
shares. Because of rounding in the calculation of the POP, the actual
sales charge you pay may be more or less than that calculated using the
percentages shown below. The sales charge is calculated as
follows:
|
Investment
Amount
|
Sales Charge
as
a
% of
Offering Price(1)
|
Sales
Charge as % of Net Amount Invested
|
Dealer
Reallowance
|
|
$25,000
to $49,999
|
5.00%
|
5.26%
|
4.50%
|
|
$50,000
to $99,999
|
4.50%
|
4.71%
|
4.00%
|
|
$100,000
to $249,999
|
3.50%
|
3.63%
|
3.00%
|
|
$250,000
to $499,999
|
2.50%
|
2.56%
|
2.00%
|
|
$500,000
to $749,999
|
2.00%
|
2.04%
|
1.50%
|
|
$750,000
to $999,999
|
1.50%
|
1.52%
|
1.00%
|
|
$1,000,000
or more
(2)
|
0.00%
|
0.00%
|
0.75%
|
|
(1)
|
Offering
price includes the front-end sales load. The sales charge you
pay may differ slightly from the amount set forth above because of
rounding that occurs in the calculation used to determine your sales
charge.
|
|
(2)
|
Class
A shares that are purchased at NAV in amounts of $1,000,000 or more may be
assessed a 0.75% contingent deferred sales charge (CDSC), if they are
redeemed within twelve months from the date of
purchase.
|
Class
A Sales Charge Reductions and Waivers
You may
be able to reduce the sales charge on Class A shares of the Fund based on the
type of transaction, the combined market value of your accounts or intended
investment, and for certain groups or classes of shareholders. If you
believe you are eligible for any of the following reductions or waivers, it is
up to you to ask the selling agent or shareholder servicing agent for the
reduction and to provide appropriate proof of eligibility. The
programs described below and others are explained in greater detail in the
SAI.
Reinvested
Distributions: You pay no sales charges on Class A shares you
buy with reinvested distributions from Class A distributions from the
Fund.
Account
Reinstatement: You pay no sales charges on Class A shares you
purchase with the proceeds of a redemption of Class A shares of the Fund within
120 days of the date of the redemption.
Letter of Intent
(“LOI”): By signing an LOI prior to purchase, you pay a lower
sales charge now in exchange for promising to invest an amount within the next
13 months sufficient to meet one of the above breakpoint
thresholds. The investment must satisfy the initial purchase
agreement. Reinvested distributions do not count as purchases made
during this period. The Fund will hold in escrow shares equal to
approximately 5% of the amount of shares you indicate in the LOI. If
you do not invest the amount specified in the LOI before the expiration date,
the Transfer Agent will redeem a sufficient amount of escrowed shares to pay the
difference between the reduced sales load you paid and the sales load you would
have paid based on the total amount actually invested in Class A shares as of
the expiration date. Otherwise, the Transfer Agent will release the
escrowed shares when you have invested the agreed amount.
Rights of Accumulation
(“ROA”): You may combine the value at the current public
offering price of Class A shares of the Fund with a new purchase of Class A
shares of the Fund to reduce the sales charge on the new
purchase. The sales charge for the new shares will be figured at the
rate in the table above that applies to the combined value of your currently
owned shares and the amount of the new investment. ROA allows you to
combine the value of your account with the value of other eligible accounts for
purposes of meeting the breakpoint thresholds above.
You may
aggregate your eligible accounts with the eligible accounts of members of your
immediate family to obtain a breakpoint discount. The types of
eligible accounts that may be aggregated to obtain the breakpoint discounts
described above include individual accounts, joint accounts and certain
Individual Retirement Accounts (“IRAs”).
For the
purpose of obtaining a breakpoint discount, members of your “immediate family”
include your spouse, child, stepchild, parent, sibling, grandchild and
grandparent, in each case including in-law and adoptive
relationships. In addition, a fiduciary can count all shares
purchased for a trust, estate or other fiduciary account (including one or more
employee benefit plans of the same employer) that has multiple
accounts. Eligible accounts include those registered in the name of
your financial intermediary through which you own shares in the
Fund.
Certain groups or classes of
shareholders: If you fall into any of the following categories, you can
buy Class A shares at NAV without a sales charge:
|
•
|
Current
and retired employees, directors/trustees and officers
of:
|
|
|
i.
|
The
Trust; and
|
|
|
ii.
|
The
Adviser and its affiliates;
|
|
•
|
Family
members (spouse, domestic partner, parents, grandparents, children,
grandchildren and siblings (including step and in-law)) of (i)-(ii):
and
|
|
•
|
Any
trust, pension, profit sharing or other benefit plan for current
employees, directors/trustees and officers of the Adviser and its
affiliates;
|
|
•
|
Current
employees of:
|
|
|
i.
|
The
Transfer Agent;
|
|
|
ii.
|
broker-dealers
who act as selling agents for the
Fund/Trust;
|
|
•
|
family
members (spouse, domestic partner, parents, grandparents, children,
grandchildren and siblings (including step and in-law)) of (i)-(ii);
and
|
|
•
|
Qualified
registered investment advisers who buy through a broker-dealer or service
agent who has entered into an agreement with the Distributor that allows
for load-waived Class A shares
purchases.
|
For
calendar year 2010, the Fund will waive the Class A sales charges for the
reinvestment of $100,000 or more of proceeds from the sale of shares of another
equity mutual fund where those shares were subject to a front-end sales charge
(sometimes referred to as an NAV transfer). In order to be eligible
for this waiver, proceeds from the sale of shares of another fund must be
reinvested in the Fund within 30 days and documentation satisfactory to the
Fund, must be provided evidencing your eligibility for this
waiver. The Fund also reserves the right to enter into agreements
that reduce or eliminate sales charges for other groups or classes of
shareholders, including for Fund shares included in other investment plans such
as “wrap accounts.” If you own Fund shares as part of another account
or package, such as an IRA or a sweep account, you should read the terms and
conditions that apply for that account. Those terms and conditions
may supersede the terms and conditions discussed here. Contact your
selling agent for further information.
Statement of Additional
Information
More
information regarding the Fund’s sales charges, breakpoint thresholds and
waivers is available in the SAI and free of charge on the Fund’s website:
www.poplarforestllc.com. Click on
“Breakpoints and Sales Loads.”
More
about Institutional Class Shares
Institutional
Class shares do not carry a sales charge. If you purchase
Institutional Class shares of the Fund you will pay the NAV per share next
determined after your order is received.
The
following persons are eligible to invest in Institutional Class
shares:
|
1.
|
Institutional
investors including banks, savings institutions, credit unions and other
financial institutions, pension, profit sharing and employee benefit plans
and trusts, insurance companies, investment companies, investment
advisors, broker-dealers and financial advisors acting for their own
accounts or for the accounts of their
clients;
|
|
2.
|
Full-time
employees, agents, employees of agents, retirees and directors (trustees),
and members of their families (i.e., parent, child,
spouse, domestic partner, sibling, set or adopted relationships,
grandparent, grandchild and UTMA accounts naming qualifying persons) of
the Adviser and its affiliated companies;
and
|
|
3.
|
Shareholders
investing through accounts at Poplar Forest Capital, LLC and its
affiliated companies.
|
You may
open a Fund account with a minimum initial investment as listed in the table
below.
|
Minimum
Investment
|
To
Open Your Account
|
To
Add to Your Account
|
|
Regular
Accounts
|
||
|
Class
A shares
|
$25,000
|
$5,000
|
|
Institutional
Class shares
|
$1,000,000
|
$5,000
|
|
Individual
Retirement Accounts (“IRAs”)
|
||
|
Class
A shares
|
$5,000
|
$500
|
At the
discretion of the Adviser, the Fund may waive the minimum initial investment to
establish certain Institutional Class share accounts for clients of a broker or
other financial intermediary that has made contractual arrangements to offer the
Fund.
The Fund
will make distributions of dividends and capital gains, if any, at least
annually, typically in December. The Fund may make an additional payment of
dividends or distributions of capital gains if it deems it desirable at any
other time of the year.
All
distributions will be reinvested in Fund shares unless you choose one of the
following options: (1) receive dividends in cash while reinvesting capital gain
distributions in additional Fund shares; (2) reinvest dividends in
additional Fund shares and receive capital gains in cash; or (3) receive all
distributions in cash.
If you
elect to receive distributions in cash and the U.S. Postal Service cannot
deliver the check, or if a check remains outstanding for six months, the Fund
reserves the right to reinvest the distribution check in your account, at the
Fund’s current NAV per share, and to reinvest all subsequent
distributions. If you wish to change your distribution option, notify
the Transfer Agent in writing in advance of the payment date for the
distribution.
Any
dividend or capital gain distribution paid by the Fund has the effect of
reducing the NAV per share on the ex-dividend date by the amount of the dividend
or capital gain distribution. You should note that a dividend or
capital gain distribution paid on shares purchased shortly before that dividend
or capital gain distribution was declared will be subject to income taxes even
though the dividend or capital gain distribution represents, in substance, a
partial return of capital to you.
The Fund
typically makes distributions of dividends and capital
gains. Dividends are taxable to you as ordinary income or, under
current law, as qualified dividend income, depending on the source of such
income to the distributing Fund and the holding period of the Fund for its
dividend-paying securities and of you for your Fund shares. The rate
you pay on capital gain distributions will depend on how long the Fund held the
securities that generated the gains, not on how long you owned your Fund
shares. You will be taxed in the same manner whether you receive your
dividends and capital gain distributions in cash or reinvest them in additional
Fund shares. Although distributions are generally taxable when
received, certain distributions declared in October, November, or December but
made in January are taxable as if received the prior December.
By law,
the Fund must withhold a percentage of your taxable distributions and redemption
proceeds if you do not provide your correct social security or taxpayer
identification number and certify that you are not subject to backup
withholding, or if the Internal Revenue Service instructs the Fund to do
so.
If you
sell your Fund shares, it is considered a taxable event for
you. Depending on the purchase price and the sale price of the shares
you sell, you may have a gain or a loss on the transaction. You are
responsible for any tax liabilities generated by your transaction.
You
should consult your own tax advisor concerning federal, state and local taxation
of distributions from the Fund.
Financial
highlights are not available at this time because the Fund had not commenced
operations prior to the date of this Prospectus.
Investment
Adviser
Poplar
Forest Capital, LLC
70 South
Lake Avenue, Suite 930
Pasadena,
California 91101
Independent
Registered Public Accounting Firm
[_________________________________]
[_________________________________]
[_________________________________]
Legal
Counsel
Paul,
Hastings, Janofsky & Walker LLP
75 East
55th
Street
New York,
New York 10022-3205
Custodian
U.S. Bank
National Association
Custody
Operations
1555
North River Center Drive, Suite 302
Milwaukee,
Wisconsin 53212
Transfer
Agent, Fund Accountant and Fund Administrator
U.S.
Bancorp Fund Services, LLC
615 East
Michigan Street
Milwaukee,
Wisconsin 53202
Distributor
Quasar
Distributors, LLC
615 East
Michigan Street
Milwaukee,
Wisconsin 53202
The Fund
collects non-public information about you from the following
sources:
|
•
|
Information
we receive about you on applications or other
forms;
|
|
•
|
Information
you give us orally; and/or
|
|
•
|
Information
about your transactions with us or
others.
|
We do not
disclose any non-public personal information about our customers or former
customers without the customer’s authorization, except as permitted by law or in
response to inquiries from governmental authorities. We may share
information with affiliated and unaffiliated third parties with whom we have
contracts for servicing the Fund. We will provide unaffiliated third
parties with only the information necessary to carry out their assigned
responsibilities. We maintain physical, electronic and procedural
safeguards to guard your non-public personal information and require third
parties to treat your personal information with the same high degree of
confidentiality.
In the
event that you hold shares of the Fund through a financial intermediary,
including, but not limited to, a broker-dealer, bank, or trust company, the
privacy policy of your financial intermediary would govern how your non-public
personal information would be shared by those entities with unaffiliated third
parties.
THIS
PAGE IS NOT A PART OF THE PROSPECTUS
POPLAR
FOREST PARTNERS FUND
A series
of Advisors Series Trust
www.poplarforestllc.com
FOR
MORE INFORMATION
You can
find more information about the Fund in the following documents:
Statement
of Additional Information
The SAI
provides additional details about the investments and techniques of the Fund and
certain other additional information. A current SAI is on file with
the SEC and is incorporated into this Prospectus by reference. This
means that the SAI is legally considered a part of this Prospectus even though
it is not physically within this Prospectus.
Annual
and Semi-Annual Reports
The
Fund’s Annual and Semi-Annual Reports (collectively, the “Shareholder Reports”)
provide the most recent financial reports and portfolio listings. The
Annual Report contains a discussion of the market conditions and investment
strategies that affected the Fund’s performance during the Fund’s previous
fiscal year.
The SAI
and Shareholder Reports are available free of charge on the Fund’s website at
www.poplarforestllc.com. You can obtain a free copy of the SAI and
Shareholder Reports, request other information, or make general inquiries about
the Fund by calling the Fund (toll-free) at 1-[8__]-[___]-[____]
or by writing to:
Poplar
Forest Partners Fund
c/o U.S.
Bancorp Fund Services, LLC
P.O. Box
701
Milwaukee,
Wisconsin 53201-0701
www.poplarforestllc.com
You may
review and copy information about the Fund, including the SAI and Shareholder
Reports, at the Public Reference Room of the SEC in Washington,
D.C. You can obtain information on the operation of the Public
Reference Room by calling (202) 551-8090. Reports and other
information about the Fund are also available:
|
•
|
Free
of charge from the SEC’s EDGAR database on the SEC’s website at
http://www.sec.gov;
|
|
•
|
For
a fee, by writing to the Public Reference Section of the SEC, Washington,
D.C. 20549-1520; or
|
|
•
|
For
a fee, by electronic request at the following e-mail address:
publicinfo@sec.gov.
|
(The
Trust’s SEC Investment Company Act file number is 811-07959.)
Subject to Completion—Dated October 15, 2009
The information in this Statement of Additional Information is not
complete and may be changed. We may not sell these securities until
the registration statement filed with the Securities and Exchange Commission is
effective. This Statement of Additional Information is not an offer
to sell these securities and is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.
STATEMENT
OF ADDITIONAL INFORMATION
December
31, 2009
Poplar
Forest Partners Fund
|
Trading
Symbol
|
|
|
Class
A Shares
|
[__]
|
|
Institutional
Class Shares
|
[__]
|
A
Series of Advisors Series Trust
c/o
U.S. Bancorp Fund Services, LLC
P.O.
Box 701
Milwaukee,
Wisconsin 53201-0701
1-[8__]-[___]-[____]
This
Statement of Additional Information (“SAI”) is not a prospectus and it should be
read in conjunction with the Prospectus for the Class A shares and Institutional
Class shares dated December 31, 2009, as may be revised, of the Poplar
Forest Partners Fund (the “Fund”), a series of Advisors Series Trust (the
“Trust”). Poplar Forest Capital, LLC (the “Adviser”) is the Fund’s
investment adviser. A copy of the Prospectus may be obtained by
contacting the Fund at the address or telephone number above or by visiting the
Fund’s website at www.poplarforestllc.com.
