EDGAR Filing Documents for 0000891804-10-003848

The Value, Partners Value, Partners III and Hickory Funds (the “Weitz Equity Funds”) are each non-diversified, open-end investment management companies under the federal securities laws. Because each Weitz Equity Fund is non-diversified, it may have larger positions in fewer companies or industries than a diversified fund. A concentrated portfolio is more likely to experience significant fluctuations in value, exposing the respective Fund to a greater risk of loss in any given period than a diversified fund.

The investment objective of each Weitz Equity Fund is capital appreciation. The investment objective of each Weitz Equity Fund may be changed without a shareholder vote. Each of the Weitz Equity Funds seeks to achieve its objective by investing primarily in common stocks and a variety of securities convertible into common stocks such as rights, warrants, convertible preferred stocks and convertible bonds. Each Weitz Equity Fund may also invest in put and call options. In addition, the Partners III Fund may invest in commodities contracts and futures such as stock index

futures, may borrow money, purchase securities on margin and engage in short selling of securities (including short selling of exchange-traded funds). Each Weitz Equity Fund may invest in the securities of other investment companies, which may include exchange-traded funds. Each Weitz Equity Fund may invest in equity securities of issuers of all sizes, including smaller capitalization companies (which are those with a market capitalization of less than $2 billion). Each Weitz Equity Fund may also invest in other securities of a company not convertible into common stock, such as bonds and preferred stock, which Weitz & Co. determines may offer the opportunity for capital appreciation. Such convertible or non-convertible securities may be investment grade, non-investment grade or unrated. Each Weitz Equity Fund considers long-term capital gains preferable to short-term capital gains and dividend and interest income, but all such gains and income are acceptable.

The Value Fund invests the majority of its assets in the common stock of larger companies. We consider larger-cap companies to be issuers with a market capitalization equal to or greater than the median capitalization of companies in the Russell 1000 Index at the time of purchase. The Partners Value and Partners III Opportunity Funds are “multi-cap” funds and may invest in the securities of any market capitalization. The Hickory Fund invests the majority of its assets in the common stock of smaller and medium-sized companies. Currently, we consider smaller and medium-sized companies to be issuers with a market capitalization of less than $10 billion at the time of initial purchase.

The portfolios of each of the Weitz Equity Funds are generally more concentrated than many mutual funds. It is not uncommon for us to invest 40-55% of a Fund’s portfolio in the top ten positions (but this is not a requirement).

Tax considerations are secondary to the primary goal of capital appreciation, but all things being equal, the portfolios are managed to maximize after-tax returns for tax-paying shareholders. For example, we prefer long-term capital gains to short-term gains and we optimize the realization of capital losses when possible.

The investment strategy of each Weitz Equity Fund (which is called “value investing”) is to (1) identify attractive businesses that Weitz & Co. can understand and which have honest, competent management, (2) estimate the price that an informed, rational buyer would pay for 100% of that business, and then (3) buy securities of the business if they are available at a significant discount to this “business value” or “private market value.” The valuation process may focus on asset values, earning power, the intangible value of a company’s “franchise,” or a combination of these variables, depending on the type of business and other factors. Purchasing securities at a discount to value is intended to provide what Benjamin Graham called a “margin of safety.” The margin of safety does not eliminate risk, but it is intended to reduce the likelihood of permanent loss of capital.

Each of the Weitz Equity Funds has, however, adopted a policy which allows each Weitz Equity Fund to invest for temporary defensive purposes a portion or all of its assets in high quality nonconvertible preferred stock, high quality nonconvertible debt securities and high quality U.S. Government, state and municipal and governmental agency and instrumentality obligations, or retain funds in cash or cash equivalents, such as money market fund shares when Weitz & Co.

believes that market or economic conditions warrant such a temporary defensive investment position.

Some of the obligations purchased by the Weitz Equity Funds are backed by the full faith and credit of the U.S. Government and are guaranteed as to both principal and interest by the U.S. Treasury. Examples of these include direct obligations of the U.S. Treasury, such as U.S. Treasury bills, notes and bonds, and indirect obligations of the U.S. Treasury, such as obligations of the Government National Mortgage Association, Small Business Administration, Maritime Administration, Farmers Home Administration and Department of Veterans Affairs.

While the obligations of many of the agencies of the U.S. Government are not direct obligations of the U.S. Treasury, they are generally backed indirectly by the U.S. Government. Some of the agencies are indirectly backed by their right to borrow from the U.S. Government, such as the Federal Financing Bank. Other agencies and Government-Sponsored Enterprises (“GSEs”) are supported solely by the credit of the agency or GSE itself, but are given additional support due to the U.S. Treasury’s authority to purchase their outstanding debt obligations. GSEs include, among others, the Federal Home Loan Banks, Federal Farm Credit Banks, Federal Home Loan Mortgage Company (“Freddie Mac”) and Federal National Mortgage Association (“Fannie Mae”). No assurance can be given that the U.S. Government would provide support to GSEs, and these entities’ securities are neither issued nor guaranteed by the U.S. Treasury. Fannie Mae and Freddie Mac historically were neither guaranteed nor insured by the U.S. Government. However, on September 7, 2008, the Federal Housing Finance Agency placed Fannie Mae and Freddie Mac into conservatorship, which, in effect, has caused Fannie Mae and Freddie Mac to become guaranteed obligations of the U.S. Government. Although the U.S. Government is providing support to Fannie Mae and Freddie Mac, no assurance can be given that they will continue to do so.

Furthermore, with respect to the U.S. Government securities purchased by the Weitz Equity Funds, guarantees as to the timely payment of principal and interest do not extend to the value or yield of these securities, nor do they extend to the value of a Fund’s shares.

State and municipal obligations, which can be taxable or tax exempt, may include both, general obligation and revenue obligations, issued for a variety of public purposes such as highways, schools, sewer and water facilities, as well as industrial revenue bonds issued by public bodies to finance private commercial and industrial facilities.

This section provides a more detailed description of some of the types of securities and other instruments in which the Weitz Equity Funds may invest. The Weitz Equity Funds may invest in these instruments to the extent permitted by their investment objective and policies and by applicable law. The Weitz Equity Funds are not limited by this discussion and may invest in any other types of instruments not precluded by the policies discussed elsewhere in the Prospectus or Statement of Additional Information.

Industry Concentration Although each Weitz Equity Fund has adopted a fundamental investment restriction which does not allow it to concentrate its investments in any one industry, each Weitz

Equity Fund reserves the right to invest up to 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies or instrumentalities and repurchase agreements relating thereto.

Convertible Securities In addition to common stocks, each Weitz Equity Fund may invest in other securities having equity features because they are convertible into, or represent the right to purchase, common stock. Convertible bonds and debentures are corporate debt instruments, frequently unsecured and subordinated to senior corporate debt, which may be converted into common stock at a specified price. Such securities may trade at a premium over their face amount when the price of the underlying common stock exceeds the conversion price, but otherwise will normally trade at prices reflecting current interest rate levels.

Warrants and Rights Warrants and rights are options to purchase common stock at a specified price for a specified period of time. Their trading price will normally reflect the relationship between the option price and the current market price of the underlying common stock. If not sold or exercised before their expiration date they become valueless.

Other Securities Although the Weitz Equity Funds primarily invest in common stocks and securities convertible into common stocks, each Weitz Equity Fund may also invest in other securities, including preferred stock and debt securities, which Weitz & Co. determines may offer the opportunity for capital appreciation. Such convertible or non-convertible securities may or may not be rated investment grade or may be unrated. Each Weitz Equity Fund will not invest more than 15% of its assets in fixed income securities that are non-investment grade or unrated. Generally investment grade securities are those with a rating of BBB or better by Standard & Poor’s or Fitch Ratings or Baa2 or better by Moody’s.

Securities rated BBB/Baa2 are considered “investment grade” by the financial community, but are described by Standard & Poor’s, Fitch and Moody’s as “medium grade obligations” which have “speculative characteristics.” The market values of lower-rated and unrated securities tend to reflect individual corporate developments to a greater extent than do higher-rated securities, which react primarily to fluctuations in the general level of interest rates. Lower-rated and unrated securities also tend to be more sensitive to economic conditions than are higher-rated securities and thus generally involve more credit risk. Changes in economic conditions or other circumstances may cause issuers of lower-rated or unrated securities to have more difficulty making principal and interest payments than issuers of higher-rated securities.

The market value of debt securities is significantly affected by changes in interest rates. Generally the longer the average maturity of the debt security in the Funds′ investment portfolio, the more the share price of the respective Fund will fluctuate in response to interest rate changes.

grade securities. It also may be more difficult during times of adverse market conditions to sell lower-rated or unrated securities at their fair market value to meet redemption requests or to respond to changes in the market. Although the ratings of established rating agencies may be considered in evaluating a particular security, Weitz & Co. will not rely exclusively on such ratings, but will supplement such ratings with its independent and ongoing review of credit quality.

Investment Company Shares The Weitz Equity Funds may purchase securities of other investment companies, including shares of the Government Money Market Fund, subject to the restrictions of the Investment Company Act of 1940. Investing in the shares of other registered investment companies involves the risk that such other registered investment companies will not achieve their objectives or will achieve a yield or return that is lower than that of the respective Weitz Equity Fund. To the extent that the Weitz Equity Funds are invested in shares of other investment companies, the Weitz Equity Funds will incur additional expenses as a result of investing in investment company shares.

Investments in Exchange Traded Funds The Weitz Equity Funds may invest in or sell short exchange traded funds (“ETFs”). ETFs that are based on a specific index may not be able to replicate and maintain exactly the composition and relative weightings of securities in the applicable index. ETFs also incur certain expenses not incurred by their applicable index. Additionally, certain securities comprising the index tracked by an ETF may, at times, be temporarily unavailable, which may impede an ETF’s ability to track its index. As a holder of interests in an exchange-traded fund, a Weitz Equity Fund would indirectly bear its ratable share of that fund’s expenses, including applicable management fees. At the same time, a Weitz Equity Fund would continue to pay its own management and advisory fees and other expenses, as a result of which the Weitz Equity Fund and its shareholders in effect may be absorbing multiple levels of certain fees with respect to investments in such exchange-traded funds.

Borrowing The Weitz Equity Funds are each authorized to borrow money in order to purchase securities. Borrowing may be considered to be a form of leverage. The Investment Company Act of 1940 requires a Fund to maintain continuous asset coverage of 300% of the amount borrowed. If the 300% asset coverage (that is, total assets including borrowings, less liabilities exclusive of borrowings) should decline as a result of market fluctuations or for other reasons, a Fund may be required to sell some of its portfolio holdings within three days in order to reduce the debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to sell securities at that time. Borrowed funds are subject to interest costs that may or may not be offset by amounts earned on the borrowed funds. A Fund may be required to maintain minimum average balances in connection with its borrowing or pay a commitment or other fee to maintain a line of credit, and either of these requirements would serve to increase the cost of borrowing over the stated interest rate.

Foreign Securities The Weitz Equity Funds may purchase foreign securities that are listed on a principal foreign securities exchange or over-the-counter market, or which are represented by American Depository Receipts and are listed on a domestic securities exchange or traded in the United States over-the-counter market. The Weitz Equity Funds may occasionally convert U.S. dollars into foreign currency, but only to effect securities transactions on a foreign securities exchange and not to hold such currency as an investment. The Weitz Equity Funds will not invest

in forward foreign currency contracts, except to hedge against the currency risk related to foreign securities held in the portfolio. While none of the Weitz Equity Funds have any present intention to invest any significant portion of its assets in foreign securities, the Weitz Equity Funds reserve the right to invest not more than 25% of the value of their respective total assets in the securities of foreign issuers and obligors.

Investors should recognize that investments in foreign companies involve certain considerations that are not typically associated with investing in domestic companies. An investment may be affected by changes in currency rates and in exchange control regulations. Foreign companies are not generally subject to uniform accounting, auditing and financial reporting standards comparable to those applicable to domestic companies, and there may be less publicly available information about a foreign company than about a domestic company. Some foreign stock markets may have substantially less trading activity than the United States securities markets, and securities of some foreign companies may be less liquid than securities of comparable domestic companies. Also, commissions on transactions in foreign securities may be higher than similar transactions on domestic stock markets and foreign governments may impose taxes on securities transactions or ownership. There is generally less governmental regulation of stock exchanges, brokers, and listed and unlisted companies in foreign countries than in the United States. In addition, individual foreign economies may differ favorably or unfavorably from the economy of the United States in such respects as growth of gross national product, rate of inflation, capital reinvestment, resource self-sufficiency and balance of payments position.

