-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OHlO/ul7iHfUwE2r/eE6icLTEZOyoSIFlAXCeiSONkU4aUTQqvs0WYOu2/VNWMPO nQXKNlpFKDYnAVuXsP1h9g== 0000898733-99-000950.txt : 19991109 0000898733-99-000950.hdr.sgml : 19991109 ACCESSION NUMBER: 0000898733-99-000950 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990924 FILED AS OF DATE: 19991108 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WORLD MONITOR TRUST SERIES A CENTRAL INDEX KEY: 0001051822 STANDARD INDUSTRIAL CLASSIFICATION: INVESTORS, NEC [6799] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-43033 FILM NUMBER: 99743519 BUSINESS ADDRESS: STREET 1: ONE NEW YORK PLAZA 13TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10292-2013 BUSINESS PHONE: 2127787866 MAIL ADDRESS: STREET 1: ONE NEW YORK PLAZA 13TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10292-2013 10-Q 1 WORLD MONITOR TRUST-SERIES A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 24, 1999 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________________ to ______________________ Commission file number: 0-25785 WORLD MONITOR TRUST--SERIES A - -------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) Delaware 13-3985040 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) One New York Plaza, 13th Floor, New York, New York 10292 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 778-7866 N/A - -------------------------------------------------------------------------------- Former name, former address and former fiscal year, if changed since last report Indicate by check CK whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes _CK_ No __ PART I. FINANCIAL INFORMATION ITEM I. FINANCIAL STATEMENTS WORLD MONITOR TRUST--SERIES A (a Delaware Business Trust) STATEMENTS OF FINANCIAL CONDITION (Unaudited)
September 24, December 31, 1999 1998 - ---------------------------------------------------------------------------------------------------- ASSETS Equity in commodity trading accounts: Cash $16,276,904 $11,008,050 Net unrealized loss on open commodity positions (424,637) (103,243 ) ------------- ------------ Net equity 15,852,267 10,904,807 Accrued interest receivable 49,461 -- ------------- ------------ Total assets $15,901,728 $10,904,807 ------------- ------------ ------------- ------------ LIABILITIES AND TRUST CAPITAL Liabilities Commissions payable $ 92,182 $ 74,604 Management fee payable 24,050 19,457 Redemptions payable 16,903 -- ------------- ------------ Total liabilities 133,135 94,061 ------------- ------------ Commitments Trust capital Limited interests (171,428.284 and 108,568.155 interests outstanding) 15,568,788 10,673,116 General interests (2,200 and 1,400 interests outstanding) 199,805 137,630 ------------- ------------ Total trust capital 15,768,593 10,810,746 ------------- ------------ Total liabilities and trust capital $15,901,728 $10,904,807 ------------- ------------ ------------- ------------ Net asset value per limited and general interests ('Interests') $ 90.82 $ 98.31 ------------- ------------ ------------- ------------ - ---------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of these statements.
2 WORLD MONITOR TRUST--SERIES A (a Delaware Business Trust) STATEMENTS OF OPERATIONS (Unaudited)
For the period from June 10, 1998 For the period from For the period from (commencement of For the period from June 27, 1998 January 1, 1999 to operations) to June 26, 1999 to to September 24, 1999 September 25, 1998 September 24, 1999 September 25, 1998 - ------------------------------------------------------------------------------------------------------------------------ REVENUES Net realized gain (loss) on commodity transactions $ (491,737) $ 334,066 $(463,249) $ 374,470 Change in net unrealized gain/loss on open commodity positions (321,394) 45,224 (337,139) 69,120 Interest income 530,649 133,111 203,736 116,596 --------------------- ----------- ----------- ----------- (282,482) 512,401 (596,652) 560,186 --------------------- ----------- ----------- ----------- EXPENSES Commissions 832,632 178,944 304,806 155,665 Management fees 214,558 46,131 78,544 40,129 Incentive fees 385 36,064 50 36,064 --------------------- ----------- ----------- ----------- 1,047,575 261,139 383,400 231,858 --------------------- ----------- ----------- ----------- Net income (loss) $(1,330,057) $ 251,262 $(980,052) $ 328,328 --------------------- ----------- ----------- ----------- --------------------- ----------- ----------- ----------- ALLOCATION OF NET INCOME (LOSS) Limited interests $(1,314,916) $ 248,210 $(969,178) $ 324,441 --------------------- ----------- ----------- ----------- --------------------- ----------- ----------- ----------- General interests $ (15,141) $ 3,052 $ (10,874) $ 3,887 --------------------- ----------- ----------- ----------- --------------------- ----------- ----------- ----------- NET INCOME (LOSS) PER WEIGHTED AVERAGE LIMITED AND GENERAL INTEREST Net income (loss) per weighted average limited and general interest $ (8.88) $ 3.21 $ (5.80) $ 4.07 --------------------- ----------- ----------- ----------- --------------------- ----------- ----------- ----------- Weighted average number of limited and general interests outstanding 149,811 78,193 169,117 80,736 --------------------- ----------- ----------- ----------- --------------------- ----------- ----------- ----------- - ------------------------------------------------------------------------------------------------------------------------