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The Trust
is a Delaware statutory trust organized under the laws of the State of Delaware
on October 3, 1996, and is registered with the Securities and Exchange
Commission (the “SEC”) as an open-end management investment
company. The Trust’s Agreement and Declaration of Trust (the
“Declaration of Trust”) permits the Trust’s Board of Trustees (the “Board” or
the “Trustees”) to issue an unlimited number of full and fractional shares of
beneficial interest, par value $0.01 per share, which may be issued in any
number of series. The Trust consists of various series that represent
separate investment portfolios. The Board may from time to time issue
other series, the assets and liabilities of which will be separate and distinct
from any other series. This SAI relates only to the
Fund.
The Fund
had not commenced operations as of the date of this SAI.
Registration
with the SEC does not involve supervision of the management or policies of the
Fund. The Prospectus of the Fund and this SAI omit certain of the
information contained in the Registration Statement filed with the
SEC. Copies of such information may be obtained from the SEC upon
payment of the prescribed fee or may be accessed free of charge at the SEC’s
website at www.sec.gov.
The
discussion below supplements information contained in the Fund’s Prospectus as
to the investment policies and risks of the Fund.
Diversification
The Fund
is diversified under applicable federal securities laws. This means
that as to 75% of its total assets (1) no more than 5% may be invested in the
securities of a single issuer, and (2) it may not hold more than 10% of the
outstanding voting securities of a single issuer. However, the
diversification of a mutual fund’s holdings is measured at the time the fund
purchases a security and if the Fund purchases a security and holds it for a
period of time, the security may become a larger percentage of the Fund’s total
assets due to movements in the financial markets. If the market
affects several securities held by the Fund, the Fund may have a greater
percentage of its assets invested in securities of fewer
issuers. Accordingly, the Fund is subject to the risk that its
performance may be hurt disproportionately by the poor performance of relatively
few securities despite qualifying as a diversified fund.
Percentage
Limitations
Whenever
an investment policy or limitation states a maximum percentage of the Fund’s
assets that may be invested in any security or other asset, or sets forth a
policy regarding quality standards, such standard or percentage limitation will
be determined immediately after and as a result of the Fund’s acquisition or
sale of such security or other asset. Accordingly, except with
respect to borrowing and illiquid securities, any subsequent change in values,
net assets or other circumstances will not be considered in determining whether
an investment complies with the Fund’s investment policies and
limitations. In addition, if a bankruptcy or other extraordinary
event occurs concerning a particular investment by the Fund, the Fund may
receive stock, real estate or other investments that the Fund would not, or
could not buy. If this happens the Fund would sell such investments
as soon as practicable while trying to maximize the return to its
shareholders.
The Fund
may invest in the following types of investments, each of which is subject to
certain risks, as discussed below:
Equity
Securities
Common
stocks, convertible securities, rights, warrants and American Depositary
Receipts (“ADRs”) are examples of equity securities in which the Fund may
invest.
All
investments in equity securities are subject to market risks that may cause
their prices to fluctuate over time. Historically, the equity markets
have moved in cycles and the value of the securities in the Fund’s portfolio may
fluctuate substantially from day to day. Owning an equity security
can also subject the Fund to the risk that the issuer may discontinue paying
dividends.
The
economic crisis that begin to unfold in 2007 continues to manifest itself in
nearly all areas of the U.S. economy and has caused dramatic volatility in the
financial markets, as well as a significant decrease in the value of many
financial institutions, including, in general, a decrease in the value of stocks
and bonds. The U.S. government has taken a number of measures to
attempt to restore stability to the financial markets and to promote economic
recovery. The measures have included various programs to stimulate
economic activity, to reform regulatory oversight, to advance various social
goals and to provide relief to businesses and individuals suffering from the
effects of the economic crisis. There is no guarantee that any of
these programs or other efforts will be successful and therefore there is no
guarantee that the financial markets or stock and bond values will stabilize in
the near future.
Common Stocks. A
common stock represents a proportionate share of the ownership of a company and
its value is based on the success of the company’s business, any income paid to
stockholders, the value of its assets, and general market
conditions. In addition to the general risks set forth above,
investments in common stocks are subject to the risk that in the event a company
in which the Fund invests is liquidated, the holders of preferred stock and
creditors of that company will be paid in full before any payments are made to
the Fund as a holder of common stock. It is possible that all assets
of that company will be exhausted before any payments are made to the
Fund.
Convertible
Securities. The Fund may invest in convertible
securities. Traditional convertible securities include corporate
bonds, notes and preferred stocks that may be converted into or exchanged for
common stock, and other securities that also provide an opportunity for equity
participation. These securities are convertible either at a stated
price or a stated rate (that is, for a specific number of shares of common stock
or other security). As with other fixed income securities, the price
of a convertible security generally varies inversely with interest
rates. While providing a fixed income stream, a convertible security
also affords the investor an opportunity, through its conversion feature, to
participate in the capital appreciation of the common stock into which it is
convertible. As the market price of the underlying common stock
declines, convertible securities tend to trade increasingly on a yield basis and
so may not experience market value declines to the same extent as the underlying
common stock. When the market price of the underlying common stock
increases, the price of a convertible security tends to rise as a reflection of
higher yield or capital appreciation. In such situations, the Fund
may have to pay more for a convertible security than the value of the underlying
common stock.
Rights and
Warrants. The Fund may invest in rights and
warrants. A right is a privilege granted to existing shareholders of
a corporation to subscribe to shares of a new issue of common stock and it is
issued at a predetermined price in proportion to the number of shares already
owned. Rights normally have a short life, usually two to four weeks,
are freely transferable and entitle the holder to busy the new common stock at a
lower price than the current market. Warrants are options to purchase
equity securities at a specific price for a specific period of
time. They do not represent ownership of the securities, but only the
right to buy them. Hence, warrants have no voting rights, pay no
dividends and have no rights with respect to the assets of the corporation
issuing them. The value of warrants is derived solely from capital
appreciation of the underlying equity securities. Warrants differ
from call options in that the underlying corporation issues warrants, whereas
call options may be written by anyone.
An
investment in rights and warrants may entail greater risks than certain other
types of investments. Generally, rights and warrants do not carry the
right to receive dividends or exercise voting rights with respect to the
underlying securities, and they do not represent any rights in the assets of the
issuer. In addition, although their value is influenced by the value
of the underlying security, their value does not necessarily change with the
value of the underlying securities, and they cease to have value if they are not
exercised on or before their expiration date. Investing in rights and
warrants increases the potential profit or loss to be realized from the
investment as compared with investing the same amount in the underlying
securities.
Small
and Medium-Sized Companies
To the
extent the Fund invests in the equity securities of small and medium-sized
companies, it will be exposed to the risks of smaller sized
companies. Small and medium-sized companies may have narrower markets
for their goods and/or services and may have more limited managerial and
financial resources than larger, more established
companies. Furthermore, such companies may have limited product
lines, services, markets, or financial resources or may be dependent on a small
management group. In addition, because these stocks may not be
well-known to the investing public, do not have significant institutional
ownership or are typically followed by fewer security analysts, there will
normally be less publicly available information concerning these securities
compared to what is available for the securities of larger
companies. Adverse publicity and investor perceptions, whether or not
based on fundamental analysis, can decrease the value and liquidity of
securities held by the Fund. As a result, their performance can be
more volatile and they face greater risk of business failure, which could
increase the volatility of the Fund’s portfolio.
Investment
Companies
The Fund
may invest in shares of other registered investment companies, including
exchange-traded funds (“ETFs”), money market mutual funds and other mutual funds
in pursuit of its investment objective, in accordance with the limitations
established under the Investment Company Act of 1940, as amended (the “1940
Act”). This may include investments in money market mutual funds in connection
with the Fund’s management of daily cash positions. Investments in the
securities of other investment companies may involve duplication of advisory
fees and certain other expenses. By investing in another investment
company, the Fund becomes a shareholder of that investment
company. As a result, Fund shareholders indirectly will bear the
Fund’s proportionate share of the fees and expenses paid by shareholders of the
other investment company, in addition to the fees and expenses Fund shareholders
directly bear in connection with the Fund’s own operations.
Section
12(d)(1)(A) of the 1940 Act generally prohibits a fund from purchasing (1) more
than 3% of the total outstanding voting stock of another fund; (2) securities of
another fund having an aggregate value in excess of 5% of the value of the
acquiring fund; and (3) securities of the other fund and all other funds having
an aggregate value in excess of 10% of the value of the total assets of the
acquiring fund. There are some exceptions, however, to these
limitations pursuant to various rules promulgated by the SEC.
Exchange-Traded
Funds. ETFs are open-end investment companies whose shares are
listed on a national securities exchange. An ETF is similar to a
traditional mutual fund, but trades at different prices during the day on a
security exchange like a stock. Similar to investments in other
investment companies discussed above, the Fund’s investments in ETFs will
involve duplication of advisory fees and other expenses since the Fund will be
investing in another investment company. In addition, the Fund’s
investment in ETFs is also subject to its limitations on investments in
investment companies discussed above. To the extent the Fund invests
in ETFs which focus on a particular market segment or industry, the Fund will
also be subject to the risks associated with investing in those sectors or
industries. The shares of the ETFs in which the Fund will invest will
be listed on a national securities exchange and the Fund will purchase or sell
these shares on the secondary market at its current market price, which may be
more or less than its net asset value (“NAV”) per share.
As a
purchaser of ETF shares on the secondary market, the Fund will be subject to the
market risk associated with owning any security whose value is based on market
price. ETF shares historically have tended to trade at or near their
NAV, but there is no guarantee that they will continue to do
so. Unlike traditional mutual funds, shares of an ETF may be
purchased and redeemed directly from the ETFs only in large blocks (typically
50,000 shares or more) and only through participating organizations that have
entered into contractual agreements with the ETF. The Fund does not
expect to enter into such agreements and therefore will not be able to purchase
and redeem its ETF shares directly from the ETF.
Foreign
Investments
The Fund
may make investments in securities of non-U.S. issuers (“foreign
securities”). The Fund reserves the right to invest up to 15% of its
net assets in Depositary Receipts (“DRs”), U.S. dollar-denominated securities,
foreign securities and securities of companies incorporated outside the
U.S.
Depositary Receipts. Depositary Receipts
include ADRs, European Depositary Receipts (“EDRs”), Global Depositary Receipts
(“GDRs”) or other forms of DRs. DRs are receipts typically issued in
connection with a U.S. or foreign bank or trust company which evidence ownership
of underlying securities issued by a non-U.S. company.
ADRs are
depositary receipts for foreign securities denominated in U.S. dollars and
traded on U.S. securities markets. These securities may not
necessarily be denominated in the same currency as the securities for which they
may be exchanged. These are certificates evidencing ownership of
shares of a foreign-based issuer held in trust by a bank or similar financial
institutions. Designed for use in U.S. securities markets, ADRs are
alternatives to the purchase of the underlying securities in their national
market and currencies. ADRs may be purchased through “sponsored” or
“unsponsored” facilities. A sponsored facility is established jointly
by the issuer of the underlying security and a depositary, whereas a depositary
may establish an unsponsored facility without participation by the issuer of the
depositary security. Holders of unsponsored depositary receipts
generally bear all the costs of such facilities and the depositary of an
unsponsored facility frequently is under no obligation to distribute shareholder
communications received from the issuer of the deposited security or to pass
through voting rights to the holders of such receipts of the deposited
securities.
Risks of Investing in Foreign
Securities. Investments in foreign securities involve certain
inherent risks, including the following:
Political and Economic
Factors. Individual economies of certain countries may differ
favorably or unfavorably from the United States’ economy in such respects as
growth of gross national product, rate of inflation, capital reinvestment,
resource self-sufficiency, diversification and balance of payments
position. The internal politics of certain foreign countries may not
be as stable as those of the United States. Governments in certain
foreign countries also continue to participate to a significant degree, through
ownership interest or regulation, in their respective
economies. Action by these governments could include restrictions on
foreign investment, nationalization, expropriation of goods or imposition of
taxes, and could have a significant effect on market prices of securities and
payment of interest. The economies of many foreign countries are
heavily dependent upon international trade and are accordingly affected by the
trade policies and economic conditions of their trading
partners. Enactment by these trading partners of protectionist trade
legislation could have a significant adverse effect upon the securities markets
of such countries.
Legal and Regulatory
Matters. Certain foreign countries may have less supervision
of securities markets, brokers and issuers of securities, and less financial
information available to issuers, than is available in the United
States.
Currency
Fluctuations. A change in the value of any foreign currency
against the U.S. dollar will result in a corresponding change in the U.S. dollar
value of an ADR’s underlying portfolio securities denominated in that
currency. Such changes will affect the Fund to the extent that the
Fund is invested in ADRs comprised of foreign securities.
Taxes. The
interest and dividends payable to the Fund on certain of the Fund’s foreign
securities may be subject to foreign taxes or withholding, thus reducing the net
amount of income available for distribution to Fund shareholders. The
Fund may not be eligible to pass through to its shareholders any tax credits or
deductions with respect to such foreign taxes or withholding.
In
considering whether to invest in the securities of a non-U.S. company, the
Adviser considers such factors as the characteristics of the particular company,
differences between economic trends and the performance of securities markets
within the U.S. and those within other countries, and also factors relating to
the general economic, governmental and social conditions of the country or
countries where the company is located. The extent to which the Fund
will be invested in non-U.S. companies, foreign countries and depositary
receipts will fluctuate from time to time within any limitations described in
the Prospectus, depending on the Adviser’s assessment of prevailing market,
economic and other conditions.
Emerging Markets. The Fund
may invest up to 5% of its net assets in foreign securities that may include
securities of companies located in developing or emerging markets, which entail
additional risks, including: less social, political and economic stability;
smaller securities markets and lower trading volume, which may result in less
liquidity and greater price volatility; national policies that may restrict an
underlying fund’s investment opportunities, including restrictions on
investments in issuers or industries, or expropriation or confiscation of assets
or property; and less developed legal structures governing private or foreign
investment.
Options
The Fund
may write call options on stocks and stock indices if the calls are “covered”
throughout the life of the option. A call is “covered” if the Fund
owns the optioned securities. When the Fund writes a call, they
receive a premium and give the purchaser the right to buy the underlying
security at any time during the call period at a fixed exercise price regardless
of market price changes during the call period. If the call is
exercised, the Fund will forgo any gain from an increase in the market price of
the underlying security over the exercise price.
Writing Call Options - When
the Fund writes a call option it assumes an obligation to sell specified
securities to the holder of the option at a specified price if the option is
exercised at any time before the expiration date.
Call
writers expect to profit if prices remain the same or fall. The Fund could
try to hedge against a decline in the value of securities it already owns by
writing a call option. If the price of that security falls as
expected, the Fund would expect the option to expire and the premium it received
to offset the decline of the security’s value. However, the Fund must
be prepared to deliver the underlying instrument in return for the strike price,
which may deprive it of the opportunity to profit from an increase in the market
price of the securities it holds.
The Fund
is permitted only to write covered options. The Fund can cover a call
option by owning:
|
•
|
The
underlying security (or securities convertible into the underlying
security without additional consideration), index, interest rate, foreign
currency or futures contract;
|
|
•
|
A
call option on the same security or index with the same or lesser exercise
price;
|
|
•
|
A
call option on the same security or index with a greater exercise price
and segregating cash or liquid securities in an amount equal to the
difference between the exercise
prices;
|
|
•
|
Cash
or liquid securities equal to at least the market value of the optioned
securities, interest rate, foreign currency or futures contract;
or
|
|
•
|
In
the case of an index, the fund of securities that corresponds to the
index.
|
Options on Securities Indices
- Options on securities indices are similar to options on securities, except
that the exercise of securities index options requires cash settlement payments
and does not involve the actual purchase or sale of securities. In
addition, securities index options are designed to reflect price fluctuations in
a group of securities or segment of the securities market, rather than price
fluctuations in a single security.