Restricted/Illiquid Securities The Weitz Equity Funds may invest in securities acquired in a privately negotiated transaction directly from the issuer or a holder of the issuer's securities and which, therefore, could not ordinarily be sold by the respective Weitz Equity Fund except in another private placement or pursuant to an effective registration statement under the Securities Act of 1933 or an available exemption from such registration requirements. The Weitz Equity Funds may also invest in other illiquid securities, i.e. those that cannot be sold or disposed of in the ordinary course of business at approximately the value at which they are being carried on the respective Fund’s books. Illiquid securities may include a wide variety of investments, including, without limitation (a) repurchase agreements maturing in more than seven days; (b) fixed time deposits that are not subject to prepayment or do not provide for withdrawal penalties upon prepayment (other than overnight deposits); (c) participation in loans; (d) municipal lease obligations; and (e) commercial paper issued pursuant to Section 4(2) of the 1933 Act. If a substantial market develops for a restricted (or other illiquid investment) held by a Weitz Equity Fund, it may be treated as a liquid security, in accordance with procedures and guidelines approved by the Trustees of the Trust (the “Trustees”). This generally includes securities that are unregistered, that can be sold to qualified institutional buyers in accordance with Rule 144A under the 1933 Act, or that are exempt from registration under the 1933 Act, such as commercial paper. While Weitz & Co. monitors the liquidity of restricted securities on a daily basis, the Trustees oversee and retain ultimate responsibility for Weitz & Co.’s liquidity determinations. Several factors considered in monitoring decisions about liquidity include the valuation of a security, the availability of qualified institutional buyers, brokers and dealers that trade in the security, and the availability of information about the security’s issuer. None of the Weitz Equity Funds will invest in any such restricted or illiquid securities which will cause the then aggregate value of all such securities to exceed 15% of the value of the respective Weitz Equity Fund's net assets. Restricted and illiquid securities will be

valued in such manner as the Trustees in good faith deem appropriate to reflect their fair value. The purchase price, subsequent valuation and resale price of restricted securities normally reflect a discount from the price at which such securities trade when they are not restricted, since the restriction makes them less marketable. The amount of the discount from the prevailing market price will vary depending upon the type of security, the character of the issuer, the party who will bear the expenses of registering the restricted securities, and prevailing supply and demand conditions.

Covered Call Options The Weitz Equity Funds may write covered call options to generate premium income which Weitz & Co. considers to be an acceptable investment result. Covered call options are contracts sold on a national exchange or in the over-the-counter options market which allow the purchaser to buy the underlying security at a specified price (the "strike price") prior to a certain date. "Covered" options are those in which the option seller (the "writer") owns the underlying securities. Writing covered call options may increase the income of a Weitz Equity Fund since it receives a premium for writing the option. If a Weitz Equity Fund writes covered call options, the underlying securities will be subject to certain deposit procedures and unavailable for sale during the term of the option. As a result, the respective Weitz Equity Fund will forego any opportunity for appreciation in such securities during the term of the option. The respective Weitz Equity Fund may attempt to protect itself against a decline in the price of the underlying security or may attempt to benefit from an anticipated increase in such price, by closing the covered call position that is, purchasing an identical call in the open market. There is no assurance, however, that such calls will always be available for purchase in the secondary market at a price which will produce the desired result. The absence of a liquid secondary market in such securities could result from numerous circumstances, such as insufficient trading interest, restrictions imposed by exchanges as to options trading generally or suspensions affecting particular securities, inadequacy of exchange or clearing corporation facilities or decisions by exchanges to discontinue or limit operations trading.

Bank Obligations The Weitz Equity Funds may purchase bank obligations, including negotiable certificates of deposit and bankers’ acceptances, which evidence the banking institution’s obligation to repay funds deposited with it for a specified period of time at a stated interest rate. The Weitz Equity Funds will normally purchase such obligations from financial institutions which have capital, surplus and undivided profits in excess of $100,000,000 as of the date of the bank’s most recently published financial statements and financial institutions whose obligations are insured by the Federal Deposit Insurance Corporation. Certificates of deposit generally have penalties for early withdrawal, but can be sold to third parties subject to the same risks as other fixed income securities.

Repurchase Agreements The Weitz Equity Funds may invest in repurchase agreements on U.S. Government securities. Repurchase agreements involve the purchase of U.S. Government securities and a simultaneous agreement with the seller to “repurchase” the securities at a specified price and time, thereby determining the yield during the purchaser’s holding period. This, results in a fixed rate of return insulated from market fluctuations during such period. Repurchase agreements usually are for short periods, such as one week. If a repurchase agreement is construed to be a collateralized loan, the underlying securities will not be considered to be owned by the respective Weitz Equity Fund but only constitute collateral for the seller’s obligation to pay the repurchase

price and, in the event of a default by the seller, the respective Fund may suffer delays and incur costs or losses in connection with the disposition of the collateral. A repurchase agreement may involve certain risks not associated with a direct purchase of U.S. Government securities. For example, the bank or broker selling the repurchase agreement may default on its obligations to deliver additional securities or to maintain the value of collateral underlying the repurchase agreement or it may fail to repurchase the underlying securities at a time when the value has declined. A Weitz Equity Fund may incur a loss as a result of such default if the liquidation of the collateral results in proceeds less than the repurchase price. In an effort to minimize such risks, the Weitz Equity Funds will only enter into repurchase agreements with member banks of the Federal Reserve with assets, surplus and undivided profits of $100,000,000 or more or recognized regional or national securities dealers.

Commercial Paper The Weitz Equity Funds may purchase commercial paper which consists of short-term unsecured promissory notes. The Weitz Equity Funds will purchase only commercial paper either (a) rated Prime 1 by Moody’s or A-1 by Standard & Poor’s or (b) if not rated, issued by or guaranteed by companies which have an outstanding debt issue rated AA or better by Standard & Poor’s or Aa or better by Moody’s.

When Issued or Forward Commitment Transactions The Weitz Equity Funds may engage in when issued or forward commitment transactions which involve the purchase or sale of a security by a Weitz Equity Fund with payment and delivery taking place in the future to secure what is considered an advantageous yield and price to the respective Weitz Equity Fund at the time of entering into the transaction. To the extent a Weitz Equity Fund enters into such forward commitments, it will segregate or “earmark” cash or liquid assets with an aggregate value equal to the amount of its commitment in connection with such purchase transactions.

Stock Index Futures Contracts The Partners III Fund may buy and sell futures contracts, principally stock index futures contracts. A stock index fluctuates generally with changes in the market values of the stocks included in the index. A stock index futures contract is a bilateral agreement pursuant to which two parties agree to take or make delivery of an amount of cash equal to a specified dollar amount multiplied by the difference between the stock index value at the close of the last trading day of the contract and the price at which the futures contract is originally purchased or sold. No physical delivery of the underlying stocks in the index is made.

The Partners III Fund’s primary purpose in entering into such contracts is to protect it from fluctuations in the value of securities without actually buying or selling the underlying security. For example, if the Partners III Fund anticipates an increase in the price of stocks, and it intends to purchase stocks at a later time, the Partners III Fund could enter into a futures contract to purchase a stock index as a temporary substitute for stock purchases. If an increase in the market occurs that influences the stock index as anticipated, the value of the futures contracts will increase, thereby serving as a hedge against the Partners III Fund not participating in a market advance. This technique is sometimes known as an anticipatory hedge. To the extent the Partners III Fund enters into futures contracts for this purpose, the segregated assets maintained to cover the Partners III Fund’s obligations with respect to the futures contracts will consist of other liquid assets from its portfolio in an amount equal to the difference between the contract price and the aggregated value of the initial and variation margin payments made by the Partners III Fund with respect to the

futures contracts. However, because the Partners III Fund’s cash that may otherwise be invested would be held un-invested or invested in other liquid assets so long as the futures position remains open, the Partners III Fund’s return could be diminished due to the opportunity losses of foregoing other potential investments. Conversely, if the Partners III Fund holds stocks and seeks to protect itself from an expected decrease in stock prices, the Partners III Fund might sell stock index futures contracts, thereby hoping to offset the potential decline in the value of securities by a corresponding increase in the value of the futures contract position. The Partners III Fund could protect against a decline in stock prices by selling portfolio securities and investing in money market instruments, but the use of futures contracts enables it to maintain a defensive position without having to sell portfolio securities.

The Partners III Fund may also buy and sell futures contracts on commodities, interest rates, currencies or other indices. Interest rate, commodity or currency futures contracts may be used as a hedge against changes in prevailing levels of interest rates, commodity prices or currency exchange rates in order to establish more definitely the effective return on securities or currencies held or intended to be acquired by the Fund. Interest rate, commodity or currency futures can be sold as an offset against the effect of expected increases in interest rates, declines in commodity prices or currency exchange rates and purchased as an offset against the effect of expected declines in interest rates, increases in commodity prices or currency exchange rates.

There is no assurance a liquid market will exist for any particular futures contract at any particular time. Exchanges may establish daily price fluctuation limits for futures contract, and may halt trading if a contract’s price moves upward or downward more than the limit in a given day. On volatile trading days when the price fluctuation limit is reached or a trading halt is imposed, it may be impossible to enter into new positions or close out existing positions. If the market for a contract is not liquid because of price fluctuation limits or other market conditions, it could prevent prompt liquidation of unfavorable positions, and potentially could require the Partners III Fund to continue to hold a position until delivery or expiration regardless of changes in its value. As a result the Partners III Fund’s access to other assets held to cover its futures positions could also be impaired.

Because there are a limited number of types of exchange-traded futures contracts, it is likely that the standardized contracts available will not match the Partners III Fund’s current or anticipated investments exactly. The Partners III Fund may invest in futures contracts based on securities with different issuers, maturities or other characteristics from the securities in which the Partners III Fund typically invests, which involves a risk that the futures positions will not track the performance of the Partners III Fund’s other investments.

Futures prices can also diverge from the prices of their underlying instruments, even if the underlying instruments match the Partners III Fund’s investments well. Futures prices are affected by such factors as current and anticipated short-term interest rates, changes in volatility of the underlying instruments and the time remaining until expiration of the contract, which may not affect security prices the same way. Imperfect correlation may also result from differing levels of demand in the futures markets and the securities markets, from structural differences in how futures and securities are traded or from imposition of daily price fluctuation limits or trading halts. The Partners III Fund may purchase or sell futures contracts with a greater or lesser value than the securities it wishes to hedge or intends to purchase in order to attempt to compensate for the

difference in volatility between the contract and the securities although this may not be successful in all cases. If price changes in the Partners III Fund’s futures positions are poorly correlated with its other investments, the positions may fail to produce anticipated gains or result in losses that are not offset by gains in other investments.

The risk of loss in trading futures contracts can be substantial, due both to the low margin deposits required and the extremely high degree of leverage involved in futures pricing. Because the deposit requirements in the futures markets are less onerous than margin requirements in the securities market, there may be increased participation by speculators in the futures market that may also cause temporary price distortions. A relatively small price movement in a futures contract may result in immediate and substantial loss (as well as gain) to the investor. For example, if at the time of purchase, 10% of the value of a futures contract is deposited as margin, a subsequent 10% decrease in the value of the futures contract would result in a total loss of the margin deposit, before any deduction for the transaction costs, if the amount were then closed out. Thus, a purchase or sale of a futures contract may result in losses in excess of the amount invested in the contract. The Partners III Fund will only engage in futures transactions when it is believed these risks are justified and will engage in futures transactions primarily for risk management purposes.

Futures transactions involve brokerage costs and require the Partners III Fund to segregate liquid assets to cover its performance under such contracts. The Partners III Fund’s overall performance could be adversely affected by entering into such contracts if the Adviser’s judgment with respect to the investment proves incorrect.