STATEMENT OF CHANGES IN TRUST CAPITAL (Unaudited)
LIMITED GENERAL INTERESTS INTERESTS INTERESTS TOTAL - ----------------------------------------------------------------------------------------------------- Trust capital--December 31, 1998 109,968.155 $10,673,116 $137,630 $10,810,746 Contributions 91,717.495 8,858,374 77,316 8,935,690 Net loss -- (1,314,916) (15,141 ) (1,330,057) Redemptions (28,057.366) (2,647,786) -- (2,647,786) ------------ ----------- --------- ----------- Trust capital--September 24, 1999 173,628.284 $15,568,788 $199,805 $15,768,593 ------------ ----------- --------- ----------- ------------ ----------- --------- ----------- - ----------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of these statements.
3 WORLD MONITOR TRUST--SERIES A (a Delaware Business Trust) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 24, 1999 (Unaudited) A. General These financial statements have been prepared without audit. In the opinion of management, the financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position of World Monitor Trust--Series A ('Series A') as of September 24, 1999 and the results of its operations for the periods from January 1, 1999 to September 24, 1999 ('Year-To-Date 1999'), June 10, 1998 (commencement of operations) to September 25, 1998 ('Year-To-Date 1998'), June 26, 1999 to September 24, 1999 ('Third Quarter 1999') and June 27, 1998 to September 25, 1998 ('Third Quarter 1998'). However, the operating results for the interim periods may not be indicative of the results expected for a full year. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been omitted. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in Series A's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 1998 (the 'Annual Report'). B. Related Parties The managing owner of Series A is Prudential Securities Futures Management Inc. (the 'Managing Owner'), a wholly owned subsidiary of Prudential Securities Incorporated ('PSI') which, in turn, is a wholly owned subsidiary of Prudential Securities Group Inc. The Managing Owner or its affiliates perform services for Series A which include but are not limited to: brokerage services, accounting and financial management, registrar, transfer and assignment functions, investor communications, printing and other administrative services. Except for costs related to brokerage services, PSI or its affiliates pay the costs of these services in addition to costs of organizing Series A and offering its Interests as well as the routine operational, administrative, legal and auditing fees. As described in the Annual Report, all commissions for brokerage services are paid to PSI. All of the proceeds of the offering of Series A are received in the name of Series A and deposited in trading or cash accounts at PSI, Series A's commodity broker. Series A's assets are maintained either with PSI or, for margin purposes, with the various exchanges on which Series A is permitted to trade. PSI credits Series A monthly with 100% of the interest it earns on the average net assets in Series A's accounts. Series A, acting through its trading advisor, may execute over-the-counter, spot, forward and/or option foreign exchange transactions with PSI. PSI then engages in back-to-back trading with an affiliate, Prudential-Bache Global Markets Inc. ('PBGM'). PBGM attempts to earn a profit on such transactions. PBGM keeps its prices on foreign currency competitive with other interbank currency trading desks. All over-the-counter currency transactions are conducted between PSI and Series A pursuant to a line of credit. PSI may require that collateral be posted against the marked-to-market positions of Series A. As of September 24, 1999, a non-U.S. affiliate of the Managing Owner owns 101.112 limited interests of Series A. C. Credit and Market Risk Since Series A's business is to trade futures, forward (including foreign exchange transactions) and options contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk). Futures, forward and options contracts involve varying degrees of off-balance sheet risk; and changes in the level or volatility of interest rates, foreign currency exchange rates or the market values of the contracts (or commodities underlying the contracts) frequently result in changes in unrealized gain (loss) on open commodity positions reflected in the statements of financial condition. Series A's exposure to market risk is influenced by a number of factors including the relationships among the contracts held by Series A as well as the liquidity of the markets in which the contracts are traded. 