Risks of Derivatives - While
transactions in derivatives may reduce certain risks, these transactions
themselves entail certain other risks. For example, unanticipated
changes in interest rates, securities prices or currency exchange rates may
result in a poorer overall performance of the Fund than if it had not entered
into any derivatives transactions. Derivatives may magnify the Fund’s
gains or losses, causing it to make or lose substantially more than it
invested.
When used
for hedging purposes, increases in the value of the securities the Fund holds or
intends to acquire should offset any losses incurred with a
derivative. Purchasing derivatives for purposes other than hedging
could expose the Fund to greater risks.
Derivative Management Risk -
If the Adviser incorrectly predicts stock market and interest rate trends, the
Fund may lose money by investing in derivatives. For example, if the
Fund were to write a call option based on its Adviser’s expectation that the
price of the underlying security would fall, but the price were to rise instead,
the Fund could be required to sell the security upon exercise at a price below
the current market price.
Short-Term,
Temporary, and Cash Investments
The Fund
may invest in any of the following securities and instruments:
Bank Certificates of Deposit,
Bankers’ Acceptances and Time Deposits. The Fund may acquire
certificates of deposit, bankers’ acceptances and time
deposits. Certificates of deposit are negotiable certificates issued
against funds deposited in a commercial bank for a definite period of time and
earning a specified return. Bankers’ acceptances are negotiable
drafts or bills of exchange, normally drawn by an importer or exporter to pay
for specific merchandise, which are “accepted” by a bank, meaning in effect that
the bank unconditionally agrees to pay the face value of the instrument on
maturity. Certificates of deposit and bankers’ acceptances acquired
by the Fund will be dollar denominated obligations of domestic or foreign banks
or financial institutions which at the time of purchase have capital, surplus
and undivided profits in excess of $100 million (including assets of both
domestic and foreign branches), based on latest published reports, or less than
$100 million if the principal amount of such bank obligations are fully insured
by the U.S. Government. If the Fund holds instruments of foreign
banks or financial institutions, it may be subject to additional investment
risks that are different in some respects from those incurred by a fund that
invests only in debt obligations of U.S. domestic issuers. See
“Foreign Securities” above. Such risks include future political and
economic developments, the possible imposition of withholding taxes by the
particular country in which the issuer is located on interest income payable on
the securities, the possible seizure or nationalization of foreign deposits, the
possible establishment of exchange controls or the adoption of other foreign
governmental restrictions which might adversely affect the payment of principal
and interest on these securities.
Domestic
banks and foreign banks are subject to different governmental regulations with
respect to the amount and types of loans which may be made and interest rates
which may be charged. In addition, the profitability of the banking
industry depends largely upon the availability and cost of funds for the purpose
of financing lending operations under prevailing money market
conditions. General economic conditions as well as exposure to credit
losses arising from possible financial difficulties of borrowers play an
important part in the operations of the banking industry.
As a
result of federal and state laws and regulations, domestic banks are, among
other things, required to maintain specified levels of reserves, limited in the
amount which they can loan to a single borrower, and subject to other
regulations designed to promote financial soundness. However, such
laws and regulations do not necessarily apply to foreign bank obligations that
the Fund may acquire.
In
addition to purchasing certificates of deposit and bankers’ acceptances, to the
extent permitted under its investment objectives and policies stated above and
in its Prospectus, the Fund may make interest bearing time or other interest
bearing deposits in commercial or savings banks. Time deposits are
non-negotiable deposits maintained at a banking institution for a specified
period of time at a specified interest rate.
Savings Association Obligations.
The Fund may invest in certificates of deposit (interest bearing time
deposits) issued by savings banks or savings and loan associations that have
capital, surplus and undivided profits in excess of $100 million, based on
latest published reports, or less than $100 million if the principal amount of
such obligations is fully insured by the U.S. Government.
Commercial Paper, Short Term Notes
and Other Corporate Obligations. The Fund may invest a portion of its
assets in commercial paper and short term notes. Commercial paper
consists of unsecured promissory notes issued by corporations. Issues
of commercial paper and short term notes will normally have maturities of less
than nine months and fixed rates of return, although such instruments may have
maturities of up to one year.
Commercial
paper and short term notes will consist of issues rated at the time of purchase
“A-2” or higher by Standard & Poor’s (“S&P”), “Prime-1” by Moody’s
Investors Service, Inc. (“Moody’s”), or similarly rated by another nationally
recognized statistical rating organization or, if unrated, will be determined by
the Adviser to be of comparable quality. These rating symbols are
described in Appendix B.
Government
Obligations
The Fund
may make short term investments in U.S. Government obligations. Such
obligations include Treasury bills, certificates of indebtedness, notes and
bonds, and issues of such entities as the Government National Mortgage
Association (“GNMA”), Export Import Bank of the United States, Tennessee Valley
Authority, Resolution Funding Corporation, Farmers Home Administration, Federal
Home Loan Banks, Federal Intermediate Credit Banks, Federal Farm Credit Banks,
Federal Land Banks, Federal Housing Administration, Federal National Mortgage
Association (“FNMA”), Federal Home Loan Mortgage Corporation (“FHLMC”), and the
Student Loan Marketing Association.
Some of
these obligations, such as those of the GNMA, are supported by the full faith
and credit of the U.S. Treasury Department; others, such as those of the
Export-Import Bank of the United States, are supported by the right of the
issuer to borrow from the U.S. Treasury; others, such as those of the FNMA, are
supported by the discretionary authority of the U.S. Government to purchase the
agency’s obligations; still others, such as those of the Student Loan Marketing
Association, are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. Government
would provide financial support to U.S. Government-sponsored instrumentalities
if it is not obligated to do so by law.
8
The Fund
may invest in sovereign debt obligations of foreign countries. A
sovereign debtor’s willingness or ability to repay principal and interest in a
timely manner may be affected by a number of factors, including its cash flow
situation, the extent of its foreign reserves, the availability of sufficient
foreign exchange on the date a payment is due, the relative size of the debt
service burden to the economy as a whole, the sovereign debtor’s policy toward
principal international lenders and the political constraints to which it may be
subject. Emerging market governments could default on their sovereign
debt. Such sovereign debtors also may be dependent on expected
disbursements from foreign governments, multilateral agencies and other entities
abroad to reduce principal and interest arrearages on their debt. The
commitments on the part of these governments, agencies and others to make such
disbursements may be conditioned on a sovereign debtor’s implementation of
economic reforms and/or economic performance and the timely service of such
debtor’s obligations. Failure to meet such conditions could result in
the cancellation of such third parties’ commitments to lend funds to the
sovereign debtor, which may further impair such debtor’s ability or willingness
to service its debt in a timely manner.
When-Issued
Securities
The Fund
may purchase securities on a when-issued basis, for payment and delivery at a
later date, generally within one month. The price and yield are
generally fixed on the date of commitment to purchase, and the value of the
security is thereafter reflected in the Fund’s NAV. During the period
between purchase and settlement, no payment is made by the Fund and no interest
accrues to the Fund. At the time of settlement, the market value of
the security may be more or less than the purchase price. When the
Fund purchases securities on a when-issued basis, it maintains liquid assets in
a segregated account with its custodian in an amount equal to the purchase price
as long as the obligation to purchase continues.
Corporate
Debt Securities
The Fund
may invest up to 25% of its net assets in fixed-income securities of any
maturity. Up to 10% of the Fund's net asset will be invested in fixed
income securities rated at least “investment grade” by one or more recognized
statistical ratings organizations, such as Standard & Poor’s Ratings Group
(“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”). Up to 5%
of the Fund’s net assets may be invested in debt securities rated below
investment grade. Bonds rated below BBB by S&P or Baa by Moody’s,
commonly referred to as “junk bonds,” typically carry higher coupon rates than
investment grade bonds, but also are described as speculative by both S&P
and Moody’s and may be subject to greater market price fluctuations, less
liquidity and greater risk of income or principal including greater possibility
of default and bankruptcy of the issuer of such securities than more highly
rated bonds. Lower-rated bonds also are more likely to be sensitive
to adverse economic or company developments and more subject to price
fluctuations in response to changes in interest rates. The market for
lower-rated debt issues generally is thinner and less active than that for
higher quality securities, which may limit the Fund’s ability to sell such
securities at fair value in response to changes in the economy or financial
markets. During periods of economic downturn or rising interest
rates, highly leveraged issuers of lower-rated securities may experience
financial stress which could adversely affect their ability to make payments of
interest and principal and increase the possibility of default.
Ratings
of debt securities represent the rating agencies’ opinions regarding their
quality, are not a guarantee of quality and may be reduced after the Fund has
acquired the security. If a security’s rating is reduced while it is
held by the Fund, the Adviser will consider whether the Fund should continue to
hold the security but is not required to dispose of it. Credit
ratings attempt to evaluate the safety of principal and interest payments and do
not evaluate the risks of fluctuations in market value. Also, rating
agencies may fail to make timely changes in credit ratings in response to
subsequent events, so that an issuer’s current financial conditions may be
better or worse than the rating indicates. The ratings for corporate
debt securities are described in Appendix A.
Illiquid
Securities
As a
non-principal strategy, the Fund may hold up to 5% of its net assets in
securities that are illiquid at the time of purchase, which means that there may
be legal or contractual restrictions on their disposition, or that there are no
readily available market quotations for such a security. Illiquid
securities present the risks that the Fund may have difficulty valuing these
holdings and/or may be unable to sell these holdings at the time or price
desired. There are generally no restrictions on the Fund’s ability to
invest in restricted securities (that is, securities that are not registered
pursuant to the Securities Act), except to the extent such securities may be
considered illiquid. Securities issued pursuant to Rule 144A of the
Securities Act (“Rule 144A securities”) will be considered liquid if determined
to be so under procedures adopted by the Board of Trustees. The
Adviser is responsible for making the determination as to the liquidity of
restricted securities (pursuant to the procedures adopted by the Board of
Trustees). The Fund will determine a security to be illiquid if it
cannot be sold or disposed of in the ordinary course of business within seven
days at the value at which the Fund has valued the security. Factors
considered in determining whether a security is illiquid may include, but are
not limited to: the frequency of trades and quotes for the security; the number
of dealers willing to purchase and sell the security and the number of potential
purchasers; the number of dealers who undertake to make a market in the
security; the nature of the security, including whether it is registered or
unregistered, and the market place; whether the security has been rated by a
nationally recognized statistical rating organization (“NRSRO”); the period of
time remaining until the maturity of a debt instrument or until the principal
amount of a demand instrument can be recovered through demand; the nature of any
restrictions on resale; and with respect to municipal lease obligations and
certificates of participation, there is reasonable assurance that the obligation
will remain liquid throughout the time the obligation is held and, if unrated,
an analysis similar to that which would be performed by an NRSRO is
performed. If a restricted security is determined to be liquid, it
will not be included within the category of illiquid
securities. Investing in Rule 144A securities could have the effect
of increasing the level of the Fund’s illiquidity to the extent that the Fund,
at a particular point in time may be unable to find qualified institutional
buyers interested in purchasing the securities. The Fund is permitted
to sell restricted securities to qualified institutional buyers.
The Trust
(on behalf of the Fund) has adopted the following restrictions as fundamental
policies, which may not be changed without the affirmative vote of the holders
of a “majority of the Fund’s outstanding voting securities” as defined in the
1940 Act. Under the 1940 Act, the “vote of the holders of a majority
of the outstanding voting securities” means the vote of the holders of the
lesser of (i) 67% of the shares of the Fund represented at a meeting at
which the holders of more than 50% of its outstanding shares are represented or
(ii) more than 50% of the outstanding shares of the Fund.
The Fund
may not:
|
|
1.
|
With
respect to 75% of its total assets, invest more than 5% of its total
assets in securities of a single issuer or hold more than 10% of the
voting securities of such issuer. (Does not apply to
investments in the securities of other investment companies or securities
of the U.S. Government, its agencies or
instrumentalities.)
|
|
|
2.
|
Borrow
money, except as permitted under the 1940
Act.
|
|
|
3.
|
Issue
senior securities, except as permitted under the 1940
Act.
|
|
|
4.
|
Engage
in the business of underwriting securities, except to the extent that the
Fund may be considered an underwriter within the meaning of the Securities
Act of 1933 in the disposition of restricted
securities.
|
|
|
5.
|
Invest
25% or more of the market value of its total assets in the securities of
companies engaged in any one industry. (Does not apply to
investments in the securities of other investment companies or securities
of the U.S. Government, its agencies or
instrumentalities.)
|
|
|
6.
|
Purchase
or sell real estate, which term does not include securities of companies
which deal in real estate and/or mortgages or investments secured by real
estate, or interests therein, except that the Fund reserves freedom of
action to hold and to sell real estate acquired as a result of the Fund’s
ownership of securities.
|
|
|
7.
|
Purchase
or sell physical commodities or contracts relating to physical
commodities.
|
|
|
8.
|
Make
loans to others, except as permitted under the 1940
Act.
|
The Fund
observes the following policies, which are not deemed fundamental and which may
be changed without shareholder vote. The Fund may not:
|
|
1.
|
Invest
in any issuer for purposes of exercising control or
management.
|
|
|
2.
|
Purchase
securities on margin or make short
sales.
|
|
|
3.
|
Invest
in securities of other investment companies, except as permitted under the
1940 Act.
|
|
|
4.
|
Hold,
in the aggregate, more than 15% of its net assets in illiquid securities
which includes securities with legal or contractual restrictions on
resale, securities which are not readily marketable and repurchase
agreements with more than seven days to
maturity.
|
|
|
5.
|
Purchase
or sell options.
|
|
|
6.
|
Lend
portfolio securities.
|
Although
the Fund generally will not invest for short-term trading purposes, portfolio
securities may be sold without regard to the length of time they have been held
when, in the opinion of the Adviser, investment considerations warrant such
action. Portfolio turnover rate is calculated by dividing
(1) the lesser of purchases or sales of portfolio securities for the fiscal
year by (2) the monthly average of the value of portfolio securities owned
during the fiscal year. A 100% turnover rate would occur if all the
securities in the Fund’s portfolio, with the exception of securities whose
maturities at the time of acquisition were one year or less, were sold and
either repurchased or replaced within one year. A high rate of
portfolio turnover (100% or more) generally leads to higher transaction costs
and may result in a greater number of taxable transactions.
High
portfolio turnover generally results in the distribution of short-term capital
gains which are taxed at the higher ordinary income tax rates.
The
overall management of the Trust’s business and affairs is invested with its
Board. The Board approves all significant agreements between the
Trust and persons or companies furnishing services to it, including the
agreements with the Adviser, Administrator, Custodian and Transfer Agent, each
as defined below. The day-to-day operations of the Trust are
delegated to its officers, subject to the Fund’s investment objective,
strategies and policies and to the general supervision of the Board. The
Trustees and officers of the Trust, their ages, birth dates, and positions with
the Trust, terms of office with the Trust and length of time served, their
business addresses and principal occupations during the past five years and
other directorships held are set forth in the table below. Unless noted
otherwise, each person has held the position listed for a minimum of five
years.