Short Sales, Put and Call Options The Weitz Equity Funds may engage in short sales and buy and sell put and call options on equity securities, including ETFs, or futures contracts. Short sales involve the sale of a security that the respective Weitz Equity Fund does not own (but instead has borrowed) in anticipation of a decline in the value of the security. To the extent that a Weitz Equity Fund engages in short sales, the Fund will place in a segregated account a sufficient amount of cash and securities as required by applicable federal securities regulations in order to cover the transaction. In the event that the value of the security sold short increases in value rather than decreases, the respective Weitz Equity Fund would suffer a loss when it purchases the security sold short. Since there is, theoretically, no limit to how high the price of the stock might rise, the potential loss from the short sale is greater than the original proceeds of the short sale. The Weitz Equity Funds may also engage in short sales “against the box.” A short sale “against the box” is a form of short sale in which the Fund contemporaneously owns or has the right to obtain at no additional cost securities identical to those sold short. The segregation of cash or other securities is not required for short sales “against the box.” In the event that any Weitz Equity Fund were to sell securities short “against the box” and the price of such securities were to then increase rather than decrease, such Fund would forego the potential realization of the increased value of the shares held long.

Options such as puts and calls are contracts giving the holder the right to either buy or sell a financial instrument at a specified price before a specified time. Investments in puts and calls involve certain risks including the risk that since puts and calls are options which have an expiration date, the respective Weitz Equity Fund could lose the entire cost of those puts and calls which expire worthless.

Loans of Portfolio Securities The Weitz Equity Funds are permitted to engage in securities lending to the extent permitted by SEC policy. Qualified institutions may borrow portfolio securities on a short-term basis. By reinvesting any cash collateral received in these transactions, additional income gains or losses may be realized. The SEC currently permits loans of a mutual fund’s securities up to one-third of its assets, including any collateral received from the loan, provided that the loans are 100% collateralized by cash or cash equivalents on a marked to market basis. Although voting rights of the loaned securities may pass to the borrower, if a material event affecting the investment in the loaned securities is to occur, the respective Weitz Equity Fund must terminate the loan and vote the securities. Alternatively, the respective Weitz Equity Fund may enter into an arrangement that ensures that it can vote the proxy even while the borrower continues to hold the securities. The principal risk in lending securities is the possibility that the invested collateral will decline in value, or, as with other extensions of credit, a borrower may fail to honor its obligations, causing a loss for the respective Weitz Equity Fund.

The following investment restrictions are fundamental restrictions which cannot be changed without the approval of a majority of the respective Weitz Equity Fund’s outstanding shares. “Majority” means, the lesser of (a) 67% or more of a Weitz Equity Fund’s outstanding shares voting at a special or annual meeting of shareholders at which more than 50% of the outstanding shares are represented in person or by proxy or (b) more than 50% of a Weitz Equity Fund’s outstanding shares.

None of the Weitz Equity Funds may:

1.	Underwrite or deal in offerings of securities of other issuers as a sponsor or underwriter in any way.

2.	Purchase or sell real estate except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

3.	Purchase or sell physical commodities or commodity futures contracts, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

4.	Issue any senior security, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

5.	Make loans to others, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

6.	Borrow money, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

7.	Invest more than 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies and instrumentalities and repurchase agreements relating thereto.

As to 50% of its total assets, (a) invest more than 5% of its total assets (taken at market value at the time of each investment) in the securities of any one issuer, nor (b) purchase more than 10% of the outstanding voting securities of an issuer, except that such restrictions shall not apply to securities issued or guaranteed by the U.S. Government or its agencies, bank money instruments or bank repurchase agreements.

INVESTMENT OBJECTIVES, POLICIES AND RESTRICTIONS-

BALANCED FUND

Investment Objectives and Strategy

The Balanced Fund is a non-diversified, open-end investment management company as defined in the Investment Company Act of 1940. Because the Balanced Fund is non-diversified, it may have larger positions in fewer companies or industries than a diversified fund. A concentrated portfolio is more likely to experience significant fluctuations in value, exposing the Fund to a greater risk of loss in any given period than a diversified fund.

The investment objectives of the Balanced Fund are regular current income, capital preservation and long-term capital appreciation. The Balanced Fund invests primarily in a portfolio of U.S. equity and fixed income securities. Under normal market conditions, the Balanced Fund will invest at least 25% of its total assets in investment-grade fixed income securities. The fixed income securities in which the Balanced Fund may invest include, without limitation: (1) U.S. Government securities (bills, notes, bonds and other debt securities issued by the U.S. Treasury); (2) U.S. Government agency securities; (3) corporate debt securities; (4) mortgage-backed securities; (5) taxable municipal bonds; (6) preferred stock; (7) bank obligations (certificates of deposit and bankers’ acceptances); (8) commercial paper; (9) repurchase agreements on U.S. Government and U.S. Government agency securities; and (10) securities of registered investment companies which invest in fixed income securities. The Fund may also invest up to 20% of its total assets in fixed income securities which are non-investment grade or unrated. Under normal market conditions, a substantial portion, normally 50-75% of the Balanced Fund’s total assets, will be invested in common stocks and a variety of securities convertible into common stock such as rights, warrants, convertible preferred stock and convertible stock.

Equity Securities The Balanced Fund’s investment strategy with respect to equity securities (which is called “value investing”) is to (1) identify attractive businesses that Weitz & Co. can understand and which have honest, competent management, (2) estimate the price that an informed, rational buyer would pay for 100% of that business, and then (3) buy securities of the business if they are available at a significant discount to this “business value” or “private market value.” The valuation process may focus on asset values, earning power, the intangible value of a company’s “franchise,” or a combination of these variables, depending on the type of business and other factors. Purchasing securities at a discount to value is intended to provide what Benjamin Graham called a “margin of safety.” The margin of safety does not eliminate risk, but it is intended to reduce the likelihood of permanent loss of capital. The Balanced Fund may invest in the equity securities

of issuers of all sizes, including smaller and medium sized companies. We consider smaller or medium sized companies to be those having a market capitalization currently less than $10 billion at the time of initial purchase.

Fixed Income Securities The Balanced Fund’s investment strategy with respect to fixed income securities is to select securities whose yield is sufficiently attractive taking into consideration the risk of ownership. In deciding whether the Balanced Fund should invest in a particular fixed income security, Weitz & Co. considers a number of factors such as the security’s price, coupon and yield-to-maturity, as well as the credit quality of the issuer. In addition, Weitz & Co. reviews the terms of the fixed income security, including subordination, default, sinking fund, and early redemption provisions. The Balanced Fund may invest up to 20% of its total assets in fixed income securities rated below BBB by Standard & Poor’s Corporation or Fitch Ratings or Baa2 by Moody’s Investor’s Service or in unrated securities. Fixed income securities rated below BBB or Baa2 are generally known as “junk bonds.” The Balanced Fund will normally not invest in fixed income securities which are rated below B by S&P or Fitch Ratings or B2 by Moody’s at the time of purchase or which are in default. The Balanced Fund will not be required to dispose of a debt security if it has a rating of B or B2 at the time of purchase, but is downgraded below B or B2 after the time of purchase.

When Weitz & Co. believes that abnormal market conditions or economic conditions warrant a temporary defensive investment position, a greater portion or all of the Balanced Fund’s portfolio may be retained in cash or cash equivalents, such as money market fund shares and repurchase agreements on U.S. Government securities.

This section provides a more detailed description of some of the types of securities and other instruments in which the Balanced Fund may invest. The Balanced Fund may invest in these instruments to the extent permitted by its investment objectives and policies and by applicable law. The Balanced Fund is not limited by this discussion and may invest in any other types of instruments not precluded by the policies discussed elsewhere in the Prospectus or Statement of Additional Information.

Industry Concentration Although the Balanced Fund has adopted a fundamental investment restriction which does not allow it to concentrate its investments in any one industry, the Balanced Fund reserves the right to invest up to 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies or instrumentalities and repurchase agreements relating thereto.

Convertible Securities In addition to common stocks, the Balanced Fund may invest in other securities having equity features because they are convertible into, or represent the right to purchase, common stock. Convertible bonds and debentures are corporate debt instruments, frequently unsecured and subordinated to senior corporate debt, which may be converted into common stock at a specified price. Such securities may trade at a premium over their face amount when the price of the underlying common stock exceeds the conversion price, but otherwise will normally trade at prices reflecting current interest rate levels.

Investment Company Shares The Balanced Fund may purchase securities of other investment companies, including the Government Money Market Fund, subject to the restrictions of the Investment Company Act of 1940. Investing in the shares of other registered investment companies involves the risk that such other registered investment companies will not achieve their objectives or will achieve a yield or return that is lower than that of the Balanced Fund. To the extent that the Balanced Fund is invested in shares of other investment companies, the Balanced Fund will incur additional expenses as a result of investing in investment company shares.

Investments in Exchange Traded Funds The Balanced Fund may invest in exchange traded

funds (“ETFs”). ETFs that are based on a specific index may not be able to replicate and maintain exactly the composition and relative weightings of securities in the applicable index. ETFs also incur certain expenses not incurred by their applicable index. Additionally, certain securities comprising the index tracked by an ETF may, at times, be temporarily unavailable, which may impede an ETF’s ability to track its index. As a holder of interests in an exchange-traded fund, the Balanced Fund would indirectly bear its ratable share of that fund’s expenses, including applicable management fees. At the same time, the Balanced Fund would continue to pay its own management and advisory fees and other expenses, as a result of which the Balanced Fund and its shareholders in effect may be absorbing multiple levels of certain fees with respect to investments in such exchange-traded funds.

Borrowing The Balanced Fund is authorized to borrow money in order to purchase securities. Borrowing may be considered to be a form of leverage. The Investment Company Act of 1940 requires a Fund to maintain continuous asset coverage of 300% of the amount borrowed. If the 300% asset coverage (that is, total assets including borrowings, less liabilities exclusive of borrowings) should decline as a result of market fluctuations or for other reasons, the Balanced Fund may be required to sell some of its portfolio holdings within three days in order to reduce the debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to sell securities at that time. Borrowed funds are subject to interest costs that may or may not be offset by amounts earned on the borrowed funds. The Balanced Fund may be required to maintain minimum average balances in connection with its borrowing or pay a commitment or other fee to maintain a line of credit, and either of these requirements would serve to increase the cost of borrowing over the stated interest rate.

Foreign Securities The Balanced Fund may purchase foreign securities that are listed on a principal foreign securities exchange or over-the-counter market, or which are represented by American Depository Receipts and are listed on a domestic securities exchange or traded in the United States over-the-counter market. The Balanced Fund may occasionally convert U.S. dollars into foreign currency, but only to effect securities transactions on a foreign securities exchange and not to hold such currency as an investment. The Balanced Fund will not invest in forward foreign currency contracts, except to hedge against the currency risk related to foreign securities held in the portfolio. While the Balanced Fund has no present intention of investing any significant portion of

its assets in foreign securities, the Balanced Fund reserves the right to invest not more than 25% of the value of its total assets in the securities of foreign issuers and obligors.

Restricted/Illiquid Securities The Balanced Fund may invest in securities acquired in a privately negotiated transaction directly from the issuer or a holder of the issuer’s securities and which, therefore, could not ordinarily be sold by the Balanced Fund except in another private placement or pursuant to an effective registration statement under the Securities Act of 1933 or an available exemption from such registration requirements. The Balanced Fund may also invest in other illiquid securities, i.e. those that cannot be sold or disposed of in the ordinary course of business at approximately the value at which they are being carried on the Balanced Fund’s books. Illiquid securities may include a wide variety of investments, including, without limitation (a) repurchase agreements maturing in more than seven days; (b) fixed time deposits that are not subject to prepayment or do not provide for withdrawal penalties upon prepayment (other than overnight deposits); (c) participation in loans; (d) municipal lease obligations; and (e) commercial paper issued pursuant to Section 4(2) of the 1933 Act. If a substantial market develops for a restricted (or other illiquid investment) held by the Balanced Fund, it may be treated as a liquid security, in accordance with procedures and guidelines approved by the Trustees. This generally includes securities that are unregistered, that can be sold to qualified institutional buyers in accordance with Rule 144A under the 1933 Act, or that are exempt from registration under the 1933 Act, such as commercial paper. While Weitz & Co. monitors the liquidity of restricted securities on a daily basis, the Trustees oversee and retain ultimate responsibility for Weitz & Co.’s liquidity determinations. Several factors considered in monitoring decisions about liquidity include the valuation of a security, the availability of qualified institutional buyers, brokers and dealers that trade in the security, and the availability of information about the security’s issuer. The Balanced Fund will not invest in any such restricted or illiquid securities which will cause the then aggregate value of all such securities to exceed 15% of the value of the Balanced Fund’s net assets. Restricted and illiquid securities will be valued in such manner as the Trustees in good faith deem appropriate to reflect their fair value. The purchase price, subsequent valuation and resale price of restricted securities normally reflect a discount from the price at which such securities trade when they are not restricted, since the restriction makes them less marketable. The amount of the discount from the

prevailing market price will vary depending upon the type of security, the character of the issuer, the party who will bear the expenses of registering the restricted securities, and prevailing supply and demand conditions.