4 Futures and options contracts are traded on organized exchanges and are thus distinguished from forward contracts which are entered into privately by the parties. The credit risks associated with futures and options contracts are typically perceived to be less than those associated with forward contracts because exchanges typically provide clearinghouse arrangements in which the collective credit (subject to certain limitations) of the members of the exchanges is pledged to support the financial integrity of the exchange. On the other hand, Series A must rely solely on the credit of its broker (PSI) with respect to forward transactions. Series A presents unrealized gains and losses on open forward positions, if any, as a net amount in the statements of financial condition because it has a master netting agreement with PSI. The Managing Owner attempts to minimize both credit and market risks by requiring Series A and its trading advisor to abide by various trading limitations and policies. The Managing Owner monitors compliance with these trading limitations and policies which include, but are not limited to, executing and clearing all trades with creditworthy counterparties (currently, PSI is the sole counterparty or broker); limiting the amount of margin or premium required for any one commodity or all commodities combined; and generally limiting transactions to contracts which are traded in sufficient volume to permit the taking and liquidating of positions. Additionally, pursuant to the Advisory Agreement among Series A, the Managing Owner and the trading advisor, Series A shall automatically terminate the trading advisor if the net asset value allocated to the trading advisor declines by 33 1/3% from the value at the beginning of any year or since the commencement of trading activities. Furthermore, the Second Amended and Restated Declaration of Trust and Trust Agreement provides that Series A will liquidate its positions, and eventually dissolve, if Series A experiences a decline in the net asset value of 50% from the value at the beginning of any year or since the commencement of trading activities. In each case, the decline in net asset value is after giving effect for distributions, contributions and redemptions. The Managing Owner may impose additional restrictions (through modifications of such trading limitations and policies) upon the trading activities of the trading advisor as it, in good faith, deems to be in the best interests of Series A. PSI, when acting as the futures commission merchant in accepting orders for the purchase or sale of domestic futures and options contracts, is required by Commodity Futures Trading Commission ('CFTC') regulations to separately account for and segregate as belonging to Series A all assets of Series A relating to domestic futures and options trading and is not to commingle such assets with other assets of PSI. At September 24, 1999, such segregated assets totalled $14,740,754. Part 30.7 of the CFTC regulations also requires PSI to secure assets of Series A related to foreign futures and options trading which totalled $2,098,324 at September 24, 1999. There are no segregation requirements for assets related to forward trading. As of September 24, 1999, all open futures and forward contracts mature within three months. As of September 24, 1999 and December 31, 1998, gross contract amounts of open futures and forward contracts for Series A were:
1999 1998 ----------- ----------- Financial Futures Contracts: Commitments to purchase $85,939,540 $18,683,310 Commitments to sell 3,529,157 16,579,358 Currency Futures Contracts: Commitments to purchase 12,742,417 -- Currency Forward Contracts: Commitments to purchase 24,359,015 362,056 Commitments to sell 17,298,175 -- Other Futures Contracts: Commitments to purchase 5,483,077 -- Commitments to sell 1,549,800 3,076,903
The gross contract amounts represent Series A's potential involvement in a particular class of financial instrument (if it were to take or make delivery on an underlying futures or forward contract). The gross contract amounts significantly exceed the future cash requirements as Series A intends to close out open positions prior to settlement and thus is generally subject only to the risk of loss arising from the change in the value of the contracts. As such, Series A considers the 'fair value' of its futures and forward contracts to be the net unrealized gain or loss on the contracts. Thus, the amount at risk associated with counterparty 5 nonperformance of all contracts is the net unrealized gain included in the statements of financial condition. The market risk associated with Series A's commitments to purchase commodities is limited to the gross contract amounts involved, while the market risk associated with its commitments to sell is unlimited since its potential involvement is to make delivery of an underlying commodity at the contract price; therefore, it must repurchase the contract at prevailing market prices. At September 24, 1999 and December 31, 1998, the fair value of open futures and forward contracts was:
1999 1998 ---------------------------- -------------------------- Assets Liabilities Assets Liabilities ---------- ----------- -------- ----------- Futures Contracts: Domestic exchanges Financial $ 14,734 $ 79,490 $ -- $ -- Currencies 339,626 12,930 -- -- Other 439,298 69,000 31,724 11,760 Foreign exchanges Financial 106,910 151,628 204,523 -- Other -- 25,346 34,326 -- Forward Contracts: Currencies 274,883 1,261,694 -- 362,056 ---------- ----------- -------- ----------- $1,175,451 $ 1,600,088 $270,573 $ 373,816 ---------- ----------- -------- ----------- ---------- ----------- -------- -----------
The following table presents the average fair value of futures and forward contracts for the periods detailed below:
Third Quarter Year-To-Date 1999 Year-To-Date 1998 Third Quarter 1999 1998 -------------------------- ------------------------ -------------------------- -------- Assets Liabilities Assets Liabilities Assets Liabilities Assets ---------- ----------- -------- ----------- ---------- ----------- -------- Futures Contracts: Domestic exchanges Financial $ 59,430 $ 19,865 $ -- $ -- $ 131,369 $ 33,141 $ -- Currencies 229,498 14,743 16,425 3,953 219,386 32,208 15,269 Other 115,339 15,604 58,832 5,978 212,878 29,127 55,155 Foreign exchanges Financial 184,792 41,297 198,631 5,076 239,081 64,939 186,217 Other 31,927 62,383 -- 112,796 24,874 76,935 -- Forward Contracts: Currencies 520,377 781,512 332,216 377,625 384,395 1,504,281 309,435 ---------- ----------- -------- ----------- ---------- ----------- -------- $1,141,363 $ 935,404 $606,104 $ 505,428 $1,211,983 $ 1,740,631 $566,076 ---------- ----------- -------- ----------- ---------- ----------- -------- ---------- ----------- -------- ----------- ---------- ----------- -------- Liabilities ----------- Futures Contracts: Domestic exchanges Financial $ -- Currencies 7,008 Other 5,189 Foreign exchanges Financial 4,759 Other 105,746 Forward Contracts: Currencies 355,202 ----------- $ 477,904 ----------- -----------
The following table presents the trading revenues of futures and forward contracts for the periods detailed below:
Year-To-Date Year-To-Date Third Quarter Third Quarter 1999 1998 1999 1998 ------------ -------------- -------------- -------------- Futures Contracts: Domestic exchanges Financial $ (427,638) $ (44,325) $ (439,770) $ (44,325) Currencies 802,053 (74,411) 363,005 (56,799) Other 584,536 9,961 674,408 50,365 Foreign exchanges Financial (276,297) 614,902 (94,192) 614,902 Other (94,723) (195,928) 122,066 (195,928) Forward Contracts: Currencies (1,401,062) 69,091 (1,425,905) 75,375 ------------ -------------- -------------- -------------- $ (813,131) $ 379,290 $ (800,388) $ 443,590 ------------ -------------- -------------- -------------- ------------ -------------- -------------- --------------
D. Subsequent Event As of November 8, 1999, $33,829,000 of Series A Interests were sold. Therefore, only $171,000 of additional Interests will be offered before the subscription maximum of $34,000,000 are sold. 6 WORLD MONITOR TRUST--SERIES A (a Delaware Business Trust) ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Liquidity and Capital Resources Series A commenced operations on June 10, 1998 with gross proceeds of $6,039,177 allocated to commodities trading. Additional contributions raised through the continuous offering for the period from June 10, 1998 (commencement of operations) through September 24, 1999 resulted in additional gross proceeds to Series A of $14,007,269. As of November 8, 1999, $33,829,000 of Series A Interests were sold. Therefore, only $171,000 of additional Interests will be offered before the subscription maximum of $34,000,000 are sold. At September 24, 1999, 100% of Series A's net assets were allocated to commodities trading. A significant portion of the net assets was held in cash which is used as margin for Series A's trading in commodities. Inasmuch as the sole business of Series A is to trade in commodities, Series A continues to own such liquid assets to be used as margin. PSI credits Series A monthly with 100% of the interest it earns on the average net assets in Series A's accounts. The commodities contracts are subject to periods of illiquidity because of market conditions, regulatory considerations and other reasons. For example, commodity exchanges limit fluctuations in certain commodity futures contract prices during a single day by regulations referred to as 'daily limits.' During a single day, no trades may be executed at prices beyond the daily limit. Once the price of a futures contract for a particular commodity has increased or decreased by an amount equal to the daily limit, positions in the commodity can neither be taken nor liquidated unless traders are willing to effect trades at or within the limit. Commodity futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. Such market conditions could prevent Series A from promptly liquidating its commodity futures positions. Since Series A's business is to trade futures, forward and options contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk). Series A's exposure to market risk is influenced by a number of factors including the volatility of interest rates and foreign currency exchange rates, the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of Series A's speculative trading as well as the development of drastic market occurrences could result in monthly losses considerably beyond Series A's experience to date and could ultimately lead to a loss of all or substantially all of investors' capital. The Managing Owner attempts to minimize these risks by requiring Series A and its trading advisor to abide by various trading limitations and policies, which include limiting margin amounts, trading only in liquid markets and utilizing stop loss provisions. See Note C to the financial statements for a further discussion on the credit and market risks associated with Series A's futures, forward and options contracts. Series A does not have, nor does it expect to have, any capital assets. Redemptions of limited interests for the Third Quarter 1999 were $1,335,349. Redemptions of limited interests for the period from June 10, 1998 (commencement of operations) through September 24, 1999 were $2,775,938. Future redemptions and contributions will impact the amount of funds available for investment in commodity contracts in subsequent periods. Results of Operations The net asset value per Interest as of September 24, 1999 was $90.82, a decrease of 7.62% from the December 31, 1998 net asset value per Interest of $98.31, and a decrease of 5.93% from the June 25, 1999 net asset value per Interest of $96.55. Quarterly Market Overview During the quarter, global financial markets experienced heavy volatility. In July, U.S. Federal Reserve policy gave markets a boost. However, record trade deficits, higher employment costs, fears of inflation and higher interest rates in the U.S. quickly caused a reversal in U.S. stock and bond markets. Global stock and bond markets followed U.S. markets demonstrating increased volatility. The U.S. dollar also experienced 7 fluctuations throughout the quarter as signs of a stronger U.S. economy versus the European community supported the dollar's rise to new highs against most major currencies. However, later in the quarter as a record trade gap and stronger than expected European economic data were reported, the U.S. dollar came under pressure and continued to fall against most major currencies and to record lows against the Japanese yen. In the commodities markets, energy prices rose as OPEC members agreed to maintain cuts in oil output. The metal sector experienced extreme movement as gold prices rose to a two-year high following reports that 15 European Central banks would limit sales and retain higher gold reserves. Quarterly Performance of Series A Currency sector trading incurred losses from British pound, Swiss franc, Australian dollar, and Canadian dollar positions. In Europe, despite sluggish German exports and a rapidly expanding money supply, a strong economy made possible a rate hike by the European Central Bank. Additionally, the Bank of England shocked markets with a 25 basis point rate hike. The Swiss franc bottomed out early in the quarter after trading passed an eight-year low against the U.S. dollar. Commodity based currencies such as the Australian and Canadian dollars, experienced losses against the U.S. dollar as the price of gold and other precious metals surged during September. Trading in the index sector resulted in losses due to long positions in the S&P 500 and Nikkei Dow (Japan). The U.S. stock market fell in anticipation of an August interest rate hike. Global stock markets followed the U.S. market's lead. Pressure to raise rates throughout the world repressed global stock and bond prices throughout the remainder of the quarter. In Japan, the Nikkei Dow moved sideways and a bit downward though not demonstrating a bear trend, closing lower by the end of the quarter. Series A experienced losses from trading in the financial sector due to weakness in the global bond markets. Pressure throughout Europe and the U.S. to raise rates continued to repress bond prices. Global interest rate markets followed the U.S. lead as rates moved higher. On August 24th, the Federal Open Market Committee decided to increase the U.S. federal funds rate by 25 basis points. Positions in the U.S. Treasury bond and British 3-month bond incurred losses. Losses were incurred in the metal sector due to gold and silver positions. The European Central bank's decision to limit both gold sales and lending triggered strong movement in the gold market. Gold prices rose to two-year highs over a 10-day period, causing short positions to incur losses for the Trust. Silver prices moved in conjunction