Independent
Trustees(1)
|
Name,
Address
and
Age
|
Position
Held
with
the Trust
|
Term
of Office and
Length
of Time Served
|
Principal
Occupation
During
Past Five Years
|
Number
of Portfolios
in
Fund Complex
Overseen by Trustee(2)
|
Other
Directorships Held
|
|
Michael
D. LeRoy
(age
62, dob 8/14/1947)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Trustee
|
Indefinite
term
since
December 2008.
|
President,
Crown Capital Advisors, LLC (financial consulting firm) (2000 to
present).
|
1
|
Director,
Wedbush Bank.
|
|
Donald
E. O’Connor
(age
73, dob 6/18/1936)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Trustee
|
Indefinite
term
since
February 1997.
|
Retired;
former Financial Consultant and former Executive Vice President and Chief
Operating Officer of ICI Mutual Insurance Company (until January
1997).
|
1
|
Trustee,
The Forward Funds (35 portfolios).
|
|
Name,
Address
and
Age
|
Position
Held
with
the Trust
|
Term
of Office and
Length
of Time Served
|
Principal
Occupation
During
Past Five Years
|
Number
of Portfolios
in
Fund Complex
Overseen by Trustee(2)
|
Other
Directorships Held
|
|
George
Rebhan
(age
75, dob 7/10/1934)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Trustee
|
Indefinite
term
since
May 2002.
|
Retired;
formerly President, Hotchkis and Wiley Funds (mutual funds) (1985 to
1993).
|
1
|
None.
|
|
George
T. Wofford
(age
70, dob 10/8/1939)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Trustee
|
Indefinite
term
since
February 1997.
|
Retired;
formerly Senior Vice President, Federal Home Loan Bank of San
Francisco.
|
1
|
None.
|
Interested
Trustee
|
Name,
Address
and
Age
|
Position
with
the
Trust
|
Term
of Office and Length of Time Served
|
Principal
Occupation
During
Past Five Years
|
Number
of Portfolios
in
Fund Complex
Overseen
by Trustees(2)
|
Other
Directorships Held
|
|
Joe
D. Redwine(3)
(age
62, dob 7/9/1947)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Interested
Trustee
|
Indefinite
term since September 2008.
|
President,
CEO, U.S. Bancorp Fund Services, LLC since May 1991.
|
1
|
None.
|
Officers
|
Name,
Address
and
Age
|
Position
Held
with
the Trust
|
Term
of Office and
Length
of Time Served
|
Principal
Occupation
During
Past Five Years
|
|
Joe
D. Redwine
(age
62, dob 7/9/1947)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Chairman
and Chief Executive Officer
|
Indefinite
term
since
September 2007.
|
President,
CEO, U.S. Bancorp Fund Services, LLC (May 1991 to
present).
|
|
Douglas
G. Hess
(age
42, dob 7/19/1967)
615
E. Michigan Street
Milwaukee,
WI 53202
|
President
and Principal Executive Officer
|
Indefinite
term
since
June 2003.
|
Vice
President, Compliance and Administration, U.S. Bancorp Fund Services, LLC
(March 1997 to present).
|
|
Cheryl
L. King
(age
48, dob 8/27/1961)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Treasurer
and Principal Financial Officer
|
Indefinite
term
since
December 2007.
|
Assistant
Vice President, Compliance and Administration, U.S. Bancorp Fund Services,
LLC (October 1998 to present).
|
|
Michael
L. Ceccato
(age
52, dob 9/11/1957)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Vice
President, Chief Compliance Officer and AML Officer
|
Indefinite
term
since
September 2009.
|
Vice
President, U.S. Bancorp Fund Services, LLC (February 2008 to present);
General Counsel/Controller, Steinhafels, Inc. (September 1995 to February
2008).
|
|
Name,
Address
and
Age
|
Position
Held
with
the Trust
|
Term
of Office and
Length
of Time Served
|
Principal
Occupation
During
Past Five Years
|
|
Jeanine
M. Bajczyk, Esq.
(age
44, dob 4/16/1965)
615
E. Michigan Street
Milwaukee,
WI 53202
|
Secretary
|
Indefinite
term
since
June 2007.
|
Vice
President and Counsel, U.S. Bancorp Fund Services, LLC (May 2006 to
present); Senior Counsel, Wells Fargo Funds Management, LLC (May 2005 to
May 2006); Senior Counsel, Strong Financial Corporation (January 2002 to
April 2005).
|
|
(1)
|
The
Trustees of the Trust who are not “interested persons” of the Trust as
defined under the 1940 Act (“Independent
Trustees”).
|
|
(2)
|
The
Trust is comprised of numerous portfolios managed by unaffiliated
investment advisers. The term “Fund Complex” applies only to
the Fund. The Fund does not hold itself out as related to any
other series within the Trust for investment purposes, nor does it share
the same investment adviser with any other
series.
|
|
(3)
|
Mr.
Redwine is an “interested person” of the Trust as defined by the 1940
Act. Mr. Redwine is an interested Trustee of the Trust by
virtue of the fact that he is an interested person of Quasar Distributors,
LLC which acts as principal underwriter to the series of the
Trust.
|
Board
Committees
The Trust
has four standing committees: The Audit Committee, the Qualified Legal
Compliance Committee (“QLCC”), the Nominating Committee and the Valuation
Committee.
The Audit
Committee is comprised of all of the Independent Trustees. It does
not include any interested Trustees. The Audit Committee typically
meets once per year with respect to the various series of the
Trust. The function of the Audit Committee, with respect to each
series of the Trust, is to review the scope and results of the audit and any
matters bearing on the audit or the Fund’s financial statements and to ensure
the integrity of the Fund’s pricing and financial reporting.
The Audit
Committee also serves as the QLCC for the Trust for the purpose of compliance
with Rules 205.2(k) and 205.3(c) of the Code of Federal Regulations,
regarding alternative reporting procedures for attorneys retained or employed by
an issuer who appear and practice before the Securities and Exchange Commission
on behalf of the issuer (the “issuer attorneys”). An issuer’s
attorney who becomes aware of evidence of a material violation by the Trust, or
by any officer, director, employee, or agent of the Trust, may report evidence
of such material violation to the QLCC as an alternative to the reporting
requirements of Rule 205.3(b) (which requires reporting to the chief legal
officer and potentially “up the ladder” to other entities).
The
Nominating Committee is responsible for seeking and reviewing candidates for
consideration as nominees for Trustees as is considered necessary from time to
time and meets only as necessary. Messrs. LeRoy, O’Connor, Rebhan and
Wofford currently comprise the Nominating Committee.
The
Nominating Committee will consider nominees recommended by
shareholders. Recommendations for consideration by the Nominating
Committee should be sent to the President of the Trust in writing together with
the appropriate biographical information concerning each such proposed Nominee,
and such recommendation must comply with the notice provisions set forth in the
Trust’s By-Laws. In general, to comply with such procedures, such
nominations, together with all required biographical information, must be
delivered to and received by the President of the Trust at the principal
executive offices of the Trust not later than 60 days’ prior to the shareholder
meeting at which any such nominee would be voted on.
The
Trust’s Board has delegated day-to-day valuation issues to a Valuation Committee
that is comprised of one or more Trustees and representatives from the
Administrator’s staff. The function of the Valuation Committee is to
value securities held by any series of the Trust for which current and reliable
market quotations are not readily available. Such securities are
valued at their respective fair values as determined in good faith by the
Valuation Committee and the actions of the Valuation Committee are subsequently
reviewed and ratified by the Board. The Valuation Committee meets as
needed.
Trustee
Ownership of Fund Shares and Other Interests
No
Trustee owned shares of the Fund as of the calendar year ended December 31,
2008, which is prior to the inception date of the Fund.
As of
December 31, 2008, neither the Independent Trustees nor members of their
immediate family, own securities beneficially or of record in the Adviser, the
Distributor, as defined below, or an affiliate of the Adviser or
Distributor. Accordingly, neither the Independent Trustees nor
members of their immediate family, have direct or indirect interest, the value
of which exceeds $120,000, in the Adviser, the Distributor or any of their
affiliates. In addition, during the two most recently
completed calendar years, neither the Independent Trustees nor members of their
immediate families have conducted any transactions (or series of transactions)
in which the amount involved exceeds $120,000 and to which the Adviser, the
Distributor or any affiliate thereof was a party.
Compensation
Set forth
below is the anticipated compensation to be received by the Independent Trustees
from the Fund for the fiscal year ending September 30, 2010. The
Independent Trustees receive an annual trustee fee of $44,000 per year with no
additional fee for special meetings. The Trustees also receive
reimbursement from the Trust for expenses incurred in connection with attendance
at regular meetings. The Trust has no pension or retirement
plan. No other entity affiliated with the Trust pays any compensation
to the Trustees.
|
Aggregate
Compensation
from the Fund(1)
|
Pension
or Retirement Benefits Accrued as Part of Fund Expenses
|
Estimated
Annual
Benefits
Upon Retirement
|
Total Compensation from Fund
Complex Paid to Trustees(1)
|
|
|
Name
of Independent Trustee
|
||||
|
Michael
D. LeRoy
|
$1,012
|
None
|
None
|
$1,012
|
|
Donald
E. O’Connor
|
$1,012
|
None
|
None
|
$1,012
|
|
George
J. Rebhan
|
$1,012
|
None
|
None
|
$1,012
|
|
George
T. Wofford
|
$1,012
|
None
|
None
|
$1,012
|
|
Aggregate
Compensation
from the Fund(1)
|
Pension
or Retirement Benefits Accrued as Part of Fund Expenses
|
Estimated
Annual
Benefits
Upon Retirement
|
Total Compensation from Fund
Complex Paid to Trustees(1)
|
|
|
Name
of Interested Trustee
|
||||
|
Joe
D. Redwine
|
$0
|
None
|
None
|
$0
|
|
(1)
|
There
are currently numerous portfolios comprising the Trust. The
term “Fund Complex” applies only to the Fund. For the fiscal year ending
September 30, 2010, Trustees’ fees are estimated in the amount of $132,000.
|
Control
Persons, Principal Shareholders, and Management Ownership
A
principal shareholder is any person who owns of record or beneficially 5% or
more of the outstanding shares of the Fund. A control person is one
who owns beneficially or through controlled companies more than 25% of the
voting securities of a company or acknowledges the existence of
control. Shareholders with a controlling interest could affect the
outcome of voting or the direction of management of the Fund.
Since the
Fund was not operational prior to the date of this SAI, there were no principal
shareholders or control persons and the Trustees and officers of the Trust as a
group did not own more than 1% of the Fund’s outstanding shares.
The Board
has adopted Proxy Voting Policies and Procedures (the “Policies”) on behalf of
the Trust which delegate the responsibility for voting proxies to the Adviser,
subject to the Board’s continuing oversight. The Policies require
that the Adviser vote proxies received in a manner consistent with the best
interests of the Fund and its shareholders. The Policies also require
the Adviser to present to the Board, at least annually, the Adviser’s Policies
and a record of each proxy voted by the Adviser on behalf of the Fund, including
a report on the resolution of all proxies identified by the Adviser as involving
a conflict of interest.
The
Adviser will vote proxies based on its view of what is best for the long-term
investors in the companies in question. The Adviser maintains written
policies and procedures regarding proxy voting and makes appropriate disclosures
about its proxy policy and practice. The policy and practice include
the responsibility to monitor corporate actions, receive and vote client
proxies, and disclose any potential conflicts of interest as well as information
available to clients about the voting of proxies for their portfolio securities
and maintaining relevant and required records.
Voting
Guidelines
The
Adviser will vote proxies in the firm’s view of the long term best interests of
the company’s shareholders, which, in the firm’s view, is in the best interest
of its clients. In the absence of specific voting guidelines from a
client, the Adviser’s policy is to vote all proxies from a specific issuer the
same way for all clients.
The Trust
is required to file a Form N-PX, with the Fund’s complete proxy voting record
for the 12 months ended June 30, no later than August 31 of each
year. The Fund’s proxy voting record will be available without
charge, upon request, by calling toll-free 1-[8__]-[___]-[____]
and on the SEC’s website at www.sec.gov.
Poplar
Forest Capital LLC acts as investment adviser to the Fund pursuant to an
investment advisory agreement (the “Advisory Agreement”) with the
Trust. Mr. J. Dale Harvey, the portfolio manager of the Fund, owns
89% of the Adviser and is therefore, a control person of the
Adviser.
In
consideration of the services to be provided by the Adviser pursuant to the
Advisory Agreement, the Adviser is entitled to receive from the Fund an
investment advisory fee computed daily and payable monthly, based on a rate
equal to 1.00% of the first $250 million of assets, 0.80% of the next $750
million of assets and 0.60% of assets in excess of $1 billion of the Fund’s
average daily net assets for each of the Class A shares and Institutional Class
shares.
After its
initial two year term, the Advisory Agreement continues in effect for successive
annual periods so long as such continuation is specifically approved at least
annually by the vote of (1) the Board (or a majority of the outstanding
shares of the Fund), and (2) a majority of the Trustees who are not
interested persons of any party to the Advisory Agreement, in each case, cast in
person at a meeting called for the purpose of voting on such
approval. The Advisory Agreement may be terminated at any time,
without penalty, by either party to the Advisory Agreement upon a 60-day written
notice and is automatically terminated in the event of its “assignment,” as
defined in the 1940 Act.
In
addition to the management fees payable to the Adviser, the Fund is responsible
for its own operating expenses, including: fees and expenses incurred in
connection with the issuance, registration and transfer of its shares; brokerage
and commission expenses; all expenses of transfer, receipt, safekeeping,
servicing and accounting for the cash, securities and other property of the
Trust for the benefit of the Fund including all fees and expenses of its
custodian and accounting services agent; interest charges on any borrowings;
costs and expenses of pricing and calculating its daily NAV per share and of
maintaining its books of account required under the 1940 Act; taxes, if any; a
pro rata portion of expenditures in connection with meetings of the Fund’s
shareholders and the Trust’s Board that are properly payable by the Fund;
salaries and expenses of officers and fees and expenses of members of the Board
or members of any advisory board or committee who are not members of, affiliated
with or interested persons of the Adviser or Administrator; insurance premiums
on property or personnel of the Fund which inure to their benefit, including
liability and fidelity bond insurance; the cost of preparing and printing
reports, proxy statements, prospectuses and the statement of additional
information of the Fund or other communications for distribution to existing
shareholders; legal counsel, auditing and accounting fees; trade association
membership dues (including membership dues in the Investment Company Institute
allocable to the Fund); fees and expenses (including legal fees) of registering
and maintaining registration of its shares for sale under federal and applicable
state and foreign securities laws; all expenses of maintaining shareholder
accounts, including all charges for transfer, shareholder recordkeeping,
dividend disbursing, redemption, and other agents for the benefit of the Fund,
if any; and all other charges and costs of its operation plus any extraordinary
and non-recurring expenses, except as otherwise prescribed in the Advisory
Agreement.