Covered Call Options The Balanced Fund may write covered call options to generate premium income which Weitz & Co. considers to be an acceptable investment result. Covered call options are contracts sold on a national exchange or in the over-the-counter options market which allow the purchaser to buy the underlying security at a specified price (the “strike price”) prior to a certain date. “Covered” options are those in which the option seller (the “writer”) owns the underlying securities. Writing covered call options may increase the income of the Balanced Fund since it receives a premium for writing the option. If the Balanced Fund writes covered call options, the underlying securities will be subject to certain deposit procedures and unavailable for sale during the term of the option. As a result, the Balanced Fund will forego any opportunity for appreciation in such securities during the term of the option. The Balanced Fund may attempt to protect itself against a decline in the price of the underlying security or may attempt to benefit from an anticipated increase in such price, by closing the covered call position that is, purchasing an identical call in the open market. There is no assurance, however, that such calls will always be available for purchase in the secondary market at a price which will produce the desired result. The absence of a liquid secondary market in such securities could result from numerous circumstances, such as insufficient trading interest, restrictions imposed by exchanges as to options trading generally or suspensions affecting particular securities, inadequacy of exchange or clearing corporation facilities or decisions by exchanges to discontinue or limit operations trading.

Bank Obligations The Balanced Fund may purchase bank obligations, including negotiable certificates of deposit and bankers’ acceptances, which evidence the banking institution’s obligation to repay funds deposited with it for a specified period of time at a stated interest rate. The Balanced Fund will normally purchase such obligations from financial institutions which have capital, surplus and undivided profits in excess of $100,000,000 as of the date of the bank’s most recently published financial statements and financial institutions whose obligations are insured by the Federal Deposit Insurance Corporation. Certificates of deposit generally have penalties for early withdrawal, but can be sold to third parties subject to the same risks as other fixed income securities.

Repurchase Agreements The Balanced Fund may invest in repurchase agreements on U.S. Government securities. Repurchase agreements involve the purchase of U.S. Government securities and a simultaneous agreement with the seller to “repurchase” the securities at a specified price and time, thereby determining the yield during the purchaser’s holding period. This results in a fixed rate of return insulated from market fluctuations during such period. Repurchase agreements usually are for short periods, such as one week. If a repurchase agreement is construed to be a collateralized loan, the underlying securities will not be considered to be owned by the Balanced Fund but only constitute collateral for the seller’s obligation to pay the repurchase price and, in the event of a default by the seller, the Balanced Fund may suffer delays and incur costs or losses in connection with the disposition of the collateral. A repurchase agreement may involve certain risks not associated with a direct purchase of U.S. Government securities. For example, the bank or broker selling the repurchase agreement may default on its obligations to deliver additional securities or to maintain the value of collateral underlying the repurchase agreement or it may fail to repurchase the underlying securities at a time when the value has declined. The Balanced Fund may

incur a loss as a result of such default if the liquidation of the collateral results in proceeds less than the repurchase price. In an effort to minimize such risks, the Balanced Fund will only enter into repurchase agreements with member banks of the Federal Reserve with assets, surplus and undivided profits of $100,000,000 or more or recognized regional or national securities dealers.

Commercial Paper The Balanced Fund may purchase commercial paper which consists of short-term unsecured promissory notes. The Fund will purchase only commercial paper either (a) rated Prime 1 by Moody’s or A-1 by Standard & Poor’s or (b) if not rated, issued by or guaranteed by companies which have an outstanding debt issue rated AA or better by Standard & Poor’s or Aa or better by Moody’s.

When Issued or Forward Commitment Transactions The Balanced Fund may engage in when issued or forward commitment transactions which involve the purchase or sale of a security by the Balanced Fund with payment and delivery taking place in the future to secure what is considered an advantageous yield and price to the Balanced Fund at the time of entering into the transaction. To the extent the Balanced Fund enters into such forward commitments, it will segregate or “earmark” cash or liquid assets with an aggregate value equal to the amount of its commitment in connection with such purchase transactions.

Lower-Rated Debt Securities The Balanced Fund may invest in debt securities rated within the lower grades of Standard & Poor’s, Fitch’s or Moody’s credit ratings. Debt securities in the lower rating categories (rated below Baa2 by Moody’s or below BBB by S&P or Fitch) have speculative characteristics, and changes in economic conditions or other circumstances are much more likely to lead to a weakened capacity to make principal and interest payments than is the case with higher grade bonds. Because the market for lower-rated securities may be thinner and less active than for higher-rated securities, there may be more market price volatility for these securities and limited liquidity in the resale market. Prices of lower-rated debt securities also may be more sensitive to adverse economic changes or corporate developments than higher-rated investments. Debt securities with longer maturities, which may have higher yields, may increase or decrease in value more than debt securities with shorter maturities.

Short Sales, Put and Call Options The Balanced Fund may engage in short sales and buy and sell put and call options. Short sales involve the sale of a security that the Balanced Fund does not own (but instead has borrowed) in anticipation of a decline in the value of the security. To the extent that the Balanced Fund engages in short sales, the Balanced Fund will place in a segregated account a sufficient amount of cash and securities as required by applicable federal securities regulations in order to cover the transaction. In the event that the value of the security sold short increases in value rather than decreases, the Balanced Fund would suffer a loss when it purchases the security sold short. Since there is, theoretically, no limit to how high the price of the stock might rise, the potential loss from the short sale is greater than the original proceeds of the short sale. The Balanced Fund may also engage in short sales “against the box.” A short sale “against the box” is a form of short sale in which the Balanced Fund contemporaneously owns or has the right to obtain at no additional cost securities identical to those sold short. The segregation of cash or other securities is not required for short sales “against the box.” In the event that the Balanced Fund were to sell securities short “against the box” and the price of such securities were to then increase rather than

decrease, the Balanced Fund would forego the potential realization of the increased value of the shares held long.

Options such as puts and calls are contracts giving the holder the right to either buy or sell a financial instrument at a specified price before a specified time. Investments in puts and calls involve certain risks including the risk that since puts and calls are options which have an expiration date, the Balanced Fund could lose the entire cost of those puts and calls which expire worthless.

U.S. Government Obligations A portion of the Balanced Fund may be invested in obligations issued or guaranteed by the U.S. Government, its agencies or Government-Sponsored Enterprises (“GSEs”). Some of the obligations purchased by the Balanced Fund are backed by the full faith and credit of the U.S. Government and are guaranteed as to both principal and interest by the U.S. Treasury. Examples of these include direct obligations of the U.S. Treasury, such as U.S. Treasury bills, notes and bonds, and indirect obligations of the U.S. Treasury, such as obligations of the Government National Mortgage Association, Small Business Administration, Maritime Administration, Farmers Home Administration and Department of Veterans Affairs.

While the obligations of many of the agencies of the U.S. Government are not direct obligations of the U.S. Treasury, they are generally backed indirectly by the U.S. Government. Some of the agencies are indirectly backed by their right to borrow from the U.S. Government, such as the Federal Financing Bank. Other agencies and GSEs are supported solely by the credit of the agency or GSE itself, but are given additional support due to the U.S. Treasury’s authority to purchase their outstanding debt obligations. GSEs include, among others, the Federal Home Loan Banks, Federal Farm Credit Banks, Federal Home Loan Mortgage Company (“Freddie Mac”) and Federal National Mortgage Association (“Fannie Mae”). No assurance can be given that the U.S. Government would provide support to GSEs, and these entities’ securities are neither issued nor guaranteed by the U.S. Treasury. Fannie Mae and Freddie Mac historically were neither guaranteed nor insured by the U.S. Government. However, on September 7, 2008, the Federal Housing Finance Agency placed Fannie Mae and Freddie Mac into conservatorship, which, in effect, has caused Fannie Mae and Freddie Mac to become guaranteed obligations of the U.S. Government. Although the U.S. Government is providing support to Fannie Mae and Freddie Mac, no assurance can be given that they will continue to do so.

Furthermore, with respect to the U.S. Government securities purchased by the Balanced Fund, guarantees as to the timely payment of principal and interest do not extend to the value or yield of these securities, nor do they extend to the value of the Balanced Fund’s shares.

Most mortgage-related securities are pass-through securities, which means, that they provide investors with payments consisting of both principal and interest as the mortgages in the underlying mortgage pool are paid off. The actual yield of such securities is influenced by the prepayment experience of the mortgage pool underlying the securities. In periods of declining interest rates, prepayment for the underlying mortgages tends to increase. If the higher-yielding mortgages from the pool are prepaid, the yield on the remaining pool will be reduced and it will be necessary for the Balanced Fund to reinvest such prepayment, presumably at a lower interest rate. Although, depending on the length of the mortgages in the pool, mortgage-related securities may have a stated maturity of up to forty years, prepayments on the underlying mortgages will make the effective

maturity of the securities shorter. A security based on a pool of forty-year mortgages may have an average life as short as two years. The maturity of mortgage-related securities will be deemed to be the expected effective maturity of the securities.

Interest Rate Futures, Bond Index Futures and Related Options Thereon The Balanced Fund may utilize interest rate futures and bond index futures and related options. The Balanced Fund will not utilize any hedging strategies using interest rate futures and bond index futures or options thereon which will cause the then aggregate value of all such investments to exceed 10% of the value of the Balanced Fund’s total assets at the time of the investment after giving effect thereto. See Appendix A hereto for a general discussion of Interest Rate Futures, Bond Index Futures and Related Options and the risks thereof.

Loans of Portfolio Securities The Balanced Fund is permitted to engage in securities lending to the extent permitted by SEC policy. Qualified institutions may borrow portfolio securities on a short-term basis. By reinvesting any cash collateral received in these transactions, additional income gains or losses may be realized. The SEC currently permits loans of a mutual fund’s securities up to one-third of its assets, including any collateral received from the loan, provided that loans are 100% collateralized by cash or cash equivalents on a marked to market basis. Although voting rights of the loaned securities may pass to the borrower, if a material event affecting the investment in the loaned securities is to occur, the Balanced Fund must terminate the loan and vote the securities. Alternatively, the Balanced Fund may enter into an arrangement that ensures that it can vote the proxy even while the borrower continues to hold the securities. The principal risk in lending securities is the possibility that invested collateral will decline in value, or, as with other extensions of credit, a borrower may fail to honor its obligations, causing a loss for the Balanced Fund.

SHORT-INTERMEDIATE INCOME FUND

The following investment restrictions are fundamental restrictions which cannot be changed without the approval of a majority of the Balanced Fund’s outstanding shares. “Majority” means, the lesser of (a) 67% or more of the Balanced Fund’s outstanding shares voting at a special or annual meeting of shareholders at which more than 50% of the outstanding shares are represented in person or by proxy or (b) more than 50% of the Balanced Fund’s outstanding shares.

The Balanced Fund may not:

1.	Underwrite or deal in offerings of securities of other issuers as a sponsor or underwriter in any way.

2.	Purchase or sell real estate except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

3.	Purchase or sell physical commodities or commodity futures contracts, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

4.	Issue any senior security, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

5.	Make loans to others, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

6.	Borrow money, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

7.	Invest more than 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies and instrumentalities and repurchase agreements relating thereto.