with gold as prices rallied towards quarter end. The Trust captured gains in the energy sector from long positions in light crude and heating oil. OPEC's production cuts continued to prove effective for oil markets. Expectations that current output levels could be maintained for the foreseeable future also contributed to the bullish sentiment. Profits in the grain sector were derived from short soybean positions. Soybean oil prices fell as drought-related supply concerns were alleviated and the market began to focus on weak domestic demand towards quarter end. Series A commenced trading operations on June 10, 1998, and as such, full year-to-date comparative information is not meaningful for 1998. Increases in interest income, commissions and management fees during Third Quarter 1999 as compared to Third Quarter 1998 are primarily due to the effect of contributions received during 1998 and 1999 on Series A's net asset values. These increases were partially offset by the effect of the poor trading performance during 1999. Interest income is earned on the average net assets held at PSI and, therefore, varies monthly according to interest rates, trading performance, contributions and redemptions. Interest income was $531,000 and $133,000 for Year-To-Date 1999 and Year-To-Date 1998, respectively. Interest income increased $87,000 during Third Quarter 1999 as compared to Third Quarter 1998 due to the reasons discussed above, partially offset by lower interest rates in 1999. Commissions are calculated on Series A's net asset value at the end of each week and, therefore, vary according to weekly trading performance, contributions and redemptions. Commissions were $833,000 and $179,000 for Year-To-Date 1999 and Year-To-Date 1998, respectively. Commissions increased $149,000 during Third Quarter 1999 as compared to Third Quarter 1998 due to the reasons discussed above. All trading decisions for Series A are made by Eagle Trading Systems, Inc. (the 'Trading Advisor'). Management fees are calculated on Series A's net asset value at the end of each week and, therefore, are 8 affected by weekly trading performance, contributions and redemptions. Management fees were $215,000 and $46,000 for Year-To-Date 1999 and Year-To-Date 1998, respectively. Management fees increased $38,000 during Third Quarter 1999 as compared to Third Quarter 1998 due to the reasons discussed above. Incentive fees are based on the New High Net Trading Profits generated by the Trading Advisor, as defined in the Advisory Agreement among Series A, the Managing Owner and the Trading Advisor. Incentive fees were negligble in Year-To-Date 1999. Incentive fees of $37,000 were earned in the Third Quarter 1998. Year 2000 Risk A discussion of Year 2000 risk and its effect on the operations of Series A is included in Series A's Annual Report. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Information regarding quantitative and qualitative disclosures about market risk is not required pursuant to Item 305(e) of Regulation S-K. 9 PART II. OTHER INFORMATION Item 1. Legal Proceedings--There are no material legal proceedings pending by or against the Registrant or the Managing Owner. Item 2. Changes in Securities--None Item 3. Defaults Upon Senior Securities--None Item 4. Submission of Matters to a Vote of Security Holders--None Item 5. Other Information--None Item 6. (a) Exhibits-- 3.1 and 4.1-- Second Amended and Restated Declaration of Trust and Trust Agreements of World Monitor Trust dated as of March 17, 1998 (incorporated by reference to Exhibits 3.1 and 4.1 to Series A's Registration Statement on Form S-1, File No. 333-43033) 4.2-- Form of Request for Redemption (incorporated by reference to Exhibit 4.2 to Series A's Registration Statement on Form S-1, File No. 333-43033) 4.3-- Form of Exchange Request (incorporated by reference to Exhibit 4.3 to Series A's Registration Statement on Form S-1, File No. 333-43033) 4.4-- Form of Subscription Agreement (incorporated by reference to Exhibit 4.4 to Series A's Registration Statement on Form S-1, File No. 333-43033) 27.1--Financial Data Schedule (filed herewith) (b) Reports on Form 8-K--None 10 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. WORLD MONITOR TRUST--SERIES A By: Prudential Securities Futures Management Inc. A Delaware corporation, Managing Owner By: /s/ Steven Carlino Date: November 8, 1999 ---------------------------------------- Steven Carlino Vice President and Treasurer 11 EX-27 2 ART. 5 FDS FOR 3RD QUARTER 10-Q
5 The Schedule contains summary financial information extracted from the financial statements for World Monitor Trust-Series A and is qualified in its entirety by reference to such financial statements 1051822 World Monitor Trust-Series A 1 Dec-31-1999 Jan-1-1999 Sep-24-1999 9-Mos 16,276,904 (424,637) 49,461 0 0 15,901,728 0 0 15,901,728 133,135 0 0 0 0 15,768,593 15,901,728 0 (282,482) 0 1,047,575 0 0 0 0 0 0 0 0 0 (1,330,057) (8.88) 0
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