Though
the Fund is responsible for its own operating expenses, the Adviser has
contractually agreed to waive a portion or all of the management fees payable to
it by the Fund and/or to pay Fund operating expenses to the extent necessary to
limit the Fund’s aggregate annual operating expenses (excluding acquired fund
fees and expenses, interest, taxes and extraordinary expenses) to the limits set
forth in the Annual Fund Operating Expenses table of the
Prospectus. Any such waivers made by the Adviser in its management
fees or payment of expenses which are the Fund’s obligation are subject to
recoupment by the Adviser from the Fund, if so requested by the Adviser, in
subsequent fiscal years if the aggregate amount actually paid by the Fund toward
the operating expenses for such fiscal year (taking into account the recoupment)
does not exceed the applicable limitation on Fund expenses. The
Adviser is permitted to recoup only for management fee waivers and expense
payments made in the previous three fiscal years. Any such recoupment
is also contingent upon the Board’s subsequent review and ratification of the
recouped amounts. Such recoupment may not be paid prior to the Fund’s
payment of current ordinary operating expenses.
Portfolio
Manager
Mr. J.
Dale Harvey is the portfolio manager principally responsible for the day-to-day
management of the Fund’s portfolio. The following table shows the
number of other accounts managed by Mr. Harvey and the total assets in the
accounts managed within various categories as of October
31, 2009.
|
Type
of Accounts
|
Number
of Accounts
|
Total
Assets
|
Number
of Accounts with Advisory Fee based on Performance
|
Total
Assets
|
|
Registered
Investment Companies
|
0
|
$0
|
0
|
$0
|
|
Other
Pooled Investments
|
||||
|
Other
Accounts
|
||||
Material Conflicts of
Interest. Mr. Harvey also manages all investment accounts for
the Adviser, including Poplar Forest Fund LP, Poplar Forest Partners LP and any
major separate account. There is a potential conflict should one of
these funds/accounts be favored over another, but the intention of the Adviser
is to treat the various funds equally. The various funds are expected
to hold generally the same securities in the same proportions. Buy
and/or sell orders will normally be placed concurrently for each
fund. Any differences between the funds/accounts would be expected to
arise from differential cash flows.
Compensation. Mr.
Harvey receives a fixed base salary and a share of the profits of the Adviser
equal in proportion to his ownership of the firm.
Fund
Administrator, Transfer Agent and Fund Accountant
Pursuant
to an administration agreement (the “Administration Agreement”), U.S. Bancorp
Fund Services, LLC, (“USBFS”) 615 East Michigan Street, Milwaukee, Wisconsin
53202, acts as the Administrator to the Fund. USBFS provides certain
services to the Fund including, among other responsibilities, coordinating the
negotiation of contracts and fees with, and the monitoring of performance and
billing of, the Fund’s independent contractors and agents; preparation for
signature by an officer of the Trust of all documents required to be filed for
compliance by the Trust and the Fund with applicable laws and regulations,
excluding those of the securities laws of various states; arranging for the
computation of performance data, including NAV per share and yield; responding
to shareholder inquiries; and arranging for the maintenance of books and records
of the Fund, and providing, at its own expense, office facilities, equipment and
personnel necessary to carry out its duties. In this capacity, USBFS
does not have any responsibility or authority for the management of the Fund,
the determination of investment policy, or for any matter pertaining to the
distribution of Fund shares.
Pursuant
to the Administration Agreement, as compensation for its services, USBFS
receives from the Fund, a fee based on the Fund’s current average daily net
assets of: 0.12% on the first $50 million, 0.08% on the next $250 million and
0.05% on the remaining assets, with a minimum annual fee of
$35,000. USBFS also is entitled to certain out-of-pocket
expenses. USBFS also acts as fund accountant, transfer agent (the
“Transfer Agent”) and dividend disbursing agent under separate
agreements. Additionally, the Administrator provides Chief Compliance
Officer services to the Trust under a separate agreement. The cost of
the Chief Compliance Officer services is allocated to the Fund by the
Board.
Custodian
Pursuant
to a Custody Agreement between the Trust and U.S. Bank National Association,
located at 1555 North River Center Drive, Suite 302, Milwaukee, Wisconsin 53212
(the “Custodian”), the Custodian serves as the custodian of the Fund’s assets,
holds the Fund’s portfolio securities in safekeeping, and keeps all necessary
records and documents relating to its duties. The Custodian is
compensated with an asset-based fee plus transaction fees and is reimbursed for
out-of-pocket expenses.
The
Custodian and Administrator do not participate in decisions relating to the
purchase and sale of securities by the Fund. The Administrator,
Transfer Agent, Custodian and the Fund’s Distributor (as defined below) are
affiliated entities under the common control of U.S.
Bancorp. The Custodian and its affiliates may participate in
revenue sharing arrangements with the service providers of mutual funds in which
the Fund may invest.
Independent
Registered Pubic Accounting Firm and Legal Counsel
[_______________________________________________________],
is the independent registered public accounting firm for the Fund, whose
services include auditing the Fund’s financial statements and the performance of
related tax services.
Paul,
Hastings, Janofsky & Walker LLP (“Paul Hastings”), 75 East 55th Street, New
York, New York 10022, serves as legal counsel to the Trust. Paul
Hastings also serves as independent legal counsel to the Board of
Trustees.
Pursuant
to the Advisory Agreement, the Adviser determines which securities are to be
purchased and sold by the Fund and which broker-dealers are eligible to execute
the Fund’s portfolio transactions. Purchases and sales of securities
in the over-the-counter market will generally be executed directly with a
“market-maker” unless, in the opinion of the Adviser, a better price and
execution can otherwise be obtained by using a broker for the
transaction.
Purchases
of portfolio securities for the Fund also may be made directly from issuers or
from underwriters. Where possible, purchase and sale transactions
will be effected through dealers (including banks) which specialize in the types
of securities which the Fund will be holding, unless better executions are
available elsewhere. Dealers and underwriters usually act as
principal for their own accounts. Purchases from underwriters will
include a concession paid by the issuer to the underwriter and purchases from
dealers will include the spread between the bid and the asked
price. If the execution and price offered by more than one dealer or
underwriter are comparable, the order may be allocated to a dealer or
underwriter that has provided research or other services as discussed
below.
In
placing portfolio transactions, the Adviser will seek best
execution. The full range and quality of services available will be
considered in making these determinations, such as the size of the order, the
difficulty of execution, the operational facilities of the firm involved, the
firm’s risk in positioning a block of securities and other
factors. In those instances where it is reasonably determined that
more than one broker-dealer can offer the services needed to obtain the most
favorable price and execution available, consideration may be given to those
broker-dealers which furnish or supply research and statistical information to
the Adviser that it may lawfully and appropriately use in its investment
advisory capacities, as well as provide other services in addition to execution
services. The Adviser considers such information, which is in
addition to and not in lieu of the services required to be performed by it under
its Agreement with the Fund, to be useful in varying degrees, but of
indeterminable value. Portfolio transactions may be placed with
broker-dealers who sell shares of the Fund subject to rules adopted by the
Financial Industry Regulatory Authority, Inc. (“FINRA”) and the
SEC.
While it
is the Fund’s general policy to first seek to obtain the most favorable price
and execution available in selecting a broker-dealer to execute portfolio
transactions for the Fund, in accordance with Section 28(e) under the Securities
and Exchange Act of 1934, when it is determined that more than one broker can
deliver best execution, weight is also given to the ability of a broker-dealer
to furnish brokerage and research services to the Fund or to the Adviser, even
if the specific services are not directly useful to the Fund and may be useful
to the Adviser in advising other clients. In negotiating commissions
with a broker or evaluating the spread to be paid to a dealer, the Fund may
therefore pay a higher commission or spread than would be the case if no weight
were given to the furnishing of these supplemental services, provided that the
amount of such commission or spread has been determined in good faith by the
Adviser to be reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer.
Investment
decisions for the Fund are made independently from those of other client
accounts or mutual funds managed or advised by the
Adviser. Nevertheless, it is possible that at times identical
securities will be acceptable for both the Fund and one or more of such client
accounts or mutual funds. In such event, the position of the Fund and
such client account(s) or mutual funds in the same issuer may vary and the
length of time that each may choose to hold its investment in the same issuer
may likewise vary. However, to the extent any of these client
accounts or mutual funds seek to acquire the same security as the Fund at the
same time, the Fund may not be able to acquire as large a portion of such
security as it desires, or it may have to pay a higher price or obtain a lower
yield for such security. Similarly, the Fund may not be able to
obtain as high a price for, or as large an execution of, an order to sell any
particular security at the same time. If one or more of such client
accounts or mutual funds simultaneously purchases or sells the same security
that the Fund is purchasing or selling, each day’s transactions in such security
will be allocated between the Fund and all such client accounts or mutual funds
in a manner deemed equitable by the Adviser, taking into account the respective
sizes of the accounts and the amount of cash available for investment, the
investment objective of the account, and the ease with which a clients
appropriate amount can be bought, as well as the liquidity and volatility of the
account and the urgency involved in making an investment decision for the
client. It is recognized that in some cases this system could have a
detrimental effect on the price or value of the security insofar as the Fund is
concerned. In other cases, however, it is believed that the ability
of the Fund to participate in volume transactions may produce better executions
for the Fund.
The Trust
has entered into a Distribution Agreement (the “Distribution Agreement”) with
Quasar Distributors, LLC, 615 East Michigan Street, Milwaukee, Wisconsin 53202
(the “Distributor”), pursuant to which the Distributor acts as the Fund’s
distributor, provides certain administration services and promotes and arranges
for the sale of Fund shares. The offering of the Fund’s shares is
continuous. The Distributor, USBFS, and Custodian are all affiliated
companies. The Distributor is a registered broker-dealer and member
of FINRA.
The
Distribution Agreement has an initial term of up to two years and will continue
in effect only if such continuance is specifically approved at least annually by
the Board or by vote of a majority of the Fund’s outstanding voting securities
and, in either case, by a majority of the Trustees who are not parties to the
Distribution Agreement or “interested persons” (as defined in the 1940 Act) of
any such party. The Distribution Agreement is terminable without
penalty by the Trust on behalf of the Fund on 60 days written notice when
authorized either by a majority vote of the Fund’s shareholders or by vote of a
majority of the Board, including a majority of the Trustees who are not
“interested persons” (as defined in the 1940 Act) of the Trust, or by the
Distributor on 60 days written notice, and will automatically terminate in the
event of its “assignment” (as defined in the 1940 Act).
RULE
12b-1 DISTRIBUTION AND SERVICE PLAN
The Fund
has adopted a Distribution and Service Plan (the “Plan”) pursuant to Rule 12b-1
under the 1940 Act under which the Class A shares of the Fund pay the
Distributor an amount which is accrued daily and paid quarterly, at an annual
rate of 0.25% of the average daily net assets of the Fund’s Class A
shares. The Plan provides that the Distributor may use all or any
portion of such fee to finance any activity that is principally intended to
result in the sale of Fund shares, subject to the terms of the Plan, or to
provide certain shareholder services. Amounts paid under the Plan, by
the Fund, are paid to the Distributor to reimburse it for costs of the services
it provides and the expenses it bears in the distribution of the Fund’s Class A
shares, including overhead and telephone expenses; printing and distribution of
prospectuses and reports used in connection with the offering of the Fund’s
shares to prospective investors; and preparation, printing and distribution of
sales literature and advertising materials. In addition, payments to
the Distributor under the Plan reimburse the Distributor for payments it makes
to selected dealers and administrators which have entered into Service
Agreements with the Distributor for services provided to shareholders of the
Fund. The services provided by selected dealers pursuant to the Plan
are primarily designed to promote the sale of shares of the Fund and include the
furnishing of office space and equipment, telephone facilities, personnel and
assistance to the Fund in servicing such shareholders. The services
provided by the administrators pursuant to the Plan are designed to provide
support services to the Fund and include establishing and maintaining
shareholders’ accounts and records, processing purchase and redemption
transactions, answering routine client inquiries regarding the Fund and
providing other services to the Fund as may be required.
Under the
Plan, the Trustees are furnished quarterly with information detailing the amount
of expenses paid under the Plan and the purposes for which payments were
made. The Plan may be terminated at any time by vote of a majority of
the Trustees of the Trust who are not interested
persons. Continuation of the Plan is considered by such Trustees no
less frequently than annually. With the exception of the Distributor
in its capacity as the Fund’s principal underwriter, no interested person has or
had a direct or indirect financial interest in the Plan or any related
agreement.
While
there is no assurance that the expenditures of Fund assets to finance the
distribution of shares will have the anticipated results, the Board believes
there is a reasonable likelihood that one or more of such benefits will result,
and because the Board is in a position to monitor the distribution expenses, it
is able to determine the benefit of such expenditures in deciding whether to
continue the Plan.
The
Trust, the Adviser and the Distributor, as defined below, have each adopted
separate Codes of Ethics under Rule 17j-1 of the 1940 Act. These
Codes permit, subject to certain conditions, access persons of the Adviser and
Distributor to invest in securities that may be purchased or held by the
Fund.
The
Adviser and the Fund maintain portfolio holdings disclosure policies that govern
the timing and circumstances of disclosure to shareholders and third parties of
information regarding the portfolio investments held by the
Fund. These portfolio holdings disclosure policies have been approved
by the Board. Disclosure of the Fund’s complete holdings is required
to be made quarterly within 60 days of the end of each fiscal quarter in the
Annual Report and Semi-Annual Report to Fund shareholders and in the quarterly
holdings report on Form N-Q. These reports are available, free of
charge, on the EDGAR database on the SEC’s website at www.sec.gov.
Pursuant
to the Trust’s portfolio holdings disclosure policies, information about the
Fund’s portfolio holdings is not distributed to any person unless:
|
|
§
|
The
disclosure is required pursuant to a regulatory request, court order or is
legally required in the context of other legal
proceedings;
|
|
|
§
|
The
disclosure is made to a mutual fund rating and/or ranking organization, or
person performing similar functions, who is subject to a duty of
confidentiality, including a duty not to trade on any non-public
information;
|
|
|
§
|
The
disclosure is made to internal parties involved in the investment process,
administration, operation or custody of the Fund, including, but not
limited to USBFS and the Trust’s Board of Trustees, attorneys, auditors or
accountants;
|
|
|
§
|
The
disclosure is made: (a) in connection with a quarterly, semi-annual or
annual report that is available to the public; or (b) relates to
information that is otherwise available to the public;
or
|
|
|
§
|
The
disclosure is made with the prior written approval of either the Trust’s
Chief Compliance Officer or his or her
designee.
|
Certain
of the persons listed above receive information about the Fund’s portfolio
holdings on an ongoing basis. The Fund believes that these third
parties have legitimate objectives in requesting such portfolio holdings
information and operate in the best interest of the Fund’s shareholders. These
persons include:
|
|
§
|
A
mutual fund rating and/or ranking organization, or person performing
similar functions, who is subject to a duty of confidentiality, including
a duty not to trade on any non-public
information;
|
|
|
§
|
Rating
and/or ranking organizations, specifically: Lipper; Morningstar; Standard
& Poor’s; Bloomberg; Vickers-Stock Research Corporation; Thomson
Financial; and Capital-Bridge, all of which currently receive such
information between the fifth and tenth business day of the month
following the end of a calendar quarter;
or
|
|
|
§
|
Internal
parties involved in the investment process, administration, operation or
custody of the Fund, specifically: USBFS; the Trust’s Board of Trustees;
and the Trust’s attorneys and accountants (currently, Paul Hastings and
[_____________],
respectively), all of which typically receive such information after it is
generated.
|
Any
disclosures to additional parties not described above is made with the prior
written approval of either the Trust’s Chief Compliance Officer or his or her
designee, pursuant to the Trust’s Policy and Procedures Regarding Disclosure of
Portfolio Holdings.