As to 50% of its total assets, (a) invest more than 5% of its total assets (taken at market value at the time of each investment) in the securities of any one issuer, nor (b) purchase more than 10% of the outstanding voting securities of an issuer, except that such restrictions shall not apply to securities issued or guaranteed by the U. S. Government or its agencies, bank money instruments or bank repurchase agreements.

INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS-

The Short-Intermediate Income Fund is a diversified, open-end investment management company as defined in the Investment Company Act of 1940.

The investment objective of the Short-Intermediate Income Fund is high current income consistent with preservation of capital. Under normal market conditions, the Short-Intermediate Income Fund will invest at least 80% of the value of its assets in fixed income securities. This policy is fundamental and may not be changed without shareholder approval. For these purposes “Assets” means the Short-Intermediate Income Fund’s net assets, plus the amount of any borrowings for investment purposes. The fixed income securities in which the Short-Intermediate Income Fund may invest include: (1) U.S. Government securities (bills, notes, bonds and other debt securities issued by the U.S. Treasury); (2) U.S. Government agency securities; (3) corporate debt securities; (4) preferred stock; (5) bank obligations (certificates of deposit and bankers’ acceptances); (6) commercial paper; (7) repurchase agreements on U.S. Government and U.S. Government agency securities; (8) securities of registered investment companies which invest in fixed income securities. The Short-Intermediate Income Fund may invest in securities of all maturities but expects to maintain a dollar-weighted average maturity of between one and ten years.

Weitz & Co. selects fixed income securities whose yield is sufficiently attractive taking into consideration the risk of ownership. In deciding whether the Short-Intermediate Income Fund should invest in particular fixed income securities, Weitz & Co. considers a number of factors such as the price, coupon and yield-to-maturity, as well as the credit quality of the issuer. In addition, Weitz & Co. reviews the terms of the fixed income security, including subordination, default, sinking fund, and early redemption provisions. The Short-Intermediate Income Fund

may invest up to 15% of its total assets in securities rated below BBB by Standard & Poor’s Corporation or Fitch Ratings or Baa2 by Moody’s Investor’s Service or in unrated securities which Weitz & Co. determines are of comparable quality to the rated securities in which the Short-Intermediate Income Fund may invest. Fixed income securities rated below BBB or Baa2 are generally known as “junk bonds.” The Short-Intermediate Income Fund will normally not invest in fixed income securities which are rated below B by S&P or Fitch or B2 by Moody’s at the time of purchase or which are in default. The Short-Intermediate Income Fund will not be required to dispose of a debt security if it has a rating of B or B2 at the time or purchase, but is downgraded below B or B2 after the time of purchase.

The market values of lower-rated and unrated securities tend to reflect individual corporate developments to a greater extent than do higher-rated securities, which react primarily to fluctuations in the general level of interest rates. Lower-rated and unrated securities also tend to be more sensitive to economic conditions than are higher-rated securities and thus generally involve more credit risk. Changes in economic conditions or other circumstances may cause issuers of lower-rated or unrated securities to have more difficulty making principal and interest payments than issuers of higher-rated securities.

Changes in the value of lower-rated or unrated securities subsequent to their acquisition will not affect cash income, but will be reflected in the net asset value of shares of the Short-Intermediate Income Fund. The market for lower-rated or unrated securities may be less liquid than the market for higher-rated securities. In addition, the liquidity of these lower-rated or unrated securities may be affected by the market’s perception of their credit quality. Therefore, the judgment of Weitz & Co. may at times play a greater role in valuing these securities than is the case with investment grade securities. It also may be more difficult during times of adverse market conditions to sell lower-rated or unrated securities at their fair market value to meet redemption requests or to respond to changes in the market. Although the ratings of established rating agencies may be considered in evaluating a particular security, Weitz & Co. will not rely exclusively on such ratings, but will supplement such ratings with its independent and ongoing review of credit quality.

When Weitz & Co. believes that market or economic conditions warrant a temporary defensive investment position, a greater portion or all the Short-Intermediate Income Fund’s portfolio may be retained in cash or cash equivalents, such as money market shares and repurchase agreements on U.S. Government securities.

This section provides a more detailed description of some of the types of securities and other instruments in which the Short-Intermediate Income Fund may invest. The Short-Intermediate Income Fund may invest in these instruments to the extent permitted by its investment objective and policies and by applicable law. The Short-Intermediate Income Fund is not limited by this discussion and may invest in any other types of instruments not precluded by the policies discussed elsewhere in the Prospectus or Statement of Additional Information.

Common Stock and Securities Convertible into Common Stock The Short-Intermediate Income Fund may invest in preferred stock, common stock and in other securities convertible into common

stock. Convertible bonds and debentures are corporate debt instruments, frequently unsecured and subordinated to senior corporate debt, which may be converted into common stock at a specified price. Such securities may trade at a premium over their face amount when the price of the underlying common stock exceeds the conversion price, but otherwise will normally trade at prices reflecting current interest rate trends.

Covered Call Options The Short-Intermediate Income Fund may write covered call options to generate premium income which Weitz & Co. considers to be an acceptable investment result. Covered call options are contracts sold on a national exchange or in the over-the-counter options market which allow the purchaser to buy the underlying security at a specified price (the "strike price") prior to a certain date. "Covered" options are those in which the option seller (the "writer") owns the underlying securities. Writing covered call options may increase the income of the Short-Intermediate Income Fund since it receives a premium for writing the option. If the Short-Intermediate Income Fund writes covered call options, the underlying securities will be subject to certain deposit procedures and unavailable for sale during the term of the option. As a result, the Short-Intermediate Income Fund will forego any opportunity for appreciation in such securities during the term of the option. The Short-Intermediate Income Fund may attempt to protect itself against a decline in the price of the underlying security or may attempt to benefit from an anticipated increase in such price, by closing the covered call position that is, purchasing an identical call in the open market. There is no assurance, however, that such calls will always be available for purchase in the secondary market at a price which will produce the desired result. The absence of a liquid secondary market in such securities could result from numerous circumstances, such as insufficient trading interest, restrictions imposed by exchanges as to options trading generally or suspensions affecting particular securities, inadequacy of exchange or clearing corporation facilities or decisions by exchanges to discontinue or limit operations trading.

U.S. Government Obligations A portion of the Short-Intermediate Income Fund may be invested in obligations issued or guaranteed by the U.S. Government, its agencies or Government-Sponsored Enterprises (“GSEs”). Some of the obligations purchased by the Short-Intermediate Income Fund are backed by the full faith and credit of the U.S. Government and are guaranteed as to both principal and interest by the U.S. Treasury. Examples of these include direct obligations of the U.S. Treasury, such as U.S. Treasury bills, notes and bonds, and indirect obligations of the U.S. Treasury, such as obligations of the Government National Mortgage Association, Small Business Administration, Maritime Administration, Farmers Home Administration and Department of Veterans Affairs.

Treasury. Fannie Mae and Freddie Mac historically were neither guaranteed nor insured by the U.S. Government. However, on September 7, 2008, the Federal Housing Finance Agency placed Fannie Mae and Freddie Mac into conservatorship, which, in effect, has caused Fannie Mae and Freddie Mac to become guaranteed obligations of the U.S. Government. Although the U.S. Government is providing support to Fannie Mae and Freddie Mac, no assurance can be given that they will continue to do so.

Furthermore, with respect to the U.S. Government securities purchased by the Short-Intermediate Income Fund, guarantees as to the timely payment of principal and interest do not extend to the value or yield of these securities, nor do they extend to the value of the Short-Intermediate Income Fund’s shares.

Most mortgage-related securities are pass-through securities, which means, that they provide investors with payments consisting of both principal and interest as the mortgages in the underlying mortgage pool are paid off. The actual yield of such securities is influenced by the prepayment experience of the mortgage pool underlying the securities. In periods of declining interest rates, prepayment for the underlying mortgages, tend to increase. If the higher-yielding mortgages from the pool are prepaid, the yield on the remaining pool will be reduced and it will be necessary for the Short-Intermediate Income Fund to reinvest such prepayment, presumably at a lower interest rate. Although, depending on the length of the mortgages in the pool, mortgage-related securities may have a stated maturity of up to forty years, prepayments on the underlying mortgages will make the effective maturity of the securities shorter. A security based on a pool of forty-year mortgages may have an average life as short as two years. The maturity of mortgage-related securities will be deemed to be the expected effective maturity of the securities.

Bank Obligations The Short-Intermediate Income Fund may purchase bank obligations, including negotiable certificates of deposit and bankers’ acceptances which evidence the obligation of the banking institution to repay funds deposited with it for a specified period of time at a stated interest rate. The Short-Intermediate Income Fund will normally purchase such obligations from financial institutions which have capital, surplus and undivided profits in excess of $100,000,000 as of the date of the bank’s most recently published financial statements and financial institutions whose obligations are insured by the Federal Deposit Insurance Corporation. Certificates of deposit generally have penalties for early withdrawal, but can be sold to third parties subject to the same risks as other fixed income securities.

Commercial Paper The Short-Intermediate Income Fund may purchase commercial paper which consists of short-term unsecured promissory notes. The Short-Intermediate Income Fund will purchase only commercial paper rated Prime 1 by Moody’s or A-1 by Standard & Poor’s, or if not rated, issued or guaranteed as to payment of principal and interest by companies which at the date of investment have an outstanding debt issue rated AA or better by Standard & Poor’s or Aa or better by Moody’s.

Borrowing The Short-Intermediate Income Fund is authorized to borrow money in order to purchase securities. Borrowing may be considered to be a form of leverage. The Investment Company Act of 1940 requires a Fund to maintain continuous asset coverage of 300% of the amount borrowed. If the 300% asset coverage (that is, total assets including borrowings, less

liabilities exclusive of borrowings) should decline as a result of market fluctuations or for other reasons, The Short-Intermediate Income Fund may be required to sell some of its portfolio holdings within three days in order to reduce the debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to sell securities at that time. Borrowed funds are subject to interest costs that may or may not be offset by amounts earned on the borrowed funds. The Short-Intermediate Income Fund may be required to maintain minimum average balances in connection with its borrowing or pay a commitment or other fee to maintain a line of credit, and either of these requirements would serve to increase the cost of borrowing over the stated interest rate.

Foreign Securities The Short-Intermediate Income Fund may purchase foreign securities that are listed on a principal foreign securities exchange or over-the-counter market, or are represented by American Depository Receipts which are listed on a domestic securities exchange or traded in the United States over-the-counter market. The Short-Intermediate Income Fund may occasionally convert U.S. dollars into foreign currency, but only to effect securities transactions on a foreign securities exchange and not to hold such currency as an investment. The Short-Intermediate Income Fund will not invest in forward foreign currency contracts, except to hedge against the currency risk related to foreign securities held in the portfolio. While the Short-Intermediate Income Fund does not intend to invest any significant portion of its assets in foreign securities, it reserves the right to invest not more than 25% of the value of its total assets in the securities of foreign issuers and obligors.

Investors should recognize that investments in foreign companies involve certain risks that are not typically associated with investing in domestic companies. An investment may be affected by changes in currency rates and in exchange control regulations. Foreign companies are not generally subject to uniform accounting, auditing and financial reporting standards comparable to those applicable to domestic companies, and there may be less publicly available information about a foreign company than about a domestic company. Some foreign stock markets may have substantially less trading activity than the American securities markets, and securities of some foreign companies may be less liquid than securities of comparable domestic companies. Also, commissions on transactions in foreign securities may be higher than similar transactions on domestic stock markets and foreign governments may impose taxes on securities transactions or ownership. There is generally less governmental regulation of stock exchanges, brokers, and listed and unlisted companies in foreign countries than in the United States. In addition, individual foreign economies may differ favorably or unfavorably from the economy of the United States in such respects as growth of gross national product, rate of inflation, capital reinvestment, resource self-sufficiency and balance of payments position.

Restricted/Illiquid Securities The Short-Intermediate Income Fund may invest in securities acquired in a privately negotiated transaction directly from the issuer or a holder of the issuer's securities and which, therefore, could not ordinarily be sold by the Short-Intermediate Income Fund except in another private placement or pursuant to an effective registration statement under the Securities Act of 1933 or an available exemption from such registration requirements. The Short-Intermediate Income Fund may also invest in other illiquid securities, i.e. those that cannot be sold or disposed of in the ordinary course of business at approximately the value at which they are being carried on the Short-Intermediate Income Fund’s books. Illiquid securities may include a wide

variety of investments, including, without limitation (a) repurchase agreements maturing in more than seven days; (b) fixed time deposits that are not subject to prepayment or do not provide for withdrawal penalties upon prepayment (other than overnight deposits); (c) participation in loans; (d) municipal lease obligations; and (e) commercial paper issued pursuant to Section 4(2) of the 1933 Act. If a substantial market develops for a restricted (or other illiquid investment) held by the Short-Intermediate Income Fund, it may be treated as a liquid security, in accordance with procedures and guidelines approved by the Trustees. This generally includes securities that are unregistered, that can be sold to qualified institutional buyers in accordance with Rule 144A under the 1933 Act, or that are exempt from registration under the 1933 Act, such as commercial paper. While Weitz & Co. monitors the liquidity of restricted securities on a daily basis, the Trustees oversee and retain ultimate responsibility for Weitz & Co.’s liquidity determinations. Several factors considered in monitoring decisions about liquidity include the valuation of a security, the availability of qualified institutional buyers, brokers and dealers that trade in the security, and the availability of information about the security’s issuer. The Short-Intermediate Income Fund will not invest in any such restricted or illiquid securities which will cause the then aggregate value of all such securities to exceed 15% of the value of the Short-Intermediate Income Fund's net assets. Restricted and illiquid securities will be valued in such manner as the Trustees in good faith deem appropriate to reflect their fair value. The purchase price, subsequent valuation and resale price of restricted securities normally reflect a discount from the price at which such securities trade when they are not restricted, since the restriction makes them less marketable. The amount of the discount from the prevailing market price will vary depending upon the type of security, the character of the issuer, the party who will bear the expenses of registering the restricted securities, and prevailing supply and demand conditions.

When Issued or Forward Commitment Transactions The Short-Intermediate Income Fund may engage in when issued or forward purchase transactions which involve the purchase or sale of a security by the Short-Intermediate Income Fund with payment and delivery taking place in the future to secure what is considered an advantageous yield and price to the Short-Intermediate Income Fund at the time of entering into the transaction. To the extent the Short-Intermediate Income Fund enters into such forward commitments, it will segregate or “earmark” cash or liquid assets with an aggregate value equal to the amount of its commitment in connection with such purchase transactions.

Investment Company Shares The Short-Intermediate Income Fund may purchase securities of other investment companies, including the Government Money Market Fund, subject to the restrictions of the Investment Company Act of 1940. Investing in the shares of other registered investment companies involves the risk that such other registered investment companies will not achieve their objectives or will achieve a yield or return that is lower than that of the Short-Intermediate Income Fund. To the extent that the Short-Intermediate Income Fund is invested in shares of other investment companies, the Short-Intermediate Income Fund will incur additional expenses as a result of investing in investment company shares.

Investments in Exchange Traded Funds The Short-Intermediate Income Fund may invest in exchange traded funds (“ETFs”). ETFs that are based on a specific index may not be able to replicate and maintain exactly the composition and relative weightings of securities in the applicable index. ETFs also incur certain expenses not incurred by their applicable index.

Additionally, certain securities comprising the index tracked by an ETF may, at times, be temporarily unavailable, which may impede an ETF’s ability to track its index. As a holder of interests in an exchange-traded fund, the Short-Intermediate Income Fund would indirectly bear its ratable share of that fund’s expenses, including applicable management fees. At the same time, the Short-Intermediate Income Fund would continue to pay its own management and advisory fees and other expenses, as a result of which the Short-Intermediate Income Fund and its shareholders in effect may be absorbing multiple levels of certain fees with respect to investments in such exchange-traded funds.

Short Sales The Short-Intermediate Income Fund may engage in short sales “against the box.” A short sale “against the box” is a form of short sale in which the Short-Intermediate Income Fund contemporaneously owns or has the right to obtain at no additional cost securities identical to those sold short. The segregation of cash or other securities is not required for short sales “against the box.” In the event that the Short-Intermediate Income Fund were to sell securities short “against the box” and the price of such securities were to then increase rather than decrease, the Short-Intermediate Income Fund would forego the potential realization of the increased value of the shares held long.

Repurchase Agreements The Short-Intermediate Income Fund may invest in repurchase agreements on U.S. Government securities. Repurchase agreements involve the purchase of U.S. Government securities and a simultaneous agreement with the seller to “repurchase” the securities at a specified price and time, thereby determining the yield during the purchaser’s holding period. This results in a fixed rate of return insulated from market fluctuations during such period. Repurchase agreements usually are for short periods, such as one week. If a repurchase agreement is construed to be a collateralized loan, the underlying securities will not be considered to be owned by the Short-Intermediate Income Fund but only constitute collateral for the seller’s obligation to pay the repurchase price and, in the event of a default by the seller, the Short-Intermediate Income Fund may suffer delays and incur costs or losses in connection with the disposition of the collateral. A repurchase agreement may involve certain risks not associated with a direct purchase of U.S. Government securities. For example, the bank or broker selling the repurchase agreement may default on its obligations to deliver additional securities or to maintain the value of collateral underlying the repurchase agreement or it may fail to repurchase the underlying securities at a time when the value has declined. The Short-Intermediate Income Fund may incur a loss as a result of such default if the liquidation of the collateral results in proceeds less than the repurchase price. In an effort to minimize such risks, the Short-Intermediate Income Fund will only enter into repurchase agreements with member banks of the Federal Reserve with assets, surplus and undivided profits of $100,000,000 or more or recognized regional or national securities dealers.

Loans of Portfolio Securities The Short-Intermediate Income Fund is permitted to engage in securities lending to the extent permitted by SEC policy. Qualified institutions may borrow portfolio securities on a short-term basis. By reinvesting any cash collateral received in these transactions, additional income gains or losses may be realized. The SEC currently permits loans of a mutual fund’s securities up to one-third of its assets, including any collateral received from the loan, provided that the loans are 100% collateralized by cash or cash equivalents on a marked to market basis. Although voting rights of the loaned securities may pass to the borrower, if a material event affecting the investment in the loaned securities is to occur, the Short-Intermediate Income

Fund must terminate the loan and vote the securities. Alternatively, the Short-Intermediate Income Fund may enter into an arrangement that ensures that it can vote the proxy even while the borrower continues to hold the securities. The principal risk in lending securities is the possibility that invested collateral will decline in value, or, as with other extensions of credit, a borrower may fail to honor its obligations, causing a loss for the Short-Intermediate Income Fund.

Interest Rate Futures, Bond Index Futures and Related Options Thereon The Short-Intermediate Income Fund may utilize interest rate futures and bond index futures and related options. The Short-Intermediate Income Fund will not utilize any hedging strategies using interest rate futures and bond index futures or options thereon which will cause the then aggregate value of all such investments to exceed 10% of the value of the Short-Intermediate Income Fund’s total assets at the time of the investment after giving effect thereto. See Appendix A hereto for a general discussion of Interest Rate Futures, Bond Index Futures and Related Options and the risks thereof.

NEBRASKA TAX-FREE INCOME FUND

The following investment restrictions are fundamental restrictions which cannot be changed without the approval of a majority of the Short-Intermediate Income Fund’s outstanding shares. “Majority” means, the lesser of (a) 67% or more of the Short-Intermediate Income Fund’s outstanding shares voting at a special or annual meeting of shareholders at which more than 50% of the outstanding shares are represented in person or by proxy or (b) more than 50% of the Short-Intermediate Income Fund’s outstanding shares.

The Short-Intermediate Income Fund may not:

1.	Underwrite or deal in offerings of securities of other issuers as a sponsor or underwriter in any way.

2.	Purchase or sell real estate except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

3.	Purchase or sell physical commodities or commodity futures contracts, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

4.	Issue any senior security, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

5.	Make loans to others, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

6.	Borrow money, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

7.	Invest more than 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies and instrumentalities and repurchase agreements relating thereto.

As to 75% of its total assets, invest more than 5% of its total assets taken at market value at the time of a particular purchase in the securities of any one issuer other than U.S. Government securities, nor own more than 10% at the time of and giving effect to, a particular purchase of the outstanding voting securities of any one issuer.

INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS-

The Nebraska Tax-Free Income Fund (“Nebraska Fund”) is a non-diversified, open-end investment management company, as defined in the Investment Company Act of 1940. Because the Nebraska Fund is non-diversified, it may have larger positions in fewer companies or industries than a diversified fund. A concentrated portfolio is more likely to experience significant fluctuations in value, exposing the Nebraska Fund to a greater risk of loss in any given period than a diversified fund.

The investment objective of the Nebraska Fund is to provide a high level of current income that is exempt from both federal and Nebraska personal income taxes. A secondary objective is the preservation of capital. The Nebraska Fund seeks to achieve these objectives by investing, under normal circumstances, at least 80% of its net assets plus the amount of any borrowings for investment purposes in municipal securities that generate income exempt from Nebraska state income tax and from federal income tax or in open or closed-end mutual funds which in turn invest in such assets. In addition, the Nebraska Fund will invest no more than 20% of its net assets in municipal securities subject to the federal alternative minimum tax. These policies are fundamental and may not be changed without shareholder approval. Municipal bonds (as defined below) are debt obligations (including, without limitation, bonds, notes, commercial paper and lease obligations) generally issued to obtain funds for various public purposes, including the construction of public facilities, the refinancing of outstanding obligations, and the financing of certain general operating expenses. Municipal bonds may include general obligation bonds, which are backed by the full faith and credit of the issuer and may be repaid from any revenue source and revenue bonds, which may be repaid only from the revenue of a specific facility or project. The Nebraska Fund may also invest up to 20% of its net assets in securities that pay interest that may be subject to the federal alternative minimum tax and, although not anticipated, in securities that pay taxable interest.

The Nebraska Fund will invest primarily in investment-grade securities rated equal to or better than Baa by Moody’s Investors Service or BBB by Fitch Ratings or Standard & Poor’s Corporation (or unrated but determined by Weitz & Co. to be of equivalent quality). The Nebraska Fund may also invest up to 20% of its total assets in lower quality, lower rated debt securities rated Ba by Moody’s or BB by S&P or Fitch or below at the time of purchase (or unrated but determined by Weitz & Co. to be of equivalent quality).

The market values of lower-rated and unrated securities tend to reflect individual issuer-related developments to a greater extent than do higher-rated securities, which react primarily to fluctuations in the general level of interest rates. Lower-rated and unrated securities also tend to be more sensitive to economic conditions than are higher-rated securities and thus generally involve more credit risk. Changes in economic conditions or other circumstances may cause issuers of lower-rated or unrated securities to have more difficulty making principal and interest payments than issuers of higher-rated securities.

Changes in the value of lower-rated or unrated securities subsequent to their acquisition will not affect cash income, but will be reflected in the net asset value of shares of the Nebraska Fund. The market for lower-rated or unrated securities may be less liquid than the market for higher-rated securities. In addition, the liquidity of these lower-rated or unrated securities may be affected by the market’s perception of their credit quality. Therefore, the judgment of Weitz & Co. may at times play a greater role in valuing these securities than is the case with investment grade securities. It also may be more difficult during times of adverse market conditions to sell lower-rated or unrated securities at their fair market value to meet redemption requests or to respond to changes in the market. Although the ratings of established rating agencies may be considered in evaluating a particular security, Weitz & Co. will not rely exclusively on such ratings, but will supplement such ratings with its independent and ongoing review of credit quality.

If Weitz & Co. determines that prevailing abnormal market or economic conditions warrant a temporary defensive position, a greater portion of the Nebraska Fund’s portfolio may be retained in cash or cash equivalents, such as money market fund shares, repurchase agreements on U.S. Government securities or other high quality fixed income securities. In the event the Nebraska Fund takes such a temporary defensive position, it may not achieve its investment objective during this temporary period.