The Chief
Compliance Officer or designated officer of the Trust will approve the
furnishing of non-public portfolio holdings to a third party only if they
consider the furnishing of such information to be in the best interest of the
Fund and its shareholders and if no material conflict of interest exists
regarding such disclosure between shareholders interest and those of the
Adviser, Distributor or any affiliated person of the Fund. No
consideration may be received by the Fund, the Adviser, any affiliate of the
Adviser or their employees in connection with the disclosure of portfolio
holdings information. The Board receives and reviews annually a list
of the persons who receive non-public portfolio holdings information and the
purpose for which it is furnished.
The NAV
of the Fund is determined as of the close of regular trading on the New York
Stock Exchange (the “NYSE”) (generally 4:00 p.m., Eastern time), each day the
NYSE is open for trading. The NYSE annually announces the days on
which it will not be open for trading. It is expected that the NYSE
will not be open for trading on the following holidays: New Year’s
Day, Martin Luther King, Jr. Day, Washington’s Birthday/Presidents’ Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.
NAV is
calculated by adding the value of all securities and other assets attributable
to the Fund (including interest and dividends accrued, but not yet received),
then subtracting liabilities attributable to the Fund (including accrued
expenses). The net asset amount attributable to the Class A shares
and Institutional Class shares is divided by the number of shares held by
investors of the applicable class.
Generally,
the Fund’s investments are valued at market value or, in the absence of a market
value, at fair value as determined in good faith by the Trust’s Valuation
Committee pursuant to procedures approved by or under the direction of the
Board. Pursuant to those procedures, the Valuation Committee
considers, among other things: (1) the last sales price on the
securities exchange, if any, on which a security is primarily traded; (2) the
mean between the bid and asked prices; (3) price quotations from an approved
pricing service; and (4) other factors as necessary to determine a fair value
under certain circumstances.
Securities
primarily traded in the NASDAQ Global Market® for
which market quotations are readily available shall be valued using the
NASDAQ®
Official Closing Price (“NOCP”). If the NOCP is not available, such
securities shall be valued at the last sale price on the day of valuation, or if
there has been no sale on such day, at the mean between the bid and asked
prices. OTC securities which are not traded in the NASDAQ Global
Market® shall
be valued at the most recent trade price. Securities and assets for
which market quotations are not readily available (including restricted
securities which are subject to limitations as to their sale) are valued at fair
value as determined in good faith under procedures approved by or under the
direction of the Board.
Short-term
debt obligations with remaining maturities in excess of 60 days are valued at
current market prices, as discussed above. In order to reflect their
fair value, short-term securities with 60 days or less remaining to maturity
are, unless conditions indicate otherwise, amortized to maturity based on their
cost to the Fund if acquired within 60 days of maturity or, if already held by
the Fund on the 60th day, based on the value determined on the 61st
day.
The
Fund’s securities, including ADRs, EDRs and GDRs, which are traded on securities
exchanges are valued at the last sale price on the exchange on which such
securities are traded, as of the close of business on the day the securities are
being valued or, lacking any reported sales, at the mean between the last
available bid and asked price. Securities that are traded on more
than one exchange are valued on the exchange determined by the Adviser to be the
primary market.
In the
case of foreign securities, the occurrence of certain events after the close of
foreign markets, but prior to the time the Fund’s NAV is calculated (such as a
significant surge or decline in the U.S. or other markets) often will result in
an adjustment to the trading prices of foreign securities when foreign markets
open on the following business day. If such events occur, the Fund
will value foreign securities at fair value, taking into account such events, in
calculating the NAV. In such cases, use of fair valuation can reduce
an investor’s ability to seek to profit by estimating the Fund’s NAV in advance
of the time the NAV is calculated. The Adviser anticipates that the
Fund’s portfolio holdings will be fair valued only if market quotations for
those holdings are considered unreliable or are unavailable.
An option
that is written or purchased by the Fund shall be valued using composite pricing
via the National Best Bid and Offer quotes. Composite pricing looks
at the last trade on the exchange where the option is traded. If
there are no trades for an option on a given business day, as of closing, the
Fund will value the option at the mean of the highest bid price and lowest ask
price across the exchanges where the option is traded. For options
where market quotations are not readily available, fair value shall be
determined by the Trust’s Valuation Committee.
All other
assets of the Fund are valued in such manner as the Board in good faith deems
appropriate to reflect their fair value.
The
information provided below supplements the information contained in the
Prospectus regarding the purchase and redemption of Fund shares.
How
to Buy Shares
You may
purchase shares of the Fund from securities brokers, dealers or financial
intermediaries (collectively, “Financial Intermediaries”). Investors should
contact their Financial Intermediary directly for appropriate instructions, as
well as information pertaining to accounts and any service or transaction fees
that may be charged. The Fund may enter into arrangements with
certain Financial Intermediaries whereby such Financial Intermediaries are
authorized to accept your order on behalf of the Fund. If you
transmit your order to these Financial Intermediaries before the close of
regular trading (generally 4:00 p.m., Eastern time) on a day that the NYSE is
open for business, shares will be purchased at the appropriate per share price
next computed after it is received by the Financial
Intermediary. Investors should check with their Financial
Intermediary to determine if it participates in these arrangements.
The
public offering price of Fund shares is the NAV per share plus any applicable
sales charge (load). Shares are purchased at the public offering
price next determined after the Transfer Agent receives your order in good
order. In most cases, in order to receive that day’s public offering
price, the Transfer Agent must receive your order in good order before the close
of regular trading on the New York Stock Exchange (“NYSE”), normally
4:00 p.m., Eastern time.
The Trust
reserves the right in its sole discretion (i) to suspend the continued
offering of the Fund’s shares, (ii) to reject purchase orders in whole or
in part when in the judgment of the Adviser or the Distributor such rejection is
in the best interest of the Fund, and (iii) to reduce or waive the minimum
for initial and subsequent investments for certain fiduciary accounts or under
circumstances where certain economies can be achieved in sales of the Fund’s
shares.
In
addition to cash purchases, Fund shares may be purchased by tendering payment
in-kind in the form of shares of stock, bonds or other
securities. Any securities used to buy Fund shares must be readily
marketable, their acquisition consistent with the Fund’s objective and otherwise
acceptable to the Adviser and the Board.
How
to Sell Shares and Delivery of Redemption Proceeds
You can
sell your Fund shares any day the NYSE is open for regular trading, either
directly to the Fund or through your Financial Intermediary.
Payments
to shareholders for shares of the Fund redeemed directly from the Fund will be
made as promptly as possible, but no later than seven days after receipt by the
Transfer Agent of the written request in proper form, with the appropriate
documentation as stated in the Prospectus, except that the Fund may suspend the
right of redemption or postpone the date of payment during any period when
(a) trading on the NYSE is restricted as determined by the SEC or the NYSE
is closed for other than weekends and holidays; (b) an emergency exists as
determined by the SEC making disposal of portfolio securities or valuation of
net assets of the Fund not reasonably practicable; or (c) for such other
period as the SEC may permit for the protection of the Fund’s
shareholders. Under unusual circumstances, the Fund may suspend
redemptions, or postpone payment for more than seven days, but only as
authorized by SEC rules.
The value
of shares on redemption or repurchase may be more or less than the investor’s
cost, depending upon the market value of the Fund’s portfolio securities at the
time of redemption or repurchase.
Telephone
Redemptions
Shareholders
with telephone transaction privileges established on their account may redeem
Fund shares by telephone. Upon receipt of any instructions or
inquiries by telephone from the shareholder, the Fund or its authorized agents
may carry out the instructions and/or respond to the inquiry consistent with the
shareholder’s previously established account service options. For
joint accounts, instructions or inquiries from either party will be carried out
without prior notice to the other account owners. In acting upon
telephone instructions, the Fund and its agents use procedures that are
reasonably designed to ensure that such instructions are
genuine. These include recording all telephone calls, requiring
pertinent information about the account and sending written confirmation of each
transaction to the registered owner.
USBFS
will employ reasonable procedures to confirm that instructions communicated by
telephone are genuine. If USBFS fails to employ reasonable
procedures, the Fund and USBFS may be liable for any losses due to unauthorized
or fraudulent instructions. If these procedures are followed,
however, to the extent permitted by applicable law, neither the Fund nor its
agents will be liable for any loss, liability, cost or expense arising out of
any redemption request, including any fraudulent or unauthorized
request. For additional information, contact USBFS.
Redemptions
In-Kind
The Trust
has filed an election under SEC Rule 18f-1 committing to pay in cash all
redemptions by a shareholder of record up to amounts specified by the rule (in
excess of the lesser of (i) $250,000 or (ii) 1% of the Fund’s
assets). The Fund has reserved the right to pay the redemption price
of its shares in excess of the amounts specified by the rule, either totally or
partially, by a distribution in-kind of portfolio securities (instead of
cash). The securities so distributed would be valued at the same
amount as that assigned to them in calculating the NAV per share for the shares
being sold. If a shareholder receives a distribution in-kind, the
shareholder could incur brokerage or other charges in converting the securities
to cash.
The Fund
does not intend to hold any significant percentage of its portfolio in illiquid
securities, although the Fund, like virtually all mutual funds, may from time to
time hold a small percentage of securities that are illiquid. In the
unlikely event the Fund were to elect to make an in-kind redemption, the Fund
expects that it would follow the normal protocol of making such distribution by
way of a pro rata distribution based on its entire portfolio. If the Fund held
illiquid securities, such distribution may contain a pro rata portion of such
illiquid securities or the Fund may determine, based on a materiality
assessment, not to include illiquid securities in the in-kind redemption. The
Fund does not anticipate that it would ever selectively distribute a greater
than pro rata portion of any illiquid securities to satisfy a redemption
request. If such securities are included in the distribution, shareholders may
not be able to liquidate such securities and may be required to hold such
securities indefinitely. Shareholders’ ability to liquidate such securities
distributed in-kind may be restricted by resale limitations or substantial
restrictions on transfer imposed by the issuers of the securities or by law.
Shareholders may only be able to liquidate such securities distributed in-kind
at a substantial discount from their value, and there may be higher brokerage
costs associated with any subsequent disposition of these securities by the
recipient.
Sales
Charges and Dealer Reallowance
Class A
shares of the Fund are retail shares that require that you pay a sales charge
when you invest unless you qualify for a reduction or waiver of the sales
charge. Class A shares are also subject to Rule 12b-1 fees (or
distribution and service fees) of up to 0.25% of average daily net assets that
are assessed against the shares of the Fund.
If you
purchase Class A shares of the Fund you will pay the NAV next determined after
your order is received plus a sales charge (shown in percentages below)
depending on the amount of your investment. The sales charge does not
apply to shares purchased with reinvested dividends. The sales charge
is calculated as follows and the dealer reallowance is as shown in the far right
column:
|
Investment
Amount
|
Sales Charge
as
a
% of
Offering Price(1)
|
Sales
Charge as
%
of Net
Amount
Invested
|
Dealer
Reallowance
|
|
$25,000
to $49,999
|
5.00%
|
5.26%
|
4.50%
|
|
$50,000
to $99,999
|
4.50%
|
4.71%
|
4.00%
|
|
$100,000
to $249,999
|
3.50%
|
3.63%
|
3.00%
|
|
$250,000
to $499,999
|
2.50%
|
2.56%
|
2.00%
|
|
$500,000
to $749,999
|
2.00%
|
2.04%
|
1.50%
|
|
$750,000
to $999,999
|
1.50%
|
1.52%
|
1.00%
|
|
$1,000,000
or more (see below)(2)
|
0.00%
|
0.00%
|
0.75%
|
|
(1)
|
Offering
price includes the front-end sales load. The sales charge you
pay may differ slightly from the amount set forth above because of
rounding that occurs in the calculation used to determine your sales
charge.
|
|
(2)
|
Class
A shares that are purchased at NAV in amounts of $1,000,000 or more may be
assessed a 0.75% CDSC if they are redeemed within twelve months from the
date of purchase. See “More about Class A Shares” in the
statutory Prospectus for further
information.
|
Breakpoints/Volume
Discounts and Sales Charge Waivers
Reducing Your Sales
Charge. You may be able to reduce the sales charge on Class A
shares of the Fund based on the combined market value of your
accounts. If you believe you are eligible for any of the following
reductions or waivers, it is up to you to ask the selling agent or shareholder
servicing agent for the reduction and to provide appropriate proof of
eligibility.
|
•
|
You
pay no sales charges on Fund shares you buy with reinvested
distributions.
|
|
•
|
You
pay a lower sales charge if you are investing an amount over a specific
breakpoint level as indicated by the above
table.
|
|
•
|
You
pay no sales charges on Fund shares you purchase with the proceeds of a
redemption of Class A shares within 120 days of the date of the
redemption.
|
|
•
|
By
signing a Letter of Intent (LOI) prior to purchase, you pay a lower sales
charge now in exchange for promising to invest an amount over a specified
breakpoint within the next 13 months. Reinvested dividends and
capital gains do not count as purchases made during this
period. The Transfer Agent will hold in escrow shares equal to
approximately 5% of the amount you say you intend to buy. If
you do not invest the amount specified in the LOI before the expiration
date, the Transfer Agent will redeem enough escrowed shares to pay the
difference between the reduced sales load you paid and the sales load you
should have paid. Otherwise, the Transfer Agent will release
the escrowed shares when you have invested the agreed
amount. For example, an investor has $25,000 to invest in the
Fund, but intends to invest an additional $2,000 per month for the next 13
months for a total of $51,000. Based on the above breakpoint
schedule, by signing the LOI, the investor pays a front-end load of 4.50%
rather than 5.00%. If the investor fails to meet the intended
LOI amount in the 13-month period, however, the Fund will charge the
higher sales load retroactively.
|
|
•
|
Rights
of Accumulation (“ROA”) allow you to combine Class A shares you already
own in order to reach breakpoint levels and to qualify for sales load
discounts on subsequent purchases of Class A shares. The
purchase amount used in determining the sales charge on your purchase will
be calculated by multiplying the maximum public offering price by the
number of Class A shares of the Fund already owned and adding the dollar
amount of your current purchase. For example, an individual has
a $55,000 investment in the Fund, which was sold with a 4.50% front-end
load. The investor intends to open a second account and
purchase $50,000 of the Fund. Using ROA, the new $50,000
investment is combined with the existing $55,000 investment to reach the
$100,000 breakpoint, and the sales charge on the new investment is 3.50%
(rather than the 4.50% for a single transaction
amount).
|
Eligible
Accounts. Certain accounts may be aggregated for ROA
eligibility, including your current investment in the Fund, and previous
investments you and members of your primary household group have made in the
Fund, provided your investment was subject to a sales charge. (Your
primary household group consists of you, your spouse and children under age 21
living at home.) Specifically, the following accounts are eligible to
be included in determining the sales charge on your purchase, if a sales charge
has been paid on those purchases:
|
•
|
Individual
or joint accounts held in your
name;
|
|
•
|
Trust
accounts for which you or a member of your primary household group,
individually, is the beneficiary;
and
|
|
•
|
Accounts
held in the name of you or your spouse’s sole proprietorship or single
owner limited liability company or S
corporation;
|
The
following accounts are not eligible to be included in determining ROA
eligibility;
|
•
|
Investments
in Class A shares where the sales charge was
waived.
|
Waiving Your Sales
Charge. The Fund’s Adviser reserves the right to waive the
sales charges for certain groups or classes of shareholders. If you
fall into any of the following categories, you can buy Class A shares at NAV per
share without a sales charge:
|
•
|
Current
and retired employees, directors/trustees and officers
of:
|
|
|
i.
|
The
Trust; and
|
|
|
ii.
|
The
Adviser and its affiliates;
|
|
•
|
Family
members (spouse, domestic partner, parents, grandparents, children,
grandchildren and siblings (including step and in-law)) of (i)-(ii):
and
|
|
•
|
Any
trust, pension, profit sharing or other benefit plan for current
employees, directors/trustees and officers of the Adviser and its
affiliates;
|
|
•
|
Current
employees of:
|
|
|
i.
|
The
Transfer Agent;
|
|
|
ii.
|
broker-dealers
who act as selling agents for the
Fund/Trust;
|
|
•
|
family
members (spouse, domestic partner, parents, grandparents, children,
grandchildren and siblings (including step and in-law)) of (i)-(ii);
and
|
|
•
|
Qualified
registered investment advisers who buy through a broker-dealer or service
agent who has entered into an agreement with the Distributor that allows
for load-waived Class A shares
purchases.
|
For
calendar year 2010, the Fund will waive the Class A sales charges for the
reinvestment of $100,000 or more of proceeds from the sale of shares of another
equity mutual fund where those shares were subject to a front-end sales charge
(sometimes referred to as an NAV transfer). In order to be eligible
for this waiver, proceeds from the sale of shares of another fund must be
reinvested in the Fund within 30 days and documentation satisfactory to the
Fund, must be provided evidencing your eligibility for this
waiver. The Fund also reserves the right to enter into
agreements that reduce or eliminate sales charges for other groups or classes of
shareholders, including for Fund shares included in other investment plans such
as “wrap accounts.” If you own Fund shares as part of another account
or package, such as an IRA or a sweep account, you should read the terms and
conditions that apply for that account. Those terms and conditions
may supersede the terms and conditions discussed here. Contact your
selling agent for further information.