Weitz & Co. selects fixed income securities whose yield is sufficiently attractive in view of the risks of ownership. In deciding whether the Nebraska Fund should invest in particular fixed income securities, Weitz & Co. considers a number of factors such as price, coupon and yield-to-maturity, as well as the credit quality of the issuer. In addition, Weitz & Co. reviews the terms of the fixed income security, including subordination, default, sinking fund, and early redemption provisions. Although the Nebraska Fund has no limitations on the maturities of individual securities, the average dollar-weighted maturity of the Nebraska Fund’s portfolio is generally expected to be less than ten years.

This section provides a more detailed description of some of the types of securities and other instruments in which the Nebraska Fund may invest. The Nebraska Fund may invest in these instruments to the extent permitted by its investment objectives and policies and by applicable law. The Nebraska Fund is not limited by this discussion and may invest in any other types of instruments not precluded by the policies discussed elsewhere in the Prospectus or Statement of Additional Information.

Municipal Bonds Municipal bonds are debt obligations issued by states, municipalities, and other political subdivisions, agencies, authorities, and instrumentalities of states and multi-state agencies or authorities (collectively, “Municipalities”), the interest on which, in the opinion of bond counsel to the issuer at the time of issuance, is exempt from federal income tax. Municipal bonds include securities from a variety of sectors, each of which has unique risks. Municipal bonds include, but are not limited to, general obligation bonds, limited obligation bonds, and revenue bonds, including industrial development bonds issued pursuant to federal tax law. General obligation bonds are obligations involving the credit of an issuer possessing taxing power and are payable from such issuer’s general revenues and not from any particular source. Limited obligation bonds are payable only from the revenues derived from a particular facility or class of facilities or, in some cases, from the proceeds of a special excise or other specific revenue source. Revenue bonds are issued for either project or enterprise financings in which the bond issuer pledges to the bondholders the revenues generated by the operating projects financed from the proceeds of the bond issuance. Revenue bonds involve the credit risk of the underlying project or enterprise (or its corporate user) rather than the credit risk of the issuing municipality. Under the Internal Revenue Code, certain limited obligation bonds are considered “private activity bonds” and interest paid on such bonds is treated as an item of tax preference for purposes of calculating federal alternative minimum tax liability. Tax-exempt private activity bonds and industrial revenue bonds generally are also classified as revenue bonds and thus not payable from the issuer’s general revenues. The credit and quality of private activity bonds and industrial revenue bonds are usually related to the credit of the corporate user of the facilities. Payment of interest on and repayment of principal of such bonds are the responsibility of the corporate user (and/or any guarantor). Some municipal bonds may be issued as variable or floating rate securities and may incorporate market-dependent liquidity features. A tax-exempt fund will invest generally only in securities deemed tax-exempt by bond counsel, but there is no guarantee the interest payments on municipal bonds will continue to be tax-exempt for the life of the bonds.

Some longer-term municipal bonds give the investor the right to “put” or sell the security at par (face value) within a specified number of days following the investor’s request – usually one to seven days. This demand feature enhances a security’s liquidity by shortening its maturity and enables it to trade at a price equal to or very close to par. If a demand feature terminates prior to being exercised, a fund would hold the longer-term security, which could experience substantially more volatility. Municipal bonds that are issued as variable or floating rate securities incorporating market-dependent liquidity features may have greater liquidity risk than other municipal bonds.

Some municipal bonds feature credit enhancements, such as a line of credit, letters of credit, municipal bond insurance, and standby bond purchase agreements (“SBPAs”). SBPAs include lines of credit that are issued by a third party, usually a bank, to enhance liquidity and ensure repayment of principal and any accrued interest if the underlying municipal bond should default. Municipal bond insurance, which is usually purchased by the bond issuer from a private, nongovernmental insurance company, provides an unconditional and irrevocable guarantee that the insured bond’s principal and interest will be paid when due. Insurance does not guarantee the price of the bond or the share price of the Nebraska Fund. The credit rating of an insured bond reflects the credit rating of the insurer, based upon its claims-paying ability. The obligation of a municipal bond insurance company to pay a claim extends over the life of each insured bond. Although defaults on insured municipal bonds have been historically low and municipal bond insurers historically have met their

claims, there is no assurance this will continue. A higher-than-expected default rate could strain the insurer’s loss reserves and adversely affect its ability to pay claims to bondholders. The number of municipal bond insurers is relatively small, and not all of them have the highest credit rating. An SBPA can include a liquidity facility that is provided to pay the purchase price of any bonds that cannot be remarketed. The obligation of the liquidity provider (usually a bank) is only to advance funds to purchase tendered bonds that cannot be remarketed and does not cover principal or interest under any other circumstances. The liquidity provider’s obligations under the SBPA are usually subject to numerous conditions, including the continued creditworthiness of the underlying borrower or bond issuer.

Municipal bonds also include tender option bonds, which are municipal derivatives created by dividing the income stream provided by an underlying municipal bond to create two securities issued by a special-purpose trust, one short term and one long term. The interest rate on the short-term component is periodically reset. The short-term component has negligible interest rate risk, while the long-term component has all of the interest rate risk of the original bond. After income is paid on the short-term securities at current rates, the residual income goes to the long-term securities. Therefore, rising short-term interest rates result in lower income for the longer-term portion, and vice versa. The longer-term components can be very volatile and may be less liquid than other municipal bonds of comparable maturity. These securities have been developed in the secondary market to meet the demand for short-term, tax-exempt securities.

Municipal securities also include a variety of structures geared towards accommodating municipal issuer short-term cash flow requirements. These structures include but are not limited to general market notes, commercial paper, put bonds, and variable rate demand obligations (“VRDOs”). VRDOs comprise a significant percentage of the outstanding debt in the short-term municipal market. VRDOs can be structured to provide a wide range of maturity options (1 day to over 360 days) to the underlying entity and are typically issued at par. The longer the maturity option, the greater the degree of liquidity risk (the risk of not receiving an asking price of par or greater) and reinvestment risk (the risk that the proceeds from maturing bonds must be reinvested at a lower interest rate).

The reorganization under the federal bankruptcy laws of an issuer of, or payment obligor with respect to, municipal bonds may result in the municipal bonds being cancelled without repayment, repaid only in part, or repaid in part or whole through an exchange thereof for any combination of cash, municipal bonds, debt securities, convertible securities, equity securities, or other instruments or rights in respect of the same issuer or payment obligor or a related entity.

Municipal Bonds – Risks Municipal bonds are subject to credit risk. Like other debt securities, municipal bonds include investment-grade, non-investment-grade and unrated securities. Rated municipal bonds that may be held by the Nebraska Fund include those rated investment-grade at the time of investment. The Nebraska Fund may invest up to 20% of its total net assets in securities which are non-investment grade or unrated if Weitz & Co. determines such securities are of comparable quality to the rated securities in which the Nebraska Fund may invest. Information about the financial condition of an issuer of municipal bonds may not be as extensive as that which is made available by corporations whose securities are publicly traded. Obligations of issuers of municipal bonds are subject to the provisions of bankruptcy, insolvency, and other laws affecting

the rights and remedies of creditors. Congress or state legislatures may seek to extend the time for payment of principal or interest, or both, or to impose other constraints upon enforcement of such obligations. There is also the possibility that, as a result of litigation or other conditions, the power or ability of issuers to meet their obligations for the payment of interest and principal on their municipal bonds may be materially affected or their obligations may be found to be invalid or unenforceable. Such litigation or conditions may from time to time have the effect of introducing uncertainties in the market for municipal bonds or certain segments thereof, or of materially affecting the credit risk with respect to particular bonds. Adverse economic, business, legal, or political developments might affect all or a substantial portion of the Nebraska Fund’s municipal bonds in the same manner. In particular, the Nebraska Fund is subject to state-specific risk, which is the chance that the Nebraska Fund, because it invests primarily in securities issued by a particular state and its municipalities, is more vulnerable to unfavorable developments in that state than are funds that invest in municipal securities of many states. Unfavorable developments in any economic sector may have far-reaching ramifications on a state’s overall municipal market. (See the caption Risk Factors Affecting Investments in Nebraska Municipal Securities below).

Municipal bonds are subject to interest rate risk. Interest rate risk is the chance that bond prices overall will decline over short or even long periods because of rising interest rates. Interest rate risk is higher for long-term bonds, whose prices are more sensitive to interest rate changes than are the prices of short-term bonds. Generally, prices of longer maturity issues tend to fluctuate more than prices of shorter maturity issues. Prices and yields on municipal bonds are dependent on a variety of factors, such as the financial condition of the issuer, general conditions of the municipal bond market, the size of a particular offering, the maturity of the obligation and the rating of the issue. A number of those factors, including the ratings of particular issues, are subject to change from time to time.

Municipal bonds are subject to call risk. Call risk is the chance that during periods of falling interest rates issuers of callable bonds may “call”, or redeem, securities with higher interest rates before their maturity dates. Forced to reinvest the unanticipated proceeds at lower interest rates, the Nebraska Fund would experience a decline in income and lose the opportunity for additional price appreciation associated with falling rates. Call risk is generally higher for long-term bonds.

Municipal bonds may be deemed to be illiquid as determined by or in accordance with methods adopted by the Trustees. In determining the liquidity and appropriate valuation of a municipal bond, Weitz & Co. may consider the following factors relating to the security, among others: (a) the frequency of trades and quotes, (b) the number of dealers willing to purchase or sell the security, (c) the willingness of dealers to undertake to make a market, (d) the nature of the marketplace trades, including the time needed to dispose of the security, the method of soliciting offers and the mechanics of transfer, and (e) factors unique to a particular security, including general creditworthiness of the issuer and the likelihood that the marketability of the securities will be maintained throughout the time the security is held by the Nebraska Fund.

Risk Factors Affecting Investments in Nebraska Municipal Securities The Nebraska Fund intends to invest a high proportion of its net assets in Nebraska municipal securities. Because of these investments, the Nebraska Fund is susceptible to political and economic factors affecting the issuers of Nebraska municipal securities. Additionally, the concentration of the Nebraska Fund in

securities issued by governmental units of only one state exposes the Nebraska Fund to risks greater than those of a more diversified portfolio holding securities issued by governmental units of different states in different regions of the country.

Because of limitations contained in the state constitution, the State of Nebraska issues no general obligation bonds secured by the full faith and credit of the state. Several agencies and instrumentalities of state government are authorized to issue bonds secured by revenue from specific projects and activities. Generally, the municipal securities issued by Nebraska’s various governmental units have been highly regarded. However, certain Nebraska municipal securities contain unique risks. Such municipal securities may include, without limitation, health care providers, nuclear power plants, facility offerings and other private activity bonds that lack governmental backing. Furthermore, municipal securities issued by public authorities in Nebraska are not backed by the State’s full faith and credit. The Nebraska Fund’s success may be impacted by its ability to adequately evaluate the unique risks associated with the respective issuers.

The summary below is included for the purpose of providing a general description of Nebraska’s financial condition, and does not purport to be complete. The information is derived from sources that are generally available to investors. Such information has not been independently verified by the Nebraska Fund and the Nebraska Fund assumes no responsibility for the accuracy or completeness of such information. Such information will not be updated during the year.

Nebraska was adversely affected by economic recession in FY 2008-2009, but to a much lesser degree than the overall U.S. The Nebraska Department of Labor reports that the state’s unemployment rate increased from 3.4 percent in June 2008 to 5.1 percent in June 2009. Nationally, the unemployment rate rose from 5.6 percent to 9.5 percent. The number of employed persons in Nebraska decreased 2.9 percent, compared to 3.8 percent in the total U.S.

The total non-farm job count in Nebraska declined 1.7 percent from June 2008 to June 2009. Again, this was much smaller than the loss for the overall U.S., where the fall was 4.1 percent. While employment was lower in the majority of industries in Nebraska, there were a few notable exceptions. Employment in the state rose from June 2008 to June 2009 in educational and health services, leisure and hospitality services, and state and local government.

In agriculture—Nebraska’s largest sector for both self-employment and home-based business—incomes fell with significant declines from June 2008 to June 2009 in the prices of corn, wheat, soybeans, and other crops and in the prices of cattle, hogs, and other livestock. However, the declines followed two years of rapidly rising farm prices, which put aggregate net farm income at historically high levels.

The U.S. Bureau of Economic Analysis reports that Nebraska’s per capita personal income was $37,730 in 2008, or 95 percent of the U.S. average. But Nebraska also had a cost of living below the national average. According to the American Chamber of Commerce Researchers Association Cost of Living Index, the average of general living costs in sample cities of Hastings and metropolitan Omaha was 91 percent of the national average in the first quarter of 2009.

For many years, wages in metropolitan Nebraska have, on average, been higher than in the non-metropolitan parts of the state. Statewide, average hourly earnings increased in manufacturing from $15.23 in June 2008 to $16.27 in June 2009 but they declined in professional and business services from $17.22 to $16.91 an hour.

Housing prices are, on average, lower in Nebraska than in the nation overall, leading to a higher percentage of owner-occupied housing in the state than the U.S. average. But, as in most of the rest of the nation, the number of new housing starts and sales of existing homes in the state have declined significantly during the recession. According to the National Association of Realtors, the number of existing home sales in Nebraska dropped 15.9 percent in the first quarter of 2009 from a year earlier.

For further information concerning Nebraska, see the Fiscal Year Annual Report by the Nebraska Department of Economic Development (“DED”), and any updates thereto. The Report is available on the DED internet website (http://www.neded.org). Monthly employment information is available on the Nebraska Department of Labor web site (http://www.dol.state.ne.us).

Temporary Investments The Nebraska Fund may invest in short-term municipal obligations of up to one year in maturity during periods of using temporary defensive strategies resulting from abnormal market conditions, or when such investments are considered advisable for liquidity. Generally, the income from such short-term municipal obligations is exempt from federal income tax. In addition, a portion of the Nebraska Fund’s assets, which will normally be less than 20%, may be held in cash or invested in high-quality taxable short-term securities of up to one year in maturity. Such investments may include: (a) obligations of the U.S. Treasury; (b) obligations of agencies and instrumentalities of the U.S. Government; (c) money market instruments, such as certificates of deposit issued by domestic banks, corporate commercial paper and bankers’ acceptances and (d) repurchase agreements.

Restricted/Illiquid Securities The Nebraska Fund may invest in securities acquired in a privately negotiated transaction directly from the issuer or a holder of the issuer's securities and which, therefore, could not ordinarily be sold by the Nebraska Fund except in another private placement or pursuant to an effective registration statement under the Securities Act of 1933 (the “1933 Act”) or an available exemption from such registration requirements. The Nebraska Fund may also invest in other illiquid securities, i.e. those that cannot be sold or disposed of in the ordinary course of business at approximately the value at which they are being carried on the Nebraska Fund’s books. Illiquid securities may include a wide variety of investments, including, without limitation (a) repurchase agreements maturing in more than seven days; (b) fixed time deposits that are not subject to prepayment or do not provide for withdrawal penalties upon prepayment (other than overnight deposits); (c) participation in loans; (d) municipal lease obligations; and (e) commercial paper issued pursuant to Section 4(2) of the 1933 Act. If a substantial market develops for a restricted (or other illiquid investment) held by the Nebraska Fund, it may be treated as a liquid security, in accordance with procedures and guidelines approved by the Trustees. This generally includes securities that are unregistered, that can be sold to qualified institutional buyers in accordance with Rule 144A under the 1933 Act, or that are exempt from registration under the 1933 Act, such as commercial paper. While Weitz & Co. monitors the liquidity of restricted securities on a daily basis, the Trustees oversee and retain ultimate responsibility for Weitz & Co.’s liquidity

determinations. Several factors considered in monitoring decisions about liquidity include the valuation of a security, the availability of qualified institutional buyers, brokers and dealers that trade in the security, and the availability of information about the security’s issuer. The Nebraska Fund will not invest in any such restricted or illiquid securities which will cause the then aggregate value of all such securities to exceed 15% of the value of the Nebraska Fund's net assets. Restricted and illiquid securities will be valued in such manner as the Trustees in good faith deem appropriate to reflect their fair value. The purchase price, subsequent valuation and resale price of restricted securities normally reflect a discount from the price at which such securities trade when they are not restricted, since the restriction makes them less marketable. The amount of the discount from the prevailing market price will vary depending upon the type of security, the character of the issuer, the party who will bear the expenses of registering the restricted securities, and prevailing supply and demand conditions.

When Issued or Forward Commitment Transactions The Nebraska Fund may engage in when issued or forward purchase transactions which involve the purchase or sale of a security by the Nebraska Fund with payment and delivery taking place in the future to secure what is considered an advantageous yield and price to the Nebraska Fund at the time of entering into the transaction. To the extent the Nebraska Fund enters into such forward commitments, it will segregate or “earmark” cash or liquid assets with an aggregate value equal to the amount of its commitment in connection with such purchase transactions.

Investment Company Shares The Nebraska Fund may purchase securities of other investment companies subject to the restrictions of the Investment Company Act of 1940. Investing in the shares of other registered investment companies involves the risk that such other registered investment companies will not achieve their objectives or will achieve a yield or return that is lower than that of the Nebraska Fund. To the extent that the Nebraska Fund is invested in shares of other investment companies, the Nebraska Fund will incur additional expenses as a result of investing in investment company shares.

Investments in Exchange Traded Funds The Nebraska Fund may invest in exchange traded funds (“ETFs”). ETFs that are based on a specific index may not be able to replicate and maintain exactly the composition and relative weightings of securities in the applicable index. ETFs also incur certain expenses not incurred by their applicable index. Additionally, certain securities comprising the index tracked by an ETF may, at times, be temporarily unavailable, which may impede an ETF’s ability to track its index. As a holder of interests in an exchange-traded fund, the Nebraska Fund would indirectly bear its ratable share of that fund’s expenses, including applicable management fees. At the same time, the Nebraska Fund would continue to pay its own management and advisory fees and other expenses, as a result of which the Nebraska Fund and its shareholders in effect may be absorbing multiple levels of certain fees with respect to investments in such exchange-traded funds.

Short Sales The Nebraska Fund may engage in short sales “against the box.” A short sale “against the box” is a form of short sale in which the Nebraska Fund contemporaneously owns or has the right to obtain at no additional cost securities identical to those sold short. The segregation of cash or other securities is not required for short sales “against the box.” In the event that the Nebraska Fund were to sell securities short “against the box” and the price of such securities were to then

increase rather than decrease, the Nebraska Fund would forego the potential realization of the increased value of the shares held long.

Borrowing The Nebraska Fund is authorized to borrow money in order to purchase securities. Borrowing may be considered to be a form of leverage. The Investment Company Act of 1940 requires a Fund to maintain continuous asset coverage of 300% of the amount borrowed. If the 300% asset coverage (that is, total assets including borrowings, less liabilities exclusive of borrowings) should decline as a result of market fluctuations or for other reasons, the Nebraska Fund may be required to sell some of its portfolio holdings within three days in order to reduce the debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to sell securities at that time. Borrowed funds are subject to interest costs that may or may not be offset by amounts earned on the borrowed funds. The Nebraska Fund may be required to maintain minimum average balances in connection with its borrowing or pay a commitment or other fee to maintain a line of credit, and either of these requirements would serve to increase the cost of borrowing over the stated interest rate.

Loans of Portfolio Securities The Nebraska Fund is permitted to engage in securities lending to the extent permitted by SEC policy. Qualified institutions may borrow portfolio securities on a short-term basis. By reinvesting any cash collateral received in these transactions, additional income gains or losses may be realized. The SEC currently permits loans of a mutual fund’s securities up to one-third of its assets, including any collateral received from the loan, provided that the loans are 100% collateralized by cash or cash equivalents on a marked to market basis. Although voting rights of the loaned securities may pass to the borrower, if a material event affecting the investment in the loaned securities is to occur, the Nebraska Fund must terminate the loan and vote the securities. Alternatively, the Nebraska Fund may enter into an arrangement that ensures that it can vote the proxy even while the borrower continues to hold the securities. The principal risk in lending securities is the possibility that invested collateral will decline in value, or, as with other extensions of credit, a borrower may fail to honor its obligations, causing a loss for the Nebraska Fund.

Interest Rate Futures, Bond Index Futures and Related Options Thereon The Nebraska Fund may utilize interest rate futures and bond index futures and related options. The Nebraska Fund will not utilize any hedging strategies using interest rate futures and bond index futures or options thereon which will cause the then aggregate value of all such investments to exceed 10% of the value of the Nebraska Fund’s total assets at the time of the investment after giving effect thereto. See Appendix A hereto for a general discussion of Interest Rate Futures, Bond Index Futures and Related Options and the risks thereof.

GOVERNMENT MONEY MARKET FUND

The following investment restrictions are fundamental restrictions which cannot be changed without the approval of a majority of the Nebraska Fund’s outstanding shares. “Majority” means, the lesser of (a) 67% or more of the Nebraska Fund’s outstanding shares voting at a special or annual meeting of shareholders at which more than 50% of the outstanding shares are represented in person or by

Proxy or (b) more than 50% of the Nebraska Fund’s outstanding shares. The Nebraska Fund may not:

1.	Underwrite or deal in offerings of securities of other issuers as a sponsor or underwriter in any way.

2.	Purchase or sell real estate except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

3.	Purchase or sell physical commodities or commodity futures contracts, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

4.	Issue any senior security, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

5.	Make loans to others, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

6.	Borrow money, except as permitted under the 1940 Act, and as interpreted or modified by regulatory authority having jurisdiction, from time to time.

7.	Invest more than 25% of the value of its total assets in the securities of any one industry. This restriction does not apply to securities of the U.S. Government or its agencies and instrumentalities and repurchase agreements relating thereto.

As to 50% of its total assets, (a) invest more than 5% of its total assets (taken at market value at the time of each investment) in the securities of any one issuer, nor (b) purchase more than 10% of the outstanding voting securities of an issuer, except that such restrictions shall not apply to securities issued by or guaranteed by the U.S. Government or its agencies, bank money instrument or bank repurchase agreements.

INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS-

The Government Money Market Fund is a diversified, open-end investment management company as defined in the Investment Company Act of 1940.

The investment objective of the Government Money Market Fund is current income consistent with the preservation of capital and maintenance of liquidity. The Government Money Market Fund invests substantially all of its assets (not less than 90%) in debt obligations with maturities not exceeding 13 months issued or guaranteed by the U.S. Government and its agencies and

instrumentalities and repurchase agreements thereon. The Government Money Market Fund may invest in obligations which are subject to repurchase agreements with any member bank of the Federal Reserve System with assets, surplus and undivided profits of $100,000,000 or more or a primary dealer in U.S. Government securities. As a matter of operating policy, the Government Money Market Fund will not enter into repurchase agreements with more than seven days to maturity if it would result in the investment of more than 10% of the value of the Government Money Market Fund’s assets in such repurchase agreements. The Government Money Market Fund may purchase such securities on a when issued or forward commitment basis and will maintain a segregated account with the custodian of cash or liquid U.S. Government obligations in an aggregate amount equal to the amount of its commitment in connection with such purchases.

The Government Money Market Fund may invest in reverse repurchase agreements which involve the temporary transfer of a security in the portfolio of the Government Money Market Fund to another party, such as a bank or broker dealer, in return for cash, and an agreement to buy the security back at a future date and price. The Government Money Market Fund can invest the cash it receives or use it to meet redemption requests. If the Government Money Market Fund reinvests the cash at a rate higher than the cost of the agreement, it may earn additional income. At the same time, the Government Money Market Fund is exposed to greater potential fluctuations in the value of its assets when engaging in reverse repurchase agreements. During the time a reverse repurchase agreement is outstanding, the Government Money Market Fund will maintain cash and liquid securities in a segregated account with a value at least equal to its obligations under the agreement.

Investment Company Shares The Government Money Market Fund may purchase securities of other investment companies subject to the restrictions of the Investment Company Act of 1940. Investing in the shares of other registered investment companies involves the risk that such other registered investment companies will not achieve their objectives or will achieve a yield or return that is lower than that of the Government Money Market Fund. To the extent the Government Money Market Fund is invested in shares of other investment companies, the Government Money Market Fund will incur additional expenses as a result of investing in investment company shares.