Distributions
Dividends
from net investment income and distributions from net profits from the sale of
securities are generally made annually. Also, the Fund typically
distributes any undistributed net investment income on or about December 31 of
each year. Any net capital gains realized through the period ended
October 31 of each year will also be distributed by December 31 of each
year.
Each
distribution by the Fund is accompanied by a brief explanation of the form and
character of the distribution. In January of each year, the Fund will
issue to each shareholder a statement of the federal income tax status of all
distributions.
Tax
Information
Each
series of the Trust is treated as a separate entity for federal income tax
purposes. The Fund, as a series of the Trust, intends to qualify and
elects to be treated as a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended (the “Code”), provided it complies
with all applicable requirements regarding the source of its income,
diversification of its assets and timing and amount of
distributions. The Fund’s policy is to distribute to its shareholders
all of its investment company taxable income and any net realized long term
capital gains for each fiscal year in a manner that complies with the
distribution requirements of the Code, so that the Fund will not be subject to
any federal income or excise taxes. However, the Fund can give no
assurances that distributions will be sufficient to eliminate all
taxes. To avoid the excise tax, the Fund must also distribute (or be
deemed to have distributed) by December 31 of each calendar year (i) at least
98% of its ordinary income for such year, (ii) at least 98% of the excess of its
realized capital gains over its realized capital losses for the 12 month period
ending on October 31 during such year, and (iii) any amounts from the prior
calendar year that were not distributed and on which no federal income tax was
paid by the Fund or shareholders.
Net
investment income generally consists of interest and dividend income, less
expenses. Net realized capital gains for a fiscal period are computed
by taking into account any capital loss carryforward of the Fund.
Distributions
of net investment income and net short term capital gains are taxable to
shareholders as ordinary income. For individual shareholders, a
portion of the distributions paid by the Fund may be qualified dividend income
currently eligible for taxation at long-term capital gain rates to the extent
the Fund designates the amount distributed as a qualifying dividend and certain
holding period requirements are met. In the case of corporate
shareholders, a portion of the distributions may qualify for the intercorporate
dividends-received deduction to the extent the Fund designates the amount
distributed as a qualifying dividend. The aggregate amount so
designated to either individual or corporate shareholders cannot, however,
exceed the aggregate amount of qualifying dividends received by the Fund for its
taxable year. In view of the Fund’s investment policies, it is
expected that dividends from domestic corporations will be part of the Fund’s
gross income and that, accordingly, part of the distributions by the Fund may be
eligible for qualified dividend income treatment for individual shareholders, or
for the dividends-received deduction for corporate
shareholders. However, the portion of the Fund’s gross income
attributable to qualifying dividends is largely dependent on the Fund’s
investment activities for a particular year and therefore cannot be predicted
with any certainty. Further, the dividends-received deduction may be
reduced or eliminated if Fund shares held by a corporate investor are treated as
debt financed or are held for less than 46 days.
Any
long-term capital gain distributions are taxable to shareholders as long-term
capital gains regardless of the length of time shares have been
held. Capital gains distributions are not eligible for qualified
dividend income treatment or the dividends received deduction referred to in the
previous paragraph. Distributions of any net investment income and
net realized capital gains will be taxable as described above, whether received
in shares or in cash. Shareholders who choose to receive
distributions in the form of additional shares will have a cost basis for
federal income tax purposes in each share so received equal to the net asset
value of a share on the reinvestment date. Distributions are
generally taxable when received or deemed to be received. However,
distributions declared in October, November or December to shareholders of
record on a date in such a month and paid the following January are taxable as
if received on December 31. Distributions are includable in
alternative minimum taxable income in computing a shareholder’s liability for
the alternative minimum tax.
The Fund
may be subject to foreign withholding taxes on dividends and interest earned
with respect to securities of foreign corporations.
Redemption
of Fund shares may result in recognition of a taxable gain or
loss. Any loss realized upon redemption of shares within six months
from the date of their purchase will be treated as a long term capital loss to
the extent of any amounts treated as distributions of long term capital gains
during such six month period. Any loss realized upon a redemption may
be disallowed under certain wash sale rules to the extent shares of the Fund are
purchased (through reinvestment of distributions or otherwise) within 30 days
before or after the redemption.
Under the
Code, the Fund will be required to report to the Internal Revenue Service all
distributions of taxable income and capital gains as well as gross proceeds from
the redemption of Fund shares, except in the case of exempt shareholders, which
includes most corporations. Pursuant to the backup withholding
provisions of the Code, distributions of any taxable income and capital gains
and proceeds from the redemption of Fund shares may be subject to withholding of
federal income tax in the case of non-exempt shareholders who fail to furnish
the Fund with their taxpayer identification numbers and with required
certifications regarding their status under the federal income tax
law. If the withholding provisions are applicable, any such
distributions and proceeds, whether taken in cash or reinvested in additional
shares, will be reduced by the amounts required to be
withheld. Corporate and other exempt shareholders should provide the
Fund with their taxpayer identification numbers or certify their exempt status
in order to avoid possible erroneous application of backup
withholding. The Fund reserves the right to refuse to open an account
for any person failing to provide a certified taxpayer identification
number.
The
foregoing discussion of U.S. federal income tax law relates solely to the
application of that law to U.S. citizens or residents and U.S. domestic
corporations, partnerships, trusts and estates. Each shareholder who
is not a U.S. person should consider the U.S. and foreign tax consequences of
ownership of shares of the Fund, including the possibility that such a
shareholder may be subject to a U.S. withholding tax at a rate of 30% (or at a
lower rate under an applicable income tax treaty) on amounts constituting
ordinary income.
This
discussion and the related discussion in the Prospectus have been prepared by
Fund management. The information above is only a summary of some of
the tax considerations generally affecting the Fund and its
shareholders. No attempt has been made to discuss individual tax
consequences and this discussion should not be construed as applicable to all
shareholders’ tax situations. Investors should consult their own tax
advisors to determine the suitability of the Fund and the applicability of any
state, local or foreign taxation. Paul Hastings has expressed no
opinion in respect thereof.
The
Adviser, out of its own resources and without additional cost to the Fund or its
shareholders, may provide additional cash payments or other compensation to
certain financial intermediaries who sell shares of the Fund. Such payments may
be divided into categories as follows:
Support
Payments. Payments may be made by the Adviser to certain
financial intermediaries in connection with the eligibility of the Fund to be
offered in certain programs and/or in connection with meetings between the
Fund’s representatives and financial intermediaries and its sales
representatives. Such meetings may be held for various purposes, including
providing education and training about the Fund and other general financial
topics to assist financial intermediaries’ sales representatives in making
informed recommendations to, and decisions on behalf of, their
clients.
Entertainment, Conferences and
Events. The Adviser also may pay cash or non-cash compensation
to sales representatives of financial intermediaries in the form of (i)
occasional gifts; (ii) occasional meals, tickets or other entertainments; and/or
(iii) sponsorship support for the financial intermediary’s client seminars and
cooperative advertising. In addition, the Adviser pays for exhibit
space or sponsorships at regional or national events of financial
intermediaries.
The
prospect of receiving, or the receipt of additional payments or other
compensation as described above by financial intermediaries may provide such
intermediaries and/or their salespersons with an incentive to favor sales of
shares of the Fund, and other mutual funds whose affiliates make similar
compensation available, over sale of shares of mutual funds (or non-mutual fund
investments) not making such payments. You may wish to take such payment
arrangements into account when considering and evaluating any recommendations
relating to the Fund shares.
The Trust
has established an Anti-Money Laundering Program (the “Program”) as required by
the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (“USA PATRIOT Act”). In
order to ensure compliance with this law, the Trust’s Program provides for the
development of internal practices, procedures and controls, designation of
anti-money laundering compliance officers, an ongoing training program and an
independent audit function to determine the effectiveness of the
Program.
Procedures
to implement the Program include, but are not limited to, determining that the
Fund’s Distributor and Transfer Agent have established proper anti-money
laundering procedures, reporting suspicious and/or fraudulent activity, checking
shareholder names against designated government lists, including Office of
Foreign Asset Control (“OFAC”), and a complete and thorough review of all new
opening account applications. The Trust will not transact business
with any person or entity whose identity cannot be adequately verified under the
provisions of the USA PATRIOT Act.
The
Declaration of Trust permits the Trustees to issue an unlimited number of full
and fractional shares of beneficial interest and to divide or combine the shares
into a greater or lesser number of shares without thereby changing the
proportionate beneficial interest in the Fund. Each share represents
an interest in the Fund proportionately equal to the interest of each other
share. Upon the Fund’s liquidation, all shareholders would share pro
rata in the net assets of the Fund available for distribution to
shareholders.
With
respect to the Fund, the Trust may offer more than one class of
shares. The Trust has adopted a Multiple Class Plan pursuant to Rule
18f-3 under the 1940 Act, detailing the attributes of each class of the Fund,
and has reserved the right to create and issue additional series or
classes. Each share of a series or class represents an equal
proportionate interest in that series or class with each other share of that
series or class. Currently, the Fund offers two share classes –Class
A shares and Institutional Class shares.
The
shares of each series or class participate equally in the earnings, dividends
and assets of the particular series or class. Expenses of the Trust
which are not attributable to a specific series or class are allocated among all
the series in a manner believed by management of the Trust to be fair and
equitable. Shares have no pre-emptive or conversion
rights. Shares, when issued, are fully paid and non-assessable,
except as set forth below. Shareholders are entitled to one vote for
each share held. Shares of each series or class generally vote together, except
when required under federal securities laws to vote separately on matters that
only affect a particular class, such as the approval of distribution plans for a
particular class.
The Trust
is not required to hold annual meetings of shareholders but will hold special
meetings of shareholders of a series or class when, in the judgment of the
Trustees, it is necessary or desirable to submit matters for a shareholder
vote. Shareholders have, under certain circumstances, the right to
communicate with other shareholders in connection with requesting a meeting of
shareholders for the purpose of removing one or more
Trustees. Shareholders also have, in certain circumstances, the right
to remove one or more Trustees without a meeting. No material
amendment may be made to the Declaration of Trust without the affirmative vote
of the holders of a majority of the outstanding shares of each portfolio
affected by the amendment. The Declaration of Trust provides that, at
any meeting of shareholders of the Trust or of any series or class, a
Shareholder Servicing Agent may vote any shares as to which such Shareholder
Servicing Agent is the agent of record and which are not represented in person
or by proxy at the meeting, proportionately in accordance with the votes cast by
holders of all shares of that portfolio otherwise represented at the meeting in
person or by proxy as to which such Shareholder Servicing Agent is the agent of
record. Any shares so voted by a Shareholder Servicing Agent will be deemed
represented at the meeting for purposes of quorum requirements. Any
series or class may be terminated (i) upon the merger or consolidation with, or
the sale or disposition of all or substantially all of its assets to, another
entity, if approved by the vote of the holders of two thirds of its outstanding
shares, except that if the Board recommends such merger, consolidation or sale
or disposition of assets, the approval by vote of the holders of a majority of
the series’ or class’ outstanding shares will be sufficient, or (ii) by the vote
of the holders of a majority of its outstanding shares, or (iii) by the Board by
written notice to the series’ or class’ shareholders. Unless each
series and class is so terminated, the Trust will continue
indefinitely.
The
Declaration of Trust also provides that the Trust shall maintain appropriate
insurance (for example, fidelity bonding and errors and omissions insurance) for
the protection of the Trust, its shareholders, Trustees, officers, employees and
agents covering possible tort and other liabilities. Thus, the risk of a
shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which both inadequate insurance existed and the
Trust itself was unable to meet its obligations.
The
Declaration of Trust does not require the issuance of stock
certificates. If stock certificates are issued, they must be returned
by the registered owners prior to the transfer or redemption of shares
represented by such certificates.
Rule
18f-2 under the 1940 Act provides that as to any investment company which has
two or more series outstanding and as to any matter required to be submitted to
shareholder vote, such matter is not deemed to have been effectively acted upon
unless approved by the holders of a “majority” (as defined in the Rule) of the
voting securities of each series affected by the matter. Such
separate voting requirements do not apply to the election of Trustees or the
ratification of the selection of accountants. The Rule contains
special provisions for cases in which an advisory contract is approved by one or
more, but not all, series. A change in investment policy may go into
effect as to one or more series whose holders so approve the change even though
the required vote is not obtained as to the holders of other affected
series.
Investors
in the Fund will be informed of the Fund’s progress through periodic
reports. Financial statements certified by an independent registered
public accounting firm will be submitted to shareholders at least
annually. Since the Fund had not commenced operations as of the date
of this SAI, no financial statements are available.
Corporate
Bond Ratings
Moody’s
Investors Service, Inc.
Aaa:
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
“gilt edge.” Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the
various protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong position of such
issues.
Aa: Bonds
which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are
generally known as high grade bonds. They are rated lower than the
best bonds because margins of protection may not be as large as in Aaa
securities or fluctuations or protective elements may be of greater amplitude or
there may be other elements present which make 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 rated Ba are judged to have speculative elements; their future cannot
be considered as well-assured. Often the protection of interest and
principal payments may be very moderate, and thereby not well safeguarded during
both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B: Bonds
which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.
Caa:
Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.
Ca: Bonds
which are rated Ca represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked
shortcomings.
C: Bonds
which are rated C are the lowest rated class of bonds, and issues so rated can
be regarded as having extremely poor prospectus of ever attaining any real
investment standing. Moody’s applies numerical modifiers, 1, 2 and 3
in each generic rating classification from Aa through B in its corporate bond
rating system. The modified 1 indicates that the security ranks in
the higher end of its generic rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates that the issue ranks in the
lower end of its generic rating category.
Standard
& Poor’s Ratings Group
AAA:
Bonds rated AAA are highest grade debt obligations. This rating
indicates an extremely strong capacity to pay principal and
interest.
AA: Bonds
rated AA also qualify as high-quality debt obligations. Capacity to
pay principal and interest is very strong, and in the majority of instances they
differ from AAA issues only in small degree.
A: Bonds
rated A have a strong capacity to pay principal and interest, although they are
more susceptible to the adverse effects of changes in circumstances and economic
conditions.
BBB:
Bonds rated BBB are regarded as having an adequate capacity to pay principal and
interest. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay principal and interest for bonds in
this category than for bonds in the A category.
BB, B,
CCC, CC, C: Bonds rated BB, B, CCC, CC and C are regarded on balance as
predominantly speculative with respect to capacity to pay interest and repay
principal BB indicates the least degree of speculation and C the
highest. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposure to adverse conditions.
BB: Bonds
rated BB have less near-term vulnerability to default than other speculative
issues. However, it faces major ongoing uncertainties or exposure to
adverse business, financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal
payments. The BB rating category is also used for debt subordinated
to senior debt that is assigned an actual or implied BBB- rating.
B: Bonds
rated B have a greater vulnerability to default but currently have the capacity
to meet interest payments and principal repayments. Adverse business,
financial, or economic conditions will likely impair capacity or willingness to
pay interest and repay principal. The B rating category is also used
for debt subordinated to senior debt that is assigned an actual or implied BB or
BB-rating.
CCC:
Bonds rated CCC have a currently identifiable vulnerability to default and are
dependent upon favorable business, financial, and economic conditions to meet
timely payment of interest and repayment of principal. In the event
of adverse business, financial, or economic conditions, it is not likely to have
the capacity to pay interest and repay principal. The CCC rating
category is also used for debt subordinated to senior debt that is assigned an
actual or implied B or B- rating.
CC: The
rating CC 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.
CI: The
rating CI is reserved for income bonds on which no interest is being
paid.
D: Bonds
rated D are 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 are jeopardized.
Plus (+)
or Minus (-): The ratings from AA to CCC may be modified by the addition of a
plus or minus sign to show relative standing with the major
categories.
APPENDIX
B
Commercial
Paper Ratings
Moody’s
Investors Service, Inc.
Prime-1--Issuers
(or related supporting institutions) rated “Prime-1” have a superior ability for
repayment of senior short-term debt obligations. “Prime-1” repayment
ability will often be evidenced by many of the following characteristics:
leading market positions in well-established industries, high rates of return on
funds employed, conservative capitalization structures with moderate reliance on
debt and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well-established access
to a range of financial markets and assured sources of alternate
liquidity.
Prime-2--Issuers
(or related supporting institutions) rated “Prime-2” have a strong ability for
repayment of senior short-term debt obligations. This will normally
be evidenced by many of the characteristics cited above but to a lesser
degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while
still appropriate, may be more affected by external conditions. Ample
alternative liquidity is maintained.
Standard
& Poor’s Ratings Group
A-1--This
highest category indicates that the degree of safety regarding timely payment is
strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus (+) sign designation.
A-2--Capacity
for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high
as for issues designated “A-1”.
PART
C
(Poplar
Forest Partners Fund)
OTHER
INFORMATION
Item
28. Exhibits
|
(a)
|
Articles of
Incorporation. Agreement and Declaration of Trust dated
October 3, 1996, was previously filed with the Trust’s
Registration Statement on Form N-1A on December 6, 1996, and is
incorporated herein by reference.
|
|
(b)
|
Amended and Restated
By-Laws dated June 27, 2002, were previously filed with
Post-Effective Amendment No. 113 to the Trust’s Registration Statement on
Form N-1A on January 28, 2003, and are incorporated herein by
reference.
|
|
(c)
|
Instruments Defining Rights of
Security Holders are incorporated by reference into the Trust’s
Agreement and Declaration of Trust and Amended and Restated
By-Laws.
|
|
(d)
|
Investment Advisory
Contracts – to be filed by
amendment.
|
|
(e)
|
Underwriting Contracts
– to be filed by amendment.
|
|
(f)
|
Bonus or Profit Sharing
Contracts – not applicable.
|
|
(g)
|
Custodian Agreements.
Custody Agreement was previously filed with Post-Effective
Amendment No. 222 to the Trust’s Registration Statement on Form N-1A on
June 28, 2006, and is incorporated herein by
reference.
|
|
(i)
|
Amendment
to the Custody Agreement – to be filed by
amendment.
|
|
(h)
|
Other
Material Contracts
|
|
(i)
|
Fund
Administration Servicing Agreement was previously filed with
Post-Effective Amendment No. 222 to the Trust’s Registration Statement on
Form N-1A on June 28, 2006, and is incorporated herein by
reference.
|
|
(A)
|
Amendment
to the Fund Administration Servicing Agreement – to be filed by
amendment.
|
|
(ii)
|
Transfer
Agent Servicing Agreement was previously filed with Post-Effective
Amendment No. 222 to the Trust’s Registration Statement on Form N-1A on
June 28, 2006, and is incorporated herein by
reference.
|
|
(A)
|
Addendum
dated March 26, 2009, to the Transfer Agent Servicing Agreement was
previously filed with Post-Effective Amendment No. 282 to the Trust’s
Registration Statement on Form N-1A on April 21, 2009, and is incorporated
herein by reference.
|
|
(B)
|
Amendment
to the Transfer Agent Servicing Agreement – to be filed by
amendment.
|
|
(iii)
|
Fund
Accounting Servicing Agreement was previously filed with Post-Effective
Amendment No. 222 to the Trust’s Registration Statement on Form N-1A on
June 28, 2006, and is incorporated herein by
reference.
|
C-1
|
(A)
|
Amendment
to the Fund Accounting Servicing Agreement – to be filed by
amendment.
|
|
(iv)
|
Operating
Expenses Limitation Agreement – to be filed by
amendment.
|
|
(v)
|
Power
of Attorney was previously filed with Post-Effective Amendment No. 275 to
the Trust’s Registration Statement on Form N-1A on January 23, 2009, and
is incorporated herein by
reference.
|
|
(i)
|
Legal Opinion – to be
filed by amendment.
|
|
(j)
|
Other
Opinions. Consent of Independent Registered Public
Accounting Firm – to be filed by
amendment.
|
|
(k)
|
Omitted Financial
Statements – not applicable.
|
|
(l)
|
Initial Capital Agreements.
Subscription Agreements were previously filed with Pre-Effective
Amendment No. 2 to the Trust’s Registration Statement on Form N-1A on
February 28, 1997, and are incorporated herein by
reference.
|
|
(m)
|
Rule 12b-1 Plan – to be
filed by amendment.
|
|
(n)
|
Rule 18f-3 Plan – to be
filed by amendment.
|
|
(o)
|
Reserved.
|
|
(p)
|
Codes
of Ethics.
|
|
(i)
|
Code
of Ethics applicable to the Registrant was previously filed with
Post-Effective Amendment No. 257 to the Trust’s Registration Statement on
Form N-1A on January 28, 2008, and is incorporated herein by
reference.
|
|
(ii)
|
Code
of Ethics applicable to the Advisor – to be filed by
amendment.
|
|
(iii)
|
Code
of Ethics for Access Persons of Quasar Distributors, LLC dated September
1, 2005, was previously filed with Post-Effective Amendment No. 257 to the
Trust’s Registration Statement on Form N-1A on January 28, 2008, and is
incorporated herein by reference.
|
Item
29. Persons Controlled by or Under Common Control with
Registrant.
No person is directly or indirectly
controlled by or under common control with the Registrant.
Item
30. Indemnification.
Reference is made to Article VII of the
Registrant’s Agreement and Declaration of Trust, Article VI of Registrant’s
Amended and Restated By-Laws and Paragraph 7 of the Distribution
Agreement.
Pursuant to Rule 484 under the
Securities Act of 1933, as amended, the Registrant furnishes the following
undertaking: “Insofar as indemnification for liability arising under
the Securities Act of 1933 (the “Act”) may be permitted to trustees, officers
and controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that, in the opinion of the
Securities and Exchange Commission (“SEC”) such indemnification is against
public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a trustee, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
trustee, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.”
C-2
Item
31. Business and Other Connections of the Investment
Adviser.
With respect to the Adviser, the
response to this Item will be incorporated by reference to the Advisor’s Uniform
Application for Investment Adviser Registration (Form ADV) on file with the SEC
(File No. 801-68455), dated July 22, 2009. The Adviser’s Form ADV may
be obtained, free of charge, at the SEC’s website at www.adviserinfo.sec.gov.
Item
32. Principal Underwriter.
|
(a)
|
Quasar
Distributors, LLC, the Registrant’s principal underwriter, acts as
principal underwriter for the following investment
companies:
|
|
Academy
Funds Trust
|
Jacob
Internet Fund, Inc.
|
|
Advisors
Series Trust
|
Jensen
Portfolio, Inc.
|
|
Allied
Asset Advisors Funds
|
Keystone
Mutual Funds
|
|
Alpine
Equity Trust
|
Kiewit
Investment Fund, LLLP
|
|
Alpine
Income Trust
|
Kirr
Marbach Partners Funds, Inc.
|
|
Alpine
Series Trust
|
LKCM
Funds
|
|
Artio
Global Equity Fund, Inc.
|
Masters'
Select Funds Trust
|
|
Artio
Global Investment Funds
|
Matrix
Advisors Value Fund, Inc.
|
|
Brandes
Investment Trust
|
Monetta
Fund, Inc.
|
|
Brandywine
Blue Fund, Inc.
|
Monetta
Trust
|
|
Brazos
Mutual Funds
|
MP63
Fund, Inc.
|
|
Bridges
Investment Fund, Inc.
|
Nicholas
Family of Funds, Inc.
|
|
Buffalo
Funds
|
Permanent
Portfolio Family of Funds, Inc.
|
|
Country
Mutual Funds Trust
|
Perritt
Funds, Inc.
|
|
Empiric
Funds, Inc.
|
Perritt
Microcap Opportunities Fund, Inc.
|
|
First
American Funds, Inc.
|
Primecap
Odyssey Funds
|
|
First
American Investment Funds, Inc.
|
Professionally
Managed Portfolios
|
|
First
American Strategy Funds, Inc.
|
Prospector
Funds, Inc.
|
|
Fort
Pitt Capital Funds
|
Purisima
Funds
|
|
Glenmede
Fund, Inc.
|
Quaker
Investment Trust
|
|
Glenmede
Portfolios
|
Rainier
Investment Management Mutual Funds
|
|
Greenspring
Fund, Inc.
|
Rockland
Funds Trust
|
|
Guinness
Atkinson Funds
|
Thompson
Plumb Funds, Inc.
|
|
Harding
Loevner Funds, Inc.
|
TIFF
Investment Program, Inc.
|
|
Hennessy
Funds Trust
|
Trust
for Professional Managers
|
|
Hennessy
Funds, Inc.
|
USA
Mutuals Funds
|
|
Hennessy
Mutual Funds, Inc.
|
Wexford
Trust
|
|
Hotchkis
& Wiley Funds
|
Wisconsin
Capital Funds, Inc.
|
|
Intrepid
Capital Management Funds Trust
|
WY
Funds
|
C-3
|
(b)
|
To
the best of Registrant’s knowledge, the directors and executive officers
of Quasar Distributors, LLC are as
follows:
|
|
Name
and Principal
Business
Address
|
Position
and Offices with Quasar
Distributors,
LLC
|
Positions
and Offices with
Registrant
|
|
James
R. Schoenike(1)
|
President,
Board Member
|
None
|
|
Andrew
M. Strnad(2)
|
Secretary
|
None
|
|
Joe
D. Redwine(1)
|
Board
Member
|
Trustee,
Chairman and Chief Executive Officer
|
|
Robert
Kern(1)
|
Board
Member
|
None
|
|
Eric
W. Falkeis(1)
|
Board
Member
|
None
|
|
Susan
LaFond(1)
|
Treasurer
|
None
|
|
Teresa
Cowan(1)
|
Assistant
Secretary
|
None
|
|
(1) This
individual is located at 615 East Michigan Street, Milwaukee, Wisconsin,
53202.
(2)
This individual is located at 6602 East 75th Street, Indianapolis,
Indiana, 46250.
|
||
(c) Not
applicable.
Item
33. Location of Accounts and Records.
The books and records required to be
maintained by Section 31(a) of the Investment Company Act of 1940 are maintained
at the following locations:
|
Records
Relating to:
|
Are
located at:
|
|
Registrant’s
Fund Administrator, Fund Accountant and Transfer Agent
|
U.S.
Bancorp Fund Services, LLC
615
East Michigan Street, 3rd Floor
Milwaukee,
WI 53202
|
|
Registrant’s
Custodian
|
U.S.
Bank National Association
Custody
Operations
1555
North River Center Drive, Suite 302
Milwaukee,
WI 53212
|
|
Registrant’s
Investment Adviser
|
Poplar
Forest Capital, LLC
70
S. Lake Avenue, Suite 930
Pasadena,
CA 91101-4703
|
|
Registrant’s
Distributor
|
Quasar
Distributors, LLC
615
East Michigan Street, 4th
Floor
Milwaukee,
WI 53202
|
Item
34. Management Services Not Discussed in Parts A and B.
Not Applicable.
Item
35. Undertakings.
Not Applicable.
C-4
SIGNATURES
Pursuant to the requirements of the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, the Registrant has duly caused this Post-Effective Amendment No. 292 to
its Registration Statement on Form N-1A to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Milwaukee and State of
Wisconsin, on the 15th day of October, 2009.
Advisors
Series Trust
By: /s/ Douglas G.
Hess
Douglas
G. Hess
President
Pursuant to the requirements of the
Securities Act of 1933, as amended, this Post-Effective Amendment No. 292 to its
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
|
Signature
|
Title
|
Date
|
|
|
Michael D. LeRoy*
|
Trustee
|
October
15, 2009
|
|
|
Michael
D. LeRoy
|
|||
|
Donald E. O’Connor*
|
Trustee
|
October
15, 2009
|
|
|
Donald
E. O’Connor
|
|||
|
George Rebhan*
|
Trustee
|
October
15, 2009
|
|
|
George
Rebhan
|
|||
|
George T. Wofford*
|
Trustee
|
October
15, 2009
|
|
|
George
T. Wofford
|
|||
|
Joe D. Redwine*
|
Trustee,
Chairman and Chief
|
October
15, 2009
|
|
|
Joe
D. Redwine
|
Executive
Officer
|
||
|
/s/ Cheryl L. King
|
Treasurer
and Principal
|
October
15, 2009
|
|
|
Cheryl
L. King
|
Financial
Officer
|
||
|
/s/ Douglas G. Hess
|
President
and Principal
|
October
15, 2009
|
|
|
Douglas
G. Hess
|
Executive
Officer
|
||
|
*By:
/s/ Douglas G. Hess
|
October
15, 2009
|
||
|
Douglas
G. Hess
Attorney-In
Fact pursuant to
Power
of Attorney
|
C-5
EXHIBIT
INDEX
|
Exhibit
|
Exhibit
No.
|
C-6